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Blackstone Insurance Solutions and Management Changes

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Michael McRaith

On March 19, 2018, the Blackstone Group (BX) made an announcement regarding a new member of the senior management team of Blackstone Insurance Solutions. Michael McRaith, former director of the U.S. Department of the Treasury’s Federal Insurance Office, will become the company’s managing director. With the help of Blackstone Insurance Solutions, insurers should be able to utilize his investment management experience as well as Blackstone products.

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As a result, insurers could benefit since they might be able to fulfill policyholders’ long-term obligations as well as improve shareholder value. McRaith will report to Chris Blunt, the current CEO and senior managing director of Blackstone Investment Solutions. As the company diversifies, it says it will do more hiring.

Blunt’s and McRaith’s viewpoints

According to Blunt, McRaith comes with a strong track record in the insurance industry as well as experience at various federal, state, and international levels.

McRaith reflected positive views on the future prospects of Blackstone Insurance Solutions. He said the company will be supporting insurance companies to fulfill the obligations they have assumed. He continued that since Blackstone has a strong track record with respect to investment management, its insurance platform would allow insurance companies to offer customized investment products that would be made with policyholders’ interests in mind.

Blackstone’s competitor KKR & Co. (KKR) hired Xavier Niel as its independent director. Blackstone has a return on equity of 36.3% on an LTM (last-12-month) basis, while its peers CBRE Group (CBG), Carlyle Group (CG), and Ameriprise Financial (AMP) have returns on equity of 23.7%, 43.1%, and 28.7%, respectively, on an LTM basis.

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