Traditional marketplace carriers tend to shy away from risky clients, but a new program could help brokers tap into these niche markets a little bit easier.
“We’re a niche in regards to what we do, and our niche is very unique,” said Curtis Prince of Alternative Market Insurance Services. “You have the traditional markets with guaranteed costs for all standard carriers. Let’s say you’re a company that cleans windows on skyscrapers, which is higher risk so the carriers are looking and thinking ‘well if someone falls that’s going to cost us a lot of money.’ What happens with these carriers is they have a very rigid appetite and they try to avoid excessive risk; so if you work on a bridge, an oil rig or something that isn’t standard it ends up in our sphere – alternative markets.”
That’s where a business solution provider, like Alternative Market Insurance Services, offers a slightly different take on what a typical MGA can do on a high-risk policy.
“We want to be able to offer competitive workers compensation to our business partners,” said Prince, “so what we’re willing to do is put up a very large deductible. We are then able to sell their insurance because we’re self-insuring the first million to million and a half; for them it is like clipping coupons because they don’t have that first dollar exposure that they do in the guarantee cost market.”
In essence the solution is similar to a captive, except the end users don’t have to pay the million dollar deductible.
“We have complete control of the pricing, which is unheard of,” said Prince. “That’s where we capitalize on the alternative markets, acting as a wholesaler.”
AMS’s primary partners are insurance agents and the communication is driven by agent/client relationships. Agents and brokers come directly to the company when they have trouble getting coverage in the traditional markets.
“Whatever the risk may be we take that opportunity to go through our program,” he said, “and we’re usually able to find a financially viable solution.”
