Former BlueChip executive Ben Welch is set to begin underwriting a new transactional liability program on the Balance Partners platform and is understood to have secured capacity from high quality A rated carriers ahead of a 1 November launch, Program Manager can reveal.
Welch is head of Archer Transactional, the latest core program on the Michael Sillat and Joe Calise-founded MGA platform which will initially offer up to $15mn in capacity per policy through year-end.
The underwriting outfit is then expected to expand its offering to up to $25mn beginning at 1.1, a level that would allow the start-up to write primary layers on a wide range of deals. Welch handled representation and warranty (R&W) claims at law firm Peabody and Arnold in Boston before moving to the underwriting side of the business more than eight years ago. And speaking to this publication he said had decided to strike out and join expansive Balance Partners to bring the experience of his underwriting career and build a “robust and efficient end-to-end transactional liability platform”. “I want to provide the highest level of service form the submission stage right through to claims resolution. Joe and Michael have built a great platform and I thought this would be a great way for me to do that,” he explained.
Archer Transactional will offer the full range of transactional liability insurance products, including R&W, contingent liability and tax indemnity policies, typically distributed through the larger retail brokers.
The MGA will focus on the middle to lower middle market but will entertain a wide range of deal size in an M&A market that is expected to generate strong submissions in the mid-term even if there is a near-term tail-off due to the challenging macroeconomic environment. Welch said that there remains plenty of scope for a start-up to the sector, despite a significant number of new entrants in recent years. He pointed to the amount of private capital including private equity that continues to drive activity and is expected – according to some forecasts – to double by the end of the decade. “So I’m expecting a very robust market, maybe not in the very short term, but definitely in the medium to long term,” said Welch.
Differentiated approach
The executive said Archer Transactional will be differentiated by its strong reputation in covering transactions in the healthcare industry, a broad, and growing suite of coverage products, and by a tech-driven approach to underwriting and a highly efficient and robust operating platform. “We’re doing some tech-enabled things to help improve risk selection and we have a technological foundation that will allow us to collect, analyze and learn from all the data associated with deals,” he explained. These will add value to carrier partners, he added, while insureds will benefit from a commitment to providing partnership with brokers, lawyers, and buyers of these policies and “excellent claims handling service”.
Balance Partners co-founder and former WKFC CEO Sillat said that in a tightening market securing carrier capacity had been a challenge the firm had been able to overcome. “We’ve got, in our opinion, one of the best underwriters in the business, who is really looking forward to an entrepreneurial play, and a really impressive suite of carriers to support Archer Transactional,” he added.
Balance Partners heads towards $200mn GWP
Archer Transactional represents the ninth core program launched by Balance Partners as part of a dual-track strategy which also sees it generate revenue from its BP Admin Services division by providing infrastructure to other MGAs. There are now four MGAs on the platform under the BP Admin Services division.
The 13 programs combined are projected to finish up 2022 at around $200mn in GWP, representing over 50 percent growth from last year. The nine core programs will contribute around $115mn to the total, with the balance coming from the four BP Admin Services programs, including Greg Flood’s ATRI company. In addition to Archer Transactional, the core programs include Aspyre, Impulse, Mistral, Pentium, Poseidon, Maven, RailPro and Steward (see table).
Sillat and former Guy Carpenter executive Calise have been able to bring strong insurance and reinsurance carrier relationships to the start-up to create not only a strong panel of capacity providers able to support the growing portfolio of in-house and third-party programs but also in the structuring and placement of facultative placements on larger risks that their underwriters require from time to time. Calise told this publication the platform is designed to align the interests of capacity, the MGA and individual underwriter. Underwriters are provided access to insurance and reinsurance capacity, distribution, admin services and systems. “Michael and I spend the lion’s share of our time identifying talented, capable people with a track record of underwriting profitability and we assist to provide them with whatever resources they need to empower them,” he said.