Wholesale brokers: Insuring challenging markets

Patrick Martin, Head of Kerry London Underwriting (KLU), discusses the value of using an experienced wholesale broker.

Wholesale insurance brokers are a powerful ally for retail brokers dealing with challenging markets or difficult-to-place risks. Most wholesalers have access to specialty or niche insurances via the Lloyds of London insurance market, one of the world’s leading centres for complex commercial and specialty risks, controlling more than £68 billion in gross written premium (GWP). This enables them to insure areas considered too risky by traditional composite insurers.

An experienced wholesaler will also provide invaluable insight regarding the impact of legislative or other changes in a particular market and cover. They also highlight uninsured risks and will be able to advise on covers such as cyber, bonds, or trade credit insurance.

Good quality service: What to look out for?

Choosing a broker with in-house underwriting capabilities will ensure faster turnaround times for your clients. A broker with in-house underwriters will have developed a thorough understanding of the kind of information insurers are looking for and generally have the capability to transact quotes faster than those without. This is an important consideration, particularly when insuring a high-risk business. The broker will effectively underwrite the business before handing it over to the insurer, therefore streamlining the process and providing an accurate quote.

Patrick Martin said “A good wholesale broker advises on sums insured, limits and business interruption periods, and supply chain disruption to avoid underinsurance and gaps in cover. They also ensure a client is not paying for unnecessary cover. Post-sale, they continue performing valuable day-to-day services, monitoring the suitability of cover limits and policy terms as market conditions fluctuate.”

Key underwriting information to help streamline a successful insurance quote:

1. Provide a complete claims history: Insurers will only quote based on a full claims history. Evidence of good risk management is equally important and may secure a more competitive quote.

2. Trading experience: Provide details regarding how long the client’s company has been established. If a company is new or has been trading for less than five years, insurers may ask them to provide information regarding previous trading experience.

3. Health & Safety measures: Evidence of health and safety procedures is vitally important, particularly for those wishing to insure high-risk trades such as underground depth work.

4. Business declined: Wholesale brokers need to know whether insurers have already declined a risk to ensure they do not waste valuable time approaching the same firms. Most wholesale brokers are aware of the risk appetite of the insurers they work with, but circumstances may change, so letting them know could result in a faster quote for clients.

5. Provide essential insurance details: It sounds obvious but providing the client’s full contact details from the start is vital.

Patrick Martin said, “Working with an intermediary that has the capacity to place high-risk business can help support both new business growth and customer retention without the additional cost of accommodating those risks in-house. This ability to place high-risk business also enables retail brokers to benefit from their relationships and buying power. ”

KLU is a construction expert and places a broad range of niche and hazardous risks including demolition, rights to light, roofing projects, structural steel schemes, green zone railway work to cyber insurance, film completion bonds, and insurance protection for sports professionals. The experienced KLU team has built up relationships with a panel of insurers that trust the in-house underwriting team to deliver the necessary information required to insure these wide-ranging risks.

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