Pen Underwriting’s CEO on where the business goes next

It was in 2020 that Pen Underwriting CEO Tom Downey (pictured) first announced the underwriting and distribution giant’s ambition to hit £1 billion in GWP by the end of 2025. The last four years have seen Pen accelerate its growth trajectory with Downey noting that the business is close to hitting its target, if not by the end of 2024, then very early in 2025.

So what’s next for Pen, its customers, its people, its brokers, its investments and its strategy? According to Downey, the focus is on strategic acquisitions, strong organic growth and an emphasis on the people at the heart of Pen.

“Culture carriers”

“I live my life by a simple mantra, that everybody wakes up with a choice – they can come and work for us at Pen or they can choose to leave us and go somewhere else,” he said. “So, our job at Pen is to make it a place people enjoy whether they’re in trading, actuarial, claims handling or govenance, they’re the experts and my job is to empower them to do their jobs and make the right decisions.”

A recent employee engagement survey conducted by Ixia saw Pen receive an 81% engagement score, ranking it in the upper quartile in the financial services industry. This metric, alongside Pen’s attrition rate which stands at less than 10%, is a clear reflection of the business’s values, he said, and a central element of his role sees him go out to visit Pen’s teams, based around the UK, and listen to and act on what they have to say because, “great people do great things”.

Every person and every leader in Pen has to be a “culture carrier” to help carry the business forward, he said. That emphasis is shared not just across Pen’s existing business but also all the key acquisitions the firm has made, including that of Manchester Underwriting Management and Pen’s marine team, newly established last year through acquisition.

“The leaders we’ve brought on understand Pen and we learn from them too,” he said. “I’m not so arrogant as to think that we can’t learn. And I’ve said to those guys at six months in, don’t tell me what’s working, tell me what’s not working for you. Tell me the things we’re not doing because it’s in the things we’re not doing right that you learn.

“Everybody should be thinking about what they’re going to learn and how they’re going to improve. That’s how am I going to improve individually, as Tom Downey, how is my team going to improve, how is Pen going to improve? Every time we fix just one or two things, we’ve made it a little bit better – which will manifest itself back to the brokers, who manifest that back to their customers.”

Key to a successful growth strategy

Downey noted that crucial to the way Pen operates is that its investment in a business doesn’t stop upon completing the acquisition, as recently seen in the firm’s decision to take a box at Lloyd’s, which will be manned by its team of specialist marine underwriters. The acquired businesses came in at about £90 million in GWP and has since grown about 35%.

“We also acquired Fender in Norway, another marine business to build out our marine practice internationally,” he said. “That was our first foothold out of the United Kingdom into the EEA territory which was quite exciting for us. Manchester Underwriting has continued to build and grow, and the rest of our business has continued to build and grow organically as well.

“Our business has grown significantly from this time last year to where we are now and that’s down to all the people in Pen doing a great job for brokers and our brokers’ customers. If you do those things well, people will come and seek your products. That’s really what it’s all about.”

As for what the future holds, he highlighted that the emphasis within Pen is to keep doing what it’s doing – particularly as it gets close to hitting its £1 billion in GWP target and starts to look at what’s next. If Pen ranked itself as an insurance company, it would be the 14th biggest insurance company in the UK by GWP. So, the question is, how does it get into the top 10?

“What will it take to achieve that?” he asked. “What businesses do we acquire? Where do we acquire those businesses? Those are the new questions now.”