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Luck does play a part in underwriting

Dear Friend,

I had a great time at the World Insurance Forum over in Bermuda last week —the weather wasn’t up to much, but the list of attendees at this biennial event was a veritable who’s who of the industry.

In fact the line-up was so illustrious that it is perhaps best described by listing those who didn’t attend. Well, Warren Buffet couldn’t make it and neither could Jacques Aigrain of Swiss Re (and I guess Eliot Spitzer probably wasn’t invited!) but that is just about it — everyone else was either on a discussion panel or in the crowd watching and avidly taking notes.

The format was very relaxed and the fact that we were in a hotel well outside Hamilton meant that many attendees didn’t immediately rush off to client meetings. This meant that you could find yourself making small talk with some very senior people during coffee breaks.

The conference took the form of open discussions with the speakers sitting on comfy chairs — yet despite this cosy atmosphere, some pretty hard-hitting discussions were had on the future of the industry.

But what you want to know is in such a glittering firmament, who shined the brightest?

For me the hands-down winner was Nikolaus von Bomhard. I was surprised at how well Munich Re’s CEO comes across — whereas in other more set-piece press conferences he has seemed a little stiff, in the relaxed atmosphere he seemed to blossom — he even cracked a few good jokes.

And one of the most surprising things he said to our privileged gathering was that despite the benefit of over a hundred and twenty five years of corporate experience behind him he still admits that luck actually does still play an important role in the business of underwriting.

This is pretty amazing stuff when it comes from the CEO of a company that has more benefit from the law of large numbers than any other player (with the possible exception of Swiss Re, depending on whether or not you count the GE acquisition).

It got me thinking — if the CEO of Munich Re sometimes feels like he could do with a bit of good luck, I wonder what the CEOs of the class of 2005 feel, as we all march boldly towards the next hurricane season?

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