Kinsale Capital Group, Inc. · NYSE:KNSL
Kinsale Capital — Investor Day (October 2021)
81 slides from Kinsale Capital's investor day presentation, Oct 21, 2021
Slide 1: Investor Day
INVESTOR DAY 10.21.2021 CAPITAL GROUP
Slide 2: Claims
KINSALE CAPITAL GROUP Mark Beachy CLAIMS
Slide 3: Our Business
OUR BUSINESS Severity driven Complex multi-party litigation Litigious/liberal jurisdictions Multi-faceted coverage forms Aggressive plaintiff bar
Slide 4: The Four P's
THE FOUR P’S • Specialized training People • Deep expertise • Strategic staffing • Claim triage Processes • Data advantage • Resolution focused Payout • Data & analytics • Pay what we owe • Teamwork Principles • Responsiveness • Partnerships
Slide 5: Our People
OUR PEOPLE 45% of Average of 49 Liability 6 Former 14 Years Employees Examiners Paralegals Industry have JD Experience
Slide 6: Specialization by Lines
SPECIALIZATION BY LINES Casualty Professional Property Lines Lines Lines • Construction • Professional • Aspera – • General Liability Personal Casualty • Health Care • Inland Marine • Small Business • Allied Health • Commercial • Energy • Management Property • Environmental Liability (Primary & • Li
Slide 7: Payout
PAYOUT Limited reserve & settlement authority. Management Span of approval on control. coverage & payment Pay what we matters. owe. Nothing more, nothing less.
Slide 8: Payout: Shortening the Claim Cycle
PAYOUT: SHORTENING THE CLAIM CYCLE RESOLUTION FOCUSED Investigation/ Time to Claims Litigation Evaluation Resolve End to end • Fair & • Settlements, thinking – prompt dispositive understand settlement motions & & be • Disputed voluntary confident & denied dismissal about the claims • Trial coverage
Slide 9: Processes: Claims Triage
PROCESSES: CLAIMS TRIAGE DEEP EXPERTISE THROUGH SPECIALIZATION • Continuous & ongoing damage over Construction multiple policy periods Defect • Organized by states • High volume, lower severity property Right Touch damage claims • Speed & efficiency reduces claim cycle • In-house experts on coverage
Slide 10: Principles
PRINCIPLES Teamwork Unparallel Timeliness Partnerships Responsiveness Reward the Doers
Slide 11: Information Technology
Diane Schnupp INFORMATION TECHNOLOGY
Slide 12: Kinsale Core Competency
KINSALE CORE COMPETENCY Technology is a core competency for: Efficiency Accuracy Service Data Technology is a core competency for efficiency, accuracy, service, and data
Slide 13: IT Strategy
IT STRATEGY Develop our core systems as a value-added business differentiator Hire and retain top talent Enable smart company growth
Slide 14: Innovation Accelerated
INNOVATION ACCELERATED Emergent Intentional Design Architecture • Quickly evolving Reconcile • Purposeful, planned architecture guidelines • Self-organized team • High level • Incremental approach • Cross team alignment • Foundational enablers Source: SAFe | Scaled Agile Framework
Slide 15: Underwriting Opportunities
UNDERWRITING OPPORTUNITIES Price the Broker Bind & Receive a Triage & risk & input & issue submission assess risk quote approval policy Increase & Auto- Workflow Automate Populate 3rd Automation Channels Party Data
Slide 16: Claims Opportunities
CLAIMS OPPORTUNITIES Investigate Decision Manage & Receive Triage Claim & Claim & Resolve Loss Notice Claim Notify Coverage Claim Claimant Auto- Workflow Letter Populate 3rd Automation Templates Party Data
Slide 17: Target State Approach
TARGET STATE APPROACH Corporate EA Strategic Business Enterprise Technology Business & Business Domains & Architecture Ecosystem IT Strategies Imperatives Architecture
Slide 18: Underwriting
UNDERWRITING Brian Haney A KIN SALE NSURANCE
Slide 19: Underwriting
UNDERWRITING Underwriting Casualty Specialty Professional Property Aspera Operations Casualty Lines Life Environmental Sciences
Slide 20: State of the Market
STATE OF THE MARKET Photo Credit: Baskervill
Slide 21: Our Approach
OUR APPROACH 100% Excess & Subject Matter Surplus Lines Experts Small-to-Medium Significant Expense Sized Risks Ratio Advantage Individual Risk Superior Systems Underwriting & Data
Slide 22: How We Are Different
HOW WE ARE DIFFERENT Rewarding No Delegated One Contrarian Tailored the Doers Underwriting Location, Underwriting Coverage in Person
Slide 23: Areas of Focus
AREAS OF FOCUS Customer Service Training & Product Development Development Using Technology to Boost Productivity
Slide 24: Casualty
CASUALTY Stuart Winston A, KINSALE “me CAPITAL GROUP
Slide 25: Casualty
CASUALTY 2020 YEAR-END CASUALTY GROSS YEAR-END GROSS WRITTEN PREMIUM WRITTEN PREMIUM BY DIVISION $600,000,000 $500,000,000 Excess Casualty Construction 28% 31% $400,000,000 $300,000,000 General $200,000,000 Casualty 10% Small $100,000,000 Business 31% $0 2018 2019 2020 Kinsale Casualty
Slide 26: Construction
CONSTRUCTION YEAR-END GROSS WRITTEN PREMIUM $100,000,000 $87.2M $90,000,000 GWP $80,000,000 $71.0M $70,000,000 GWP $60,000,000 $50.9M $50,000,000 GWP $40,000,000 $30,000,000 $20,000,000 $10,000,000 $0 2018 2019 2020
Slide 27: Construction: Top Classes
CONSTRUCTION TOP CLASSES Residential & Commercial Subcontractors Roofing Contractors Carpentry Contractors Fire Protection Services Painting Contractors
Slide 28: General Casualty
GENERAL CASUALTY YEAR-END GROSS WRITTEN PREMIUM $35,000,000 $29.2M $30,000,000 GWP $25,000,000 $23.3M GWP $20,000,000 $17.6M GWP $15,000,000 $10,000,000 $5,000,000 $0 2018 2019 2020
Slide 29: General Casualty: Top Classes
GENERAL CASUALTY TOP CLASSES Condominiums/Townhome Associations Apartments Security Agencies Amusement Parks Mobile Home Parks
Slide 30: Small Business
SMALL BUSINESS YEAR-END GROSS WRITTEN PREMIUM $83.3M $90,000,000 GWP $80,000,000 $63.2M $70,000,000 GWP $60,000,000 $50,000,000 $44.4M GWP $40,000,000 $30,000,000 $20,000,000 $10,000,000 $0 2018 2019 2020
Slide 31: Small Business: Construction Top Classes
SMALL BUSINESS CONSTRUCTION TOP CLASSES Subcontractors Carpentry Contractors Roofing Contractors Plumbing Contractors Stucco/Plastering Contractors
Slide 32: Small Business: General Casualty Top Classes
SMALL BUSINESS GENERAL CASUALTY TOP CLASSES Real Estate Development Property Commercial Properties (Lessors Risk Only) Apartments Warehouses/Office Buildings Truckers General Liability
Slide 33: Excess Casualty
EXCESS CASUALTY YEAR-END GROSS WRITTEN PREMIUM $90,000,000 $76.7M $80,000,000 GWP $70,000,000 $60,000,000 $51.2M $50,000,000 GWP $37.4M $40,000,000 GWP $30,000,000 $20,000,000 $10,000,000 $0 2018 2019 2020
Slide 34: Excess Casualty: Top Classes
EXCESS CASUALTY TOP CLASSES Apartments Subcontractors Roofing Contractors Emerging Products Security Guards
Slide 35: Casualty: Market Opportunities
CASUALTY MARKET OPPORTUNITIES CONSTRUCTION GENERAL CASUALTY SMALL BUSINESS EXCESS CASUALTY DIVISION DIVISION DIVISION DIVISION • Tightening in • Non-renewals or • Carriers are • Capacity residential sizable rate increases pulling out of being cut by construction from many of our certain states. comp
Slide 36: Innovation
INNOVATION DRIVING CULTURE, GROWTH, AND PROFITABILITY New New 3rd Party Products Processes Data
Slide 37: Property
PROPERTY Ashlee Randall, CPCU, ASLI, AU, AIS
Slide 38: What Makes Up Property?
WHAT MAKES UP PROPERTY? Commercial Small Inland Property Property Marine WHAT MAKES KINSALE’S PROPERTY SEGMENT DIFFERENT?
Slide 39: Market Trends
MARKET TRENDS UNDERSTANDING THE PROPERTY MARKET CAPACITY • Capacity is being restricted, deductibles increased, and coverage reduced • Capital is still robust • Increasing reinsurance costs VALUES • Undervalued buildings • Shortage of building materials and labor • Inflation
Slide 40: Market Trends
MARKET TRENDS UNDERSTANDING THE PROPERTY MARKET PERILS/CATASTROPHE • CAT exposed properties are seeing double digit renewal increases. • Unexpected perils: • Wildfire • Riots • Freezing • Reaction to large area specific events: • Southeast windstorms • Florida condo collapse
Slide 41: Managing Trends
MANAGING TRENDS Leverage data • Modeling • Peril tracking Understand your exposure • Pictures • Valuations Aggregate management • Managing locations • Diversification Focus on where we excel • Small • Tough to place • Individual account underwriting • Technology
Slide 42: Commercial Property
COMMERCIAL PROPERTY YEAR-END GROSS WRITTEN PREMIUM $60,000,000 $51.8M GWP $50,000,000 $40,000,000 $29.1M $30,000,000 GWP $20,000,000 $9.2M $10,000,000 GWP $0 2018 2019 2020
Slide 43: Commercial Property: Offerings
COMMERCIAL PROPERTY OFFERINGS Ground up Primary Excess
Slide 44: Commercial Property
COMMERCIAL PROPERTY Everyone offers these coverages, how do we stand apart?
Slide 45: Commercial Property: Broad Appetite
COMMERCIAL PROPERTY BROAD APPETITE HABITATIONAL INDUSTRIAL WOOD PRODUCTS RETAIL & REAL ESTATE GOVERNMENT FOOD/ANIMAL WAREHOUSING SERVICES PROCESSING
Slide 46: Commercial Property: Mix & Match Coverages
COMMERCIAL PROPERTY MIX & MATCH COVERAGES FIRE WINDSTORM EARTHQUAKE/ FLOOD (ALL OTHER PERILS) EARTH MOVEMENT
Slide 47: Commercial Property: Targeting the Customer Market
COMMERCIAL PROPERTY Targeting the Customer Market Technology Tough Accounts Service Opportunity
Slide 48: Small Property
SMALL PROPERTY MISSING PIECE QUICK TURN PREVIOUS AROUND EXPERIENCE Quoting the property piece We’re able to Focusing on alongside our provide brokers small accounts small account the fast service where Kinsale focused casualty they’ve become excels units. accustomed to from Kinsale.
Slide 49: Small Property: Appetite
SMALL PROPERTY APPETITE Even on the small accounts we are still targeting the tough to place risks! • Up to $2.5M Total Insured Value • Ground-up Light Vacant Retail Healthcare Manufacturing Buildings Facilities
Slide 50: Inland Marine
INLAND MARINE YEAR-END GROSS WRITTEN PREMIUM $8,000,000 $6.9M $7,000,000 GWP $6,000,000 $5,000,000 $4,000,000 $3.5M GWP $3,000,000 $2.0M $2,000,000 GWP $1,000,000 $0 2018 2019 2020
Slide 51: Inland Marine: Top Classes
INLAND MARINE TOP CLASSES Motor Truck Builder’s Risk Contractors Cargo Equipment
Slide 52: Inland Marine: The Difference
INLAND MARINE THE DIFFERENCE • Our most diversified division with multiple lines of coverage available. • Fast response time – fast quotes, fast responses. • Crafting coverage to each insured. • Not afraid of accounts with losses or in tough jurisdictions.
Slide 53: Kinsale Property: The Difference
KINSALE PROPERTY THE DIFFERENCE Small Customer Tough Technology Accounts Service Risks
Slide 54: Specialty Casualty
SPECIALTY CASUALTY Brendan McMorrow
Slide 55: Specialty Casualty: Divisions
SPECIALTY CASUALTY DIVISIONS Energy Life Sciences Environmental Products Liability
Slide 56: Specialty Casualty
SPECIALTY CASUALTY YEAR-END GROSS WRITTEN PREMIUM $94.9M $100,000,000 GWP $90,000,000 $80,000,000 $70,000,000 $64.7M GWP $60,000,000 $52.3M GWP $50,000,000 $40,000,000 $30,000,000 $20,000,000 $10,000,000 $0 2018 2019 2020
Slide 57: Products Liability Division
PRODUCTS LIABILITY DIVISION IMPORTERS, DISTRIBUTORS, MANUFACTURERS OF CONSUMER & INDUSTRIAL PRODUCTS Recreational & Consumer Electronics Sporting Goods Machinery & Emerging Products Equipment Firearms
Slide 58: Products Liability Division
PRODUCTS LIABILITY DIVISION YEAR-END GROSS WRITTEN PREMIUM $45,000,000 $38.3M $40,000,000 GWP $35,000,000 $30,000,000 $26.3M GWP $25,000,000 $20.0M $20,000,000 GWP $15,000,000 $10,000,000 $5,000,000 $0 2018 2019 2020
Slide 59: Life Sciences Division
LIFE SCIENCES DIVISION MEDICAL PRODUCT MANUFACTURERS, DISTRIBUTORS, WHOLESALERS Dietary Supplements Biologics Durable Medical Pharmaceuticals Equipment & Devices Health & Beauty Products
Slide 60: Life Sciences Division
LIFE SCIENCES DIVISION YEAR-END GROSS WRITTEN PREMIUM $35,000,000 $31.0M GWP $30,000,000 $25,000,000 $20,000,000 $17.8M GWP $15,000,000 $14.5M GWP $10,000,000 $5,000,000 $0 2018 2019 2020
Slide 61: Energy Division
ENERGY DIVISION OIL & GAS, RENEWABLE ENERGY, MINING & POWER Oil & Gas Service Power Distribution Contractors Energy Exploration & Manufacturers Production Pipeline Owners & Operators
Slide 62: Energy Division
ENERGY DIVISION YEAR-END GROSS WRITTEN PREMIUM PRIMARY COVERAGE ONLY $18,000,000 $17.0M GWP $15.6M $16,000,000 GWP $15.4M GWP $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $0 2018 2019 2020
Slide 63: Environmental Division
ENVIRONMENTAL DIVISION OPERATIONS OR PRODUCTS THAT MAY IMPACT THE ENVIRONMENT Waterproofing Mold Remediation Contractors Lead/Asbestos Disaster Response Abatements Contractors
Slide 64: Environmental Division
ENVIRONMENTAL DIVISION YEAR-END GROSS WRITTEN PREMIUM $8.6M $9,000,000 GWP $8,000,000 $7,000,000 $6,000,000 $5.2M GWP $5,000,000 $4,000,000 $3,000,000 $2.2M GWP $2,000,000 $1,000,000 $0 2018 2019 2020
Slide 65: Specialty Casualty: State of the Market & Opportunities
SPECIALTY CASUALTY STATE OF THE MARKET & OPPORTUNITIES • Small accounts • Programs closing • Excess capacity reductions PRODUCTS LIFE SCIENCES ENVIRONMENTAL ENERGY DIVISION DIVISION DIVISION DIVISION • Emerging • Virus test kits • Disinfectant • Renewable products • Personal contractors energy • Fir
Slide 66: Professional Lines
PROFESSIONAL LINES Pat Dalton
Slide 67: Professional Lines: Divisions
PROFESSIONAL LINES DIVISIONS Allied Health Professional Management Public Health Care Liability Liability Entity
Slide 68: Professional Lines: 2020 GWP by Division
PROFESSIONAL LINES 2020 YEAR-END PROFESSIONAL LINES GROSS WRITTEN PREMIUM BY DIVISION Professional Liability 27% Allied Health 38% Public Entity 3% Management Health Liability Care 24% 8%
Slide 69: Professional Lines
PROFESSIONAL LINES YEAR-END GROSS WRITTEN PREMIUM $120,000,000 $99.3M GWP $100,000,000 $80,000,000 $65.4M GWP $60,000,000 $48.6M GWP $40,000,000 $20,000,000 $0 2018 2019 2020
Slide 70: Allied Health: Team, Coverages & Appetite
ALLIED HEALTH TEAM, COVERAGES & APPETITE • 14 member Residential Care Facilities team • General Liability & Professional Liability Outpatient Medical Facilities Social Service Agencies
Slide 71: Allied Health
ALLIED HEALTH YEAR-END GROSS WRITTEN PREMIUM $37.6M $40,000,000 GWP $35,000,000 $30,000,000 $24.0M $25,000,000 GWP $20,000,000 $16.8M GWP $15,000,000 $10,000,000 $5,000,000 $0 2018 2019 2020
Slide 72: Health Care: Team, Coverages & Appetite
HEALTH CARE TEAM, COVERAGES & APPETITE • 6 member team Dentists • Professional Liability for Medical Mid-Level Providers Malpractice exposures Physicians & Surgeons Group Practitioners
Slide 73: Health Care
HEALTH CARE YEAR-END GROSS WRITTEN PREMIUM $9,000,000 $7.7M $8,000,000 GWP $7,000,000 $6.0M $5.7M GWP $6,000,000 GWP $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 2018 2019 2020
Slide 74: Professional Liability: Team, Coverages & Appetite
PROFESSIONAL LIABILITY TEAM, COVERAGES & APPETITE • 10 member team Lawyers • Errors & Omissions coverage for non- medical professionals Architects & Engineers Insurance Agents Accountants
Slide 75: Professional Liability
PROFESSIONAL LIABILTIY YEAR-END GROSS WRITTEN PREMIUM $30,000,000 $27.0M GWP $25,000,000 $20.0M $20,000,000 GWP $16.7M GWP $15,000,000 $10,000,000 $5,000,000 $0 2018 2019 2020
Slide 76: Management Liability: Team, Coverages & Appetite
MANAGEMENT LIABILITY TEAM, COVERAGES & APPETITE • 7 member team Construction Firms • Employment Practices Liability (EPL) • Directors & Officers Bars, Taverns & – private & Restaurants nonprofit (D&O) • Educators Legal Manufacturing Operations Liability Law Firms
Slide 77: Management Liability
MANAGEMENT LIABILITY YEAR-END GROSS WRITTEN PREMIUM $30,000,000 $24.1M $25,000,000 GWP $20,000,000 $14.8M $15,000,000 GWP $10,000,000 $8.2M GWP $5,000,000 $0 2018 2019 2020
Slide 78: Public Entity: Team, Coverages & Appetite
PUBLIC ENTITY TEAM, COVERAGES & APPETITE Police Departments • 2 member team • Public Officials with Employment Public Schools Practices Liability • Educator’s Legal Liability Colleges & Universities • Law Enforcement Liability Governing Authorities
Slide 79: Public Entity
PUBLIC ENTITY YEAR-END GROSS WRITTEN PREMIUM $3,500,000 $3.0M GWP $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1.2M GWP $1,000,000 $0.6M GWP $500,000 $0 2018 2019 2020
Slide 80: Professional Lines: State of the Market & Opportunities
PROFESSIONAL LINES STATE OF THE MARKET & OPPORTUNITIES ALLIED HEALTH HEALTH CARE PROFESSIONAL MANAGEMENT PUBLIC ENTITY • Aging society • Competitors LIABILITY LIABILITY • Reduced • We are NOW are pulling • Market • Hardening capacity in the game back capacity Market • Target • Taking more • Firming
Slide 81: Investor Day
INVESTOR DAY 10.21.2021 CAPITAL GROUP