Lisa Davis joined Canopius USA, a unit of Lloyd’s insurer Canopius Group Ltd., as president and chief underwriting officer in September 2020 with a vision to build on the strengths of its U.S. operations and Lloyd’s syndicate to create a multiplatform approach to serving the U.S. specialty insurance market. She became CEO, U.S. & Bermuda, in February. Ms. Davis, based in Charlotte, North Carolina, spoke with Business Insurance Deputy Editor Claire Wilkinson, about Canopius’ strategy in the U.S. and its plans for future growth. Edited excerpts follow.

Q: What is Canopius looking to do in the U.S.?

A: In the U.S., we’re looking to build out a specialty platform that allows our underwriters to be able to access our syndicate paper, our company (excess and surplus lines) paper, and then also admitted paper with our partnership with Samsung Fire and Marine Insurance. So we’ve been quietly, as we like to call it, building out this specialty-type groove over the past several years that allows us to offer a unique flavor by being able to write business across a variety of different papers, different lines, different classes.

Q: It’s almost 18 months since you joined Canopius. How is it going?

A: It’s going well. We doubled our gross written premium in 2020 and 2021 in the U.S. and Bermuda. At the end of 2020, gross written premium was $200 million, and at the end of 2021 it grew to $400 million. We’ve also shored up our infrastructure and expanded our talent over the past 12 to 18 months because our people are our most important asset. Having the paper and the platform is important, but you’ve got to have the people to be able to deliver on that. We have around 70 employees in the U.S., up from about 49 when I joined, and we are looking to add another 20-plus this year. We want to add underwriters, but we’re also looking to shore up our operational side. We hired a chief operating officer and a chief financial officer in 2021, and this year I’m going to bring on a chief underwriting officer. We currently have offices in New York and Chicago, but we also have people in Atlanta, Charlotte and San Francisco. In the future, I would like to see maybe three or four office footprints.

Q: What lines of business is Canopius writing in the U.S.?

A: The main lines of business that we write in the U.S. are property, auto physical damage and motor truck cargo, surety, ocean marine, management professional lines, cyber and some general liability. 

We’re seeing growth across the board, but the majority of the growth is coming from management professional lines, cyber, auto physical damage and motor truck cargo. We’ve recently reduced our wind exposure and are no longer writing wind exposure in U.S. property binders, so that has decreased our overall premium in the property line of business. The past five years have been tough from a cat perspective, and with climate change and other forces we were struggling to find a way to do that and deliver shareholder value. The biggest lines of business in the U.S. are auto physical damage and management professional lines which make up almost half of the U.S. book.

Q: How much surplus lines business does Canopius write?

A: About half of our business is completely surplus lines, written on our E&S company paper and the other half of our business is written primarily on Lloyd’s paper, which I think of more as standard market but specialty business. There is surplus lines business in that Lloyd’s book. So, the actual split is probably about 60% surplus lines, 40% more standard/admitted/non-E&S type business.

Q: Canopius recently signed an agreement with Samsung Fire and Marine Insurance to write U.S. admitted business on its paper. How’s that going?

A: It’s going well. We are writing management professional lines and our ocean marine business on Samsung’s A++ paper. Almost 90% of our ocean marine business and about 60% to 70% of our management professional lines business will be written on Samsung paper this year. We will be adding another line of business, hopefully within the next 30 to 60 days, and we’ll continue to look to add other lines of business as well.

Q: Are there any plans for Canopius to become an admitted insurer in its own right?

A: We don’t have any plans at this point to get our own admitted paper. Right now we’re looking to utilize our partner Samsung’s paper. Samsung is a strategic investor in the organization, with a 19% stake.

Q: How do the nonadmitted and admitted businesses work together?

A: Our nonadmitted book is primarily a delegated book of business. The difference is that our nonadmitted book is primarily delegated through MGAs at this time and then our open market book is the main book on an admitted basis.

Q: Are you writing any construction business?

A: We started writing a little bit of construction just this year, a month ago. We are looking at potentially doing something in the construction space but nothing official at this point in time. I don’t know that we’ll go into the liability side, but we may look at some of the short-tail lines on the construction side.

Q: How about cyber? Are you looking to grow that line of business?

A: The business itself will grow, but it will grow by rate, not so much by exposure. We are managing our cyber exposure and making sure that we’re as comfortable as we think we are with the exposure that we have. We implemented a new strategy this time last year on cyber where we reduced our limits, took higher excess positions and tried to get ourselves out of ransomware and some of the things we’re seeing. We haven’t changed our position on that within the last year.