Great whites eat dolphins, unless of course, the dolphins get together with the other dolphins. There is power in working together with others of your species. Dolphins aren’t the only ones that have discovered that there is strength in numbers.
Our financial services practice has noted a recent trend among financial institutions to leverage the power of the group when it comes to purchasing their insurance. Working together, firms have been able to demand better pricing and better terms from their insurance underwriters—sometimes by as much as 10-21%.
It appears that underwriters, for their part, are willing to treat buying groups the way they treat larger insurance purchasers because selling to a group is more efficient from their perspective and can substantially reduce their own costs as a result of efficiencies in analytics, negotiation and servicing.
But precisely where and how were underwriters saving by selling to a group? We’ve deconstructed some of our recent transactions involving coordinated purchasing groups and issued a paper with the results. Feel free to download it for more details about what we’ve found.