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In a world of supply and demand, the demand for healthcare underwriters has quickly outpaced the supply. And it is this demand             formation of Pro-Praxis.


The most important value propositions of a managing general agency (MGA) are the technical expertise and the access it lends to select market segments. The team saw the limited underwriting experience as the problem that they could solve for carriers interested in this space. Pro-   markets. Instead of committing the team’s human capital under an          under a MGA/carrier model.


“With so many insurers interested in MPL and a MGA model to support them, the next question to answer was ‘which carrier(s) should they support’,” says Allen.


Pro-Praxis felt it was critical to have a partner who understands the


business. At the same time, the company did not want to work with a market (or markets) that was already operating in the proposed segment. Most importantly, they needed a company that could appreciate their strategy for  


By developing insurance products underwritten by certain underwriters


at Lloyd’s, Pro-Praxis could align itself with support that had similar risk strategies. Lloyd’s is the world’s specialist insurance and reinsurance market, bringing together an outstanding concentration of underwriting expertise and talent. The Pro-Praxis facility is supported by Dale, Brit, Amlin, Atrium, Chaucer, Pioneer and Aegis, a blend of seasoned underwriting professionals with comparable underwriting appetite.


“We told underwriters we were not going to have an exhaustive list


of eligible insureds. In the case of Life Sciences, we felt we had an opportunity to be very selective but these limitations would also reduce the ultimate size of the book,” says Allen.


Figure 1: Accident year loss ratios of six MPL carriers*


40% 60% 80% 100% 120% 140%


0% 20%


Accident Year Loss + ALAE Ratios


 and cons of primary versus excess, small versus big accounts, broad coverage versus restrictive, retail versus wholesale. In a short period of time we found underwriters who understood and appreciated our strategy and value proposition.” A similar approach was taken with domestic and international insurers which led to their Hospital Excess Liability Program.


The MPL segment is complex and the underwriting results vary based on several moving, yet integrated, pieces. At Pro-Praxis, they believe that the analysis of industry and individual risk data must go hand in  veteran or new capital entering the market, it is easy to understand why their strategies led Pro-Praxis to the London Market. 


Robert Allen is president of Pro-Praxis. He can be contacted at robert_allen@propraxisins.com


“In a short period of time we found underwriters who understood and appreciated our strategy and value proposition.”


2003 Carrier 1


2004


2005 Carrier 2


2006 Companies Total


*And for MPL insurers as defined in Standard and Poor’s January 2014 report. Source: Aon Global Risk Consulting


2007 Carrier 3


2008 Carrier 4


2009


2010 Carrier 5 S&P MPL


2011


2012 Carrier 6


Annual 2014 | HEALTHCARE RISK MANAGEMENT REVIEW | 53


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