AIG, Hamilton and Two Sigma combine for SME platform
American International Group (AIG), Bermuda-based Hamilton Insurance Group, and affiliates of Two Sigma Investments, have entered into a non-binding memorandum of understanding (MoU) to form a joint venture that will establish an insurance platform for the small to medium-sized enterprise (SME) market.
The joint venture will be technology-enabled and customer-centric. It will combine Two Sigma’s proprietary data science and technology platform, Hamilton’s technology and underwriting expertise in the SME market, and AIG’s SME capabilities and global presence to become prominent in the $76 billion North American SME market.
The venture is expected to deliver pricing and servicing using predictive analytics and an easy-to-use customer interface. Additionally, Two Sigma will partner with both AIG and the joint venture to develop specialised asset allocation solutions for the unique characteristics of insurance investment portfolios.
Brian Duperreault, Hamilton chairman and chief executive officer (CEO), will serve as chairman of the Board of the joint venture. Richard Friesenhahn, currently executive vice president of US casualty lines at AIG, will assume the position of CEO.
“Hamilton was founded on the premise that technology will redefine the manner in which insurance products are assessed, priced and distributed, particularly in the small commercial market,” said Duperreault.
“Since establishing our partnership with Two Sigma and our start-up operations in New Jersey, our belief in this premise has been validated by the enthusiastic reception we’ve received from wholesale and retail partners throughout the US.”
Duperreault’s sentiment was echoed by David Siegel, Two Sigma's co-founder along with John Overdeck.
“From the formation of Hamilton, we have worked closely with Brian and his team to bring Two Sigma's capabilities in data science and technology to transform the insurance industry,” said Siegel.
“This partnership brings tremendous scale, the ability to provide a more convenient and systematic insurance experience for small businesses, and an opportunity for us to address the challenge of optimal insurance asset allocation.”
Peter Hancock, president and CEO, AIG, added: “With this venture, we want to revolutionise the SME market through technology that creates a more tailored and compelling value proposition for clients in this critical segment. Our collaboration with Two Sigma will help provide innovative and integrated solutions to the complex optimisation problems related to the assets, liabilities and capital of an insurance company.”