Industry executives have long maintained that insurance is arelationship business. This holds true even in today’s dynamicmarketplace of hardening property-casualty rates, expandingproducer responsibilities and health insurance reforms.

But to really leverage those relationships, they must be deepand limited. The connection extends beyond underwriters to theirsenior management, who are able to make decisions underwriterscannot in certain circumstances.

Related: Read the author's feature story, "Strange& Wonderful" and gain more insight into the agent/insurerrelationship.

The intangibles of a relationship are critical—“Just being ableto call up management and talk about the backroom office not beingup to snuff or an underwriter not understanding an opportunity,”said Augusto Russell, partner at May, Bonee & Walsh Inc.

“You don’t want to throw the underwriters under the bus, but youwant the ability to work with someone above them.”

Russell’s relationship with an insurer saved a client a hugepremium hike in the wake of a significant aberrant loss despite theclient’s sound loss control system. According to Russell, noadditional loss controls would have prevented it from happening andhe was able to help the client’s insurer’s senior executivesunderstand that. The executives gave him the opportunity to changetheir minds because their strong relationship.

But agents must determine which insurers to build relationshipswith. It cannot be with all of them without sacrificingquality.

Likewise, carriers need to identify what agents they shouldinvest in because insurers do not have unlimited resources.

The Chicago-based insurer CNA has been working this for the last3 years, having taken several measures to improve relations withagents. But these efforts have shrunk its agency plant by 800 to3,800 since 2011, according to vice president for producer andproduct development Roger M. Nulton, Jr.

“Before then, we talked about what we wanted to talk aboutrather than what our producers were trying to achieve,” saidNulton. “As a result, the insurer and agents did not discusswhether or how they could align their interests.”

Since then, CNA has trained its underwriters in relationshipbuilding. Before visiting agents, underwriters engage inpre-meeting planning to develop their meeting agendas andgoals.

“This allows us to plan better with producers and coordinatewith producers,” Nulton explained.

In addition, different CNA underwriters now coordinate with eachother to eliminate duplicative discussion points.

Similarly, Hanover Insurance Group takes “a verylimited-franchise view” of its independent agent channel since theinsurer began focusing solely on property/casualty insurance adecade ago according to Richard Lavey, president of fieldoperations and chief marketing officer for the company.

The insurer works with a total of 2,500 agents, though fewerproduce most of Hanover’s business. Of that total, Hanover hasappointed between 200 and 300 over the past two years.

Hanover encourages producers to be industry specialists byproviding day-and-a-half-long educational seminars that covercritical information about several industries. The seminar alsoexamines how to sell to buyers in industries including technology,health care and not-for-profits.

The insurer is also exploring the idea adding more seminars onadditional industries.

Hanover is not an agency management specialist, so it does notattempt to direct agents on running their shops. What the insurerdoes do is support its agents by sponsoring studies that examiningissues such as producer investment and perpetuation planning.Hanover also financially assists the Assurex Development Corp.fund, which aids Assurex Global agencies carry out theirperpetuation plans.