John Burkhart
Executive Vice President and President, Specialty Lines & Industry Solutions at Skyward Specialty Insurance Group
Executive
About John Burkhart
John Burkhart (age 56) serves as Executive Vice President and President, Specialty Lines & Industry Solutions at Skyward Specialty Insurance Group, Inc. (SKWD), a role he has held since January 2021. He holds a B.S. in Finance from Western Michigan University and brings nearly 30 years of specialty lines experience spanning management and professional liability, healthcare, financial institutions, and transactional liability . Company performance during his tenure shows strong fundamental growth: revenues rose from $646.9M* (FY22) to $1,134.9M* (FY24), EBITDA from $60.3M* to $165.6M*, and net income from $39.4M* to $118.8M*, supporting a pay-for-performance model emphasizing operating discipline and capital accretion (values retrieved from S&P Global).
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| QBE Insurance Group Limited | Senior Vice President, Head of Professional Lines and Industry Verticals | Nov 2013 – Sep 2020 | Led professional lines and industry verticals; deep specialty underwriting and segment leadership |
| Chubb Limited | Various roles including Vice President — Specialty Lines | Jun 1992 – Oct 2013 | Specialty lines experience across management/professional liability, healthcare, financial institutions, transactional liability |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 400,000 | 418,750 | 464,584 |
| All Other Compensation ($) | 15,250 | 37,500 (includes $16,500 401k + $21,000 discretionary adjustment) | 3,542 |
Notes:
- Company policy: no executive perquisites; broad-based benefits only (medical, dental, vision, life insurance, 401(k) match, ESPP) .
- Additional positive pay practices: no hedging/pledging; no tax gross-ups; clawback policy; stock ownership guidelines .
Performance Compensation
Annual Incentive (STIP)
- Structure: Annual cash bonus tied to Company performance goals/OKRs; performance factor capped at 150%; Committee retains discretion to recognize extraordinary achievement .
- 2024 STIP parameters and outcome for Burkhart:
- Target: $300,000
- Maximum: $450,000
- Actual Paid: $450,000
| Year | Target ($) | Maximum ($) | Actual Paid ($) | Notes |
|---|---|---|---|---|
| 2022 | — | — | 290,000 | Performance bonus earned and paid for FY22 |
| 2023 | — | — | 450,000 | Includes STIP; plus one-time discretionary $21,000 adjustment for LPT charge impact |
| 2024 | 300,000 | 450,000 | 450,000 | Paid March 2025 per company convention |
Long-Term Incentives (Equity)
- Design: Mix of time-based RSUs and performance-based PSUs under the 2022 LTIP .
- PSU metrics and weighting: 50% internal Combined Ratio (CR) over 2024–2026 and 50% GBVPS (Growth in Book Value Per Share) vs peer group over 2024–2026; vest eligible on Dec 31, 2026; 0–150% payout cap .
| Award Type | Grant Date | Metric | Weighting | Target | Maximum | Grant-Date Fair Value ($) | Vesting |
|---|---|---|---|---|---|---|---|
| RSU | 02/27/2024 | Time-based | N/A | 3,490 units | N/A | 127,141 | Eligible 12/31/2026, service-based |
| PSU | 02/27/2024 | Internal CR | 50% | 2,792 units | 4,188 units (150%) | 254,281 (target) | Eligible 12/31/2026, performance + service |
| PSU | 02/27/2024 | GBVPS vs peer | 50% | 2,792 units | 4,188 units (150%) | 254,281 (target) | Eligible 12/31/2026, performance + service |
Multi-year LTIP context:
- 2023 stock awards (aggregate RSU+PSU grant-date fair value): $609,440 .
- Outstanding equity awards at 12/31/2023 include 2023 RSUs and PSUs scheduled to fully vest on 01/01/2026 .
Equity Ownership & Alignment
- Beneficial ownership: 21,750 shares held directly; less than 1% of outstanding shares (40,330,643 shares outstanding) .
- Outstanding, unvested awards (12/31/2023):
- RSUs: 3,619 units; market value $122,612 (at $33.88 closing price)
- PSUs (target): 7,238 units; payout value $245,223
- Additional 01/12/2023 awards reflected: 13,330 and 13,330 unvested shares (market value $451,620 each), and 53,330 unearned performance-based shares/rights (payout value $1,806,820)
- Ownership guardrails:
- Stock ownership guideline: 3x base salary for President – Specialty Lines; 5-year compliance window; must retain 50% of after-tax shares until met (100% if not met after 5 years); time-based RSUs count; unearned PSUs/options do not .
- Hedging and pledging prohibited; no margin accounts; short sales banned .
- Clawback policy compliant with Dodd-Frank; recovery of incentive comp for restatements over prior three fiscal years .
Employment Terms
- Role tenure: EVP & President, Specialty Lines & Industry Solutions since Jan 2021 .
- Severance agreements (non-CEO executives): If terminated without cause or resigns for good reason, receive 12 months base salary and 12 months COBRA premiums; contingent on release of claims and compliance with confidentiality/non-solicitation obligations .
- Good reason (non-CEO definitions include): material diminution of duties; >10% base salary reduction without consent; assignment of inconsistent duties without consent .
- Change-in-control (CIC) treatment: No automatic single-trigger vesting; equity acceleration requires qualifying termination in connection with CIC; no 280G excise tax gross-ups (CEO has “best-net” provision only) .
- Potential payments (as of 12/31/2024, SKWD closing price $50.54):
| Scenario | Cash Severance ($) | Pro-Rated Target Bonus ($) | Performance Units Acceleration ($) | Equity Awards Acceleration ($) | Total ($) |
|---|---|---|---|---|---|
| Involuntary or Good Reason (Pre-CIC) | 500,000 | — | — | — | 500,000 |
| Involuntary or Good Reason (In Connection with CIC) | 500,000 | — | 66,700 | 4,866,724 | 5,433,424 |
| Death or Disability | — | — | 66,700 | 4,866,724 | 4,933,424 |
Company Performance (for Pay-for-Performance context)
| Metric ($USD) | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenues | 646,910,000* | 878,899,000* | 1,134,884,000* |
| EBITDA | 60,287,000* | 124,017,000* | 165,593,000* |
| Net Income | 39,396,000* | 85,984,000* | 118,828,000* |
Values retrieved from S&P Global.*
Compensation Structure Analysis
- Mix shift: 2024 compensation for Burkhart emphasizes variable pay; STIP paid at maximum ($450k) with additional RSU/PSU grants sized to 2026 vesting schedule .
- Performance rigor: PSU metrics split between operating profitability (CR) and capital value creation (GBVPS vs peer), capped at 150% and measured over three years .
- Governance safeguards: Clawback policy; no hedging/pledging; no perquisites; no option repricing; no CIC tax gross-ups .
- Severance economics: 1x salary plus COBRA for non-CEO executives; equity acceleration only upon CIC with qualifying termination—supports retention yet limits windfalls .
Risk Indicators & Red Flags
- Pledging/Hedging: Prohibited by policy; no pledged shares disclosed .
- Change-of-control: No single trigger; performance award acceleration only with qualifying termination .
- Related-party transactions: No executive-related transactions above $120,000 since 1/1/2024 (Westaim/Arena Investors ceased ≥5% holder post-May 2024; standard indemnification agreements in place) .
Investment Implications
- Alignment appears strong: 3x salary ownership requirement with mandatory retention, prohibition of hedging/pledging, and robust clawback mitigate agency risk; PSU metrics tied to CR and GBVPS over multi-year horizons should reinforce underwriting discipline and capital accretion .
- Near-term selling pressure windows: Significant vest events cluster around 01/01/2026 (2023 RSUs/PSUs) and 12/31/2026 (2024 PSUs/RSUs), which can create episodic insider sell pressure; monitor Form 4 activity around these dates and any Rule 10b5-1 plans .
- Retention and CIC economics: 1x salary severance and equity acceleration only upon CIC with qualifying termination support retention without excessive entitlements; total CIC exposure for Burkhart estimated at ~$5.43M as of 12/31/2024, driven primarily by equity acceleration .
- Performance backdrop: Strong revenue/EBITDA/net income growth supports pay outcomes; continued outperformance on CR and GBVPS metrics will be pivotal for PSU vesting at or above target (values retrieved from S&P Global) .