Hello from Target Markets!  It was another busy week and conference season is moving along.  Meanwhile, the insurance industry continues to prove its mettle, evolving dynamically with each passing week. As we look at the happenings of the week, it becomes evident that the sector’s resilience and adaptability remain steadfast. From strategic investments and partnerships to the ever-increasing role of data and analytics, the industry stands at the forefront of innovation and transformation – let’s delve into the three things we learned this week and tell the story of our industry.

 [1]

Insurance Assets Continue to be Valued

Profitable insurance assets continue to hold high value beyond just the insurance world.  Bank holding company Truist Financial Corp. is in discussions to sell its insurance brokerage unit for approximately $10 billion to private equity firm Stone Point, who already has a minority stake. This potential deal reflects Truist looking to leverage the high value of its insurance asset to help navigate the difficult banking market.  Matic, an embedded insurtech platform, raised $20 million in an extension to its Series B round. This investment shows the growing demand for technology-driven insurance solutions and Matic’s impressive financial growth.  Another embedded value proposition surfaced with Allianz Partners and bolttech forming a strategic partnership to provide embedded device and appliance protection insurance across Asia Pacific and the United States  Partnerships continue to demonstrate the importance of expanding insurance offerings to customers.  Private equity capital continues to flow with the latest large capital fund announced by Warburg Pincus.  The oldest private equity firm has successfully closed its latest global flagship fund, totaling $17.3 billion. This sizable fund indicates the continuous interest of private equity in the insurance sector, suggesting significant investments and acquisitions may be on the horizon.

 [2]

Data Is Key Asset

Data continues to be the key asset in the insurance industry with several news items this week indicating this trend. The growing importance of data and analytics in insurance and insurtech’s role is reshaping the industry.  Amwins introduces Amwins DNA, a comprehensive portfolio of data and analytics capabilities. This move emphasizes the integral role of data and analytics in enhancing client services and underwriting excellence.  Vellum Insurance, an analytics and data management platform promising to help data movement throughout the value chain, emerged from stealth with $7 million in seed funding.  Shift Technology has solidified a relationship agreement with TransUnion, enabling insurers to use TransUnion’s data to inform Shift Claims Fraud Detection models. This collaboration exemplifies the industry’s reliance on data-driven insights for risk management and fraud detection.

 [3]

Strategic Moves, Focus on Profitability

It appears evident that insurers are working hard at becoming profitable in this hard market.  A survey reveals that insurers are prioritizing profit over growth, with 35 percent of C-suite executives highlighting macroeconomic challenges as a top trend impacting their companies.  AIG has made leadership promotions, including the creation of a new role, Chairman of General Insurance. This move underscores the importance of building distribution partner relationships and underwriting excellence in driving profitable growth.  Slide Insurance, a full-stack homeowners insurtech, has acquired renewal rights for 86,000 Florida homeowners insurance policies from Farmers Insurance. This move is part of the industry’s response to changes in the market, with Farmers no longer offering coverage in Florida, impacting policyholders. American Family Insurance has confirmed staff reductions across its five U.S. companies, including leadership level positions, as part of its efforts to increase efficiency and manage costs.  Progressive is showing progress with their financial results for September, ending the month with an 89.7% combined ratio, a 26.5 point decrease compared to September of last year. The insurer ended the month with a net income of $369 million and a total of 29.6 million policies, demonstrating a focus on financial performance and growth.

Join us as we continue to explore the headlines and news shaping the insurance sector, and stay tuned for more insights on the unfolding narrative of our industry!  Stay productive, stay safe and stay in touch!