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Ironshore seeking partners for syndicated business

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Six years ago, Ironshore opened its doors in Bermuda, with three experienced senior executives, $1 billion in capital and some ideas.

Today, the company has grown into a significant player in the global specialty insurance market, employing 460 people around the world and writing about $1.65 billion in premium in 2012.

In Bermuda, Ironshore’s operation is based on the seventh floor of Seon Place, where the company employs 56 people. From there it writes property insurance and excess liability lines through IronStarr, its joint venture with CV Starr & Co.

The company has branched out to write coverage for a wide range of specialty offerings including construction, environmental, financial and commercial risks through 23 offices in seven countries. As it does not write any reinsurance, it does not adhere to the regular “Bermuda model”.

One of the executives who has been in from the start is Mitch Blaser, CEO of Ironshore’s Bermuda operations and chief operating officer of Ironshore Inc.

Speaking with

The Royal Gazette in Ironshore’s Bermuda offices on the seventh floor of Seon Place, Mr Blaser said the company was growing premium at a rate of 20 percent per year and he believed that would continue in 2013.

On the advantages of a network spread around the globe was that Ironshore could “see the market” rather than write business from a remote environment, he said.

With an eye on growing its Bermuda business, Ironshore is looking to apply the model of its joint venture with CV Starr with other partners, Mr Blaser revealed.

“We’re hoping for a couple of additional partners,” He said. “The Bermuda market lends itself to the syndication concept and this is really where the market can differentiate itself in what we are offering.”

He said he was not at liberty to reveal names of companies Ironshore hoped to partner with.

Ironshore is still privately held and has no plans to go public any time soon. For one thing, Mr Blaser said, there was no urgent need to do so.

Investors including six private-equity firms were happy to focus on building the company for now.

“There are no pressures for a liquidity event,” Mr Blaser said. “It’s a good time to build as a private company right now. We don’t have the regulatory issues that public companies have to deal with and capital management is a also whole different process for public companies. Also the industry is trading at a discount to book value, however specialty insurance companies like ours are not.

“At some point we will be looking at the public markets, given the need for capital as you grow, but nothing is imminent for now.”

Mr Blaser remembers the excitement of starting up when Ironshore first set up in its former home, the Swan Building in Victoria Street.

“I recall saying that, ‘The good news is that we have a blank piece of paper — and the bad news is we have a blank piece of paper’,” Mr Blaser said. “You start with no history, no HR policy, no pencils. And you can’t blame failings on the way the place was run before you.”

Over the past six years, that initial $1 billion of capital has been put to work successfully.

Having built out its operations in the US, Canada, the UK, Australia, Singapore and India, as well as Bermuda, Ironshore has tried to streamline support services for all underwriting operations through an entity called IronServe, launched a year ago with Mr Blaser as its CEO.

The main body of IronServe’s work is done through its office in New Delhi, India, where it employs around 300 people. The IronServe operation is about 85 percent rolled out, Mr Blaser said.

Mr Blaser attributes Ironshore’s successful six years to a number of factors. Firstly, leadership of Kevin Kelley, who arrived from Lexington Insurance in 2008 to take over as CEO. Second the company’s international presence and thirdly, the talent the company was able to recruit. Among the hirings were a string of senior executives from American International Group. This had partly been made possible by the effects of the global financial crisis, he suggested.

“The people who Kevin Kelley was able to bring in, we would probably not have been able to attract in the ‘old world’,” Mr Blaser said.

Another impact of the crisis that had worked in Ironshore’s favour was a distinct shift in corporate risk management practices. Probably because of the travails of business insurance heavyweights like AIG and XL in 2008 and its aftermath, risk managers had opted to “spread their programmes around, rather than putting them all in one place”, leading to opportunities for Ironshore, a start-up free of legacy issues.

Six years of progress: Ironshore's Bermuda CEO Mitch Blaser, pictured in the company's offices on the seventh floor of Seon Place (Photo by Glenn Tucker)
Ironshore's Bermuda CEO Mitch Blaser (Photo by Glenn Tucker)

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Published January 18, 2013 at 8:00 am (Updated January 17, 2013 at 7:36 pm)

Ironshore seeking partners for syndicated business

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