Specialist Wholesale Brokers
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General is no longer the modus operandi of the insurance industry, as specialist brokers are now the key players.
“[Buyers’] knowledge is growing,” explains Mark Lange, chief strategy officer at Arch Insurance North America. “The access to information on the internet – the research they can do themselves – gives them a lot more information than they had in the past. Therefore, it’s requiring those brokers to have a higher level of knowledge about the business and be able to provide clients with solutions that really address the needs of the specific insurance.”
Meeting those high standards are the 2023 IBA Top Specialist Brokers winners, but one in particular marks them out as worthy of the title, which is how much of their book is in a niche.
Lange adds, “If it’s a very high percentage, you would suggest that they’ve really built a depth of understanding; they’ve built a depth of contacts, networks and knowledge.”
“With the workers’ comp rates declining, we’re losing premium. That’s a concern. But, again, there’s always going to be new ideas and new problems to solve, and there will always be new brokers with new products to solve these issues”
Steve Love, SolePro
Experts in their fields
Measuring up impressively to the described metrics is winner Lindsay Dress, executive vice president at RT Specialty – Dallas. Over the past few years, Dress has structured her team to include brokers specializing in niches, so they are able to keep up with the trends and appetites of their trading partners. “This allows us to keep our finger on the pulse of each respective line or occupancy for our clients,” she explains.
Dress is focused on property. She characterizes market conditions as “hectic and predictably unpredictable” but also full of opportunity. Underwriting changes and reductions in capital and capacity make for an exciting time in the space, in her view.
“We’d love to differentiate ourselves by being transparent and overly communicative with our trading partners, providing as much possible lead time and preparation for clients,” Dress adds. “Things are chaotic, and the stakes are high, but with that also comes huge opportunity for those who are willing to really put their noses to the grindstone. So, we welcome the challenges ahead and are buckled in and ready for the ride.”
Another winner is Steve Love, the founder and chief executive officer of SolePro, which creates platforms for workers’ compensation accounts. The platforms, often integrated with key carriers, enable application submissions, signing, binding, service and renewal in one central place online.
Love emphasizes how offering a bespoke approach has allowed him to prosper.
“Our little Solo X program is workers’ comp for one person who excludes themselves from coverage; it’s combined with an accident policy that provides some coverage for them,” he says. “It’s a unique product that solves unique needs.”
The person who nominated Love for the IBA award, Hannah Sullivan, the head of growth at SolePro, says, “A top specialist wholesale broker should be an expert in a niche market, which is exactly what Steve is.”
Rikki Concannon, area vice president for Ascinsure Specialty Risk, a Risk Placement Services (RPS) Company that specializes in scaffold and construction access insurance, is another winner. She espouses the need to build a network to thrive as a specialist.
“With growth comes its own challenges,” she says. “So, our main challenge in 2022 was cultivating the right relationships and reaching the right audience.” They leveraged their customer relationship management platform to find prospective agencies and target audiences. “We were just going through and cleaning up all the empty filler space and just reaching out to the right people for the right connections,” she adds.
“[Buyers’] knowledge is growing. The access to information on the internet – the research they can do themselves – gives them a lot more information than they had in the past”
Mark Lange, Arch Insurance North America
While being connected and immersed in a niche can pay dividends, it similarly leaves brokers vulnerable to what transpires in their area of interest.
For example, Dress recounts complex developments in property.
“With the accelerating hardening of the market, especially in the catastrophe-exposed marketplace, and continued public adjuster involvement, markets that generally participate in catastrophe-exposed business have reduced participation and are sometimes pulling out of the space all together,” she says. “MGUs that were providing large ground-up limits and coastal Texas regions for some public entity businesses that we placed have exited the market entirely due to unexpected losses, creep and unfavorable results.”
Discussing how she managed to counter changing conditions, Dress explains, “I had to get creative to provide a placement with large limits to cover very concentrated values. In the final hour, a large amount of capacity had to be replaced due to market conditions. So, with my team, strong carrier relationships and our volume in the marketplace, we were able to leverage replacement capacity to make the program complete with time to spare.”
Love, however, had to face a different challenge. Being in workers’ compensation since he was 23, Love has close to 40 years of experience in the field and is highly motivated to make SolePro a success story. Last year, the small shop wrote around 4,000 policies despite significant staffing challenges.
“We had a number of people out for a lengthy period of time – up to 10 weeks at a time and in multiples,” he says. “It was terrible.” Undaunted, they eventually reached a place where they could hire more people and decided to hand off some work to third-party back-office service providers. “It was our big challenge,” he adds.
Concannon sums up what her fellow winners are saying but reveals how her approach is to provide proof of being a trusted partner for the long term in a particular niche.
“I think the adage, ‘Give value. Give value. Give value. And then ask for business’ stands for a reason. Also, if you partner with customers, when the chips are down and you’re looking for a solution, you can kind of help them in the right direction.”
Opening up on what her plans are for the next 12 months as a specialist broker, Concannon says, “I do see the consolidation aspect more so on the M&A [mergers and acquisitions] side for brokers, especially going into this challenging financial environment. I’m just keeping an eye on who is looking to grow by acquisition and where our customers are going to land. Those types of things have been more interesting to see, and I think that’s going to continue at least into Q3 of this year.”
“I think the adage, ‘Give value. Give value. Give value. And then ask for business’ stands for a reason”
Rikki Concannon, Ascinsure Specialty Risk, a Risk Placement Services (RPS) Company
Flying the flag
As specialization has become more integral, the true specialists, such as IBA’s winners, are having to think of ways to mark themselves out from the generalists.
Lange says, “I think one of the difficulties right now for specialist brokers is how to really articulate and demonstrate their specialization and the special skills that they have, because again, I think it’s one of those things that buyers are demanding and brokers are doing. But again, they’re doing it in so many different ways. So, how they’re able to really demonstrate their differentiation, I think, is a challenge.”
This is an issue encountered by Dress, as the property sector is at the mercy of domestic macro-economic conditions such as inflation, climate change, unpredictable weather events, supply chain issues, labor shortages, and capital and capacity shortages.
Dress explains, “To get the best results in our space for our clients, you have to be creative, experienced and innovative with your broker team at the helm.”
Similarly navigating tricky conditions is Love, who, as a wholesaler, sees mergers as a primary threat. “The agents are consolidating. The wholesalers are being purchased; they’re buying everyone up.
“And with the workers’ comp rates declining, we’re losing premium. That’s a concern. But, again, there’s always going to be new ideas and new problems to solve, and there will always be new brokers with new products to solve these issues,” he says.
“Things are chaotic, and the stakes are high, but with that also comes huge opportunity for those who are willing to really put their noses to the grindstone”
Lindsay Dress, RT Specialty – Dallas