Strength in selectivity Our approach to assessing programs

If there was a song that summed up Zurich North America’s approach to adding new insurance programs, it might be “Getting to Know You” from that perennial musical theater favorite, “The King and I.”

Programs insurance remains a growing sector in the industry. In fact, it continues to outpace the overall commercial insurance marketplace according to the Target Market Program Administrators Association (TMPAA). Growth in the programs space is longstanding, too, as evidenced by this impressive stat from the TMPAA: “Since the launch of The TMPAA State of Program Business Study in 2011, it has documented the growth of premiums from $17.5 billion in 2010 to $79.07 billion in 2022 — a 352% leap.” ¹;

Both carriers and Program Administrators are optimistic about the sector going forward. The TMPAA’s 2023 study showed 83% of administrators polled planned to introduce new programs in the next two years and 96% of carriers surveyed planned to add new programs in the next three years.¹;

With such a positive outlook, someone might ask why carriers aren’t simply adding new programs all the time. For Zurich, the answer is simple: Success in programs is not a numbers game; it’s about making the right choices for our company and the PAs we work with.

“We are committed to profitably growing our Programs business with the addition of new programs,” said Ryan Whitney, Vice President, Head of Programs Sales at Zurich North America. “By clearly communicating in the marketplace what our business appetite is and where we want to grow, we’re able to make better decisions faster in terms of what new programs are a good fit. Critical to maintaining that efficiency is working with Program Administrators who are able to provide the amount and quality of data needed to make those decisions.

This dual discipline — requiring fuller transparency in appetite from Zurich and in data coming from PAs potentially launching new programs with us  — benefits both parties. Programs that are a good fit for Zurich can get up and running faster, not weighed down by months and months of prolonged reviews. And on Zurich’s end, spending less time in consideration of programs that ultimately may not be a good fit allows more time to dedicate to the PAs we do collaborate with.

Our cautious and diligent approach should not be misconstrued as a reluctance to take on new programs. Zurich has a team of experienced professionals dedicated solely to the assessment and implementation of new programs — a function some other insurers in the programs space have not been able or willing to add to their operations.

The Zurich Programs team understands selectivity cuts both ways and they expect potential new PAs to be as careful in choosing a carrier to work with as they are in deciding when to add a new program. Beyond Zurich’s 60-plus years in the programs space, financial strength, and known underwriting discipline, the longstanding relationships we have with PAs stand as some of the best evidence of our commitment to specialty insurance markets. The average tenure for current Zurich programs is 13 years. Over half of our programs have a history extending past that 13-year mark and several have been running for more than 19 years.

The nature of specialty insurance markets and the wide variety of customers they serve is that business appetite evolves across the industry. Among the areas where Zurich is currently targeting growth, however, primary Casualty Insurance lines for industry-homogenous and niche-focused programs are a key focus. Looking at programs through an industry class prism is also a top priority.

Our thorough and measured new program assessment strategy is how we pave a path to a “win-win” relationship with the Program Administrators we work with … so we can grow together.

1. The Target Markets Program Administrators Association (TMPAA) State of Program Business Study 2023.