Brit’s algorithm-driven syndicate Ki to write $400mn in first year

Brit’s follow-only syndicate Ki, which it claims is the first algorithmically driven Lloyd’s of London syndicate, plans to write some $400 million in gross written premium in its first year.

The disclosure was made as Brit unveiled challenging full year results for 2020, which saw the carrier swing to a  loss after tax of $232 million (2019: profit of $179.9 million) as it was impacted by some $270.7m of COVID-related losses, driving a 15.9% increase in the combined ratio.

Ki is a standalone business, launched for 2021, and the first fully digital and algorithmically-driven Lloyd’s of London syndicate (Syndicate 1618) that will be accessible anywhere, at any time.

Brit has stated that it believe Ki “will redefine the commercial insurance market with its digital and data-first model” and marks “a step change for an industry that is yet to face the disruption seen across the rest of financial services and other industries”.

“With Lloyd’s focus on e-placement and the ever-increasing adoption of electronic trading, we expect the transition in how the Lloyd’s market transacts business to be accelerated”.

According to the carrier, Ki’s algorithm is able to evaluate Lloyd’s policies and automatically quote for business through a digital platform which brokers can access directly.

The selection process is performed using a proprietary algorithm developed with support from University College London and their computer science department.

Ki follows several nominated lead syndicates across the Lloyd’s market, including Brit, and offers brokers a line on every risk in the selected classes led by these markets.

Ki completed one of the largest fundraises of any start-up in Europe in 2020 with US$500m of committed capital invested by Blackstone Tactical Opportunities (Blackstone) and Fairfax. Brit said that this capital commitment has funded Ki’s launch and will enable the business to grow rapidly to significant scale: “With its investors, Ki has the financial firepower to rapidly scale the business and support its plan to provide a truly differentiated offering to brokers and clients.”

Brit said that Ki is continuing to focus on innovation, with two upgrades to the platform deployed in the first 60 days following launch. In 2021, it added, Ki will deliver additional platform capability on the back of broker feedback, broaden out the use of non-Brit Lloyd’s lead markets into new classes and digitally integrate with a number of broker partners.

In October 2020, Ki Syndicate 1618 achieved ‘permission to underwrite’ from Lloyd’s, and in November it bound its first risk, with its line having been generated by its proprietary algorithm, a first in the Lloyd’s market.