Lloyd's of London has approved the creation of a special purpose arrangement, or SPA, within ProAssurance Corp.'s Syndicate 1729.
Howard Friedman, president of ProAssurance's healthcare professional liability group, described the SPA as "a syndicate within a syndicate." The SPA will begin writing business as of Jan. 1, 2018, with a planned premium of $22 million.
"[It] will focus on a portfolio of contingency and specialty property business to leverage the expertise of four new underwriters," Friedman said during a quarterly call to discuss earnings.
The syndicate will retain about 40% of the business written and will cede the rest to the SPA.
Looking at the overall competitive profile in the workers' compensation business, President of Eastern Insurance Michael Boguski said there has been increased competition from regional and national stock carriers in the past three years. But ProAssurance is still looking to expand.
A regulatory hearing for the company's acquisition of the renewal rights to Great Falls Insurance Co.'s workers' compensation book of business is scheduled for late August. He said the company is hopeful it will close shortly thereafter.
ProAssurance will enter its fifth operating region with the transaction, expanding into Maine, New Hampshire and ultimately other New England states, Boguski said.