A possible merger of the nation’s two major excess and surplus lines organizations is on track.
The American Association of Managing General Agents (AAMGA) and the National Association of Professional Surplus Lines Offices (NAPSLO) said they are moving forward with previolusly-announced plans to consider merging both organizations into one association and have formed a joint committee to explore the idea.
Both associations state that a possible merger makes sense due to a high percentage of overlap in both memberships. Currently, 77 percent of AAMGA members also belong to NAPSLO and 48 percent of NAPSLO voting members also belong to the AAMGA.
The AAMGA’s voting membership is comprised of 253 (68 percent) wholesale insurance members; and 119 (32 percent) associate members (insurance companies and other risk bearing entities).
NAPSLO’s voting membership is comprised of 370 (77 percent) wholesale broker/agent members; and 108 (23 percent) company/underwriting manager members (insurance companies and other risk bearing entities).
“The synergy of the AAMGA and NAPSLO, together serving the entirety of the wholesale insurance marketplace, is a common sense opportunity neither organization can afford to ignore,” said Ed Levy, AAMGA president, and Dave Leonard, NAPSLO president, in a letter on Oct. 20 to members of the associations.
However, consolidation would take votes of approval from the majority of both association’s members. Approval would need 75 percent of AAMGA members to vote yes on the deal, while two-thirds of NAPSLO members must approve it.
The AAMGA stated in a memo to its members on Nov. 21 that: “If the efforts of the Merger Committee are favorable, membership-wide votes of the AAMGA and NAPSLO will be conducted in mid-2017. An announcement of the Proposal for the membership-wide vote under this scenario would be sent at least 60 days in advance.”
If the merger did occur both associations would consider combining the three existing national conference meetings held by the AAMGA and NAPSLO into two meetings.
“The benefit to members is the reduction in the number of events for a largely congruent group of attendees, which is anticipated to generate significant indirect cost savings (time and travel) for members while providing attendees effective forums focused on both delegated underwriting and transactional brokerage,” the AAMGA stated.
If consolidation is struck down by both memberships, NAPSLO says it “will continue offering top-notch member services in networking, education, talent recruiting and development, and advocacy on behalf of its members.”
The AAMGA would also continue its member services but is exploring other options for the future of the organization in addition to consolidation.
The AAMGA has said it will use Accolade Management Services, located in King of Prussia, Penn., for an executive search to examine staffing the association with employed dedicated staff and an executive director as well as conducting a Request for Proposal (RFP) to identify firms who would provide management services to the AAMGA under contract including an executive director.
AAMGA, an insurance industry membership association established in 1926, represents managing general underwriters, program administrators, aggregators and other wholesale insurance professionals.
NAPSLO, established in 1975, is a national trade association, representing surplus lines insurance agents/brokers, surplus lines insurance companies and associate members comprising the wholesale insurance distribution system.