The Worcester-based insurer announced its plans during it Investor Day conference
“This is an exciting time for us,” said Joseph M. Zubretsky, president and chief executive officer of The Hanover. “Our company is well positioned financially and competitively, is nimble and agile, and adept at delivering creative solutions to the market quickly and efficiently. We are intensely focused on growing responsibly in all of our businesses, managing volatility and generating strong returns for our shareholders. ”
With that optimistic introduction, Mr. Zubretskey unveiled The Hanover’s go-forward business strategy at its recent Investor Day conference on February 23rd. The insurer’s plans detailed in its five-year growth plan, entitled Hanover 2021, the company plans to focus on three key areas going forth:
- Leveraging the strengths of the company’s agent-centered distribution strategy,
- Significantly increasing its capabilities in the domestic and international specialty markets, and
- Investing in an innovation unit that will develop new growth solutions to help its distribution partners expand their businesses in rapidly changing markets.
Ultimately, Mr. Zubretsky believes that the successfully executing The Hanover 2021 plan will result in increased revenues and book value per share for the insurer in addition to generating “top-quartile returns on equity” over the next five years.
“The future of our marketplace will continue to be highly competitive and dynamic,” Zubretsky said. “We believe our company, together with our distribution partners, is uniquely positioned to thrive and that Hanover 2021 will drive profitable growth in our business and consistent returns for our shareholders.”
Reorganizing three lines of business into the one new division
As part of the plan, The Hanover announced that the company’s small commercial, middle market and personal lines businesses all would be combined into one new division. The new division, called Hanover Agency Markets, will be led by John C. Roche, who most recently served as the president of commercial lines for the insurer. As president of the newly formed division, Mr. Roche is charged with spearheading the insurer’s efforts to grow its business through its independent agency partners by “capitalizing on the company’s unique franchise value strategy and industry-leading agency analytic capabilities.”
Overall, Hanover Agency Markets’ aim will be to provide a much wider assortment of products and services to its agency partners to better serve their customers evolving needs. Besides investing in its relationships with its agency partners, the insurer also plans to “…enhance its existing offerings, selectively expand its risk appetite, pursue new customer segments, and grow its presence in under-penetrated geographic markets.”
The Hanover’s specialty business will become its own separate division
The Hanover will look to grow its specialty business both internationally and in the U.S. through a reorganization and a leverage of its existing capabilities.
As part of The Hanover 2021 growth plan, the insurer has decided to manage its domestic specialty business as a separate division within the company, with a search already underway for a new head of domestic specialty. Until that search has concluded, the business will report to Mr. Zubretsky directly.
As for The Hanover’s international specialty business, that division is written through Chaucer, “…a leading Lloyd’s syndicate whose hallmark is underwriting large, complex global risks in major insurance and reinsurance classes.” This business will be overseen by John Fowle. Mr Fowle, who has over 25 years of London market underwriting experience, has been with Chaucer since 2002, having held many key roles at the insurer including chief underwriting officer and active underwriter of Chaucer’s main syndicate, 1084.
Innovation will also be a main focus of the company going forward
Realizing that innovation will be a key factor for the company over the next five years, The Hanover also announced that it will be forming a separate unit dedicated to innovation. Among the goals for this new unit will be driving innovation across the insurer’s businesses, along with identifying the new emerging segments in the customer sphere. The new innovation unit also plans to implement greater leverage of the company’s data and analytics which will ideally also help The Hanover’s independent agents innovate and strategically grow their businesses as well.
Richard W. Lavey, most recently The Hanover’s President of Personal Lines & Chief Marketing Officer will oversee the new unit as Chief Growth Innovation officer. In this new position, Mr. Lavey will oversee the insurer’s efforts with respect to developing innovative business models for the company’s agency partners in order to help independent agents evolve with the rapidly changing marketplace.
In addition, Mark L. Berthiaume will serve as Chief Technology Innovation Officer. Mr. Berthiaume, who most recently held the position of Chief Information and Administration Officer, will now be charged with creating and deliver technology-based solutions for the company’s partners and customers. Among those services are digital platforms to the partners and predictive analytics.
As for the rest of The Hanover’s organizational structure, the remaining members of the executive leadership team will continue on in their current roles.
