Former CNA Chief Financial Officer Robert Deutsch knows that if you rush in where angels fear to tread you better not be a fool. That is why the chief executive officer of the recently formed Ironshore Insurance Ltd. said that all of the most sophisticated catastrophe models in the world don’t mean a thing without the true gut of an underwriter.

“The key obviously is in your risk selection,” Mr. Deutsch said during a recent interview with National Underwriter. “The models can help supplement your task, but they are just one piece of the underwriting equation. They don’t replace sound judgment.”

Backed by $1 billion in capital and a brokerage sponsor–New York-based Integro Ltd.–the new Bermuda-based insurer has been formed to write U.S. property-catastrophe risk.

Just a few days into 2007, Ironshore Insurance Inc. said it raised more than $1 billion through a private placement of its equity securities, and that it would begin underwriting specialty lines of insurance immediately through its subsidiary, Ironshore Insurance Ltd.

The global specialty insurer was created in response to crisis conditions in the U.S. property-catastrophe insurance markets.

Ironshore will initially write a worldwide book of property business, the company said in a statement, adding that because of marketplace demands, the company’s initial focus would be on commercial risks with wind exposures in catastrophe-prone coastal states such as Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina, South Carolina and Texas, as well as the Caribbean and Yucatan Peninsula.

Ironshore will also provide commercial earthquake coverage in California.

While most new private equity capital in Bermuda has gone to the reinsurance sector, Mr. Deutsch said it was precisely for that reason that he chose the primary route.

“Reinsurance–everyone has done that. We just thought we could make more of a mark in this area,” he said.

No one can deny the capacity crunch that exists in the commercial sector in the Gulf states. Just last month, Louisiana Insurance Commissioner James Donelon had to jawbone St. Paul Travelers into curtailing cutback plans for the $3 billion of commercial coverage it writes in the state from about 80 percent to 40 percent.

St. Paul Travelers is the commercial market leader in Louisiana. The other commercial writers in the state have announced cutbacks in line with the reduced percentage that St. Paul Travelers agreed to.

While the state’s residual market can pick up some of the slack, it will not be enough, and he noted that some surplus lines writers have moved in.

“Well, tell the commissioner to give us a call,” Mr. Deutsch said.

Plans for the time being are for Ironshore to focus on the property-catastrophe market. “But over time we will probably get into more specialty lines,” he said.

He does foresee some consolidation in Bermuda as the carriers formed in the wake of Sept. 11 and Katrina have proliferated. “There certainly is a need for the capital, but the question is do you really need all these start-ups,” he said.

The founders of Ironshore are Robert Clements and John Clements through their investment vehicle, Tara Partners Fund LLC, and Ironshore management.

Robert Clements is known to the industry for having founded several Bermuda-domiciled insurance and reinsurance companies, including ACE Ltd., XL Capital Ltd. and Arch Capital Group Ltd.

Like ACE and XL, Ironshore is being sponsored by a global insurance broker–in this case, Integro. (ACE and XL were originally sponsored by Marsh & McLennan.)

Investors are Bear Stearns Merchant Banking, Corporate Partners (a business unit of Lazard Alternative Investments), Fremont Partners, TowerBrook Capital Partners and Greenhill Capital Partners.

Mr. Deutsch, who has worked in the insurance industry for 25 years, formerly served as the CFO of Chicago-based CNA, and before that held the same title at Executive Risk.

Leslie J. Rock will serve as Ironshore’s president and chief underwriting officer. Mr. Rock has served as chief property underwriter for three of the leading property syndicates at Lloyd’s over the past 25 years.

Ironshore’s leadership team also includes Mitchell E. Blaser, most recently the CFO of Swiss Re America and Marsh Inc, who has been appointed chief financial officer.