Small business customers often find it hard to secure insurance. Poor financial history, a prior conviction, or previous claims can make insurance frustratingly impenetrable for new, high-growth businesses. At the same time, the proliferation of price comparison sites has forced brokers to negotiate with less flexibility than ever, driving down prices in a race to the bottom that satisfies no one.
But innovative MGA Castel knew there was a better way to insure small businesses. By working with INSTANDA, Castel rapidly launched their new underwriting and brokerage platform Square Pegs. The platform is targeted at creating niche small business coverage where it’s needed most and continues to drive success for Castel.
Brokers that use the platform are now empowered, informed advisors of the insurance industry to small business customers. So how did Castel manage to launch Square Pegs so quickly? What can we learn about the success of their platform? How can other MGAs deliver impactful service to small businesses?
Castel’s business model works by partnering with experienced underwriters, helping them to set up their own cells. With Square Pegs, Castel wanted to minimise time to market, without compromising on the vision of a flexible, easy-to-use platform. INSTANDA allowed Castel to create Square Pegs at a much lower cost than was previously possible in the insurance industry.
Launching the first, basic version of Square Pegs in 2019 enabled the platform to start making money. During this time, underwriter Stuart Dickinson built the additional features and functionality that would become Square Pegs Full Business, the comprehensive solution that’s earning the trust of brokers everywhere.
Thanks to the ease of using INSTANDA, Square Pegs Full Business launched in April 2021 and has already delivered impressive commercial results despite the persistent business challenges of the global pandemic. Lockdowns have eased and tightened in the UK over the past year and half, providing a tough environment for small business customers to navigate. Meanwhile, Castel is growing its business at pace.
So what makes the platform uniquely capable of delivering impressive results?
External brokers can log in to the Square Pegs portal and get quotes during small business customer consultations. The Square Pegs platform combines thousands of variables to process complicated criteria and provide a set of easily communicated ratings to the broker.
Automating this process means that premiums worth a few hundred pounds, which wouldn’t have been commercially viable before, can be sold and turn a profit.
The process is slightly different for referrals, as the policies get sent to underwriters at Square Pegs to review, endorse or decline as necessary. Square Pegs ensures that brokers get answers on these queries in the same day, providing them with the tools to operate in line with increasing customer demands.
The crucial piece of added value is that all of this takes place in real time, saving significant cost for all parties in the chain.
By focusing on a broad range of risks that are usually anathema to the insurance industry, brokers can cover a greater range of small business customers than ever before. Small businesses that do require extra detail for their policies can get the underwriting support they need, fast.
The flexibility of the Square Pegs platform allows brokers to place new business, as well as amending or renewing existing policies. As such, brokers that use Square Pegs become an informed advisor in the minds of their customers. Brokers increase the value of their services to their customer base instead of cutting into their profit margins, sharpening their competitive edge.
Building a successful, flexible platform like Square Pegs depended on Castel partnering with the right insurtech: INSTANDA.
From the outset, Square Pegs’s Stuart Dickinson knew that he needed a product builder that could support the flexible rating tool he was looking to craft. Dickinson also knew that he would need the capacity to build the tool himself, as the speed to market couldn’t be slowed down without severely limiting the inflow of capital that the start-up needed to survive.
But it wasn’t just the configurability of INSTANDA that appealed to Dickinson. Even with a clear vision of what Castel would need to get the product off the ground, there were areas in which he needed support. Whenever this occurred, INSTANDA were always on hand to help Dickinson create the robust system he had envisioned for Square Pegs:
In INSTANDA, Dickinson found the solution he was looking for. Dynamic, responsive and supportive, Square Pegs has over 800 regular users and is growing rapidly in the broker community.
Brokers that leverage Castel’s Square Pegs platform serve small business customers in highly competitive ways. With a tailored, bespoke service that takes into account what makes each customer unique, there isn’t a need to drive down prices. Instead, customers’ specific needs are met whilst the broker maintains their position as an essential strategic advisor.
By launching Square Pegs in record time with INSTANDA, Castel has created an industry-leading mechanism for small business owners to insure themselves. The MGA is capable of winning a significant slice of business that will provide impressive growth potential for years to come.
Whether digitising an entire business and multiple books, taking a vertical slice of an existing business, or launching a new innovative product, INSTANDA provides everything you need to take underwriting capacity and insurance brokerage to the next level.
Get in touch today with our team of friendly professionals to streamline your insurance life-cycle.
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