“It does not mean that we won't consider anything new. It's just that we're probably not as aggressively looking for them,” he said.

He said that while individuals in Scottsdales marketing department used to focus heavily on new programs and product development, the firm is now putting fewer demands on its marketing department to perform in that capacity. “They are [now] doing more of the traditional type of marketing, which is going out and making sure that our relationships with agent customers are as they should be,” he said.

“What we're hoping to do is to grow by doing more with the agents that really helped build Scottsdale in the first place. We're really not aggressively looking at new programs and we're really not aggressively looking at making any new appointments,” Mr. Tiepelman said.

He also said that Scottsdale cancelled five program and agency relationships last year, including in the count two MGAs that were just focused on one particular line of business, like auto.

At SAFECO, executives wielded a bigger ax, cutting 15 of 19 programs it had on its books in May of last year, according to Dale Lauer, president and chief operating officer of SAFECO Business Insurance.

At the time, SAFECO had two separate commercial lines operations–SAFECO Business Insurance, which focused on small-to-medium account business written on an individual risk basis through independent agents; and a second operation, SAFECO Commercial, focused on writing large individual risks and program business.

While SAFECO Business “had significant size, scale, scope and improving results” with $1.5 billion of business written, Mr. Lauer said that the SAFECO Commercial operation, which included its program business, didnt have those characteristics.

As a result, SAFECO decided to create just one commercial enterprise out of the two operations that would focus on the small-to-medium account market. “We looked at each [program] individually to determine [whether] it fit where we [were] going as a company in commercial lines,” he said. Some programs also didnt make the cut because they were unprofitable.

At the time, SAFECOs program business volume was $293 million. With only four programs today, the volume is down to $166 million.

Remaining programs–mini-storage warehouse, non-profit social services, force-placed property, and insurance agents E&O–each have at least $12 million in premium volume, Mr. Lauer said.

Even within those four core areas, he said, “we're not looking to add any more programs,” noting that the Seattle-based insurer has strong partnerships with existing program administrators that it doesnt want to disrupt.

Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, July 15, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.