Jay Rajendra
ARCH CAPITAL GROUPAbout Jay Rajendra
Jay Rajendra is Arch Capital Group Ltd.’s Chief Strategy and Innovation Officer. He joined Arch in August 2016 as Chief Analytics Officer (2016–Jan 2020) and now leads analytics, new business models and technology initiatives to improve profitability and growth. He is a Fellow of the Institute of Actuaries and Casualty Actuarial Society, a Member of the American Academy of Actuaries, holds a combined BA/MA in Mathematics from Oxford University, and an MBA from MIT; age 44 as disclosed in the 2025 proxy . Company performance context during his tenure includes strong long-term TSR and book value growth; Arch reported 2024 net income of $4.3B, operating ROE of 18.9%, and a 13% increase in BVPS to $53.11 .
| Performance Metric | 5-Year | 3-Year | 1-Year |
|---|---|---|---|
| Annualized ROE | 17.7% | 20.6% | 22.8% |
| Annualized Operating ROE | 13.8% | 17.5% | 18.9% |
| Total shareholder return (TSR) | 126.4% | 118.5% | 30.8% |
| Total book value return per share | 101.0% | 58.3% | 13.1% |
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Arch Capital Group Ltd. | Chief Strategy & Innovation Officer | 2020–present (age/tenure disclosed; start date at Arch 2016) | Leads analytics and innovation to improve profitability and growth |
| Arch Capital Group Ltd. | Chief Analytics Officer | 2016–Jan 2020 | Built analytics capabilities underpinning underwriting and portfolio decisions |
| XL Catlin (Strategic Analytics) | Head of Business Solutions | Not disclosed | Led analytics-driven pricing/strategy solutions for a global (re)insurer |
| Towers Watson (North America & Europe) | Senior Consultant | Not disclosed | Advised large (re)insurers and startups on pricing, strategy and M&A |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| — | — | — | No public company board or external directorships disclosed for Rajendra in Arch’s proxies |
Fixed Compensation
- Individual compensation details (base salary, target bonus) for Rajendra are not disclosed; he is not a Named Executive Officer (NEO) in the 2025 proxy. Arch’s plan design for executives uses market benchmarking and mixes fixed salary with at‑risk incentives .
- 2024 NEO target bonuses (context): CEO 185%→200% post-transition; Presidents (Reinsurance/Mortgage; Insurance) 165%→185%; CFO 150%; CIO 150% .
- Arch’s say‑on‑pay support remains strong, indicating investor alignment with the overall program design (95.3% in 2024) .
| Context (NEO) | 2024 Target Bonus % | Source |
|---|---|---|
| CEO (pre/post transition) | 185% → 200% | |
| Presidents (Reinsurance/Mortgage; Insurance) | 165% → 185% | |
| CFO | 150% | |
| CIO | 150% |
Performance Compensation
Arch ties executive incentives to value creation metrics that cascade across senior leadership:
- Short‑term incentive (STI): 70% financial (ROE-based across units and group) and 30% strategic goals. 2024 group ROE target was 13.69%; achievement of 129.6% produced a 200% payout factor at target for STI at the group level .
- Long‑term incentive (LTI): Performance shares (55% of LTI value), stock options (25%), and restricted shares (20%). Performance shares vest based on 3‑yr adjusted tangible book value per share (ATBVPS) growth with a relative TSR modifier (+/‑25%) vs. a defined peer group; maximum 200% of target .
| Element | Metric(s) | Weighting/Design | 2024 Targets and Outcomes | Vesting/Holding |
|---|---|---|---|---|
| STI (annual) | ROE (financial) + strategic goals | 70% financial / 30% strategic | ROE target 13.69%; 2024 achievement 129.6% → 200% multiple at group target; Operating ROE 18.9% | Cash; annual cycle |
| LTI – Performance Shares | 3‑yr ATBVPS growth; TSR modifier | 55% of LTI value; threshold 50%, target 100%, max 200% | ATBVPS growth target 11% (2024 grant); prior cycle (2022–2024) paid 200% based on performance; TSR over 3 yrs was 116% (modifier framework in place) | Earned shares vest after period; subject to modifier caps |
| LTI – Options | Stock price appreciation | 25% of LTI value; 10‑yr max term; strike ≥ grant close | — | 3‑yr ratable vesting; standard holding not specified beyond ownership policy |
| LTI – RS | Time‑based retention | 20% of LTI value | — | 3‑yr ratable vesting |
Note: In November 2024, Arch granted special “Outperformance Awards” to selected NEOs (not including Rajendra as disclosed) consisting of premium‑priced stock options (1.685x market; ~$161.24 strike on 11/19/24 grants) and restricted shares, with 3‑year cliff vesting for options, multi‑year holding, and restrictive covenants designed to enhance alignment and retention .
Equity Ownership & Alignment
- Beneficial ownership for Rajendra is not itemized in the 2025 proxy’s “Security Ownership” table (which covers >5% holders, directors, and NEOs) .
- Executive ownership policy: CEO 6x salary; Section 16 officers/NEOs 4x salary; five years to comply; must retain 50% of net shares until guidelines met .
- Hedging and pledging: Hedging is prohibited; pledging discouraged and capped at the lesser of 30% of beneficially owned shares or 0.5% of outstanding shares; pledged securities do not count toward ownership guidelines .
- Clawback: All incentive‑based compensation for executive officers is subject to clawback on financial restatement .
| Alignment Policy | Key Terms | Source |
|---|---|---|
| Stock ownership guidelines | CEO 6x salary; Section 16 officers/NEOs 4x salary; 5 years to comply; 50% net‑share retention until met | |
| Anti‑hedging | No short sales, derivatives, or hedging transactions | |
| Pledging limits | Max the lesser of 30% of owned shares or 0.5% of outstanding; pledged shares excluded from ownership calc | |
| Clawback | Incentive pay subject to recovery upon restatement |
Disclosure gap: Section 16 ownership/transactions (Form 4) would quantify Rajendra’s current beneficial holdings, vested/unvested awards, and any selling pressure; this was not provided in the proxy and is not retrievable from the documents searched above.
Employment Terms
- Individual employment agreement, severance, and change‑of‑control specifics for Rajendra are not disclosed in the proxy (he is not an NEO). Company‑wide constructs include:
- Double‑trigger change‑in‑control treatment for equity awards assumed by an acquirer .
- No excise tax gross‑ups; no guaranteed bonuses; minimum vesting periods .
- Insider trading policy and restrictive covenants standard in award agreements; special Outperformance Awards for NEOs include lengthy vest/holding and non‑compete obligations (10‑year non‑compete linked to option exercisability) .
Performance & Track Record
- Arch’s diversified platform delivered $4.3B net income in 2024 and record P&C NPW ($14.6B), with Mortgage segment underwriting income >$1B for a third consecutive year; investment income rose 45% per share; 2024 combined ratio was 82.5% .
- Over 2001–2024, BVPS rose from $2.03 to $53.11; long-term TSR is robust, with 10‑yr compounding of 17.3% and 2024 share price closing at $92.35 .
- At an Arch investor event, CEO highlighted Rajendra’s role leading analytics and automation across the group, with ~80% of his work focused on the Insurance group—supporting underwriting insight and portfolio defense .
Say‑on‑Pay & Shareholder Feedback
| Year | Say‑on‑Pay Approval |
|---|---|
| 2020 | 94.6% |
| 2021 | 95.1% |
| 2022 | 94.6% |
| 2023 | 93.9% |
| 2024 | 95.3% |
Investment Implications
- Pay-for-performance architecture is tightly linked to ROE and ATBVPS growth with a TSR modifier, supporting alignment for senior executives, including strategy and analytics leadership roles that influence underwriting discipline and capital deployment .
- Anti-hedging, restrictive pledging limits, and stock ownership/holding requirements reduce near-term insider selling pressure and emphasize long-duration alignment; however, Rajendra’s individual ownership and vesting overhang are not disclosed in the proxy, leaving an information gap on potential transaction-driven signals .
- Retention risk appears mitigated by program design (multi-year vesting/holding) and career progression pathways; special Outperformance Awards were targeted at NEOs during leadership transition, not disclosed for Rajendra—suggesting standard LTI applies, which still embeds multi-year performance and retention hooks .
- Actionable next steps: Monitor Section 16 filings for Rajendra to track ownership changes and Form 4 transaction cadence; cross-reference vesting calendars and any 10b5‑1 plans for potential supply signals. The proxy documents searched here did not include those filings.
Sources: Arch Capital Group Ltd. DEF 14A (2025) , DEF 14A (2024) , DEF 14A (2023) , DEF 14A (2022) , 8‑K (Nov 8, 2024) , Arch Investor materials (Nov 14, 2024) .