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 added so as to show that these professionals offer their services to the other retail agents and brokers. The wholesale traders do not therefore deal with clients seeking insurance services. In most cases the specialty insurers only deal with the wholesale brokers. Retail agents and brokers cannot be able to access specialty insurers directly. 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. The Wholesale insurance traders also have an obligation of providing the retail agents with their share of the commission received from the specialty markets. One of the question that arise is the importance of having the wholesale brokers. 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. 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. One of the crucial aspects of the wholesale insurance brokerage is the surplus line market. This is due to the fact that clients benefit from it through availability and customization 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 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 stage involves a review of the submitted information by wholesale trader. The wholesale trader then makes an analysis of the risk and tries to identify a potential market. The next sage is usually the presentation of the account for consideration.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.