Kinsale – the story of the insurance company that found gold where others see only risk?
Kinsale is an insurance company – but it's not 'just another insurance company'.
It operates in the E&S (Excess & Surplus) market — a field where most major players avoid treading.
This is a market of about $115 billion in the US, focusing on insurance for rare, complex, or "unpriceable" risks – those areas that regular insurance companies simply forgo.
Kinsale's advantage – flexibility, speed, and profitability
E&S companies enjoy regulatory flexibility – they can set free rates and terms, which allows them to compensate for high risk with high profitability.
Kinsale, for example, demands high premiums and excludes many situations from coverage – thus maintaining an exceptionally low loss ratio, even if this comes at the expense of a low customer retention rate.
Market overview Kinsale operates in a market saturated with over 75 competitors, including Berkshire Hathaway, AIG, Chubb, and Lloyd's of London, but most of them work with outdated systems.
Despite a relatively small market share – less than 2% – Kinsale has grown quite rapidly thanks to a technological system it built itself and the expansion of its permanent workforce.
While other insurance companies are currently struggling in a "hard" market that is becoming competitive again, Kinsale has so far managed to maintain a balance between growth and profitability thanks to its unique structure.
Management – the heart of the engine
The company is headed by Michael Kehoe – the founder and CEO, who holds about 4% of the shares, alongside Bryan Heini (COO).
Heini holds shares worth 116 times his annual salary – interesting.
Bonuses and compensation at Kinsale are based on qualitative metrics – combined ratio, underwriting profitability, and return on equity (ROE) – and not just on growth. Employees are also rewarded for profitability rather than activity volume, and many of them hold company shares themselves.
What is Kinsale's differentiation?
Sharp focus – the company focuses solely on the E&S market in the US, without international diversification.
Unique technological system – developed over 7 years in-house, while other companies rely on dozens of old systems.
Full integration – Kinsale handles the entire value chain – from underwriting to claims – in-house. There is no outsourcing, which provides high operational efficiency, low costs, and the ability to provide fast and accurate quotes.
Numbers that tell a story Last year, Kinsale received 881,000 applications for new policies and approved only 64,000 policies – exceptionally high selectivity.
All of this is done with fewer than 660 employees – an interesting fact.
In short – Kinsale is one of those rare companies that have managed to find profit where others see only chaos.
With focused management, an advanced technological structure, and a creative strategy – Kinsale appears to be carving out a rather interesting place for itself at the top of the specialty insurance market.
If we try to summarize Kinsale's business model -
Take a calculated risk, understand it better than anyone else, and price it correctly.