Blockchain and AI-driven MGA AllDigital Specialty will deliver its management liability offering through digital insurance platform Appulate in a three-pronged strategy to expand its distribution network as it also looks to broaden its product suite to include excess coverage in 2022, The Insurer can reveal.

AllDigital and Appulate

Appulate and AllDigital today unveiled the partnership, which they said will allow brokers to generate real-time quotes and bind policies quickly and efficiently.

Brokers will use an Appulate technology-powered API connection to access AllDigital Specialty’s private permissioned blockchain platform.

In a statement the firms said the technologies disrupt the traditional insurance model by making it cost effective for all parties to provide insurance for the “vastly underserved” small business commercial market.

Appulate president Jeff Harris said the digital network expansion will allow AllDigital Specialty to reach the platform’s 35,000 retail member firms and 250,000 individual brokers.

As previously reported, AllDigital Specialty’s core management liability offering includes D&O and employment practices liability coverage, which can be purchased together or separately and is written on Axis Insurance paper.

It has also added fiduciary coverage to the offering and is expected to launch an excess capability to sit on top of its primary policies in the first half of this year.

AllDigital Specialty CEO Athula Alwis

Picture credit: Vikrant Tunious

Athula Alwis-founded and led AllDigital Specialty began underwriting last year and uses blockchain technology for transactions while it also utilises a proprietary AI system that it says allows it to underwrite insurance products profitably for its wholesale broker partners.

The partnership with Appulate – and other potential tie-ups with digital marketplaces – is one part of a strategy being executed by the start-up to expand its distribution network.

The MGA is also working to provide its existing wholesale brokers – including RT Specialty, Amwins, CRC, Brown & Brown, ARC Excess & Surplus, Risk Placement Services and Socius – a way to connect with their key retail brokers through a digital link.

And it is looking to connect with digital wholesalers in the market in a move which will heighten the advantages of its own frictionless platform. AllDigital Specialty will provide platform access or an API connection to select digital wholesalers.

Digital network expansion

In an interview with this publication, Alwis stated that the network expansion has always been part of the plan.

“We’re fully committed to our original plan of limited wholesale distribution,” he said, adding that the MGA does not expect to allow more than 20 points of access through its blockchain platform.

“We are still going the traditional route of MGA to wholesaler to retailer to the customer, consistent with the plan I outlined to all our wholesale partners in September 2021 at our first annual broker meeting held outdoors in Bedminster, New Jersey. It is simply a frictionless digital journey to provide decision making at scale,” the former QBE North America executive stated.

The digital distribution strategy is expected to be a meaningful generator of growth in 2022 and beyond.

Alwis said AllDigital Specialty could see as much as 50 percent of its business coming from digital wholesalers and via digital marketplaces this year, with the remainder based on organic growth from its existing wholesale relationships and its planned launch into excess management liability.

As previously reported, AllDigital Specialty is using machine learning based techniques to develop underwriting tools and analytics to drive better risk selection and pricing as it pursues lower loss costs.

It aims to rapidly speed up the process of underwriting, quoting and binding business, lowering the cost for insurers and brokers to engage with small accounts and transact business.