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Program Insurers and Administrators

How has the soft market affected the programsbusiness?
Brendan Brownyard: Forany program, an individual risk that may have been acceptable 5years ago may not be acceptable at today's pricing. It's alsopossible that a previously desirable risk may, for its owncompetitive purposes, accept work that we would considerunreasonably hazardous from an underwriting standpoint. Experiencedprogram managers know that after 5 years of shrinking rates, theeffort to maintain underwriting standards is critical to aprogram's success; they also know they must compete not just byprice but also in service and expertise. For example, ourefficiency in handling complex claims through our in-house claimsfacility (Brownyard Claims Management, Inc.) and extensiveknowledge of the industries we service have proven to be invaluabletools.
Glenn Clark: Rockwood's core prospects are inmanagement liability. The soft market has put downward pressure onrates on employment practices and made it harder for us to keeprenewals at a credible rate. Larger E&O accounts are especiallyvulnerable to carriers who exhibit some pretty risky pricingstrategies. We have a duty to protect our carrier partners, andprogram business is the best way to have deeper relationships witha partner. I simply cannot imagine what a non-affiliated wholesalermust be going through,
Greg Thompson: There are many carriers expandinginto the programs market and those who are already in the marketare expanding into new programs. As a result, there is increasingcompetition which should result in continued downward pressure onpricing in 2010.