What is RT Specialty and how does surplus lines work?
What is RT Specialty and what role does it play?
RT Specialty is a large wholesale insurance broker that helps agencies place hard-to-insure risks through surplus-lines (also called excess and surplus, or E&S) carriers. When a risk does not fit the standard market, a wholesaler like RT Specialty acts as a bridge between your agency and specialty insurers. That channel is available through Olive Cover. Understanding why this channel exists requires a look at how the two markets differ, a question the FAQ on admitted versus non-admitted carriers covers in detail.
What is the difference between admitted and surplus-lines carriers?
Most insurance is written by admitted carriers, which are licensed and regulated directly by the Georgia Department of Insurance and backed by the state guaranty fund. Some risks are too unusual, too large, or too new for those carriers to write. That is where surplus-lines carriers come in. They operate in the non-standard market, meaning they are not backed by the state guaranty fund, but they are allowed to insure risks the standard market declines. In exchange for that flexibility, they have more freedom to set terms and pricing. For example, a newly constructed building used for an unusual manufacturing process might be declined by every carrier/" class="oc-glossary-link">admitted carrier in Georgia but still be insurable through a surplus-lines carrier with the right appetite for that class.
How does the surplus-lines placement process work?
Surplus-lines business cannot simply be bought off the shelf. It usually has to be placed through a licensed surplus-lines broker, and a state surplus-lines tax applies. A wholesaler like RT Specialty has the market access, underwriting relationships, and licensing to shop these specialty carriers efficiently, then bring back terms for review. The agency submits the risk, RT Specialty markets it to appropriate surplus-lines carriers, and the resulting quote is presented. That process can involve multiple rounds of negotiation over terms and limits before a final policy structure is agreed on.
What types of Georgia businesses use surplus-lines coverage?
A Georgia business with an unusual exposure, such as a vacant building, a high-hazard manufacturing process, or a contractor with a tough claims history, may need surplus-lines coverage when standard carriers decline. For example, a specialty general liability policy placed through a surplus-lines carrier might carry a $1,000,000 limit with terms tailored to the specific hazard, while a standard market carrier would decline to write the risk at any price. The FAQ on how Olive Cover selects which carrier to place a client with explains the broader market-placement decision. If you are exploring what coverage a particular business type needs, the FAQ on Georgia commercial coverage requirements is a useful reference.
When does a business actually need surplus-lines coverage?
Most businesses never need surplus lines. The standard market handles the vast majority of commercial risks in Georgia. Surplus-lines coverage becomes relevant when a business has a characteristic that causes admitted carriers to decline, such as a poor loss history, an unusual occupancy, or an industry classification that standard underwriting guidelines exclude. It is a solution to a specific market problem, not a default channel. A coverage review can determine whether your risk fits the standard market or calls for a specialty solution. Request a free coverage review or learn more about general liability insurance and how it applies to your business.