IBAMAG.COM ISSUE 11.01 | $12.95
2023
PROGRAM ADMINISTRATORS AND CARRIERS
UNDERWRITING FIRST
Strategy for risk retention and trusted partnerships
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EYEING THE TRENDS
Construction’s environmental and professional liabilities
NICHE MARKETS THRIVE Underwriting expert delivers specialized program solutions
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UPFRONT
EDITORIAL
www.ibamag.com MAY 2017 EDITORIAL
Managing Editor Paul Lucas North America Editor Jen Frost Journalists Gia Snape, Mia Wallace, Danny Wood, Terry Gangcuangco, David Saric, Desmond Devoy News Writers Roxanne Libatique, Kenneth Araullo, Mika Pangilinan Staff Writers Pete Miller, Ryan Smith, Bennett Richardson, Mallory Hendry, Ksenia Stepanova Copy Editors Christina Jelinek, Karen Atienza
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CORPORATE Chief Executive Officer Mike Shipley Chief Operating Officer George Walmsley President Tim Duce Chief Information Officer Colin Chan Director - People and Culture Julia Bookallil
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Time to hold your head high
“I
nsurance is boring, isn’t it?” That’s what so many of us in the industry hear as we, almost shamefully, whisper what we do for a living at parties. It’s an image problem that the sector has battled for decades – after all, we’re all just boring white men in suits, allegedly. It’s an issue with serious repercussions too – countless articles in Insurance Business over the past year have focused on insurance’s talent gap and the struggle to attract the next generation. “It’s a fight,” Ed J. Majkowsi, EY Americas insurance sector and advisory leader, previously told Insurance Business. “The generation coming out of school these days are all excited about working for some of the largest technology firms in the world. When they have to choose between working for a technology firm, a bank, or an insurer, insurance almost always comes last.” An honest assessment undoubtedly – but one that doesn’t reflect insurance’s reality. Just look at this past year for examples.
When they choose between working for a technology firm, a bank, or an insurer, insurance almost always comes last Want to work in finance? Insurance continues to feel the repercussions of a hard market amid the inflationary effects on back-year claims. If you want to guide clients on protecting themselves through a cost-of-living crisis, insurance is for you. Want to work in tech? Insurance is looking to scale the use of artificial intelligence – it can “replace work that is done, or make it more accurate, or work alongside underwriters,” according to Chubb CEO Evan Greenberg. Want to be on the frontline? In 2022–23 alone, brokers and loss adjustors have helped pick up the pieces after hurricanes Ian and Fiona; wildfires in California, Nova Scotia, Alberta, and Idaho; among other North American catastrophes. Want to “do good” for society? Giving back is at the core of many insurers’ businesses – whether that’s through community sponsorships or major corporate campaigns. Want a diverse workplace? Insurance has cast aside its stale, male, and pale image with forward-thinking events like the Dive In Festival and the Women in Insurance series. For whatever question you’re asked, insurance has an answer. So next time someone asks you what you do, hold that head a little higher. Insurance isn’t boring – and it’s time to tell the world why. The team at Insurance Business America
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ISSUE 11.01
CONNECT WITH US
CONTENTS
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Got a story or suggestion, or just want to find out some more information? twitter.com/InsuranceBizUS facebook.com/InsuranceBusinessUS
UPFRONT 01 Editorial
Insurance is a boring profession? Think again.
FEATURES FEATURES
UNDERWRITINGFIRST MODEL AM Specialty fosters deep strategic partnerships with stakeholders
26 SPECIAL REPORT
44 Purpose
Purpose in work is a self-discovery journey that everyone can take
PROFILES 22 Amwins
Leveraging data and analytics to provide tailored programs and unmatched support
24 Gallagher Agency Alliance
“Moments of magic” for small business owners benefitting from the Gallagher Way
5-STAR PROGRAM ADMINISTRATORS AND CARRIERS 2023
Survey results reveal this year’s exceptional performers in America’s insurance industry PEOPLE
INDUSTRY ICON
FEATURES
EVOLVING RISKS Westfield Specialty closely watches environmental and professional construction risks
30 RPS Signature Programs
Leading program administrator brings “expertise and passion to every niche”
Rusty Reid, CEO of Higginbotham, on how the insurance brokerage goes above and beyond delivering policies
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FEATURES
BETTER TOGETHER
5-Star Networks and Alliances celebrated for indispensable support to agent community
IBAMAG.COM CHECK IT OUT ONLINE
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When it comes to protecting your contractor clients
Let EMC do the heavy lifting. EMC has the knowledge and expertise to protect every square inch of your clients’ needs. And with over 110 years of experience, we’ve become the jack of all trades — from general contractors to electricians to excavators. No matter your client’s specialty, EMC has the right tools to protect them — and you won’t even break a sweat.
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SPECIAL REPORT
2023
PROGRAM ADMINISTRATORS AND CARRIERS
The 2023 IBA 5-Star Program Administrators and Carriers are delivering excellence through collaboration
CONTENTS
PAGE
Feature article............................................................
6
Methodology .............................................................
7
Winners ...................................................................... 12
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SPECIAL REPORT
5-STAR PROGRAM ADMINISTRATORS AND CARRIERS 2023
GREAT PROGRAM PARTNERSHIPS COLLABORATION IS a key pillar of the insurance industry. The 2023 IBA 5-Star Program Administrators and Carriers awards celebrate that ethos through the mutually beneficial relationships among some of the best program administrators and carriers across the US. Brokers, carriers, and program admin-
istrators were all surveyed to determine the standout performers. In the end, 20 program administrators and 11 carriers were recognized for their impressive performance and given 5-Star status.
All-around operator RPS Signature Programs, the program
PROGRAM CARRIERS’ RANKING ON VARIOUS CRITERIA 1 = not important; 5 = most important
Program exclusivity Marketing support
6
2021 3.99 2.96
Internal program manager expertise
4.07
Claims specialization
3.64
2022
2023
4.86 3.53
4.47 3
4.42 4.15
4.16 4.28
Financial stability
4.22
5
4.91
Carrier reputation
4.28
4.95
4.81
Relationship management
4.12
4.7
Underwriting guidelines
4.09
4.36
4.47
Compensation
4.02
4.39
4.16
Commitment to innovation
3.81
4.21
4.28
4.75
“We maintain a strong commitment to investing in cutting-edge digital technologies and enhancing our underwriting, marketing, and distribution capabilities” Russell Duffey, RPS Signature Programs
administrator division of Risk Placement Services (RPS), attributes part of its success to the variety it offers. “The advantage of working with a larger program administrator, such as RPS, which manages multiple programs and works with multiple carriers, is not just the niche
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expertise; a larger organization such as ours can bring a lot of options,” says Mark Williams, executive vice president of business development for Atlas General Insurance Services, an RPS Company. The 5-Star administrator: • •
maintains $950 million in premiums placed annually sustains more than 80 carrier relationships
It also has 41 individual programs, including: •
•
•
RPS Atlas General Insurance Services Workers’ Compensation, which has a broad underwriting appetite, flexible payment plans, and exceptional claims and loss control services Public Entity All-Lines Aggregate Package, which is a comprehensive solution for municipalities, schools, states, and other public entities and public service community organizations Construction Access Program,
•
Specialty Lines, which focuses on private golf and country clubs, semi-private and daily fee courses, private tennis clubs, golf management companies, homeowners’ associations in gated, year-round communities, clubs, and golf associations on the national, regional, and state levels Quality Comp, which is workers’ compensation self-insured group for not-for-profit social services organizations in California
For these, RPS Signature Programs partners with carrier winner Munich Re Specialty Insurance, which RPS ranked excellent in financial stability, carrier reputation, and program exclusivity. RPS has additionally honed the performance of its programs by creating a product and business development department. It identifies mutually beneficial opportunities for RPS Signature Programs among carriers, clients, and insured individuals and has, to date, transacted over $400 million.
“We thrive in this environment by offering tailored solutions to niche markets” Marisa Tranghese, One80 Intermediaries
•
which is a leading nationwide specialty risk underwriting manager focusing on the crane, rental equipment and party goods dealers, and scaffolding insurance markets Golf and Country Clubs Package/
This is achieved by three core strategies: 1. market research: both primary and secondary research to gain insights into the dynamic market conditions, needs, and trends
METHODOLOGY In May, Insurance Business America issued a call for nominations for the third annual 5-Star Program Administrators and Carriers list. Nominees were ranked based on their achievements and initiatives across a range of areas, including the largest programs, expertise and stability, and innovations in program development. Program administrators were also asked to provide feedback on the carriers they work with, which IBA used to determine the 5-Star Program Carriers. Carriers were evaluated on a scale of 1 (poor) to 5 (excellent) in 10 categories. Those that received an average score of 4.00 or higher were named 5-Star Award winners.
2. product strategy: working closely with subject matter experts to develop comprehensive go-to-market strategies and program submissions 3. product implementation: the project management team oversees the organization of RPS resources and ensures the successful delivery of new solutions to the market However, the firm is still driving forward and looking for gains. “We maintain a strong commitment to investing in cutting-edge digital technologies and enhancing our underwriting, marketing, and distribution capabilities. We have made significant investments in developing a blueprint and roadmap for our future technology state,” says Russell Duffey, president of RPS Signature Programs.
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SPECIAL REPORT
5-STAR PROGRAM ADMINISTRATORS AND CARRIERS 2023
PROGRAM ADMINISTRATORS’ TOTAL PREMIUM VOLUME
Average
2021
2022
$152 million $182 million Highest $76 million
process leading up to underwriting review, while the remaining 60% was categorized into a green, yellow, and red light system.” Despite its success and 5-Star status, the firm isn’t resting on its laurels. Duffey says, “RPS actively identifies and evaluates opportunities to automate small to middle-market commercial businesses through our online e-commerce platform. We have determined plans to continue expanding the number of small and midsized enterprise programs, further accelerating our progress in this area.”
Innovative newcomer
$923 million Lowest $7 million
• •
$14 million
And he explains how this works in practice: •
•
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assessment: “We thoroughly assessed our current technology, processes, and organizational structure to align them with existing and future business needs, address technology risks and pain points, and adopt industry best practices.” technology blueprint: “We created a comprehensive blueprint outlining our vision for the future state of technology within our organization.”
Program administrator 5-Star winner One80 Intermediaries focuses on wholesale brokerage, national programs, contract binding, affinity, administrative services, and specialty insurance. The company, which was formed in 2021,
•
execution plan: “We formulated a detailed plan to effectively implement the envisioned technological advancements.”
The results are clear and demonstrate why RPS is lauded by its industry peers. “Over a five-year period, the Atlas program office managed to significantly reduce the cycle time required to provide a quote or decline a decision within the purchasing window by almost two-thirds,” says Duffey. “We automated 40% of the
•
•
projects $500 million in 2023 revenue maintains 105 carrier relationships in the US, Canada, Europe, and Asia, approaching $1.1 billion in premiums in program business alone generates 22% of revenue from program business, with 9% year-overyear growth maintains 28 cover holder agreements with Lloyds, contributing to more than $82 million in premiums
“The insurance industry is experiencing significant growth, driven by emerging risks and increased demand for specialized coverage,” says Marisa Tranghese, director of programs. “We thrive in this environment by offering tailored solutions to niche
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SPECIAL REPORT
5-STAR PROGRAM ADMINISTRATORS AND CARRIERS 2023
“Sutton values the partnership with [Cannasure], a leader in the cannabis segment that has a deep understanding of the space, provides a quality product to their consumer base, and continues to operate at a profit for all counterparties” Russell J. Renvyle, Sutton National Group
markets. With increased market acceptance and partnerships, we are able to negotiate favorable terms.” For its largest programs – marine, transportation, medical stop loss, cannabis, workers’ compensation, and affinity – One80 Intermediaries collaborates with 130 carriers. One80 ranked them all excellent across the 10 performance criteria. Tranghese says, “One80 seeks many qualities in a carrier partner to ensure a successful and mutually beneficial relationship.” The main touchpoints are: • • •
•
10
Despite being a young company, One80 is prolific and successful in program development innovation. Its notable developments include:
financial stability: strong balance sheets and claim-paying ability innovative product portfolio: to provide comprehensive solutions efficient, responsive underwriting processes: key to smooth operations solid reputation: for customer service and ethical practice
•
•
•
launching a charter vessel liability program with insurtech platform vQuip that provides liability coverage for individual boat renters in all 50 states. Prior to being launched, an individual renter or charterer of a boat had no means of securing liability protection for themselves as an operator of the vessel. acquiring C&M, led by Eric Cheng, and cornering a gap in the market where only 5% of employees in insurance were Asian Americans. C&M revenue has grown by 8% over the prior year, with an EBITDA margin of 61%. developing a Noah flood program to keep American families safe with accessible and affordable flood coverage.
One80 is also using technology to boost efficiency on its operating platform, One80 Fusion. It has built a bespoke operating system in partnership with Slalom, the company’s management consulting team. Lenika Milne, chief marketing officer, says, “The software serves as an agency management system and accounting platform, allowing internal and external users to quote, bind, and issue policies and service accounts from their desk. Importantly, artificial intelligence has been core to this innovative product, and social media platforms have been built into the functionality.” And she adds, “The result is a robust operating platform that codifies One80 processes and ensures consistency in our underwriting guidelines and customer service.” For its cannabis MGA program, Cannasure, One80 lauded carrier winner Sutton National Group with excellent rankings. “Sutton Specialty has partnered with Cannasure since 2021 in support of their presence and market expansion into California and New York,” says Russell J. Renvyle, chief underwriting officer of Sutton National Group. “Since May of 2023, the relationship has expanded to support the entire national footprint of the Cannasure Package Program. “Sutton values the partnership with a leader in the cannabis segment that has a deep understanding of the space, provides a quality product to their consumer base, and continues to operate at a profit for all counterparties.” Tranghese says, “Working with carriers who maintain solid reputations for customer service and ethical practices is of the upmost importance for One80.”
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When It Comes to Partnership,
WE STAND OUT
Relationships are fundamental to our process at Safety National. Insurance is not a transactional business for us. We develop true alliances with our clients fostered by active listening and a deep commitment to finding solutions.
PROCEED WITH SAFETY® Workers’ Compensation | Commercial Liability | Public Entity Liability Commercial Auto | Cyber | Loss Portfolio Transfer
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SPECIAL REPORT
5-STAR PROGRAM ADMINISTRATORS AND CARRIERS 2023
2023
PROGRAM ADMINISTRATORS AND CARRIERS
PROGRAM ADMINISTRATORS One80 Intermediaries Phone: 786 865 4614 Email: lmilne@one80intermediaries.com Website: one80intermediaries.com
MiniCo Insurance Phone: 800 528 1056 Email: info@minico.com Website: MiniCo.com
RPS Signature Programs Phone: 866 595 8413 Email: contactRPS@rpsins.com Website: rpsins.com/signatureprograms
NSM Insurance Group Phone: 800 970 9778 Email: info@nsminc.com Website: nsminc.com
Amynta Dealer Solutions Phone: 913 904 3081 Email: edward.mcnally@amyntagroup.com Website: amyntadealersolutions.com
REInsurePro Phone: 816 398 4080 Email: info@REInsurePro.com Website: REInsurePro.com
Gridiron Insurance Underwriters Phone: 954 331 3000 Email: info@gridironins.com Website: gridironins.com
Ryan Specialty National Programs Phone: 312 784 6001 Email: programs@ryansg.com Website: RyanPrograms.com
Hirschfeld & Associates Phone: 718 522 6555 Email: info@hirschfeldandassociates.com Website: hirschfeldandassociates.com
Norman-Spencer Preferred Property Program PUA
Amwins Underwriting
Specialty Comp Insurance Solutions
Axon Underwriting
Synergy Professional Associates
Cannasure
US Assure
Great Lakes General Agency
WH Brownyard
PROGRAM CARRIERS
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Arch Insurance
Hanover
Phone: +1 201 743 4000 Website: insurance.archgroup.com
Markel
Allianz
Munich Re Specialty Insurance
AmTrust
Nationwide
AXA XL
Sutton National
CNA
Zurich
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PEOPLE
INDUSTRY ICON
THE SECRET TO LONGEVITY AND SUCCESS Higginbotham’s CEO Rusty Reid celebrates the independent insurance brokerage’s focus on culture and community for 75 years
IN 1948, Paul C. Higginbotham opened a personal insurance brokerage with a modest ambition to serve his small community in Fort Worth, Texas. Fast forward 75 years, and his namesake business – Higginbotham – has grown to a powerhouse brokerage with offices from coast to coast. To celebrate its milestone year, Higginbotham is putting the spotlight back on the keys to its success: culture and community. “Our 75th is geared around celebrating with our employees and giving back to the communities that have been so generous to us across our footprint, which today spans 15 states and 87 offices,” says Higginbotham chairman & CEO Rusty Reid (pictured). Today, Higginbotham is one of the largest independent insurance brokerages in the US, as well as the largest in Texas by revenue. It was nominated to Insurance Business America’s Top Insurance Employers list in 2022.
The “Day Two” difference Once a family-owned enterprise, the organization is now proudly owned by its more
14
than 2,400 employees, a majority of whom are direct shareholders. The employee ownership model aims to reward and incentivize Higginbotham’s workforce, according to Reid. “We began an employee ownership journey back in 1989, and it’s still very much who we are today,” says Reid. “We built this organization for the benefit of our shareholders, which coincidentally happened to be our employees.
established a financial services division to offer employee benefits. But, according to the CEO, what truly sets Higginbotham apart in today’s market is its “Day Two” services, which are geared at supporting clients through risk management, claims, benefit plan services, and administration. “The idea is that on day one, our job is to get a client the absolute best coverage, cost, and cash flow options,” Reid says.
“We began an employee ownership journey back in 1989, and it’s still very much who we are today” “It’s allowed us to not only retain wonderful people but also attract incredible talent to serve our clients.” Reid joined Higginbotham in 1986 from American General Fire and Casualty Company and has since been steering the brokerage through decades of change and growth. Under his helm, the brokerage
“Then we leverage risk management, compliance, communications, contract review, technology … all the things above and beyond delivering a policy. We have found that this solution has improved our customer retention rate and significantly enhanced our ability to land customers.” For Reid, succeeding as a brokerage is
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PROFILE Name: Name: Rusty Rusty Reid Reid Name: Rusty Reid Company: Higginbotham Company: Higginbotham Position: Chairman CEO Position: Position: Chairman Chairman &&& CEO CEO Years in the industry: 40 Years in the industry: Years in the industry: 40 40 Companies worked for: Companies worked worked for: for: Companies Higginbotham; Higginbotham; American American General General Higginbotham; American General Fire & Casualty; Fire && Casualty; Casualty; Ramey, Ramey, King King &&& Fire Ramey, King Minnis Minnis Insurance Insurance Minnis Insurance
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PEOPLE
INDUSTRY ICON
about not just being part of the landscape but also coming up with new ideas and shaping it. “We’ve been very innovative – we like to say that we are producing executives at Higginbotham,” Reid says. “We don’t just listen to the voice of the field – we’re a part of the field.”
Celebrating 75 years of growth In 2007, Higginbotham launched an aggressive merger and acquisition strategy, branching out in Texas and eventually across the United States. Last year, the company continued that expansion as it entered new states and broadened its footprint in others. According to Reid, growth won’t slow
retaining and finding new clients by bringing them value. “We’ve always been great at organic growth as an organization. But leveraging our ‘Day Two’ platform has really been significant for us,” Reid continues.
Giving back to community Amid tremendous success in the insurance industry, Higginbotham remains grounded in its communities through its Higginbotham Community Fund. “I always say that when growth stops, decay begins, and we’ve been very blessed as an organization that our growth hasn’t stopped since 1989,” says Reid. “The by-product of that success is being able to give back to our communities.”
“We don’t just listen to the voice of the field – we’re a part of the field” down any time soon, and it will continue to be powered by Higginbotham’s values. “We launched what we called our ‘Best in Texas’ strategy to be aligned with our mission and vision, which is to be the best place for employees to work, the best client advocate, the best carrier partner, and the best community partner, and we’ve stayed true to that,” Reid tells Insurance Business. “We’re not out just to buy revenue for the sake of buying revenue – we really look to find great partners. Ninety-eight percent of our partners are much larger today than when they joined us. To me, that kind of checks that box that it’s working.” At the same time, Higginbotham is deeply focused on “old-fashioned organic growth,” the CEO says, which involves
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The Higginbotham Community Fund was established in 2011 to provide financial support to non-profits in locations where the brokerage does business. Employees contribute the funds and can request grants for the organizations they want to support in their local communities. The fund has raised more than $5.2 million in contributions and pledges, and distributed grants to over 1,600 non-profits. During the COVID-19 pandemic, a fund initiative supported the restaurant industry, first responders, and others in need. Insurance can be a competitive business, but Higginbotham has also sought to “turn lemons into lemonade” and support rivals in times of need. The leader recalls when
HIGGINBOTHAM INSURANCE AGENCY 1989 Reid appointed CEO of Higginbotham Higginbotham starts its employee ownership journey
2011 The Higginbotham Community Fund is established
2023 Higginbotham celebrates its 75th year in business
Higginbotham offered to help competitors in the aftermath of Hurricane Harvey. “In our case, we had over 5,000 clients that were impacted by Hurricane Harvey – not only did we have the bandwidth to help and support them, but we knew many of our competitors were in a tough place,” Reid says. “We wanted to help them.” For Reid, Higginbotham’s core values of being family to its employees and generous to its communities is the secret to its longevity and continued growth. “Moving forward, we’ll just continue to think innovatively about how we can be the absolutely best place for our employees to work, the absolute best advocate for our clients, the absolute best partner of our carriers,” he says.
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MANAGE RISK. CHOOSE A WSIA MEMBER.
Some decisions are too precarious to take on alone. Sometimes you need a partner who can help you create the right solution for your client’s risk, while minimizing yours. In fact, it’s so cost-effective that a recent analysis by Conning, Inc. concludes that wholesale distribution does not increase the cost to the insured. That’s a good decision.
WSIA MEMBERS ARE INSURANCE PROFESSIONALS DEDICATED TO THE WHOLESALE DISTRIBUTION SYSTEM.
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wsia.org/findamember
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FEATURES
SECTOR FOCUS: SPECIALTY INSURANCE
Where underwriting comes first and foremost How an underwriting-first mindset, higher risk retention, and Lloyd’s of London training make AM Specialty a specialty insurance leader AM SPECIALTY Insurance is a place where underwriting comes first. The Dallas-based company offers a unique partnership opportunity through its “underwriting-first philosophy,” according to its founder and CEO, Shevawn Barder. “We utilize a uniquely results-oriented approach, and we are committed to providing sustainable, long-term value to our clients and partners in the US speciality insurance market.” Along with their underwriting-first model, they boast higher risk retention and dual functionality on both primary and reinsurance bases, which sets them apart in the industry, demonstrating a genuine commitment to aligning with the long-term interests of their clients and partners. “By leveraging this model, we see opportunities for growth and differentiation, even in a highly competitive, complex, and evolving market landscape,” says Barder. Their strategy has been developed through their Lloyd’s of London training, which has allowed them to create a unique approach to underwriting in both the primary and reinsurance spaces. Barder notes that the company “stands out in
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the marketplace through an unwavering commitment to underwriting excellence and a higher risk retention of up to 30 to 50 percent on any one program.” As a result of this strategy, the company is better aligned with the best interests of their clients and the reinsurance capacity that supports the programs. This leads to stable and trusted partnerships, which
and reinsurance spaces offers unparalleled flexibility and commitment to our partners’ business needs,” says Barder.
How does it work to be an underwriting-first carrier? But what does it mean for AM Specialty to be an underwriting-first carrier? “It means that we emphasize gener-
“We’re actively engaged in understanding, managing, and retaining a significant portion of those risks in each program to enhance our clients’ business models” Shevawn Barder, AM Specialty Insurance create stability and sustainability over the long term. For MGAs, brokers, and reinsurance capacity, this means access to a partner that understands the complexities of risk and is willing to retain a higher proportion of it. “Our dual functionality in both primary
ating underwriting profits through careful risk assessment and management,” Barder says. “Through underwriting discipline and confident risk retention in every program supported, the company fosters a sense of trust with partners, highlighting belief in the quality of the risks we underwrite.”
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Brought to you by
Other carriers may be more focused on fee generation, but AM Specialty strives for a more responsible and stable growth pattern based on the fundamental principles of underwriting. As such, “we believe this focus leads us to more robust and sustainable business relationships,” she says.
For MGAs and brokers, this translates into a carrier that understands “their clients’ unique needs, is committed to robust coverage, and provides stable support,” she says. AM Specialty has a higher risk retention, which means that they have a “vested interest in every program we support,” she
says. “We’re actively engaged in understanding, managing, and retaining a significant portion of those risks in each program to enhance our clients’ business models.” “That leads to greater trust,” Barder says. “For our clients, this translates into a more stable and committed partnership, allowing us to offer tailored capacity solutions that fit
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FEATURES
SECTOR FOCUS: SPECIALTY INSURANCE Brought to you by
responsible and engaged partners and can position carriers uniquely in a market where reinsurers are most selective.” Even with the competitive market, Barder is adamant that, when looking at the evolving needs of clients and the dynamic nature of risks, there is “absolutely” room for growth within the market, especially for carriers that can provide tailor-made solutions and demonstrate responsible risk management. “By continuing to innovate and adapt to the ever-changing landscape, we believe that AM Specialty is well positioned to capitalize on emerging opportunities and trends and offer our partners avenues for expansion and success,” says Barder.
Focus on the future and the wider insurance community
“Through underwriting discipline and confident risk retention in every program supported, the company fosters a sense of trust with partners” Shevawn Barder, AM Specialty Insurance their unique needs and create opportunities for growth and collaboration.”
Setting yourself apart in a competitive market In this competitive market, reinsurers can afford to be more selective than ever, but AM Specialty believes it has found a
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key to success, specifically, “a relentless commitment to underwriting principles, building trusted relationships with MGAs, brokers, and reinsurers, and proactive risk management,” Barder says. “Companies need to remain focused and results-driven. Maintaining higher risk retention also helps companies appeal to reinsurers looking for
So how do future opportunities present themselves in this market? For Barder, the best opportunities, along with pursuing underwriting excellence, come through forging deep strategic partnerships with clients and partners, leveraging technology to enhance underwriting processes, and finding innovative ways to respond to a changing landscape. “By maintaining our focus on these core principles, we can continue to build strong relationships with reinsurers and provide unparalleled value to our partners,” she says. While the market remains competitive, Barder says she and her company feel a “dedication to our clients and the broader insurance community. Our focus on underwriting discipline and actively participating in the business we write isn’t just a business strategy; it’s a philosophy that reflects our responsibility to our clients, partners, and the broader community. It’s an approach that ensures we’re here for the long term, providing reliable, sustainable solutions for all our stakeholders.”
www.ibamag.com
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PROFILE
Amwins DNA is a suite of data and analytics capabilities – representing a robust, data-driven approach to doing business in the industry. While the Amwins DNA brand is new, the approach is not. It is foundational to how Amwins supports our industryleading team, our retail clients and our markets. What does this mean? Unmatched support for our brokers and their placement teams, making sure we find the best solution for our retail clients’ insureds
Equipping our retail clients with tools such as coverage benchmarking to ensure placement efficacy
Enhanced ability for our underwriting teams to build capacity and create new products and programs
Identifying opportunities for our teams to assist our carrier partners in targeting classes of business that match their underwriting appetites
Amwins DNA is: − A clear demonstration of why we believe in our vision and business model − Part of who we are because we have collected data and invested in proprietary analytics technology from our founding − An advanced service and sales tool − Proprietary to Amwins 22
− Made possible because of our people and relationships www.ibamag.com
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Our data can beat up their data. That’s what all these ads are supposed to say right? “We’ve got more zeros and ones than anybody!” But, that’s not the point. Data only matters if it helps you win. We never forget this. That’s why we call our firm-wide data initiative Amwins DNA. We’re happy to have our geeks talk to your geeks about it for hours. Or, you could enjoy the advantage it gives you as: We help you win.
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We help you win.
24/08/2023 3:06:26 am
04 PM
INTRODUCING GALLAGHER AGENCY ALLIANCE
Helping small business specialists face the future, while honoring their legacy Preserve your legacy and plan ahead: Elevate your agency’s heritage with strategic succession planning. Build relationships and fuel growth: Focus on nurturing client connections and business growth, while we handle the administrative tasks. Access a vast network and retain your identity: Join our expansive network, while preserving your agency’s unique character and strong client bonds. Cultivate collaborative growth: Thrive in a community of agencies like yours, fostering business client growth. Seamless integration, enduring values: Connect with a larger network, while safeguarding the values that resonate with your clients.
Visit us online to learn more about Gallagher Agency Alliance. © 2023 Arthur J. Gallagher & Co. | GGBUS45162
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Confidently small business
PROFILE
Take your plans forward and grow your agency with Gallagher Agency Alliance Gallagher Agency Alliance brings
Jen Tadin, MD — Global Small Business
together local community agents to
and President of Gallagher Agency
unlock growth in the small business
Alliance has focused a 20-year career in
insurance segment, provides access to
the SME market. “The thing I really
strategic carrier partners and the
respect about Gallagher is that we started
specialist knowledge to power the future
out as a small, family run business and
for independent agencies.
have not lost sight of where our story
We’re helping agencies across the US to elevate their business for employees, clients and agency ownership. Whether that’s tapping into Gallagher’s specialist capabilities and expertise, benefiting from access to exclusive markets or
began. Although we’ve since grown to a 48,000 people business, Gallagher still feels like a family of small businesses, but with big brand impact and market power. That’s the Gallagher Way and we’re proud of our heritage.
simply being part of a larger network
I’ve experienced the small business
and family of insurance brokers while
insurance marketplace from all
remaining a local agency and trusted
sides — working with multiple insurance
advisor to the business community, the
companies, moving over to become a
Gallagher Agency Alliance could be the
broker and advisor, and working closely
right partnership to pursue.
with small business owners to truly
Agency owners reach a point in time where two big milestones often arise. 1) I love being in the thick of conversations with customers and helping them with their insurance needs, but there’s little time to do that as I’m wearing multiple hats. I want to get back in the driver’s seat
Helping business around the world to face their future with confidence.
understand what makes them tick. Being there as a partner for the big moments of magic and riding out tougher times
As part of the alliance you will benefit from: Access to markets exclusive to Gallagher
Tapping into specialist insurance and risk management capability
Networking and partnering with other Gallagher Agency Alliance agencies
together, it’s safe to say that I love all things small business and the critical role
Extending your existing product
insurance and insurance agents play in
and service offering to bring new
helping them move forward.”
value to your customers
and closer to customers. 2) Succession
Small business is all about relationships
planning is top of mind and a big concern
and being a trusted community partner.
Winning larger accounts with
for me right now. I want the business to
It’s about family, kids playing baseball
support from the Gallagher team
remain in safe hands while also preserving
together, grabbing a coffee to discuss
our legacy in our community. Merging
future plans and generations of industry
Retaining your focus and taking
with Gallagher can solve one or both of
experience being passed down the line.
your plans forward
these challenges.
Ready to take the next step? Let’s talk. Gallagher Agency Alliance AJG.com/AgencyAlliance 24
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45162
FEATURES
SECTOR FOCUS: CONSTRUCTION LIABILITY
Construction’s environmental and professional liability balancing act Westfield Specialty addresses complex risks that arise when environmental and professional liability policies meet in the construction industry
MARKET FAC T O R S , including contractual and lender requirements, continue to drive contractors to purchase environmental and professional insurance. As coverage requirements broaden and contractors seek to maintain margins, demand for efficient insurance solutions rises. A combined environmental and professional liability program could be the solution. While these combined programs are not new to the marketplace, they are evolving, the risks are shifting, and insurance carriers must adapt to ensure they can keep up with and effectively manage emerging market trends. The trends we are keeping a close eye on at Westfield Specialty Environmental fall into two different buckets: (1) common and well-documented environmental and professional risks and (2) new or emerging
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environmental and professional risks. From an environmental perspective, mold and per- and polyfluoroalkyl substances (PFAS) are two of the most discussed risks. Professional liability risks tend to focus on construction management and design risks. The more nuanced and less discussed issues include where and how risk is shifting, new risk classes seeking to access coverage in the environmental and construction marketplace, and how carriers can best interact and serve the target clients within this evolving market.
New and shifting risks With increased economic pressures, labor shortages, and costs of goods, there is immense pressure on construction clients to grow revenue. One such way is by diversifying the services they offer. We have seen general contractors, who are not
typically responsible for design services, advertising and pursuing design/build contracts. In the best cases, the experts needed are being engaged; in other cases, we are seeing the general contractors trying to take on these services themselves. This could lead to costly mistakes for the contractors and their carriers. Assessing a client’s qualifications, history, business practices, and strategy is essential to understanding this dynamic risk landscape. Certain pressures within the liability insurance marketplace are also driving change. While the Pollution and Professional market for contractors is generally stable, other related markets, like Architects & Engineers, are more volatile. That volatility impacts the availability of coverage and increases the cost of insurance. A contractor who had coverage through an A&E program may seek to find coverage from other
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Brought to you by
“Assessing a client’s qualifications, history, business practices, and strategy is essential to understanding this dynamic risk landscape” Dennis Willette, Westfield sources. A perfect example is the influx of owner representatives/agency construction managers into the Contractors Pollution and Professional market. Those carriers
with strong construction professional experience, including A&E, will recognize the risk that this shift presents. However, carriers with a heavier environmental focus
may not be aware of the distinct differences in risk or how best to structure coverage for those clients. We take immense pride in the diversified environmental and professional experience we can leverage at Westfield Specialty Environmental to ensure we can accurately assess and underwrite these shifting and new risks to provide strong, meaningful, and sustainable insurance solutions.
A growing marketplace Not many years ago, as contractual requirements for artisan trade contractors
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FEATURES
SECTOR FOCUS: CONSTRUCTION LIABILITY Brought to you by
were becoming more prevalent, contractors would argue they did not have an environmental exposure. Whether it was instances of job site releases, exacerbation of existing contamination, or mold concerns, we can now see that there was indeed a need for environmental coverage. Those same contractors are now being required to carry professional liability as well, and they are reacting the same way – “I don’t have a professional exposure.” Many times, the exposure may be quite limited. In those instances, how carriers provide a solution to those contractors is essential to their success. At Westfield
risk management tool. Westfield Specialty Environmental provides meaningful coverage to small and middle-market project owners and crafts complex coverage solutions for larger clients. We offer both primary and excess capabilities for all our products and apply our capacity wherever we can best serve our clients.
The Westfield Specialty difference While there are many carriers that offer environmental and professional liability coverage solutions, when you evaluate how they are offering those solutions, the list of top-tier carriers narrows. A core principle
“We recognize there is no silver bullet, and we must meet clients where they are” Dennis Willette, Westfield Specialty Environmental, we recognize there is no silver bullet, and we must meet clients where they are. We seek to provide an efficient, streamlined experience for low-risk clients while offering broad, meaningful coverage. As we grow, we will leverage technology to further enhance those customers’ experiences. For all other clients, we leverage our extensive environmental and professional experience to craft an insurance program to meet their needs. As more contractors buy environmental and professional liability insurance, so do project developers and owners. Claim development and severity increases make an owner’s protective program an essential
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of Westfield Specialty Environmental that we feel will keep us at the top of the list is taking care of the basics: providing responsive and efficient underwriting and servicing, offering broad and meaningful coverage through our core products, and supporting our clients with experienced and reliable in-house claims support. It sounds simple, but not every market is doing it. Westfield Specialty Environmental underwriters structure coverage based on the size and nature of the risk. We recognize the need for efficient solutions for low-risk contractors, so we deploy our underwriting approach to meet their needs and expectations. This is highlighted by
our automatic renewal enhancement for select contractors. We provide the same level of service to all sizes of accounts. We partner with our brokers to find the right solution for each client. The carriers that approach coverage as a true partnership and work with brokers to build business together will create sustainable long-term relationships. Construction-focused products providing environmental and professional coverage serve as the foundation that Westfield Specialty Environmental will build upon. We will deploy a broader set of environmental products in 2024 and beyond, including site pollution, a storage tank program, and blended casualty products. Westfield Specialty’s environmental underwriters understand the nuances of this industry, the operational and service risks, as well as the financial impact facing contractors each time a new project commences or a contractor-related professional liability exposure exists. We are always looking to innovate. We believe our people make the difference. Dennis Willette, senior vice president environmental, leads Westfield Specialty’s environmental team. He has 15 years of experience in technical environmental consulting and insurance. The carrier has a broad appetite supporting construction and environmental contractors of all sizes, with coverage written on non-admitted paper, with a group rating of “A” (Excellent) by AM Best and available in all states, primarily via wholesalers. Westfield Specialty underwrites in five other lines of business: E&S property, E&S excess casualty, professional lines, financial institutions, and management liability. Learn more at www.westfieldinsurance.com/ insurance/specialty.
www.ibamag.com
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Westfield Specialty
People Make the Difference
“We are excited about the opportunity to establish a broad and diverse portfolio of specialty business through deep relationships and expertise of our highly regarded talent. We’re building something that will stand the test of time.” — Jack Kuhn, President, Westfield Specialty Westfieldinsurance.com/specialty #OurPeopleMaketheDifference Westfield has a 175-year history and AM Best “A” rating.
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PROFILE
2023 Insurance Business America 5-Star Program Administrator Meet RPS Signature Programs, your go-to underwriting resource for agents and brokers looking for specialized coverage. 866-595-8413
contactRPS@rpsins.com
RPS SIGNATURE PROGRAMS represents the collective power of a leading program administrator. It offers proprietary solutions on an admitted and non-admitted basis across a broad variety of niche markets that require specific underwriting, marketing, and distribution expertise. Program administration is a vibrant and ever-growing segment of the P&C industry. RPS Signature Programs is well positioned to accelerate existing programs, develop new programs to meet the needs of niche markets, and work with independent agents looking to grow their business with a trusted partner. According to the Target Markets Program Administration Association’s (TMPAA) State of Program Business Study 2021, program business reached $53.8 billion in premiums. In fact, it’s growing more quickly than the overall commercial insurance marketplace. That’s why our program administration division is comprised of thought leaders who are passionate
RPSins.com/SignaturePrograms
about building programs and delivering tailored and exclusive solutions to clients. Boasting numerous program niches and a premium nearing $950 million, supported by 200 industry experts, we encompass many sought-after classifications and lines of business, from public entities and schools to crane and rigging, as well as professional liability. The role of a program administrator is to enhance your client-facing image for mutual benefit – a win-win situation. RPS Signature Programs adds value to both retail partners and carriers, not only capitalizing on the strength of a larger entity but also emerging as a reliable underwriting resource, offering expertise and passion to every niche. Our team of industry specialists adeptly handles intricate client needs through exclusive programs; RPS excels in distribution and invests significantly in branding and technology. We help take care of the risk, so our partners can move on with confidence.
RUSSELL DUFFEY, PRESIDENT – RPS SIGNATURE PROGRAMS Since 2022, Russell Duffey has served as president of the RPS Programs division where he leads all operational activities including strategic planning, budgeting, marketing relationships, and execution of business plans for programs within the division. “We look to differentiate ourselves through our knowledge and expertise in our various areas of practice. This expertise leads to improved risk selection and underwriting. Additionally, the investments we’ve made in technology and data management are and will be differentiators,” Duffey emphasizes.
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In addition to bringing a strategic approach to market relationships, Russell also launched SmartMarket for RPS and a new suite of Edge products, both giving RPS a competitive advantage in the marketplace with clients and carriers alike. “We are solving for our clients’ needs and helping them become successful,” Duffey says. Duffey holds a bachelor’s degree in Business Administration, Risk Management & Insurance from Georgia State University and has also earned the Certified Insurance Counselor designation from the National Alliance for Insurance Education & Research.
PRODUCTS A Sampling of RPS Signature Programs Now Available: • All Lines Aggregate • Amateur Sports • Bicycle and Ski • Camp, Conference & Retreat • Crane & Rigging • Garagekeepers • General Business • Golf & Country Clubs • Health & Fitness Clubs • Inland Marine • Insurance Agents & Brokers • Lawyers Professional Liability • Podiatry Professional Liability • Public Entity • Real Estate Agents and Brokers E&O • Real Estate Appraiser E&O • Rental Equipment • Scaffolding Access • Social Services • Title & Escrow Professional Liability • Lacrosse • USA Softball • Workers’ Comp Self-Insurance Groups
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5 STARS That’s our
Insurance Business America is showcasing the best insurance program administrators in the country and RPS Signature Programs is thrilled to be named a 5-Star award recipient!
Visit our program marketplace to see why. RPSins.com/signatureprograms
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PROFILE
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www.ibamag.com
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SPECIAL REPORT
2023
NETWORKS AND ALLIANCES
The 2023 Insurance Business America Networks and Alliances awards celebrate the groups that help independent agents thrive
CONTENTS
PAGE
Feature article............................................................ 34 Methodology ............................................................. 35 Winners ...................................................................... 38
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SPECIAL REPORT
5-STAR NETWORKS AND ALLIANCES 2023
FINDING FELLOWSHIP AGENTS CAN be supercharged by connecting to insurance networks. The topperforming networks harness a range of benefits such as greater access to products, the ability to tap into non-traditional markets, vendor discounts, and even marketing support. However, finding the right network is key.
To that end, Insurance Business America’s 5-Star Networks and Alliances 2023 recognizes some of the best in the industry as ranked by agents across a range of criteria. These groups are making a resurgence, says John Tiene, managing director of Strategic Agency Partners.
“I tell my agents, you’re part of my family” John Tiene, Strategic Agency Partners
ACCORDING TO RESPONDENTS WITH NETWORKS, WHAT ARE THE BENEFITS OF BEING PART OF A NETWORK OR AN ALLIANCE? Commissions and profit share
81% Access to more insurance companies and products
75% Overall business consulting
29% Access to niche and non-traditional markets
25% Training and education
24% Marketing support
23% Access to technology
13% Administrative support
9% Vendor discounts
9% Perpetuation planning
3%
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“There was a time when agents worked together to take care of their community,” he says. “Sometime between the 1970s and 1990s, that got lost. But it’s back, insurance is about scale. The more scale, the more influence and opportunity exists.”
One for all Strategic Agency Partners is one of this year’s 5-Star winners. “There’s a demand within the agent community for what we provide,” explains Tiene. “We help them better manage their agencies. Help them utilize technology. Help with perpetuation – that’s just good business planning. If you get hit by a bus, what happens to your agency?” By joining Strategic Agency Partners, agents can expect to:
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It takes a fine-tuned team to help drive success. You need a highly-committed crew to make it into the IBA 5-Star Program Administrator and Carrier winners circle. We are proud to be recognized for our reputation as a responsive carrier, the strength of our relationships, and our strong commitment to innovation during even the most challenging of times. Our dedicated, knowledgeable team works in close partnership with our clients to help move success forward. Munich Re Specialty Insurance Offering innovative program solutions with superior service levels, and simplified access over 25 years. munichre.com/specialtyinsurance Scan for more information
© Copyright 2023. Munich Reinsurance America, Inc. All rights reserved. Munich Re Specialty Insurance (MRSI) is a description for the insurance business operations of affiliated companies in the Munich Re Group that share a common directive to offer 37 and www.ibamag.com deliver specialty property and casualty insurance products and services in North America.
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SPECIAL REPORT
5-STAR NETWORKS AND ALLIANCES 2023
• increase contingency revenues into the double digits • acquire advice on deploying additional capital to improve operations • improve employee retention or attract more staff • leverage technology to improve efficiencies • act like business owners in a group setting • further empower women who account for 70% of agency employees Some survey respondents had their reservations about joining a network. Reasons cited by some agents were that networks: • make members do things they don’t want to do • pry into members’ client files • withhold payment unless a commission goes to one central agency
Since forming in 2022, Fortified has been able to: • establish 61 agents in eight states • be present in over 170 locations and 1,800 employees • achieve close to $3 billion in written premium Craven also offers a real-time assessment of issues faced by agents across the US, which can be alleviated by joining networks like Fortified. “The rising cost of repairs, the rising cost of materials, are all having an impact on rates of the insurance companies,” he says. “They can’t get enough rate quick enough to be able to turn a profit. This has been going on for nearly two years, and we’re going to still be in this for another two years.” Uniting 54 independent agencies across the southeast US, Fortified offers the following services:
“I think carriers prefer working with us because they can more cost effectively manage growth and profitability” Robert Qaoud, Valley Insurance Agency Alliance However, Joe Craven, CEO of 5-Star winner Fortified, explains why he feels this is an outdated perception. “What they’re saying is the furthest from the truth,” he explains. “We don’t have any of the client information. We don’t take their commissions.”
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• helps manage carriers on their behalf • encourages collaboration • leverages its history of profitability to maintain good standing with carriers • provides better profit sharing • negotiates better vendor agreements
METHODOLOGY Insurance Business America reached out to agents nationwide to find out which networks and alliances are helping them reach new heights. The survey asked respondents to rate the performance and service of their networks on a scale of 1 (poor) to 10 (excellent) against the following 10 criteria: • access to insurance companies and products • commissions and profit share • access to niche and nontraditional markets • marketing support • training and education • administrative support • access to technology • overall business consultation • perpetuation planning • vendor discounts The networks and alliances that earned an average score of 8 or greater in at least one category were awarded a 5-Star designation. Networks and alliances that received an average score of 8 or greater in all categories received an All-Star designation.
“Independent agencies are the foundation of our industry,” explains Craven. “They’re small businesses that work hard to provide the best coverage possible for their clients, but unfortunately, being a ‘small’ business can make it harder to develop partnerships with carriers. Fortified is a collection of independent agents with similar core values.” Director of operations Robert Qaoud of fellow 5-Star winner Valley Insurance Agency Alliance (VIAA) also knows how
Year, after year, after year
REInsurePro is the solution to property and liability insurance challenges faced by independent insurance agents and their residential real estate investor clients. Our Program is the gold standard, featuring monthly reporting and billing for investors with any number of properties. Our innovative online platform allows agents to quote and bind coverage, submit to underwriting when required, and access a Sales Manager to answer any questions and help with complex portfolios. We offer customizable coverage packages with a suite of ancillary options to meet the needs of each investor. Do you have clients that could benefit from this 5-star program? Go for the gold! We are actively seeking agent partners. Visit REInsurePro.com/5Star to get appointed with us. www.ibamag.com
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SPECIAL REPORT
5-STAR NETWORKS AND ALLIANCES 2023
ACCORDING TO RESPONDENTS WITHOUT NETWORKS, WHAT PREVENTS THEM FROM JOINING A NETWORK OR AN ALLIANCE? Cost/loss of commissions
36% Not meeting requirements
36% Perceived loss of independence
29%
• provide a more cost-effective carrier relationship than a standalone agency • have a special collaborative spirit resembling a “brotherhood” • offer access to markets, business consulting, and profit sharing
Sharing of clients
21% Negative past experience
14%
“Members can lean on each other’s expertise and that goes a long way for members that are coming in. We also do a really good job of managing the relationships with the carriers on their behalf ” Joe Craven, Fortified transformative a network can be for agents. “Some of the other networks out there can really ruin it for the good ones,” he says. “Plus, there’s a lot of myths out there. If we can get them to listen, we can show them the value and the reality of what we have to provide versus the perceived loss of independence.”
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Director of enterprise development Bill Kaatman adds, “There are some enhanced commissions we provide, and we negotiate at a local or a national level. We run our numbers and we are very keen to the fact that we have a majority of our members who we pay more than they pay us, and we’re extremely proud of that.” The family of Pierce and Sue Powers formed VIAA in 2006 to help small agencies meet common challenges and they:
With VIAA, • 89% of members make more with profit sharing and override the network membership costs • 165 members have over $600 million in-force premium
“We’re nothing without our members,” explains Qaoud. “We’re fortunate just to work with really good people. We have core values, and unless a prospect exudes those values, we don’t work with them. We really want to work with good family people and help them enhance their legacy.”
Network strength Many of the major issues in the industry are a knock-on effect of the pandemic. However, that allows insurance networks to show their added value by assisting agents in a challenging economic climate. “COVID happens,” says Tiene. “People aren’t driving. Regulators say you have to give customers’ money back. So, they forced carriers to either give credit or reduce rates. The commercial side was a bit easier. People were being laid off – we could do some stuff there. “Meanwhile, supply chain issues are
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Workers compensation for the companies that build America and keep it working
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SPECIAL REPORT
5-STAR NETWORKS AND ALLIANCES 2023
creating costs, so I can’t get the fender I need to put on my car. So, the rental car is going to be out a little longer. Then, because of the supply chain, the prices go up and then people start driving again, so frequency and severity go through the roof. Meanwhile, the regulators are still saying, ‘Well, it’s COVID.’ “You layer inflation on top of that and you layer climate impact on frequency and severity – and this is just the worst of everything.”
According to Tiene, networks help agents deal with these conditions by:
date some of the impact from pricing pressures
• keeping them informed of the forces impacting them and their clients • collaborating with insurance company partners to gather information they may use with their clients, for example, why costs are going up • leveraging partnerships with insurance company partners to accommo-
And in relation to regional issues such as legislative changes in Florida and California, plus the challenging coastal regions, Tiene adds, “Being part of a network gives our members the flexibility and options to place those renewals with other markets because we offer much greater market access than your typical independent agent has access to.”
NETWORKS 2023 AND ALLIANCES Iroquois Group
Strategic Agency Partners
Phone: 8430 568 5543 Email: dward@iroquoisgroup.com Website: iroquoisgroup.com
Phone: 609 923 5280 Email: jktiene@strategicagencypartners.com Website: strategicagencypartners.com
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Five myths about purpose Everyone wants and needs to find purpose in their work. But according to Aaron Hurst, doing so requires shattering some common myths
MOST OF what we understand about purpose at work comes from Hollywood. Stories are a powerful way to learn, but most of the stories we see on screen give us a romanticized view of the role of purpose in our work. They build myths about purpose that actually make it harder for us to focus on what matters. But perhaps the most unfortunate aspect of these myths is that they imply that purpose is not something for everyone, which – based on my experience working with thousands of professionals, as well as emerging research on the topic – couldn’t be further from the truth. Myth 1: Purpose = cause In working with thousands of professionals seeking purpose, the greatest barrier has been the ubiquitous belief that they have to find their cause. When business professionals leave Taproot’s pro bono consultant orientations, they are usually fired up and want to get on a project immediately. They can’t wait. That being said, on one of our earliest projects, we were having a difficult time getting any of our largely gen-x, pro bono marketing consultants to join a team. The project was branding and naming work for a critical organization serving low-income
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seniors in one of San Francisco’s most challenged neighbourhoods, the Tenderloin. When I pitched the project to our pro bono consultants, they begged for a different project. “I totally get that seniors are important, but I’m 32, and it really isn’t an issue that gets me excited,” they said. “Do you have anything focused on kids or the environment? I am really passionate about helping kids and the
Francisco. It turned out they had not only done a world-class job with the organization’s brand, but they had become an ongoing marketing committee for the organization, and several of them had become donors. So many of us who are looking for a cause think we have to find our one true calling. We want to know that our mission is to help save one-legged kittens or find a cure for cancer.
Purpose is about finding a direction, not a destination… We may never find one true calling, but we can understand the color of our purpose, which can help us have much more meaningful careers and lives environment. That’s our future.” We shared with them the dire needs of the organization and asked them to be open-minded and give it a try. If, at the end, they were unsatisfied, we would give them first dibs on the next round of projects. They reluctantly agreed. Nine months later, I received a surprising email. The leader of the pro bono consulting team was urging me to attend a session at City Hall to protect funding for seniors in San
Hollywood stars helped popularize this notion with their high-profile focuses on particular issues, such as George Clooney (Darfur), Brad Pitt (New Orleans), Angelina Jolie (refugees), and Matt Damon (water). I’m also guilty of feeding into this way of thinking. When you are seeking resources or attention, being able to point to your success as part of your destiny works incredibly well. People want to hear that you knew you were
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FEATURES
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money and security. Purpose is a universal need, and even those in challenging situations still make it a priority. Arguably, the most famous advocate for purpose in history is Viktor Frankl, who wrote about the importance and presence of purpose in Nazi concentration camps, where he lived during the Holocaust. He found that purpose was key to his survival. “Everything can be taken from a man but one thing: the last of human freedoms – to choose one’s attitude in any given set of circumstances, to choose one’s own way,” Frankl famously wrote in Man’s Search for Meaning. It turns out that in many ways, the prioritization of purpose is inversely correlated with wealth. Money often conflicts with finding purpose, as it creates a false substitute for defining success.
Myth 3: Purpose = revelation going to be a doctor/basketball player/president/entrepreneur the minute you took your first step, still wearing diapers. Once you’re successful, you’re expected to tell a version of your biography that supports this mythology. Destiny makes for a powerful story, but this concept is not only misleading – it also does the next generation a great disservice, as it sets unrealistic and unhealthy expectations. Nearly all the early-career professionals who seek an informational interview with me lament that they haven’t found their cause yet. And while there are certainly people who are driven in this singular manner about a cause, it is almost always the result of a personal tragedy or an experience that inspired them to act. Maybe they were touched by the death of their mother from cancer, or their child died from gun violence. Still, this holds true only for a very small percentage of people, and it is by no means the only way to find purpose. For the rest of us, seeking our purpose is about finding a direction, not a destination. Purpose is a verb, not a noun. We may never
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find one true calling, but we can understand the color of our purpose, which can help us have much more meaningful careers and lives.
Myth 2: Purpose = luxury Why do the poorest Americans donate 3.2 percent of their income to charity, compared to the wealthiest, who donate only 1.3 percent? Why do people living in wealthier neighbourhoods appear to be less generous? Why also are those with the least money, education, and prestigious jobs more likely than their wealthy counterparts to say that they would keep their job even if they suddenly were financially set for life? Why would a janitor continue to work if he won the lottery and an investment banker take an early retirement? If you talk to people in less prestigious jobs and in poorer communities, they aren’t surprised by these facts. They see it every day and experience it firsthand. As a reverend in south central Los Angeles told me, “Being poor isn’t so bad; it’s just inconvenient.” Purpose isn’t a luxury only for those with
Connected to the myth that purpose is about a cause is the myth that we discover our purpose in one fell swoop. We’re just walking along, minding our own business, when – bam! – our life’s calling is transmitted to us like a bolt of lightning from above. True, this is usually how superheroes find their purpose. Batman saw his parents murdered, and it became his purpose to fight crime in Gotham City. Superman discovered that his people were wiped out because of civil war and found his purpose in fostering peace and civility. But the reality is that this is not how it usually happens for us mere mortals. “We don’t receive wisdom; we must discover it for ourselves after a journey that no one can take for us or spare us,” Marcel Proust famously observed. When I shared this insight with a group of international graduate students at Oxford, they suddenly became visibly disturbed. Noticing the change in mood in the room, I asked them what had happened. After an awkward pause, one woman raised her hand and answered that she had come to graduate school looking for a revelation. She
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FEATURES
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didn’t know what she wanted to do in her career but figured that she would leave with clarity about her purpose. Slowly, everyone started nodding their heads. They had had the same realization – that one of their main reasons to attend graduate school (and go into debt) was to have a revelation. Most of us will work for 45 to 50 years. Think about that for a second. That’s the same amount of time it would take to attend college 12 times. And it’s increasingly true that during that time, we will hold many different jobs, and for more and more of us, those will be in a range of fields. We have so many opportunities to find the work that best suits our perspective on the world and the way we most enjoy contributing.
Myth 4: Purpose = only some work Administrative assistants spend their days supporting executives and have little autonomy or control over their workflow. Much of their work is repetitive and stressful, but it pays the bills and enables them to have the income they need to support the rest of their lives. It’s just a job – a 9-to-5, right? Well, yes and no. It turns out that this is true, but only for about a third of administrative assistants, and perhaps more surprisingly, it’s also true for about a third of every occupation. What we do is not nearly as important as how we do it and what attitude we bring to the work. As the saying goes, “Wherever you go, there you are.” What we get from work has more to do with us than the work itself. Work plays very different roles in people’s lives. For some people, a job is simply a job. For them, work is a paycheck, and they don’t seek anything else from it. It enables them to have the money to enjoy their lives outside their job – they aren’t looking to derive meaning from their work. Those with careers care more
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deeply about their work as a way to get ahead within their profession or function. It brings social status and power, which boosts their self-esteem. Finally, those with callings fully integrate their work into their lives and values. They see work as integral to who they are and part of their lives. Amy Wrzesniewski and her colleagues found that across occupations, there were
monotonous practice. Winning the race or game is amazing, but their satisfaction stems from their deep investment. With athletes, the relationship between pain and gain is clearest, but the same holds true of doing any work where we are experiencing high levels of purpose. Even when doing work that is making a big impact, if there is no skin in the game, the depth of
Purpose isn’t a luxury only for those with money and security. Purpose is a universal need, and even those in challenging situations still make it a priority fairly even divides between people who saw their work as a job, career, or calling. It reinforced previous research that demonstrated that the ways individuals view work may be more tied to their psychological traits than to the work itself. Another study by Wrzesniewski showed correlations between experiencing work as a calling and overall well-being and health. This implies something very important: It is in your best interest to see work as a calling, and as a society, we need to shift more toward calling-based work.
Myth 5: Purpose = easy Running a marathon hurts. There are the blisters, the chafing, the body aches. And yet, completing a marathon is something that many report as being incredibly meaningful. It pushes runners to their limits, both physically and emotionally. Professional athletes make it look so easy. When we watch them, they appear natural and effortless. In reality, athletes work incredibly hard and endure tremendous pain to be successful. As fans, we rarely witness the injuries or watch the thousands of hours of
purpose is diminished. Viktor Frankl also said, “Man’s main concern is not to gain pleasure or to avoid pain, but rather to see a meaning in his life.” As Jennifer Benz put it, “Purpose doesn’t free you from working hard and being challenged – it will actually inspire and drive you to put yourself further out of your comfort zone. The falls will be harder, but the wins will feel so much better.”
The truth about purpose Purpose is for everyone, regardless of our profession or socioeconomic status. It is not about a cause or something that we discover by revelation. It is a challenging and rewarding journey.
Aaron Hurst is the foremost expert on the science of purpose at work. In 2014, he brought global awareness to the rise of the fourth economic era in history, the purpose economy. He is the author of The Purpose Economy: How Your Desire for Impact, Personal Growth and Community Is Changing the World and the co-founder and CEO of Imperative, the technology platform for leaders in the new economy. For more information, visit imperative.com
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