Travelers explores sale of Corvus’ Frankfurt-based operations

By Michael Loney

April 25 - (The Insurer) - Travelers is exploring a potential divestiture from cyber insurtech Corvus’ Frankfurt-based operations, multiple senior cyber sources have told Cyber Risk Insurer.

Details regarding the motivation for selling the regional operations could not immediately be confirmed, but multiple sources familiar with the matter said Corvus is “refocusing” its operations towards the U.S. and London, with the UK now becoming the base of its European business.

Travelers’ progress towards a sale of the European business could not be confirmed. This publication could not obtain details regarding whether it has retained an advisor, or whether if would retain or shut down the operations if it were unable to strike a deal.

Multiple senior cyber industry sources, however, said that a handful of strategic buyers have been approached about potentially acquiring Corvus' operations in the region.

Travelers acquired Corvus last year for $435 million. The carrier finished 2024 with $43.36 billion in net premiums globally, of which a relatively small portion originates from Europe, with the Alan Schnitzer-led company's writings largely concentrated in the U.S.

Corvus was founded in 2017 by Phil Edmundson, who left the company with the closing of the deal with Travelers.

Based in Boston, Massachusetts, Corvus has marketed itself as a cyber insurance MGA supported by a proprietary AI-driven cyber risk platform.

Travelers and Corvus originally teamed up on a multi-year capacity deal for European business that was announced in November 2022, offering local brokers and policyholders coverage for enterprises with up to 1 billion euros ($1.14 billion) in revenue, primarily focusing on risks out of Germany and Austria.

Travelers then expanded its capacity partnership with Corvus in October 2023 to include U.S. products, in addition to its existing arrangement for the Corvus Smart Cyber Insurance offering in the continental European market.

A spokesperson for Travelers and Corvus declined to comment.

CORVUS BRINGS DATA AND WHOLESALE BENEFITS TO TRAVELERS

In an interview with Cyber Risk Insurer in early March, Travelers enterprise cyber lead Tim Francis and head of cyber risk services Lauren Winchester had discussed the integration of Corvus since the acquisition closed at the start of 2024, highlighting the insurtech’s data and wholesale access.

Francis said the acquisition had “paid dividends”, adding: “Primarily the reason for the acquisition was not necessarily buying an MGU, but making sure that we were able to get better than we had been at doing some things [such as] what we call the scanning, understanding what is the threat environment of our customers.”

He explained that this takes a lot of data and analysts.

“We need control over the data,” he said. “That was one of the things that we really wanted to get to. When we started talking with Corvus that's something that they did really well, and we thought that would extend into the broader Travelers portfolio, and it has.”

Francis said that a lot of cyber insurance is transacted through an API connectivity. He said that Travelers could previously be slowed down in this because changes to admitted products need to be filed, making it harder to connect to an API “where you don't want to get locked into something”.

“So with Corvus, we not only had the digital connectivity, we not only had access to the scanning, but we had access to a surplus lines product, which gave us a little bit more creativity. And on top of that, they do a lot of business with wholesale producers,” Francis said.

“Travelers does a lot of business with retail producers. And so that allowed us access to different distribution and so that's created lots of opportunities,” he continued.

Winchester said that Corvus has kept its brand for wholesale business, but uses the Travelers brand for the cyber risk services which it launched to support all Travelers cyber policyholders.

“We felt it was important to have that strong Travelers branding, regardless of the distribution channel,” she said.

Francis believes there is an opportunity to drive growth through extending the Corvus capabilities into the more traditional insurance areas “without breaking the speed and the efficiency and the innovation ability of that, whether it be E&S or data”.

Conversely, he said there is also an opportunity for the wholesale distribution customers that are a natural fit for Corvus over time to have access to an array of other insurance products by Travelers.

“That may be the longer-term vision, but ultimately we'd love it if a customer that bought a smart cyber policy from Corvus bought something else from Travelers over time,” he said. “And the more we can leverage those relationships, the better.”