Pen Underwriting, a multi-territory managing general agent (MGA), has consolidated 15 UK household and SME portfolios into a five-year, £550 million, single quota share arrangement led by Legal & General.
The creation of a single ‘master’ binder for Pen’s UK household and SME business will benefit both its customers and distribution partners through improved trading efficiencies and enhanced product offerings, as well as providing security on a long-term basis.
Pen’s cornerstone placement with Legal & General is expected to provide capacity for £110 million of annual gross written premium.
The move is also part of Pen’s strategic development to become a virtual insurer, meaning it would be able to fulfil all the typical functions of an insurance company, such as sales, distribution, pricing, claims, and analytics, but would not carry any risk.
Jonathan Turner, Chief Executive Officer (CEO) of Pen Underwriting, said: “Launching this cornerstone placement for Pen’s UK household and SME business is a key milestone in our evolution as a virtual insurer. We’re delighted to have secured this meaningful, long-term capital commitment led by Legal & General, one of the UK’s most trusted brands.
“It is a strong endorsement of our model following significant investment in people, infrastructure and governance; and marks the culmination of nearly two years of work to simplify our capacity structure and enhance the Pen proposition to deliver sustainability and security to our customers and distribution channels. Indeed, it places Pen on a far stronger platform and will allow us to drive profitable growth, both organically and through further acquisitions.”
Cheryl Agius, CEO of General Insurance for Legal & General, added: “Legal & General is delighted to deepen our strong partnership with Pen as it continues to evolve its business and become the leading virtual insurer in the MGA sector.
“The alignment of Legal & General’s capacity alongside the expertise of Pen provides us with the perfect fit as we look to expand our thinking and help to deliver great products and services to Pen’s customers.
“We are firmly committed to the partnerships sector and the extension of the relationship with Pen supports Legal & General’s strategy to work with the right partners to bring innovative and exciting insurance solutions to market.”