Toa Re America sets path to become diversified all lines reinsurer

Toa Re America is actively recruiting as it looks to broaden its capabilities and portfolio of business to ultimately become a diversified all lines reinsurer, according to CEO Dick Sanford.

The executive was recruited late last year to succeed the retiring Ed Stanco and has already begun to add key personnel, including his former PartnerRe colleague Brian Sabia as executive vice president and CUO and Julie Halper from Swiss Re as executive vice president and chief actuary.

The reinsurer currently has a major concentration in excess casualty and umbrella business as well as agricultural reinsurance, and a smaller concentration in regional mutual multi-line reinsurance business as part of its circa $600mn portfolio.

In an interview with this publication, Sanford said it is critical for the North American subsidiary of the Japanese reinsurer to reposition in order to be relevant for its clients.

“As reinsurers we take the volatility out of our clients’ business, and if you’re going to do that successfully you have to have a well-diversified portfolio,” he commented.

“We have to reposition, so we’re not overweight any one sector and more broadly diversified in line with what’s available in the market for reinsurers to write,” the executive continued.

He added that without diversification, “volatility is going to find us”.

Sanford said the diversification strategy will take time to execute but has the benefit of market tailwinds.

The reinsurer will seek opportunities in risk classes “around the edge of the sector”, including insurtech and public to private initiatives to create new markets for reinsurers.

Talent war

But Toa Re America will also look to broaden out into more traditional lines such as liability, with plans to continue developing capabilities in directors and officers and errors and omissions, and will also consider areas like surety where it can identify the right underwriting talent.

Last year the reinsurer hired Keith Cartmell from Sirius, with the underwriting executive now building an E&S property reinsurance book at Toa Re.

“There are lots of classes that are very traditional where we’re not active today that with the right people and skill sets we will be,” said Sanford.

The executive said that 2021 has been about “developing execution capabilities” and identifying the right talent.

He added that the war for talent is being fought on the underwriting side of the reinsurance business as well as broking.

“We have the tools and the opportunity at Toa Re America. Do you want to sleepwalk through the rest of your career at one of the giant reinsurers or come here and have every day be exciting?” he said.