The market is hard. Real hard. Like a rock. The worst we’ve ever seen, or at least the worst I’ve seen in my 23 years in this business.
How do you handle it? Well, there are lots of things you need to do. But for the sake of making it less overwhelming, I would like to focus on one thing and one thing only.
A Remarketing Plan.
In this market when you are dealing with an abundance of non-renewals, it is critical that you have a game plan for what you’re going to do. You need to have a Remarketing Plan in place.
How do you go about doing that?
Good question. I’ll attempt to help.
1) Write it out
Your Remarketing Plan should be written out. It should describe what you are going to do for the various scenarios that you might find yourself having to deal with.
2) Make it accessible
The plan should be stored in a central place where everyone in the agency can access it. In my agency, we put our plans in Microsoft Word docs and store them in a shared folder in OneDrive. There are other ways to do it, such as shared note-taking apps like OneNote or Evernote. But I like Word docs and folders because everyone is familiar with them, no matter how unfamiliar with technology they are. Plus, a Word doc is easy to print if you ever need to. Also, I highly advise putting them in a cloud-based system so they’re backed up in case of emergencies. As mentioned, we use OneDrive, part of Microsoft365, but there are others, like Google, Dropbox, etc.
3) List your carrier sequence
Your Remarketing Plan should provide a sequence for which carriers you’re going to approach when remarketing a policy, and in what order.
Here’s our sequence, which we’ll call the Quoting Process:
1. Quote carriers we’re directly appointment with that allow quoting through Appulate. (What is Appulate? It’s a program that takes data from HawkSoft, then puts it in Appulate, then floods it over to carrier websites when you initiate the quote within Appulate. It’s a massive time saver).
2. Quote carriers we’re directly appointed with that don’t quote through Appulate individually through their websites.
3. Send email submissions to carriers we’re directly appointed with that don’t quote online.
4. Quote carriers we’re not directly appointed with that don’t quote through Appulate individually through wholesalers’ websites (like RT Connector and BTIS).
5. Send email submissions to wholesalers / general agents (send to your favorite broker first!).
This may seem like a long and cumbersome process, but it actually saves time for a few reasons:
It prevents you from overlooking anything
A set process prevents you from accidentally skipping over that one market that you didn’t think would be competitive, which kept it open for some other thirsty agent who quoted, presented, and made you look silly as you hemmed and hawed about how it was some oversight or injustice that you didn’t quote that carrier first while sheepishly asking your client to BOR it over to you.
It prevents you from blocking yourself
This might happen when you send your submission to a wholesaler (Steps 4 and 5) before quoting all your directly appointed carriers (Steps 1-3). If you go to a wholesaler first and they present a quote with a carrier you have a direct appointment with – you blocked yourself! And you may not be able to get it back either. We’ve learned this the hard way. There is nothing worse than getting less commission on a policy that’s more cumbersome to service.
It saves time
With all those steps, how is that possible? Because when you simply follow a consistent repeatable process, you get your apps out to all your carriers/wholesalers without having to put in the mental energy trying to guess – one at a time – which carrier would be the best fit. Without a process, it is a guessing game.
Many agents try to “save time” by only sending their submission to that one carrier they think (hope) might say yes, at the most competitive price (fingers crossed!). They end up waiting for two weeks for said carrier to finally get back to them only to find out they’re either uncompetitive or it’s a decline. This poor agent is now stuck having to decide on the next carrier to approach, and now everyone’s getting worried because the expiration date is two weeks closer.
And what happens when Carrier B is also not competitive or a decline? More frantic mental labor trying to guess what the next carrier should be. Now it’s a rush, need-it-now, my-emergency-your-problem situation, which no one on either side wants to be in. Avoid all gambling and follow your thorough, predictable, repeatable Remarketing Plan’s process without all the decision fatigue.
4) Determine a process for multi-line accounts
A multi-policy account getting non-renewed can get remarketed in many different ways. You may not be able to remarket all lines of business from one carrier to another. We’ve had accounts that were previously placed with one carrier get fragmented out into at least seven different carriers each insuring a separate line of business and/or location (or auto, or portion of the operation). Your Remarketing Plan should determine which lines of business you’re going to approach each carrier with, using the same order above.
Here’s the process we use, which we’ll call the Multi-Line Process:
1. See if the non-renewing carrier is willing to renew any portion of the account if you eliminate the Problem Exposure(s).
2. Remarket the entire account to carriers that might be willing to insure the entire account.
3. Remarket the Problem Exposure(s) separately as needed.
How does this look in real life? Let’s say you have a five-location Lessors Risk Only (LRO) with a Commercial Auto and Umbrella all on one account with a single carrier – the Incumbent. The Incumbent decides to non-renew the entire account because of location five (Loc 5), which is now determined to be in a Wildfire Zone.
Step 1: Go back to the Incumbent and ask if they would still be willing to renew locations one through four (Loc 1-4) + Auto + Umbrella if you remove Loc 5 and find coverage elsewhere. Let’s say the Incumbent counters that that they will be willing to continue insuring Loc 1 – 4 + Umbrella, however, they won’t be willing to extend the Umbrella over any other carrier’s policy and they don’t have an appetite for Auto anymore.
Not bad. Most exposures will renew, which reduces your mandatory remarketing work. At minimum you’ll have to find a new home for Loc 5, Excess over Loc 5, and Auto. But you know that the ideal situation is a single carrier for all lines, so you’re still going to see what else is out there.
Step 2: Send the application for the entire account to your other carriers using the Quoting Process above. If they decline the entire account based on a singular unfavorable Problem Exposure like the Incumbent did, ask them the same question you asked the Incumbent in Step 1 and see what they’d be willing to insure.
Step 3: Remarket Loc 5 as a standalone LRO + Umbrella as well as the Auto to your carriers using the Quoting Process. In this step you may end up quoting other Problem Exposures that any other multi-line carriers refused to quote. For example, if Carrier B is willing to insure everything except Loc 3, you’d start a Quoting Process for Loc 3. If necessary, you might have to continue fragmenting out all the exposures into separate policies among different carriers. For example, Loc 5 may not fit on a BOP, so you may have to separate the CGL from the Property, each line of business being quoted using the Quoting Process.
In the end, you may end up with a complex arrangement like this:
- Loc 1 – 4 + Umbrella retained with incumbent carrier
- Loc 5 Property with the Fair Plan
- Loc 5 CGL with an admitted carrier
- Commercial Auto with a separate standalone carrier
- Excess over Loc 5 + Auto with a separate standalone carrier
It’s not pretty, but at least you have coverage!
5) Document your quoting results in a systematic, consistent way
You can use a piece of paper, a Word doc, or an Excel spreadsheet, but I recommend using the Submission Tracking feature in HawkSoft. It’s a great feature and is essentially a fancy spreadsheet within HawkSoft. It is centrally located so everyone can see it, it connects to your attachments so you can easily pull up a copy of the quote, and it stays forever, so you can use it to build your expertise for future similar situations.
Example of how Submission Tracking looks in HawkSoft:
The highest function of HawkSoft Submission Tracking, in my opinion, is it allows you to quickly and easily describe where you are in your Remarketing Process when your worried client calls and checks up on their status. Nothing shows them you are on it better than when you can instantaneously look at an up-to-date Submissions tab and tell your client where you’re at and what to expect. This builds trust and reduces the chance that they’ll start calling other brokers.
Another tip is that if you’re looking at remarketing a multi-line account as described in the Multi-Line Process, you should create different submissions for each potential option, such as:
- Entire Package
- Entire Package less Loc 5
- LRO Loc 5 + Umbrella Only
- LRO Loc 5 Only
- Loc 5 Umbrella Only
- Auto Only
Stick it to the hard market
Yes, a Remarketing Plan is hard and tedious, and at times may seem unfair, but what else can we do? Wish the market were different? Give up and become life agents? I’ve heard that hard markets lasts 5-7 years. If that’s true, I think we have a couple more years to go. But I’m no predicter of markets. Regardless, the beauty of a Remarketing Plan is it’s good for all types of markets and also for quoting new business. In fact, that’s where this system for my agency developed. Good luck out there and Godspeed. Let me know if you have any questions.
Author
Eli Gillespie, CIC, AFIS
Gillespie Insurance Services
Redlands, CA