Bruce Eisler was appointed CEO U.S. and chief underwriting officer at Aspen Insurance Holdings Ltd. in June 2020. He has overseen a refocusing of Aspen’s book of business that took place after the specialty insurer and reinsurer was bought by Apollo Global Management LLC in February 2019 for $2.6 billion. Mr. Eisler recently spoke with Business Insurance reporter Matthew Lerner about commercial insurance market conditions, emerging from pandemic lockdowns, technology and other issues facing the insurance industry. Edited excerpts follow.

Q: How has the hardening market affected Aspen, and what is the near-term commercial rate forecast?

A: For many of our property/casualty lines, we continue to see favorable market conditions. Some lines of business — excess casualty, for instance — have had rate increases for three years. We’ve seen rate on rate on rate, and it’s continuing, but at a more modest pace than prior years. 

We are largely in a favorable market environment, and I think it will be sustained for another couple of years, maybe not as dramatically as we’ve seen in the last couple of years, but I still think it will remain quite firm.

The insurance industry has some ground to make up because of extended periods of losses and underpricing. We’re doing a reasonably good job of that right now, but we really need these rate increases and changes in terms and conditions, which I think will be with us for a while longer.

Inflation could become an issue for our insureds and for us, and it needs to be contemplated in our pricing. 

Q: How has Aspen changed and adapted over the recent past?

A: We had a reorganization and restructuring that effectively started when Apollo Global Management LLC closed its transaction to buy Aspen for $2.6 billion in February 2019. The deal was first announced in late August 2018. Aspen really focused on reducing the complexity of the organization. We consider ourselves a specialty insurer and reinsurer. In order to remain that, we narrowed down our product set to a more limited offering. We de-emphasized certain businesses and emphasized the businesses where we are an established and relevant market. 

Now, we’re in the lines of business in which we’ve historically done well, and have the alignment of the stars that we have more favorable market conditions in those lines of business. Areas to which Aspen is committing additional resources include the financial and professional lines, such as management liability, professional liability and transactional liability. Cyber and casualty lines have also seen growth, not only in primary and excess casualty but environmental and railroad as well.

We took steps to narrow our focus, so the lines we are focused on are all growing, are all specialty and are all lines where we anticipate growth going forward. Accident and health was one of the areas which was de-emphasized.

Q: What types of plans is Aspen making as far as emerging from the pandemic, and has the recent resurgence of the virus become a complication?

A: When we look at offices here and in the U.K., we are beginning to plan for the future. We’re planning for what will eventually be a new normal — new working patterns largely around a hybrid model that, in most offices, will be two or three days in the office situation. This will vary by role and could also turn on other variables, such as the seasonality of a given business. There will be more modern, flexible workspaces with dedicated areas for collaboration. The novelty of working from home can turn very quickly into living at work and we need to be mindful of that and take steps to ensure it won’t happen.

Our planning for this contemplated this precise possibility that we’re looking at now, the potential for “extra innings.” We contemplated the likelihood for that and other issues and tried to take a very considered approach to this.

Q: How does Aspen see technology fitting into its business?

A: Technology has several components. Every company, Aspen included, is looking to improve its financial metrics through technology, and technology is definitely one of those levers that should enable us to improve our financial metrics. 

Your technology also really needs to enable you as an insurance company to efficiently and effectively address reporting and regulatory requirements. Those things are necessary, they should not be difficult, and technology handles that more efficiently than any other fashion.

A very necessary component for any information technology manager and budget is certainly to focus on cybersecurity and resilience.

Q: Will the insurance industry continue to consolidate?

A: If you look at what’s been going on with the broker side of things — such as Ryan Specialty going public and doing very well — I would think that’s indicative of a favorable view of that space. There is a lot of activity, and I wouldn’t be surprised to see more in that particular arena.

From a larger perspective, Aspen is a large writer of transactional liability. Mergers and acquisitions, which declined during the COVID-19 outbreak, have now come back to levels as strong if not stronger than prior to the pandemic. There’s a great deal of merger and acquisition activity taking place and that has been the case for a substantial portion of 2021, and we are seeing opportunities in representations and warranties insurance. 

Q: How do you see overall economic conditions bearing upon the insurance industry?

A: Economic conditions are favorable, which is favorable for insurers. Many of our clients are seeing strong revenue growth themselves. They’re benefiting from the favorable economic conditions and right now are in a pretty good position. Insureds have a very robust pipeline of business and opportunity, and revenues are increasing year over year. 

The issue of inflation is probably the one we want to keep our eye on the most.

Inflation could become an issue for both our insureds and us. Inflation is meaningful, and it is incumbent on us to act on that now