Canadian Underwriter

Multinational Insurance: The Case for Non-owned Broker Networks

March 1, 2011   by T. Neil Morrison, HUB International, HKMB Ontario; Bruce Basso, Worldwide Broker Network Ltd.

Print this page Share

The stewardship of a multinational insurance program entails being familiar and knowledgeable with each country’s laws, insurance requirements, cultural and economic considerations and customs that might affect their firm’s risk management objectives. Impractical as it is for any one individual to keep abreast of all the disparate pieces, the risk manager relies on people and resources on the ground in the various geographies to ensure timely and efficient execution of their risk and insurance mandate, and to ensure it is done so in concert with the core values and global risk strategy. Upon whom do you rely?  

Risk Managers have three distinct options:

  • Build a “captive network” of brokers in each territory dedicated to their interests.
  • Engage a broker with an “owned” office present in each territory.
  • Engage a broker with a non-owned network of trusted broker-partners domiciled in each territory.

Having control over your destiny and objectives is every risk manager’s desire. However, except for in the situations of very large multinational financial institutions, building and investing in a captive broker network is prohibited by time, expense and the ability to manage the system with sufficient business to sustain the relationship.

Engaging an international brokerage firm with owned international offices might pose a problem when one or more country relationships falter in an otherwise well-run program. The risk manager is faced with the problem of tolerating the non-performing office or changing the entire program.  

Non-owned networks such as the Worldwide Broker Network (WBN) offer an alternative hybrid solution popular with many international risk managers who want both a domestic “coordinating broker” and also the versatility and oversight over the foreign placements of their global program. This model is successful because it meets four critical success factors: flexibility, collaboration, communication and responsiveness.


Non-owned models such as WBN enjoy the benefit of low investment costs to be a member and participate. They are motivated by the desire to meet fully the client’s needs and objectives. They are able to correct or replace non-performing country partners quickly with another option that may better meet the needs of the client.

Owned office brokerage models entail significant investment costs to enter the marketplace and tend to focus on margin and profit center exclusivity. Poorly performing offices in an owned network cannot be easily substituted because they are part of an overall package and hierarchy.


The non-owned model exists by virtue of a mutual desire among its members to formalize longstanding business relationships that have the benefit of trust and a strong reciprocity in services and culture.  Their mutual interests have forged protocols, guidelines, responsibilities, objectives and a common use of a
credentialed international information system that focuses on client delivery
as the Number 1 priority. This environment avoids the owned network’s inherent issues of hierarchy and office politics.


In an owned or non-owned model, effective international technology – collaborative with the client, its varied locations, brokers, insurance carriers and any designated interested party – is critical to executing a program that successfully meets all client objectives and supplies timely information upon which a client can make an informed decision. Knowing the up-to-date and current status of issues and the activities pursued to address them reduces error and puts these solutions on the correct path for saving time and money. Allowing all parties to converse and manage a client’s objectives in real time gives the client a strong advantage in the global management of information.


If all the parties understand the mutual objectives of the client and have formed relationships that foster timely communication and results, then the propensity for success is much higher. Responsiveness wanes when the broker is internally focused or hindered with ineffective hierarchical processes.

WBN members from around the world meet twice annually at host country venues. They invite all risk managers of their clients and prospects to be a guest of the members, and meet and work with their global account partners. The added value derived from the personal relationships that a client forms produces superior results in both the general administration and problem solving aspects of a global program.

The WBN members next meet in Vancouver on Apr. 28-30, 2011, just ahead of RIMS.