Generally speaking, independent insurance agents and brokers work with many clients across a broad spectrum of industries. Many of these classes of business are niche markets that require an agent and broker to partner with a specialist who brings a number of important attributes to the table: depth and breadth of underwriting expertise and experience to understand an operation’s exposure and what is required to address each exposure, the ability to tailor an insurance program with specialty products and enhancements to fit individual business needs, longstanding relationships with stable insurance markets committed to the space, and the team in place to provide responsive quoting, servicing and claims management.
These specialists are Program Administrators and Managing General Agencies (MGAs) whose focus is primarily in specific verticals. They have spent years learning the ins and outs of an industry or niche market and its challenges, developing programs that will fit the industry’s risk profile, and cultivating carrier relationships to meet the demands of customers as well as address emerging risks as they arise.
When an agent or broker goes to market for an account, with a Program Administrator or MGA, he or she already knows that the specialist has an appetite for his or her specific niche with programs and products that will fit the clients’ needs. With wholesale generalists, many of the carriers they will reach out to on behalf of the agent/broker may not write the business or haven’t had much experience in the industry.
In addition, often a Program Administrator or MGA “holds the underwriting pen” for its programs and can underwrite, rate, quote, bind, issue and service policies on behalf of the carrier. This is a huge advantage for agents and brokers looking to respond to their clients as quickly as possible, especially in light of today’s “Insurtech” world where on-demand quotes for an increasing number of industries and insurance products are available. Having underwriting authority also signals the carrier’s confidence in the MGA or Program Administrator. It’s critical in any program that there is underwriting profitability in order for it to remain sustainable in the long-term. An agent or broker knows that the specialist has skin in the game and is dedicated to the niche industries it writes.
Some Program Administrators and MGAs also provide loss control and risk management services in partnership with their contracted dedicated carriers, offering agents the added value of being able to help clients mitigate their exposures and improve their risk profile.
Also, as the majority of Program Administrators and MGAs are small to midsize businesses (vs a carrier), similar to their retail partners, they understand the issues that insurance agencies face day-to-day. This allows them to be nimble and flexible, again offering the responsiveness in quoting and binding coverage and servicing that larger insurance companies with multiple layers of management have problems providing.
In working with Program Administrators or MGAs, retail agents and brokers should consider several things: How long have they been writing each class of business? Who is/are the carrier(s) behind the program and/or products? What is each carrier’s rating? Look at their website to get a good idea of the extent and scope of their knowledge and experience. Talk to other agents and brokers who work with them. Check out if they have been endorsed by any of their specialty classes’ industry associations. Also, just pick up the phone and speak to them in order to get a feel for their expertise and experience.
As a national specialty underwriting and Program Administrator, Manchester Specialty Programs provides a total business insurance solution for home care, allied health and human services. It’s all we do. For more information about how we can help you protect your insureds, please contact us at 855.972.9399. If you are interested in becoming a partner with us, just click here.