Hyperion Insurance Head David Howden on U.S. Expansion by MGA DUAL

By | October 31, 2013

David Howden, the chief executive of the London-based Hyperion Insurance Group, founded the company in 1994, “as a business to take on wholesale products in the international market,” he explained in a telephone interview with the IJ.

Howden, however, had a somewhat different vision of the international market at the time, and as it has turned out a very far-sighted one. Instead of following a number of his UK contemporaries in establishing a presence in the U.S. – then as now the world’s biggest insurance market – he concentrated Hyperion’s efforts on Europe and Asia.

The strategy was so successful, that four years later Hyperion split into two groups – the original company concentrates on insurance intermediary business, mainly wholesale re/insurance brokerage, while the DUAL Group handles underwriting business as a Managing General Agent (MGA).

“DUAL writes business with a number of carriers in Asia and Europe,” Howden said, but at least until last week, “very little in the U.S.” That will change swiftly with the announcement that DUAL is acquiring PGI Commercial, a property/casualty program manager headquartered in Naples, Florida.

According to its website, DUAL focuses on “underwriting business critical risks,” and has “become a well-established and respected leading underwriter with annual gross written premiums of over £250 million [app. $400 million] and now employs over 200 people in offices across Europe, Asia Pacific and the Americas.”

Howden’s business model is more than seeking out areas, such as emerging markets, where he sees opportunities for growth. “We’re looking for people with an ‘entrepreneurial’ spirit,” he said. Both companies are dedicated to seeking out executives who think outside the box, and want to explore new ways of creating business.

That means taking risks, but it doesn’t mean losing money. We “cut our teeth to prove to our clients that underwriting profits can be achieved,” Howden said. This means finding and creating new markets, which offer the opportunities to expand both the MGA business and the brokerage side.

Although the U.S., as a mature market, doesn’t really fit that category, Howden is confident that the PGI acquisition will be a good fit with DUAL. “There’s growth potential in the U.S. for MGA’s,” Howden said. “Ultimately, with good clients, good products and good service, MGA’s can serve the specialty markets very well.”

DUAL is quite capable of offering those types of services that carriers expect from an MGA. Howden pointed out that it already has access to a number of those carriers and uses the latest electronic technology throughout its business.

I addition PGI is just the type of company that has shown the entrepreneurial spirit Howden values. “To enter a market you have to find the right person; it’s very important,” he said. “PGI has great products, and it’s a young company [founded in 2003].” By bringing in some of the innovative products, developed elsewhere, and acquiring the expertise of PGI’s management team, DUAL looks set for success in the U.S. market.

The effort will be led by Justin Tweedie, president of PGI, who will become CEO of DUAL’s operations in the Americas. In the announcement of the acquisition he commented: “Joining Hyperion and becoming a part of DUAL represents a major step in the development of PGI’s operations. We are now a part of one of the largest unaffiliated international underwriting agencies in the world, and this brings both resource and network benefits to our clients and employees. We were attracted by the ambition and sheer energy of Hyperion and believe that this new partnership will help fuel our growth.”

PGI has underwriting offices in California, Florida, Georgia, Maryland, New Jersey and New York, concentrating on specialty programs for both property and casualty on an admitted and also an E&S basis. The combined DUAL and PGI business projects premiums exceeding $600 million from a business with 24 offices in 12 countries, spanning five continents.

From the conversation with David Howden, one gets the distinct impression that Hyperion and DUAL aren’t going to be resting on their success. He definitely has plans for future expansion, as the companies will not only continue to develop new products, but will also be looking for appropriate acquisitions.

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