5-Star Wholesale Brokers and MGAs 2022

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Significant growth through outstanding service

With a unique position between retail brokers and insurers, wholesale brokers and managing general agents (MGAs) play an important role in the insurance distribution model and often help to deliver niche coverage. In this 5-Star Wholesale Brokers and MGAs 2022 report, IBA highlights the best wholesale brokers and MGAs in the country and hopes to inspire others in the industry to strive for similar levels of achievement.

“Systems and processes matter, but we pride ourselves on identifying the best industry talent that will fit into our culture”
Eric Wirkus, XS Brokers

The state of the market

The surplus lines segment has experienced significant growth and momentum over the past several years, according to Brady Kelley, executive director of the Wholesale & Specialty Insurance Association.

“AM Best reported US surplus lines premium of $66.1 billion in 2020, up 17.5% over 2019,” he says. “The 15 states with stamping offices reported premium of $51 billion in 2021, up 22.3% from 2020. These states represented 63% of US surplus lines premium in 2020, so they are a strong overall indicator of the market’s performance nationwide.”

Eric Wirkus, president of XS Brokers and one of the winners, echoes Kelley’s sentiment. He says market conditions have been extremely advantageous for wholesale broker and MGA firms over the past year. “The need for intermediaries in the distribution chain has never been greater, and despite capacity constraints existing at this moment in the hard market cycle, most in the space have reported solid growth in 2021 top line premium written,” he says. “The combination of long overdue soft market conditions ending and major carriers removing themselves partially or entirely from poor performing segments has allowed the remaining participants to capitalize on a healthier rating environment.”

Meanwhile, Jennifer Kessel, marketing director at USG, another winner, emphasizes the resilience of the excess and surplus (E&S) lines segment while recognizing the impact of many considerable headwinds.

“Despite COVID-19, social inflation and increased natural catastrophes throughout the US, we’ve continued to grow and find new solutions to accommodate an ever-evolving marketplace,” she says. “It’s been a tumultuous marketplace that has kept our brokers and retail agents busy – marketing, remarketing and looking for creative solutions on their accounts.”

What are their expectations for the next year? Throughout 2022, Wirkus anticipates similar conditions with an eventual rate leveling toward the end of the year due to traditional or alternative capital flows into the industry. Kessel expects the E&S space to grow significantly with new MGAs, MGUs, and specialized binding authorities forming to address underserved coverages and classes, while Kelley anticipates a continued interest of capital in the segment.

“Our technology was built to save time and make our team’s and partners’ jobs easier”
Jennifer Kessel, USG

How winners are distinguishing themselves

For this report, we surveyed thousands of retail producers and asked them to rate their wholesale broker or MGA partners on a scale of 1 to 5 in the following areas listed in order of greatest importance to the survey participants: overall responsiveness, technical expertise and product knowledge, ability to place niche or emerging risks, range of products, reputation, pricing, compensation, technology and automation, marketing support and geographical reach. We asked Wirkus and Kessel for their thoughts on the categories.

Regarding overall responsiveness, Wirkus says attentiveness and general service quality are key to winning deals and growing relationships, while Kessel recognizes the importance of technology in helping speed up pricing information, updates and marketing progress from initial submission to policy issuance.

For technical expertise and product knowledge, Wirkus says XS Brokers is only as good as its people. “Systems and processes matter, but we pride ourselves on identifying the best industry talent that will fit into our culture. At the end of the day, clients want their problems solved, and we believe it’s our team that makes that happen,” he says.

Then, there’s the ability to place niche or emerging risks. Wirkus says XS Brokers is continually seeking new segments. While in the past, that might have been buildings to insure, in the future, he sees cyber and other newly evolving areas of risk to focus on.

“We’d like to think that as a solutions provider, we can handle any risk a client puts in front of us. We’re extremely proud of the depth of carrier relationships we have on all sides of our business, and it’s our goal to offer terms on any risk deemed eligible for coverage,” says Wirkus about his company’s product range.

Kessel says that people and resources make all the difference when it comes to maintaining a company’s reputation. “Finding qualified, hardworking team members, providing them the support and tools they need and then getting out of their way to let them do what they are best at,” she says. “When you have five-star team members providing exceptional service every day backed with the technology and tools, including market placement options they need, your reputation will always be stellar.”

As for compensation, Wirkus says: “There is value provided on all levels of the distribution chain and our goal is to have financially healthy retail and carrier partners. Our services and expertise should come at a cost, but we’re confident that we are competitively positioned in terms of our compensation to our clients.”

About technology and automation, Kessel says that USG’s systems, both internal and external, are topnotch in the industry. “They were built and updated over the last 18 years to meet the needs of the brokers utilizing them. Our technology was built to save time and make our team’s and partners jobs easier.”

Meanwhile, Wirkus says marketing support remains a top priority for XS Brokers. “Led by our team of business development managers strategically located throughout our regions, outreach and relationship management are delivered via several KPIs that involve the partnership of our underwriting teams,” he says. “We are consistently provided with feedback that we are an industry leader in our marketing efforts and that allows us to better understand the ongoing need of our clients.”

And, lastly, there’s geographical reach. “M&A activity is the theme of the day and that has created, and will continue to create, an expectation that intermediaries be able to provide solutions everywhere,” Wirkus says. “Where our clients are, we endeavor to be as well.”

He believes that many things differentiate his company in the marketplace, but one does not need to look far beyond its corporate motto to see what is most important. “Fiercely committed. Proudly independent. These are two statements that we strive to demonstrate every day in our dealings with our carrier and retail partners, and they provide a cultural tone for all of our team,” he says.

For Kessel, another factor that differentiates USG is its client-focused approach to decision making. “In a marketplace where large nationals are more likely to be publicly traded/owned and decisions are made based on the best interest of the stockholders, we pride ourselves on being privately and family-owned and operated, with the ability to make decisions that are best for our entity and our clients as a whole,” she says.

Other survey insights

The 2022 IBA 5-Star Wholesale Brokers and MGAs survey was rich in data shedding light on the average US producer. Of those surveyed, the highest percentage (60.38%) were specialists. Most (approximately 25%) had deals in the range of $1,000–$4,999 for commercial and E&S deals. When asked what would make them consider another wholesale broker/MGA, the greatest portion (20.06%) said more competitive pricing, followed by better responsiveness (17.75%) and a wider range of products (13.34%).

Most (20.19%) of the respondents were conducting 11%–25% of their business with MGAs, while the greatest portion (29.86%) would reach out to an MGA because they needed coverage of a market they didn’t have access to. Most (49.19%) found their MGAs via referrals, and the largest group (41.42%) “bid out” one or two MGAs during the vetting process.

A large proportion of respondents (19.81%) also said they were unlikely to change wholesale partners in the next 12 months. In addition, the largest percentage (38.86%) said a wholesaler’s affiliation with an owned retail brokerage wouldn’t affect their decision to work with them.

ALL-STARS

Jimcor
Quaker Special Risk
US Risk

Pricing

Appalachian Underwriters
Bass Underwriters
Burns & Wilcox
Cochrane & Co
CRC
FTP
Griffin Underwriters
Hull & Company
Jimcor
Next
Peachtree
Quaker Special Risk
Re Chaix
Scottish American
SIS
Tapco
US Risk
XS Brokers

Technical expertise and product knowledge

Appalachian Underwriters
Bass Underwriters
Burns & Wilcox
Cincinnati Specialty Underwriters
Cochrane & Co
CRC
FTP
Griffin Underwriters
Hull & Company
Jimcor
Next
One General Agency
Peachtree
Quaker Special Risk
Re Chaix
SIS
Tapco
US Risk
USG
XS Brokers

Ability to place niche or emerging risks

Appalachian Underwriters
Bass Underwriters
Burns & Wilcox
CRC
FTP
Griffin Underwriters
Hull & Company
Jimcor
Next
Peachtree
Quaker Special Risk
Re Chaix
SIS
US Risk
USG

Range of products

Appalachian Underwriters
Bass Underwriters
Burns & Wilcox
CRC
Hull & Company
Jimcor
Next
Peachtree
Quaker Special Risk
Re Chaix
SIS
Tapco
US Risk
USG

Compensation (commission, bonuses, profit-share, etc.)

Burns & Wilcox
Cincinnati Specialty Underwriters
Jimcor
Peachtree
Quaker Special Risk
Scottish American
SIS
Tapco
US Risk
USG

Overall responsiveness

Appalachian Underwriters
Bass Underwriters
Burns & Wilcox
Cincinnati Specialty Underwriters
CRC
FTP
Griffin Underwriters
Hull & Company
Jimcor
Next
One General Agency
Peachtree
Quaker Special Risk
Re Chaix
SIS
Tapco
US Risk
USG

Reputation

Appalachian Underwriters
Bass Underwriters
Burns & Wilcox
Cincinnati Specialty Underwriters
Cochrane & Co
CRC
FTP
Griffin Underwriters
Hull & Company
Jimcor
Next
One General Agency
Peachtree
Quaker Special Risk
Re Chaix
SIS
Tapco
US Risk
USG

Marketing support

Bass Underwriters
Jimcor
Quaker Special Risk
Re Chaix
US Risk
USG

Technology/automation

Bass Underwriters
Cochrane & Co
Jimcor
Next
Quaker Special Risk
SIS
Tapco
US Risk
USG

Geographical reach

Appalachian Underwriters
Bass Underwriters
Burns & Wilcox
CRC
Griffin Underwriters
Hull & Company
Jimcor
Next
One General Agency
Peachtree
Quaker Special Risk
Re Chaix
SIS
Tapco
US Risk
USG

Methodology

To find out which wholesale brokers and MGAs are delivering standout service to their partners, Insurance Business America surveyed 1,466 retail producers, asking them to rate the performance of their wholesale broker or MGA partners on a scale of 1 (poor) to 5 (excellent) in the following areas: overall responsiveness, technical expertise and product knowledge, pricing, ability to place niche or emerging risks, range of products, reputation, marketing support, compensation (commission, bonuses, profit share, and others), technology/automation and geographical reach.

The wholesale brokers and MGAs that earned an average score of 4 or higher in at least one category were awarded a 5-Star designation, signifying their exceptional service. In total, 33 wholesale partners earned a 5-Star rating this year. Among them, 7 achieved All-Star status, having earned 5-Star ratings in all 10 categories.

5-Star Wholesale Brokers and MGAs 2022

Significant growth through outstanding service

The state of the market

How winners are distinguishing themselves

Other survey insights