The soft market is disproportionately affecting underwriting agencies, says Underwriting Agencies Council Chairman Murray Rogash.

Speaking to a CPA insurance conference in Sydney, Mr Rogash said underwriting agencies are not able to balance underperforming portfolios against other lines in the same way as insurers. They therefore need to be disciplined and selective in their approach, particularly in a soft market.

"This does not mean ceasing to write high-risk, hard-to-place business, but the business must be underwritten properly, at a premium commensurate with the risk, and risk management introduced," Mr Rogash said.

"It should be balanced with a proportion of lower-risk business being offered by the same brokers or they risk losing access to that market."

Mr Rogash warns that underwriting agencies cannot afford to be complacent. "We have to continue to perform or we will go out of business," he said.

Underwriting agencies' aggregate income has risen from less than $100 million to more than $1.5 billion in the past decade.