Write quality, profitable business in soft and hard markets alike.
I was speaking with a broker several weeks ago about the importance of providing underwriters with complete information. Believe it or not, many carriers lack full underwriting files on accounts that they’ve insured for several years! When a home office underwriter reviews a file, it isn’t complete and the renewal process stalls.
This broker made an interesting observation: “We tried providing our carriers with full information and it created problems,” he said. “We found that the more information we provided, the more confused the underwriter became. And then they ultimately declined the renewal!”
A Lloyd’s underwriter makes a decision to commit capacity based on a two-page written document and the London broker’s ability to explain the risk succinctly. This is a streamlined process based on integrity, account knowledge, and anticipation of underwriting appetites.
As a broker, you face the responsibility of making two sales. The first is to the carrier, and the second is to your client or prospect. Here are some thoughts on the lost art of broking to your underwriter.
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Boil it down. As a professional, you should be able to take any account and summarize it in less than two pages. These pages should contain key underwriting loss ratio results by line, a compilation of underwriting data (payroll, receipts, etc.), prior premiums, and key client financial ratios.
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Include a narrative. Your two-page account summary must include a narrative description of the key issues the client is facing. Some agent/brokers find this difficult because they don’t know the issues.
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Anticipate questions. The narrative must describe your account forthrightly and anticipate an underwriter’s concerns. Astute underwriters will interpret your ability to anticipate questions as a sign of competence. After all, if you don’t know the questions, you won’t have the answers.
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Prepare to hold the underwriter’s hands. There’s nothing more frustrating than preparing a quality presentation, then having it picked apart by frontline underwriters. The quality of your information must be the vehicle by which you constantly refocus their concerns. It’s the only way you can keep all eyes on the big issues rather than the minutiae.
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Pre-Select Your Underwriters. Never submit an account to the marketplace without knowing in advance the underwriter’s appetite for the risk. Have a brief dialogue with all potential underwriters to save time for you and for them. Failure to do this will create a great deal of wheel spinning.
CONCLUSION
In soft and hard markets alike, Consultative Brokers who understand the “Art of Broking” will weather the gale. In fact, these producers will flourish as their competition flounders. By implementing the principles of skillful broking, you can write a number of quality, profitable accounts.