Two years after launch, Mosaic Insurance is hitting all its targets
Two years after its launch, things are going exactly to plan for Mosaic Insurance, the Bermudian-based specialty carrier backed by private-equity firm Golden Gate Capital.
The company writes seven specialty lines – transactional liability, cyber, political risk, political violence, environmental liability, financial institutions, and professional liability.
They do so out of seven offices – Bermuda, London, New York, Chicago, Toronto, Frankfurt and Dubai – with an eighth underwriting hub, in Asia, expected to open soon.
And all of it – the lines and locations – was meticulously planned out before the company launched, including a timeline for the introduction of each of the business lines and the opening of offices, plus the people, the structure and the partners.
Seasoned executives Mitch Blaser and Mark Wheeler are the co-chief executive officers of Mosaic, leading a staff that has grown to 125 worldwide, including 11 at global headquarters in Bermuda.
Mr Blaser said: “Everything that we have executed is 100 per cent aligned with our business plan. We knew what we wanted to do before we started.”
The seven specialty lines require experienced underwriters with a high degree of technical ability, as well as a keen awareness of the state of the world.
Mosaic has also recruited a top-class claims team.
Mr Wheeler said: “In terms of our progress, one of the things we are most pleased about is the people we have attracted to the team.”
Mr Blaser said: “Once we had discussed and thought about what those seven lines would be, we were being partially informed by the people and businesses we knew. So, there was a symmetry to going out and recruiting them.”
Mr Wheeler added: “The lines were very carefully thought through. We identified the lines before we identified the people and often when people set insurers up, they do it the other way around. They have access to talent and then follow the business. We turned that on its head.
“We set out some characteristics of a portfolio that we felt would clearly be able to outperform the market on profitability and growth.
“We worked through a template of what those characteristics were, and then overlaid that on the market, and that’s where we got our seven lines from.
“So (the lines are) very carefully chosen, intentionally incredibly narrow, but really, importantly, over the next five-plus years, we want to take those seven lines very deep globally – and Golden Gate Capital, our anchor shareholder, understands that.
“Within our seven core competencies, our intention is to be global market leaders in those markets.”
Mr Blaser said growth will come in a measured manner from the penetration of those lines via Mosaic’s geographic hubs (rather than by a big-bet approach, as can occur in the property cat sector).
He added: “In our world, it’s going to be brick by brick – but there’s a ton of bricks out there and the buildings can get as high as you want to make them.”
Precise pre-planning was required in large part because of the company’s hybrid structure – it writes business on its own behalf through Syndicate 1609 at Lloyd’s and for a consortia of trade partners seeking regional access and underwriting expertise in non-commoditised lines.
Mr Blaser said: “If we were following a road map of somebody else, we would have had deviations, a different take on an already established route. But Mosaic was really the execution of a whole new structure, and it had to be really well mapped out – and we stuck to it.”
Mr Wheeler added: “We have been blazing a trail. This is a new model that we were very clear on around syndication. Importantly, in that connection, our principal shareholders at Golden Gate are distinguished by having permanent capital.
“That is relevant because what we are doing is not a high-volume, opportunistic market play. This is very much a differentiated business model.
“It is sustainable, it takes longer to build out, it is insurance, not reinsurance, our individual contract values are lower.
“When all is said and done, we are here to create value and it just takes longer.”
Mr Wheeler characterised Mosaic as an “underwriter’s underwriter”.
He said: “One of the things we are really pleased with – we have contracted with 20 other insurance companies to write on their behalf.
“In a hard market, carriers in the industry tend to pull back on delegating their authority to others. So, for us to be able to execute that in this period is a great testament to the people we have hired and to the sustainability of the business model.
“If you can build it in this market, we are very confident it will stand the test of time.”
Mr Wheeler said Mosaic is a one-stop syndicated market, which clients have responded to.
“What we have done, in essence, is create the ability of clients to access that syndicated product rather than having to go to London.
“What that geographic footprint does for us – in our core competencies, the lines we’re in – is that it gives us access to about 75 per cent of the global market, and our Lloyd’s paper gives us licenses in over 70 countries, and all of that we can operate from here in Bermuda. It is a phenomenally powerful structure.
“One other really important component, looking back over our progress, is the creation of the partnerships we have, and that extends beyond our non-aligned capital partners. Our tagline is ‘partnership with purpose,’ so it’s very much at the heart of everything we do.”
Mr Blaser said Mosaic has developed artificial intelligence/machine learning applications to help with underwriting, understanding specific lines of business, and using algorithms to ascertain how a risk aligns with Mosaic’s appetite.
“Rather than a whole bunch of underwriting assistants, you have technology supporting your underwriters, pulling upon both external and internal data points as a way of informing them – and, over time, enhancing response time. That is an area we see more opportunity to invest in and will stimulate more growth.”
Mosaic has an exclusive insurance partnership with market-leading Safe Security of California, which has a cyber-risk assessment platform, SAFE, that offers a real-time view of the extent and nature of a company’s enterprise-wide cyber-risk, allowing the most accurate exposure analysis, coverage and pricing for brokers and insureds.
The company said SAFE platform’s machine-learning models predict the likelihood of cyber breaches across a corporate environment. SAFE simultaneously accumulates signals – using APIs – from existing cybersecurity products, external threat intelligence and business context to provide unprecedented visibility into possible cyber exposure.
Mr Wheeler said: “That is a big step away from being a traditional insurance carrier in terms of capability.
“It is very powerful, but it is also a really important component part of why somebody would pay us to underwrite on their behalf. This is access to inside-out data that just isn’t available in the market today. It is exceptional.”
As for the company name, Mr Blaser said: “We carved out what we thought were the best aspects and business structures of the insurance industry traditionally and put them together into this new framework – and that’s why we called it ‘Mosaic’.”
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