It's in some bean counter's pocket!

And he is never, ever going to let it see the light of day again!  Maybe that is a bit dramatic, but we have all seen it.  Where we used to be able to jump on the phone and say, essentially, "come on Mr. Underwriter, do me a solid, this is my best client" we now find the answer is no.  There are more reasons for this than I can count, but I think they all boil down to a couple themes:  reinsurance, and profitability.

I think we should all understand the specifics of the reinsurer's role in underwriting today, but profitability seems a bit too obvious, right?  Maybe.  See, we all know that an insurance company needs to turn a profit, and that publicly traded stock companies are particularly sensitive to this.  What is lurking beneath the surface, however, is that the carriers now have to factor in the profitability of a specific case when making their underwriting decisions.  It is the only way to protect their total bottom line.

What do I mean?   

Simple - the only way you are getting that offer from Table 2 to Standard on that large case is if the carrier can still make an acceptable profit based on the offer, death benefit amount and premium structure.  While I won't go as far as saying they do not care about the "relationship" any longer, it is very seldom the reason for a decision.  It may be the straw that broke the camel's back on a close one, but if the numbers aren't there, neither is your offer!

So the big question is how to play by the new rules of the game?  If we can't rely on traditional business decisions, "beating up" the underwriter, or shot gunning cases to 20 carriers hoping to catch one making a mistake, what are the core competencies that need be in place to manage the large case in this new environment?.  I guarantee you that there is a much more effective way to do business.  For those of you asking what that may be, please read on!

The progressive BGA relies on a completely updated strategy.  The foundations are long term partnership, predictability and trust.  The core competencies are the ability to understand and articulate all the intricacies of the large case.  Then, and only then, can an underwriter and all of the other parties (sales, management, reinsurers) to the decision feel comfortable making the tough calls on your cases.  Not to mention pushing your business through in a timely manner.  With all of this comes an expectation at the carrier level that they will capture a larger share of the production from your office.   

I think that expectation is warranted, and that unless there is truly a give and take between the BGA and the carriers the relationship is going to be a short one.  The truly effective partnership will be based on a commitment to work under a mutually agreed upon set of guidelines that allow both parties to succeed.  Anything else is destined to fail.  Frankly, I think the same could be said of a relationship between a BGA and their producers!