When Toby Gorman (pictured) was tapped to join Aventum Group’s international broking arm Consilium, he was welcomed for bringing “strong connections in Lloyd’s and other markets, and strong relationships in the MGA and coverholder space”.
Having been a specialist in delegated authority business for over 25 years and held senior roles at Arrow Risk Management, AXIS Capital and Novae, he joined Consilium’s Delegated Risk Solutions (DRS) business as partner in March 2023. Joining the team was a natural next step for him, he said, not least because of the reputation of the DRS team within the Lloyd’s and London markets, its employee-owned and debt-free structure, and entrepreneurial culture.
It’s an interesting time for the coverholder market, which is facing a number of core challenges, including those related to data. There’s no shortage of opportunities for MGAs through innovation and expanding into new markets, he said, but there is a tangible lack of data, which is a real stumbling block when it comes to carriers progressing, making it difficult for new MGAs and startups.
“Coverholders need the capabilities to handle, analyse and action vast amounts of data for improved decisioning if they are to differentiate based on expertise, innovation, and value-added services,” he said. “The complex and ever-evolving global regulatory landscape and compliance costs remain a challenge.
“Coverholders must invest in reducing the administrative burden and improving operational efficiency via automation and digitisation. However, there’s always a flip side of course. With increasing digitisation, coverholders are exposed to cybersecurity threats and must therefore up their game in terms of mitigation and prevention measures.”
When it comes to opportunities, he said, customers desire more user-friendly, comprehensive, and tailored insurance products and MGAs are perfectly placed to lead from the front in delivering them. Coverholders can differentiate by developing innovative insurance products tailored to evolving customer needs and emerging risks, such as cyber insurance for businesses or parametric insurance for natural disasters.
“[In addition], collaborating with insurtechs, reinsurers, and other industry stakeholders can provide coverholders with access to new technologies, distribution channels, and expertise,” he said. “And of course, harnessing the latest advancements in technology, such as artificial intelligence, machine learning, and blockchain [can] offer innovative solutions for improving underwriting accuracy, risk management, and customer experience.”
Identifying some of the critical areas in which MGAs and MGUs require support when navigating the current environment, he noted that these businesses often require support in areas such as technology adoption, data analytics, risk management, compliance, portfolio diversification, and accessing specialised expertise and markets. Getting on the front foot across all these areas can help them navigate the market more effectively and stay ahead of the game.
Support in terms of accessing carrier partnerships, negotiating favourable terms, and diversifying their portfolio, as well as developing innovative insurance products tailored to evolving customer needs and emerging risks is essential to staying competitive, he said.
“This is why DRS has experienced such rapid growth,” he said. “We can provide coverholders with access to A-rated carriers in both the Lloyd’s and London markets. Once capacity is secured, we deploy our deeply experienced technical, digital, and actuarial teams to assist with ongoing profitable binder management, and the tailoring of innovative schemes and facilities that drive growth.
“We’re pushing the technology boundaries, bringing together, for the first time, actuarial insight and global re/insurance expertise in capacity sourcing and binder management. This means we can push even harder on the limits of what’s possible.”
Offering his take on the overall health of the coverholder market, Gorman is “absolutely optimistic” about where it goes next. Despite challenges, he said, there are plenty of opportunities for growth and innovation and with the right strategies and adaptability, the market can continue to thrive and provide valuable insurance solutions.
Several factors contribute to Gorman’s optimism. He highlighted how market growth is presenting opportunities for coverholders to tap into new markets, diversify their portfolio, and expand their business. The pace of innovation is constantly offering exciting new ways to enhance offerings, improve operational efficiency and support growth ambitions, he said, as is an increased willingness to embrace cross-industry strategic partnerships.
“Coverholders are also increasingly focusing on delivering value-added services, personalised experiences, and innovative insurance solutions tailored to customer needs,” he said. “And finally, despite facing challenges such as natural disasters, economic downturns, and global pandemics, the coverholder market has demonstrated resilience and an ability to adapt to changing market conditions, manage risks effectively and innovate in response to emerging trends.
“The future is bright.”
