The making of a tech-enabled full-stack insurer

Sep 21, 2022 | Innovation

Impossible is temporary. Impossible is nothing.

This week marks a significant innovation milestone for Cowbell. With the launch of Cowbell Specialty Insurance Company (Cowbell Speciality, our E&S carrier in Nebraska) and Adaptive Cyber Insurance – instantiated with our upcoming Prime 1000 program – Cowbell is further cementing its leadership as a tech-enabled full-stack insurer for the cyber SME market. The realization of this milestone is not without the resilience of 200+ Cowbellers and the outrageous sense of urgency with which they operate. We have compressed six years of execution into three and innovated simultaneously, making this cross-industry innovation a reality. We started our innovation journey with continuous risk assessment and rapidly pioneered continuous underwriting for cyber insurance. Our end goal was clear from the get-go: to offer a cyber insurance product that truly aligns with the evolving cyber risk. Cyber risks are constantly changing – an evolving threat landscape, new architectures, expanded attack surface, accelerated digitization, and more. We knew that we had to be truly innovative and offer cyber policies that could evolve with the risk, and certainly much more frequently than once a year.

Earlier this year we introduced Cowbell Re, our Vermont-based reinsurance captive, to enable us to participate in the quota share behind our current offerings in the market. Today, we enjoy support from 15+ A.M. Best A- rated or higher fronting partners and reinsurance carriers, supporting our growth and enabling us to focus on our loss ratios, policy retention, and customer acquisition costs. We maintain the industry’s lowest reported claims at <2% and loss ratios are arguably the lowest in the industry as well. With Cowbell Specialty, we are in a prime position to bring innovative products to market at speed required to address constantly changing market conditions.

As the market shows signs of moderation during the second half of this year, brokers and customers deserve innovation in current offerings. Prime 1000 will provide our policyholders much-needed transparency into the life of a cyber insurance policy: renewal, coverage decisions, and pricing will be available in real time. Furthermore, the product will empower policyholders by giving them the resources needed to improve their cybersecurity posture,  with their investments linked to coverage during the policy period.

There is ample effort in modeling cyber risk for large enterprises with complex infrastructure but the same is non-existent for SMEs across all major models. SMEs are more likely to face supply chain threats than cloud services outages and risk aggregation management requires a risk pool that is representative of the market. We are proud to maintain the largest risk pool in the market at 26 Million businesses continuously monitored across 1000+ data points providing us with an immediate benchmark of any SME applying for cyber coverage. Our continuously monitored risk pool is fundamental to our ability to model SME catastrophic and systemic events, a key component of our vertically integrated platform.

Cowbell started with Prime 100, a simple, automated, relevant, admitted product. Later, we expanded with Prime 250, a robust, customized product. We quickly added Prime Plus – an excess offering – and Prime Cloud, an AWS-dedicated product to address needs from different parts of the market. With Prime 1000, we believe that we will achieve our objective of providing the industry’s most complete and flexible cyber insurance offering, tailored to today’s and tomorrow’s needs of U.S. SMEs. Prime 1000 will launch in the U.S. in Q1 of 2023, after three years in the making.

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