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Channel Check by Kevin Amrhein The Specialist

For the good of the patient—your client—doesn’t it make sense to call in a specialist when needed?

By  Kevin Amrhein

“Don’t you think the patient would appreciate it?”

A noteworthy punch line, one of several standouts from a recent conversation with David Pagoumian, CEO of Edison, N.J.-based Napco, a wholesale brokerage specializing in property catastrophe risk.

The intention of his inquiry was to correlate a wholesaler’s position to the presence of a specialist in the O.R. during general surgery—a metaphor reflective of his passion for his firm’s position in the distribution channel.

There’s inflection in Pagoumian’s voice resonates with a combination of frustration, ambition and excitement he hopes will dissolve what he believes are unsubstantiated ideals and mandates surrounding the use of specialty wholesalers.

Napco has launched a two-pronged educational initiative. The first prong includes a twice-annual state-of-the-catastrophe market publication available on its website. “Since this is our specialty, we enjoy sharing our knowledge with others,” he says.

The second aspect of the initiative addresses what Pagoumian sees as the bigger picture—specifically, what is (and is not) happening to the wholesale distribution channel and what he hopes to see happen over the next few months.

His firm recently kicked off a wholesale/retail campaign, which will include a white paper on the value of wholesale brokerages. The goal, he says, is to expose in great detail the wholesaler’s role to the client and demonstrate the added value wholesalers bring to the table. “Wholesalers do not add to the cost of doing business. They add expertise or provide other options to the account team,” he says.

He hates the “man behind the curtain” moniker, challenging wholesalers to become part of the transaction, a face to the insured. “When retailers see our products they quickly realize the value we add, not only in knowledge, but in the entire process. In response, we’ve had a lot of retailers say ‘This is good stuff. Will you participate in the presentation to the insured?’”

During the past year, Napco has done a number of joint RFPs (requests for proposals) with retailers directly to insureds. The firm also provides what Pagoumian calls “conceptual marketing presentations” to retailers, a step, he says, that helps the retailer demonstrate knowledge of the insured’s business through modeling results, mapping, and program design. He believes this process offers several benefits to the retailer, including security of the insured’s data, pre-selling of the retailer’s capability, and pre-approval of the process and program by the insured.

Hearing his thoughts prompted me to ask why he believes many retailers insist on guarding their insureds from wholesalers and refusing to allow specialist involvement in the transaction. It’s a mindset he calls the “big broker mandate.”

“It typically says you should only use a wholesaler for what you can’t do yourself,” he says, a theory with which he vehemently disagrees. “There shouldn’t be any politics involved with bringing in a specialist if it’s advantageous to the insured.”

He is complimentary of many within the wholesale community who are taking similar steps to promote this distribution channel, but he admits that it’s discouraging when he runs across those who don’t seem to want to take action. Changing the way retail brokers think is “a tremendous challenge, which makes some hesitant to tackle it. However, if you strongly believe you bring value, you find opportunities to demonstrate it to those who will benefit, perhaps even directly to the client in concert with the retailer.”

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