February 7, 2022
Crum & Forster celebrates 200 years this year. The company’s Tom Bredahl shares some of his thoughts on the business.
Source: Risk & Insurance Magazine
In mid-December, Dan Reynolds, the editor-in-chief of Risk & Insurance®, caught up with Tom Bredahl, CPCU, ARe, and the president and chief underwriting officer of Surplus & Specialty Lines for Crum & Forster, which is coming up on its 200th anniversary. What follows is a transcript of that conversation, edited for length and clarity.
Risk & Insurance: For starters, if you wouldn’t mind jumping in and describing your background with the company and your overall area of responsibility.
Tom Bredahl: My title is president and chief underwriting officer of C&F’s Surplus & Specialty Lines Division.
My responsibilities include setting policy guidelines, authorities, underwriting appetites and protocols. But we also have a full stack of support capabilities. The way we’re set up, it’s decentralized. We have a dedicated claims team, dedicated actuaries, our own HR division and our own digital capabilities – all within the Surplus & Specialty Lines Division.
All of those functional areas roll up to me and we run the division like a full-service insurance company. In fact, we’re targeting a billion dollars in writings for our Surplus & Specialty Group in 2022, virtually all specialty premium. It’s an exciting place to be.
R&I: We’re here on the back end of 2021, Tom, and thinking about 2022, are there growth or product areas that you’re pretty excited about or you find interesting?
TB: There are so many. It’s a great time to be a specialty insurer. There are a lot of fundamentals that are aligned, so many parts of the rising tide that are favorably affecting us all.
We keep four industry verticals. They are construction, environmental, security, and energy. The fundamentals in those, despite limits compression, despite competition from new upstarts, are just super robust.
We feel that with these groups, we’re in the right place at the right time. Having put in so much fundamental work over the past few years, we did a lot of our re-underwriting when times were leaner. And now that the light is shining on us, we feel we’re ready at the right moment.
Elsewhere, in our group, we have specialty divisions that service the gig economy. We have a big trucking group. We have all manner of specialty outlets for binding authority and small businesses. We have a large block of excess casualty business that is experiencing great gains.
We’re a big fan of pushing distribution concepts onto brokers and integrating with brokers. It’s the full stack that’s exciting. And that’s just on the underwriting side.
R&I: Could you tell us more about that security business?
TB: It serves the security guard industry, both armed and unarmed. We do all manner of venues, big and small. It’s a specialty that came to us from C&F’s acquisition of First Mercury Financial Corporation and its subsidiaries in 2011.
R&I: Just to dig into another industry a bit. With the trucking industry, we’ve heard a lot about removal of capacity, carriers getting away from that some. Can you give us your perspective on what’s going on there and your underwriting approach too, if you wouldn’t mind?
TB: Trucking is exciting to us because of the analytics we deploy in evaluating it. Everything that we do in terms of pushing the envelope, in terms of modeling and procuring information, understanding telematics, trying to develop correlations between risk traits and outcomes we want, or outcomes we don’t want; that really comes to bear first and foremost in trucking because there’s so much information available.
The DOT, the FTA, they all have tremendous amounts of information publicly available that we can pour into our models and utilize how we see fit. We started a data science team long before it was in vogue, and they’ve been wrestling with this kind of information for a long time now. And we think we’re getting pretty good at it.
That’s the upside. There are headwinds right now, just given supply chain difficulties, the shortage of drivers, and the amount of product that has to move during these lean times.
Nothing’s ever completely perfect, but we’re having good success with selection and pricing. And our distribution partners are feeding us a steady diet of meaningful and good risks.
Trends are good. I know that it’s a stigmatized line or a polarized line. It has its dissenters, but we’re pretty deep into it.
We’re mostly small-fleet oriented. I think that makes a difference. We don’t have a tremendously large segment in larger primary fleet business. We pick up a lot of one-unit and two-unit risks – and we can do because our operations team executes so well.
Read the entire article on Risk & Insurance’s website.