CFC boss on company expansion | Insurance business America
“Brokers can really benefit from having decision makers on site.”
London-based CFC Underwriting, one of the world’s largest independent managing general agents, serves more than 100,000 companies in more than 90 countries and counting.
Insurance Business recently spoke with CFC USA CEO Shannon Groeber (pictured above) about the company’s expansion, its intention to expand its footprint and its focus on the middle market.
IB: CFC seems to be on a growth path. Can you tell us something about it?
Groeber: We have a team that has served customers looking for cyber solutions across the spectrum, from small businesses – which CFC has focused on since our founding in 1999 – to the Fortune 10 -Companies looking for capacity. But the reality is that CFC’s strategy, which entered the U.S. more than four years ago – and has followed suit in other areas – is to open up options and give more access to the brokers who serve those customers.
[We want to] Make sure they have decision makers who are available in their local time zone and in real time. …So, knowing how important it is, especially for mid-market clients, it naturally fits with our strategy to use underwriters locally – starting in New York, but in local time zones that can really benefit the brokers from decision makers, who are on site.
IB: Will this be accompanied by an increase in M&A activity or headcount?
Groeber: It will be accompanied by an increase in personnel. I’m hoping we’ll get some announcements in the short term. But we’re going to start with a team focused solely on production and underwriting and just grow this book organically. If we meet the market’s expectations – and do so in a way that I know serves the brokers and the customers – I expect this team to grow. We are targeting three underwriters initially and will hopefully add additional resources to this team in 2025.
IB: How about acquisitions?
Groeber: Historically, CFC has not been a very acquisitive company in terms of underwriting capacity. Of course, we have made some acquisitions in both the US and Australia in the incident response space and some other companies that further our goal of being a leader in technology and use of AI and data insights.
We have just announced the acquisition of an underwriting company in Australia. … This is really, in my opinion, the first real underwriting acquisition that we’ve done. … Australia is very exciting for us. It’s been an area where CFC has really grown across a number of our products [we’re] I’m just continuing to expand that reach.
We’ll be making a few more announcements and following up in other territories that have been key for us, including Canada, so we’re not ready to share the details there yet. …And I expect we will see further organic growth and acquisitions in other key areas where it makes sense. Greater Europe is of course a different area; We have a huge workforce in the UK, but there is no substitute for understanding local needs and the local economy and building and maintaining relationships with the brokers who serve these areas.
IB: What motivated you to focus on medium-sized businesses?
Groeber: When we founded the company in the US, we focused on approved cyber solutions for small businesses – a very untapped market and one where there is a great need but, in my opinion, is not clearly communicated to the end customer. We added transaction liability in the US at the end of 2023.…
Ultimately, we look at the products where we are very confident that we are offering something that is innovative and differentiated. We have the products, the valuation models and the claims experience to enable us to offer something that will be of value. And when we look at the middle market and the parameters that we set around the approved cyber product that is offered in the U.S., we can see much greater demand that goes beyond the parameters that we set for that product.
The approved product is a great solution for a range of customers, but will not be the right solution for every customer due to limitations in negotiating insurance coverage. [We decided] Adding mid-sized cyber underwriters locally in the US would only improve our offering, not necessarily cannibalize it. It’s not necessarily about taking work away from the team in London, it’s just about ensuring we can serve all customers looking for capacity.
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2024-05-23 15:51:32
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