Hippo & Greenlight Re form partnership for MGA programmes

Hippo has formed a strategic partnership with Greenlight Re, linking investment in early-stage insurance programmes with carrier and reinsurance support.

Under the arrangement, Hippo can invest alongside Greenlight Re in emerging managing general agents, while Hippo subsidiary Spinnaker will serve as the preferred US admitted fronting carrier for qualifying co-invested programmes. Greenlight Re will provide reinsurance support for the insurance risk tied to those programmes.

The partnership focuses on a part of the insurance market where newer operators often need several forms of backing at once: capital to build the business, a carrier to issue policies and reinsurance to support the risk. The structure is intended to bring those elements together through a more connected deal flow.

Spinnaker will issue policies for qualifying programmes, while Greenlight Re, through its innovations unit, will identify and support investment opportunities among early-stage insurance businesses.

Existing overlap

The companies already support several of the same insurance programmes that have grown in scale. In those cases, Spinnaker issues policies, while Greenlight Re has invested in the businesses and/or provided reinsurance capacity.

The new agreement formalises that overlap into a more co-ordinated model for reviewing emerging programmes. It also gives Hippo another way to expand beyond its core homeowners business through programme partnerships across personal and commercial insurance lines.

Rick McCathron, President and Chief Executive Officer of Hippo, outlined the company's view of the market.

"We believe the MGA and program market remains one of the most dynamic areas of insurance," McCathron said.

"Our partnership with Greenlight Re brings experience in identifying and backing those businesses, giving us opportunities to participate in emerging innovative programs both as an investor and through Spinnaker's role as their carrier. It supports our strategy to grow across insurance products while applying the underwriting discipline that has shaped Hippo's business - the same discipline that helped build many of our biggest program partners today," he said.

Programme focus

Managing general agents have become an important distribution and product development channel in parts of the insurance market, particularly where specialist underwriting or newer digital models are involved. Their growth has drawn investor interest, but many newer entrants still rely on established insurers and reinsurers to bring products to market.

That helps explain the logic of the deal. By aligning capital from Greenlight Re Innovations, fronting support from Spinnaker and reinsurance from Greenlight Re, the partners aim to create a route for selected programmes to move from early backing to live underwriting support.

Jesse Willmott, President of Reinsurance and Portfolio Management at Spinnaker Insurance Company, said the two groups had already built experience around some of the same businesses.

"This partnership combines Greenlight Re's track record of making significant investments in emerging businesses and Spinnaker's track record of quickly bringing programs to market with the right underwriting capabilities and capacity," Willmott said.

"We already support a number of businesses that Greenlight Re has backed, and this partnership gives us a way to work together to deliver a more efficient model as new programs take shape," he said.

For Hippo, the arrangement also reflects a broader effort to diversify risk across insurance products through its carrier platform. The group has been working with emerging MGA programmes as part of that push, using underwriting experience and carrier capacity through Spinnaker.

Greenlight Re's innovations unit has been building a portfolio of technology-driven insurance businesses since 2018. The company sees the tie-up as a way to give those businesses more options as they expand.

Greg Richardson, Chief Executive Officer of Greenlight Re, said the partnership fits that approach.

"Since 2018, Greenlight Re Innovations has built a diverse portfolio of technology-driven insurance businesses," Richardson said.

"Our partnership with Hippo and Spinnaker gives those businesses more ways to scale, and it fits our focus on disciplined, profitable growth," he said.