Founder-led Solution Underwriting acquired by UK insurance provider CFC

After 14 years in business and with 55 staff spread across four Australian offices, Melbourne-based Solution Underwriting has been acquired by insurance and cyber products provider CFC for an undisclosed value with the co-founders receiving shares in the UK-headquartered buyer.

The move comes just over three years after CFC's acquisition in March 2021 of Gold Coast-based cyber incident response company Insane Technologies, which has since been rebranded as CFC Response.

Similarly, within a year Solution Underwriting is expected to be rebranded to CFC Australia or a similar name to that effect.

Co-founders Rhys Mills and Anita Lane, Solution Underwriting's managing director and director respectively, will continue to lead the business.

"In 2010 we both left our well-paying jobs in insurance, we both mortgaged our homes and we went to IKEA and bought some furniture that we put together ourselves, bought some computers and rented an office and started Solution Underwriting," Mills tells Business News Australia.

He says the business began with just one binding authority with a local insurance provider that is no longer around.

"We had absolutely no business to start with. We wrote our very first policy shortly after kicking off and that to us meant that we’re a proper business – if somebody’s prepared to buy a policy from us, that means everybody else should be," he explains.

"We grew from the two of us working out of that little office to 55 people 14 years later with offices in Melbourne, Sydney, Brisbane and Perth.

"We write a number of different insurance products now with various capacity providers and our capacity providers are unmatched. We've got Lloyd's of London, we've got a capacity with Chubb Insurance, we've got capacity with AIG who are about as good as it gets in terms of quality security to write insurance business with."

With a professional relationship of six years when they started the company, Lane says they took "the biggest leap" to back themselves with a "vision to be able to start a business and an underwriting agency, purely based on our knowledge of the market, our service standards, and what we thought we could do a little bit differently to everybody else".

"We had a good genuine crack as the two of us to the size that it is now," she says.

"In our market, having giant big growth spurts isn’t essentially always a good thing. And it's something that we've always played on that we've never been greedy, we understand our position and our market share.

"We've grown organically, steadily and profitably."

Lane says the company was always servicing all of the Australian market from its Melbourne office, but seven years ago the decision was made to expand into Sydney, splitting up operations into 'northern' and 'southern' regions.

"We did that right until the pandemic hit really – we were able to very effectively manage the whole country, even from a timezone perspective," she says.

"Lockdown taught us that we all had very different experiences, and we appreciated that potentially, boots on ground in local areas with brokers dealing with local underwriters would be an effective tool for us, and that’s when we opened our Brisbane office, and then shortly after that, an office in Perth.

"They have been incredibly successful for us and we’ve seen growth in the numbers change immediately once we had local people on the ground there."

Mills says Solution Underwriting has dealt with CFC for a number of years and has always seen a "very close alignment with their culture, philosophy and the way they do business - very innovative and service-driven".

"We've always really just wanted to provide the best service and that's how we set ourselves apart in the early days of starting the business, because we didn’t really have much else to offer other than the best security we could possibly provide," he says.

"The more we kept doing business with CFC, the more we realised how closely we were aligned with them as a business, which led us to get in touch with (former CFC CEO) Dave Walsh one day, saying if he’s ever keen having a footprint in Australia, please keep us in mind.

"Dave went away and had a think about it, called us back and said 'we're keen'. Fast forward a few months to Tuesday this week and we signed contracts to become part of the CFC family, which other than starting the business is the most pivotal moment of our lives."

Mills says the past 14 years have been an incredible journey, and he looks forward to what the next 14 years bring as part of a larger group, especially with the resources and innovation it provides, and most importantly what it means to staff.

"We've got some younger staff that are starting to pack their bags and wouldn’t mind doing a stint in London," he quips.

CFC CEO Andy Holmes, who was previously the group's chief underwriting officer for the past 20 years before being appointed to the top leadership job in January, says one of the reasons for the Solution acquisition is that the group doesn't have many overseas underwriting offices.

"We weren’t in a massive hurry to have one in Australia, but really it’s about cultural fit. When we got to know Rhys, Anita and their team - and it’s been reaffirmed this week in Australia - the cultural fit feels fantastic," he says.

"You can have all the strategy in the world, but if you don't fit culturally, it doesn't work.

"Our view on the insurance proposition more generally in the future is insurance can't just be a promise to pay; it has to be a promise to protect. And by aligning CFC’s insurance policies with CFC’s response business, we’re actually providing a set of services around the promise to pay."

When asked about the industry more broadly, Lane emphasises the team has seen many cycles and is ready to handle changes as they come.

"We understand the dynamics of the market. Yes, we've been through an incredibly tough and hard market for a few years...we've been here before, and we stay true to what we do," she says.

"The service offering needs to be even bigger and better and more amplified, more specific to a changing market. Our security partners have always been the best we can get, so we're never having to compromise or explain that we're not dealing and policies aren’t being placed with the best policies globally."