Why Specialist Brokers Outperform Generalists (And Save You Millions)

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Welcome to the Pride,

In the insurance world, one size definitely doesn’t fit all.

Yet most financial institutions settle. 

They settle for generalist brokers who understand insurance but not their specific business. 

Many choose big-name generalists. 

Weaker coverage, higher premiums, watered down service and often, denied claims are the cost. 

In this edition, we're pulling back the curtain on the specialist vs. generalist broker debate that most won't discuss openly. 

• Why the gap between generalist and specialist brokers is wider than most realize

• How specialists identify risks you might miss (and why that matters)

• The 5 ways specialists deliver superior protection at a lower total cost

• How to evaluate if your current broker truly specializes in your industry

After recovering over $250 million in claims for Financial Institutions, we've seen what works and what fails. Here's what we've learned…

It Starts With Deep Industry Knowledge

The fundamental problem with most financial institutions' approach to insurance…

They choose brokers based on size, brand, and premium cost.

They ignore the factor that matters most. 

The difference between a generalist and specialist broker begins way before talking about coverage – it starts with specialized industry knowledge. 

Top specialist brokers focus on one industry. 

They know the companies they serve.

Patterns and risks are recognized that the companies themselves haven't spotted. 

At minimum, a good specialists understand your risks and exposures as well as you do – and typically better.

Why better?

Because specialists see dozens of similar firms, while you only see your own, and this gives them a broader view of risks facing your industry.

CASE IN POINT

When a regional insurer client faced an unexpected market conduct examination regarding claims handling practices in 2021, we had already updated their E&O policies with specific regulatory coverage extensions six months earlier based on trends we'd observed across their state’s insurance regulators. 

This foresight saved our client over $850,000 in investigation defense costs.

Costs that wouldn't have been covered under standard policy language.

When a broker focuses exclusively on your industry, they know:

• Current issues affecting your business

• Legal trends that will impact you tomorrow

• Challenges firms like yours face daily

• Specific risks that threaten your bottom line

• Operational and financial pressures you're under

This deep knowledge means specialists not only grasp your context and concerns.

They stay a step ahead. 

Spotting risks you might miss and help build strategies that work. 

They understand your business environment, and more importantly how underwriters view you, which matters enormously when structuring insurance programs.

As we often say…”effective insurance starts with understanding risk. You can't properly protect what you don't fully understand.” 

What Generalists Can (and Can't) Do

Generalist insurance brokers are like general practitioners in medicine. 

They can diagnose common issues and recommend standard treatments.

But would you want a general practitioner performing your brain surgery? We wouldn’t!  Any capable generalist broker can find carriers to take on your risk.

They can:

• Visit the market

• Locate underwriters

• Bring back some options

But that's where their value often stops.

The fundamental gap isn't about effort or intelligence—it's about immersion and focus.

The problem isn't that generalists don't try hard enough. It's that they spread themselves too thin across many industries. When you try to be everything to everyone, you end up being exceptional at nothing.

When a broker divides their attention across dozens of industries, they simply cannot:

• Know your industry thoroughly. Without living in your world daily, they miss critical context and nuance about your operations and exposures.

• Master your particular exposures. Financial institutions face distinct professional liability, cyber, D&O, and fiduciary risks that require specialized knowledge to properly structure.

• Develop specialized tools. Generalists can't justify building proprietary resources for just one segment of their business.

• Maintain deep carrier relationships. Carriers treat specialists differently because they bring better-structured risks, understanding of the exposures, and more volume in specific niches.

• Navigate complex claims effectively. When claims arise, generalists are playing catch-up in understanding the technical details that specialists already know.

The results can be devastating…

Coverage gaps you discover too late, higher costs over time, and claims that don't pay as expected when you need them most.

The 5 Areas Where Specialists Deliver More Value

After 25+ years in the industry, we've identified five key areas where specialist brokers deliver measurably better results…

1. Specialists Know Your Risks Inside Out

Specialists don't just understand insurance, they understand your business.

• They know the operational and financial challenges your industry faces

• They speak your language and understand your services without needing a primer

• They can anticipate emerging risks before they appear on your radar

• They've seen similar claims across multiple clients and know how to structure coverage proactively

EXAMPLE

When an insurtech client expanded into parametric weather insurance products using AI-driven modeling, our team immediately identified three specific technology exclusions in their standard E&O policy that would have left them exposed to algorithmic bias claims. 

A generalist might have missed these specialized insurtech exposures until claim time. Then it's too late. We negotiated custom endorsements that specifically addressed these emerging insurtech risks, ultimately preventing a $1.3M coverage gap.

Specialists shine brightest when structuring coverage for complex risks. 

This is where the real difference emerges in insurance.

Take Errors & Omissions (E&O) coverage. This perfectly demonstrates where specialists prove their worth.

To get E&O right, a broker must truly understand your professional services.

The advice you give, the trades you make, how you manage assets, and all the ways you serve clients.

All these activities fall under "professional services" and need protection. 

Without deep industry knowledge, it's impossible to catch all your exposures in an E&O policy. You need a broker partner who understands what you do for clients as well as you do.

2. Specialists Create Superior Policy Language

The clearest proof of specialist value is in the policy itself. This is where we go deep on coverage.

Specialists craft custom manuscript forms specific to your industry.

• They know which carrier forms have problematic exclusions for your operations

• They understand how to structure multi-layer programs that respond correctly

• They negotiate terms that align with how your business actually operates

PROBLEMATIC LANGUAGE EXAMPLE

A standard carrier form often excludes:  

"claims based upon or arising from the underwriting of any insurance policy or any other insurance or investment product including without limitation the classification, selection, pricing, or renewal of risks or to the determination of rates or premiums.” 

For insurance companies, this seemingly common exclusion could devastate coverage.

Because most claims arise out of an error which relates to the underwriting and handling of their insurance policies. 

Our specialist form specifically addresses this risk.

We offer our clients a Lloyd's manuscript form – a policy we've written ourselves specifically for Insurance Companies. 

At just 30 pages (versus standard 200-page policies), it's clearer, more protective, and easier to work with during claims.

Here's a key difference in how policies get made

This fundamental difference matters enormously. 

Our Lloyd’s forms are not only easier to understand but also work better when claims happen.

3. Specialists Build Tools Just for Your Industry

Specialist brokers create support tools specific to your industry. 

These client support tools help you:

• Know what coverage to buy

• How much you need

• What it should cost

• How you compare to similar firms

• What claims to worry about

• What articles to be reading about your space

Our peer data and benchmarking compares you only to similar firms. 

We don't focus on what's happening in unrelated industries – we concentrate only on what matters to you.

These industry-specific tools help you make smarter, data-driven decisions about your coverage. They're the second most important way we differ from generalists, right after our superior coverage expertise.

4. Specialists Staff Industry Experts

Our team works only with financial institutions. 

They don't get pulled into other industries or distracted by unrelated concerns.

This creates a high-performance team that:

• Speaks your language fluently

• Understands your challenges without explanation

• Knows what matters most to your business

• Recognizes industry patterns faster

• Is well versed in claims’ trends impacting your space

TEAM EXPERTISE COMPARISON

You get faster, smoother service because our people know your world inside and out. 

The day-to-day service flows more smoothly because we're operating in the same context you are.

5. Specialists Handle Claims Better

Having managed over $250 million in claims for financial institutions, we know how claims work in your industry. 

This experience means we're never learning on your dime. We've lived through these scenarios many times.

CASE STUDY: THE $4.2M CLAIM RECOVERY

A contractor-focused MGA hired a generalist broker who missed a critical "third-party distribution" exclusion. 

When a $4.2M claim arose, our specialist team reframed the issue around underwriting authority instead of distribution methods, securing full coverage that would have been denied.

This distinction, apparent to insurance specialists but overlooked by generalists, made the difference between financial disaster and full protection.

We recover more money more effectively because we've seen similar situations play out repeatedly. 

This experience helps us:

• Navigate the claims process faster and more confidently

• Advocate more effectively with carriers

• Anticipate and counter common objections

• Deliver better outcomes when you need to file a claim

The claims process is where insurance proves its worth. 

All the premium dollars in the world don't matter if your claim gets denied or delayed. Our claims expertise ensures you get what you paid for when you need it most.

Ready to transform your corporate insurance program? Let's talk.

Identifying Coverage Holes Before They Cost You

One of the most critical functions of a specialist broker is identifying coverage gaps before they become costly problems. 

Here are the most common coverage holes we find when reviewing financial institution policies:

Common Coverage Gaps in Financial Institution Policies

1. Professional Services Definition Misalignment

2. Regulatory Investigation Gaps

3. Third-Party Service Provider Exposure

4. Insured vs. Insured Exclusion Problems

5. Multi-Policy Coordination Failures

A specialist broker doesn't just identify these gaps—they close them with precise policy language modifications, proper program structuring, and carrier selection based on claims handling approach rather than just price.

Ready to transform your corporate insurance program? Let's talk.

How to Evaluate Your Current Broker

Not sure if your broker is a specialist or a generalist? Ask these five questions…

1. What percentage of their business comes from your specific industry? (Look for at least 50%)

2. Can they provide industry-specific benchmarking data from companies matching your size and structure?

3. Do they have proprietary manuscript forms specifically designed for your industry?

4. Can they describe, in detail, how your professional services differ from other financial institutions, and how that affects your E&O exposure?

5. How many claims similar to your potential exposures have they handled in the last three to five  years?

The answers will tell you whether you're working with a true specialist or a generalist with some industry experience.

How to Make the Shift from Generalist to Specialist Broker

Moving from a generalist to a specialist broker doesn't have to be disruptive.

• Start with a coverage review to identify gaps and improvement opportunities

• Consider splitting your program, letting specialists handle the complex financial lines

• Use your next renewal as an opportunity to test a specialist's market access and expertise

Most of our clients find that the transition costs are recovered within the first year through premium savings (average 18% reduction) and improved coverage benefits.

The top specialists will show their value before you make a commitment.

Ready to transform your corporate insurance program? Let's talk.

The Bottom Line

The gap between specialist and generalist brokers isn't just marketing talk. 

To return to the medical analogy, it's the difference between a doctor and a heart surgeon. 

When you have specialized needs, you need specialized solutions.

Specialists operate in your world, know your risks more deeply, and deliver superior results through:

• Smarter coverage design based on true risk understanding

• Clearer, more protective policies written for clients, not carriers

• Tools and benchmarks built just for your industry

• Teams that speak your language and know your challenges

• Claims experts who've seen and solved your specific problems before

When your financial security is on the line, doesn't it make sense to work with brokers who focus solely on protecting businesses just like yours?

Stay covered,

Natasha & Mark

Co-Founders and Managing Partners

LION Specialty

P.S. Want to see how specialists approach D&O coverage? 

Get our free "D&O Contract Vigilance Blueprint" - a 5-day course that reveals the 5 deadly mistakes that leave directors and officers exposed to unseen risks. 

Learn how to bulletproof your D&O policy and protect your leadership from catastrophic coverage gaps. Get the free course here

Access Our Past Blogs Here:

• ​4 Claims Advocacy Lessons​

• ​Our 10-Step Plan for Claims Recoveries​

• ​Insurance Coverage Guide​

• ​Financial Institutions Coverage Deep Dive​

• ​Everything About Insurance Coverage Part 2​

• ​Advanced Coverage Strategies