From Adversity to Resilience: Pekin Insurance's Tech-Driven

In 2023, Pekin Insurance faced the worst financial loss year in its history. The Illinois-based property casualty and life insurance carrier recorded a staggering US$170m net loss. Just twelve months later, the company achieved its most profitable year in two decades.

Key to this remarkable transformation was the support enabled by Pekin’s technology ecosystem led by Amy Bingham, the firm’s Vice President and Chief Information Officer. It was her strategic deployment of technology partnerships and platform modernisation initiatives that played an integral role in the company's dramatic turnaround.

"In a one-year timespan, we went from having the worst loss year to the most profitable in almost two decades " Amy explains. The achievement represents an unprecedented recovery in an industry where such rapid transformations are virtually unheard of.

Pekin Insurance operates across 22 US states and employs around 700 staff members, while distributing its products through around 1,500 agencies and a network of 8,500 agents. Property and casualty insurance is offered in eight states, with strategic expansion plans for the next decade.

Amy Bingham joined Pekin Insurance three and a half years ago after spending over 20 years with a large US carrier. Her mandate was clear: help Pekin grow and transform through modernised technology capabilities. Little did she know that her technology strategy would be key to helping her new company navigate the greatest period of intense operational and financial strain since its founding in 1921.

It wasn’t just Pekin, though. In 2023, the insurance sector at large was facing unprecedented challenges, with climate-related risks and macroeconomic pressures dovetailing to create a perfect storm. Guy Carpenter, a global risk and reinsurance specialist, reported 28 separate billion-dollar disaster events in the US — among the highest on record.

For Pekin Insurance, the primary threat came from a series of severe convective storms concentrated in the centre of the US. These thunderstorms, often accompanied by high winds and hail, destroyed cars, homes and commercial properties indiscriminately. Inflation and rising replacement costs compounded the financial damage. "Our biggest impact is typically severe thunderstorms, primarily those that have hail damage coupled with very high wind impacts," Amy reveals. 

The severity of the crisis extended beyond individual companies. AM Best, the American credit rating agency focusing on insurance, downgraded the entire personal lines industry outlook from stable to negative. However, Pekin managed to maintain its A-minus excellent rating, providing a crucial foundation for its recovery efforts going forward.

How Pekin Insurance bounced back

By the second quarter of 2023, Pekin's leadership team knew they needed to take some swift action, implementing a series of sweeping measures to address the mounting losses and growing financial instability.

The firm temporarily halted all new business across personal lines for home and vehicle insurance — a policy which remained in place for an entire year. Pekin also decided to remove itself from geographical markets that it viewed as particularly high-risk, exiting all personal lines in Iowa while maintaining commercial lines and life operations.

The team also withdrew themselves from several high-risk product segments, ended relationships with unprofitable agencies and made the difficult decision to reduce the size of its workforce — all measures designed to reduce risk concentration and improve the firm’s chance of profitability.

With these changes in place, Pekin Insurance projected an 18% reduction in direct written premium for 2024 but in return would reduce exposure to storms and natural catastrophes by 50%. And as if that wasn’t enough, this intentional revenue decline was accompanied by an effort to reduce forecasted expenses by 25%, totalling US$70 million. 

"We needed to make decisions rather swiftly so that we could make the changes needed to realise the benefits," Amy explains. The ability to make rapid, data-driven decisions became crucial to the company's recovery.

The decision-making process relied heavily on modern technology capabilities. Pekin's Guidewire platform, combined with enhanced data analytics, enabled business leaders to model various scenarios. This technological foundation allowed the company to project the impact of different strategic choices on overall profitability.

Turning to technology in a crisis

With that target of reducing expenses by US$70m, Amy sensed an unexpected opportunity for the company. Rather than retreating from innovation during Pekin’s crisis, she saw that, with a few strategic investments, she and her team could reduce costs whilst also improving their capabilities.

So, with renewed determination, Amy presented a series of business cases for technology modernisation initiatives. The first focused on migrating the company's integration platform to WSO2, a provider of integration platform services. WSO2 is recognised by research firm Gartner as a visionary in the integration space, with platforms built primarily on open-source capabilities. "The heavy emphasis on expense reduction became the catalyst for the business case for these initiatives," Amy says.

The second major initiative involved partnering with One Inc, a provider of digital payment capabilities. This project aimed to modernise customer billing and claims payments through a digital wallet system. Pekin already had a relationship with One Inc for claims payments, making expansion into premium payments a natural progression.

The One Inc implementation enabled compliant and cost-effective credit card merchant fee processing. This modernisation effort contributed over US$3m in annual expense reductions while also improving Pekin’s customer experience.

Pekin also partnered with Exavalu, a technology services provider, to further target its CX. Exavalu is helping Amy and the team to deliver a sleek, modern customer self-service portal, making Pekin’s digital ecosystem more efficient and more enjoyable for its users to navigate.

These technology modernisation efforts occurred alongside operational changes required for market exits and product portfolio refinements. The agile IT operating model that Amy had implemented enabled rapid priority shifts to meet evolving business needs.

The importance of partnerships

Amy's approach to partnerships in the tech sector reflected both some hard-nosed financial knowhow and some strategic thinking. The selection of WSO2 demonstrated the importance of vendor partnership throughout complex migration projects.

"They absolutely came to the table with a commitment and investment to make sure that this migration was successful," Amy explains regarding WSO2's partnership approach. The vendor's support during inevitable hurdles and setbacks proved crucial to project success.

One Inc's selection reflected strategic considerations around platform integration. As a marketplace provider for Guidewire, One Inc offered inherent integration capabilities with Pekin's core policy administration, billing, and claims platforms. This alignment simplified implementation and reduced integration complexity.

This strategy of collaboration extended beyond immediate savings too. Amy is a firm believer in the importance of building long-term relationships with vendors. In a sector so focused on costs, these things become more and more valuable in a moment of difficulty.

Measuring success through data

The true test of Pekin's strategic response came in 2024's results. Despite the insurance industry facing such trying circumstances, Amy and her team managed to see through some remarkable improvements.

Firstly, the company reduced its storm losses by 65% compared to 2023, which translated to US$88m in avoided losses. It wasn’t that Pekin simply got lucky with a year that contained fewer extreme weather events — it was down to strategy.

"This data proves that the actions we took had a meaningful impact in transforming the company," Amy explains. The results validated the difficult decisions made during the crisis period and demonstrated the effectiveness of the integrated approach.

Pekin recorded US$44m in net income for 2024, surpassing projections and targets by a huge distance. It represented a quite remarkable US$214m improvement from the previous year's US$170 million loss, making 2024 the firm’s most profitable year since 2005.

The financial turnaround occurred despite 2024 being considered the fourth-highest disaster impact year on record across the United States. This context underscores the significance of Pekin's strategic mitigations and their effectiveness in reducing risk exposure.

How technology can transform the insurance sector

Amy highlights that Pekin Insurance’s organisational values provided a foundation for the successful transformation. They include: being quick to communicate, respond and solve issues; innovating in products, technology and thinking; being nimble in adapting to challenges; and (perhaps most crucially) having a tech-savvy approach to business.

These values, established before all the adversity of 2023, proved to be instrumental in Pekin’s response, with the company culture supporting those difficult decisions and the rapid changes required for recovery.

After recording such astounding successes in 2024, Amy is determined to maintain Pekin’s momentum, hunger and spirit of collaboration.

After having to exit some of its personal lines product markets during its toughest moments, Pekin Insurance partnered with ValueMomentum to launch its Autocare Services Business Owners Policy (BOP) in  2025, Purpose-built for the auto care service industry, the product covers 17 distinct business classes with coverages tailored to their unique operational needs.  

The digital experience was designed with agents in mind, making it easier to navigate, quote, and deliver the right protection efficiently.  Pekin will continue to partner with ValueMomentum on strategic projects to grow the business through additional product deployments and geographic expansion.

It’s easy to see why Amy wants to replicate the strategy she and her team first implemented back in 2023. "Those values absolutely played a part in the transformation that we've experienced over the last couple years," she says. 

She reflects on what has been an intense period of her professional life with great pride. "Being part of such a successful turnaround has been extremely rewarding. I'm very proud of Pekin's senior leadership team across our business units that made very difficult decisions, and the technology teams that delivered on those transformational changes."

To read the full article in the magazine, click HERE.