Skyward’s Robinson: Specialisation over scale key to success amid E&S market boom
Skyward Specialty CEO Andrew Robinson has said that having a strongly specialised product set is more crucial to success than scale in the current market, while also commenting on the trend of business flooding into the E&S channel.
Speaking to The Insurer TV, Robinson acknowledged that “every day our broker partners are getting larger and more sophisticated”.
Robinson’s comments come at a time of growing interest among the major retailers in potentially re-entering the wholesale channel, almost two decades after divesting their wholesale subsidiaries.
“Our belief is that the more specialised we are, the more distinctive our products, the better quality our people and our responsiveness to our brokers’ needs – the better position we are in the marketplace,” Robinson said.
“Size isn't the determinant of your success, but rather, the specialisation and the relevance of your solutions and your speed and your responsiveness to deliver,” he added.
Robinson was speaking after Skyward delivered its best-ever Q3 combined ratio of 90.2 percent, with the executive highlighting aggregate price increases in the mid-teens and submission flow at the carrier up 20 percent from last year.
With its results, Skyward said 54 percent of its writings in the quarter were in the non-admitted channel, while 52 percent of premium in the period came from short-tail lines.
Skyward’s chief executive said that whether business moves back into the retail channel or continues trending into wholesale, his company has “defined our business pretty clearly about the ways to access us”.
“But the most important thing is that our business is built around these highly specialised solutions,” Robinson argued.
He used a recent example of his firm’s management liability team writing “a terrific risk” for a business in the Web3 segment, an industry of firms centred around the use of blockchain technology.
“There's only a small number of folks that can compete against us in that area. We understand the category incredibly well,” he explained.
“And what I can assure you is that the right distributors are going to seek us out to be able to address that kind of need,” he continued.
“And the more that we can build our business around that, the better situated we're going to be, regardless of the distribution landscape,” Robinson commented.
Market of micro-cycles
The executive was also asked about the phase of the pricing cycle the market is currently in.
“We don’t believe in this notion of a single cycle, it’s been a series of micro-cycles for quite some time now. Even when I came into Skyward three and half years ago we were right at the front edge of what was this crazy public D&O hard market.
“We saw that in excess for a while, and in cyber. But in each of these you’re seeing – certainly in the public D&O side – the other side of that very quickly. In cyber, we’ve seen rates come off,” Robinson commented.
He said by and large, Skyward’s book has been built in places where the market is more orderly, with consistent, good rate.
Robinson described the current market as orderly, without irrational behaviour.
“That’s the kind of market where we accelerate as a company and I think most of our business seems to be in those kinds of categories.
“We think that there’s plenty of opportunity for us to take advantage of the market and to meaningfully, while adding margin, outgrow the respectable peer growth that we hold ourselves in comparison to,” Robinson continued.
Despite widespread commentary about the woes in areas such as public D&O, the executive said the carrier sees opportunities within the professional liability sector.
He identified miscellaneous professional lines, along with specific areas like architects and engineers as well as financial institutions, cyber and healthcare professional liability.
“In that mix, we have very specific areas where we see very attractive market opportunities. It’s been a very strong trajectory,” he commented.