TOP STRATEGIES FOR NAVIGATING THE HABITATIONAL MARKET
It’s a hard market, but there’s plenty of opportunity on the table for agents.
[N]on-admitted coverage is no longer a last resort.
It’s a viable option that offers more flexibility compared to standard markets … .
By Joe Mossbrook
If you feel like you’re stuck between a rock and a hard place when it comes to serving your habitational book, much less growing it, you’re not alone. Hard market conditions are holding steady throughout the commercial real estate (CRE) industry and the effects on the habitational space are clear. Property capacity is scarce. Carriers struggling with profitability in this arena are exiting the market. And underwriting guidelines are being tightened across the board.
None of that changes the fact that the $22 billion habitational property market needs to be serviced—and that there’s still plenty of opportunity for agents to thrive in the niche. These strategies can help you make it happen.
Have a holistic view of the industry
If you have any volume of apartment and condominium accounts, of course you’re keeping your finger on the pulse of the industry. But now, more than ever, it’s important to tap into different perspectives of market leaders and explore all options for securing coverage for your clients. Doubling down on your due diligence will help ensure you’re not at the mercy of what a limited group of carriers is telling or offering you.
Consider asking questions like: “How are offerings changing throughout the market?” and “If I keep seeing non-renewal or new business declinations, should I pursue a non-admitted option?” With a holistic, grounded view of the market, you can be confident you’re making the most well-informed decisions for your clients, and you can thoroughly educate them on why your guidance is best for their business.
Use non-admitted markets creatively
As admitted carriers scale back their appetite for habitational risks, non-admitted excess and surplus (E&S) line markets have become an increasingly attractive option for coverage—not only for tough risks but also as another alternative for traditional accounts. In other words, non-admitted coverage is no longer a last resort. It’s a viable option that offers more flexibility compared to standard markets thanks to proprietary forms, as well as competitive pricing in many instances.
The key lies in first finding a well-credentialed program with a top-rated national carrier. Then you can begin to proactively explore the possibilities of non-admitted coverage for your clients and do so with peace of mind.
Partner to identify growth opportunities
When a specialized insurance provider serves one segment of the market exclusively, growth goals in that industry are a given. Why not use that to your advantage to grow your own business? As a CRE agent, that means partnering with a provider that focuses solely on habitational risks and then working together to identify new opportunities and land additional accounts. This collaborative approach often brings forth ideas that likely wouldn’t have surfaced otherwise.
For example, during office visits, my team and I sit down with agents to not only discuss appetite and production goals, but also to review monthly expiration lists and renewal parameters. This helps them get ahead of planning for each of their accounts. We also strategize around premium thresholds to increase production.
Keep working toward your long game
Everyone in the habitational world is adjusting to the realities of the market. Some of those changes, such as shifting underwriting appetites, are not necessarily comfortable for agents today. However, they may be in place as a strategic measure for tomorrow.
Programs that are fully committed to the industry need to ensure they and their agent partners are positioned for success and sustainable growth over the long haul, even during periods of volatility. That said, these are also the providers who will work with agents to help keep their books healthy in the near term, too. Keep this in mind as you shop around and focus on your long-term business goals.
Is the habitational insurance industry challenging right now? Yes. But are there solid options and opportunities out there for agents and insureds? Absolutely. You can find them when you navigate today’s market with agility, foresight and expert partners by your side.
The author
Joe Mossbrook is the program director at HabPro Insurance, a real estate insurance provider specializing in package and monoline property for non-coastal apartments and condominiums. Built by NSM Insurance Group, a provider of specialty insurance programs, HabPro is available on a non-admitted basis and is focused on providing competitive coverage to the small to middle-market arena. To learn more, visit habproinsurance.com or contact Joe at jmossbrook@nsminc.com.
