Retailers, Wholesalers Face ‘Triage’ in Submissions; Relationships Key, ‘Peak Performance’ Attendees

April 8, 2002

Brokers, agents and underwriters alike are learning a new way to do business in the hard market, which has meant getting back to basics with more complete and professional submissions as well as better communications between carriers and producers. And many are facing these challenges for the first time, speakers agreed at the annual Peak Performance Conference for wholesalers and retailers in Laguna Hills, Calif., hosted by ProgramBusiness.com and Fries & Fries Consulting.

“Triage” is how one excess and surplus lines carrier executive described underwriters’ approach to submissions from retailers or wholesalers in a hard market. Larry Ray, senior vice president, of Gulf Insurance, said underwriters typically look to answer key questions such as: Do I know this agent? Does the submission look professional? Does the cover note tell me what I need to know? Is the submission complete?

Agents and brokers should understand the underwriter’s appetite before submitting business, Ray said. “Not wasting your time or the underwriter’s time is crucial in this marketplace. Speaking with the underwriter and connecting about what is needed ahead of time is important. Bottom line, a complete submission will get their attention vs. one that has second and third-generation photocopies attached.”

Ray added that “being careful how hard you push in this marketplace is important, so try and recognize when your welcome is running out.”

The industry is in a learning curve among retailers, insurance carriers, wholesalers/MGAs and reinsurers, said Bruce Coates with Westport. “Many professionals in the supply chain are new to a hard market and everyone is being educated during the course of selling, submitting and binding business,” he said. “The effects of September 11 have dramatically accelerated change in price and strict underwriting that were inevitable due to certain habits of all the players in the last 10 years.”

Larry Neilson, CEO of National Marketing Services, observed the frantic pace around new business submissions and last-minute renewals. “This confirms the disconnect between retailers, carriers, wholesalers and reinsurers,” he commented.

“It’s apparent that all the players in the supply chain of the property/casualty industry are in the beginning of an educational process,” Neilson said. “Many new agency owners who have taken over their fathers’ agencies or were hired out of college never have experienced a hard market.”

Added Jack Fries, principal of Fries & Fries Consulting: “The importance of strengthening the relationship with your carriers in today’s marketplace is analogous to calling plays in a huddle during a football game. The objective is to always get a touchdown. In the ever-changing marketplace the plays can change quickly, which means your short and long-term plans must change.”

Jack McMahan, CEO of insurance customer relationship management (CRM) firm Baetis, Inc., talked about the importance of understanding business customers’ business needs not solely insurance needs. “Your customers aren’t customers. They are people,” he said.

McMahan said agencies must examine customer data (profiling), segment customers (differentiation), and determine what critical information is missing from a client.

For example, he pointed out, many agencies might not even be aware that certain accounts are either generating decent revenue or have the potential to. “Many agencies are confused or define CRM as technology, when in fact CRM is a business strategy not a technology,” he said. “Data enrichment is critical to understanding your customer.”

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