Ambac
Ambac is a medium-sized public company based in New York, specializing in municipal bond insurance and property and casualty specialty insurance. With a team of 167 employees, the company has a strong focus on program insurance and managing general agent services, while also operating various subsidiaries and targeting significant growth in its insurance premium production.
Industry Overview
Ambac operates within the insurance industry, specifically focusing on specialty insurance products. The company has established itself in various segments, including Municipal Bond Insurance, Property and Casualty Specialty Insurance, and Managing General Agency services. The U.S. market for Managing General Agents (MGAs) has seen significant growth, doubling in size from 2014 to 2022, indicating a robust environment for Ambac's operations.
Company Structure
Ambac is classified as a public company and employs a team of 167 individuals, categorizing it as a medium-sized business. The company operates several subsidiaries, including Ambac Assurance Corporation and Ambac Assurance UK Limited, which focus on financial guarantee insurance. Additionally, it manages Xchange Benefits, LLC and Xchange Affinity Underwriting Agency, LLC, functioning as property and casualty Managing General Underwriters.
Specialties and Services
Ambac specializes in multiple areas within the insurance sector. Its offerings include Municipal Bond Insurance, Property and Casualty Specialty Insurance, and Participatory Fronting. The company has launched over 35 new Managing General Agency programs and targets niche classes of risk through its program insurance strategy. Ambac's insurance distribution division, Cirrata Group, encompasses several managing general agencies and underwriters.
Financial Performance
Ambac's financial performance reflects a strong position in the insurance market. The company has reported over $1.3 billion in P&C premium production and maintains shareholder equity exceeding $1.3 billion. The balance sheet quality has improved materially, and the company has over $3.5 billion in well-preserved net operating losses not reflected on the balance sheet. Ambac targets mid-teens return on equity at scale over the cycle at Everspan.
Growth and Strategy
Ambac's growth strategy includes building and acquiring property and casualty-focused program underwriting and distribution companies. The company expects its businesses to scale and achieve over $700 million in combined premium. Recent initiatives have led to substantial growth in its new specialty property and casualty business across Everspan and Cirrata, with a focus on achieving over 20% EBITDA margins at Cirrata.