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December 15, 2017

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A power-packed team of financial executives sees big potential in what they consider an underserved homeowners insurance niche: people with outsized checkbooks.

It sounds crazy, admits St. Petersburg insurance executive Stacy Warren, but the uber-wealthy sometimes have super-poor insurance.

Like the person who had layers of insurance for his multimillion-dollar home — yet didn’t insure his original Picasso separately. That’s a classic mistake, Warren says. “You see that a lot,” adds Warren. “It’s problematic in the high net worth insurance industry.”

A onetime AIG executive, Warren, 46, is at the forefront of a new company that aims to solve that problem. The startup, Vault, is based in New York City with an operations headquarters in downtown St. Petersburg, on First Street. It’s backed by a $100 million investment from reinsurance giant Allied World and Stamford, Conn.-based Hudson Structured Capital Management.

Including Warren, seven former AIG executives co-founded Vault in late 2016. The founders include Vault CEO Charles Williamson, who ran AIG’s private client group, among other positions, and was most recently CEO of Tower Hill Insurance Group.

Not only is there anecdotal support for Vault’s strategy from Warren’s career experience, but the potential niche, executives say, comes in a quirk of the strong economy: The number of insurance companies in the U.S. has decreased in the past decade, while the number of high net worth individuals has increased.

“This is the diamond in the rough of the insurance industry,” says Warren, Vault’s chief sales and customer experience officer. “It’s not a transaction business (for high net worth individuals.) You build your book of business around service.”

Vault will write homeowners polices for high net worth individuals, and also cover art, jewelry and pricey collectibles. It offers umbrella packages, and plans to start auto coverage in the near future. The firm works with top-performing independent agents who specialize in high net worth clients, says Warren.

It’s currently only writing polices in Florida, with expansion to South Carolina followed by New Jersey, New York and Connecticut on the next-up list. After that, Vault plans to go west, to California, where there are more pockets of high net worth individuals. The goal is to have $30 million in premiums by the end of 2018 and at least $250 million within five years.

Vault already has 25 employees in its St. Petersburg office, including underwriters, claims personnel, call-center operators and data analysts. It has recruited people from nearby insurance firms, including Heritage, American Strategic and USAA. “We absolutely want to expand here,” Warren says.

Company officials chose Florida, and St. Petersburg in particular, on purpose — and not because it got any tax breaks or incentives to open and expand here. For St. Pete, Warren says it was the superior part of Tampa Bay, with a better employee pool and higher quality of living than Tampa.

On Florida, the obvious draw is its large concentration of high net worth individuals. But another reason Vault sought Florida is a lot of companies are avoiding the state because of challenges in the regulatory environment. Vault attorneys met with state insurance officials in Tallahassee several times going back to December 2016, to make sure they were doing everything right, says Warren. She adds that because the state sets “a high bar” for regulation, “it would be a great first step in our launch.”

Warren has handled other Florida-tough challenges in her career. She got into the industry right after college, when she owned an insurance agency in St. Augustine for four years. She later rose through the ranks at AIG, finding her stride in solving big-department problems. “I became kind of a fixer for them,” she says. “They flew me all over the country, fixing broken departments.”

Warren quickly signed on when Williamson approached her with a chance to start something, not fix problems. A key part to Vault, so far, says Warren, is it can respond to client needs quickly without the legacy issues a big company like AIG might have. That’s especially important with wealthy clients. “We’re all about easy,” says Warren. “We want to make it easy for employees, and make it easy for customers.”

(This story was updated to reflect the reasons why Vault chose Florida to do business, including the regulatory environment.)