Looking Back: How Chart Came to Be - and Why It's Working

 

I think it is safe to say that the vast majority of entrepreneurs can be characterized as forward-thinking people. They thrive on achieving the next goal, winning the next big deal, or reaching the next business milestone.

Every once in a while it is a worthwhile exercise to look back at the past and reflect on how we got to where we are now. As the CHART Exchange moves in to its third year of existence, we thought it might be an interesting exercise to think back on how the concept of an organization dedicated to the U.S./ London marketplace came to be.

The genesis of this idea goes back to when we first launched Rockwood Programs. At the time, we were a start-up Managing General Agency owned by a reinsurance brokerage operation. Back in 1998, there was no real forum for likeminded Program Administrators to meet, network, and discuss issues that were important to us. We approached our then employer – E.W. Blanch – with a strategy for obtaining a competitive edge within this unique market niche. Our team even came up with the futuristic-sounding name of BPS2k (Blanch Programs Services 2000).

The plan was simple: form an association of program specialists as a type of best practices group to give EWB a platform to bring in the best carriers, vendors, speakers, workshops, to the specialist programs world. The BPS2k idea was never accepted at Blanch… but became the blueprint for a new group now known as The Target Markets Program Administrators Association (TMPAA).

TMPAA was established in 2001. As far as new launches go, it was the “Perfect Storm”. A group dedicated to supporting the needs of an underserved niche. Member agencies that shared our vision enthusiastically supported it. Insurance carriers and vendor partners that recognized the unique business opportunity. Target Markets eventually outgrew us; at that point we turned it over to another entity better equipped to manage it.

We once again took a look at our own experience to figure out what to do next. Rockwood’s flagship insurance product had always been Employment Practices Liability (EPLI). Yet over the past two decades we had to change our domestic insurance carrier partners five times – and not once was the move initiated by us. The causes were outside of our control: transition in underwriting philosophies, shake-ups in management, shifts in strategic direction, etc.

Now compare that experience with the ones we’ve had with London. In 2004 Rockwood launched a start-up Insurance Agent’s E&O program. Thirteen years later we are still interacting with the same Underwriter (Nick Leighton). He has shown himself to be a steadfast partner. Our partnerships with other London-based initiatives have yielded similar results.

The key objective of the CHART Exchange is to foster growth within the U.S./London marketplace through the identification and pursuit of new business opportunities. To achieve this goal, it is necessary to raise awareness within the domestic insurance agent community regarding the benefits of working with Lloyd’s. Fortunately, we are teachers and love to share our positive experiences.

Here are the messages we strive to convey to those unfamiliar with the London market:

1. Specialize for your long-term value.
The level of expertise you possess regarding a particular product line, target niche, or coverage nuance serves as a key differentiator in the marketplace.

2. Programs are both a science and moving target.
There are some commonalities relating to program business: adherence to underwriting disciplines, proper evaluation of risk characteristics, determination of adequate rate, etc. With that said, the introduction of new exposures, changes in the competitive environment, and other factors combine to make the marketplace very dynamic.

3. Seek expertise, stability, and partnership.
The best new programs are launched collaboratively between an agency who understands the market and an underwriter with the requisite knowledge in risk evaluation. While the best carrier partner may be a domestic insurer, remember that they change philosophies/ strategies often. London is built to do new deals.

“The key objective of the CHART Exchange is to foster growth within the U.S./London marketplace through the identification and pursuit of new business opportunities. To achieve this goal, it is necessary to raise awareness within the domestic insurance agent community regarding the benefits of working with Lloyd’s.“

4. Embrace the concept of surplus lines!
As noted in item #2 above, the marketplace can change in a heartbeat. Writing business on a non-admitted basis allows you to nimbly adapt to the dynamic business environment.

5. Understand the role of the London Broker.
The Broker plays a crucial part of any London-based transaction: serving as the intermediary between the Underwriter and domestic insurance agency, ensuring compliance with Lloyd’s regulations, etc. Also keep in mind that this group might not necessarily be the best source for birthing a new idea.

6. Face-to-face interaction is a proven concept.
It is difficult to establish a long-term business relationship over great distances. Personal meetings between agencies with new program ideas and risk takers can serve to foster trust, resolve outstanding issues, and move concepts forward.

7. The London market doesn’t have to be a mystery.
Many domestic agencies are unfamiliar with Lloyd’s. CHART provides the forum for these producers to become acquainted with the world’s oldest insurance brand.

8. CHART was built on the lessons of program business.
Identify an under-served niche. Understand the target audience. Test the concepts of a new idea like CHART to validate relevance.

- Glenn W. Clark , CPCU
CHART’S Earliest Adopter

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