Through our Insurance Company Subsidiaries, we offer insurance coverage in
both specialty commercial and specialty personal product lines. Currently, we
are authorized to write insurance as an excess and surplus lines (“E&S”)
carrier in 44 states, we are licensed to write insurance in 29 states as an
admitted carrier and we offer our insurance products in all 50 states.
Many of our products are targeted to profitable classes of policyholders that
we believe are underserved by other insurers. We market and sell these insurance
products through a growing network of over 5,500 independent agents that distribute
our policies through their approximately 2,200 sales offices. We are focused
on growing our business in non-commoditized property and casualty insurance
markets, while maintaining underwriting discipline and a conservative investment
strategy.
We have substantial expertise in serving the unique commercial insurance needs
of owner-operated businesses in the following markets:
Hospitality, such as restaurants, bars, taverns, and bowling centers (that require,
among other lines, liquor liability insurance), as well as small grocery and
convenience stores;
Artisan contractors, such as plumbers, painters, carpenters, electricians and
other independent contractors; and
Security service providers, such as companies that provide security guard services,
security alarm products and services, and private investigative services.
In our commercial lines business, we seek to differentiate ourselves and provide
value to small business owner-operators by bundling different insurance products
that meet a significant portion of their insurance needs. For example, in the
hospitality market we offer property, casualty, and liquor liability, as well
as, in some jurisdictions, workers’ compensation coverage. The breadth
of our specialty commercial insurance products enables our small business customers,
many of whom do not have dedicated risk management personnel, and their agents
to save the administrative costs and time required to seek coverage for these
items from separate insurers. As such, we compete for commercial lines business
based on our flexible product offerings and customer service, rather than on
pricing alone.
We also have substantial expertise in providing specialty homeowners’
insurance products to targeted customers that are often underserved by larger
carriers or other established providers of homeowners’ insurance. Our
personal lines products primarily include the following:
Catastrophe coverage, including hurricane and wind coverage, to underserved
homeowners in Florida, Hawaii and Texas; and
Dwelling insurance tailored for owners of lower valued homes, which we currently
offer in Illinois, Indiana, Louisiana and Texas.
In our personal lines business, we target homeowners in need of specific catastrophe
coverage or dwelling insurance that are currently underserved by the insurance
market, due to the modest value of their homes or the exposure to natural catastrophes
in their geographic area. Because these homeowners are underserved, this portion
of the market is typically subject to less pricing pressure from larger nationwide
insurers that offer a more commoditized product. We believe our underwriting
expertise enables us to compete effectively in these markets by evaluating and
appropriately pricing risk. In addition, we believe our willingness to meet
these underserved segments of the personal lines insurance market fosters deeper
relationships with, and increased loyalty from, the agents who distribute our
products.
We have built our business in a manner that is designed to adapt to changing
market conditions and deliver predictable results over time. The following highlights
key aspects of our model that contribute to our balanced approach:
Focus on underserved markets. We focus on providing specialty insurance products
to targeted policyholders in underserved markets. We believe that most of our
small business customers, many of which are owner-operated, value the efficiency
of dealing with a single insurer for multiple products. By targeting small-
to medium-sized accounts, we add value to the business owner directly without
competing solely on price.
Deep understanding of the business and regulatory landscapes of our markets.
The competition for insurance business and the regulatory operating environment
vary significantly from state to state. Our business plan includes identification
of market opportunities in particular jurisdictions where due to regulatory
conditions, our insurance products can profitably suit the needs of our potential
customers. We focus on tailoring our business to concentrate on the geographic
markets and regulatory environments with the greatest opportunities for growth
and profitability.
Emphasis on flexibility. We offer coverage to our insureds both on an E&S
and admitted basis. We believe this flexibility enables us to pivot effectively
between E&S and admitted policies as customer needs and regulatory conditions
dictate.
Strong relationships with our agents. We seek to develop strong relationships
with our independent agents and provide them with competitive products to offer
policyholders, responsive service and attractive commissions. We believe our
agents understand that we view them as key partners in risk selection that help
us serve our ultimate client-the insured.
Conservative risk management with an emphasis on lowering volatility. We focus
on the risk/reward of insurance underwriting, while maintaining a prudent investment
policy. We employ conservative risk management practices and opportunistically
purchase reinsurance to minimize our exposure to liability for individual risks.
In addition, we seek to maintain a diversified liquid investment portfolio to
reduce overall balance sheet volatility.