Exclusive: Beeson set to launch cyber-focused retail broker Galahad targeting SME sector

By David Bull

March 21 - (The Insurer) - Former Lockton executive Ben Beeson will launch specialty retail insurance broker Galahad Risk Solutions at the end of the month, aiming to address the “last mile” of cyber insurance by targeting the SME segment.

Beeson has a long track record in the cyber risk and cybersecurity space. He spent a decade at Lockton, latterly as cyber practice leader, before helping to launch Arceo, which subsequently transitioned to an MGA and rebranded as Resilience.

He was most recently vice president of strategic partnerships at cyber security company BlueVoyant, which was launched by former Morgan Stanley COO Jim Rosenthal.

Speaking to Cyber Risk Insurer, Beeson revealed that Galahad has signed an agreement with CRC Group’s INSUREtrust cyber practice group to collaborate with the wholesaler and access its products and services.

These include market capacity access as well as risk management tools and analytics capabilities.

CRC formed the Christiaan Durdaller-led cyber practice group by integrating INSUREtrust, formerly housed in its Starwind division, into its wholesale brokerage last April. It now sits in its CRC Specialty business.

Beeson told this publication that despite the emergence of a significant number of cyber MGAs in recent years, small and middle-market businesses continue to be underserved. He attributed this to a dearth of cyber expertise at some brokers, limiting their ability to educate their clients about the benefits of buying coverage and risk management services.

He noted that there are around 33 million businesses in the US that come under the category of up to $100 million in revenue. At the smaller end of the scale there are hundreds of thousands of businesses that have between $500,000 and $1 million in revenue.

“You could describe this as the last mile of cyber insurance. Despite all the great innovation and technology that’s been built into some of these MGAs that have emerged, as well as some of the incumbent insurers, the distribution still remains through brokers.

“It doesn’t solve the problem that the broker has to be able to educate the client, make them feel comfortable enough that they understand their risks and that they ultimately want to buy cyber insurance,” he said.

Beeson added that after spending time in both the broking and cybersecurity industries he brings the experience of communicating cyber risk issues both with finance and IT security stakeholders.

Washington, D.C.-based Beeson said the initial focus of Galahad will be on the DMV area (D.C., Maryland and Virginia), targeting small to middle-market businesses typically with up to $100 million in revenue.

The company has already assembled a small team in preparation to begin operating on March 31. It will source business through channels such as relationships with private equity and venture capital firms in D.C. and Virginia to access their portfolio companies.

It will also target trade associations in D.C., such as the National Retail Federation, and industries with significant volumes of personally identifiable information.

These industries include healthcare, retail and higher education.

“There are plenty of those businesses in the three regions and across those three industries. A lot of the automation and the ability to service the business will come through the INSUREtrust partnership,” Beeson explained.

“A lot of SME businesses are serviced pretty much automatically by MGAs and brokers. That will allow us to scale pretty quickly. If we need to service something for a bigger company, and need to build a tower of insurance, the team at INSUREtrust can help us do that,” he added.

He noted the wholesaler that Galahad is partnering with has access to the global insurance market, including London.

Commenting on the value he and his team aim to bring to potential insureds, Beeson said: “It’s the ability to help clients identify their cyber risks, what the key threats are to them and their industry, and quantifying those both in terms of the size of risk but also what that means in terms of insurance.”

“I think those services have been really lacking, particularly for smaller businesses, and they are key to opening up a conversation with them. The tools exist, including analytics capabilities, to be able to do this. But you’ve got to be able to speak to the buyer and communicate to that stakeholder,” he continued.

The executive added that Galahad clearly defines itself as a broker, rather than a consulting firm, and will generate its revenue from placing risks.

The startup has not at this stage taken on outside investment. It has secured licenses to operate in the DMV area and will look to broaden its footprint as opportunities arise in other states.

While its initial focus is on cyber, the intermediary will broaden its offerings into adjacent lines based on market opportunity and demand.