Brokers positive as QBE appoints Andrew Horton as new leader

Andrew Horton’s background at the well-regarded UK insurer Beazley has resulted in positive reviews of his appointment as the new QBE boss.

Incoming QBE chief executive Andrew Horton.

The market has welcomed the appointment of Andrew Horton as head of global insurer QBE, citing his current position as chief executive at well-regarded specialist insurer Beazley.

Mr Horton will replace interim chief executive Richard Pryce, who has previously indicated his intention to retire.

“This will not cause undue concern to the equity markets given the history of the candidate chosen and the fact that management change was already anticipated,” brokerage Ord Minnett said in a note.

Mr Horton accepted the job on a lucrative package worth up to $14m, boosted by a one-off payment of $4.5m in cash and shares to compensate him for leaving his London-based position.

Beazley manages five Lloyd’s syndicates, and last year underwrote gross premiums of $US3.56bn.

The company is a market leader in various lines including professional indemnity, property, marine, reinsurance, accident and life, and political risks and contingency.

During his tenure as CEO, Mr Horton profitably grew the business at an annual rate of 10 per cent, increased market value, and successfully added international businesses to a purely London-based operation when he joined in 2003.

QBE chairman Mike Wilkins said the company’s new CEO was known for driving positive change and high performance, and had built a well-respected business over a number of years.

The Ord Minnett note said QBE’s disclosure on remuneration targets was too generic to indicate the specific incentives for share price, return on equity or margins which Mr Horton had been set.

“There is always some risk when there is change of management that early on they are incentivised to rebase,” the note said.

“We believe Mr Pryce made efforts to suggest QBE had made some significant strides in repairing the strength of its reserves, although we are not sure the issues are completely resolved.”

Morgan Stanley said Mr Horton’s background as an external appointment with experience in Lloyd’s and the British market would not surprise investors.

“As Beazley CEO since 2008, Mr Horton gained market share and delivered strong premium growth, particularly in specialty, liability and cyber risk lines,” the investment bank said.

“He is familiar with the North American market as well.”