Genstar Capital Management L.L.C. is establishing a new commercial and residential earthquake insurer, the San Francisco-based private equity firm said.
Palomar Specialty Insurance Co. “initially will focus on the residential and commercial earthquake markets in earthquake-exposed states such as California, Oregon, Washington and Missouri, where consumers tend to have limited options to purchase earthquake insurance,” Genstar said in a statement Wednesday.
The new company, with initial funding of $75 million, will be headed by David M. “Mac” Armstrong, former president of Arrowhead General Insurance Agency Inc.
“Genstar’s investment in Palomar follows a proven growth strategy in the insurance industry and one that we at Genstar have utilized to create strong and growing companies operating in niche sectors of this market,” said J. Ryan Clark, managing director at Genstar, in the statement. “Palomar is well-capitalized, and we look forward to working with Mac and his extremely talented management team to pursue the growth and development initiatives we have identified in the approximately $4 billion earthquake insurance market.”