“Insurance is a distinctly complex industry, where the quality of risk decisions has an immense impact on business outcomes. Guidewire and hyperexponential are uniquely positioned to deliver industry-specific AI solutions that will transform commercial underwriting. Together we will bring greater and more scalable intelligence to the insurance decisions that will help underwrite the risks of tomorrow,”said Mike Rosenbaum, chief executive officer, Guidewire.
Las Vegas: US based insurance software maker Guidewire said on Tuesday it would buy hyperexponential for $1.7 billion in cash and up to $400 million more if revenue targets are met, to expand into AI tools that help insurers assess price and risk.
London-based hyperexponential makes AI-powered underwriting and pricing software for commercial property and casualty insurers.
The deal will let AI agents work alongside underwriters to assess risk, price it and make decisions, Guidewire said.
hyperexponential is a London-based agentic platform provider of AI-native underwriting and pricing software for commercial lines P&C insurers. hyperexponential is an existing Guidewire PartnerConnect Technology Alliance Partner.
hyperexponential brings established trust and scale in underwriting, having powered underwriting decisions across more than $75 billion in annual commercial P&C premium for leading global insurers, reinsurers, and managing general agents (MGAs). The acquisition is expected to accelerate ARR and revenue growth while remaining consistent with Guidewire’s long-term margin targets.
The acquisition strengthens Guidewire’s leadership in P&C technology and sets up the company to define agentic underwriting, a new approach in which AI agents work alongside underwriters and actuaries to assess risk, price it, and make decisions, from the most complex specialty risks to high-volume commercial business. Insurers will be able to respond to more submissions, faster, with pricing and risk decisions that consistently reflect their best underwriting judgment.
This will enable insurers to write more profitable business, grow into new lines with confidence, and free underwriting teams to focus on the risks where their expertise matters most.
“Insurance is a distinctly complex industry, where the quality of risk decisions has an immense impact on business outcomes. Guidewire and hyperexponential are uniquely positioned to deliver industry-specific AI solutions that will transform commercial underwriting. Together we will bring greater and more scalable intelligence to the insurance decisions that will help underwrite the risks of tomorrow,”said Mike Rosenbaum, chief executive officer, Guidewire.
“We founded hyperexponential on the conviction that underwriting judgment is the highest-leverage work insurers do,” said Amrit Santhirasenan, CEO and co-founder, hyperexponential.
“Together, we’ll bring insight from submission to bind and from the individual risk to the entire portfolio. With hx and Guidewire, insurers will be able to respond to submissions faster and, more importantly, improve loss ratios and allocate capital more effectively,” he said.
Underwriting speed and accuracy remain vital to pricing risk appropriately and maintaining portfolio resilience as P&C insurers face changing environmental, market, and regulatory conditions. AI-driven reductions in time-to-quote, among other factors, are having a significant effect on P&C insurer revenue, according to the Celent report “AI Trends Across the Insurance Value Chain: P&C Edition – North America.”
Celent notes that “…one industry consulting firm working with US and UK commercial P&C insurers found AI can improve underwriting efficiency significantly in complex lines and reduce loss ratios by percentage points by making use of previously unstructured data like telematics, satellite imagery, and loss history.”
It will fund the deal with $1 billion in new term loans from Bank of America and Citibank as well as cash on hand.
The deal is expected to close in the second quarter of Guidewire’s fiscal 2027 and will not affect its first-quarter forecast.
Guidewire’s software is used by more than 570 property and casualty insurers in 44 countries.
Reuters