2. Speed and Flexibility
Speedy and accurate claims handling, flexible underwriting decisions and reliable communications should be a given when working with carriers or MGUs. Unfortunately, there are no guarantees and it is necessary to conduct due diligence when establishing a relationship. A carrier’s mammoth size, for instance, may result in potentially slow claims processing. And while MGUs are smaller and should be more nimble, that isn’t always the case. Choose your MGU wisely by asking for referrals that demonstrate the skills, expertise and responsiveness you want in your relationships.
Competition has commoditized most insurance products, making price a non-issue within many lines. All risks, however, are not the same. Perhaps you have a client with claims experience that is shorter than desirable. Or you have a client with recent poor experience, but no prior history of higher-than-average claims. In these instances, you face the possibility with many major carriers, which operate within strict guidelines, that the insurance your client needs is unaffordable or even unavailable. MGUs are more likely to look outside the box when structuring programs – and in some cases, may be able to customize a program to meet a client’s unusual circumstance. A good MGU will maintain flexibility and look for ways to do business (not ways to avoid business) that work for everyone.
How often have you tried to talk with a decision-maker at a carrier to speed along some business, only to be rebuffed? MGUs focus on personalization, and offer brokers a smaller company vibe with more ownership and accountability. With an MGU, you are more likely to have direct access to underwriting and claims managers without the red tape you might have to maneuver around at a carrier. The right MGU offers a level of transparency and responsiveness your clients deserve.
Because MGUs typically operate with an entrepreneurial spirit, they enjoy working with brokers to understand a client’s entire risk portfolio. Good MGUs will ask lots of questions while looking for real opportunities; they will roll up their sleeves and dig in to truly understand a client’s needs. This holistic approach can open doors to new business – if not with this MGU, then with another MGU or direct through a carrier.
6. Financial Strength
An MGU’s financial strength must play a role in any decision you make, so make sure the MGU you select has a profitable track record. Equally as important are an MGU’s carrier relationships and their insurers’ ratings. While many lines of business may be commoditized, a slightly lower price is worth little if a carrier struggles to maintain decent financial ratings or if loss ratios regularly exceed industry norms.
Add it all up and the right Managing General Underwriter can give you and your clients a level of service that you might not expect from a carrier. In fact, many MGU managers gained their experience working for carriers, but have moved on as they prefer the autonomy and authority MGUs grant them. Taking time to select the right MGU will lead you to a long-term partnership that can benefit both you and your clients. Because good service trumps everything else, the right MGU will understand that relationships matter and are key to keeping clients happy.
Legal Disclaimer. Views expressed here do not constitute legal advice. The information contained herein is for general guidance of matter only and not for the purpose of providing legal advice. Discussion of insurance policy language is descriptive only. Every policy has different policy language. Coverage afforded under any insurance policy issued is subject to individual policy terms and conditions. Please refer to your policy for the actual language.
(c) 2017 AmWINS Group, Inc.
Construction contract negotiations, which determine the kind and amount of insurance required for a construction project, can be time-consuming, complicated and frustrating. Project owners require contractors on a project to name the project owner as an additional insured on the contractor’s casualty insurance program. It's important that both project owners and contractors understand the coverage provided by these additional insured endorsements. This article discusses four common ISO additional insured endorsements related to commercial general liability policies purchased by contractors, including their limitations, conditions and exclusions.
A common complication during the claim process is the late reporting of claims. In some cases, a late claim can put the agent or broker's own E&O policy in jeopardy. There are many reasons for missing a reporting deadline; however, in most cases, they will not matter to the insurer or the courts. This article discusses typical claim reporting requirements, common causes of late reporting, and recommendations to mitigate the risk of late notice claim denials.
The theories of recovery, as well as the ensuing loss provisions, contained in property insurance policies are often complex and, at times, seemingly in conflict. Although a policy may not directly address these theories, their application by courts plays a significant role in the coverage determination process after the claim. It is essential that brokers understand the primary theories of recovery – Efficient Proximate Cause, the Concurrent Causation Doctrine, and the Anti-Concurrent Causation Doctrine – in order to navigate the challenging post-claim process and effectively serve their clients.
The Thomas Fire, the largest fire in California's history, subsequently led to a mudslide on January 9, 2018, which caused a massive amount of damage in Santa Barbara and Ventura counties. The California Insurance Commissioner has issued a formal notice reminding carriers to pay for damage, citing the "efficient proximate cause doctrine." This article takes a closer look at the doctrine and how it has been challenged in court over the years.
Ordinance or Law insurance coverage provides limited protection for costs associated with repairing, rebuilding, or constructing a structure when physical damage to the structure by a covered cause of loss triggers an ordinance or law. Compliance with ordinances and laws after a loss can add 50% or more to the cost of a claim. This article will help you educate your insureds on exclusions and limitations and help them take a proactive approach to their insurance program.
In 2017, the issue of sexual harassment – especially in the workplace – gained greater awareness as accusations of harassment by high-profile individuals were constantly in the news. In many cases, sexual harassment lawsuits seriously impacted businesses and their respective insurers. Employment Practices Liability Insurance not only provides protection against employee lawsuits, but can also help your clients mitigate their sexual harassment risks.