Reciprocal Insurer PURE Chasing Wealthy with National Expansion
September 11, 2010
Insurance & Financial Advisor - 10/12/10
By Bob Graham
The Privilege Underwriters Reciprocal Exchange (PURE) is expanding nationally in an effort in part to follow the money, according to its chief executive.
The insurer of high-value homes, autos, jewelry and art is working to obtain licenses to sell insurance in all 50 states, with an emphasis on wealthier portions of the nation, Ross Buchmueller, president of the Miami, Fla. and White Plains, N.Y.-based reciprocal insurer, told IFA.
"It was always our intent to be licensed everywhere," said Buchmueller, who founded AIG Private Client Group and served as its president until 2006, when he and other partners established PURE. "Some of this is the reality that some of our membership may have properties in different states."
He characterized the percentage of its current 7,000 policyholders having additional properties it can insure in other states as "pretty small."
In the last few months, the company, a member-owned, reciprocal insurer, has gone from nine states to 18 states in which it is has licenses. New states include Alabama, Arizona, Mississippi, North Carolina, Massachusetts, Oklahoma and South Dakota.
Although it will eventually hold licenses for all states, Buchmueller said he anticipates about 18 to 20 states, primarily those states with the greatest number of high-value assets, to generate the bulk of the company's business.
The company, which wrote its first policies in Florida, has tipped the scales in the last year so that more of its policyholders are outside the state than inside it, he said.
In new states, the carrier plans two strategies to generate interest in what he described as "an old fashioned mutual [insurer] with new ideas." In states where population and media are concentrated, then the company will advertise its offerings. In states like North Carolina, where the media and population are fragmented, the company will rely more heavily on independent agents to spread the word, Buchmueller said.
"We just think, where possible, it's easier if people are asking for PURE by name," Buchmueller said.
He also hinted that the company is close to signing a deal to base a hub in the Chicago area, further expanding its geographic reach.
PURE currently operates in Florida, where it is domiciled, as well as in Connecticut, Georgia, Maryland, New Jersey, New York, Rhode Island, South Carolina, Texas, and Washington, D.C