I'm leading a $100 million corporate turnaround. Here's why I learned to distrust the growth mindset

As a seasoned professional in the insurance sector, I have witnessed numerous insurtech companies adopt growth strategies that are more suited to industries where increased scale translates into profitability. The insurance landscape does not operate under the same assumptions. My oversight of a $100 million turnaround has illuminated how some businesses are deriving erroneous lessons from Silicon Valley's approach, which prioritizes growth at any cost.

The insurance industry's growth trap

In the realm of insurance, the emergence of digital competitors has not yielded increased prosperity; instead, it has diverted attention from the essential principles that sustain the industry. In recent years, premiums have surged, with increases of up to 70% observed in just five years. Insurers are withdrawing from high-risk regions across the United States, creating significant gaps in coverage.

Our industry is not isolated in its pursuit of growth. A historical overview reveals that many businesses have suffered from confusing expansion with resilience, only to confront the stark reality that mere scale does not rectify weak foundations. Hippo has faced a similar reckoning.

The turnaround journey

Assuming the role of CEO in June 2022, I found Hippo navigating one of the most challenging phases in its history. The nadir occurred in the third quarter of 2023. However, by the end of 2025, we facilitated a transformation from a net loss of $41 million to a net income of $58 million. My confidence remained unshaken, informed by over 30 years of experience in the insurance field, which has shown me that such cycles are intrinsic to the industry. The insurance market is inherently cyclical; conditions change, assumptions falter, and businesses face the choice between adaptation or reliance on outdated paradigms.

Our turnaround was not the result of a singular breakthrough or drastic cost reductions. Rather, it was born from acknowledging that previous assumptions—such as stable risks, reliable loss patterns, and the expectation that growth would ultimately yield profitability—were no longer valid.

The changing economic reality

The cessation of these assumptions can be traced back to a fundamental shift in economic conditions. Climate volatility has intensified, making losses more challenging to predict, while the costs associated with risk absorption have escalated. Firms designed to operate under stable conditions found themselves confronting an altered landscape.

With the increase in climate-related losses, insurers have been compelled to raise rates merely to achieve break-even, alongside rising capital costs necessary for risk management. This shift has driven premiums higher and reduced affordability. While many in the industry have commonly attributed setbacks to "extreme" weather events, the more profound issue lies in the failure of some companies to accurately price risk and distribute it intelligently.

An alarming number of competitors appear to overlook the fundamental nature of our business: we are in the risk management industry, and ignoring these economic signals could be detrimental. In an environment where risk is compounding and unpredictability is heightened, pursuing growth can swiftly lead to failure.

Strategic choices and consequences

The implications of these strategies are significant. Insurers, including our own, have had to pause new business initiatives, reduce exposure, and increase rates in certain regions. While raising premiums may offer a temporary solution, it does not address the foundational challenges.

Sustainable resilience necessitates a proactive approach focused on prevention rather than merely treating the symptoms of failure. In our industry, this entails developing more robust homes, enhancing mitigation efforts, implementing updated building standards, and innovating insurance models that evolve with shifting climate risks.

The insurance sector, akin to other industries, must be prepared to make challenging decisions to safeguard long-term durability. At times, it may be essential to make sacrifices in one area to preserve the whole. The optimistic perspective is that, if executed correctly, recovery is possible.

Hippo's path to resilience

This guiding philosophy influenced our strategic decisions, leading us to pause new business in select areas, limit exposure in disaster-prone regions, and resist the allure of uncontrolled growth. Furthermore, we divested our homebuilder distribution network in 2025. By focusing on our core competencies—underwriting and risk selection—we significantly expanded our access to the new home market, increasing partnerships from six homebuilders to over 50.

What some perceived as retreat was, in actuality, a strategic investment in long-term resilience over transient growth. However, mere discipline was insufficient; we also required the agility to adapt more quickly than traditional insurers typically manage.

Learning from tech: Speed and adaptability

This is where the insurance industry can derive valuable insights from the technological sector. The turnaround of Hippo was enabled by leveraging data and analytics, which provided the necessary speed of response. This involved advanced underwriting practices, utilizing external data such as property-level insights and environmental risk assessments, continuous re-evaluation of risk at renewal, and effective risk segmentation across both our balance sheet and our partners.

Rather than fixating on growth, enterprises across various sectors should prioritize adaptability. We consistently experimented: adjusting prices, re-underwriting, and responding to changes in geographic risk exposure. Notably, over the course of two years, we revised our strategy eight times, which is practically unprecedented in the insurance industry. These modifications kept us on course.

The real lesson

Silicon Valley offers valuable lessons for various industries, particularly regarding speed, experimentation, and strategic risk management. However, in unpredictable markets, it is resilience, precision, and adaptability that increasingly dictate success. While growth remains important, it is essential that sustainable growth is founded upon a basis of discipline.