Program suffering from CC? Channel Conflict

Program suffering from CC? Channel Conflict | Insurance Business

Program suffering from CC? Channel Conflict

Agents and Program Administrators work hard to develop and maintain a specialty program. Programs require subject matter expertise and insureds rely on this to make sure that they are getting the best possible policy in terms of coverage at a competitive price. The challenge for most program managers working with carriers is that many take a generalist approach that is supported by an open distribution model. This can quickly put the program in a precarious situation. This is often referred to as channel conflict.

In this day and age, many carriers are seeking premium from any reliable distribution source available and are reluctant to turn away similar business. 

This carrier strategy can often compromise or leave a specialty program vulnerable. The insured may end up receiving two quotes from the same carrier: one from the program manager and one from a generalist agent. The competing quote may be offered by a small commercial division or middle market department. What follows is a myriad of mixed messages and confusion.

“Program managers have enough to think about, such as building their book and providing their customers with high levels of product and service,” says Rich Suter, Divisional President, Great American Alternative Markets. “Having their program cannibalized by their own carrier is an unnecessary setback and distraction that can be avoided with a specialty program provider like Great American.”

Unlike many P&C insurers, Great American does not have a general commercial lines division – it is a specialty carrier. The competition for the same business in different divisions of the company is very limited, and programs, in general, carry across-the-board value and priority throughout the organization. This means Great American can offer the program and program manager significant franchise value.

The model at Great American Alternative Markets is designed to develop and grant enhanced coverage for each program.