Appointing Service Providers
The role of the Underwriting Manager. Depending on the resources available to it a risk retention group may wish to either develop its own underwriting manger or outsource to an existing managing general underwriter or third party administrator.
The underwriting function is key to the success of the business as rates and policy forms as well as underwriting guidelines will all need to be developed and utilised to ensure that the most coverage is made available at the most cost-effective price, but that an underwriting profit is achieved so that members are not asked for additional contributions. The role of the Underwriting Manager can include:
- Developing an Underwriting Manual or Guidelines
- Premium Collection
- Underwriting Services
- Policy Issuance Services
- Claims Services
- Accounting Services
- Claims adjusting
- Handling negotiations with reinsurers and reinsurance intermediaries
- Recommending other Service Providers.
The role of the Reinsurance Intermediary The relationship with the reinsurance intermediary is important as the intermediary will be responsible for designing the reinsurance program and ensuring that risk transfer objectives are achieved.
Reinsurance Intermediaries are situated in the U.S., Bermuda and the London market and will often work with intermediaries in other jurisdictions in which they are not represented. In today's world of easy electronic access most reinsurers can be accessed directly by any intermediary regardless of where they are located, although Lloyd's of London which only transacts reinsurance business with Lloyd's brokers.
The role of the Reinsurance Intermediary should include:
- Assisting in the compilation of information for reinsurers
- Making Presentations to reinsurers
- Securing coverage once terms are agreed.
- Processing premiums and claims
- Drafting the contract wording for each reinsurer and getting the document approved.
- Developing the relationship between the Risk Retention Group and the reinsurers.
