13 February 2017Analysis

KBRA targets insurance industry after poaching Bukow from AM Best

In January this year, Kroll Bond Rating Agency (KBRA) appointed Tina Bukow to the role of senior director – business development for its insurance ratings initiative.

Speaking to Captive International, Bukow clarified her new position. “My role as senior director of issuer relations is a business development role for our insurance vertical. KBRA was established in 2010 to restore trust in credit ratings and has been very successful across many different asset classes. KBRA decided the next logical move would be to the insurance space, the newest initiative for us, entering the market in 2016.

“KBRA is a Nationally Recognized Statistical Rating Organization (NRSRO) which published its methodology for rating insurance companies in 2016 and rated its first company shortly thereafter. We now have eight rated companies in the portfolio with a growing pipeline in the rating process”.

Bukow joined KBRA after twelve years with AM Best, where she was head of business development for insurance. At AM Best she lead a global team of business development professionals in the insurance sector and was responsible for ratings growth in the US, Canada, Caribbean and parts of the Latin American region, with strategic focus on the alternative risk transfer market among others.

“I have been brought on board to help grow the insurance ratings portfolio, for the entire industry including property/casualty, life, traditional companies, captives, fraternals, risk retention groups, and reinsurers, including start-ups. Start-ups will be a major focus for us,” she told Captive International. “We are into it already. I hit the ground running from day one. The first order of business is to get your name out there and contact the people you know, a process I have already started. Next is physically getting out there... I will be attending and speaking at many conferences, in all markets, and will be active with many associations… a true grass roots effort.”

Bukow’s efforts will be similar to what the rating agency has done in other sectors as it has grown as a company. KBRA started off in the structured finance sector in 2011 and now has over 1,000 rated entities or transactions, covering about $600 billion in issuance. Looking at the big picture the company is now active in structured finance, financial institutions and corporates, with insurance being the newest, as KBRA hopes to grow into this sector across the board.

“This is my sole focus at KBRA. All of my time will be spent on this vertical… sun up to sun down”, Bukow explained, adding that as she moves along KBRA will ramp up resources as necessary. Bukow said that the company is fully prepared to add resources as demand drives that. This applies on the rating side as well, so that as KBRA’s portfolio of rated companies grows so will its analytic resources, and that the company is committed to service, with resources being a large part of that commitment. In addition KBRA is currently opening a European office as it seeks to establish a global footprint.

According to Bukow, so far KBRA has been very well received by the insurance industry, and companies and brokers are “very interested” in KBRA’s approach to ratings, as opposed to the mainstream in terms of what is out there already.

“It seems folks are very interested and ready for an alternative and a fresh look across the insurance space,” Bukow explained. “The rating approach here at KBRA is what might be called, more of a 21st Century rating approach. It is not tied to any specific capital model but is based more on a true financial analysis of a company, which seems to be what companies are interested in.”

Bukow said that companies do not want to be looked at in a cookie-cutter fashion, but rather on their own unique characteristics, based on their numbers as they apply to their business model. She pointed out that while there are industry matrixes that KBRA uses for benchmarking, which are very important, but overall she stressed that it will be true financial analysis, along with KBRA’s commitment to service that will quickly set it apart from others in the industry."

She concluded: "I can tell you for sure, KBRA is committed to serving the insurance industry and the users of our ratings. We are in it for the long haul and look forward to providing a new and fresh rating alternative to the industry."

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