Willis looks to add non-admitted capacity to DBS panels

Willis Towers Watson North America is considering building an excess and surplus lines (E&S) component to the carrier panels it has been launching as part of its Differentiated Broking Solutions (DBS) strategy, The Insurer can reveal.

The move would add non-admitted capacity on pre-agreed terms to its existing panels and provide greater flexibility to the retail broker if it is unable to fully place a risk in the regular market.

Sources said the initiative seeks to create a two-tiered process. The first tier would comprise specialty insurers who currently write non-admitted coverage on a direct basis. For the second tier Willis intends to work with its larger wholesale partners to put together capacity for pre-agreed E&S arrangements by industry.

It is thought that Willis will look to implement the plan across all of the DBS panels it has been building out.

To execute its E&S panel strategy the firm will look to work with wholesale brokers that are able to demonstrate specific expertise in industries and segments its panels have been built to service.

That would mean that if, for example, RT Specialty had a specific expertise in a panel’s area of focus it would tee up E&S capacity alongside the admitted carriers on pre-agreed terms.

If Willis is unable to fully place with the admitted carriers signed up to that panel, or with the non-admitted direct insurers, the E&S component would be activated with the RT Specialty-arranged non-admitted carriers, in that example.

If in that instance RT Specialty was unable to place it, then another wholesaler such as AmWINS could step in with its own signed-up carriers at pre-agreed terms.

The strategy would help build additional capacity at a time in the transitioning marketplace when placements in hardening segments where there is dislocation from carrier retrenchment have been more difficult to complete.

It also comes as the wholesale distribution channel is seeing a surge in submissions and new business – largely driven by admitted carriers pulling back and retail brokers having to engage their wholesale partners to access non-admitted capacity in the open market.

Sources said that Willis believes the strategy will allow it to get better terms and conditions for its clients than if it went the traditional route in the open market through wholesale brokers.

It will also add capacity and help create a more orderly market without disintermediating the broker’s wholesale relationships.

DBS momentum continues with FI panel

Meanwhile, The Insurer understands the broker, following the successful launch of its General Industry (GI) DBS panel for middle market clients in a move first revealed by this publication earlier this year, is close to another addition to the DBS stable. An RFP has been issued for a financial institutions (FI) P&C panel, and a separate Finex panel.

The FI panel is likely to involve fewer carriers than the GI panel, however, because the eligible premium base for the FI P&C panel is significantly smaller than the $600mn GI book.

The latest launch is being described as an evolution of Willis’ panels strategy, with DBS offering custom insurance solutions across various industries.

DBS offers pre-agreed terms and conditions to create an “elevated floor” of coverage across all lines of business, with service standards also pre-agreed at a national level.

It is thought that Willis has plans in place to roll out another seven or eight DBS panels over the next two years.

The panels are aimed at increasing efficiency and contract certainty through the pre-agreed terms and conditions in a transitioning commercial insurance market – as well as growing Willis’s presence in the middle market segment.

Panels launched prior to the GI offering include an established small business panel called Select, which is effectively a consortium, along with a middle market-focused Finex offering.

There are also Finmar, property, environmental, umbrella and several construction panels up and running that have been launched in the last couple of years.

Willis Towers Watson declined to comment.