Reflecting on 2021: Our Journey Towards the Efficient Frontier

Volatility was, perhaps, the most consistent theme of 2021.

The world experienced both repeated waves of lockdown and the fastest global vaccination rollout in history. The global economic narrative rapidly shifted from a potentially devastating recession and high unemployment to elevated inflation, supply chain shocks, and a tight labor market. Emerging blockchain-based asset classes oscillated from peak to trough to peak — leading to corresponding shifts in regulatory interest and intervention. ‘Meme stocks’ took over the markets at various points in year. The United States, Germany, and Japan welcomed new leaders.

Life, limb, and property, along with insurance markets, were heavily impacted as well. The Ever Given cargo ship blocked the Suez Canal for days, single-handedly delaying almost $10B worth of trade. In June, a condominium building collapsed in Surfside, Florida, burying many of its residents in the rubble. Texans suffered one of the most severe episodes of winter storms in their history leading to severe power outages and major swings in utilities pricing. Hurricane Ida became one of the five costliest on record and a devastating earthquake killed over 2000 Haitians. Just weeks ago, tornadoes razed swaths of the mid-west and killed dozens of people.

These previously rare and extreme events are becoming increasingly commonplace as the world is exposed to greater complexity and interconnectedness. Volatility is here to stay.

Over the past year, this observation has helped us crystallize how Kalepa can most effectively partner with insurers to help businesses cope with uncertainty and financial loss. In working with our clients and partners, we recognize that the power of Kalepa’s Copilot technology is in helping insurers and businesses pierce through volatility and noise, and uncover the evolving risks affecting each insured. Copilot helps to establish a single version of the truth that carriers and business owners can act on. Powered by Copilot, underwriters can deliver insurance products with the pricing and coverage that match the true risk and needs of policyholders. We call this Efficient Frontier Insurance and it’s the way that insurance should always work.

2021 was a pivotal year in Kalepa’s pursuit of our mission to bring commercial insurance to the Efficient Frontier:

* Over $150M in bound premium was underwritten at the Efficient Frontier using Copilot by several of the leading US carriers across general liability, property, workers compensation, and excess and surplus lines.

* In support of that growth, our product team was busy expanding Copilot’s capabilities. We launched Flight Plan, a new module which enables underwriting leaders to achieve complete control and visibility over guidelines and risk appetite, while facilitating dynamic and timely recommendations for underwriters in Copilot to strengthen compliance and improve risk selection. We expanded our support for manufacturing, construction, and hospitality risks, CAT exposed property as well as for larger and more complex insureds with sizeable geographic footprints. We revamped our external-facing APIs and expanded our suite of integrations. We incorporated hundreds of billions of additional data points to bolster Copilot’s ability to identify the needles-in-the-haystack which materially change an underwriting decision.

* We announced a $14M Series A financing led by former US Secretary of Commerce Penny Pritzker’s Inspired Capital with participation from IA Ventures and leaders in financial services and technology including Gokul Rajaram from Doordash, Coinbase, and formerly of Google and Facebook; Jackie Reses, from Affirm and Wish, and formerly from Square; and Henry Ward from Carta. In addition, insurance legend and long-time Kalepa friend Mario Vitale joined our Board of Directors.

We are excited and humbled by our mission to make insurance work the way it should. If you have interest in partnering with Kalepa, we look forward to talking. If you are equally energized by our mission and take pride in your grit, transparency, meritocratic approach, customer focus, and experimental mindset, our core values, please shoot me a note — we are hiring for many roles.

As always, we thank our customers and partners for their trust, feedback, and support.

Wish you a Happy and Prosperous New Year!

Paul Monasterio

CEO and Co-Founder, Kalepa