Sponsored by Pathpoint
Since 2017, Excess & Surplus lines Gross Written Premium in the U.S. has quadrupled, with another year of 20%+ growth on the horizon. The overall U.S. Property & Casualty market has also grown, but E&S has handily outpaced it, and makes up an increasingly large share of P&C — a share that will last as more risks structurally move into E&S. Despite this new normal, E&S placement processes haven’t kept up, and aren’t prepared for the coming influx of risks and agents either.
Existing Solutions Fail Agents
Any P&C agent placing E&S business knows the huge gap between admitted and non-admitted experiences. E&S business is typically placed through wholesale brokers, a system designed to handle large commercial accounts that has not innovated in a number of years. Agents wait days or weeks for quotes as they manage endless back and forth between themselves, the insured, carriers, and the wholesaler. The current standard of waiting days or weeks is not practical for smaller premium artisan risks, where the end result is that writing small commercial E&S is both time consuming and frequently unprofitable.
Placing Blame
To be sure, risks that fall into E&S present more complexity than those hitting the standard market, and are accompanied by a highly variable web of state regulations, taxes, and filing fees. Does E&S have to be this complicated and painful? The standard explanation is that all E&S risks are so varied and complex that only long-lasting relationships can get them across the line.
Meeting the Challenge
What if, instead, agents could place business in the time it takes to read this article? This starts with challenging status quo assumptions about E&S complexity. By policy count, the E&S challenge is almost always a market-matching issue (who will write trampoline park GL?), which lends itself to a technology solution. Routing risks, and underwriting guidelines themselves, clearly map to algorithmic systems that can power digital placement solutions that are faster, simpler, and easier to navigate for agents and carriers alike.
While specialists can continue to handle uniquely difficult risks, a strong marketplace can make matching carriers to most risks entirely available online.
A New Way of Doing Business
If we accept accessing E&S through a digital, highly integrated marketplace, what features come first?
- 24/7, self-service solutions available on the agent’s time, not the broker’s
- Instant quoting through carrier APIs. Get a quote to present to your client in minutes, or a declination that allows you to move forward
- One application that eliminates duplicative questions and enables seamless multi-market submissions
- End-to-end e-signing and digital payments — goodbye paper forms, mailing checks, and chasing payment status
- Close collaboration with agents, who know their needs best
This is only the beginning — there are far more features to carry over, and agents should seize the opportunity to not only be a part of existing solutions, but power the future of the industry.