Kevin Wolfe, president and CEO of Marcato, is one of four veterans who have joined forces to form a new specialized agency, Marcato Marine Insurance Services.
At the end of 2022, the marine insurance veterans established a new branch specialized in marine insurance, Marcato Marine Insurance Services, with the support of Beat Capital Partners, a long-time investor with extensive experience in specialty insurance. The initiative is led by Kevin Wolfe, president and CEO of Marcato. He has over 40 years of experience in marine insurance and is joined by his son, Marquam Wolfe, as well as Jeffrey Hawkins and John Kiernan.
Beat has launched nine businesses since its founding in 2017, which will collectively underwrite US$ 650 million in 2022, and manage Lloyd’s Syndicate 4242. Beat is supported by experienced investors Bain Capital Credit, Elliott Management, and Amwins.
Marcato will have the capacity for limited cargo projects up to $ 147.5 million (combined project- cargo and delayed start), and $ 20 million for cargo / warehouse, hull / defenses and penalties, and maritime liability (primary and superior). There are plans to add to the coastal line sometime this year.
Risk & Insurance: What was the origin of the idea for Marcato? And what is the reason for the name?
Kevin Wolfe: “There is a lot of untapped potential in the marine market. Marine departments (at large insurance companies) have become bloated and crammed into large and complex buildings. When I started there were always marine jobs. Brokers no longer have many specialized marine brokers to work with. Bringing that back is why we set up Marcato.
The name is a musical term for a sound on a note. Many of Beat Capital’s entities have musical names.
R&I: You have a long history in marine insurance. How did you get started?
KW: I am from Chicago and have a bachelor’s degree in business administration from Eastern Illinois University. My father-in-law, who was an insurance agent for Prudential, advised me to go offshore because it was more special and more challenging.
Marine is a pure form of underwriting. It is not controlled by a manual like the auto and other lines. I like that. I use my knowledge and experience every day to determine the correct cost of risk based on terms and conditions.
R&I: Please also tell us a little bit about the rest of the editorial team.
KW: We have both worked with each other before. Together we have more than a century of experience, each of us in his own area. I started in the 1970s in project cargo and general cargo. I worked with Jeff Hawkins at Allianz, on projects and general cargo. Jack Kiernan’s expertise in the body and machinery. Marq Wolfe, my son, was also with Allianz for a short time, and was a trader with Willis for 10 years.
R&I: How does Beat Partners shape the strategy? How did you come to work with them?
KW: Beat Capital up and running. They provide background services (in addition to financial aid). They are an established insurance based company looking for special opportunities.
R&I: The time is perfect, and many coastal lines have been consolidated after many years of weakness and the ability to reduce and the journalists to leave the sector. What key trends are likely to be important this year in marine insurance?
KW: It’s moving in the direction it should be. In the last five or six years, things have become very competitive, and some of the most competitive players are taking incalculable risks. Right now I see the prices staying the same for this year.
There has also been some resurgence (in marine lines) in the reinsurance market. Capital inflows over the past few years have tended to push incomes down. That happened at the same time as some of the secretaries were very confused about the terms and conditions. Profits were not affected for several years but eventually the losses did not match the costs. It’s a double whammy.
It goes back to why we created Marcato. As a clerk you need to understand what you are preparing, and buy accordingly.
R&I: One of the main sources of complaints in the past years are boxes damaged at sea or lost at sea. Is that a job of bigger and bigger ships? How big is too big?
KW: No matter how stable and secure the boxes are on the boat, the g-forces on the boxes at the top of the stack are high when the boat rolls. And we are starting to reach the upper limit for most ships. That is partly due to the operation of the ships themselves, the dangers of the containers, and the cost of the cargo.
R&I: The fire is another increase in information. Research into improved fire protection on ships is underway, but it could be a decade before it hits the seas . What can shippers, shippers, and ship operators do now to reduce this risk?
KW: Fire was still a danger at sea; in container ships especially due to wrong and unidentified cargo. When I talk to my loss control staff, mislabeling and misidentification of cargo is their biggest concern. It is also fair to say that the world is more aware of sea fires because of social media.
As you said, fire protection itself is a marine engineering issue. One thing that is helping the insurance side is artificial intelligence to review notices and bills of lading for potential risks. Even with technology that provides better ways to monitor and contain risks, the most important thing is the cost of insurance according to the risks.
R&I: What are your favorite places, and why?
KW: Even with my entire career in marine insurance, I am not a sailor. My experience at sea is mostly when my family and I go on cruises. My favorite port of call was probably Ketchikan, Alaska, after sailing the Inland Passage. We went to Greenland to see the melting of the ice, and the size of those things was really amazing. We have sailed from the West Coast to Hawaii, passing through the Panama Canal.
My most colorful story is actually, on one cruise we didn’t have our luggage for five days. The only thing I had to wear besides the clothes I wore on the trip was a pair of lime green pool shoes and a bathing suit with little fish on it that I bought at the gift shop. &