Large insurance groups: Captive retail agents need access to additional carriers

By Andrew Barile

Andrew Barile Consulting Corporation


The recession has negatively impacted thousands of captive retail agents of large insurance groups, like Farmers and Allstate, to name a few. In order for these captive agents to enhance their agency value, they must have access to other insurance carriers that provide additional insurance products.

Strategic initiatives with a national wholesale and/or managing general agency with access to many admitted broker insurance markets (and many excess and surplus lines markets) is the definite way to go.

The wholesale broker/managing general agency that provides the following insurance products for retail captive agents will be successful:
    1. Workers' compensation

    2. Contractors' general liability

    3. Commercial auto

    4. Business owners policy (BOP)

    5. Specialty excess and surplus lines coverage, including various forms of professional liability

    6. Earthquake-only

    7. Difference of conditions (DOC)
The nationally licensed wholesale broker/managing general agency with sophisticated automation and technology, as well as an underwriting culture to interface with the retail captive agent, is key to achieving success.

The managing general agency must have the financial resources to provide:
    1. Reasonable economically beneficial retail brokerage commissions for the captive agent

    2. Training sessions for understanding the above insurance products

    3. Effective technology that makes the transaction user-friendly

    4. The support of senior executive management at the large insurance groups

    5. Access to many "A"- rated excess and surplus lines and admitted insurance carriers (national presence)

    6. Dedicated experienced staff for this additional profit center
The captive retail agent needs this additional commission income from the managing general agency/wholesale brokerage firm to survive in these recessionary times. Give them their profitable opportunity.

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