CRC’s Kessler: Data has enabled delivery of exclusive capacity to retail clients
CRC Group’s focus on gathering data around loss exposure across its portfolio has enabled it to deliver exclusive capacity to its retail clients, according to the firm’s president and COO Neil Kessler.
Speaking to The Insurer TV while attending the WSIA Annual Marketplace 2023, Kessler said that as a wholesaler, CRC is securing capacity both on an open market basis and as a delegated authority underwriter, through the Starwind Specialty programs platform that was created following the acquisition of Constellation Affiliated Partners.
“We’ve spent a lot of time trying to secure capacity that’s just for us, that our retail clients can get just from us right at CRC Group,” said the executive.
He highlighted an initiative that started in 2016 to gather loss exposure data on every account the firm binds, to then put together programs to deliver capacity solutions that are unique in the marketplace.
“And that’s having a really big impact. So it’s been a huge focus for us… how to bring exclusive capacity to the market,” said Kessler.
He noted that Starwind Specialty is a big user of fronted capacity and reinsurance relationships.
“A lot of that is how do we go to market? How do we use reinsurance? How do we use collateralised reinsurance to bring capacity to markets that we see opportunities in? And it’s going really well,” Kessler continued.
E&S market like nothing seen before
Kessler was also asked about the current state of the E&S market, which is set to grow well beyond $100bn this year and now accounts for more than 20 percent of the US commercial insurance sector after double-digit percentage growth for five years in a row.
“We've had hard markets here or there, but nothing quite like we've seen lately,” the executive commented..
Kessler attributes the growth in the E&S market to a changing world.
“I think the E&S market is doing exactly what it's designed to do, it’s designed to be an outlet when the world gets riskier, [so that] when standard lines markets pull back, there's an option for business owners,” said Kessler.
“And I think it's working kind of as it was envisioned, and as it was designed. Is it bigger? Yes. But it's also because the world is a riskier place.”
He added that standard lines markets now have potentially more discipline and more data to make better decisions faster and sooner, explaining current E&S market trends and the flood of business into the channel.
Employee benefits opportunity
CRC Group will write and place about $40bn in premiums this year according to Kessler, in part because of last year’s acquisition of Dallas, Texas-based BenefitMall, the largest employee benefits general agency in the US.
Kessler said the deal is on track.
“I think it's performed as we expected,” said Kessler. “I kind of see wholesale EB as where wholesale P&C was, let's rewind the clock six, seven years…so a lot of opportunity ahead.”
He said that the employee benefits market is currently “very unconsolidated” compared to the P&C wholesale sector.
Kessler suggested that, backed by the relationships CRC has at the group level with retail agents, it will be able to capitalise and help consolidate the employee benefits space.
Watch this 8-minute video to learn about:
- CRC’s focus on delivering exclusive capacity to retail clients
- Why the E&S market is functioning as intended
- How the BenefitMall acquisition is looking, one year on
- Why Kessler believes wholesale employee benefits is a growth area