A wholesale insurance broker is a broker who is licensed to provide specialized insurance products to retail brokers and agents. It is the purpose of the wholesale insurance broker to provide their expertise to their clients. So as to differentiate these professionals from other brokers, the term wholesale is normally added. 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 other function undertaken by the professionals is underwriting special and hard to place insurers. One type of a wholesale broker is a tenant risk wholesale broker. The function of such of the brokers is also to place both admitted and surplus lines professional liability insurance.
Retail agents depend on the wholesale insurance traders to provide their expertise for specialized accounts and also help develop proposals for the insurance. The brokers also provide the retail agents with their share of commission which comes from the specialty markets. it is important to know the importance of the wholesale insurance traders. 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. The specialty line markets is driven by the specialization and expertise of the markets. Wholesale insurance brokerage focuses on the specialty 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. Those who identify themselves as the excess and surplus line category are also known as the non- admitted. The surplus line market is very important to the wholesale brokerage. This is due to the fact that clients benefit from it through availability and customization of specialty insurance.
The process involved in placing a business in the standard is similar to the one involved when seeking the services of a wholesale insurance broker. 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. 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.