Wholesale insurance brokers can be defined as agencies providing products of insurance that are specialized to both the retail and and agent brokers. The main functions of the wholesale insurance broker is to provide is to provide specialized expert. The term wholesale is usually added so as to show that these professionals offer their services to the other retail agents and brokers. They therefore do not offer services directly to those who are insured. Specialty insurers are usually approached by the wholesale brokers. 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. Both the admitted and the surplus line depend on wholesale brokers to be placed.
Retail agents depend on the wholesale insurance traders to provide their expertise for specialized accounts and also help develop proposals for the 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.
Wholesale brokers specialize in the making placements of unique or difficult accounts to the markets that specialize in writing such accounts. Commercial insurance brokers obtain their specialization by dealing with the specialty markets. Wholesale insurance brokerage focuses on the specialty markets. The specialty line markets are composed of both the admitted insurers and the excess and surplus line insurers (E&S). The excess and surplus line insurers are also known as the non admitted. In the wholesale brokerage, the surplus line market is very key. 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. The process however involves several procedures. The first step is usually to submit an account to the broker. The submission of the account is usually done together with provision of other necessary information that required. The second step involves the wholesale broker utilizing their expertise to review the submitted information. After the broker has done the review they try identify a possible market. The next sage is usually the presentation of the account for consideration.Each of the requested underwriter then responds with an acceptance or decline. Once the account has received bids, it is returned to the retail agent who then guides their client.