White Mountains Insurance Group, Ltd. (White Mountains) engages in the business of making opportunistic and value-oriented acquisitions of businesses and assets in the insurance, financial services and related sectors.
As of December 31, 2024, White Mountains conducted its business primarily in five areas: property and casualty insurance and reinsurance, municipal bond reinsurance, capital solutions for asset and wealth management firms, property and casualty insurance distribution and other op...
White Mountains Insurance Group, Ltd. (White Mountains) engages in the business of making opportunistic and value-oriented acquisitions of businesses and assets in the insurance, financial services and related sectors.
As of December 31, 2024, White Mountains conducted its business primarily in five areas: property and casualty insurance and reinsurance, municipal bond reinsurance, capital solutions for asset and wealth management firms, property and casualty insurance distribution and other operations.
White Mountains’s property and casualty insurance and reinsurance business is conducted through its subsidiary Ark Insurance Holdings Limited and its subsidiaries (collectively, Ark) and Outrigger Re Ltd. Segregated Account 2023-1 (WM Outrigger Re) (collectively with Ark, Ark/WM Outrigger). White Mountains’s municipal bond reinsurance business is conducted through its subsidiary HG Global Ltd. and its reinsurance subsidiary HG Re Ltd. (HG Re) (collectively with HG Re, HG Global). White Mountains provides capital solutions for asset and wealth management firms through its subsidiary Kudu Investment Management, LLC and its subsidiaries (collectively, Kudu). White Mountains’s property and casualty insurance distribution business is conducted through its subsidiary PM Holdings LLC (Bamboo Holdings) and its subsidiaries Bamboo Ide8 Insurance Services LLC (Bamboo MGA) and Ide8 Re Inc. (Bamboo Captive) (collectively with Bamboo Holdings and Bamboo MGA, Bamboo). White Mountains’s other operations consist of the company and its wholly-owned subsidiary, White Mountains Capital, LLC (WM Capital), its other intermediate holding companies, its wholly-owned investment management subsidiary, White Mountains Advisors LLC (WM Advisors), investment assets managed by WM Advisors, its interests in MediaAlpha, Inc. (MediaAlpha), DavidShield PassportCard Ltd. and its subsidiaries (collectively, PassportCard/DavidShield), Elementum Holdings LP (Elementum), White Mountains Partners LLC (WTM Partners), a Bermuda special purpose collateralized reinsurance vehicle that provides reinsurance capacity to Bamboo (Bamboo CRV), certain other consolidated and unconsolidated entities (Other Operating Businesses) and certain other assets (collectively, Other Operations).
As of December 31, 2024, White Mountains’s reportable segments were Ark/WM Outrigger, HG Global, Kudu and Bamboo with its remaining operating businesses, holding companies and other assets included in Other Operations.
Ark/WM Outrigger segment
The Ark/WM Outrigger segment consists of Ark Insurance Holdings Limited and its subsidiaries (collectively, ‘Ark’) and Outrigger Re Ltd. Segregated Account 2023-1 (‘WM Outrigger Re’) (collectively with Ark, ‘Ark/WM Outrigger’).
On January 1, 2021, White Mountains acquired a controlling ownership interest in Ark (the ‘Ark Transaction’). Ark is a specialty property and casualty insurance and reinsurance company that offers a wide range of niche insurance and reinsurance products, including property, specialty, marine & energy, casualty and accident & health.
During the fourth quarter of 2022, Ark sponsored the formation of Outrigger Re Ltd., a Bermuda company registered as a special purpose insurer and segregated accounts company, to provide collateralized reinsurance protection on Ark’s Bermuda global property catastrophe excess of loss portfolio written in the 2023 underwriting year. Ark renewed its quota share reinsurance agreement with Outrigger Re Ltd. for the 2024 and 2025 underwriting years.
Ark
Ark is a specialty property and casualty insurance and reinsurance company that offers a wide range of niche insurance and reinsurance products. Ark underwrites select coverages through its two major subsidiaries in the United Kingdom and Bermuda.
In the United Kingdom, Ark participates in the Lloyd’s of London (Lloyd’s) market through Ark Corporate Member Limited (ACML), Ark’s wholly owned Lloyd’s corporate member, which in turn provides underwriting capacity to Lloyd’s Syndicates 4020 and 3902 and Additional Central Settlement Number (ACSN) 3832 (collectively, the Syndicates). ACSN 3832 writes business on behalf of Syndicate 4020. Ark Syndicate Management Limited (ASML), Ark’s wholly owned Lloyd’s managing agent, oversees the underwriting of the Syndicates. The Syndicates underwrite a diversified portfolio of insurance and reinsurance, including property, specialty, marine & energy, casualty and accident & health. Syndicate 4020 commenced underwriting on April 1, 2007, Syndicate 3902 on January 1, 2017, and ACSN 3832 on July 1, 2024.
For the years of account prior to the Ark Transaction, a significant proportion of the Syndicates’ underwriting capital was provided by third-party insurance and reinsurance groups (‘TPC Providers’) using whole account reinsurance contracts with Ark’s corporate member. For the years of account subsequent to the Ark Transaction, Ark is no longer using TPC Providers to provide underwriting capital for the Syndicates.
WM Outrigger Re
During the fourth quarter of 2022, Ark sponsored the formation of Outrigger Re Ltd., a Bermuda company registered as a special purpose insurer and segregated accounts company, to provide reinsurance capacity to Ark.
During the fourth quarter of 2023, Ark renewed Outrigger Re Ltd. for the 2024 underwriting year. The remaining capital was provided by third-party investors.
During the fourth quarter of 2024, Ark renewed Outrigger Re Ltd. for the 2025 underwriting year with. The reduced capacity at Outrigger Re Ltd. was replaced by Ark through traditional quota share reinsurance agreements.
Lines of Business
Ark writes specialized lines of insurance and reinsurance across its United Kingdom and Bermuda platforms within five major lines of business: property, specialty, marine & energy, casualty and accident & health. Claims for property, specialty, marine & energy and accident & health coverages are typically reported and settled in a relatively short period of time. Casualty insurance (often referred to as liability insurance) generally covers the financial consequences of a legal liability of an individual or an organization resulting from negligent acts or omissions causing bodily injury, property damages and/or economic damages to a third-party. Settlements for casualty/liability coverages can extend for long periods of time as claims are often reported and ultimately paid or settled years after the related loss events occur.
Ark has recently added, and expects to continue to add, new business to its portfolio, as it focuses on profitable business opportunities while carefully managing underwriting risk. Ark also leads certain Lloyd’s market consortia, including two that target renewable energy clients including wind farms, solar plants, hydroelectric plants, geothermal plants and wave and tidal projects.
Property
Ark’s property business is underwritten on both an insurance and reinsurance basis covering the financial consequences of accidental losses to an insured’s property, such as a business’s building, inventory and equipment, or personal property. Coverages provided include all risks of direct physical loss or damage, business interruption and natural and non-natural catastrophe perils. Ark’s property insurance business consists primarily of direct and facultative contracts, line slips and MGA binding authorities. Ark’s property insurance business is underwritten on a worldwide basis with a focus on excess & surplus lines in the United States and on large international accounts. Ark’s property reinsurance business consists primarily of treaty reinsurance underwritten on a catastrophe excess of loss, per risk excess and proportional basis. Ark’s property reinsurance business is underwritten on a worldwide basis with particular focus on risks in the United States, Europe and Asia.
Specialty
Ark’s specialty business is underwritten on both an insurance and reinsurance basis covering a range of individual risks and treaties primarily including aviation, space, political and credit, cyber, terrorism and political violence, nuclear, fine art & specie, surety and mortgage. Ark’s specialty insurance and reinsurance business is underwritten on a worldwide basis.
Aviation
Aviation insurance primarily covers airlines and general aviation for loss of, or damage to, aircraft hull and ensuing passenger and third-party liability. Perils include war and war-like actions such as terrorism. Additionally, liability arising out of non-aircraft operations such as hangars and airports may be covered.
Space
Space insurance primarily covers loss of, or damage to, satellites during launch and in orbit, including faulty design that leads to early loss of operating life. Ark’s space insurance is primarily written through binders supporting specialized, technical MGAs.
Political and Credit
Political and credit insurance primarily covers risks relating to the confiscation, expropriation, nationalization and deprivation of insured assets due to war, political or government action as well as contract frustration and non-payment by obligors.
Cyber
Cyber insurance primarily covers the physical damage and liabilities arising from cyber-attacks, including coverage for ransomware, loss of data and third-party liabilities.
Terrorism and Political Violence
Terrorism and political violence insurance primarily covers physical loss or damage and threat thereof, including ensuing loss through business interruption, caused by declared terror events, political violence and war and war-like actions in developed and developing countries around the world.
Nuclear
Nuclear insurance covers country specific nuclear pools and companies and institutions with nuclear exposure excluded from standard property and casualty policies for coverage of physical damage and third-party liability.
Fine Art & Specie
Fine art & specie insurance primarily covers loss to fine art, specie, cash in transit and vault and jewelers’ block risks as a result of theft or damage in transit or at exhibition.
Surety
Surety insurance covers financial guarantee risks between a bond issuer, principal and obligee designed to address responsibility for debt payments, default or other financial obligations. Ark underwrites this portfolio on a reinsurance basis, primarily excess of loss, for U.S.-domiciled clients. The underlying assureds cover a variety of industries including construction, oil & gas, hotel & leisure and transportation projects.
Mortgage
Mortgage insurance covers financial guarantee and credit risks between a lending institution and a borrower designed to address responsibility for debt payments and default. Ark underwrites a reinsurance portfolio supporting government-sponsored enterprises (Fannie Mae and Freddie Mac) and private mortgage insurers on both a proportional and excess of loss basis.
Marine & Energy
Ark’s marine & energy business is underwritten on both an insurance and reinsurance basis primarily covering marine hull, cargo, specie, marine & energy liabilities and upstream energy platform physical damage and liability. Marine hull consists primarily of coastal and ocean-going vessels and covers worldwide risks on an all perils or total loss only basis together with lighter craft, including yachts. Cargo consists of worldwide transits and moveable goods with a particular emphasis on bulk cargo, project cargo and pre-launch satellite risks. Specie is the transit and storage of high value goods, including semi-precious and precious metals. Marine & energy liabilities consist of liability risks arising from doing business in their respective industries including liabilities arising from pollution and damage covered by protection and indemnity clubs, including for example the International Group of Protection & Indemnity Clubs. Upstream energy platform physical damage and liability covers a variety of oil and gas industry construction, exploration and production risks.
Ark’s marine & energy insurance business consists of direct and facultative risks written primarily in the open market, as well as through line slips and MGA binding authorities. Ark’s marine & energy reinsurance business consists of treaty reinsurance underwritten on both a proportional and excess of loss basis. Ark’s marine & energy insurance and reinsurance business is underwritten on a worldwide basis.
Casualty
Ark’s casualty business is underwritten on an insurance and reinsurance basis primarily covering medical malpractice, professional liability and general liability. Ark’s casualty insurance business is generally written on an excess of loss and primary basis arising from operations of a wide range of predominantly large U.S. companies with global operations, including energy companies, lawyers, accountants, consultants and construction firms. Ark’s casualty reinsurance business is underwritten on an excess of loss and proportional treaty basis.
Accident & Health
Ark’s accident & health business is underwritten on both an insurance and reinsurance basis covering a wide range of personal accident, sickness, disability, travel, short-term life, health and medical insurance and reinsurance risks. Ark’s accident & health insurance and reinsurance business consists of direct and facultative contracts written under the binding authority of external MGAs and through Accident & Health Underwriting Limited (AHU), Ark’s wholly-owned MGA domiciled in the United Kingdom. Ark’s accident & health insurance and reinsurance business is underwritten on a worldwide basis.
Marketing and Distribution
Ark offers its products and services through a network of brokers, MGAs and reinsurance intermediaries (collectively, ‘insurance and reinsurance intermediaries’). In the United Kingdom, Ark operates through the Syndicates with Lloyd’s approved brokers and MGAs. In Bermuda, Ark primarily derives its reinsurance business through reinsurance intermediaries that represent the ceding company and its insurance business through brokers based in Bermuda and London. Ark pays acquisition costs to brokers, MGAs and reinsurance intermediaries as compensation for facilitating the flow and processing of business, typically on industry standard percentages of premium underwritten. In addition, Ark pays certain MGAs profit commissions based on the underwriting profit of the business they produce.
Competition
Ark competes with insurance and reinsurance companies who operate in the Bermuda and Lloyd’s markets such as:
Bermuda insurance and reinsurance market: American International Group, Inc., Arch Capital Group Ltd., Aspen Insurance Holdings Ltd., AXIS Capital Holdings Ltd., Chubb Ltd., Everest Re Group, Markel Group, Inc., RenaissanceRe Holdings Ltd., SiriusPoint Ltd. and others; and
Lloyd’s market: Beazley plc, Hiscox plc, Lancashire Holdings Ltd., MS Amlin Ltd. and other syndicates.
HG Global segment
The HG Global segment consists of HG Global and, prior to its deconsolidation on July 1, 2024, the consolidated results of Build America Mutual Assurance Company (BAM).
Reinsurance Treaties
HG Global provides reinsurance exclusively to BAM. Through the reinsurance relationship with BAM, HG Global maintains a direct dialogue and line of sight into key operations, including the application of both BAM’s underwriting guidelines and the FLRT underwriting guidelines, continuous portfolio monitoring, credit surveillance and claims paying resources.
FLRT
Under the FLRT, HG Re provides first-loss reinsurance protection of up to 15%-of-par outstanding for each policy assumed from BAM.
XOLT
HG Re is also party to an excess of loss reinsurance agreement (the XOLT) with BAM. Under the XOLT, HG Re provides last-dollar protection for exposures on municipal bonds insured by BAM in excess of the NYDFS single issuer limits.
Collateral Trusts
HG Re’s obligations under the FLRT are subject to an aggregate limit equal to the assets in two collateral trusts, the Supplemental Trust and the Regulation 114 Trust (together, the Collateral Trusts), at any point in time.
Competition
BAM’s primary competitor is Assured Guaranty Ltd. (Assured).
Insured Portfolio
Under the FLRT, HG Re provides first-loss reinsurance protection of up to 15%-of-par outstanding for each policy assumed from BAM. For capital appreciation bonds, par is adjusted to the estimated equivalent par value for current interest paying bonds.
KUDU segment
Kudu provides capital solutions for boutique asset and wealth managers for a variety of purposes including generational ownership transfers, management buyouts, acquisition and growth finance and legacy partner liquidity. Kudu also provides strategic assistance to investees from time to time. Kudu’s capital solutions generally are structured as noncontrolling equity interests in the form of revenue and earnings participation contracts (‘Participation Contracts’) and designed to generate immediate cash yields.
Portfolio
As of December 31, 2024, Kudu had deployed into 27 asset and wealth management firms globally, including three that has exited the portfolio. As of December 31, 2024, Kudu’s asset and wealth management firms had combined assets under management of approximately $125 billion, spanning a range of asset classes including real estate, wealth management, hedge funds, private equity and alternative credit strategies.
Kudu seeks to diversify geographically. Its portfolio includes 19 firms headquartered in 11 different states in the United States, three in the United Kingdom, two in Australia and one in Canada.
BAMBOO segment
The Bamboo segment consists of Bamboo Holdings, Bamboo MGA and Bamboo Captive. On January 2, 2024, White Mountains acquired a controlling interest in Bamboo (the Bamboo Transaction).
Marketing and Distribution
Bamboo is an MGA and program administrator with delegated binding authorities, and as such, is generally dependent on its Capacity Providers to bear the insurance risk on the programs designed and underwritten by Bamboo. Bamboo currently relies on a small group of Capacity Providers for a large proportion of its business.
For the year ended December 31, 2024, the insurance risk for Bamboo’s programs was supported by over fifteen third-party Capacity Providers, with the top two of these providers representing approximately 28% of Bamboo’s managed premiums.
Bamboo primarily relies on third-party agents and brokers as its sales channel. Substantially all of Bamboo’s products are distributed through third-party agents and brokers who have the principal relationships with policyholders. Agents and brokers generally own the renewal rights, and thus Bamboo’s business model is dependent on its relationships with, and the success of, the agents and brokers with whom Bamboo does business.
Other Operations
White Mountains’s Other Operations consists of the company and its wholly-owned subsidiary, WM Capital, its other intermediate holding companies, its wholly-owned investment management subsidiary, WM Advisors, investment assets managed by WM Advisors, its interests in MediaAlpha, PassportCard/DavidShield, Elementum, WTM Partners, Bamboo CRV, Other Operating Businesses and certain other assets.
WM Advisors
As of December 31, 2024, WM Advisors managed and/or provided oversight and administration for substantially all of White Mountains’s fixed maturity investments, short-term investments, common equity securities and other long-term investments.
MediaAlpha
MediaAlpha is a marketing technology company. It operates a transparent and efficient customer acquisition technology platform that facilitates real-time transactions between buyers and sellers of consumer referrals (i.e., clicks, calls and leads), primarily in the property & casualty, health and life insurance verticals. MediaAlpha generates revenue by earning a fee for each consumer referral sold on its platform. A transaction becomes payable only on a qualifying consumer action, and is not contingent on the sale of a product to the consumer.
PassportCard/DavidShield
PassportCard/DavidShield is principally an MGA that provides two insurance products: leisure travel insurance and expatriate medical insurance. PassportCard/DavidShield delivers a real-time, paperless insurance solution that facilitates claims payouts in minutes, wherever customers need them around the world. PassportCard/DavidShield offers its products to both individuals and organizations, primarily in Israel (its home market) as well as the European Union and Australia. PassportCard/DavidShield, through its wholly-owned carrier, writes both leisure travel and expatriate medical insurance in Israel and cedes 100% of the underwriting risks to its reinsurance partners.
PassportCard Limited (PassportCard) is a U.K.-domiciled global MGA. PassportCard receives commissions for placing policies with its insurance carrier partners and licensing fees for use of its card-based technology. PassportCard distributes its products through the broker channel and on a direct-to-consumer basis and also franchises its solutions in certain markets to major travel insurance and medical assistance companies.
DavidShield Life Insurance Agency (2000) Ltd. (DavidShield) is an MGA that is the leading provider of expatriate medical insurance in Israel. Since 2000, DavidShield has delivered industry-leading medical insurance solutions to diplomats, non-governmental organizations and thousands of multinational corporations and individuals in over 95 countries. DavidShield receives structured commissions for placing policies with its insurance carrier partners and licensing fees for use of its card-based technology.
There are a number of distinct advantages to the PassportCard/DavidShield insurance solutions that differentiate them in the marketplace. Through its real-time claims handling process, PassportCard/DavidShield is generally able to control claims, loss costs and fraud upfront, driving lower than industry average loss ratios for their reinsurance partners. Further, the card-based, paperless delivery model enables a superior customer experience, commanding industry-leading customer retention rates and strong brand loyalty.
As of December 31, 2024, White Mountains owned 53.8% of PassportCard/DavidShield.
Elementum
Elementum is a third-party registered investment adviser specializing in natural catastrophe insurance-linked securities (‘ILS’). Elementum manages separate accounts and pooled investment vehicles across various ILS sectors, including catastrophe bonds, collateralized reinsurance investments and industry loss warranties on behalf of third-party clients.
White Mountains has a noncontrolling equity interest in Elementum, which is accounted for at fair value within other long-term investments. As of December 31, 2024, White Mountains had a 26.6% limited partnership interest in Elementum.
White Mountains also has investments in ILS funds managed by Elementum.
WTM Partners
In October 2023, White Mountains announced the launch of WTM Partners, which will acquire businesses in non-insurance, non-financial services sectors including essential services, light industrial and specialty consumer.
Bamboo CRV
Bamboo CRV is a Bermuda special purpose collateralized reinsurance vehicle that provides reinsurance capacity to Bamboo. Bamboo CRV entered into a collateralized quota share agreement with one of Bamboo’s fronting partners to provide reinsurance protection on Bamboo’s admitted and non-admitted business written in the 2024 treaty year.
Other Operating Businesses
White Mountains has controlling equity interests in various other operating businesses, which are consolidated.
White Mountains also has noncontrolling equity interests in various other operating businesses, which are generally accounted for at fair value within other long-term investments.
Investments
White Mountains maintains a fixed income portfolio that consists primarily of high-quality, short-duration, fixed maturity investments and short-term investments. White Mountains invests in fixed maturity investments that are attractively priced in relation to their investment risks and actively manages the average duration of the fixed income portfolio. As of December 31, 2024, the fixed income portfolio duration, including short-term investments, was 1.9 years. White Mountains has established relationships with select third-party registered investment advisers to manage a portion of its fixed income portfolio.
White Mountains maintains an equity portfolio that consists of common equity securities, its investment in MediaAlpha and other long-term investments. As of December 31, 2024, White Mountains’s portfolio of common equity securities consist of international listed equity funds and passive exchange traded funds (ETFs). White Mountains’s other long-term investments consist primarily of unconsolidated entities, Kudu’s Participation Contracts, private equity funds and hedge funds, a bank loan fund, Lloyd’s trust deposits, ILS funds and private debt instruments.
Regulation
United States
Bamboo Captive is a protected cell captive domiciled in the state of Arizona and is subject to regulation and supervision by the Arizona Department of Insurance and Financial Institutions (Arizona DIFI).
Kudu Investment Holdings, LLC, a subsidiary of Kudu, is an investment adviser that is registered with the SEC under Section 203 of the United States Investment Advisers Act of 1940.
Bermuda
The Insurance Act 1978 of Bermuda and related regulations, as amended (the Insurance Act), regulates the insurance business of HG Re, a special purpose insurer, GAIL, Ark’s wholly-owned Class 4 insurance and reinsurance company and Outrigger Re Ltd., a special purpose insurer. Outrigger Re Ltd. is also registered as a segregated accounts company under the Bermuda Segregated Accounts Companies Act 2000, as amended (the SAC Act). The Insurance Act provides that no person may carry on any insurance business in or from within Bermuda unless registered as an insurer under the Insurance Act by the Bermuda Monetary Authority (BMA).
GAIL is registered as a Class 4 insurer. Class 4 insurers carry on general insurance business including excess liability business or property catastrophe, marine & energy, casualty and specialty reinsurance business. As a Class 4 insurer, GAIL must maintain available capital in accordance with a ‘three-tiered capital system’ to enable the BMA to better assess the quality of an insurer’s capital resources.
All Bermuda insurers are required to comply with the BMA’s Insurance Code of Conduct, which establishes duties, requirements and standards to be complied with to ensure each insurer implements sound corporate governance, risk management and internal controls.
The company is an exempted company registered under the companies Act. As a result, the company is required to comply with the provisions of the companies Act regulating the payment of dividends and making of distributions from contributed surplus.
The Economic Substance Act 2018, as amended (ESA) impacts every Bermuda registered entity engaged in a relevant activity, requiring impacted entities to maintain a substantial economic presence in Bermuda and to satisfy economic substance requirements.
United Kingdom
As an insurer in the United Kingdom, Ark is dual-regulated by the Financial Conduct Authority (the ‘FCA’) and the Prudential Regulation Authority (the ‘PRA’) (collectively, the ‘U.K. Regulators’). The PRA currently has ultimate responsibility for the prudential supervision of financial services in the U.K. The FCA has responsibility for market conduct regulation. The U.K. Regulators regulate insurers, insurance intermediaries and Lloyd’s. Both the PRA and FCA have substantial powers of intervention in relation to regulated firms.
Lloyd’s as a whole is authorized by the PRA and regulated by both the FCA and the PRA. Lloyd’s is required to implement certain rules prescribed by the PRA and by the FCA; such rules are to be implemented by Lloyd’s pursuant to its powers under the Lloyd’s Act 1982 relating to the operation of the Lloyd’s market. Lloyd’s prescribes, in respect of its managing agents and corporate and individual members (‘Members’), certain minimum standards relating to their management and control, solvency and various other requirements.
The operations of ASML, Ark’s wholly owned Lloyd’s managing agent, are subject to oversight by Lloyd’s, through the Lloyd’s Council. By entering into a membership agreement with Lloyd’s, ACML has undertaken to comply with all Lloyd’s bye-laws and regulations as well as the provisions of the Lloyd’s Acts and the Financial Services and Markets Act 2000, as amended by the Financial Services Act 2012.
Lloyd’s Insurance Company is authorized and regulated by the National Bank of Belgium and regulated by the Financial Services and Markets Authority.
The company is subject to various state, federal and international laws and regulations that address the collection, storing, use, disclosure, security, privacy, transfer and other processing of personal information and other data, including the Securities and Exchange Commission (SEC) rules, the EU General Data Privacy Regulation (GDPR), the California Consumer Privacy Act and the California Privacy Rights Act, among others.
History
White Mountains Insurance Group, Ltd. was incorporated in 1980.
