Data is Tanner Hackett’s fuel. He used it to bring ecommerce to Malaysia and launch Button, a mobile commerce marketing company. Now, the entrepreneur is leaning on data — and insurance experts — to bring management and professional liability insurance to small businesses.
He cofounded Counterpart in 2019 with the goal of making insurance professionals even more efficient and delivering more value for customers. The company uses artificial intelligence to deliver management liability services for small businesses. Counterpart also supports clients throughout policy life cycles with risk mitigation and claims management resources.
“We look at insurance as a tool,” Hackett explained, “to not only help to transfer risk, but also to help these small businesses mitigate some of the risks that they face. So, that’s where Counterpart sits. Counterpart … we’re an insurance platform that is underpinned by data and human experts that have seen these problems firsthand.”
Hackett is Counterpart’s CEO. He previously worked in the private equity, consulting, ecommerce and marketing tech industries and has co-founded two other startups in these industries. His entrepreneurial spirit led him to InsurTech.
“You have to, by nature, utilize technology, utilize the processing power of data to underwrite this business more efficiently to participate in this space,” Hackett said of Counterpart’s policyholders, which are businesses with fewer than 250 employees.
Justifying insurance carrier investment in large companies with big premiums is easy, Hackett said, adding that it’s harder when premiums drop to $2,000. Traditional carriers don’t typically have the infrastructure or incentive to make an investment and build the tooling to support those policyholders, he said.
“So, this was part in recognizing a gap in the market and part in recognizing that these small businesses are the ones that will feel the claim most directly,” Hackett said. “A $150,000 wrongful termination lawsuit could be game over to a small business.”
Management liability insurance plays a role in protecting businesses, assets, and personal assets of stakeholders in the face of modern exposures such as wrongful termination, harassment, discrimination, negligence, and misrepresentation.
Counterpart operates in the specialty lines slice of commercial insurance. The company offers directors and officers, employment practices, excess and fiduciary products, as well as miscellaneous professional liability insurance. Through data mining and advanced analytics, Counterpart’s rating systems measure risk while requiring less information from brokers and applicants.
The InsurTech’s products are underwritten by Aspen Specialty Insurance Company and Evanston Insurance Company, a Markel Company. Counterpart’s hardest challenge, Hackett reflected, was getting an insurance carrier partner to buy into its suite of tools and services.
In the years since, “we’ve been able to fulfill this promise – and exceed expectations, actually,” Hackett said. He added that Counterpart has been extremely fortunate to have “some of the most trusted and successful broker partners as our distribution.”
Hackett believes the value Counterpart offers as a resource to place coverage and terms has benefited all parts of the insurance cycle, particularly as company leaders aim to continue expanding its lines of insurance to support brokers in different ways.
“I think the larger opportunity, beyond just this underwriting front-end, is how do you connect the dots between underwriting and risk management?” Hackett asked. “Risk management being your tools for your policyholders to reduce the probability of a claim.”
He continued: “And then ultimately, when a claim happens … is to help the policyholder, the small business in our case, address that claim as quickly as possible, so they can get back to business. We spoke about data being applied to underwriting. I think there’s as big, if not bigger, opportunity for data to be applied to claims.”
Hackett spoke of how Counterpart’s insurance industry partners have taken a leap to join his company’s mission. They know it can and should be done better, and they want to have a hand in it, he said.
With this in mind, what is his advice to aspiring InsurTech leaders? Question assumptions.
“We see an opportunity to educate the market about their exposures,” Hackett said of Counterpart. “We see an opportunity to provide them with this coverage so they can sleep a little bit better at night. And then we also see the opportunity to help to grow a … luxury product line.”