While InsurTech carriers selling personal lines insurance see software licensing deals as new avenues to growth, a technology company operating in the special niche of catastrophe-exposed property has found success moving in the opposite direction.
Executive SummaryThe CEO of SageSure, Terrence McLean, describes the evolution of a startup technology firm, launched to license specialized software to insurers writing property risks in underserved coastal areas in the aftermath of hurricanes Katrina, Rita and Wilma, into an MGU that leverages the technology and relationships with multiple carriers to offer consistent capacity to agents struggling to place that business for middle-market insureds.
Terrence McLean, chief executive officer of SageSure, a Jersey City, N.J.-based managing general underwriter, explains that the initial business—a technology company known as Insight Catastrophe Group—still exists and generates about $3 million of revenue per year. But the MGU, which produced over $462 million of premiums for carrier partners in 2019, is now the main focus of the company.
SageSure, which writes middle-market primary personal property insurance for a handful of carriers in underserved coastal areas, uses technology that scores the impact of adding each individual property risk (or set of risks) to a portfolio. With bigger investments in that kind of technology than traditional national homeowners carriers have made, SageSure has an edge in underwriting and pricing underserved risks, McLean told Carrier Management during an interview in January. “It’s not that they’re not smart enough or capable. Of course they can do that. They just decide that’s not where they’re going to put their investments because they’re not focused on that area,” he said.
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