Human expertise and analytics power programme underwriting success

While fierce competition and shifting distribution models might be reshaping programme underwriting, AM Specialty Insurance Company is betting on what it believes are the real differentiators: discipline, data and deep trust with partners.

KEY POINTS:
Data analytics boosting MGA partnerships
Alignment drives long-term programme results
Growth ahead in SME and parametrics

For Anne Hoffmans, executive vice president of programme underwriting at AM Specialty, it all begins with strong relationships. “We are in constant communication with our programme partners and brokers, and that’s so important in this environment, where things can and do change quite rapidly,” she told APCIA Today. 

The company focuses on specialised, niche MGAs that demonstrate strong underwriting discipline and differentiated distribution. “When the distribution partners are aligned with the MGA, that’s when we see improved results.”

This philosophy runs through the evaluation of new program opportunities, and Hoffmans stressed that profitability remained the first measure. “For us, the most critical criterion when evaluating a new MGA is its track record: not just loss ratios, but how the premium has developed over time, whether it has scaled in a controlled and acceptable manner,” she explained. 

Just as importantly, AM Specialty also looks closely at how each MGA reacts when parts of its book do not perform.

“If a particular segment or class within its book was not performing, how did the MGA respond? We want to know what steps were taken to reduce writings, and if the MGA had a profit improvement plan in place.”

Retention ratios, efficiency, operational capabilities and transparency all matter, as do long-term commitments. “There’s so much competition in the E&S space, so we target those niche writers with experience through both hard and soft market cycles,” Hoffmans said. “These aren’t transactional relationships.”

Technology is a major enabler of this evolution and Hoffmans described how AM Specialty had been building data and analytics into the underwriting process to sharpen efficiency and decision-making.

“This is critical in the programme space where tailored risk selection is key,” she said, explaining how the company had developed its own proprietary analytical database that adapts to underwriting needs and makes the team more agile.

The next step is strengthening data flows with MGA partners. “As a programme carrier, you’re always going to have that lag with receipt of the MGA data,” she explained. “That’s what we’re looking at next: developing APIs so that we can create a more seamless and efficient way to ingest the data.”

The same transparency extends to AM Specialty’s reinsurance relationships. “We maintain open, consistent dialogue with our reinsurers throughout the year. We don’t just touch base at the renewal,” Hoffmans stated. “We want to be very open so our reinsurance partners can allocate their capacity with confidence.” 

Our portfolio has always been managed with discipline, and we stay true to our targeted profitability margins. We don’t chase premium.” This discipline is matched by a belief in partnership attributes that stand the test of time.

“We stay true to our targeted profitability margins. We don’t chase premium.” 

“An aligned strategic vision, trust, open communication and cultural compatibility really matter. We want to be collaborative rather than transactional,” Hoffmans said. While technology can indeed enhance efficiency, she insisted that “human expertise will always be central to the underwriting process.”

Looking ahead, Hoffmans expects programme business to continue expanding as carriers seek efficient access to niche markets through specialist MGAs and MGUs. She highlighted growth potential in the SME space, within the E&S sector and through parametric products. 

“Parametric products are an alternative to traditional insurance. Typically, they have a short tail and more of a stated payout amount, so that’s easier to forecast loss ratios,” she noted.

Hoffmans also pointed to the importance of innovation and creativity. “With E&S, you’ve got to be creative; it goes a long way.” 

“There will continue to be new exposures which create new opportunities. It’s about how to control and understand the risk.” For nimble MGAs, the market is ripe. 

For AM Specialty, the strategy remains clear: disciplined underwriting, strong partnerships and openness to innovation. Hoffmans concluded: “I like to think this is still a relationship business. 

“Human expertise will always be central, but technology can help reduce friction with some of those operational tasks alignment can enhance what our MGAs are already doing and help us scale together.”

Anne Hoffmans is executive vice president of programme underwriting at AM Specialty Insurance Company. She can be contacted at: anne.hoffmans@amspecialty.com

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