Tangram’s Bernard: MGA has the benefit of tenure but mentality of a start-up

The head of strategy at Tangram Insurance Services has said the two decade-plus old firm has the benefit of experience and the mentality of a start-up, as she outlined areas for potential organic and inorganic growth at the MGA platform.

Talking to The Insurer TV at last week’s Target Markets Mid-Year Meeting in Tampa, Florida, Bernard spoke emphatically about the need for MGAs to bring specialist expertise.

Tangram has been around since 1999 and writes in the vicinity of $150mn in premium across 10-12 distinct verticals where the MGA supports insureds on a multi-line basis.

“We have the benefit of operating a business that's been around for a long time, but with the mentality of a start-up,” Bernard said, adding that the MGA has “really come into [its] own” over the past decade.

“We try to be a little bit of everything within the niches in which we operate, but specialty, so things that are focused on very specific niches, such as fuel dealers, propane dealers, and security guards – things that are particularly unique,” Bernard explained.

Areas that Tangram has earmarked for growth are supporting existing insureds with additional products.

“How do we round out the things that we have? If we've got a workers’ compensation program for security guards, how do we bring package lines to support that? What other lines of business do niches need?” Bernard outlined.

“Whether it's cyber or active assailant, how do we bring new products to the existing niches to make ourselves a one-stop shop for our insurance and our brokers? So I think that's the first way we think about growth,” she commented.

Organic and inorganic opportunities

New organic program development, Bernard said, would depend on the ability to hire talent, or if a broking trading partner would be looking to consolidate a book of business with the MGA.

“And then I think M&A, of course, is always part of our growth strategy as well,” describing any potential M&A as a “complementary” pathway to adding new business.

“It's all part of the growth strategy. I don't think you can grow without having a little bit coming out of each of those buckets,” Bernard explained.

On capacity, the MGA executive said her firm isn’t seeing much in the way of carriers pulling back, but rather deploying more capacity to the programs segment, echoing comments made by other attendees at the mid-year event.

“If anything, there's more capacity being deployed, and more capital being deployed into the program space,” Bernard noted.

“I think that programs where we see success is where we're serving a purpose that maybe the larger market, the traditional P&C market, can't serve, whether that's a niche, a coverage, or whatever it is that you can't get from the standard market, and I think program carriers see the expertise of the program administrator in the niches that they operate in,” she added.

“I don't think there's really a generalist play in the MGA space. And I don't know that there will be,” Bernard explained.

Bernard said flexibility in structuring programs has helped attract diverse sorts of capacity to the market, ranging from pure fronts to hybrids to traditional program carriers.

“And I think carriers have flexibility in how they construct your programs, whether that's [through] profit shares, net retentions, or things like that, but that's really where we want to play,” she commented.

“We want to diversify our capacity providers, but I think that having some of that flexibility is important,” Bernard added.

She also spoke about how Tangram is committed to its “core values”, “being independent” and “growing in a responsible way”.

“We're obviously committed to diversity and inclusion. We're a majority-women-led company, which I think is rare in our industry, and we're really proud of it,” she explained.

“We're really looking to grow something and continue to grow it, but do it on our terms. That's essentially what we're looking to do to maintain our independence and have fun doing it,” Bernard concluded.

Watch the full interview with Tangram’s Tracy Bernard to hear more about:

  • How Tangram benefits from both incumbency and a start-up mindset
  • Areas for organic and inorganic growth at the MGA platform
  • Why capacity in the MGA is growing and not shrinking
  • Tangram’s independence unique status as having a female-led management