Admitted or Surplus?

The first question is whether the policy will an “admitted” or “surplus” policies. An admitted policy is one that an admitted insurance company will write. If the policy does not fall within the admitted market, then it is deemed a surplus policy. A licensed surplus lines broker will determine if a policy is admitted or surplus. Generally, the declination of three admitted carriers is sufficient to place the business with a surplus carrier. Because you’ve created a new insurance product, it very likely that no admitted carrier will write the policy and thus it can be written as a surplus lines policy.

The Benefits of Surplus Lines Policies

The primary benefit of a surplus lines policy is that the policy rate and form can be changed at any time. With most admitted policies, any change of the rate or form requires approval by each state department of insurance. The approval process is time consuming and costly. With a new insurance product, the ability to quickly change the policy and rates in response to consumer response and claims is critical.

Why Choose Concord Specialty Insurance Company as your Fronting Carrier?

Concord Specialty Insurance Company provides fronting services for surplus risks and we are used to working with startups. Concord Specialty is rated A- (Excellent) by A.M. Best, a leading insurance rating agency.

We pride ourselves on being quick and nimble. We look for small loss limit program business where we will retain between 0-20% risk and reinsure the rest to your captive reinsurer. Because we are a smaller insurance company, we move quickly and we don’t require huge minimum annual premiums.

Concord Specialty will consider both traditional reinsurers and collateralized reinsurers. Concord Specialty prefers that program submissions include:

  • Business plan including distribution, reinsurance, and claim handling capabilities.
  • Proposed policy form
  • Proposed reserve amount
  • For existing programs, premium and loss history and any actuarial reports.