Tuesday, May 21, 2024

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MGAs, insurtechs, embedded players target of Boost Re proposition

The launch of Boost Re allows partner companies to reap the benefits of being full stack, without requiring them to be fully regulated, according to the company’s founder and CEO, Alex Maffeo.

Boost Insurance launched Boost Re in October as the latest piece in the company’s ‘insurance-as-a-service stack’.

“Working with us can provide them with the benefits of being full stack, without requiring them to become a fully regulated insurance company,” he told Captive Intelligence.

Maffeo said the insurance industry is heavily regulated, and building an insurance business from scratch is complex and requires a “significant investment of time and money”.

Maffeo said Boost is a six-year-old growth stage insurtech built for the sole purpose of making it more cost effective for companies to transact in the insurance industry.

“We always wanted to build back in the stack, and Boost Re is the milestone that we have been building towards,” he told Captive Intelligence.

“It is about having direct access to the capital to deploy reinsurance capacity for all of our programmes, and for our partners that sit in front of us and use our infrastructure.”

For managing general agents (MGAs), insurtechs, and embedded insurance customers, Boost Re’s captive-as-a-service solution offers the ability for partnered companies to build their own insurance operations.

For alternative risk capital providers, Boost Re offers a conduit to deploy reinsurance capacity across Boost insurance programmes through captive cells.

Boost Re has around 10 different reinsurer relationships, which take 100% of the quota share behind programmes that Boost supports as the administrator.

“If a client wants to provide their own capacity for their programme, rather than building a captive themselves from scratch, they can basically rent one of our cells,” he said.

Boost Re would then manage the captive on their behalf.

Maffeo said there are two main uses for the cells themselves.

“The first is to have direct access to capital,” he said. “Everybody knows about the ILS and alternative capital market strategy in the reinsurance world.

“If the client is any sort of asset manager or risk capital provider, they can deploy a dedicated cell through Boost to participate in the reinsurance alongside one of our trusted reinsurance partners that are on the treaties.”

The second use for the cells is for what Maffeo defined as full-stack embedded insurance programmes or captive-as-a-service.

“Companies that are on the distribution side, such as insurtechs, MGAs or embedded insurance partners, can participate in their own risk on the back end,” he said.

“For those programmes, both the distribution and capacity are provided by the same entity.”