IBAMAG.COM ISSUE 7.03 | $12.95
Producers reveal the best places to go for help with hard-to-place risks CLEARED FOR TAKEOFF
Examining the major trends and challenges in aviation insurance
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WHAT’S ON THE RISK RADAR FOR 2019?
Insurers name the world’s biggest threats, from climate change to cybersecurity
INSURING THE UNTHINKABLE
How active assailant coverage is changing the game in special events insurance
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ISSUE 7.03
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CONTENTS
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UPFRONT 04 Editorial
How interconnectivity is intensifying every company’s exposures
06 Statistics
Climate change and cyber threats lead the way on the list of the most critical emerging risks FEATURES
THE MAIN EVENT
As active shooter incidents become all too common, special events coverage has been forced to evolve
SPECIAL REPORT
26 54
FIVE-STAR WHOLESALE BROKERS AND MGAs
Producers reveal which wholesalers have the best technical expertise, most responsive underwriting and more PEOPLE
INDUSTRY ICON
FEATURES
FLYING HIGH
Technology is changing both the aviation industry and the coverage for it, according to Jon Downey of AssuredPartners Aerospace
Zurich group chief risk officer Alison Martin reveals what the insurer has discovered about this year’s biggest risks – and how it’s responding
22 2
08 Head to head
Have the insurance industry scales tipped toward technology?
10 News analysis
The key threats brokers need to pay attention to in 2019 and beyond
12 Intelligence
This month’s big movers and shakers
14 Workers’ comp update
A new adjusting firm enters the USL&H workers’ comp space
16 Technology update
How technology is helping curtail losses in marine insurance
20 Opinion
Insurtech is just the latest step on the ladder of industry technology
FEATURES 56 Five-star growth
Strategic acquisitions have helped JenCap Holdings increase its footprint in the wholesale space
PEOPLE 63 Career path
58
FEATURES
HOW TO GIVE FEEDBACK EFFECTIVELY
Five steps to delivering criticism that’s well-received
As he’s changed companies and specialties, Mike Levins has never lost his drive to build relationships
64 Other life
Dancing in the streets with broker and breakdancer Emmanuel Tomas
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UPFRONT
EDITORIAL
No silver bullet in an era of risk
N
o matter which side of the political fence you find yourself on, there’s little doubt that relations between the world’s superpowers have rarely been more strained than they are now. Add to that the extreme weather that has hit all corners of the globe over the last year – from Hurricanes Florence and Michael in the US to hailstorms in Australia, windstorms in Canada and wildfires in California – and the ever-expanding threat of cyber attacks, and it’s clear that companies need to be more vigilant about risk management than ever before. “In today’s interconnected world, no company is really insulated from what’s going on in other parts of the world,” Barry Franklin, head of risk for Zurich North America, told Insurance Business America in February. “You may think you are, but your suppliers probably have some connections or some dependencies on supply chains in other parts of the world. Because of the fact that we’re so interconnected, no company can just go on and assume that these things that happen in other parts of the world won’t affect them.”
“In today’s interconnected world, no company is really insulated from what’s going on in other parts of the world” Getting that message across to clients, of course, is not easy, but it’s a reality brokers must emphasize. Heightened cyber and technological threats, for example, were identified as a major blind spot in the World Economic Forum’s recent Global Risks Report; many businesses don’t yet comprehend the vulnerability of networked societies. Giles Crowley, head of commercial at Zurich Australia, told IBA that as climate risks in particular become more important for businesses, the broker’s role will continue to develop. “Brokers have a significant responsibility in terms of educating and helping their clients scan for all forms of risk, climate risk included,” Crowley said. “Talking to clients about their strategies to mitigate climate risk, and bringing global insights and research to the table, is hugely valuable.” Whether it’s extreme weather, cyber risks, political issues or anything else that could disrupt operations in today’s interconnected world, brokers need to stress the importance of risk management and mitigation. There is no silver-bullet solution to this litany of problems – but training and education are the building blocks that will help your clients avoid unnecessary exposure and understand the value of the service you provide. The team at Insurance Business America
www.ibamag.com MAY 2017 EDITORIAL
Managing Editor Paul Lucas Journalists Alicja Grzadkowska, Nicola Middlemiss, Bethan Moorcraft, Ksenia Stepanova News Writers Lyle Adriano, Krizzel Canlas, Terry Gangcuangco, Mina Martin, Gabriel Olano Staff Writers Tom Goodwin, Libby MacDonald, Joe Rosengarten, Ryan Smith, Heather Turner Copy Editor Clare Alexander
CONTRIBUTORS Frank Sentner, Aytekin Tank
ART & PRODUCTION Designer Joenel Salvador Production Manager Alicia Chin Traffic Manager Ella Dayandante
SALES & MARKETING Vice President, US Market Cathy Masek Vice President, Sales John Mackenzie Media Sales Managers Chris Anderson, Desiree McCue Mktg & Comms Manager Lisa Narroway
CORPORATE Chief Executive Officer Mike Shipley Chief Operating Officer George Walmsley President Tim Duce Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil Editorial Inquiries paul.lucas@keymedia.com Subscription Inquiries subscriptions@keymedia.com Advertising Inquiries cathy.masek@keymedia.com, chris.anderson@keymedia.com, desiree.mccue@keymedia.com Key Media 78O7 E. Peakview Ave., Suite 115 Centennial, CO 80111, USA tel: +1 720 316 0151 www.keymedia.com Offices in Denver, London, Toronto, Sydney, Auckland, Manila, Singapore, Bengaluru, Seoul
Insurance Business America is part of an international family of B2B publications, websites and events for the insurance industry Insurance Business Canada john.mackenzie@kmimedia.ca T +1 416 644 874O Insurance Business UK nathan.beach@keymedia.com T +44 20 7193 0935 Insurance Business Australia peter.smith@keymedia.com.au T +61 2 8437 47OO Insurance Business NZ peter.smith@keymedia.com.au T +61 2 8437 47OO Insurance Business Asia peter.smith@keymedia.com.au T +61 2 8437 47OO Printed in Canada Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as the magazine can accept no responsibility for loss.
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© 2019 Burns & Wilcox. All rights reserved.
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UPFRONT
STATISTICS
A climate of risk
NORTH AMERICA
1. Climate change 2. Cybersecurity risks 3. Volatility of the geopolitical landscape 4. Social discontent and local conflicts 5. Medical innovations and use of technology in healthcare
Climate change and cybersecurity aren’t new risks, but they are becoming more urgent For the third year in a row, climate change and cybersecurity have topped the list of the world’s biggest emerging risks. What’s notable is that the margin by which these two categories have been singled out in AXA’s annual Emerging Risks Survey has almost doubled over the last year, indicating the urgency with which both risks are regarded.
90%
of professionals said physical risks are their main concern about climate change
72%
said the rise of nationalism and populism is the biggest geopolitical threat
Sixty-three percent of the professionals surveyed named climate change among their five biggest emerging risks, up from 39% in 2017. Meanwhile, 54% of respondents put cybersecurity in the top five, up from 34% the previous year. Rounding out the list of the top five most critical emerging risks were volatility of the geopolitical landscape, natural resources management and social discontent.
49%
of respondents named overconsumption as the top risk to natural resources
40%
said growing economic inequality is the major factor contributing to the risk of social conflict
THE WORLD’S BIGGEST EMERGING RISKS Climate change and cybersecurity ranked as the top two emerging risks in every region of the world; the Middle East stands alone in placing cyber risks ahead of climate change. Social discontent and local conflicts were also a top-five risk in nearly every region of the world, although the importance varied by location. Europe, Asia, and Central and South America also expressed growing concern about the rise in artificial intelligence and Big Data.
Source: AXA Emerging Risks Survey 2018
THE TOP 10
GROWING CONCERNS
Climate change and cybersecurity held their positions as the top two emerging risks worldwide, while geopolitical volatility and social discontent have both climbed several notches since 2017.
The percentage of respondents who included climate change, cybersecurity and geopolitical volatility as one of their top five emerging risks has risen markedly since last year. As for risks that have declined, respondents felt financial and macroeconomic risks aren’t as pressing a concern a decade after the global financial crisis.
1. Climate change 2. Cybersecurity risks
60%
3. Volatility of the geopolitical landscape 4. Natural resources management
Percentage who named it as a top-five risk in 2017
40%
6. Artificial intelligence and Big Data
30%
7. New threats to security
20%
10. Pandemics and infectious disease Source: AXA Emerging Risks Survey 2018
63% 54%
50%
5. Social discontent and local conflicts
8. Pollution 9. Medical innovations and use of technology in healthcare
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Percentage who named it as a top-five risk in 2018 70%
39%
34%
20%
10% 0%
31%
Climate change
Cybersecurity
Volatility of the geopolitical landscape
26%
25%
25% 16%
Natural resources management
Social discontent and local conflicts Source: AXA Emerging Risks Survey 2018
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EUROPE
1. Climate change 2. Cybersecurity risks 3. Volatility of the geopolitical landscape 4. Social discontent and local conflicts 5. Artificial intelligence and Big Data
MIDDLE EAST
1. Cybersecurity risks 2. Climate change ASIA
3. Natural resources management 4. Volatility of the geopolitical landscape Social discontent and local conflicts
CENTRAL AND SOUTH AMERICA
1. Climate change 2. Cybersecurity risks 3. Artificial intelligence and Big Data 4. New threats to security 5. Medical innovations and use of technology in healthcare
1. Climate change 2. Cybersecurity risks 3. Natural resources management 4. Social discontent and local conflicts 5. Artificial intelligence and Big Data
AFRICA
1. Climate change 2. Cybersecurity risks 3. Social discontent and local conflicts 4. New threats to security 5. Macroeconomic risk
Source: AXA Emerging Risks Survey 2018
THE PACE OF EMERGENCE Climate change is a pressing issue: More than half of respondents said this risk has already emerged, while around a third consider it to be rapidly emerging. Cybersecurity, meanwhile, continues to be classified as a rapidly emerging risk; 54% of the professionals surveyed put it in that category. Climate change
Already there
36%
13%
Cybersecurity risk is multifaceted, but respondents identified three main areas of concern: attacks on critical infrastructure, attacks on connected devices, and new types of malware.
54%
13%
40%
Rapidly emerging
51%
DIVERSE CYBER CONCERNS
Slowly emerging
Cybersecurity
33% Volatility of the geopolitical landscape
32%
32%
30%
45%
38%
17%
21%
20%
Natural resources management
45%
35%
20%
40%
21%
Social discontent and local conflicts
10% 0%
39%
Source: AXA Emerging Risks Survey 2018
Cyber-physical attacks on infrastructure
Attacks on connected devices
New types of malware
Source: AXA Emerging Risks Survey 2018
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UPFRONT
HEAD TO HEAD
Has insurance become too reliant on technology? The industry seems to have finally warmed to tech – but has it truly reached a tipping point yet?
Pascal Millaire
CEO CyberCube Analytics
Laird Rixford
CEO Insurance Technologies Corporation
Armand Ferranti
“Not only are insurers not too reliant on technology, they are insufficiently reliant on technology. According to Deloitte, insurers spend 3.6% of revenues on technology versus 7.2% for other financial services segments. This manifest itself in cumbersome human interactions for customers, highly manual processes for insurance staff and inflated expense ratios. But the future looks bright. Not only will new technology tools enable insurance professionals to focus on higher-value and more interesting work, but over time, internet-connected technologies are creating a once-in-a-lifetime opportunity for carriers to insure against new technology risk pools.”
“I would say the industry is not reliant enough on technology. There are parts of the industry that are making good use of technology. And then there are parts that are still relying on old legacy processes that have a lot of room for improvement – for example, requiring a signature to bind a policy rather than using e-signature technology. Technology is a necessity of the modern business world, especially in insurance. The efficiencies, cost savings, data and business insight that technology can provide will make us better as an industry and help us all to grow.”
“Not at all. Contrary to all the innovation and insurtech news we read today, many insurers continue to operate in the traditional environment. But we’re certainly in a transitional period. Technology is starting to heavily assist insurance businesses, empowering underwriters to make wiser, data-driven decisions; enabling a closer interaction with clients; providing ways to understand risks better; and more. Legacy systems and manual processes are still very much at the core of operations. The trend certainly indicates that tech can improve expense ratios and efficiency. It’s only a matter of time before more companies adopt these solutions.”
Accelerate partner AXA XL
AN UNEVEN APPROACH A survey of insurance CEOs conducted by KPMG in 2017 revealed that 69% plan to invest in digital infrastructure by 2020; of those, 59% said the primary objective of their investment is to transform their business and operating models. High-profile disruptor Lemonade is leading the curve with its claims bot, AI Jim, which can decide on and pay out a claim in less than three seconds, cutting out the traditional paperwork. But other insurers’ back-office processes remain enmeshed in legacy systems, which “have not kept pace with innovation,” according to Anders la Cour, co-founder and CEO of Banking Circle. “Today, outdated payment architecture has a stranglehold on the insurance industry, holding it back from providing policyholders with the most efficient service.”
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UPFRONT
NEWS ANALYSIS
The top risks for 2019 The risk horizon for this year and beyond shouldn’t surprise anyone in the insurance industry, but the intensification of key threats should be on brokers’ radars
THE BEGINNING of a new year brings a slew of annual reports from insurance industry giants on the key risks that busi nesses and their insurers need to watch out for in the coming year. While the threats them selves aren’t new – cyber, natural catastro phes and business interruption continue to top the lists – the fallout from these risks is intensifying as the world becomes ever more interconnected. According to the 2019 Allianz Risk Baro meter, business interruption has surpassed cyber incidents as the biggest risk to busi nesses in the US, highlighting the growing number of exposures that can leave compa nies vulnerable. “With the global economy, situations with supply chains, and more mergers and acqui
standing who are your key suppliers, who are the key entities that you’re working with – understanding those and [determining] what is your backup plan, what are the things that you need to do from a business continuity approach to ensure that you’re able to deliver your products or deliver your solution, what ever that may be.” Business interruption has been one of the top risks on the Risk Barometer for several years now, which underscores the threat of the unknown that’s bearing down on insureds. The percentage of loss tied to business interruption is creeping up, particu larly as it relates to property damage – AGCS reports that the average business interruption property insurance claim now totals more than $3.4 million. Other major threats also
“The risks in 2019 look an awful lot like they did in 2018, but I think a couple of them in particular are more prominent” Kathryn Tazic, Sedgwick sitions happening, I believe that to some degree, a good understanding of the expo sures that your business faces is going to be essential to being successful going forward,” says Thomas Varney, regional manager for the Americas at Allianz Global Corporate & Specialty [AGCS]. “By that I mean under
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have connections to business interruption, such as cyber incidents, which tied for first place on the 2019 Risk Barometer. “As we become more of a digital world and there are more aspects of technology [involved in] ordering products or doing different things online as opposed to by snail
mail,” Varney says, “I think that it’s not just about understanding the exposures that those create, but also really internal training of your staff and understanding that at times, there can be hackers, but what are you doing inter nally to assure that you’re protecting your system from the inside?” Preparing for cyber events is already top of mind for many insureds, who are taking advantage of the expanded suite of insur ance products available today to prepare for this eventuality. “We know that cyber attacks are now more of a ‘when’ rather than an ‘if,’ so all of our customers are concerned about that,” says Kathryn Tazic, managing director at Sedgwick. “I would say they are taking greater steps than they have in the past, both from an insurance-buying perspective – in the kinds of policies that are being written and they have to buy – and importantly, in the length that they’re going to from a security perspective to
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2019’S TOP 10 THREATS AT A GLANCE
1. Business interruption 2. Cyber incidents 3. Natural catastrophes 4. Changes in legislation and regulation 5. Market developments 6. Fire/explosion 7. New technologies 8. Climate change/increasing volatility of weather 9. Loss of reputation or brand value 10. Shortage of skilled workforce Source: Allianz 2019 Risk Barometer
make sure that they’re prepared in the event of that kind of [attack].” In its forecast for the year ahead, Sedgwick pointed out that the sharing economy and an evolving workforce will also have implications for insureds and their insurance partners.
somebody might have an accident, but they’re working in a shared [economy] environment, what does that mean? We have a lot of employers that are coming together on those items, and [we’re] really having to think through how we manage that risk when
“It’s not just about understanding [your digital exposures], but also really internal training of your staff” Thomas Varney, Allianz Global Corporate & Specialty “We’re talking a lot about the way that people are accessing services, whether that’s some of the larger retailers taking advantage of services like Uber or Lyft to deliver packages, or other companies that are coming up in our world that take advantage of that contractor employee,” Tazic says. “When
they might be contractors, not employees.” The faces of these employees also look a lot different than they did a few years ago; workers today range from teenagers to octogenarians. “We do a lot of work with employers around safety,” Tazic says, “both for those
younger workers as well as workers in their 50s and above, but that generational change requires our employers to think through everything, from the way they train on safety to the way they communicate upfront. Then there are a lot of documented statistics about the risks to employees as they age, and [we] continue to see a lot of work being done on the employers’ side in their concern around how we best care for people at whatever age they are.” Sifting through the risk projections for 2019 likely won’t reveal many surprises for insurance professionals, but these forwardlooking analyses do emphasize the importance of keeping a vigilant watch over the known and unknown threats impacting clients. “The risks in 2019 look an awful lot like they did in 2018,” Tazic says, “but I think a couple of them in particular are more prominent and continue to be more prominent than others.”
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UPFRONT
INTELLIGENCE CORPORATE ACQUIRER
TARGET
PRODUCTS COMMENTS
Alera Group
Whipple & Company
Florida-based Whipple & Company focuses on employee benefits, with expertise in carrier negotiations, compliance and wellness
Auto-Owners Insurance
Capital Insurance Group
CIG is a regional property & casualty insurer serving the Western US
Brown & Brown
Smith Insurance Associates
Pennsylvania-based Smith Insurance is known for its expertise in multifamily residential, hospitality and commercial structures
Gallagher
Surety Solutions and Agency Multiplied
Surety Solutions specializes in surety bonds; Agency Multiplied is the developer of its bond processing software
GTCR
AssuredPartners
The sale of the brokerage to private equity firm GTCR is reportedly worth $5.1 billion
NFP
Mass Insurance Brokers and Easyway Insurance Brokers
The two P&C brokerages are based in Markham, Ontario
Ryan Specialty Group
Myron F. Steves & Company
Myron Steves will become part of RT Specialty, the wholesale brokerage unit of RSG
USI Insurance Services
US Risk Insurance Group
US Risk is one of the biggest P&C program and specialty brokerage firms in the US
Travelers enhances jewelry coverage
Travelers is now offering fine jewelry policies through its Wedding Protector Plan, allowing couples to protect their engagement rings and/or wedding bands with their wedding insurance plan. The policies include coverage limits of up to $100,000, considerably higher than the average limits for jewelry on a homeowner’s policy. “Adding a jewelry policy with the updated Wedding Protector Plan can give couples peace of mind so they can focus on building their future together,” said Travelers managing director Todd Sasha.
AssuredPartners gets new ownership
Apax Partners has agreed to sell its entire stake in insurance brokerage AssuredPartners to an investor group led by GTCR, the private equity firm that originally sold AssuredPartners to Apax. GTCR had owned AssuredPartners from its inception in 2011 until 2015, when it sold the business to Apax. At that time, AssuredPartners was valued at around $1.7 billion; according to a source familiar with the matter, the current valuation of AssuredPartners is around $5.1 billion. The deal is expected to close in the second quarter of the year. GTCR has plans to grow AssuredPartners through mergers and acquisitions, with a focus on developing insurance for niche markets such as aviation, senior living, healthcare and public entities.
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Nationwide launches payas-you-go auto insurance
Nationwide Insurance has launched a new telematics-driven pay-as-you-go auto insurance solution called SmartMiles, which is geared toward low-mileage drivers. “SmartMiles was developed to provide a program that allows our customers the freedom to control their auto insurance expenses based on how much they drive and how safely they drive,” said Nationwide AVP Teresa Scharn. “Whereas most insurance companies’ mileage-based insurance programs look only at miles driven, Nationwide’s SmartMiles telematics program takes many factors into account, creating a more personalized offering.”
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PEOPLE Ironshore enhances storage tank policy
Ironshore Environmental has beefed up its storage tank policy’s third-party bodily injury and property damage coverages to protect against risks such as natural resource damages and medical monitoring. The company has also rolled out a new online broker portal that makes it easier for brokers to quote and bind storage tank policies. “With this product offering and our online portal, businesses with storage tank exposures can quickly and easily secure reliable coverage through one carrier, backed by Liberty Mutual and Ironshore’s expertise and financial security,” said Ironshore Environmental president Toby Smith.
QBE partners on lawyers’ professional liability
QBE North America has announced a partnership with Florida-based program manager LawyerGuard to provide professional liability coverage to lawyers that addresses the unique legal malpractice exposures faced by law firms. Targeting multiple practice areas, the program focuses on firms with one to 100 attorneys and provides a broad range of coverages in most states. “Together with LawyerGuard, we look forward to helping our customers protect against the growing number of malpractice risks that they face,” said QBE North America SVP Erin Fry.
Berkshire Hathaway simplifies SME coverage
Berkshire Hathaway has launched THREE, a program that brings together workers’ comp, multiple liability coverages (including general liability, E&O and cyber), property and auto insurance into a single package for small and medium-sized businesses. “Insurance is important protection for any business, but few small businesses have the time to actually read through the policy forms that are supposed to protect them,” said Berkshire Hathaway chairman Warren Buffett. “With THREE, a small business can be confident in the protection it is getting because the whole policy can be read in a few moments.”
NAME
LEAVING
JOINING
NEW POSITION Deputy head of management liability commercial for financial lines, North America, and regional head of financial lines, South America
Alessandro Carriglio
N/A
Allianz Global Corporate and Specialty
Mark Cloutier
Brit
Aspen Insurance Holdings
Executive chairman and group CEO
Jean-Paul Conoscente
N/A
SCOR
CEO of SCOR Global P&C
Katie Fioretti
N/A
Allianz Global Corporate & Specialty
Regional head of management liability commercial for financial lines, North America
Lambros Lambrou
N/A
Aon
Global CEO, Commercial Risk Solutions
David Lawrence
N/A
SSL Endeavour
Group CEO
Mark Maher
NIF Group
JenCap Holdings
COO
Jayme Mendal
N/A
EverQuote
Chief operating officer
Jose Palmer
Upstream Brokers
EPIC Insurance Brokers and Consultants
Principal
Robert Quane
AIG
Axis Capital Holdings
Head of underwriting
Joseph Stanoch
Burns & Wilcox
RFIB Group
Managing director, RFIB Americas
Joe Zuk
Atlas General Holdings
Orchid Underwriters Agency
Managing director of corporate development and strategy
AGCS promotes financial lines execs
Allianz Global Corporate & Specialty has announced the promotions of two executives in its North American financial lines division. Katie Fioretti (pictured) has been named regional head of management liability commercial [MLC] for financial lines in North America. Based in New York, she will oversee management liability lines, including D&O, EPL, fiduciary and crime, for all commercial clients in North America. Alessandro Carriglio will take on the dual role of deputy head of MLC for financial lines in North America and regional head of financial lines in South America. Carriglio was most recently the deputy global head of financial lines commercial, based in Munich. Before that, he was financial lines MLC manager for AGCS’ Milan location.
JenCap names new COO
Specialty insurance distribution platform JenCap Holdings has named Mark Maher as its new chief operating officer. Maher was previously the president of NIF Group, an MGA, program manager and wholesale insurance brokerage under the JenCap umbrella. As COO, Maher will work with JenCap’s management team to develop strategic plans, manage carrier and key broker relationships, and work with divisional business leaders to achieve an effective cross-sale protocol while maintaining a high service level throughout the organization.
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UPFRONT
WORKERS’ COMP UPDATE NEWS BRIEFS Cerity launches with direct-toconsumer model for workers’ comp
There’s a new insurance startup on the scene with a distribution model that enables small businesses to apply for workers’ comp policies online in as little as five minutes. Workers’ comp insurtech firm Cerity not only leverages an online platform for direct sales, but also assigns rates based on a proprietary model that predicts risk and evaluates pricing based on 100 different tiers. “Everything that we’ve done, from the front end to the back end, has been designed and orchestrated with the customer in mind to make it easy for them to transact,” said Cerity SVP and COO Dennis Dix.
FBI targets nationwide workers’ comp fraud scheme
The FBI is investigating a suspected nationwide workers’ compensation fraud scheme. Authorities have advised businesses that purchased workers’ compensation, group health insurance and pension plans from American Labor Alliance [ALA] or one of its many subsidiaries nationwide to contact their state insurance regulator to validate their policies. ALA has been the subject of controversy since January, when a 14-count federal grand jury charged the company and two of its executives with mail fraud, conspiracy to commit mail fraud and money laundering. Court documents allege that ALA and its subsidiaries sold workers’ compensation coverage that may not actually provide coverage at all.
Berkshire Hathaway might be looking to sell WC unit
Berkshire Hathaway is allegedly in advanced discussions to sell its workers’ compensation unit, Applied
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Underwriters, to a consortium of insurance firms. Applied Underwriters provides bundled workers’ compensation and financial services solutions for small and medium-sized businesses across the US. Sources familiar with the matter told Reuters that the San Francisco-based firm sits outside Berkshire Hathaway’s insurance focus, making it a non-core asset Warren Buffett wishes to divest. A group of insurance firms and a hedgefund-backed reinsurance firm are said to be in talks to buy the unit.
Texas marine firm charged with workers’ comp fraud
Houston-based vessel repair and marine services firm Alpha Mar pleaded guilty to a first-degree felony on workers’ compensation fraud charges and has been ordered to pay $250,000 in restitution to Texas Mutual Insurance. Owner John Stergiou was found to have misrepresented Alpha Mar’s payroll to Texas Mutual from 2008 to 2012. Stergiou also falsified and concealed some of his and other related companies’ operations from the insurer. Stergiou’s scheme allowed Alpha Mar to be charged a lower premium than it actually owed.
Football team forced to move training to secure coverage
The Orlando Apollos, a team in the fledgling Alliance of American Football [AAF], has been forced to move its training across state lines to Georgia because of Florida’s workers’ compensation law, which excludes professional athletes on the grounds that they’re not considered employees. Because the AAF is still relatively new, it has not yet found an insurance provider willing to cover every team. AAF CEO Charlie Ebersol told the Orlando Sentinel, “Our responsibility is always to do what we must do to make sure our players have the best available coverage.”
Preparing for the future A newly launched workers’ comp claims adjuster aims to simplify the claims process in the USL&H space Signal Mutual, the largest provider of longshore and harbor workers’ compensation benefits in the US, has announced the launch of Sage Adjusting in collaboration with its manager, Charles Taylor. The new firm is a combination of Signal Mutual’s four largest independent third-party USL&H workers’ compensation firms: Charles Taylor TPA, Lamorte Burns, AS&G Claims Administration and Acclaim Risk Management. It will operate as a single entity aligned with and controlled by the Signal Mutual Indemnity Association and Charles Taylor. According to Christopher Schaffer, CEO of Charles Taylor TPA and Sage Adjusting, the new firm provides a viable framework to advance technology applications, enhance resources and share expertise in workers’ compensation claims administration. “Unlike most forms of workers’ compensation, the cost of claims in the longshore and harbor space is typically our clients’ largest variable cost,” Schaffer says. “It’s the factor, in a competitive environment, where they’re most equal to their competitors, but if they manage claims properly, they can gain a competitive advantage. We need to collaborate and partner with our clients to improve their claims experience, and we need to do that at a price that’s reasonable, competitive and gives clients value for their money.” Claims adjusters in the USL&H workers’ compensation space today are facing increas-
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ingly sophisticated challenges, and Schaffer believes technology can be the gamechanger. Insurance companies that don’t invest in or apply technology at the claims adjusting stage are quickly falling behind, he says. “It’s not just about analyzing data in the rearview mirror; it’s about taking predictive analytics, artificial intelligence and machine
Q&A
John Swigart Co-founder and CEO PIE INSURANCE
“Adjusters can start focusing their work … on the key decision points that can really impact the outcome of a claim” learning to a new level of sophistication,” he says. “There’s much of the claims process, even in workers’ compensation, that can be driven by computers in a way that you can still have the benefit of the experienced, quality claims adjuster, but that adjuster is equipped with more information to make better decisions. Adjusters can start focusing their work not on the administrative burdens of workers’ compensation, but on the key decision points that can really impact the outcome of a claim.” Preparation for the future underpins Charles Taylor and Signal Mutual’s decision to launch Sage Adjusting. Schaffer explains that the company plans to pool its collective resources to train future leaders in USL&H workers’ compensation space in order to maintain its leadership position. “Insurance companies have to apply that technology, apply a new way of thinking and bring their adjusters along with them on the technology journey,” Schaffer says. “We handle claims much differently today than we did 20 years ago, and we need to train new adjusters differently so they can handle claims over the next 20 years.”
Years in the tech industry 21 Fast fact Pie Insurance recently raised $45 million in a Series B funding round, bringing its total funding to $61 million
Underserved and overcharged What is Pie Insurance? Pie Insurance is a digitally native insurtech startup that provides workers’ compensation insurance directly to small businesses. We’ve built a full-stack MGA operation that leverages data analytics to more accurately identify risk for small businesses and to create an insurance model that’s as easy as pie.
Why are you targeting small business owners? Our average customer has about $150,000 in payroll, which is about three to five employees. Most insurance agents struggle to serve clients of that size efficiently because there’s hardly any commission revenue in it. In fact, a lot of insurance companies won’t even sell to businesses of that size, which means the small business market is generally underserved today. Our very first customer who bought from us was out in the market having to shop because their current provider wasn’t renewing their policy because it was less than $10,000 in premium. That’s a microcosm of how small business owners are underserved by insurance companies with minimum premium thresholds and cutoffs. According to our predictive model, the small businesses that can get coverage are generally overpaying, often by as much as 30%. Smaller businesses are generally less risky overall, but that reality is not reflected in their insurance prices because the bigger, more traditional insurance companies are not operating with technical efficiency and have very high expense ratios. Those higher expense ratios disproportionately impact smaller coverages. If I’m an insurance company and I’m selling a $100,000 policy, there are enough premium dollars there for my human-based expenses and inefficient processes to get covered. But if I’m selling a $750 policy, the proportion of my expenses I’m loading into that policy are greater, and the customer ends up paying for that.
Why does Pie’s model work well for small businesses? The small business owners that we’re targeting wear a lot of different hats. They can manage most of their business, from payroll to payment processing, in a digital fashion – and insurance should be no different. Most small businesses don’t file many workers’ compensation claims and therefore find it quite expensive. They almost view it like a tax, and if it’s hard to purchase and complicated to understand, the consumer experience is doubly bad. Our model removes these hurdles for small business owners.
Where does Pie operate? We launched in nine states in 2018 – Arizona, California, Colorado, Georgia, Illinois, Louisiana, North Carolina, Tennessee and Texas – and have added a further nine states so far in 2019: New York, Michigan, Pennsylvania, Maryland, Nebraska, Iowa, Kansas, Kentucky and New Mexico. We’re expanding as rapidly as we can, and we’re actively selling through digital channels directly to customers, as well as through select distribution partners.
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UPFRONT
TECHNOLOGY UPDATE
Diving deeper into technology Tech-driven loss prevention has the potential to transform how risk is managed in marine insurance
global marine practice leader at Marsh. “From an underwriting perspective, we’re looking at shipping information like the age of a ship, the cargo it’s transporting and its loss record. Moving forward, I think it’s very important that we get better data around the behavior of ships and their crews and how that starts to impact loss.” Ship owners can also invest in technology
“Moving forward, I think it’s very important that we get better data around the behavior of ships and their crews”
Technology is an essential tool for loss prevention in the global shipping industry. It can collect data about how ships are running, the cargo they’re carrying and the safety of the waters they’re navigating. Technology can also detect and analyze the behavioral and human aspects behind shipping accidents, which are the industry’s most common cause of loss, according to Richard Adler, senior vice president of the global marine practice at Marsh. “The primary root cause of accident in the shipping industry is human error – but tackling the human element is incredibly tricky,”
NEWS BRIEFS
Adler says, adding that tech is the key to any effective loss-prevention strategy. To that end, Marsh has launched a portal that gives ship owners the ability to access “the whole black box” of protection and indemnity [P&I] data, including financial and underwriting information from the 13 international P&I clubs. Marsh is also trying to encourage the clubs to be more transparent and collaborative with their data so that more ship owners can use it to their advantage. “At the moment, the P&I business is run on relatively static data,” says Marcus Baker,
Online tool connects consumers to local agents
Texas-based broker Frank Medina has launched a free online tool that allows consumers to search for reputable insurance agents in their area. The tool, called Insurance Agent Near Me, lists all the major insurance products that are being searched online daily, then points customers to agents based on their proximity and relevance to the search terms. Noting that Google searches can be frustrating, “we wanted to do something that addresses the challenges that customers face in finding local insurance agents,” Medina said.
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to improve their safety culture, Adler says. Modern sensor technology allows ship owners to draw up heat maps, carry out geofencing and do real-time loss prevention so they can take immediate mitigation measures. “The technology is there, so we have to embrace it,” Adler says. “Many of our ship owner clients support the investment because it brings so many advantages, not only in avoiding claims and accidents, but also from a commercial perspective. Today, you can look at a ship owner’s loss record and potentially compare it to a club’s overall record. Imagine if you could compare it against 95% of the world’s tonnage in the entire international group. The conclusions you might be able to draw from that can be exploited commercially.”
Mutual Underwriters rolls out new platform
Mutual Underwriters has moved its operations to the cloud-based InsuranceEnterprise platform, which allows for streamlined policy processing and includes a rating and rules engine that enables complex products to be deployed and maintained. Managing director Sean Murray said the move will allow the company to rapidly grow its business by managing products for multiple carriers across several states. “InsuranceEnterprise in the cloud maximizes our operating efficiencies and improves speed to market,” he added.
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UPFRONT
TECHNOLOGY UPDATE Q&A
Laird Rixford CEO INSURANCE TECHNOLOGIES CORPORATION [ITC]
Years in the industry 17 Fast fact The FAA estimates that 2.85 million small drones could fill the sky by 2022 – 450,000 of which will be used for commercial purposes
Drones will bring sky-high efficiency How is drone technology impacting the insurance industry?
Are there any risks that come with using drone technology?
Drone technology is impacting the insurance industry by making the process of property inspection more efficient, both pre- and post-loss. Underwriters can use drones to inspect a roof and the surrounding property or yard before underwriting a policy, and loss adjusters can use drones to get a better bird’s-eye view of a loss post-event. This applies to homes and commercial properties. Using drones is much more cost-efficient than having multiple people inspect a property or using helicopters and planes for aerial imagery, which can prove very costly.
One of the biggest issues is people’s reticence to having drones flying overhead because of privacy issues. Just because a drone is flying overhead, it’s not necessarily looking at you. It’s looking at a roof in the neighborhood, and it will be up and down within minutes, without a person having to walk over someone’s property – and yet people still think drones are spying, so we need more public education around that. Another thing to remember is that drones used in the insurance process are being used for commercial purposes, and therefore the operator is required by the FAA to have an Unmanned Aircraft Systems license before flying. An insurance agent can’t just fly a drone to look at something without being properly licensed by the FAA.
Are there any operational or employment challenges related to using drones? After a catastrophic event like a hurricane, insurers still have to send someone to the property to physically inspect the loss. We’re not yet at the point where the Federal Aviation Administration allows us to fly drones out of the sight of the operator, which means someone needs to be at the property to fly the drone and carry out the inspection. The drone gives you a better perspective on the loss, in addition to cutting costs. I don’t think drones will lead to a reduction of the insurance workforce. Rather, I think they will change some of the professions. You still need underwriters to analyze and process the data collected by the drone, and you still need someone to physically visit the property and operate the drone. It might just change the role requirements for some positions.
Solera acquisition bolsters property claims platform
Solera Holdings, a provider of intelligent data and software as a service [SaaS] for the automotive, home and identity sectors, has acquired in4mo, a European provider of SaaS-based software and services for the property insurance and repair professional markets. “We look forward to working with in4mo to expand our global property claims platform for insurers, extend our reach into the household and deliver even more innovative solutions to all participants in the asset-ownership marketplace,” said Solera CEO Tony Aquila.
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Moving forward, how do you expect the adoption of drone technology to continue in the insurance industry? As drones become smarter and are more readily accepted by the public, I think we’re going to get to a point where the FAA will allow drone usage beyond line of sight. That will enable insurance companies to dispatch drones to do an inspection or to look at claim damage from a central location without having to send someone along. That’s a lot further down the road, but that’s where using drones can improve operational efficiency within the insurance industry.
Lemonade competitor raises $25 million
Insurance startup Jetty National, which has been touted as a competitor to Lemonade, recently raised $25 million in Series B funding, led by Khosla Ventures. Other participants in the funding round included existing investors Valar Ventures and Ribbit Capital. Jetty offers renters’ insurance that covers risks such as bedbugs and electronic damage. Unlike other insurance companies, however, Jetty’s market strategy involves selling its products through landlords, who offer the insurance to tenants at the time of lease.
Duck Creek expands London market reach
Duck Creek Technologies has partnered with Web Connectivity Limited, a provider of ACORD standards-based solutions for the commercial insurance industry, to give customers expanded access to tools related to London market insurance operations, including a messaging function. “This is a significant step forward for us in terms of being able to provide our customers with a global on-demand SaaS platform that includes syndicate and London market company operations,” said Duck Creek’s Bart Patrick.
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UPFRONT
OPINION
GOT AN OPINION THAT COUNTS? Email iba@keymedia.com
Evolution, not revolution Insurtech has been praised for bringing technology to the insurance industry, but the technology has been there all along, writes Frank Sentner THE INSURANCE industry is all a-twitter (literally) about the insurtech revolution, but most of the folks involved in insurance technology today are unaware that insurance was an early adopter of technology. In the 1960s, Travelers installed one of the very first IBM mainframe computers, and its peers were not far behind. In the 1970s, I sold time-shared mini-computers roughly the size of a refrigerator to insurance agencies to do invoicing and accounting. At the time, only the largest agents could afford such technology. In the 1980s, the advent of personal computers launched a host of systems that boasted office automation capabilities in addition to accounting. For the first time, even the smallest insurance agencies could afford desktop computers to manage their work processes, and insurance agents were among the first small businesses to embrace this technology. Two disparate technological challenges confronted the insurance industry in the ’90s: the looming threat of Y2K software failures and the new phenomenon of the internet. Insurers and agency management system vendors were torn between replacing their aging mainframe and desktop computers to take advantage of this new technological leap forward or patching their old systems for Y2K. They settled for web-based facelifts for their old back-end systems rather than purchasing or developing fully web-enabled solutions. As we crossed the threshold into the new millennium, terrible combined loss and expense ratios, followed by the Great Recession, sapped what little appetite
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insurers and insurance software vendors might have had for innovation. As the current decade unfolded, however, technological innovation blossomed again in the insurance industry. Insurers and agents alike realized that the dominance of smartphones as the primary mode of consumer communication, along with the emergence of cloud computing, required radical adjustment of our technological vision. When this renewed inclination to accept technological change met the influx of
aspect of our lives and businesses, and both have made possible the progress achieved by other businesses. Essentially, any technology can be focused on helping to address either risk mitigation or risk transfer requirements. And innovation follows the money: More than $1 trillion has been invested in insurtech in the last four years, according to Willis Towers Watson. Much of this new technology is part of the Internet of Things, which includes all the devices creating SMART [Self-Monitoring, Analysis and Reporting Technology] homes, vehicles and buildings. These devices not only provide rich new sources of data for underwriting and pricing risks, but they also offer real opportunities for insurers and agencies to leverage enhanced engineering and loss control services to create SMART risk management services. What makes these devices SMART is artificial intelligence and machine learning, which can also remind agents of customers’ preferences and offer advice on cross-selling scenarios and gaps in coverage. A whole new category of global companies has arisen to mediate interactions between
“It’s more accurate to call this the insurtech evolution, since most of the investment and innovation is benefiting incumbents, and they have been quick to seize these opportunities” private equity capital fleeing the overinvested fintech space, their love-child – the insurtech revolution – was born. It’s more accurate to call this the insurtech evolution, since most of the investment and innovation is benefiting incumbents, and they have been quick to seize these opportunities. If insurers and agents lack sufficient motivation in this regard, there are significant disruptors nipping at their heels, and they get more than their fair share of press. It’s not really surprising that so many diverse technology platforms have found a willing audience in the insurance sector. Insurance shares a common characteristic with technology: Both impact nearly every
the insurance world and insurtech startups. Startupbootcamp, the company that operates the Hartford InsurTech Hub accelerator, is one of many such companies. It presently manages 28 accelerators in 19 countries that have supported the growth of 592 startup ventures with funding of more than $375 million. The future of our insurance technology landscape is evolving as we speak. Vive la révolution! Frank Sentner has been creating insurance technology solutions for 42 years. He recently helped the State of Connecticut, City of Hartford, UConn, Travelers and others create Connecticut’s first InsurTech Accelerator.
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PEOPLE
INDUSTRY ICON
RISK TAKER Managing risk in her own career prepared Alison Martin to confront the world’s biggest perils as Zurich’s group chief risk officer
BEFORE SHE took the reins as Zurich’s group chief risk officer in September 2017, Alison Martin’s résumé didn’t contain any risk management roles. Following her law studies, she fell in love with insurance while working in insurance audit and consulting at PwC. From there she moved to Swiss Re, where she explored almost every corner of the business, quickly learning about underwriting, pricing, costing, reserving, RND and claims, before ascending to the role of chief financial officer. So when she took on the role of chief risk officer at Zurich, she was confident that the lessons she’d learned from her previous roles and the risks she’d taken had adequately prepared her for the job. “To me, I have taken risk on the first line all the time,” she says. “What I have done throughout my career is take risk. That means you manage risk – you have to have risk awareness, you have to understand the kinds of risks that exist, what could be your downside as well as your upside, and you need to think about what your mitigating actions are. So now, on the second line, I can use all the knowledge I’ve had of taking risk to help the risk team here at Zurich think about how we can help the first-line team do appropriate risk-taking as efficiently and
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effectively as possible.” Drawn to Zurich by the opportunity to try something new, Martin also passionately believed in the vision that group CEO Mario Greco was setting out for the company. “I really believe in the transformation of the insurance industry and how Mario speaks about that – and, more importantly, the actions he has put in place to have Zurich
customers enjoy having as part of their lives – and the company is taking action to make this happen.
Growing global risks As group chief risk officer, Martin has also been instrumental in the World Economic Forum’s most recent Global Risk Report, which Zurich helped to produce in partner-
“I have taken risk on the first line all the time ... So now, on the second line, I can use all the knowledge I’ve had of taking risk to ... help the first-line team do appropriate risk-taking as efficiently and effectively as possible” very well positioned in that transformation,” she says. She explains that Zurich doesn’t want customers to simply pay a premium and never think about their insurance again. The company wants to move to a model where instead of being an annoying burden, insurance is a value-add service that
ship with Marsh & McLennan. The report’s findings on climate change, cybersecurity and geopolitical tension made headlines around the world as the World Economic Forum called for action from governments and business. “It should be seen as a great wake-up call to government, to companies, to society at
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PROFILE Name: Alison Martin Title: Group chief risk officer Company: Zurich Insurance Group Based in: London Years in the industry: 24 Career highlight: Juggling a career while being the mother of two girls
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PEOPLE
INDUSTRY ICON
large as to what the risks are that we face in society generally, and to business specifically,” Martin says. Not surprisingly, extreme weather events were the most likely risk highlighted by the report. For insurers, many of whom are seeing increases in these events and therefore a surge in claims in the aftermath, the report presents a number of thought-provoking issues – some of which they can tackle by leading by example. Zurich has taken steps in the environmental space, for example, by choosing to not insure coal plants or invest in companies that
to deal with. Cyber is one of those accumulation risks. It’s a constantly evolving and emerging risk, and we see an unfortunate lack of awareness.”
Championing diversity One of Martin’s other passions is raising awareness around diversity, the lack of which continues to haunt the industry. “The insurance industry is probably no poster child for diversity, but Zurich I think is a good poster child,” she says. “We’re not perfect, but if you look at the changes that Mario has made over the last couple of years
“I take the role model part of the position very seriously. I think it’s very important that, if you have that ability to influence others coming through their career, you take that opportunity” derive more than 50% of their revenue from coal. And Martin is very firm on her position on climate change. “Particularly worrying for me is that [the number-two risk] now is the failure of climate change mitigation and adaption – i.e. the failure of policy to do anything about the risk – and extreme weather events is number one,” she says. “As an insurer, those two things are a little worrying.” The other major area insurers must keep an eye on, Martin says, is cyber risk. Although it seems very different than environmental risk at first glance, Martin believes the two are actually very similar in a lot of ways. “What makes cyber and environmental risk similar is the fact neither of them have boundaries, neither of them have borders,” she says. “And that makes them very tricky
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ZURICH’S FINDINGS FROM THE 2019 GLOBAL RISKS REPORT
alone, he has radically shifted the executive committee’s composition, so we have much better gender diversity.” These changes, she says, can help to shift the culture in an organization and send strong signals of support. Martin is also part of Zurich’s women’s innovation network, and she works hard to ensure she helps other women in the firm. “I take the role model part of the position very seriously,” she says. “I think it’s very important that, if you have that ability to influence others coming through their career, you take that opportunity. I think that sends a really strong signal to the whole organization, but more importantly to the industry at large, that you can be successful – and, in fact, you are more likely to be very successful – if you have diversity.”
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of the top 10 global risks are environmental in nature
2
of the top 10 risks are related to cybersecurity
65%
of respondents said they expect further erosion of global policy coordination on climate change in 2019
85%
expect political confrontations between major powers to increase this year
82%
expect theft of data and money via cyber attacks to intensify in 2019 Source: World Economic Forum Global Risks Report 2019
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SPECIAL REPORT
FIVE-STAR WHOLESALE BROKERS AND MGAs
FIVE-STAR
WHOLESALE BROKERS AND MGAs
Which wholesaler brokers and MGAs are going above and beyond to serve clients? Producers had their say, and now IBA reveals the best wholesale partners in the industry THE ABILITY to craft innovative solutions for complex risks is a hallmark of the wholesale, specialty and surplus lines insurance industry. Surplus lines professionals are experts in unique and hard-to-place risks, and they react quickly to market changes to accommodate non-standard needs. A.M. Best’s 2018 report on the sector revealed that the surplus lines industry reached a historic $44.9 billion in direct written premium in 2017, representing a 5.8% increase over the prior year. The 15 states with stamping offices reported $31.4 billion in surplus premium collection in their states in 2018, an 11.3% increase over 2017. Both are good indicators of the industry’s strength and stability heading into 2019. The Wholesale & Specialty Insurance Association [WSIA] was formed in 2017 through the merger of AAMGA and NAPSLO to represent members throughout the surplus lines industry and promote the valuable role they play in the insurance market. WSIA helps members build business relationships by
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providing networking and business meetings, education, talent recruitment and development initiatives, regulatory and legislative advocacy, and promotion of the value of wholesale distribution, all of which are designed to support this healthy and growing market. WSIA monitors and advocates for state and federal regulation and legislation that impacts members and the industry. Current priorities include revisions to the federal definition of private flood insurance in the Flood Insurance Market Parity and Modernization Act, which will preserve the private market’s ability to solve unique and complex flood risks for consumers, as well as implementation of the National Association of Registered Agents and Brokers [NARAB]. WSIA also continues to support uniform implementation of the Non-admitted and Reinsurance Reform Act [NRRA], establishing the insured’s home state as the one and only jurisdiction that can regulate and tax surplus lines transactions. WSIA’s Annual Marketplace and Under
writing Summit are premier networking forums where industry partners can collaborate, and WSIA’s education programs, held throughout the year, provide technical training and professional development to keep members at the forefront of best practices as the industry evolves. As a result, WSIA members are innovators whose knowledge of and access to specialty markets result in customized solutions for retail agents and their clients. As the market grows, the association also continues to emphasize talent development initiatives to encourage university students to consider careers in this sector of the industry through college outreach and the WSIA internship program. Those of us in the industry know that there has never been a cost for seeking a wholesale quote, and we can now demonstrate that there is also no additional expense for the insured in using a wholesale specialist to develop the best solution. A 2016 cost-effectiveness study by Conning found that wholesale brokers offer technical expertise, innovative solutions to
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complex risk, and access to strong and stable insurers with no added cost to the transaction. Leveraging a wholesale partner to find the best and most cost-effective solution is the best way to serve the insured. WSIA members include tens of thousands of individual brokers, insurance company professionals, underwriters, and other insurance specialists and professionals worldwide. We are pleased to support these outstanding professionals and the wholesale, specialty and surplus lines industry as it continues to prosper. Joel Cavaness President WSIA
METHODOLOGY IBA ASKED retail producers to rate the performance and service of their wholesale broker and MGA partners on a scale of 1 (poor) to 10 (excellent) in eight areas:
• Marketing support
• Underwriting responsiveness/ turnaround time
The wholesale brokers and MGAs that earned an average score of 8 or greater in at least one category were awarded a five-star designation, signifying their exceptional service. In total, 27 wholesale partners earned a five-star rating this year. Of those companies, 14 were also designated as All-Star Wholesalers, having earned five-star status in all eight categories.
• Technical expertise and product knowledge • Range of products • Compensation (commission, bonuses, profit-share, etc.) • Claims support
WHAT ARE THE THREE MOST IMPORTANT THINGS PRODUCERS LOOK FOR IN A WHOLESALE BROKER OR MGA?
• Technology/automation • Communication
HOW WELL DID WHOLESALE BROKERS AND MGAs PERFORM? Underwriting responsiveness/turnaround time
Underwriting responsiveness/turnaround time
9.00 93%
Technical expertise and product knowledge 8.84
Pricing 59%
Communication 8.83
Technical expertise and product knowledge 50%
Range of products
Range of products 8.70
Compensation (commission, bonuses, profit-share, etc.) 38%
Reputation
8.64
Claims support 8.58
15%
Claims support
Marketing support 8.40
14%
Marketing support
Technology/automation 8.29
14%
Compensation (commission, bonuses, profit-share, etc.) 12%
Technology/automation 4%
Geographical reach 1%
1 Poor
5 Fair
10 Excellent
WHAT OTHER AREAS ARE IMPORTANT TO PRODUCERS? Producers wrote in a few other qualities they look for in their wholesale partners: Strength of carrier relationships Loss control Accessibility and communication
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SPECIAL REPORT
FIVE-STAR WHOLESALE BROKERS AND MGAs FIVE-STAR MGAs AND WHOLESALE BROKERS BY CATEGORY Wholesaler
Underwriting responsiveness/ turnaround time
Technical expertise Range of Communication and product products knowledge
Compensation
Claims support
Marketing support
Technology/ automation
All Risks Ltd. AmWINS Group Inc. Anderson & Murison Inc. Appalachian Underwriters Braishfield, a division of Hull & Company Brown & Riding BTIS Burns & Wilcox CRC Group Executive Perils Genesee General Gorst & Compass Hull & Company JM Wilson Johnson & Johnson Inc. Monarch E&S Insurance Services Morstan General Agency, a division of Hull & Company NIF Group Inc. Norman-Spencer Agency Inc. Preferred Property Program RIC Insurance General Agency, a division of Worldwide Facilities LLC Risk Placement Services Inc. RT Specialty LLC SIS Insurance Services TAPCO Underwriters Inc. USG Insurance Services Inc. Worldwide Facilities LLC
All-Star Wholesale Partner 28
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OUT-THINK verb
To see beyond what's been done before
AT RT SPECIALT Y, IT’S WHAT WE DO. Our wholesale specialty risk professionals have the expertise and tenacity to craft superior coverages for retail brokers’ toughest risks, regardless of account size. Contact your RT Broker at rtspecialty.com
AGRIBUSINESS
A V I AT I O N
C A S U A LT Y
PROFESSIONAL & EXECUTIVE LIABILITY
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CONSTRUCTION
PROPERTY
ENERGY
R E A L E S TAT E
E N V I R O N M E N TA L
T R A N S P O R TAT I O N
H E A LT H C A R E
LIFE SCIENCE
W O R K E R S ’ C O M P E N S AT I O N R T B I N D I N G www.ibamag.com 29
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SPECIAL REPORT
FIVE-STAR WHOLESALE BROKERS AND MGAs
ALL-STAR WHOLESALE PARTNER
AMWINS GROUP Headquarters: Charlotte, NC
A global specialty insurance distributor, AmWINS Group is focused on developing specialty products and services to support retail clients and carrier partners. As the largest global MGA/MGU and program administrator platform, AmWINS underwrites more than $1.7 billion in premium annually, offering more than 60 niche P&C programs for various specialty product lines and industry classes. “At AmWINS, we are proud to offer our retail clients not only specialized
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Scott Purviance, CEO (left) and Bob Petrilli, president, underwriting division (right)
knowledge and expertise, but also superior tools, services and AmWINS exclusive products, like AmWINS Special Risk Underwriters [SRU],” says CEO Scott Purviance. “We utilize our numerous practices to develop new programs and products that provide retail brokers with innovative solutions and unparalleled market access. As the industry’s leading wholesaler, our scope and size enables us to focus considerable resources on areas of particular importance to retail brokers. Beyond our commitment to specialization, we invest heavily in technology and offer extensive resources – including claims
advocacy, actuarial services and modeling capabilities – with the goal of helping our retail clients conduct their business more effectively and profitably.” In 2018, AmWINS launched two new MGAs: AmWINS Specialty Logistics Underwriters [ASLU] and Sentinel Marine Underwriters [SMU], in addition to acquiring Seacoast Brokers and The Flood Insurance Agency [TFIA]. “AmWINS is continuously looking for opportunities to acquire and/or build underwriting platforms to provide useful products to our retail clients and profitable business for our carrier partners,” Purviance says.
www.ibamag.com
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SPECIAL REPORT
FIVE-STAR WHOLESALE BROKERS AND MGAs
ALL-STAR WHOLESALE PARTNER
ANDERSON & MURISON Headquarters: Los Angeles, CA
For more than 50 years, Anderson & Murison [A&M] has helped independent agents and brokers deliver solutions for
clients’ unique, hard-to-place and specialty insurance needs. With retail partners in all 50 states and access to admitted and non-admitted carriers, including Lloyd’s of London, A&M specializes in personal umbrella coverage, but also offers a full line of commercial and personal lines products
for virtually all types of risks. A&M also provides many online tools, including raters, EZ applications and self-service options, and is building on those efforts to better serve partners. “We are continuing to develop additional online options for our retailers to make it easier for them to quote and bind policies,” explains executive vice president Mitch Jawitz. “Our current website allows our retail agents to quote, and in some cases bind, many personal and commercial risks. We will continue to improve these options in 2019.” A&M is also working with carriers to offer new products that reflect the current marketplace. It recently rolled out new markets for amusement centers, cannabis products and building renovations.
Preferred Property Program can help you procure Umbrella coverage for your insureds with an AXV A.M. Best rated carrier for the following types of risks: Developer Sponsored Boards Master Associations High-rise Associations & Apartments to 35 stories are eligible and more Limit options ranging from $5 million to $50 million Coverage can include excess D&O ● General Liability ● Auto ● Employee Benefits Employers Liability, Including Employment Practices Liability* (*if covered under the D&O) Follow Form EPLI is available only up to $25 Million limit In 2016 we partnered with American Union Risk Underwriters (AURA) located in Florida. With our new partner we can now also offer our comprehensive Umbrella, with unsurpassed service and for the following types of risks: Hotels ● Motels ● Timeshares ● Lessor’s Risk ● Enclosed Malls ● Shopping Centers Retail ● Office Buildings ● Warehouses ● Light Industrial ● Apartments Limit options ranging from $5 million to $100 million For information on our AURA program, contact our experienced underwriter Tom Clementi at 877-506-1430 or visit our website, www.aurains.com
A subsidiary of
101 Crawfords Corner Road, Suite 1300 Holmdel, NJ 07733
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For more information contact our team of Underwriters
888-548-2465
www.ppp-quotes.com
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UNDERWRITING RESPONSIVENESS AND TURNAROUND TIME FIVE-STAR WHOLESALE BROKERS AND MGAs All Risks Ltd. AmWINS Group Anderson & Murison Brown & Riding BTIS Burns & Wilcox CRC Group Executive Perils Genesee General Gorst & Compass JM Wilson Johnson & Johnson Monarch E&S Insurance Services Morstan General Agency, a division of Hull & Company NIF Group Norman-Spencer Agency Preferred Property Program RIC Insurance General Agency, a division of Worldwide Facilities RT Specialty SIS Insurance Services TAPCO Underwriters Worldwide Facilities Wholesale partner performance
9.00 According to producers, underwriting responsiveness and turnaround times have become wholesalers’ best-performing area, even though overall performance has remained stagnant since 2018, when the average score was also 9 out of 10. Nonetheless, individual companies did very well in this area – 22 wholesalers earned a five-star rating in the category. Generally, producers were appreciative of their wholesalers’ prompt response to quote requests; some even noted that the service they received was so superior, it would be difficult to improve. “The team is great and really responsive, and they also send you a tracking system that lets you know they received [the quote],” one producer raved about their MGA. Despite mostly glowing reviews, a few producers were unhappy with their wholesalers’ underwriting services. “Acknowledge a request when received rather than waiting a week with no response,” one producer said. Others noted issues with staff turnaround and underwriter incompetence.
TECHNICAL EXPERTISE AND PRODUCT KNOWLEDGE FIVE-STAR WHOLESALE BROKERS AND MGAs
All Risks Ltd. AmWINS Group Anderson & Murison Brown & Riding Burns & Wilcox CRC Group Executive Perils Genesee General Gorst & Compass JM Wilson Johnson & Johnson Monarch E&S Insurance Services NIF Group Norman-Spencer Agency Preferred Property Program RT Specialty SIS Insurance Services TAPCO Underwriters USG Insurance Services Worldwide Facilities
Wholesale partner performance
8.84 It’s obvious that retailers seek specialization and expertise from wholesale partners, but just how well are wholesalers meeting producer expectations in this area? As was the case last year, technical expertise and product knowledge was wholesalers’ second best-performing area. The average score was 8.84 out of 10, and 20 wholesalers earned a five-star rating. Producers value a partner who can provide comprehensive coverage guidance and consultative information, and for the most part, wholesale partners are delivering. “I truly believe you will not find brokers more knowledgeable in their areas of expertise,” one producer said of their wholesale partner, while another described their wholesaler as “very helpful with [product knowledge] and giving us scenarios and definitions to help with our clients.” Some producers felt their wholesalers could do more to demonstrate their expertise, particularly by making the underwriting experience more consistent. “Most underwriters are great, some not so much,” one producer said. This was echoed by another producer who felt the expertise and knowledge at their wholesale partner varied between underwriting units. Another producer complained that their wholesaler tends to rely on the producer too much for product knowledge, which suggests a clear gap in expertise.
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SPECIAL REPORT
FIVE-STAR WHOLESALE BROKERS AND MGAs COMMUNICATION FIVE-STAR WHOLESALE BROKERS AND MGAs All Risks Ltd. AmWINS Group Anderson & Murison Appalachian Underwriters Braishfield, a division of Hull & Company Brown & Riding BTIS Burns & Wilcox CRC Group Executive Perils Genesee General Gorst & Compass JM Wilson Johnson & Johnson Monarch E&S Insurance Services Morstan General Agency, a division of Hull & Company NIF Group Norman-Spencer Agency Preferred Property Program RT Specialty SIS Insurance Services TAPCO Underwriters Worldwide Facilities
Wholesale partner performance
8.83 For the first time this year, IBA asked producers to evaluate their communication with wholesale partners. For the most part, producers were pleased with the level of communication they received. Twentythree out of 27 companies earned a five-star rating, with an average score of 8.83. For producers, being able to contact their wholesaler through any channel makes a difference. Many prefer to communicate with a wholesale partner via email or text; however, most said a phone call is always best when urgency is required. Regardless of whether requests are time-sensitive or not, producers always appreciate answers in a timely fashion. “They are very quick to get back to us. Many times we have needed things in a rush, and they send us what we need,” one producer said about their wholesale partner. Another praised their partner as “a breath of fresh air in an otherwise stagnant market of brokers ... They are quick to call, email, respond, offer suggestions, and review coverage enhancements and programs.” While many rated communication with their wholesaler as “adequate” or “better than most,” some had a few suggestions on how the line of communication between producers and wholesalers can be improved. “Better communication between the underwriter, assistants and broker,” a producer suggested, adding that “sometimes not all parties know what’s going on.” Another requested that their wholesaler “keep us informed and call us back with status on quotes,” while another noted that their MGA is “so big, sometimes I am not sure who to go to.” Ultimately, the level of communication falls on individual underwriters and staff, but building a company-wide culture focused on timely communication can set the standard when servicing retail partners.
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ALL-STAR WHOLESALE PARTNER
WORLDWIDE FACILITIES Headquarters: Los Angeles, CA
A national wholesale insurance broker, MGA and program underwriter, Worldwide Facilities was founded in 1970 and provides retailers access to virtually every specialty domestic and international insurance market.
Top, left to right: Davis Moore, Ron Austin, Eric Stuckman, Hank Haldeman Bottom, left to right: Emily Flores, Gil Hine, Gary Kitchen, Amicia Hine
In addition to offering property, casualty, professional and personal lines products, Worldwide Facilities offers exclusive programs such as ocean cargo, upstream energy, towing, local and intermediate trucking, intermodal, and NutraRisk, an exclusive program for the dietary supplement/ nutraceutical industry. Last year was one of tremendous
growth for Worldwide Facilities. In 2018, the firm completed five acquisitions and remains focused on bringing additional products, technology and employee talent to the MGA space in 2019. “Worldwide Facilities focuses on building strong customer relationships while leading with product expertise, breadth of markets and speed,� says CEO Davis Moore.
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SPECIAL REPORT
FIVE-STAR WHOLESALE BROKERS AND MGAs RANGE OF PRODUCTS
COMPENSATION
FIVE-STAR WHOLESALE BROKERS AND MGAs
FIVE-STAR WHOLESALE BROKERS AND MGAs
All Risks Ltd. AmWINS Group Anderson & Murison Brown & Riding BTIS Burns & Wilcox CRC Group Executive Perils Genesee General Gorst & Compass JM Wilson Johnson & Johnson Monarch E&S Insurance Services Morstan General Agency, a division of Hull & Company NIF Group Norman-Spencer Agency Preferred Property Program RIC Insurance General Agency, a division of Worldwide Facilities RT Specialty USG Insurance Services Worldwide Facilities
All Risks Ltd. AmWINS Group Anderson & Murison Appalachian Underwriters Brown & Riding BTIS Burns & Wilcox CRC Group Executive Perils Genesee General Gorst & Compass Hull & Company Johnson & Johnson Monarch E&S Insurance Services Morstan General Agency, a division of Hull & Company NIF Group Norman-Spencer Agency Preferred Property Program RIC Insurance General Agency, a division of Worldwide Facilities Risk Placement Services RT Specialty SIS Insurance Services USG Insurance Services Worldwide Facilities
Wholesale partner performance
8.70
Wholesale partner performance While access to primary markets is what producers care about most, many are still looking for broader and more niche markets. Most wholesale brokers and MGAs are keeping pace with producer expectations in this area, earning an average score of 8.70 out of 10. In addition, 21 wholesale brokers and MGAs received a five-star rating in this category. Overwhelmingly, producers pointed to workers’ compensation as the one critical coverage they’re missing from their wholesalers, but mobile home and commercial auto coverage also made their wish lists. A few producers praised their wholesalers for access to a variety of markets but criticized the lack of complete coverage within those markets. Other producers had nothing but positive feedback for their wholesalers. “Given the niche markets our agency targets, the range of product availability has been a great fit for our needs,” said one, while another commented, “[We’ve] never heard ‘we can’t do that.’” But more isn’t always better. One producer noted that by working with a wholesale partner with a concentration on fewer markets, they’re also getting a deeper level of expertise. “Focus is narrow, but this is a good thing,” the producer said.
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8.64 Compensation made a leap from seventh to fifth place this year in terms of performance with a score of 8.64 – and 24 wholesalers earned a five-star rating, the most of any category. The bad news is that this area remains one of producers’ lowest priorities when considering a wholesale partner. Most producers rated their compensation as fair, with few variances from company to company – which might be why it isn’t a quality they prioritize. “Compensation is in line with most brokers, and while it’s important, it’s not the most important [thing],” a producer said. That said, 10 more wholesalers earned a five-star rating this year than in 2018. Although producers recognize that their pay is fair, they weren’t shy in suggesting that more is always welcome, especially for those who bring in big business: “It would be nice to see high compensation for dedicated agents with a higher volume,” one producer said. But money doesn’t always talk: Another producer said they’d be willing to accept lower compensation from an MGA that provided better expertise and service.
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SPECIAL REPORT
FIVE-STAR WHOLESALE BROKERS AND MGAs Paul Hohlbein, president (left) and Jeff Hohlbein, co-president and general counsel (right)
FIVE-STAR WHOLESALE PARTNER
BTIS Headquarters: Rocklin, CA
In 1998, Norbert Hohlbein established Builders & Tradesmen’s Insurance Services [z zva a] with the help of his sons Paul and Hank, daughter Lisa and son-in-law Jeff. Built around a small artisan contractor general liability program, BTIS eventually expanded to offer contractors’ license bonds, builder’s risk, inland marine, commercial auto, BOP, excess and workers’ compensation. Now, with an average 17%
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year-over-year growth rate, BTIS still offers every producer the same small business rapport and customer service. Technology has been a focus for BTIS since the 1990s, and the company’s drive to continue breaking rules and pushing boundaries has not wavered. BTIS’ online price indication system, comparative rater and email correspondence create a fast and simple environment for producers to quote and bind commercial accounts. “BTIS utilizes a platform that allows its retail agents to access our products online,”
Paul Hohlbein explains. “They can quote and bind via the platform. We also utilize our inside sales team to call and assist our retail agents in placing the business. We also utilize webinars to train on our platform and our products.” This year, BTIS is developing a new agent-facing interface, as well as integrating a new market finder to make it easier for agents to place business with the company. BTIS also plans to add new BOP, commercial auto and workers’ comp markets in 2019.
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SPECIAL REPORT
FIVE-STAR WHOLESALE BROKERS AND MGAs CLAIMS SUPPORT FIVE-STAR WHOLESALE BROKERS AND MGAs
8.58
All Risks Ltd. AmWINS Group Anderson & Murison Appalachian Underwriters Braishfield, a division of Hull & Company Brown & Riding Burns & Wilcox CRC Group Genesee General Gorst & Compass JM Wilson Monarch E&S Insurance Services Morstan General Agency, a division of Hull & Company NIF Group Norman-Spencer Agency Preferred Property Program RIC Insurance General Agency, a division of Worldwide Facilities RT Specialty Worldwide Facilities MGA ad 2.875.pdf
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Most producers gave their wholesale brokers and MGAs mediocre scores – not bad, but also not great. “Keep us informed as status/reserves change” and “better communication with the insured” were a few of their suggestions. One producer also asked that the claims status be available online so retail brokers can easily check up on a claim’s standing. Some producers were satisfied with their wholesalers’ involvement in the claims process: “They assist as needed, seeking to help us service the insured,” said one respondent. “After a poor claims experience, our broker was proactive in changing their procedures for future claims,” reported another. Overall, respondents recognize that claims are largely in the hands of the insurer, but they still appreciate when wholesalers are able to provide updates or assist in finding solutions to any issues.
4:44 PM
Proud to be a Five Star MGA
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A lot rides on how efficiently and effectively an insurance claim is handled, which is why producers appreciate when their wholesale partners can step in and ease the process. In order to capture the most accurate picture of claims support, IBA asked producers to rate their wholesaler in this area only if they’ve experienced a claim. Consistent with 2018, claims support was wholesalers’ sixth best-performing area, with an average score of 8.58.
“After a poor claims experience, our broker was proactive in changing their procedures”
Executive Perils
Wholesale partner performance
We Say YES!
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(800) 234-6977 40
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ALL-STAR WHOLESALE PARTNER
BROWN & RIDING Headquarters: Los Angeles, CA
Founded in 1980, Brown & Riding is built around the core values of teamwork, quality and professionalism. Since its inception, the company has developed 16 well-established specialty practice areas, including construction, environmental, healthcare, technology, workers’ compensation and more. In addition, Brown & Riding has access to more than 350 markets and strives to help retailers find the best options for their insured clients. Brown & Riding is also the first wholesale insurance broker in the US to
Chris Brown, chairman (right) and Jeff Rodriguez, president and CEO (left)
achieve ISO 9001 certification, a nationally recognized certification requiring a comprehensive quality management system that is externally audited annually to ensure B&R follows procedures and maintains efficiency and accuracy. This makes it easy for retailers to partner and do business with B&R. “We continue to evolve and anticipate our clients’ needs by becoming even more hyper- and micro-specialized,” says president and CEO Jeff Rodriguez. “A growing number of risks simply cannot be properly managed or insured by generalist brokers or ‘cookie cutter’ solutions.” “Rather than being organized by territory, we are organized by expertise and
bring retail producers the best collective efforts, knowledge and relationships of the entire firm, not just one individual broker,” adds chairman Chris Brown. “We operate as an extension of the retail producer’s own team, offering expert, trustworthy advice and service for a wide variety of business.” This year, B&R will continue to expand its offerings by further building out its specialty groups. “We also plan to continue the strategic long-term growth of our national footprint,” Rodriguez says. “We have consistently achieved double-digit organic annual growth for more than a decade and are paced to continue.”
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SPECIAL REPORT
FIVE-STAR WHOLESALE BROKERS AND MGAs FIVE-STAR WHOLESALE PARTNER
RISK PLACEMENT SERVICES Headquarters: Rolling Meadows, IL
Through a nationwide network of product and industry experts, Risk Placement Services helps support retail producers’ growth by responding to unique coverage
needs. Serving more than 26,000 independent agents across the US, RPS’ binding authority offices act as an outsourced under writing branch for a range of specialty carriers, offering local expertise with a national reach, while RPS National Brokerage helps place accounts that retail agents cannot with standard markets, focusing on specialized or hard-to-place insurance. In addition, RPS’ e-commerce platform allows agents to quote, bind and issue products online within minutes. Currently, the team is innovating new products to bring to market, including professional liability for artisan contractors, real estate appraisers, registered investment
advisors and allied healthcare facilities. In addition, the RPS programs team is building on its position as one of the largest MGAs by launching new exclusive programs for retail clients, including adding product and practice experts in key geographic locations to build on solutions for construction, transportation, healthcare, cyber/technology, property, environment, casualty and personal lines insurance needs. RPS’ mission is to anticipate and react, quickly and professionally, to the needs of retail agents and continue to build business partnerships with insurance markets that transcend traditional market cycle. From large, complex risks to small businesses and startups, RPS aims to be the go-to wholesale and specialty broker partner.
It’s a True Honor
to be chosen as a Five-Star Wholesale Broker and MGA! We’re proud to be recognized as one of your best.
Thank you!
Risk Placement Services, Inc. Knowledge. Relationships. Trust and Confidence.
Visit us at RPSins.com 42
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MARKETING SUPPORT FIVE-STAR WHOLESALE BROKERS AND MGAs
All Risks Ltd. AmWINS Group Anderson & Murison Appalachian Underwriters Brown & Riding Burns & Wilcox CRC Group Executive Perils Genesee General Gorst & Compass JM Wilson Monarch E&S Insurance Services Morstan General Agency, a division of Hull & Company NIF Group Norman-Spencer Agency Preferred Property Program RIC Insurance General Agency, a division of Worldwide Facilities SIS Insurance Services Worldwide Facilities
Wholesale partner performance
8.40 Marketing support from wholesalers is one of producers’ least caredabout categories, so it’s not surprising that wholesalers are lagging behind in providing competitive marketing options. Just 19 wholesale brokers and MGAs earned a five-star rating for their marketing support – the fewest of all categories. While some producers find marketing support to be helpful to their business, others don’t see the value and prefer to keep marketing efforts in-house. For the producers who want support, only few found their wholesalers’ efforts to be sufficient. “[They have] a great marketing team; they do an excellent job promoting on social media,” said one producer. “They are terrific at marketing and very transparent about what underwriters are saying about each risk,” said another. Most producers, however, criticized the lack of communication from their wholesaler’s marketing representative. Other suggestions for improvement include fliers or ads that can be customized with agent information, incentives to help with advertising costs, marketing collateral explaining specializations and programs, and more face-toface time with marketing reps. One producer also suggested that wholesalers could sponsor a digital marketing co-operative to help retailers better promote programs.
ALL-STAR WHOLESALE PARTNER
NORMAN-SPENCER AGENCY Headquarters: Dayton, OH
Norman-Spencer has made a name for itself within the wholesale market based on its people and the relationships they’ve developed with business partners in the
industries it serves. With a wholesale team composed of 10 individuals and a goal to surpass $75 million in written premium this year, Norman-Spencer is constantly developing new carrier relationships and exclusive products to better serve clients. Over the years, the company has established direct relationships with a number of both admitted and non-admitted insurance companies, while its wholesale team provides access to exclusive programs such as contractors’ auto and contractors’ equipment. With a concentration on construction business, Norman-Spencer has in-house experts who focus on niche classes of business, including concrete pumpers and concrete ready-mix, both of which the company has served for more than 25 years. In addition to construction, the team has producers who focus on transportation business, including specialty haulers, towing and collateral recovery.
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SPECIAL REPORT
FIVE-STAR WHOLESALE BROKERS AND MGAs
ALL-STAR WHOLESALE PARTNER
PREFERRED PROPERTY PROGRAM Headquarters: Holmdel, NJ
Currently celebrating 100 years in the business, Preferred Property Program
[PPP] and American Union Risk Associates are both subsidiaries of JGS Insurance, located in Holmdel, New Jersey. Representing a number of companies, including AXA XL, Chubb, AmTrust Financial and CNA Insurance, PPP offers umbrella
policies with limits ranging from $1 million to $100 million and also offers additional programs such as workers’ comp, environmental impairment, equipment breakdown coverage and package policies for real estate owners. “We are extremely honored and thankful to be nominated by our retail brokers and to be recognized as a Five-Star MGA for the second consecutive year,” says PPP president Ken Hager. “We continue to strive to improve our online processes to save our brokers time and improve the timely output of policies and endorsements,” adds executive vice president Carmen Suarez. “We have a top-quality team who work diligently to make sure our brokers’ needs are met in a timely and efficient manner.”
We have your back!
A nationally acclaimed provider of property & casualty insurance that focuses on construction, real estate and select specialty lines.
Norman-Spencer has the relationships you need to get your insureds the best coverage. Our team is ready to help you!
Quality Coverage
Competitive Pricing
Quick Turnaround
Call 800.753.3557 or visit norman-spencer.com
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FIVE-STAR WHOLESALE PARTNER
RT SPECIALTY Headquarters: Chicago, IL
RT Specialty is the wholesale brokerage arm of Ryan Specialty Group, an international holding company with wholesale brokerage, MGU underwriting companies and other specialty services. Founded in 2010, RT Specialty is an independent wholesaler with no insurance company backing or venture capital funding, and is not affiliated with any other insurance broker, financial
institution or company. Headquartered in Chicago, RT Specialty has 40-plus offices and more than 1,400 team members nationwide in all of the major markets. With more than $6 billion in premium placements in 2018, RT Specialty is ranked as one of the leading wholesale insurance brokers in the US. RT Specialty handles accounts of all sizes and specializes in brokering property, casualty, real estate/ habitational, transportation, workers’ compensation, life sciences, professional and executive liability risks, and personal
Timothy W. Turner, chairman and CEO
lines, among many other classes. In addition, RT has a concentration in tough, high-hazard risks that demand detailed expertise and specific industry experience. RT Specialty brokers place significant premium volume into the insurance marketplace across all lines of business, which translates into significant market clout. With their technical expertise, exceptional underwriting relationships and fine-tuned execution skills, RT brokers deliver consistent, exceptional, cuttingedge risk solutions.
www.ibamag.com
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SPECIAL REPORT
FIVE-STAR WHOLESALE BROKERS AND MGAs
ALL-STAR WHOLESALE PARTNER
BURNS & WILCOX Headquarters: Farmington Hills, MI
For the past 50 years, Burns & Wilcox has valued the strong relationships it has built with retail brokers and agents, working in cohesive partnership to help them achieve business success. Offering a wide range of solutions to more than 30,000 independent brokers and agents worldwide, Burns & Wilcox is recognized as a go-to expert for under standing sophisticated and complex risks
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and providing a broad range of specialty insurance solutions quickly to help meet clients’ needs. When servicing retail partners, the company strives to provide unparalleled underwriting expertise, brokerage capabilities, risk mitigation counsel, sales and marketing support, and continuing education opportunities to help partners achieve their goals in all facets of the industry. Furthermore, Burns & Wilcox is always proactively exploring and implementing opportunities that deepen
its expertise, expand its capabilities and elevate client satisfaction. Building on the implementation of its personal insurance practice groups in 2018, Burns & Wilcox continues to add expertise across its offices in the US and Canada. By deepening its practice groups for all lines of business, Burns & Wilcox is expanding that framework into further specializations, while also exploring additional ways to engage producers through brokerfacing portals.
www.ibamag.com
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TECHNOLOGY/AUTOMATION FIVE-STAR WHOLESALE BROKERS AND MGAs All Risks Ltd. AmWINS Group Anderson & Murison Appalachian Underwriters Brown & Riding BTIS Burns & Wilcox CRC Group Executive Perils Genesee General Gorst & Compass JM Wilson Johnson & Johnson Monarch E&S Insurance Services Morstan General Agency, a division of Hull & Company NIF Group Norman-Spencer Agency Preferred Property Program RIC Insurance General Agency, a division of Worldwide Facilities Risk Placement Services SIS Insurance Services Worldwide Facilities Wholesale partner performance
8.29 Technology and automation remains wholesalers’ weakest area of performance, earning an average score of 8.29 out of 10 – but it also ranks at the bottom of producers’ concerns when seeking a wholesale partner. Still, 22 wholesalers managed to earn five-star ratings in this category. Many producers were indifferent about their wholesale partners’ technology. “Have not dealt with [technology] much; not certain this is as important as other critical components in the relationship,” said one respondent. This might be because all wholesale brokers and MGAs offer some level of technology – it’s just a matter of how much technology each producer wants access to. For producers who aren’t as satisfied, the common ground was a desire for their wholesale partners to adopt more sophisticated systems. “Embrace technology more for submissions and servicing business,” suggested one producer, while another wished for “better technology
HOW CAN WHOLESALE PARTNERS IMPROVE?
“Keep us informed of changes in programs” “Add more specialty units and improve the knowledge of underwriters” “Provide a library of sample forms that agents can access in case they have questions” “I would like a list of products offered and contact information for those departments” “It would be nice if more things were available online, [such as] copies of documents or billing questions” “More help with coverage structure” “Hold webinars for their products” “Provide the ability for the retail agent to generate their own quotes”
to help follow up on submissions or policy/endorsement copies.” A third complained that “quoting is easy but takes too much manpower, time and effort to bind. Use technology to simplify the document process.” Another producer shared the same sentiment, asking their MGA to speed up the paperwork process with a system that is 100% digital, including adding DocuSign and cloud-based software. However, one producer pointed out that wholesalers’ shortcomings with technology might be a result of industry limitations: “There are improvements that every MGA can make, but they are limited due to technology limitations that are industry-wide,” the producer said. “If we could receive IVANS downloads from our MGA for our surplus lines book, that would be amazing, but I don’t think that’s possible.”
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SPECIAL REPORT
FIVE-STAR WHOLESALE BROKERS AND MGAs
ALL-STAR WHOLESALE PARTNER
NIF Headquarters: Manhasset, NY
Exclusively serving independent agents since 1976, NIF [North Island Facilities] is a specialty insurance facility with established expertise in program management, wholesale brokerage and binding authority/MGA services. NIF’s solid foundation was built by developing
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Mark P. Maher, president and chief operating officer
long-term relationships with independent agents and their carrier partners. Based in New York with offices nationwide, NIF underwrites programs for nonprofits, social service agencies, bowling centers and trade contractors, in addition to offering access to specialty property & casualty such as contractors, difficult products, environmental, property and management/professional liability. The
firm’s goal is to provide creative solutions for retail insurance clients by leveraging its experience, expertise and strong relationships with partner carriers. NIF brings value to clients by helping them grow their businesses with access to exceptional products, programs and speed to wholesale markets. Since December 2016, NIF has been a premier portfolio company of JenCap Holdings.
www.ibamag.com
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A FRESH PERSPECTIVE
360° THINKING
When you need innovative solutions to complex risks, you need a partner who sees clearly.
Find out more at aspen-insurance.com
Accident and Health | Credit and Political Risk | Crisis Management | Cyber | Energy and Construction Environmental | Excess Casualty | Marine | Primary Casualty | Professional Lines | Property | Railroad Liability | Surety
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FEATURES
SECTOR FOCUS: SPECIAL EVENTS
The main event Special events insurance is needed by a variety of companies and individuals, and recent high-profile tragedies have reshaped the essential components of this coverage
who rely heavily on a core of staff working for no payment,” Mead says. “The most common type of claims at any special event are related to trips, slips and falls for guests and staff, and if a volunteer is injured while performing their duty on behalf of the festival organizer, the accidental medical policy can kick in and pay some of the initial medical bills.” Directors & officers liability is an equally important consideration, Mead explains. “Although the festival or event takes place for one week out of the year, the organizer has a board in place 365 days a year doing the business to set up and arrange the next festival, so D&O is often required.”
The active assailant threat
THE SPECIAL events insurance market is a vast segment. Special events policies are tailored for a diverse range of activities and attractions, ultimately providing coverage for any type of event where a group of people come together. Some of the more common special events include trade shows and business conventions, civic celebrations, concerts, festivals, holiday celebrations, dedications, key person visits, sporting events, political rallies, grand openings, and business anniversaries and parties. “It’s an interesting category because everything is so different and you never know what will come your way,” says Warren Mead, senior underwriter in the events and attractions division at K&K Insurance Group. In recent years, K&K has covered everything from a city’s 150th anniversary to a papal visit, the dedication of the new USS Indiana battleship and the retirement party for the navy’s fighter jet, which was a particularly big event. “For decades, the F-14 Tomcat was the navy’s primary fighter aircraft, so when they retired it and replaced it with the F/A-18 Hornet, the navy decided to have a weekend-long celebration,” Mead says. “We provided the coverage for all the related activities that went on over at the Oceana naval air station that weekend.”
Common add-ons In most cases, the promoter or organizer of the event is considered the named insured
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and is responsible for purchasing the coverage and ensuring it’s adequate. Because the organizer is responsible for managing the event and signing contracts for all related activities, they are naturally the focal point for how the event approaches risk. In addition to the broad third-party bodily injury and property damage protection provided by the general liability aspect of the policy, there are many add-ons that an event promoter or venue might require. These
The market for special events insurance is rather limited, and traditionally not many insurers have shown an interest in the exposure. The changing nature of risks related to special events in recent years has further constricted the market. “The climate of what can happen at a large public gathering has changed,” Mead says. “Event organizers used to have fears around trips and falls, but now they have to think about the threat of an active shooter or someone using a vehicle as a weapon. These new risks are very difficult to address
“There are now several stand-alone [active assailant] coverages available in the market, and competition has driven pricing to affordable levels. As such, businesses ranging from multinationals to SMEs are now buying protection” Peter Bransden, Aspen Insurance extras can include liquor liability, property liability, event cancellation, commercial auto, sexual abuse/molestation, crime insurance and contingent coverage for exposures like fireworks and amusement rides. “Volunteer accident is also an important feature for most nonprofit event organizers,
and foresee, and they have led to the market becoming even more constricted.” The grim reality is that the increased occurrence of shootings at public events and festivals has led to a heightened need for active assailant coverage. Even though the active assailant marketplace existed prior
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WHY ACTIVE ASSAILANT COVERAGE IS CRITICAL 35
ACTIVE SHOOTER INCIDENTS PER YEAR IN THE UNITED STATES 30
30 26
25
20
20
20
17
14
15 11
10 6
5 0
21
19
20
4
9
10
10
8
4
1
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Source: FBI.gov
to the mass shootings in Las Vegas and Parkland, Florida, both events influenced the speed at which the market has grown. The scale of these two attacks, and their profound effects, led to an increase in demand for
significant limits on coverages. According to Peter Bransden, vice president of crisis management at Aspen Insurance, “2018 was a year of tremendous growth for active assailant insurance, with
more underwriters and brokers focusing their efforts on the product. There are now several stand-alone coverages available in the market, and competition has driven pricing to affordable levels. As such, businesses ranging from multinationals to SMEs are now buying protection.” At a basic level, an active assailant policy protects victims and organizations from the effects of an active shooter incident, which can generally be defined as a deliberate malicious attack carried out by someone armed with a firearm, vehicle, explosives and/or any instrument or substance used as a weapon. Most solid policies offer crisis response consultancy, and some insurers provide round-the-clock access to experienced consultants who will guide the policyholder through the aftermath of an attack. “Additionally, these consultants will
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FEATURES
SECTOR FOCUS: SPECIAL EVENTS SPECIAL EVENT EXPOSURES TO CONSIDER Volunteers at events Number of guests/attendees High-value equipment/items Use of fireworks Use of motor vehicles Food and liquor safety Extreme weather Sexual abuse
provide pre-incident training to help prevent the occurrence or mitigate the effects of these events – often such training is funded entirely by the insurer,” Bransden says. “The other main coverages offered in the market are extra expenses – including medical and psychiatric treatment, funeral costs, temporary security and brand rehabilitation, among others – physical damage, business income loss, legal liability and defense costs.” The active assailant market originally included policies that were a combination of coverages taken from property, terrorism and workplace violence forms. Now, leading markets have written original policies specifically for this emerging threat. “One example is the demolition and rebuild coverage now available to companies concerned that, following an attack, they may have to demolish and rebuild premises, even if physical damage to the structures themselves was not material,” Bransden says. “This coverage was created in response to several school shootings in recent years, where classrooms were demolished following attacks, and represents a new approach to thinking about indemnity.” Insurers are constantly updating their policies to reflect the changing nature of these threats and their potential consequences. For example, loss of attraction coverage is now being offered in the market.
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“The climate of what can happen at a large public gathering has changed. Event organizers used to have fears around trips and falls, but now they have to think about the threat of an active shooter or someone using a vehicle as a weapon” Warren Mead, K&K Insurance Group “Companies are concerned that they may suffer a significant drop in revenue following an attack, even after they are able to recommence operations,” Bransden explains. “This protection is new to the market, but now forms part of some stand-alone active assailant policies.” It might seem like a tragic market in which to be involved, but agents familiar with the active assailant space are filling an important coverage gap for many clients. Traditional P&C coverages rarely include the protection that an active assailant policy provides. While many general liability poli-
cies treat active assailants as a gray area and won’t react in any material capacity until a lawsuit is received, the crisis response consultancy coverage within an active assailant policy provides 24-hour access to expert resources. “Given the sad increase in active assailant events over recent years, it is likely that the market for this coverage will continue to grow in size,” Bransden says. “I believe the active assailant marketplace could soon overtake that of terrorism, maybe even relegating the latter to being an excess-only placement in the future.”
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FEATURES
BROKERAGE INSIGHT
Flying high Jon Downey, president of AssuredPartners Aerospace, discusses how aviation insurance is currently evolving and what the future of this unique niche might look like
IBA: How is technology affecting aviation insurance? Jon Downey: It’s a fascinating time, as previously there has not been a tremendous amount of focus on technology within the aviation insurance segment. The challenge has been that at many of the large insurance companies, the aviation niche is so small relative to their total writings that it’s the last department to get attention, and they just haven’t put the investment into technology. Today, however, as aviation specialists, we’ve made great strides with online quoting platforms for those parts of the business that are somewhat commoditized, such as the high-volume, low-premium policies we see in owner-flown aircraft. In this regard, we’ve developed Elevon, a subsidiary company based in Atlanta that created a clean-sheet policy administration system that is an outstanding technology solution for underwriters. We currently have one underwriting company participating in it, and we anticipate others will soon join in. What this does within the space of high-volume, low-premium business is allow us to aggregate multiple carriers, so a broker has a single point of contact where they put their information in once and get quotes back from several companies.
IBA: What are the major factors affecting aviation today? JD: There is a growing shortage of pilots and mechanics. To fly an aircraft, you have to be a
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licensed pilot, and to work on one, you have to be a licensed airframe and powerplant mechanic … I recently attended a National Air Transportation Association town hall meeting, and the number-one topic was attracting new talent, as retirements of pilots and mechanics are on the rise, while new students in both fields are not keeping pace. Compounding this problem is the fact that we don’t have the military pipeline for pilots and mechanics we once did, as there are fewer veterans with aviation experience entering civilian life. To address this problem, virtually every segment of the aviation industry – from the airlines to business aviation – is stepping up efforts to attract and retain qualified talent.
IBA: Is there an area of insurance where you feel clients are underinformed? JD: Cyber threats. From an insurance perspective, we break down the industry into two segments: general aviation and major risk airline business. General aviation is basically everything with the exception of aircraft
manufacturer risks and airlines. Across the board in general aviation, commercial operations are fairly underinformed about emerging cyber risks. At the airline level, you see professional risk managers who understand that exposure and how to address it. However, it’s a new concept for most general aviation operations, and as such, protection against cyber threats isn’t yet a consideration for many customers in this space.
IBA: What are the areas in aviation insurance where clients tend to be underinsured? JD: There’s been an increase in the cost to repair aircraft, and the hangar keepers’ liability limits clients are carrying haven’t kept pace with the exposure. We have also found certain situations where the coverage hasn’t been actively marketed and limits are no longer adequate. It depends on the area of risk – we’ve seen single passenger settlements go as high as $100 million, and clients may need to reconsider their current limits.
THE BIRTH OF ASSUREDPARTNERS AEROSPACE Since its founding in 2011, AssuredPartners has acquired and invested in insurance brokerage businesses across the United States and in London, and has grown to more than $1 billion in annualized revenue and 170-plus offices. AssuredPartners Aerospace was formed through the acquisition of several successful aviation insurance agencies, including Airpower Insurance, AirSouth Insurance and Weber Aviation Insurance Services in December 2018, along with Hardy Aviation Insurance in February 2019.
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JON DOWNEY’S CAREER TIMELINE 1987 Graduates from Embry-Riddle Aeronautical University with a bachelor of science in aviation maintenance management 1988 Joins United States Aviation Underwriters and serves in various roles for nearly two decades 2006 Moves to Allianz Aviation Managers as a senior vice president
“Underwriters are seeing fewer and fewer risks, but in those risks, the exposure has gone up – yet they are capping what they’re willing to cover. We’re hoping to change this” Agricultural aircraft used for aerial application of chemicals on crops is another example. These aircraft are valued at well over $1 million … and have underwriters thinking about them more. But the limits they are willing to put out for third-party property damage is capped at $1 million, and the chemical application coverage is capped at $500,000. This just isn’t sufficient for many aerial application operators today. In fact, I’m familiar with an aerial application operator who, during this past growing season, hit a cell tower in Arkansas; the tower itself was $1 million, which was the most he could get for coverage. This is just one example of the problem, and it’s one that needs to be addressed.
In that regard, we do see the conversation changing for insurers, clients and brokers. At AssuredPartners Aerospace, we’re helping modify the landscape itself by consolidating around this small niche. Underwriters are seeing fewer and fewer risks, but in those risks, the exposure has gone up – yet they are capping what they’re willing to cover. We’re hoping to change this in order to better serve our clients.
IBA: What makes aviation insurance unique from a professional standpoint? JD: Aviation is a segment of the industry that is built on passion. We pride ourselves on being a part of the aviation community, and I think that’s very unique in the insurance business.
2010 Is appointed head of aviation in the US for Allianz Global Corporate & Specialty 2016 Becomes senior underwriter of general aviation in the US for Swiss Re Corporate Solutions 2018 Joins AssuredPartners as president of AssuredPartners Aerospace In fact, I would say the majority of people involved in aviation insurance as producers or underwriters are pilots, mechanics or both. These people have a real passion for aviation, and they enjoy staying in front of the unique exposures and the risks associated with the industry. At AssuredPartners Aerospace, we always point out that we were aviators well before we were insurance professionals – and we still are. I believe that level of passion gives us a deeper understanding of our clients, which in turn allows us to serve them better.
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SPECIAL PROMOTIONAL FEATURE
WHOLESALE BROKERS AND MGAs
Five-star growth Specialty distribution platform JenCap has been on the acquisition trail recently and continues to grow into one of the largest wholesale platforms in the US
FROM DAY one, JenCap Holdings has sought to build a national specialty distribution platform focused on providing bestin-class service with innovative solutions for independent retail brokers and agents. To accomplish this, the firm knew it would need to acquire regional firms with stellar reputations and relationships.
through carefully targeted acquisitions of regional wholesalers with strong leadership teams. Keeping those leadership teams intact is critical to JenCap’s continued growth. “The leaders of these companies fostered strong bonds and grew alongside their retail partners over the years,” Jennings says. “Losing such important relationships
“The intermediary insurance space is a people-first business … If a targeted firm’s management team had no intention of continuing with the firm, they were immediately taken off our M&A list” John Jennings, JenCap Holdings “I have always thought that there is real goodwill attached to the brand name of a quality regional wholesaler, and we continue to leverage those brand names after an acquisition,” says JenCap CEO John Jennings. JenCap saw an opportunity to build a one-of-a-kind national distribution platform
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watered down the acquisitions for a lot of our competitors. The intermediary insurance space is a people-first business … If a targeted firm’s management team had no intention of continuing with the firm, they were immediately taken off our M&A list. “ Jennings adds that JenCap’s acquisitions
have allowed the firm to add management talent and developed staff with “deep understanding of the regions in which they reside. They all understand the landscapes and nuances as to what is important for their clients. Two of our acquisitions, North Island Facilities and Genesee General, have been recognized as Five-Star Wholesale Brokers by Insurance Business America, something we are very proud of and use in our marketing material.” The leaders of those organizations, Mark Maher and Roger Ware, have become integral members of the JenCap executive management team. The best-in-class business qualities they have instilled in their respective firms’ corporate culture is reflected in their repeat five-star designations. “It all starts with building trust through transparency with our retail clients and carriers,” says Ware, president of Georgiabased Genesee General. “If you’re open and honest with your business associates, you earn their trust over time. As a managing general agent, honesty plays a vital role in building your reputation with your agents and your carriers that you underwrite for. It’s imperative that we represent the risk fairly and accurately with both honesty and integrity.” Maher, president of New York-based North Island Facilities [NIF], has a similar outlook on building strong relationships with the agents and carriers his firm represents. “Our industry is built on close personal relationships that are based on trust, which is earned over time,” Maher says. “Once that trust is earned, we then have the ability to deliver innovative solutions for the most challenging and complex risks. For over 40 years, retail agents have been relying on our firms’ solutions for some of their most challenging accounts. You don’t continually get those opportunities year after year by taking shortcuts on any side of the deal.” NIF and Genesee General aren’t the only firms to be added to JenCap’s national
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distribution platform. Wholesale Trading Insurance Services [WTIS], Trivedi Capacity, M.J. Kelly, Special Risks Facilities and Risk Innovations round out JenCap’s current stable of companies. “Each of the companies within the JenCap platform brings leadership, talent and their own individual cultures that are helping us shape JenCap’s corporate identity,” Jennings says. Workers’ compensation specialist Risk
Innovations is the latest company to be added to the JenCap brand; JenCap now has more than 425 employees in 23 offices in 20 states. The company is on track to break the billion-dollar premium mark by 2020, which will place it among the largest property & casualty wholesalers in the US based on total written premium. “The goal for JenCap has never been to be the biggest wholesaler; rather, we set out to build the highest-quality national whole-
sale platform by expanding our distribution network, product offerings and geographical footprint through organic growth and a disciplined yet aggressive acquisition strategy,” Jennings says. “JenCap has an incredibly unique opportunity, given our current size and structure, to really do something different in the wholesale distribution space. In all my years in the industry, I have never been more excited for the road ahead.”
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FEATURES
FEEDBACK
How to give feedback effectively Are your employees too sensitive to negative feedback, or have you just been delivering it poorly? Aytekin Tank outlines five ways to ensure feedback is well received
PAUL GREEN and his colleagues at Harvard Business School believe negative feedback – on its own – rarely leads to improvement. Instead, it spurs us to remove ourselves from the partner or group where we’ve received the feedback and ‘shop’ for confirmation among new social circles. At work, that means we will seek out a new arrangement for our next project. If stuck with a certain partner or in a specific department, we might feel the urge to form relationships with people in other departments – anything to confirm the positive view of our actions and values within the company. When we can’t maintain that positive confirmation, it isn’t pretty. Physical consequences like anxiety and depression can threaten to pull us deeper into a spiral of poor behavior and, in turn, negative feedback. This need to protect our psyche is how and why we end up creating – and subconsciously locking ourselves into – our own echo chambers. Yes, feedback is a necessary evil – and there aren’t many things I’d say that about.
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Feedback is a multi-faceted concept that’s vital to the way many of us work and live. So I thought I’d dig into just why feedback is such a hard pill to swallow and a few ways I’ve learned to deliver it effectively over the years.
Setting the stage for feedback delivery Delivering feedback, especially negative, is far more complex than telling an employee what they need to fix and expecting them to scamper off and focus on those items in a vacuum devoid of their own emotions. The tactical tricks that I’ll get into here won’t prove effective without setting the stage with an affirmative work environment in which opportunities for positive confirmation and supportive relationships flourish. Think of your relationship with your partner or a longtime friend. A single discomfiting remark from one of them certainly wouldn’t send you running for the hills, would it? Negative feedback can lead to improvement when given in a confirming environment
where the receiver feels supported and valued. When it comes to the workplace, there are many systems in place that erode the sense of value employees feel they offer the organization. Competition for promotions, commission-based salaries and poorly executed peer reviews can certainly degrade any positive confirmation and lead to feedback falling on deaf ears. Once you’re able to create an environment in which your workers feel valued and confirmed in their positive attributes, you can try these five methods I’ve used to deliver feedback they can actually act on.
1. Encourage continued conversation with subjective feedback It’s tough to give feedback that people don’t want to run screaming from. And it can be even more challenging when it comes to giving feedback for creative work. On JotForm, our users use our online form builder to collect feedback, and a big part of
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Unless your comments can be tied directly to organizational goals, they really are just personal judgments, which have a way of putting their receiver into a defensive and combative mood – and rightly so that feedback involves creative input. One thing I’ve noticed is that, much like creativity itself, feedback about creativity is highly subjective. If you’re able to frame it as such, you’re much more likely to start a discussion about where the design or feature
can go next instead of shaming and shutting down its creator. For example, I might say, “Personally, I gravitate towards this bigger, brighter button than towards the main action you want me to take on the page” instead of a definitive, objec-
tive statement like “This design is wrong.” It’s not about control. It’s not even about being right. It’s about providing constructive feedback in a way that encourages the creative process to continue.
2. Speak in patterns rather than specifics Duration neglect dictates that we’re more likely to remember peak moments (good or bad) and the most recent moments in any event. It is this, along with tons of other fascinating and confusing tricks the brain plays with memory, that makes it all too easy to provide biased feedback. And people who sense unfairness aren’t
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FEATURES
FEEDBACK
likely to take positive action. Instead of relying on one particular recent example, it’s important to collect data from different sources over time to find patterns in behavior. I personally like to use a simple evaluation form template to collect anonymous feedback on how my team feels a certain design or feature came out. By combining this information with my own observations of specific examples, I’m able to provide unbiased feedback on areas where a certain design is excelling, as well as areas where it could improve. The knowledge that I’ve taken the time to identify real patterns goes a long way in negative feedback being received as supportive rather than a threat to the employee’s wellbeing and job security.
feedback will reinforce their positive values. It will take more than a sandwich to create a workplace in which feedback isn’t perceived as a threat and employees don’t feel the need to shop for confirmation. But this method is effective for times when you haven’t had a chance to establish good rapport with the receiver or have to deliver quick feedback.
4. Tie feedback directly to organizational goals We often hear the phrase “it’s nothing personal” when it comes to giving and receiving feedback. However, unless your comments can be tied directly to organizational goals, they really are just personal judgments, which have a way of putting their receiver into a defensive
The knowledge that I’ve taken the time to identify real patterns goes a long way toward negative feedback being received as supportive rather than a threat to the employee’s well-being and job security 3. Whip up a delicious feedback sandwich A quick way to help create an environment that confirms an employee’s value before delivering negative feedback is to deliver it stacked like a sandwich – otherwise known as the PIP (praiseimprove-praise) method. The process is as easy, and tasty, as it sounds: First, deliver praise that confirms the positive values a person has about themselves and their place in the organization. Sandwich feedback that could be taken as negative in the middle. Top it off by reiterating the earlier praise or by explaining how acting on this
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and combative mood – and rightly so. In order to deliver effective feedback that helps an employee better align with organizational goals, you’ve got to make sure those goals are clear to begin with. It wouldn’t be fair for me to deliver negative feedback solely because I don’t personally align with someone’s management style. In the same vein, it also wouldn’t be fair to critique an employee for not hitting certain organizational goals if they’ve never been told what those are. That’s why I strive to make sure my leadership team, as well as every single employee, is on the same page when it comes to organizational goals. And when it comes time for
me personally to deliver feedback, I always make sure to first revisit our organizational goals right there in the meeting to make sure my comments are aligned and actionable — not emotional.
5. Encourage the employee to walk a mile in your shoes Feedback can be especially frustrating to hear when you don’t understand what’s motivating it. So it can really help an employee by inviting them to walk a mile in your shoes, as the saying goes. Right there in the feedback session, encourage them to role-play as if they were in your management position. After describing the situation, you can tell your employee that you find it challenging to address the issue, and ask how she would handle the matter if she were managing the group. By stepping away from the threatening feelings for a second and viewing things from your perspective, your colleague can better understand that negative feedback is not meant as a personal attack, but as a way to help them better serve their team and grow their own development. This tactic can also help managers see how their team members personally process feedback and provide great insight into the management strategies they respond well to. Employees who understand management’s motivation are more likely to view negative feedback as a tool for growing their professional development rather than a threat. Aytekin Tank is founder and CEO of JotForm, an online form creation software with four million users worldwide and more than 100 employees. A developer by trade but writer by heart, Tank shares stories about how he exponentially grew his company without any outside funding. For more information, visit jotform.com.
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A M E R I C A
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Will your company be able to make the cut? Help us uncover the best places to work by participating in our upcoming Top Insurance Workplaces. Know how well you are doing in terms of diversity, compensation, benefits, training and more. Nominate online at https://www.insurancebusinessmag.com/us or email Heather Turner at heather.turner@keymedia.com
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PEOPLE
CAREER PATH
RULES OF ENGAGEMENT Mike Levins has spent his career building trust and cultivating connections
Nearing the end of his degree in finance and marketing, Levins got a fateful call for an interview with Great American Insurance. “It came of the blue. Insurance was an industry I hadn’t considered, so I took the interview as practice, but I learned that this industry marries my interests in marketing and finance. I was excited that I didn’t have to choose.”
1992
DISCOVERS INSURANCE
1999 EMBRACES A NEW CHALLENGE Engaged in rebuilding, St. Paul Insurance Company approached Levins with an offer to be their new underwriting manager – a role that fell outside his comfort zone. “It was a completely different world. They asked agents and brokers for recommendations, and my name came up. It was an intense time – I handled everything related to management liability accounts and then was asked to run the financial services book as well.”
2006 LEARNS NEW LINES When he moved to CNA Insurance, Levins saw it as an opportunity to become familiar with a new area of the business. “I was the specialty lines liaison to the commercial side and ran the private D&O book for the Midwest. I worked for the president of the region and reported up through the commercial lines; it was an opportunity to learn all of those lines.”
2013 MOVES TO HISCOX Ready for a change, Levins received an off-the-cuff recommendation that led him to Hiscox, where he’s now head of US broker relations. “I happened to mention to a broker friend that I was looking for a new challenge, and he looked at me and said, ‘You’re joining Hiscox – they’re looking for someone, and it would be right up your alley.’ He was having dinner with Hiscox leadership that night, and I had an interview the following week.”
1997
TAKES OVER A TERRITORY In his roles as an assistant, representative and ultimately marketing supervisor, Levins dedicated himself to learning the ropes, researching the products and understanding the brokers. “I traveled all over the Midwest meeting brokers, enlightening them on products and engaging with them, building those relationships. That was the genesis. I had to earn their trust so that if they had an issue, they would call me.”
2001 SETS UP LIBERTY A former manager tapped Levins to help Liberty International open an office in Chicago.
“We took over dilapidated office space and then decided what to underwrite and created the brand in the Midwest. When we opened the doors at Liberty, no one knew who we were and no one was sending us business. It was like a startup – we had to generate a business flow” 2012 GETS PROMOTED After he was promoted to vice president of sales, Levins’ talent for training came into its own. “I was charged with improving the sales acumen for approximately 1,000 underwriters and underwriting managers in the US. It was exciting to be in a more strategic position. We had a ‘sales university’ to train our people, guide them and offer coaching.”
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PEOPLE
OTHER LIFE
TELL US ABOUT YOUR OTHER LIFE Email iba@keymedia.com
Tomas says da ncing, which he “learned on the streets”, allowed him to find his individuality. “Then I fou nd out there was a whole commu nity of da ncers out there.”
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Styles of dance Tomas practices (breakdance, house and salsa)
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Number of dancers in Neutroniks, Tomas’ dance crew
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Years it took Tomas to learn to spin on his head
BUST A MOVE Broker Emmanuel Tomas has never forgotten his first love: dance AT THE age of 13, Emmanuel Tomas was walking through the park when he noticed a group of breakdancers practicing their moves. “I was mesmerized by what they were doing,” says the Los Angeles-based insurance broker. “I asked how I could learn, and they taught me a few basic moves.
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Every weekend I would go back to the park and learn more. That’s where the love of dance began for me.” Now Tomas, who also goes by the name Rocko, dances with Neutroniks, his own crew of about a dozen dancers. “They are virtually my brothers,” he says. “Our 15-year anniversary is this year.”
Together, the crew has traveled all over California to dance events and competitions, although performances are rarer these days as the crew members focus on their careers. But Tomas still has the moves. “I love the creativity and the fact that I can express myself through dance,” he says.
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