What will the future of the insurance industry look like? This is a question posed by many, following the terrorist attacks on New York and Washington. In the short term, we will see firms struggle to hang on. In the medium term, the strugglers will find themselves vulnerable to mergers and acquisitions. Admittedly, brokers and insurers were already consolidating. But the New York tragedy will speed the process up.

One of the more intriguing visions of the future has been pioneered by Euclidian and is now being followed by Peter Cullum's Towergate. This week, the underwriting agent bought top 50 insurer Folgate (see our front page lead story). Add this to its network of regional underwriting agents and brokers and you have a remarkable insurance provider.

The company underwrites more than £200m of gross premium a year and aims to double this in three years. Now the company will bolt on £50m gross written premium per year from Folgate.

The Folgate deal is especially important for companies like Towergate right now. Capacity is incredibly scarce. Many Lloyd's underwriters have precious little capacity left until the New Year releases next year's capacity. Towergate doesn't want to get snookered.

Nowhere is the capacity problem faced by Towergate more apparent than at Lloyd's (see page 2).

Managing agency XL Brockbank has asked all its agents to show risks before binding them in. Brockbank has deals with many agents in the US, so that means thousands of documents being sent back and forth before the risk can be signed off.

What's more galling is that many of Brockbank's agents deal in personal lines business. Underwriters feel in control, but agents must be frustrated.

Maybe Towergate has seen this future and wants no part of it.