Arch acquiring tech & third-party capital focused MGU Ventus


Arch Insurance North America, a division of insurance and reinsurance specialist Arch Capital Group, has announced that it will acquire the technology and third-party capital focused managing general underwriter Ventus Risk Management.

arch-ventus-riskRegular readers will be familiar with Ventus Risk Management, a company focused on sourcing and underwriting property catastrophe and broader coastal property risks for a diverse range of capital providers, including insurance-linked securities (ILS) investors, and using advanced technology to deliver improved portfolio management and more efficient transfer of its risks.

Ventus was launched in 2016 by co-founders Stuart Mercer (President) and George Reeth (CEO), with a goal to leverage proprietary technology to improve automation, efficiency and risk selection for both sides of the risk transfer transaction.

A technology and analytics-driven MGU, Ventus developed a specialism in offering coastal commercial property insurance solutions to small and mid-sized enterprises, backed by diverse capital including third-party reinsurance investors.

Arch will acquire Ventus to put its technology-driven MGU systems to work alongside its own, explaining that, “integrating Ventus into the Arch platform will enable third-party capital to provide capacity alongside Arch’s product offerings.”

“Ventus is an insurtech company that has successfully deployed its offerings to support its underwriters, deliver best-in-class analytics and modeling capabilities and provide a superior customer experience,” Matt Shulman, CEO of Arch Insurance North America explained on the deal. “When combined with the scale of our E&S property portfolio and breadth of our relationships, we will bring enhanced value to our wholesale distribution partners.”

The founders of Ventus explained that they see the transaction as good for its employees, brokers, customers and carrier partners.

George Reeth, Ventus co-founder, has announced his retirement alongside this announcement on the sale of the company.

Reeth commented, “I’m incredibly proud of what we’ve built at Ventus. By joining the Arch family, our employees will have access to a depth of resources that will allow them to continue to bring robust, creative solutions to the market and develop professionally.”

Co-founder Stuart Mercer, will now move into the CEO role at Ventus upon the close of the sale to Arch.

Mercer added, “Arch is known for innovative structures that allow third-party capital to access insurance and reinsurance risks behind its strong underwriting expertise. The combined platform will bring broader capabilities and expanded capacity to Arch’s E&S property unit. I’m excited to continue to bring technology driven solutions to the marketplace when our producers and customers need it the most.”

Ventus has more than 30 employees and offices located in Atlanta, GA, Columbia, SC, Houston, TX and Richmond.

The company had always focused on adding efficiency to the market chain, connecting catastrophe exposed property risks more closely to third-party reinsurance capital and the capital markets using its technology solutions.

Ventus uses 3rd party data sources, artificial intelligence (AI), natural language processing and cloud-based technology to facilitate data organisation and provide sophisticated underwriting tools, enabling it to select and price catastrophe-exposed U.S. commercial risks more efficiently.

Using those advanced technologies, Ventus enables a risk takers’ portfolio to be known and made available in real time, allowing re/insurance capital providers to price risk formulaically and better monitor aggregations and concentration, with real-time portfolio optimisation seen as one way to improve costs and efficiencies.

Ventus seems a good fit with Arch, given Arch Capital has already demonstrated its appetite to put technology to work in delivering more efficient risk transfer solutions and pipelines.

We explained before how Arch was seeking to make a better pipeline for risk and risk related data in the mortgage risk transfer market, to enable the transfer of the risk smoothly and efficiently to partners, ultimately to lower the cost of risk-capital.

Integrating Ventus into its own property insurance offerings can achieve similar, providing Arch with an edge that should help the company grow and become more competitive, while also enabling it to leverage third-party reinsurance capital alongside its own capacity in an efficient manner.

The future is more efficient and effective acquisition of risk and its transfer to capital, using sophisticated data, analytics and portfolio technologies.

Ventus provides much of that to Arch and will help to propel its strategy for cat exposed property insurance forwards as a result.

Artemis Live - ILS and reinsurance video interviews and podcastView all of our Artemis Live video interviews and subscribe to our podcast.

All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance video content and video interviews can be accessed online.

Our Artemis Live podcast can be subscribed to using the typical podcast services providers, including Apple, Google, Spotify and more.

Print Friendly, PDF & Email

Artemis Newsletters and Email Alerts

Receive a regular weekly email newsletter update containing all the top news stories, deals and event information

  • This field is for validation purposes and should be left unchanged.

Receive alert notifications by email for every article from Artemis as it gets published.