Skyward Specialty partners with Understory on hail threat
Understory, a provider of innovative insurance solutions for climate risk, and Skyward Specialty Insurance Group have partnered to launch a new insurance solution to help US automotive dealerships control the rising cost and instability of dealership inventory coverage, or dealers open lot (DOL).
“To date, insurers haven't addressed the growing threat of hail, which is the biggest risk within standard open lot coverage. Instead, they have asked dealerships to write bigger checks for less coverage,” said Alex Kubicek, co-founder and chief executive of Understory.
The new solution combines Understory's weather technology and expertise in risk mitigation with Skyward Specialty's underwriting, claims and captive experience to pioneer a mutualised captive property insurance structure. The program is member-owned and controlled with competitive premiums and allows dealerships to make decisions to enhance their asset protection. Additionally, the program's members share in underwriting profits, which standard insurance companies typically retain.
“We're thrilled to partner with Skyward Specialty to deliver this innovative solution,” said Kubicek. “Marrying our weather modelling and technology with their track record and expertise in P&C and captives solves dealerships' ongoing struggle to find superior coverage in a market that continues to see increasing rates and volatility from standard DOL models.”
The program, which launched on September 1, 2022, already has its first members and a pipeline of potential members generated in partnership with a select group of specialty DOL brokers, the companies said.
“The severity and unpredictability of hailstorms and other risks have driven the market to provide inadequate insurance solutions for dealerships. We are proud to partner with Understory to create an unmatched innovative risk solution to solve this challenge,” said Andrew Robinson, chief executive at Skyward Specialty. “Applying this level of data science to solve the climate challenges unique to this market and combining it with our highly specialized underwriting and claims talent will ultimately reinvent risk management and risk transfer for owners of automotive dealerships. Our partnership with Understory is another example of our strategy in action.”