CLEARLY, IF EXCESS AND
SURPLUS COULD SPEED UP
THE PROCESS, THEY COULD
ALSO HANDLE A SIGNIFICANT
INCREASE IN BUSINESS VOLUME
RESULTING IN MORE REVENUE.
NEWSPRINT FEEDS through a print press at high speed. If the same kind of automation were brought to excess and surplus lines insurance,
carriers would be able to underwrite more business.
; EXCESS AND SURPLUS
The Need
for Speed
within the excess and surplus value chain itself.
Many carriers, wholesalers and agents handle E&S
manually with little or no automation. From a
process perspective, there are further challenges:
businesses need to be declined for a standard policy
before they qualify for E&S lines and reaching this
verdict can take as long as two weeks.
Revolutionizing excess and surplus lines through automation
would boost transaction volume and open the business to a larger
underwriting universe of small businesses. BY TIM ATTIA
Ask Baby Boomers for an example of automation
that revolutionized their industry and you’ll hear
similar stories touting automation’s benefits—it
saves time and money, it eliminates menial chores
and allows people to focus on what’s most vital to
driving their business.
Those benefits outweigh virtually any pain
associated with implementing or adapting to
automation too. Not one of those baby boomers will
tell you that they miss the good old days of normally
courteous clients and suppliers turning into raving
lunatics after being on hold, playing phone tag for
an eternity, or drowning in a sea of mail and paper.
Insurance carriers are joining the online
automation bandwagon allowing business owners
and risk managers access to the technology-powered
tools they need to get suitable coverage through
online direct-to-consumer platforms such as the
BOLT Insurance Agency ( www.boltinsurance.com).
Features like real-time quoting and quote
comparisons enables businesses to find the right
policy as quickly and easily as most globetrotters
can find an appropriate last-minute trip to Rio on a
site like Expedia or Kayak.
THE SHIFTING E&S MARKET
Addressing the automation void has been a
big concern as commercial carriers prepare for a
change in the U.S. market cycle. In a soft market
where standard lines have a bigger appetite for
underwriting, excess and surplus lines take a smaller
piece of the pie. As the market hardens, the big
question arises:;without automation, will excess
and surplus lines be able to profitably meet the
overwhelming volume of work as standard lines
become more selective about the policies they write?
There’s a growing potential market for E&S
in successful small businesses, particularly
among start-ups with unique needs. The majority
of flourishing small businesses are happy to
reduce their business risk if they have access to
inexpensive insurance coverage.
The challenge here is that most small
businesses aren’t well educated enough about
insurance to determine how they can get the
Summary
THE E&S VALUE CHAIN
• The process of binding an excess and surplus policy
can take as long as four to five weeks.
• Minimum premium amounts and the lack of
incentives for the excess and surplus lines industry
to invest in technology, make it unprofitable to chase
small business risks.
