An intermediary sitting between the client's broker and the risk carriers, providing access to specialist markets the retail broker lacks.
The wholesale broker never meets the policyholder: its client is the retail broker, who hands over a risk it cannot place because the risk is unusual, larger than its usual capacity, or sits in a market where it holds no accreditation. The wholesaler supplies three distinct things, access to specialist carriers and the excess and surplus lines market, technical drafting expertise on rare risks, and the ability to split a placement across several insurers. Its remuneration is added to the retail broker's, which lengthens the chain and the total cost borne by the policyholder, a transparency question conduct regulators regularly examine through the lens of value delivered to the client. Its weight grows mechanically in a hard market, when admitted carriers withdraw from whole segments and risks migrate to the surplus lines market, so the share of premium passing through a wholesaler is a good leading indicator of how hard the cycle has become.
In the United States, the growth of the excess and surplus lines market from 2019 onward, fed by admitted carriers withdrawing from wildfire and liability risks, mechanically increased the share of premium routed through wholesale brokers, since access to that market is reserved to them in most states.
wholesale broker, courtier de gros, grossiste en assurance