How CFC is looking to tackle a small business insurance gap

Small businesses continue to face obstacles when it comes to accessing some commercial insurance products, a senior CFC business leader said as he shared how the hope of MGA can solve this problem using technology.

“We know there are high barriers to entry for many clients [to specialty commercial insurance],” Shannon Groeber, CFC USA CEO, told Insurance Business at the CFC Summit 2023 in Chicago.

With clients struggling to fill out detailed applications, brokers, according to Groeber, in some cases, “feel very intimidated about how to talk about so many different products, so many that solutions – the natural tendency is to just walk away from that conversation or not continue it.”

CFC uses technology to scan digital risks for its cyber insureds, track IP addresses and IP addresses they communicate with and scan for vulnerabilities, event attendees heard during the a session. The idea behind the latest update is to expand it and collect more usable data points, from permits and registrations to new products and partnerships, attendees were told.

“[We realized] if we just expand our scope, we can start collecting more information; a lot of things like risk for the technology company, or for the small professional service providers in the US,” Groeber said in a presentation.

The result, Groeber told Insurance Business, is that brokers can get more quotes in front of the 33 million small businesses in the US without having to ask for such detailed information. It’s a task that once proved to be a daunting task for the insured and ultimately turned out to be a dealbreaker that led clients to not tap the cover.

“Usually, there are a few employees, maybe there is a business owner, and the applications ask a lot of questions that they don’t necessarily have answers to, or have nothing to do with their business,” Groeber said about of target businesses. . “So we thought, if we can add that information, we can get information that we find valuable instead of asking them to bring it to us, then we can get more quotes from our brokers for their clients, and help they can make that sale by giving them more detailed information.”

“Now brokers can do multiple product lines at the same time – we have technology, different professional responsibilities that they can quote at the same time and present together,” Groeber said. “Those products are, for 20 years, as long as we’ve been talking about cyber, there have been assumptions that some of that risk has bled into E&O.

“It makes sense to put the coverages on the same carrier and reduce the worry about which policy will respond.”

Further expansion of the platform is on the cards, with a full suite of CFC liability management products to be added.

“[We want to focus] these small businesses, sole proprietors, or some with just a few employees, but actually tailor it to their specific concerns instead of talking about D&O [directors & officers] in the context of large public companies where those risks don’t translate, and so the products that exist don’t necessarily generate that value,” said Groeber.

CFC established an additional D&O insurance agreement that Groeber described as effectively replicating what it did for cyber but looking at events specifically targeting senior executives.

“They can have personal protection, they know that if they are specifically harmed from a reputational standpoint, or if there is false information on a website, we will help them remove that information, repair their reputation, and bring them back to pre-cyber levels. events,” Groeber said. “And if they experience any kind of personal financial loss because of that cyber event, we’ll cover that as well.”

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