After launching Juniper Re, its reinsurance broking platform in mid-October, BRP Group believes the payback from the investment will be fairly short, with a view to having the business EPS accretive and cash flow positive in 2025, according to Chief Executive Officer (CEO), Trevor Baldwin.
Independent insurance distribution company, BRP Group, said when launching its new reinsurance operation that it was a natural complement to its retail brokerage business.
Juniper Re will be led by former BMS Re Chief Property Officer, Jeff Irvan, who brings more than 25 years of reinsurance broking experience to the firm.
Speaking recently during BRP Group’s Q3 2023 earnings call, CEO Baldwin commented on the launch.
“Reinsurance brokerage is a capability we have long had on our strategic road map because of its superior financial returns and integral position in the insurance ecosystem, and we jumped at the opportunity to launch this with a seasoned leader and team,” said Baldwin.
The company expects that Juniper Re will begin contributing to revenue as early as the first quarter of next year.
Baldwin explained that while BRP believes that Juniper Re will be a negative EBITDA business in 2024, “we have line of sight to it being EPS accretive and cash flow positive in 2025.”
“That’s roughly how we’re thinking about it, which is a very rapid payback period for an endeavour of this nature,” said Baldwin.
BRP says that the appointment of Irvan and a world class team with experience, as well as its existing relationships it will be able to take advantage of, are key to the quick payback period.
The CEO stressed that there’s “an immense amount of strategic value” in BRP having the reinsurance capability within its retail broking and MGA capabilities.
In terms of focus, Baldwin said that initially, Juniper Re will be focused more on specialty treaty business, an area where it has deep expertise around property cat programs.
“But we envision kind of the strategic expansion of broad capabilities and specialization to serve all major segments in this market over time,” said Baldwin.