Built for what goes wrong
Insurance businesses are built around uncertainty, but Paul Brand, group CEO of Convex, has a particularly simple test for how seriously they take it.
“We live in a world which has always had lots of downside risk, and therefore have to ensure that the organisation is built in a resilient way. One has to be thoughtful about risk. What can go wrong has to be considered far more than patting oneself on the back if everything goes according to plan,” Brand told Bermuda:Re+ILS.
It is a philosophy that reaches beyond underwriting. Seven years after Convex began writing business, the company is moving into a different stage of its development. The advantages of its beginnings remain important: substantial capital, no inherited legacy and a team assembled for the market it expected to encounter rather that which existed when it launched. But the emphasis is increasingly on making those advantages durable.
For Brand, that means strengthening the business behind the underwriting, maintaining close relationships with clients and distribution, securing stable capital and preserving the independence to make decisions for the long term.
That focus comes as the wider market is changing again. Pricing is already moving significantly in some classes, competition is increasing and Brand expects further consolidation. At the same time, insurers are confronting a risk landscape that includes geopolitical instability, climate exposures and a cyber threat whose systemic consequences, he believes, have yet to be properly tested.
Convex’s response is not based on the assumption that favourable conditions will persist; quite the opposite.
A start-up advantage worth protecting
Convex arrived in the market in 2019 as an unusual combination: a new company backed by an experienced leadership team with a weighted history in the market.
From the outset, Convex was not designed simply for the market in which it was launched. “As a new market entrant with considerable heritage, it was our ambition to lead business in the majority of classes that we write. We set out to build a team that could write line sizes in 2026 rather than 2019,” he said.
Convex has moved well beyond its launch phase, and the question now is how to preserve the qualities that made being new valuable in the first place. “It was also important we didn’t, and do not, waste the advantage of a well-capitalised start-up with no legacy and that flows through our business model today,” Brand said.
So the next stage will involve investment in what he calls “the backbone of the business”, alongside the continued focus on clients and distribution. Culture sits alongside those priorities. Brand said: “Our culture is also fundamental – as a business we want to be useful to society and business as a whole.”
There is a sense throughout his assessment that becoming established should not mean becoming complacent. Convex was deliberately built for a market beyond the conditions immediately in front of it. The test is to carry that forward.
Bubbles are inevitable
That fact becomes particularly relevant as the underwriting environment changes. After several years of favourable conditions for carriers across significant parts of the market, the question increasingly facing management teams is how much discipline will survive as competition intensifies.
Brand’s assessment is nuanced: “We are still near the top of the market on average with some lines of business still improving but others, such as property, are rapidly decreasing,” he said.
On whether the industry can maintain pricing discipline, however, he is less inclined to assume insurers can somehow overcome the forces that have shaped previous cycles. “As far as pricing discipline is concerned, it is all down to human nature, and one can’t satisfy all the people all the time,” he said. “Unfortunately, ‘bubbles’ are an economic certainty.”
For Convex, the answer is not to pretend those cycles can be eliminated. Instead, Brand returns to the relationships the company chooses to foster: “We look to build long-term relationships with quality clients which limits our downside (and our upside).”
The final qualification is what stands out in Brand’s approach. Long-term relationships are not presented as a route to extracting the maximum possible return from every stage of the cycle. Brand explicitly recognises that there is a trade-off. The same relationships that can offer protection as conditions deteriorate might also constrain the upside available elsewhere.
It is a philosophy that carries through to Convex’s approach to growth. As competition increases, Brand does not identify a particular class or pocket of the market that Convex intends to pursue. Instead, he returns again to selection.
“We focus on our clients – not all clients are the same and not all risks are the same. We look to work with the best clients in each sector and service them as well as possible to secure their loyalty,” he said.
Convex applies the same thinking on the other side of its balance sheet through its outwards reinsurance programme, where Brand says the company has “the advantage of very stable partners”.
If bubbles are inevitable, resilience depends on the quality of the business, capital and relationships carried through it.
Not looking over its shoulder
Convex took another significant step towards that longer-term position in late 2025. “We were delighted to recapitalise with two strong partners in late 2025. For 2026 and beyond, we have secured long-term independence and high-quality capital,” he explained.
For Brand, the importance of that transaction is not confined to the capital itself. It gives Convex clarity over its ownership and strategic position at a time when he expects the structure of the wider market to continue changing. “We expect to see more consolidation in the market, and are delighted (and relieved) we will not have to deal with that challenge,” he said.
The relief is telling. M&A can offer opportunities, but also consume management attention. Convex’s position, as Brand describes it, allows the company to direct that attention elsewhere. “As a result, we can concentrate on our business and its future and not have to look over our corporate shoulder.”
It marks an important point in Convex’s evolution. The company began with the advantages of a well-capitalised start-up without legacy; it now has capital intended to underpin its independence for the longer term. The objective, however, remains: preserving the ability to concentrate on underwriting, clients and the development of the business rather than allowing external pressures to dictate its direction.
Bermuda’s concentration of capital
That emphasis on strong foundations also informs Brand’s view of Bermuda. Competition among global reinsurance jurisdictions has intensified, while Bermuda itself has had to adapt to the introduction of corporate income tax. Brand does not dismiss the significance of that change, describing its introduction as “a challenge”.
But he is equally clear about why he believes the island will retain its position: “Regulation has to be at the top of the list together with the agglomeration of capital on the island.”
Those two characteristics are difficult to consider separately. Bermuda combines a concentration of insurance and reinsurance capital with the regulatory framework around it, and Brand believes that remains more important to the island’s competitive position than its changed tax environment.
“I do not believe Bermuda will lose market share as a result. A strong regulatory environment beats a bit of corporation tax!”
It is characteristically concise, but it speaks to a broader priority running through Brand’s answers. Whether discussing Convex’s own capital, its reinsurance relationships or the jurisdiction in which it operates, his emphasis is on structures that can endure changing conditions rather than advantages that depend on one moment in the market.
Thinking harder about the downside
Those structures become more important as the range of risks insurers are being asked to contemplate expands. Cyber, geopolitical instability and climate-related exposures are all influencing conversations about portfolio construction. Brand’s starting point, however, is that uncertainty itself is hardly new.
He insisted that the organisation must be built for resilience because downside risk is inherent. It is a deceptively straightforward observation. The individual risks confronting insurers change, but the need to construct a business capable of absorbing unexpected outcomes does not.
For Brand, that requires more than modelling the expected, as the next major challenge might not resemble the last. It is easy to assess an organisation by its performance when assumptions hold. The more difficult question is how it responds when they do not.
Brand’s comments on the history of balance-sheet carriers offer one example of why he is wary of assuming that the direction of travel at any particular point will continue indefinitely. “If you go back 10 years, balance sheet businesses were considered to be ‘bust’; it was all about ILS and the tide was going out for carriers. This was clearly not the case as there have been positive price adjustments and carriers have continued to pay claims and provided decent returns for shareholders,” he said.
For Brand, the experience is a reminder of the danger of extrapolating too confidently from prevailing conditions. Capital structures, pricing environments and perceptions of where value sits in the industry can change. The ability to withstand those changes remains fundamental.
Built for the next test
There is no attempt in Brand’s outlook to predict precisely what the next test will look like. The underwriting cycle will move, property pricing is already declining rapidly even while other classes continue to improve and consolidation is likely to continue.
Against that backdrop, Convex’s priorities for its next stage are notably grounded. Improve the backbone of the company. Maintain the focus on clients and distribution. Work with quality insureds. Preserve stable reinsurance partnerships. Hold high-quality capital. Protect long-term independence. Remain curious enough to change.
It is an approach rooted in Convex’s beginnings but increasingly directed towards permanence. But perhaps the clearest indication of how Brand thinks about the next phase comes not from what he expects to go right, but from his insistence on contemplating what might go wrong.
The insurance industry has already seen confident predictions overturned. Balance-sheet carriers that were once thought to be facing an ebb tide have continued to pay claims and generate shareholder returns. Market conditions that favour one model, class or source of capital do not last indefinitely.
The next challenge might be different again. For Brand, the answer is not to assume it can be avoided. It is to build a business capable of meeting it.
Read the full Bermuda:Re+ILS Annual 2026 here.
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