Davies’ captive management arm grows US presence and eyes European expansion

3rd August 2020

This article was first published by Insurance Post

Davies Group is scoping out expanding its captive management presence to Guernsey or Malta, after expanding its US capabilities with the acquisition of Citadel Risk’s captive management business last week. Citadel Management & Cedar Consulting, which is led by a management team spread across Bermuda and Ohio, will be rebranded and trade as part of Bermuda-based Davies Captive Management, which sits within Davies’ Insurance Services practice.

“We were firmly established in the US in Vermont, but now we’ve got an extra office in Ohio,” said Steven Crabb, CEO of Davies Insurance Services. “Both of those combined businesses have licensed capability across the US. It’s a scale up, but that scale also gives us much better capability to deal with more new clients in future.” The acquisition is Davies’ third of this year, following the purchase of UK law firm Keoghs in January and automation specialists Codebase8 in June.

Crabb said that the group would continue to focus on growing in the US this year, in particular building out its claims third-party administration business.

He also highlighted gaining access to new jurisdictions as a guiding principle for the group’s growth strategy. “We are looking to increase our jurisdictional capability and we are currently thinking about how we develop Davies’ captive management capability in Guernsey or Malta to be able to be able to respond to our UK and European customers,” he said.

Crabb said that ripple effects from the coronavirus pandemic with regard to insurance capacity and pricing had spurred renewed interest in captives as a risk solution.
“In the last week, we’ve had four new inquiries to set up captives from people in the US, and this has absolutely been stimulated by the economic change,” he said.

“In some lines of business in the professional lines and liability space, particularly in the US, the amount of insurance companies which are offering to sell policies is now reduced and for the ones that are left, the prices are high. “Customers who buy that insurance are now having to look at a blended solution where they can use a captive to help them manage those capacity changes and price fluctuations.”

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