Follow the Plan

Risk management experts Ricardo Espino and Lora Rees took a big chance when they launched a new insurance company in a down market in summer 2011.

But the risk, so far, has paid off. The firm, Lakewood Ranch-based Centauri Specialty Insurance Holdings Inc., is now building a property insurance portfolio in several states. “We have grown nicely and according to plan,” Espino says. “We have not moved from our strategy.”

The strategy at Centauri, named for Alpha Centauri, the brightest star in the southern constellation, partially revolves around going into states with depopulation programs. Those are states where insurance regulators have elected to pare down the total number of policies on state-backed insurance rolls. Other growth has come from generating new business.

Centauri officially entered three states in 2012: Louisiana, Alabama and Mississippi. The firm also has a presence in Hawaii. That stems from a book of business worth about $12 million it bought and spun off from Sarasota-based Universal North America in summer 2011. Rees and Espino are former executives with Universal.

The firm began to write policies in Louisiana in March, Espino says. Through early December it had $8 million in policies in the state. Says Espino: “We've been accepted very well there.”

The company, furthermore, made its Alabama debut in July and its Mississippi debut in November. The firm reached $1.4 million in policies in Alabama by December, Espino says, while the Mississippi operation was just getting going. The company also spent the last few weeks of 2012 working on entry into Oklahoma, which should be ready by early 2013.

The plan, says Espino, is to focus on those four states in 2013. Then, in 2014, the firm hopes to begin writing policies in Texas and the Carolinas.

The state-by-state expansion plan, meanwhile, both from new policies and depopulation programs, has already fueled company-wide growth. Centauri had $20 million in premiums in 2011, and Espino projects the firm will surpass $30 million in 2012. He hopes to reach at least $50 million in 2013. The company now has 15 employees in all the states in which it does business.

Espino, looking back over Centauri's first full year in business, says the ability to stay nimble and flexible, especially during storm season, has been a key driver behind the success. “One of our strong points is to change on a dime,” says Espino, “when change is required.”

Espino and Rees say another potential change for the company, though not in the short-term, could be to eventually write homeowners' policies in Florida. It hasn't done that yet due to what many in the industry consider the state's hostile regulatory attitude toward insurance businesses, mostly under former Florida Gov. Charlie Crist.

Espino's disposition on insurance in the Sunshine State has recently begun to soften a bit. “We do believe there are opportunities in the state,” says Espino. “Things are turning in the right direction.”