From Broker to Builder: Why Your Local Insurance Agent Wants to Be the Underwriter

Every great retail broker has a story they tell with a hint of frustration. It’s about that one client, or that one niche, they know better than anyone else. Maybe it’s a portfolio of craft breweries, a group of freelance photographers, or a chain of local restaurants. The broker understands their risks inside and out.

They know precisely what coverage these clients need. And yet, they’ve always had to go, hat in hand, to a big carrier to find a market—a carrier that might not fully get the nuance, that might use a one-size-fits-all approach, and that ultimately holds the pen.

But what if the broker could hold the pen themselves?

This question is driving one of the most significant shifts in the insurance industry today. We’re witnessing a surge of entrepreneurial retail brokers evolving from mere agents to builders. They are developing their own specialized insurance programs, effectively becoming Managing General Underwriters (MGUs).

It’s More Than a Trend, It’s an Opportunity

We’ve been referring to this shift as “programtization” in our recent strategy sessions, and a perfect storm of expertise and technology drives it.

A broker with extensive knowledge of, for example, the classic car restoration market, has a significant advantage. They understand the clubs, the events, the specific risks involved in transporting vintage vehicles, and the true replacement values. They possess a level of data and trust that a generalist underwriter many miles away could never match.

In the past, the idea of launching their insurance program was a pipe dream. The cost and complexity of building the necessary infrastructure—covering underwriting, rating, policy issuance, and claims—was prohibitive.

Today, that barrier has crumbled. Modern InsurTech platforms provide the “operating system” for insurance. They offer a turn-key solution that allows a savvy broker to plug in their expertise and essentially launch their own MGU. These platforms offer the foundation; the broker offers the architectural vision.

Flipping the Switch Isn’t Easy

Of course, this journey from broker to builder is a serious undertaking. It’s not a side hustle. We’ve seen at roundtables that the brokers who succeed are the ones who appreciate the gravity of what they’re doing.

When you hold the pen, you also hold the risk. This demands a new level of discipline.

• Underwriting Rigor: You can’t just rely on your gut anymore. You need a structured, data-driven approach to pricing and risk selection.
• Data Management: The data that once lived in your head and your files now needs to be managed with the same security and professionalism as a carrier.
• Regulatory Know-How: You’re stepping into a new regulatory world, and navigating it requires agility and expertise.

But for those who get it right, the rewards are immense. They capture more of the profit, build incredible loyalty with their clients by offering a truly superior product, and create a sustainable, defensible business. This isn’t just about finding a market anymore. It’s about creating one. It’s the ultimate expression of expertise, and it’s reshaping the insurance landscape one specialized program at a time.