There is no denying that the program sector has continued to be vibrant and dynamic in 2020, despite the impact of Covid-19. But in a market that thrives on relationships, the craving for contact is palpable.

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Like many of the companies we cover, at The Insurer and Program Manager we have adapted our working practices and evolved our offerings to better engage with the industry in the time of the pandemic.

And this month Program Manager hosted its first ever virtual panel debate on the dynamics playing out in the US program sector – adding to the many similar events we have put on at The Insurer in recent months across the specialty (re)insurance sector.

The discussion was as lively as expected, and there was huge optimism about the ongoing prospects of a marketplace that has been blossoming in the last few years.

Among the topics you can read about in our extended coverage in this issue were the fast hardening E&S market and how the flexibility of non-admitted products are creating opportunities for MGAs, program carriers and reinsurers.

The panelists also covered innovation and the growing use of technology in the sector to improve underwriting and processes and mark out best-in-class MGAs and program administrators.

“As we come to the end of a year where the program sector looks to have passed the test of Covid with flying colours, we too hope for a return to some kind of normality in 2021, and an opportunity to engage with the market face-to-face again”

They also addressed the wave of hybrid fronting carriers that have entered the sector and are now an increasingly attractive option for MGAs and reinsurers when they are making decisions about insurer partners and finding ways to access program business.

And of course the discussion turned to Covid-19 and its impact on the program sector.

But rather than the direct impact on underwriting – both in terms of top line and loss ratios – the focus was on conducting business in the pandemic, particularly in relation to due diligence, onboarding programs and finding new opportunities and partnerships.

Matt Grossberg, CEO at expansive tech-enabled MGA ISC, described program and insurance business as a people and relationship business, arguably more so than other areas of financial services.

“Our relationships are obviously in good shape, but it would be nice to be with friends and colleagues and working through deals together.

“I think it makes it a lot easier to put programs on the books, and I think it makes it a lot easier to bring in new accounts and new business, and for our broker friends as well,” he commented.

Face-to-face

Todd Campbell, president and CEO of Accredited Surety and Casualty Company, said his company had not seen disruption in taking on business, and had not had to sacrifice any degree of due diligence.

But he too lamented the lack of face-to-face interaction.

“That to me is the biggest loss during all of this. There are a lot of fantastic people in our industry and when we can work together face-to-face, some of the best things happen,” he said.

Daryl Polenz of Swiss Re said there is no substitute for meeting partners in person, sitting in a room and asking them about their underwriting expertise, processes and risk selection.

“It’s more challenging; it’s not that it’s not getting done, it’s just that it’s a bit more difficult,” he said.

The US program sector in particular thrives on interaction at events like Target Markets – which saw both its main events canceled this year.

In a market that relies heavily on due diligence, trust and track record, the ability to look a counterparty in the eye before signing a program deal cannot be underestimated.

The innovation that the program sector and its MGAs and carriers are known for also thrives on interaction.

As we come to the end of a year where the program sector looks to have passed the test of Covid with flying colours, we too hope for a return to some kind of normality in 2021, and an opportunity to engage with the market face-to-face again…