Sanjoy Mukherjee Talks Law, Business, and Reinsurance

Everest Re Group's Sanjoy Mukherjee describes how risk is a part of his life both in and out of the office

“I don’t know how many people go into college thinking they want to work for an insurance company,” says Sanjoy Mukherjee, who serves as executive vice president, general counsel, and secretary at Everest Re Group, one of the largest reinsurance groups in the world. Mukherjee didn’t grow up wanting to work in insurance; he wanted to be a pilot in the military. Yet success in the business world allows him to pursue adrenaline-pumping hobbies as an aerobatics pilot and race-car driver on the weekends. Looking back on twenty-four years in the insurance industry, Mukherjee thinks risk management is nearly as thrilling as risk-taking.

“When I was in high school and college, I always thought of insurance as pretty boring and stodgy, without a lot of sexiness, but I’ve learned that it really is a dynamic industry,” Mukherjee says. “There is a lot of science, intellectual capital, and creativity that goes into it.”

“when I was in high School and College, I always thought of insurance as pretty boring and stodgy, without a lot of sexiness, but I’ve learned that it really is a dynamic industry.”

Mukherjee started out as a public accountant, but soon ended up at Andersen Consulting (now Accenture), where he had the opportunity to apply his accounting skills toward improving the information systems, operational strategies, and organizational structure of the client companies. For him, it was a compelling challenge. As he moved into senior consulting roles at Andersen, Mukherjee found himself spending more time drafting contracts, something he felt a knack for, and an experience that propelled him into law school a few years later.

“Soon other partners in the firm were sending me their contracts instead of using outside lawyers,” Mukherjee says. “I ended up becoming almost an in-house lawyer.”

After graduating from Benjamin Cardozo Law School in 1994, Mukherjee wound up in the litigation unit of a large law firm that focused on the insurance and reinsurance industry. There, the combination of law, accounting, and insurance expertise that has characterized Mukherjee’s career ever since began to take shape. It has proven to be a potent formula for success. He moved to an in-house position at Everest in 2000 and was promoted to general counsel five years later.

Mukherjee admits that he never intended to stay at Everest in the long term. “I actually joined Everest to gain insight into how senior management at a large insurance company thinks,” he says. When he was promoted to senior vice president, he finally disclosed his original plan to the CEO. “I wanted to learn the innerworkings and the financial structure of an insurance company,” he says. “And then I wanted to go back into private practice to represent policyholders in suing insurance companies.”

By that time though, Mukherjee’s ulterior motives had dissolved, and he realized he’d found a niche where his dual training in law and accounting could flourish. His understanding of the complex legal issues that a publicly traded insurance company faces, as well as how its financials worked, unlocked a lot of doors. “The ability to bridge barriers and explain complex legal issues in financial terms, and vice versa, is where the true value of a legal department really comes into force,” Mukherjee says. “The true measure of success for an in-house lawyer is when he understands the business and operations well enough to be considered by senior management as a true business counselor, adviser, and partner.”

Everest provides a variety of conventional insurance products, but the bulk of its business is in reinsurance—insurance for insurance companies—which is an increasingly dynamic business market, and one in which Mukherjee relishes his role. A gamut of complex financial instruments are involved, but he explains that the overriding concept in reinsurance is to provide risk protection to other insurance companies to protect and preserve capital, and therefore the ability to extend greater risk in the form of policies. “It’s another layer of insurance and risk transfer,” he says.

Treaty reinsurance insures a portfolio of risk in a given line of coverage, such as homeowners or casualty insurance, while facultative reinsurance is geared toward specific policies. To make it even more complicated, reinsurers utilize a form of reinsurance—known as retrocession coverage—to decentralize their own exposure. Ultimately, the reinsurance industry is about spreading the risks out over many players rather than piling them up inside a single company. If there is an earthquake in California, some of the insurers in the region could easily end up underwater with their investors suffering big losses. Reinsurance is designed to prevent those scenarios.

“Insurance is a form of gambling,” Mukherjee says. “You’re placing bets on the potential types of risks or exposures.” He uses the property catastrophe space as an example. If the wind doesn’t blow, and the earth doesn’t shake, you’ll do pretty well, he says, adding that at the same time, you have to be prudent with risk management. “You can’t just allocate huge amounts of capital in narrow geographic zones,” he says. “Because you have an obligation to your shareholders to manage the capital prudently.”

Everest is a global company with a diverse portfolio of insurance and reinsurance products, which provides long-term stability in a risky business. Taking advantage of a growing demand, Everest has recently expanded into the specialty-lines insurance business. Mukherjee was involved in the formation of Everest’s Specialty Insurance Group (SIG), a relatively new affiliate of the company that provides insurance and risk-transfer products to the sports and leisure industry. It includes special events, amusement parks, fairs, festivals, sports venues, and contingency coverage for event cancellations and contests with large cash payouts. Mukherjee says they have even been expanding into insurance for motor sports. “It’s an area that I like only because auto racing is one of my hobbies,” he says.

Mt. Logan Re, a new Everest subsidiary formed two years ago, is proving to be one of the company’s most lucrative vehicles to attract new investments. Known in the insurance industry as a “sidecar,” Mt. Logan Re is a third-party capital provider for reinsurance risks that functions like a hedge fund focusing on catastrophe-linked securities. Catastrophe-linked securities have historically shown low levels of correlation to the broader credit and equity markets and produce attractive risk adjusted returns. The lines of exposure are designed to be very narrow—Florida properties in hurricane country, for example—and offer better returns than traditional investment products, such as bonds and securities.

Unlike traditional sidecars, however, Mt. Logan Re is a permanent, open-ended, actively managed vehicle. Mt. Logan Re offers a variety of investment options across the risk spectrum, giving investors the ability to gain exposure to low, medium, or high-risk property category portfolios by investing in particular funds. Since Mt. Logan Re’s inception on July 1, 2013, these funds have generated cumulative returns of 21 percent, 37 percent, and 61 percent respectively.

“If it turns out well, the investor can make a great return, because they don’t have exposure to other areas of the company,” Mukherjee says. “We haven’t had a lot of natural catastrophes in the last three or four years in the US, which has helped us in terms of returns,” he adds, noting that the Mt. Logan Re portfolio has gone from zero to nearly $750 million in assets under management in its first eighteen months.

Everest’s nimble, team-oriented approach helps address client needs quickly, and Mukherjee hopes that creative, open culture will also aid recruiting efforts. As one of the largest reinsurance corporations in the world, Everest continues to operate with the atmosphere and agility of a small organization. That philosophy inspires Mukherjee and drives Everest’s success.


Profile would like to congratulate Sanjoy Mukherjee on his promotion to managing director and chief executive officer of Everest Reinsurance–Bermuda. The company announced the succession in January 2016 and Mukherjee will assume the role in April.