It's been a good decision for both us and our wholesalers–and one that we would recommend to other agencies.

In general, most wholesalers have the same markets available to them. But two years ago a lot of wholesalers had so many submissions that they could pick and choose the accounts on which they wanted to work. The result was that many were lax about responding promptly. Nevertheless, we still had the paperwork associated with keeping them in our database and tracking submissions.

Now 90 percent of our wholesale business is with six to eight companies. When you pick a few and can give them a steady flow of business, they're going to go to bat for you when you have a problem or an especially difficult account. If you're only sending them two or three submissions a year, you don't have the same level of rapport and trust.

The wholesalers with whom we work all have similar processes. When they receive a submission, they acknowledge it by e-mail and tell us to whom it has been assigned. They get back to us within seven to 10 days and tell us which markets they think will play.

When it comes to specialty markets, such as habitational risks, pharmaceutical, residential construction, we've found we usually are able to work with the same wholesalers that we use for the bulk of our other business. Only occasionally do we have to stray from the path and get a wholesaler that has a niche market involved.

Typically we send submissions to wholesalers 75-90 days ahead of time. Periodically, we'll have a last-minute request from a client or prospect. That's when we call in a favor to get a response in time. The favor is normally granted due to the rapport we have with our limited number of wholesalers.

If our wholesalers are not following up with us, we're following up with them. We have constant conversation throughout the process. The most important conversation is normally the first one where we decide on markets and what it will take to get an order.

The best wholesalers don't simply take orders but also offer suggestions. For example, they may suggest that a client could save money by switching from guaranteed cost to a loss-sensitive type program or visa versa if the market conditions are changing.

A good example of a mutually profitable relationship was the time a wholesaler helped us with a client who needed coverage for a large special event in addition to its general liability coverage. Placing special event coverage can be difficult, especially if it's the sort of event–which this one was–that could pose hazards to the participants and spectators.

In that situation, a wholesaler went to the renewal general liability underwriter and let them know that there was competition on the account, but that they were likely to get the entire piece of business if they could handle the special event as well as general liability. We were able to get good pricing on the entire package, and we appreciated the extra work that the wholesaler performed on our client's behalf.

Other wholesalers respond with spreadsheets comparing the coverages available. Quotes for various deductible options and umbrella limits also are helpful. We have one wholesaler who often quotes $5-, $10-, $15- and $20 million options. This makes it easy for the client and us to assess the options. We appreciate the fact that they do this without having to be asked.

Another workers' comp wholesaler always takes the time to tell us how the company arrived at the price. They will send us their in-house loss modeling to illustrate why the premium is at a certain level. That, in turn, makes it easier for us to explain pricing to our clients.

When we decided to narrow our list of wholesalers, we began by looking at all of them by volume. Then we broke it down by the ones that we believed had the most expertise and brought the most to the table. We made exceptions for a few wholesalers who were particularly good in certain markets, even though we did not feel they were as good across the board.

Although we have 16 producers, there really was no resistance to the idea. Everyone agreed that it was chaotic to have dozens of wholesalers in the system.

The process of narrowing our list was hardly complex. We just picked the pool of wholesalers that we thought would do the best job and offer the best price and coverage. And an important part of doing the best job is responding promptly.

John Patterson is chair of the ad hoc committee on wholesaler relations for RiskProNet International Inc., a network of 28 leading independent brokers in the United States and Canada, and marketing executive for J.W. Terrill Inc. in Chesterfield, Missouri.

(Do's and Don'ts is one chart)

Do's for Wholesalers

1. Acknowledge submissions the day they come in.

2. Within 7-10 days let the broker know what markets look most promising.

3. Offer options that may save clients money.

4. Offer spreadsheets and other documents comparing the coverages available.

5. You've heard the phrase “location, location, location” in real estate? In the insurance business, it's “respond, respond, respond.”

Don'ts for Wholesalers

1. Don't make promises you can't keep

2. Don't send quotes that are not adequate from a coverage standpoint. Price is only one part of the equation.

3. Don't keep us in the dark. COMMUNICATE!

Art Caption:

As simple as it sounds, a wholesaler's promise to respond promptly when a broker asks for a quote is one that often is not fulfilled. Our biggest struggle has always been finding wholesalers who communicate promptly.

“If our wholesalers are not following up with us, we're following up with them. We have constant conversation throughout the process.”

John Patterson

When you pick a few [wholesalers] and can give them a steady flow of business, they're going to go to bat for you when you have a problem or an especially difficult account.