Whole sale insurance brokers are people or agencies who are licensed to offer specialized insurance products to retail agents and brokers. The main functions of the wholesale insurance broker is to provide is to provide specialized expert. The term wholesale is usually included to show that the wholesale broker offers services to other brokers and retail agents. The wholesale traders do not therefore deal with clients seeking insurance services. A wholesale broker is also able to utilize specialty insurers. The retail agents cannot be able to utilize the specialty insurers. The special and hard to place insurance are also dealt with by the wholesale insurance brokers. One type of a wholesale broker is a tenant risk wholesale broker. In order to be placed, both the surplus line professional liability insurance and the admitted depend on the commercial insurance brokers for placement.
For retail agents, they should expect wholesale brokers to provide the expertise for the specialized accounts and proposals for insurance. They are also the ones to provide a share of the commission received from the specialty markets. Getting to know why the wholesale insurance traders are needed is important. The answer to the question is that the traders offer expertise.
One of the unique functions of the wholesale insurance brokers is that they make placements of unique or difficult accounts to the markets that have specialized in such accounts. Commercial insurance brokers obtain their specialization by dealing with the specialty markets. It is important to note that the wholesale brokerage operates in the specialty line markets. Admitted insurers and the excess and surplus line insurers (E&S) are the two types of insurers allowed to operate in the specialty line markets. The excess and surplus line insurers are also known as the non admitted. The surplus line market is very important to the wholesale brokerage. This is because it benefits the clients through customization and availability of specialty insurance.
With a wholesale brokerage, the process of placing a business is similar to the process that is applied when placing a business in the standard markets. various procedures are involved in the process. The first stage of the process is usually to provide an account to the wholesale broker. The submission of the account is usually done together with provision of other necessary information that required. A wholesale trader then reviews the information for correctness. They also make an analysis of the risks and identify a potential market. A third step involves presentation of the of the account in each market for consideration and underwriting.Each underwriter is then required to respond with a request for more information or a decline. If accepted, the wholesale broker presents the proposal to the retail agent who then works with the client to understand the proposals and determine the most suitable option to bind.