Market Presence
The St. Paul has set its sights high in a rapidly consolidating insurance marketplace. Our vision statement points out that we "will be a premier worldwide provider of insurance products and services in strategically selected markets." That vision requires market presence, something we have increasingly pursued in recent years.
Our 1998 merger with USF&G Corporation was the most important step thus far in our quest for the economies of scale and market presence necessary to be a major player in today's property-liability insurance market. The post-merger St. Paul has significantly expanded the scope of its operation compared with the premerger St. Paul.
Over the last five years, we more than doubled our revenues. During the same period, a number of our peer companies faltered or failed to achieve market presence.
With the merger, we rose from the 13th-largest U.S. property-liability insurance company to the eighth-largest. St. Paul Re moved up from its ranking as the 17th-largest reinsurer in the world to 14th-largest. The merged companies complement each other's operations and bring successful new products and services to the table, filling in the gaps each company had on its own.
For example, The St. Paul's Commercial Lines operation, serving midsize businesses, was strong in the North and Midwest, while USF&G's was dominant in the South and East. With the merger, "middle market" premiums rose 80 percent. USF&G brought a significant underwriting platform for small businesses to The St. Paul. The St. Paul's Personal Insurance operation increased its premiums by 50 percent and its geographic spread from 28 to 35 states, putting it among the top 10 U.S. independent agency personal insurance underwriters.
Among The St. Paul's specialty underwriting operations, the merger more than doubled St. Paul Surety's premiums, making The St. Paul the largest surety underwriter in the United States. The already strong Technology operation's premiums increased by 25 percent, and the merger brought additional expertise in the development of products and services for emerging technology markets. The St. Paul is the second-largest technology underwriter in the United States.
Our Public Sector operation, providing insurance for cities, states and other public entities, more than doubled its premiums, making us one of the top underwriters in this specialty area.
USF&G brought additional business in areas where The St. Paul was already a market leader: Financial and Professional Services (we are the No. 1 underwriter of community banks in the United States); in Ocean Marine; and in Excess and Surplus Lines.
Our operation serving the health care industry continues its 60-year tradition as a market leader, licensed in all states and providing state-of-the-art underwriting, loss control and claim services.
New to The St. Paul is the nonstandard auto business, a very successful underwriting specialty of USF&G.
Critical to The St. Paul's future success will be its market presence internationally. St. Paul International continues to grow, with longstanding operations in the United Kingdom, Spain and Canada. Since 1996, The St. Paul has opened offices in South Africa, France, Germany, The Netherlands, Argentina, Mexico and Ireland and acquired operations in Botswana. And St. Paul International's agency group now manages eight Lloyd's syndicates, representing approximately 4 percent of Lloyd's business..
