By Chris Munro

April 24 - (The Insurer) - Baseline Risk Partners is making strides in its bid to launch its core admitted workers’ compensation offering next year, with the firm also poised to begin underwriting a diversifying E&S property difference in conditions (DIC) earthquake product.

San Diego, California-based Baseline is led by president and CEO Andrew Petersen alongside co-founder and chief operating officer Ryan Clarkson.

The program administrator was formed last year, and is now ramping up its operations ahead of bringing its product suite to market.

Prior to launching Baseline, Petersen was an executive vice president and regional president at Paragon Insurance Holdings, where he founded and managed its workers’ comp division.

At the time of Petersen’s departure, workers’ comp was Paragon’s largest organically grown division.

Before working on Baseline, Clarkson was chief information officer at Arthur J Gallagher-owned Risk Placement Services, where he helped to scale the business into a $2 billion wholesale and MGA platform.

Clarkson’s career also includes more than seven years at Atlas General Insurance Services, where he latterly served as COO.

Talking to Program Manager, Petersen said Baseline’s core focus will be on the workers’ comp market, a sector he has spent much of his career working in.

“The main business is going to be workers’ comp, and we're going to have two or three E&S programs that will go alongside that,” Petersen said.

With workers’ comp such a highly regulated class, securing the licences and infrastructure necessary to service the business can take time.

Petersen said Baseline has targeted mid-2026 for going live with its first workers’ comp offering in the company’s native California.

Baseline is entering the workers’ comp space just as economic indicators suggest the sector “is finally at the point where rates could start to increase in California”, Petersen said.

He noted that for the first time in almost a decade, a modest workers’ comp rate increase was taken by the market in California at the end of last year.

“If we see three or four consecutive quarters of some rate increase, and just based on experience and what indicators we look at in the markets we serve, we feel there’s an immediate opportunity to help our stakeholders operate to a favourable return,” Petersen said.

While waiting to get the necessary workers’ comp approvals, Baseline’s separate E&S programs division is working on a property DIC earthquake coverage which is expected to go live shortly.

“We should have revenue in that space in a few months,” said Petersen. “It’s a nice diversifying line for us.”

One of the benefits that Baseline has is what Petersen described as its “really cool cap table”, which is composed of individual investors, most of which are tied to the insurance industry in some way.

Petersen said Baseline raised more money than initially planned, meaning the startup has been able to invest heavily in the analytical and operational platform before launching its product offerings.

By having a mixed investor base, and one that is not primarily private equity, Petersen said Baseline’s runway looks a little different to some other MGA startups.

“The support so far has been great,” he said.

“We've shown our investors what we want to do, which takes time, and so our sole focus is to build out the systems, distribution and organic strategies to put us in the best position to service our partners.”

Having the additional capital means that Baseline can add bolt-on E&S programs to support its core workers’ comp focus if and when the opportunities arise, with the property DIC earthquake product a case in point.

When considering those potential opportunities, Petersen said Baseline’s appetite is for E&S business.

“We’ll look at opportunities as they pop up, but right now our focus is on executing the business plan,” he said.

“I see us being probably 60% to 70% workers’ comp over the next few years, and the balance being other E&S lines with our two or three programs.

“Our goal is to execute what’s in front of us before we look at other deals or capital structures.”