Cyber Insurance White-Labeling: How it Works

White-Label Insurance Cyber Insurance

All Tags

White-Label Insurance Cyber Insurance

By The Boost Team on May 5, 2023

7 min read

A stylized image of a digital shield representing cyber protection.

For both cybersecurity service providers and insurtechs that focus on commercial clients, adding a cyber insurance product can build significant recurring revenue for your business, and deepen your relationships with your current customers.

Creating a new insurance product, however, is much more complex than a new piece of software or a physical gadget. Building an insurance program from scratch is a yearslong endeavor that requires a significant amount of capital and specialized expertise. A much faster path to market is to white-label an existing cyber insurance product, and offer it to your customers.

In this article we’ll go over the process of getting to market with a white-label cyber insurance product, and the advantages of this route vs. building a new product yourself.

What is White-Labeling for Cyber Insurance?

A white-labeled product is produced by a particular company, then sold by other companies under their own brand. This is common with physical goods, particularly products sold as part of a certain store’s brand.

For example, Costco offers a broad variety of goods under their Kirkland Signature label, ranging from jeans to potato chips. However, Costco doesn’t own and operate the factories and logistics chains necessary for producing hundreds of diverse items. Instead, they source products from other businesses that do manufacture those goods, and then sell them in-store under the Kirkland Signature branding.

The same principle applies to white-label insurance. Insurance-as-a-service providers such as Boost have already invested the time and resources to build new insurance products, which other businesses can then offer under their own branding. This allows businesses to get to market with a new insurance offering at a much lower time and cost requirement than would be required to build a new product themselves.

Getting to Market with White-Label Cyber Insurance

Once your company decides to offer white-labeled cyber insurance, there are a few steps to go through in order to get to market.

1) Select a partner

The first step is choosing the insurance provider whose products you want to white-label. This could be an insurance-as-a-service provider like Boost, or possibly a traditional insurer.

When selecting a partner, make sure to ask about two things: what they allow for white-labeling, and whether the product can be customized. Some insurers allow for their products to be resold, but not re-branded; others offer products as-is and don’t allow changing things like the coverage configurations. Be sure that your partner can deliver on what your business needs (and expects).

2) Choose the coverages to offer your customers

You know your customers best - what they need, and what they don’t. Assuming your partner allows customization, the second step is to configure your cyber insurance product so that it’s right for your audience.

There may be some coverages that are particularly important to your customers, and others that aren’t relevant to their particular business needs. In general, the more an insurance product covers, the more expensive it is. You can ensure the best value for your customers by building an insurance package that includes all the protections that they need from cyber insurance, with nothing that they don’t.

3) Get licensed to sell insurance (if you aren’t already)

If your business is an insurtech, you’ve already got this covered. If your company is new to insurance, however, you’ll need to get an insurance license to gain the full benefits of offering cyber insurance.

There are multiple types of insurance licenses, and the exact requirements vary from state to state. Since insurance in the U.S. is regulated at the state level, you’ll also need a license from each state you intend to sell insurance in. However, this is less difficult than it sounds. With support from a good partner, the process can be very straightforward and relatively painless.

4) Connect to your partner’s system

After you’ve settled on a partner and product, you’ll need to connect your partner’s system to your digital experience to offer the product to your customer. When you work with Boost, this means leveraging our API to build an integration between your website or app and Boost’s policy administration system.

If you’re not familiar, a policy administration system (PAS) is the system of record for every transaction related to an insurance policy. For digital insurance, the PAS is the technological underpinning that allows customers to buy and manage their policies online. Different PAS have different capabilities, and some are better able to support digital insurance workflows than others. This is another area where it pays to get detailed with your partner, so there are no surprises when it comes time to deploy.

5) Start offering insurance to your customers

Once the integration is complete, you’re ready to start connecting your customers with cyber insurance. Your customers’ purchase experience can vary depending on your partner’s capabilities and business policies.

Here’s how it works with Boost: your customers will be able to buy your white-labeled cyber insurance directly from your existing website or app, under your own brand. The customer can manage every part of their policy lifecycle digitally, from quote to purchase to modifications, with no offline manual processes. The cyber insurance product will be branded as your company’s product, all the way down to the logo on the policy documents.

Advantages of Offering White-Label Cyber Insurance

There are several upsides to offering a white-labeled cyber insurance product instead of building an entirely new cyber product just for your business to sell. The benefits include lower costs, faster time to market, and easier, more scalable operations.

Lower Cost

Building a new insurance program requires significant financial investment, particularly when it comes to expertise. Insurance is complex, and successfully creating a new product requires actuaries, underwriters, insurance regulatory attorneys, and more. Then there’s the tech side - if you want to offer your product digitally, you’ll need a PAS capable of supporting all of the necessary insurance operations. This means considerable development work, even starting with an “off the shelf” PAS.

All in all, the costs of building a new insurance program from scratch typically run into the millions of dollars. White-label products have already gone through the development process, and are ready to sell digitally. While there are still development costs required to connect your partner’s PAS to your digital experience, those expenses are usually a fraction of what it would cost to create an entirely new cyber product and the digital infrastructure to sell it.

Faster Time to Market

While exact timing can vary, it’s safe to expect a timeline of at least three years between starting the process of creating a new insurance product, and being able to sell your first policy. There are many steps involved in building an insurance program from scratch, and some of them - like convincing a carrier to back your product - can be very difficult to accomplish for new entrants to the insurance market.

Since white-label cyber insurance products are already built and ready to sell, the go-to-market timeline for offering these products is dramatically shorter. You’ll just need to sign with your partner and then build the necessary integrations, a timeline of weeks or months instead of years.

Built-in Scalability

Insurance programs are constrained by their capacity - the maximum amount of value a program can insure, as determined by the total amount of capital available to cover its losses. Once a program has sold as many policies as its capacity can support, it can’t sell any more until more capacity becomes available.

Acquiring more capacity for an insurance program requires complex negotiations with licensed insurance or reinsurance carriers, which can take a long time. With white-label cyber insurance products, your partner will have already secured the capacity needed to sell your product, and built a network of relationships with capacity providers to ensure their programs can continue to scale.

Streamlined Operations

Launching your insurance offering is only the beginning. The program will need to be managed on an ongoing basis. This includes responsibilities like ensuring that it remains compliant with all relevant state regulations, maintaining and continuing development of the technology required to sell digital insurance, and managing claims from your customers (which are legally required to be handled by licensed professionals).

Building your own cyber insurance product means that you’re responsible for these ongoing operational needs, and you’ll need to hire in-house resources to manage these them. If you choose to white-label, however, then your partner will be the one to manage these ongoing program requirements. This represents significant opex savings, and allows non-insurance companies to avoid a costly distraction from their core value and offerings.

Cyber insurance is a big revenue opportunity for insurtechs and cybersecurity companies alike. White-label cyber insurance allows businesses to tap into that opportunity, with significantly lower barriers-to-entry than building a whole new cyber insurance product themselves.

Thinking about adding cyber insurance to your offerings? Our free ebook has everything you need to know. Download The Comprehensive Guide to Offering SMB Cyber Insurance today, or get in touch with our experts to learn more.

Explore Popular Categories

Boost News Insurance 101 Insurance Infrastructure New Product Development White-Label Insurance

Share this Article

Ready for Liftoff: BHMS Backs Boost

Jul 31, 2024

Friends of Boost, Today Boost is thrilled to announce that we have secured a significant equity investment from BHMS Investments, setting the stage for an incredibly exciting next phase for this company and the amazing team that has built it brick-by-brick over the past seven years. With a rock-solid foundation firmly in place, this partnership is going to supercharge our growth, fuel more innovation, and cement Boost’s position as the go-to infrastructure platform in insurance. We are on a mission to empower MGAs, insurtechs, independent brokers and agents, wholesalers, embedded insurance providers, and really any company that just wants to build, transact, and operate more efficiently in this technology-enabled world of ours. While capital is great, today is about hard-earned validation for our team doing that the right way since Day 1. BHMS is the perfect capital partner for Boost in terms of their insurance expertise and unquestionable track record in the space, but more importantly, they are fantastic people that share both our views on the industry and our principles of company building. The market is dangerously fixed for early and growth stage companies right now (and I say “fixed” intentionally). It’s incredibly easy to get picked off in an environment like that, so it takes a rare mix of both intellect and character to do the right thing when you’re on the capital side of that equation - and even more to be truly value-add to your portfolio companies. BHMS has that mix in spades and appreciated Boost for what it is, what it has accomplished, and what remains an incredibly high ceiling for this company vs. playing short-term charades with the herd. That’s our kind of investor. This investment isn’t just about the money—it's a resounding endorsement of Boost’s strength, credibility, and potential to make a truly meaningful impact on the insurance industry at scale. With BHMS now on board, alongside an incredible group of long-time strategic backers like Markel, RenaissanceRe, and Canopius, we’re ready to take our game to the next level. Our mission has always been to disrupt the insurance space with cutting-edge tech and unparalleled service, and this backing proves that disrupting responsibly is the only approach that works in our industry. Anyone can grow fast if they don’t care about quality or long-term credibility. At Boost, we underwrite profitably, we respect compliance, and we always - always - take a collaborative approach with our stakeholders across the entire value chain. As someone with literally zero patience, I can personally attest to that being incredibly difficult to do at times - but it scales. Even with the market’s ups and downs, Boost has been a powerhouse of innovation in the insurtech landscape with equal commitment to disruption and reliability. Doing things the right way does not mean you cannot innovate - or even disrupt - and leveraging best-in-class technology is not a right reserved for #insurtechs. Our platform has always been a one-stop shop for insurtechs and embedded insurance providers and MGAs, independent agents and brokers, and wholesalers alike - offering everything from product development to underwriting and program management to claims administration and reinsurance capacity. With our proprietary tech and a dream team of industry pros, we’re delivering smarter, more efficient solutions than ever before. Since our first program launched in 2019, we’ve underwritten over $200 billion in coverage, which is a somewhat staggering figure in hindsight. Today we’re proud to support programs for giants like Amwins along with trailblazers like Cowbell, Newfront, and Wagmo, and we’re grateful for all of the companies that chose to build with Boost even when Boost itself was just getting started. Our steady, disciplined approach has kept our portfolio profitable and we like to think that has kept our partners in front of us very happy as well. All of Boost’s success is thanks to what is hands down the best team in the industry. Hard stop. Their grit, dedication, and willingness to tackle tough challenges head-on has been crucial. Boost’s commitment to quality starts with our team and is reflected in them every single day. We keep things lean at Boost because that quality always outperforms quantity. Even if that approach always requires more from each individual and makes the stakes a bit higher, working with the right people makes the returns on each long hour invested that much more gratifying. Few people exemplify those principles or have demonstrated such an unwavering commitment to Boost more than Jeremy Deitch, so I am also thrilled to announce that Jeremy has been promoted to President at Boost and will join me on our Board of Directors. Jeremy’s leadership has been critical since the day he started at Boost almost 6 years ago, following probably the most grueling interview process in our company’s history - one he is always happy to dramatize even more if you ever ask him. ;) I couldn’t be more grateful to have a partner like him as Boost soars to new heights. With this new investment, we’re geared up to boost (pun intended) our growth and expand our tech offerings. We’re planning to scale our MGA programs, roll out new products, and snap up some strategic acquisitions. Our goal? To make building a business in insurance easier, faster, and more efficient for everyone so they can better serve their customers. We’re more fired up than ever about our mission to empower insurance providers with the tech and infrastructure they need to thrive. This partnership with BHMS is just the beginning. The future is bright, and we’re ready to lead the charge. Thank you to everyone who has been part of our journey thus far. Let's all keep pushing boundaries together - because the best is yet to come. Special thanks to the team at Howden Capital Markets & Advisory for helping Boost always say what it’ll do and do what it says. You can find our full press release here and, more importantly, can start joining our platform here. All my best, Alex Maffeo CEO & Founder Boost Insurance

Two business people work on a laptop in an office conference room.

What is a Cell Captive?

May 23, 2024

A captive is an insurance entity that a business creates, rents, or owns in order to self-insure risks. A cell captive, sometimes also called a protected cell captive or segregated cell captive, is a specific insurance captive structure that allows an entity to segment or separate business in one cell from that in another cell, so that a particular cell’s assets and liabilities are insulated from anything that happens in another cell (even if both cells are part of the same overall captive facility). Using captives to self-insure risk offers businesses a number of benefits: they can participate in some or all of their program’s underwriting profitability, maintain end-to-end control over risk (including pricing and claims handling), and avoid paying significant overhead fees to a “middleman” insurer. Companies have several options for structuring and utilizing an insurance captive. They might build a single-parent captive, pool risk in a group captive, or make use of a cell captive. In this blog, we’ll take a look at each. In a single-parent captive, a company will often partner with a fronting carrier to reinsure at least part of their own risk. These are most commonly used by very large companies with exposure to multiple lines of business, which they can insure through the same captive entity. Example: A national food-delivery business wants to provide insurance to its restaurant partners, to protect against the risk of lawsuits related to food safety for meals delivered through the service. It discusses partnerships with several major insurance carriers, but none are willing to provide the level of coverage that the business is looking for at a reasonable price. To get what it needs, the food-delivery business sets up a captive to reinsure a fronting carrier partner, enabling the business to insure its own risk and provide the coverage it needs to its restaurant partners. Setting up a single-parent captive is a considerable undertaking with high capital requirements and a complex setup, with significant ongoing operational requirements going forward. In order to make sense financially, it usually requires a high volume of premium. For that reason, this option is usually only viable for very large businesses. For businesses that can’t afford (either in time or in money) to set up their own captive, a second option is to partner with other businesses in a related industry to set up a group captive. In this scenario, a single captive maintains portfolio capacity that can be shared by a group of entities. The entities can then pool risk together in the single captive. Example: Several real estate companies form a partnership to share a group captive to pool their similar risks. Each company contributes a certain amount of capital to fund the captive, and the capacity is shared among the partners. The participating real estate firms are then able to leverage the captive’s capacity to exercise greater control over their risk, and avoid paying high fees to middlemen. This can allow the partner businesses to share risk (and benefits) between them, and works well for trade associations and other groups of companies in related industries, that share similar risks. However, since the fund is shared between partners as well, one partner’s negative returns can impact the other partners involved. In a cell captive, the business first sets up an entity called a core, which is a similar process to setting up a single-parent captive. Once the core entity is complete, however, the business can much more easily spin up additional cells within the captive structure. The financials for those individual cells are separate from each other, rather than the combined funding of a single-parent or group captive. For many companies, however, using a cell captive doesn’t mean building one themselves. While there are use cases for single-parent cell captives, most businesses that create them then rent out cells to other businesses. Using a cell in another company’s captive entity (also called captive-as-a-service) allows a business to reap the benefits of an insurance captive at a much lower cost. We’ll look at some examples in the next section. The first step in creating a cell captive is to create the “Core” entity. This process is similar to building a single-parent captive: Once the core captive entity has been created and adequately funded, the owner can spin up individual cells within the captive’s structure to support different lines of business, segments, or partners. The Department of Insurance will still need to approve all new cells, but the process is much more streamlined than in prior cases. New cells can often be set up in weeks instead of the months or years typically needed for entirely new captive entities. Captive cells’ assets and liabilities are then statutorily protected from each other (which is where the ‘protected cell captive’ name comes from). This means that if one cell has a difficult year and experiences significant underwriting loss, the assets of the neighboring cells can’t be used to fund that loss. There are multiple ways that cell captives are used, including offering captive-as-a-service (also called rent-a-captive) to other partners or businesses, and separating different parts of the parent company’s business for performance tracking. In a captive-as-a-service or rent-a-captive scenario, the company that owns the captive core would allow other businesses to use cells in its captive. For a fee, the owner can set up a new cell specifically for the partner business, and manage it on their behalf. This lets the partner business leverage the owner’s infrastructure to achieve many of the same benefits of a single-parent captive, without the cost and complexity of creating one. Example: An insurtech specializing in commercial insurance has built a very strong customer base, and wants to further grow its business by participating in some of its own risk. However, building a full captive is too resource-intensive for the insurtech to take on. Instead, the insurtech partners with a CaaS provider and rents a captive cell. The insurtech then uses the cell to self-insure some of its risks, enabling it to participate in the underwriting returns and further scale towards a full-stack insurance business. While the most common reason for building a cell captive is to rent out cells to other businesses, there are a few reasons a company might build one for its own use. Because the cells’ financials are statutorily separated from each other, a cell captive allows a large enterprise to delineate between different lines of business or geographic regions, and monitor their performance separately. Example: A nationwide property management company offers several insurance products to its customers to help protect their personal property and finances. For planning and budgeting purposes, each line is supported by an individual cell in the management company’s cell captive. Over the course of the fiscal year, several lines perform over their targets, while one line significantly underperforms. The other LOBs’ budgets are unaffected by the low-performing LOB’s losses, and the company has clear visibility into which of its products are doing well and which may need a course correction. Cell captives provide a number of benefits to both their owners and the end users: Cell captives are popular for a reason: they offer significant value to both the companies with the resources to build them, and the companies that would rather rent a cell than build a single-parent entity from scratch. To learn more about Captive-as-a-Service with Boost, contact us.

The text "Trends at Money 20/20 2021" appears in white lettering over a dark-colored abstract background

Partnerships and Focus: Big Trends at Money20/20

Nov 3, 2021

It was a busy October for the team at Boost Insurance, wrapping up with one of our favorite industry events: Money20/20. The conference was a super interesting contrast to ITC which was laser-focused on insurance, while Money 20/20 was more about fintech in general and much, much bigger! With fintech about ten years ahead of insurtech in terms of maturity, it’s interesting to see the level of innovation and diversity of companies in our big brother industry. Here are some of the big trends we noticed. One of the really interesting trends that kept being repeated at Money20/20 was a shift in mindset among both fintechs and banks. In the past, they have tended to see each other as competition for consumers’ business and attention but now everyone is moving towards viewing each other as complementary vs. competitive. We saw multiple collaborative efforts between the upstarts and the established, working together to create a better customer experience. This works because they each have a specialization (fintechs excel at meeting modern consumer expectations and banks are experts in profitably navigating a very regulated, very complex business), and partnership lets them bring both those strengths to the table. This was extra interesting to us at Boost because it reflects what we see in insurance, with insurtechs and carriers working together and bringing their own strengths together to meet modern consumer needs and expectations. For example - Boost has built a modern tech platform making various insurance products available via API but partners with established reinsurance companies to facilitate risk transfer. There will still be winners and losers between the incumbents and the upstarts, but as collaboration and competition continue consumers will be the clear winners. A trend I’ve written about before, and one that we continue to see play out, is tech companies’ focus on affinity groups. Fintechs are springing up all over with explicit goals of serving a relatively narrow group of people and serving them well. Companies like Paceline for people focused on health and wellness, Daylight for the LGBTQ+ community, and First Boulevard for African-Americans are just some of the fintechs concentrating on being the best option for a specific set of consumers. This is pretty much the opposite of traditional one-size-fits-all programs - instead of creating something broad that can be good enough for the biggest slice of people, creating something very targeted that can be great for a specific niche. This trend is great news for consumers who traditionally have not been served well by financial services in general. At Boost we’re starting to work with more affinity-focused companies because our modular, customizable product structure allows partners to tailor insurance for their customer needs. It’s exciting to be part of making insurance more accessible to all groups of people! Finally, it was really exciting and validating to see so much interest in new approaches to traditional industries. Finance and insurance have historically had a reputation for being very slow to change, sometimes for good reason (highly regulated, handling people’s money is a big responsibility, etc). This year though there’s a ton of interest in potential innovations, look no further than the enormous presence of blockchain and crypto-focused companies at Money20/20! Boost met with a TON of different companies during the show, and we cannot talk about anything yet but be on the lookout for some very interesting things coming in the near future! Money2020 was a heck of a conference and while my conference year is wrapped, the Boost team will be out and about at shows the rest of the year. We are looking forward to more opportunities to meet people in 2022, so if you did not get a chance to connect with us at Money2020, just drop us a line.