“The world of insurance is vast,” says Jamie Sahara, founder and president of Applied Underwriters. Sahara recently chatted with IBA about insurance dealmaking and the secret behind long-term value creation.
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“The property and casualty and the life sectors each are trillion-dollar industries,” Sahara said. “Every aspect of modern life and commerce is dependent upon insurance and the risk transfer it provides. Yet, despite its sheer magnitude and maturity, the insurance industry remains fragmented operationally and fragmented by ownership. This allows a lot of entrepreneurial opportunity for anyone willing to apply themselves.”
Applied has realized 40 insurance and reinsurance transactions over the past decade – 20 of which have been realized since October 2019. However, Sahara said the company approaches each deal thoughtfully.
“We are not in the deal business, per se,” he said. “We make deals to build long-term value concordant with our greater enterprise. That proposition is, for me, endlessly interesting and challenging. Building real value requires a lot of thought and vision, as well as the articulation and execution of a viable and coherent thesis.”
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Sahara said that while there’s been a lot of consolidation in recent years, with giant companies getting even bigger, that’s not the whole story for the sector.
“At the same time as we’ve seen some large company consolidation, there’s also been a lot of deconsolidation and dislocation,” he said. “For us at Applied, we’ve uncovered in the last few years many opportunities to acquire top-notch entrepreneurial talent and quality operations from larger organizations. There are pros and cons to being a smaller company; there are pros and cons to being a bigger company. The issues the big and small company each face are not the same, and the contention between the two perspectives is what yields opportunities for all sorts of entrepreneurs within the vastness of the insurance industry.”
