Insurance Business America issue 4.08

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YOUNG GUNS

Remember these 61 rising stars – they’re the industry’s future leaders IT PAYS TO DO GOOD

Why you should consider specializing in the nonprofit sector

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CLOSING THE GENERATION GAP

What the industry needs to do now to make itself more attractive to millennials

THE OTHER SIDE OF AUTO

The ins and outs of commercial auto and garage insurance policies

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ISSUE 4.08

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CONTENTS

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UPFRONT 04 Editorial

Gaining ground with millennials

06 Statistics

YOUNG GUNS COVER STORY

YOUNG GUNS

22

FEATURES

THE GENERATION GAME The industry needs more millennial workers – so how can it better market itself to this generation?

09 Opinion

Why trying to fight change is a losing game

10 News analysis

How will Brexit impact the world’s leading insurance market?

14 Workers’ comp update

52

INTO HIGH GEAR

What you need to know to provide commercial auto and garage coverage for your clients

Chubb Group’s Paul Krump discusses what’s in store for the company post-ACE merger

18

In light of recent police brutality, is insurance the answer?

This month’s big movers, shakers and new products

FEATURES

INDUSTRY ICON

08 Head to head

12 Intelligence

Meet 61 young professionals who are paving the way for the future of the insurance industry

PEOPLE

44

A look at the dangers of summer pastimes

Workers’ comp underwriting performance is on the up – but how long will it last?

16 Technology update

A new survey offers compelling evidence for shifting business online

FEATURES 56 Agency insight

Higginbotham’s Rusty Reid reveals how the brokerage has made its name by going above and beyond

PEOPLE

FEATURES

58

THE PROFIT IN NONPROFITS

Helping those who help others can pay dividends for brokers in more ways than one

63 Career path

From San Francisco to London to New York, Nicole Goodwin has built her career around emerging risks

64 Other life

On a roll with Kendra Kimball

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5/08/2016 4:23:25 AM

UPFRONT

EDITORIAL

Building trust beyond Boomers

I

ndependent insurance agents are more vital today than ever before. A glance at industry headlines may not convince the layman of that fact, but a new poll from the research group Mintel found that a surprising 51% of millennials (those born in 1980 and onward) believe insurance companies are more trustworthy now than they were five years ago – and agents are a key part of that trust.

Respondents to the survey told Mintel that insurance agents and brokers are vital to the trust-building process – 56% cited producers as the best source of information about insurance products. And despite being decried as the generation most likely to favor tech-enabled insurance purchases over conversation with an actual agent, few millennials have downloaded an insurance app. Just 18% have an auto insurance app, 15% for health, 14% for life and 10% for home.

A surprising 51% of millennials believe insurance companies are more trustworthy now than they were five years ago One thing is certain, though – millennials will be the most important demographic for insurance professionals in the next 10 to 20 years. And to reach them, agents need to understand them. That’s why it’s so refreshing to see a new crop of industry professionals among the millennial generation.

This year’s Young Guns list features exceptional professionals under the age of 35 who have taken the insurance business by storm. Not only have they carved a place for themselves in the industry in just a few short years, but they also have the ability to bridge the age gap common in insurance and bring in more customers from the largest generation since the Baby Boomers.

From across the industry, the triumphant tales of this year’s honorees should help agencies, wholesalers, carriers, reinsurers and other firms recognize the value of a multigenerational presence in the workplace, which will ensure the insurance business remains as strong as ever heading further into the newest millennium.

We hope you will take the time to learn from these Young Guns and the stories they share in order to leverage their unique talents and perspectives to build your business. After all, you’re likely to see even more of their peers coming through your doors in the next few years.

The team at Insurance Business America

www.ibamag.com SEPTEMBER 2016 EDITORIAL

News Editor Caitlin Bronson Staff Writers Tim Garratt, Libby McDonald, Joe Rosengarten, Heather Turner, Ryan Smith Journalists Callum Glennen, Penelope Graham, Maryvonne Gray, Paul Lucas, Jordan Lynn Editorial Researcher Hannah Goh Copy Editor Clare Alexander News Writers Lyle Adriano, Louie Bacani, Mina Martin, Gabriel Olano

CONTRIBUTORS Paul Edwards

ART & PRODUCTION Design Manager Daniel Williams Designer Joenel Salvador Production Manager Alicia Salvati Traffic Manager Kay Valdez

SALES & MARKETING Vice President Cathy Masek Media Sales Managers Chris Wills, Chris Anderson Mktg & Comms Manager Lisa Narroway

CORPORATE Chief Executive Officer Mike Shipley Chief Operating Officer George Walmsley Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil

Editorial Inquiries caitlin.bronson@keymedia.com Subscription Inquiries subscriptions@keymedia.com Advertising Inquiries cathy.masek@keymedia.com, chris.wills@keymedia.com chris.anderson@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

Insurance Business America is part of an international family of B2B publications and websites for the insurance industry Insurance Business Canada john.mackenzie@kmimedia.ca T +1 416 644 874O Insurance Business UK jonathan.connelly@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

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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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UPFRONT

STATISTICS

Dangerous days of summer

MOST DANGEROUS SPORTS The sports most likely to result in a visit to the emergency department are among those most popular in the warmer months, including basketball, biking, baseball and swimming.

With summer’s increased outdoor activity comes a heightened accident risk – especially for minors SUMMER IS in full swing – and as Americans take up water activities and summer sports, they put themselves at greater risk for injuries, property damage and even death.

Children and teens are especially at risk: In 2014, 174 children between the ages of 12 months and 14 years drowned between Memorial Day and Labor Day, according to the Consumer Product Safety Commission. A

Number of injuries treated in ER

66,601

56.4% 11.3%

Roller skating

report by the National Safety Council put the number of swimming injuries treated in emergency rooms that same year at 179,188 – more than 40% of which were children between the ages of 5 and 14. Meanwhile, the Centers for Disease Control and Prevention estimate that 2.6 million children per year are treated in hospital emergency rooms for sports and recreation-related injuries.

Number of injuries treated in ER

66,290

17.8% 16.2%

Fishing Number of injuries treated in ER

52,548

36% 41.9%

Volleyball

40,901

Number of hospital-treated injuries from amusementpark accidents in 2014

46%

Percentage of these injuries sustained by children ages 5 to 14

39,699

Number of injuries treated in ER

1,201

Number of people treated and released

50,688

Number of people hospitalized or killed

20.4% 23%

Horseback riding

Sources: US Consumer Product Safety Commission, 2014

THE PROPERTY DAMAGE COST

DANGER ON THE WATER

Accidents associated with recreational watercraft present more than just a danger for injuries – they also cost millions of dollars a year in property damage.

The five states that rated most poorly for recreational watercraft accidents in 2015 accounted for almost a third of all related fatalities.

1. FLORIDA

2. CALIFORNIA

671 2015

$42 million

2014

$39 million

2013

$39 million

2012

$38 million

2011

$52 million

$0

52

369

174

48

16

227

96

390 5. TEXAS

4. NORTH CAROLINA

$20m

$40m

$60m

Source: US Department of Transportation, US Coast Guard

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3. NEW YORK

Number of accidents

162

154

20

44

90

105 Number of fatalities

Number of injuries Source: US Department of Transportation, US Coast Guard, 2015

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Number of injuries treated in ER

Number of injuries treated in ER

179,188

522,817 42.4% 16.1%

Swimming

34.3% 47%

Basketball

Number of injuries treated in ER

Number of injuries treated in ER

130,376

502,104 49.4% 29.4%

Baseball

33.8% 17.2%

Biking

Number of injuries treated in ER

Number of injuries treated in ER

119,760

396,457 34% 49.7%

Skateboarding

50.6% 40%

Football

Number of injuries treated in ER

Number of injuries treated in ER

100,904

368,904 7.7% 32.8%

Weightlifting

12% 19.3%

Exercise

Number of injuries treated in ER

Number of injuries treated in ER

95,465

239,943 31.4% 33.1%

Softball % of injuries, ages 5-14

43.7% 38.8%

Soccer

% of injuries, ages 15-24 Source: National Safety Council

CONCUSSIONS HIT TEENS HARDEST

EVERY THREE MINUTES

In its analysis of sports-related emergency room injury data for children ages 6 to 19 that covered 14 sports (including basketball, cheerleading, football and soccer), Safe Kids Worldwide found that concussion injuries tended to be clustered in young adolescence.

An American child is treated for a sports-related concussion every three minutes, according to Safe Kids Worldwide, although many more go untreated.

12%

47%

The proportion of sports-related emergency room visits that involved a concussion

The proportion of children ages 12-15 who were treated in emergency rooms for sports-related concussions Source: Safe Kids Worldwide

53%

36%

Estimated percentage of high school athletes who have sustained a concussion

Estimated percentage of collegiate athletes who have a history of multiple concussions Source: Sports Concussion Institute

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UPFRONT

HEAD TO HEAD

Has the time come to insure the police?

Recent cases of police brutality have some wondering whether insurance can play a role in curbing unethical behavior

Robert Hartwig

President and economist Insurance Information Institute “Insurance can help protect taxpayers against the financial consequences of unethical behavior by law enforcement personnel, resulting in judgments against law enforcement agencies. The purchase of insurance alone, however, is unlikely to have a statistically discernible deterrent effect on unethical behavior.

Law enforcement agencies must incorporate efforts to reduce liability within a comprehensive risk management program, [and] insurance is just one element in such a program. Proper screening of prospective and current police personnel and continuous training are indispensable risk management tools necessary to reduce – and potentially eliminate – the likelihood of lawsuits.”

Michael W. Quinn

CEO International Ethics and Leadership Training Bureau “Everyone, it seems, is looking for ways to improve police accountability, [but] requiring officers to carry their own insurance is not the answer. If an agency is not going to indemnify them, it will likely be for an intentional act, outside the scope of their employment and likely outside the law.

Raise rates for problem officers?

Who makes that decision when many cities will settle nuisance suits just because it’s cheaper than litigation?

Insurance companies will never get the real story about what happened if it looks bad for the agency. Too many questions. Too much risk for any insurance company.”

Cole Yates

Campaign manager Committee for Professional Policing “In Minneapolis, we are placing the Police Insurance Amendment on the ballot this November. Professional liability insurance, at the individual level, provides strong incentives for officers to act within the scope of their employment.

Taxpayers would no longer bail out a small group of rogue officers again and again in court.

The vast majority of officers would not see any out-of-pocket costs; the city would pay the coverage base rate.

Insurers could price risk by looking at past lawsuit and complaint history.

Riskier officers would pay the difference between their individual premium and the base rate. The solution is accountability.”

MALPRACTICE INSURANCE FOR POLICE? It’s an out-of-the-box solution for municipalities smarting from payouts to cover officer misconduct: turning to the insurance industry to address risk rather than to taxpayer funds to foot the bill. The city of Minneapolis – which has picked up a tab of more than $20 million to settle police brutality cases – boasts not one, but two organizations pushing to require officers to take out professional liability insurance analogous to the malpractice insurance doctors must carry as a condition of employment.

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UPFRONT

OPINION

GOT AN OPINION THAT COUNTS? Email iba@keymedia.com

The changes are a-timing We know that the times are a-changing, writes Paul Edwards, but do we understand that change is all about timing?

I RECENTLY witnessed two examples converge regarding a problem we all face with age: letting times change. I listened with interest as one of my favorite talkradio hosts explained how Donald Trump is running rings around the Washington, DC, political circus, mainly with social media.

While I listened, I received word from a disappointed underwriter with whom I’d worked on a quote, which the client turned down because the carrier insisted on full payment upfront. It was a last-ditch email, saying. “We can make an exception!” But it was too late.

In summary: The aged political expectations of decorum and civility toward politicians and the press ring about as hollow as the rotary telephone to new American generations, as does a company with much greater resources insisting that people with limited resources pay top dollar – that’s a very efficient way of making sure you get outflanked by your competition.

It stopped me in my tracks. There’s a profound change among the current crop of elders – the very same generation that once told each other not to trust anyone over 30, and to whom Bob Dylan gave such voice with his folk anthem “The Times, They Are a-Changin’.”

The Baby Boomers are not the first American generation to insist on decorum in politics, nor are they the last that will demand unreasonable terms of payment for services they provide. They just happen to be the current dominant slew of retirees or near-retirees now drifting into old age with

little aside from senior citizen cliches to mutter – the very same cliches for which they once mocked their own forebears.

What does this mean in practical business terms? An example: Many Baby Boomers I know who are still running businesses have Facebook pages, Twitter feeds and YouTube channels for their companies. But they do next to nothing with them, except post ads

will lose many more donors and supporters before they figure out why Trump is taking them to the woodshed.

But here on the ground, we embrace building the new realm. I’m running as fast as I can in the direction where business flows, because I couldn’t care less if my clients approach me via Facebook or not.

And because this is about timing, I’m making myself ubiquitous in the collective mind of my market. I do make personal appearances at networking functions and lunches, but the rest of the time, I’m working my way into their consciousness by interacting with them where they are and when they are. The refusal to do so by so many elders in business – the resistance to the culture of millennials – is an about-face for the generation that told us not to trust anyone over 30.

The principle I’m following is no different than when Madison Avenue advertising firms recommended to clients that they advertise on TV, radio and in print,

“Resistance to the culture of millennials is an about-face for the generation that told us not to trust anyone over 30” that nobody reads and upload content no one finds interesting.

At its root, this approach indicates a recurring failure to deal with the reality that Facebook is the ‘meeting place’ of Generation X and millennials, and that they go there to socialize, not to shop. Confused Boomers mistake social networks for radio airtime or billboards.

For the marketing professional and business owner, this presents us with a challenge.

We know that the times are a-changing, but do we understand that change is about timing? Do we resist in the interest of a fading generation’s finger-pointing, or do we move toward it? And how soon do we make the decision? For sure, we do not want to spend years playing catch-up.

My insurance carrier will lose many more potential customers before they get the hint.

Similarly, the political parties in Washington

all at once, back in the 1960s. It’s the same idea: maximum saturation to produce maximum return.

But what do people say? “Oh, I don’t do that Facebook stuff; it’s so shallow and fake.”

I disagree. The real shallowness comes from people who refuse to learn, who put up a pathetic, minimal effort at reaching their marketplace because “it’s just not the way we did it back in my day.” They give up on it, citing their own failures as proof of what they suspected at the outset.

It’s not even close to being a valid excuse.

Paul Edwards is an independent property & casualty broker in Washington state. A military veteran and graduate of Pacific Lutheran University, he writes about marketing and business relationships.

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UPFRONT

NEWS ANALYSIS

London falling?

The decision by UK voters to exit European Union sets the stage for short-term economic strain on the US insurance industry, but could benefit the market in future IN 1688, a gathering of shippers and investors at Edward Lloyd’s coffeehouse in London laid the groundwork for what would become Lloyd’s of London – the most powerful player in the most powerful insurance market in the world. More than 325 years later, voters in the UK have seemingly threatened that business primacy by voting to exit the European Union.

The surprise decision in late June, popularly known as Brexit, raised questions for the global insurance industry and set the stage for some short-term economic strain on businesses in the US. The vote quickly sent shockwaves through global markets as the pound plunged to $1.35, its lowest level since 1985.

Yet despite that initial cratering, the stock market has quickly recovered. The S&P 500

in San Antonio. “For us, it’s probably going to be business as usual in the short run, and then we’ll figure out if this presents opportunities or not in the long term.”

That leaves US insurance firms with relatively minor logistical concerns like relocating offices. Enticed by the attractions of the London market and access to Europe, a rising number of companies have opened branches and moved major parts of their operations, even whole headquarters, from the US to the UK. As the UK loses the ability to passport services into Europe, a new base will be vital.

Both Aon and AIG have said they will consider establishing an operations center beyond the UK as a result of the vote. “In our world, risk is inevitable, and we manage

“It’s probably going to be business as usual in the short run, and then we’ll figure out if this presents opportunities or not” Mark Watson, Argo Group hit a new record high in mid-July, and investors are again deploying capital in seemingly risky assets. What’s more, thanks to the fallout from the global financial crisis, the US economy is now better insulated than most for the risk associated with market turmoil.

“It doesn’t have that much impact on us – the investment portfolio has held up very well,” says Mark Watson, CEO of Argo Group

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it accordingly,” said Aon CEO Greg Case in a statement. “But leaving the EU is an unnecessary gamble.”

Still, the US is not seeing “that much impact from Brexit in the mega sense,” says David Snyder, vice president of policy development and research for the Property Casualty Insurers Association of America.

Instead, Snyder sees an opportunity for US

insurance firms to solve problems caused by Solvency II, an EU regulatory regime that exercises risk-based capital requirements over companies doing business in the EU. Meant to protect insurance buyers, the rules manage capital, governance and reporting for insurers.

Yet Solvency II has deemed the US a “non-equivalent regulatory environment,” closing markets like Germany that have traditionally been open the US. Now that the UK – a prominent player in the drafting process of Solvency II – plans to exit the EU, there’s a chance to revisit effective regulatory regimes. Without commenting on whether this may dislodge the UK as the most prominent force in the market, Snyder says it “does offer the US an opportunity to show some leadership.”

“Now might be a very good point for major players in the US financial services industry to emphasize that international standards need to be flexible and that there are different, but equally effective, ways to deal with things,” he says. “This could be a chance to push through an approach of true

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THE GLOBAL HUB OF INSURANCE Complications with access to the common European market could threaten the leading position London has held in the industry for hundreds of years.

£15.86 billion

The London market’s gross annual premium income

£22.93 billion

London’s gross market premium, plus premium overseen by London operations

£48.22 billion

London’s total company market income, plus Lloyd’s of London’s gross written premium

52%

The share of income provided by the UK and Ireland for business written in London mutual recognition in place of the controversy created by Solvency II.” To accomplish that, regulatory groups like Congress and the National Association of Insurance Commissioners need to be on board. But there are “hopeful signs that that is occurring,” Snyder says, particularly with the June passage of the Transparent

US, it’s “unclear how big that window is.”

“There is some possibility that EU regulations will have less sway in the future, but at the end of the day, the US will adopt the regulatory environment that’s best for the US,” he says. “Whether or not the Brexit vote has a material effect on [Solvency II] is unclear at this point.”

“Now might be a very good point for major players to emphasize that international standards need to be flexible” David Snyder, Property Casualty Insurers Association of America Insurance Standards Act of 2015, reaffirming a national commitment to the state-based regulatory system.

Others in the industry are less enthusiastic about this ‘bright side’ of Brexit.

Economist and Insurance Information Institute president Robert Hartwig has said that while there is a window to push through regulatory standards more favorable to the

Other uncertainties relate to how exactly the UK will withdraw from the EU. Though there has been talk of a second vote that may reverse the original decision, Hartwig believes this is unlikely, and the UK’s new prime minister, Theresa May, has been adamant that “Brexit means Brexit.”

Under those terms, the UK must renegotiate hundreds of trade agreements and create

34%

The share of income provided by continental Europe Source: International Underwriting Association, 2014

an arrangement allowing it to remain a base for passporting throughout the EU. May has signaled this may take as long as six years, and until more concrete positions are taken by her government, US insurers are on standby.

“I think it’s really unclear how the UK is going to withdraw. It’s going to take time, and time is years, not quarters,” Watson says.

“Until someone in government steps us to tell us what this is going to look like, we don’t really know.”

Though there remains much to be seen in the wake of the Brexit vote, there is one company Hartwig believes will remain an institution to be reckoned with.

“I think Lloyd’s has positioned themselves so that the market remains the most important in the country and one of the most important in the world, irrespective of the EU vote,” he says.

“Lloyd’s of London will not become Lloyd’s of Dublin any time soon.”

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5/08/2016 4:16:22 AM

UPFRONT

INTELLIGENCE CORPORATE ACQUIRER

TARGET

PRODUCTS COMMENTS

Alliant Insurance Services

Mesirow Financial insurance division

Alliant’s acquisition of the insurance business contributes to the broker’s expansion in the Midwest

AssuredPartners

LJ Stein

The Florida-based firm has bought 150 insurance brokerages in the past five years

Digital Benefit Advisors

USBC

USBC works with international groups establishing businesses in the US

Great American Insurance Company

National Interstate Corporation

Great American will acquire the 49% of shares it does not already own in an all-cash transaction

HUB International

Parq Advisors

Justin Siegel and Ryan Stromsborg, co-managers at Parq, will join HUB California

Magellan Health

Armed Forces Services Corp.

Armed Forces Services provides behavioral health and specialty services to various agencies of the US government

USI Insurance Services

MVB Insurance

The West Virginia retail P&C and employee benefits brokerage firm will work under the USI brand

Abacus introduces drone insurance product

Buffett makes his next bid in medical liability insurance

National Indemnity Co., a subsidiary of Warren Buffett’s Berkshire Hathaway, is acquiring Medical Liability Mutual Insurance Co. of New York in a bid to expand its presence in medical professional lines. MLMIC is the largest underwriter of medical professional liability in New York, reporting $1.8 billion in policyholder surplus last year. In a news release, Buffett called the insurer “a gem of a company that has protected New York’s physicians, mid-level providers, hospitals and dentists like no other for over 40 years.” He added that the acquisition will help support MLMIC’s “capacity to serve these and other policyholders for many years to come.”

MLMIC president Robert Menotti said the deal will also allow MLMIC to expand, “with more customized policy limits, risk-sharing features and services to groups, facilities and other large accounts.” He also emphasized that Berkshire Hathaway is committed to keeping MLMIC’s culture, including its board and staff.

The deal, which comes as the insurer completes its conversion from a mutual company to a stock insurer, is expected to close in the third quarter of 2017. At that time, each owner of an eligible MLMIC policy will be entitled to receive a proportionate share of all of the cash consideration paid by National Indemnity Co.

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Los Angeles-based Abacus Insurance Brokers has enhanced its production programs to allow the schedule of unmanned aircraft, better known as drones. The drone enhancements are available for the short-term productions, production portfolio and DICE/annual production programs through A-rated admitted carriers.

Drone coverage is available through Abacus for all states except Hawaii. The company distributes its specialty insurance products through its own website.

MGU to offer new suite of cybersecurity products

Underwriting manager Victor O. Schinnerer & Company is collaborating with EMC and SaaS data protection company Spanning to create a line of exclusive and comprehensive cybersecurity protection solutions. The partnership, with support from Microsoft, is designed to provide small and midsized organizations with risk management and data protection solutions. The collaboration’s products and services include the Schinnerer Cyber Protection Package, Microsoft Office 365, Microsoft Enterprise Mobility Suite and Spanning Backup for Office 365.

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PEOPLE Insurer announces new food truck product

Farmers has launched its first official product for the developing food truck insurance marketplace. The new product combines commercial automobile coverage with a restaurant business owner’s policy.

Currently, food truck operators typically have to secure separate policies for their business needs and often end up purchasing from different insurers. The policy is now available in New Mexico and Utah, and Farmers hopes to expand its solution to multiple states.

AIG launches new cyber product

AIG has assembled its risk mitigation offerings cyber insurance and partnerships to launch a new product, CyberEdge Plus. The standalone policy is designed to give clients primary insurance protection for a variety of cyber risks, including business interruption, bodily injury, product liability and property damage. As part of the product, AIG offers risk mitigation consultation through a number of cyber specialists that can give independent analysis of clients’ cyber-related exposures and related coverage.

Ironshore adds third-party product recall endorsement

Ironshore Specialty Casualty recently added a third-party recall cost endorsement to its primary general liability coverage form for commercial clients. The endorsement compensates the insured for costs incurred as a direct result of a recall for up to 12 months after the recall. The policy’s coverage applies on a first-dollar basis and has a separate limit of $50,000 per policy. Ironshore also offers reimbursement for related expenses, such as cancellation of advertising, retail shelf slotting fees, and communications and media notifications.

NAME

LEAVING

JOINING

NEW POSITION

Laurie Banez

Argo Group International Holdings

Sompo Canopius AG

Head of US financial and professional lines

Scott R. Barraclough

N/A

W.R. Berkley Corporation

President, Admiral Insurance

Matthew Begnaud

Global Special Risks

Worldwide Facilities

Senior vice president and broker

Andrew Carr

Integro Insurance Brokers

Lockton Companies

Commercial insurance team leader, Atlanta

D. Scott Clarke

N/A

Oak Street Funding

Chief operating officer

Alan Dudkiewicz

Jimcor Agency

XS Brokers Insurance Agency

Vice president and manager, Philadelphia/New Jersey operations

George D. Dufala Jr.

Erie Insurance Group

Kemper Corp.

President of property & casualty division

Mark Engel

AIG

ProSight Specialty Insurance

Marine and offshore energy program executive

Dorian Grey

AIG

Starr Companies

President, Latin American division

Christine Harman

AIG

Swiss Re Corporate Solutions

Senior vice president and head of casualty, US Central region

Brian Kilroy

Zurich North America

Philadelphia Insurance Companies

National vice president of marketing

Bob McAuley

RT Specialty

Worldwide Facilities

Regional president

Sean McPhillips

N/A

Aspen Insurance Holdings

Senior vice president and head of US primary casualty

David A. Nurre

N/A

USI Insurance Services

President of employee benefits

Kemp Ross

Aon Hewitt

Willis Towers Watson

Global head of delegated investment solutions

Worldwide Facilities taps international talent to lead Dallas office

Matt Donovan, the new assistant vice president at Worldwide Facilities, is a longtime insurance veteran and active player in the cybersecurity and data risk space – and he’s eager to bring that experience to the table as he gets ready to lead the office’s efforts to build its executive/ professional lines. Donovan comes to the role from Hiscox, where he rose through the ranks to become vice president and global practice leader for cyber and data risks, helping to lead the development of cyber products for the EU.

Allianz names new head of terrorism and political violence for North America

Allianz’s newest senior underwriter for terrorism is looking to bring his London training and expertise to North America.

UK native Adam Posner joined Allianz Global Corporate & Specialty from XL Catlin, where he was a terrorism underwriter, managing broker relations and serving as the point of contact for global terrorism inquiries. Now, he will serve in a similar role for Allianz’s North American markets. “For me, building relationships with brokers is going to be key as Allianz positions itself to become a larger presence in the stand-alone terror market,” Posner said.

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5/08/2016 4:16:55 AM

UPFRONT

WORKERS’ COMP UPDATE NEWS BRIEFS Florida’s comp rates could increase by 20% The National Council on Compensation Insurance [NCCI] filed a July request to increase Florida’s workers’ comp insurance rates by 19.6%. If approved by the state the Office of Insurance Regulation, the rate hike will go into effect October 1. The increase is a response to two recent state Supreme Court decisions, one of which removed a statutory cap on attorney fees for claimants, and another that struck down a law that allowed the city of St. Petersburg to cut off an injured firefighter’s temporary disability benefits after two years.

Underwriters benefit from predictive analytics

Predictive analytics is yielding positive results for underwriters on the property & casualty front, but some issues continue to hinder its efficient use for maximum benefit, according to a new survey. P&C data analytics and modeling firm Valen Analytics said that 65% of the 115 respondents indicated they used predictive analytics in underwriting this year, a 9% increase from last year. Of those surveyed, 83% said they used the tools for better risk assessment, 82% said they need it for accurate pricing, and 73% cited the benefit of protection from adverse selection.

NCCI launches enhanced insight tool The National Council on Compensation Insurance [NCCI] has released an enhanced version of its State Insight Tool, which is available to both regulators and carriers. New enhancements include an interactive map that allows key data

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comparison across states, including direct written premium and average weekly wage; the ability for users to view top class codes for each state; and a data visualization tool that allows comparison among state, regional and countrywide data for pricing, as well as premium and loss data.

Workers’ comp case welcomes amicus curiae briefs

The submission of amicus curiae briefs has been permitted in the ongoing Oklahoma comp case of Jonnie Yvonne Vasquez, who was denied benefits for an existing spine injury while working at a Dillard’s store in Shawnee, Oklahoma.

The retailer asserted that its opt-out plan did not cover for pre-existing injuries and appealed in March to the Oklahoma Supreme Court. In early June, the company filed an objection to applications by industry and/or interest groups looking to submit amicus curiae briefs on behalf of Vasquez. However, Oklahoma Supreme Court Chief Justice John F. Reif has ruled that the court will accept the briefs.

Top insurer loses legal fight against former NHL players

A federal judge has ruled Chubb must provide former National Hockey League players with redacted copies of medical exams related to workers’ compensation claims for head trauma. More than 100 former hockey players have sued the NHL, claiming the organization didn’t do enough to protect players from concussions. Chubb claimed that providing the subpoenaed information would violate players’ privacy rights and place “a significant economic burden” on the company itself. But US District Judge Susan Nelson disagreed, ruling that the players are entitled to redacted versions of the medical exams.

Good times ahead for workers’ comp?

A recent report reveals an upswing for the sector, but the turnaround may be short-lived Last year brought profits for property & casualty insurers’ workers’ compensation lines, but the good times may be short-lived.

Ratings agency Fitch reported last month that US workers’ comp carriers saw increased underwriting performance in 2015, following years of losses. That turnaround is due to premium rate increases, stable loss cost trends and improved loss reserve experience, analysts said.

“Calendar-year 2015 represents the culmination of a complete turnaround for the workers’ compensation line,” Fitch said in the report. Apart from a brief recession-era spike, the line’s claims generally trended downward thanks to “the evolution of better risk management and employee safety practices.”

Greater reserves have also boosted underwriting profit, particularly in 2015, when reserves helped decrease the industry’s loss ratio by more than five percentage points.

The segment underwriting combined ratio dropped from a recent cyclical high of 117% in 2011 to 95% in 2015. Premium revenue growth averaged more than 5% for the last three years and was 3.5% in 2015.

Carriers shouldn’t get too comfortable, however. Hotter competition in the sector means an underwriting loss is expected to return by 2017.

“The workers’ comp insurance market saw a sharp turnaround in the last few years

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5/08/2016 4:20:26 AM

Q&A

... however, this performance will likely be unsustainable as price competition intensifies, due in part to abundant market capacity,” said Jim Auden, managing director for Fitch.

Workers’ comp is the largest individual product segment by premium volume in the commercial lines market, and an important business line for a growing number of underwriters. As new players enter the space, market share has shifted significantly in recent years.

Berkshire Hathaway and AmTrust are among the insurers that have seen rapid

Years in the industry 25

“This performance will likely be unsustainable as price competition intensifies”

Fast fact Miller recently celebrated her 13th year with Mid Atlantic, where she oversees the Sole Proprietor Solutions program

growth in the workers’ comp sector, while AIG and Liberty Mutual, along with others, have cut premiums in response to past losses.

Travelers Companies remains the top workers’ comp writer in the country in terms of direct written premium. The carrier claimed nearly $4.47 billion last year, for an 8.2% market share. Net written premiums reached nearly $3.96 billion, representing an 8.7% market share.

“As the market landscape shifts, there have been a number of companies that have demonstrated extraordinary growth,” Auden said. “However, Fitch considers rapid growth that is well in excess of the market’s growth rate to add considerable risk to an insurer’s underwriting profile.”

Tina Miller Executive director MID ATLANTIC INSURANCE SERVICES

How agents can help control comp costs How much can agents help control workers’ compensation costs to make a difference on a client’s bottom line?

The difference they can make is to really know the account and have good conversations with insureds so that they understand the exposures, make sure they are classified correctly and have a really good understanding of the insured’s operation.

You also need to make sure employees are classified correctly.

We have been asked to rate a particular piece of business based on an incorrect classification, and at the end of the year, they may be audited. I would remind agents that at any time, they can call the NCCI and give a description of operations in order to receive the best class code.

How important is carrier selection in controlling costs?

Partnering with a wholesaler is one of the top advantages a registered agent may have, as they have three, four, five carriers to consult. In our company, we have 30 markets we can go to. We also have sizable books that give us a little more pull with an underwriter or an edge to get our business worked on.

Of course, shopping around will ensure clients get the best rate.

You have to determine which carriers are even going to be interested in the classification. Again, that’s where a wholesaler can help.

You feel sole proprietors represent a growing opportunity for agents to expand their business. What factors are at play in this trend?

Sole proprietorship is gaining more momentum. Economically, things are looking up – there is a lot of building, a lot of people going into business for themselves. More and more home-based companies, including specialized trades like plumbers and electricians, are really trending.

These companies have no employees, but the proprietor needs to show proof of insurance to secure a job. We’re not charging an astronomical amount for that coverage, as opposed to payrollbased policies that charge, say, $49,000 regardless of what the usual payroll is. In reality, it could be $3,000. The proprietor can’t afford that, and he doesn’t want to.

Do you have any advice for agents who are looking to expand their workers’ comp client base?

I do recommend seeking a wholesaler. There is a better opportunity to find the right carrier for their insured, either as a cost-saving implement or based on exposure to get help with loss control and reduce claims. Either way, we understand opportunities and programs agencies can pass on to clients to improve workplace safety.

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5/08/2016 4:20:31 AM

UPFRONT

TECHNOLOGY UPDATE

Consumers prefer online insurers A new poll suggests brand equity has never been lower, but online channels are gaining momentum

many (20%) see it as “on the way down.”

What’s more, as Gen X and millennial consumers age and their insurance needs become more complex, Sinopoli feels there may be a shift that favors more involved interaction with an agent. “Those years are a very active time of your life filled with huge triggers like buying a home, having a family or starting a business,” she says. “That’s the perfect time for an agent to reach out and engage.”

Laird Rixford, president of software company Insurance Technologies Corporation,

“Making it easy to do business with you, whatever the customer’s preferred method – that’s the key”

According to a recently released analysis from the Harris Poll, brand equity among US insurance companies is on the decline in comparison with other businesses in the financial services sector, although the online insurance channel is showing the strongest positive momentum among American consumers. Twenty-two percent of survey respondents expressed favorability toward online channels and confidence that the sales method would increase in popularity in the future.

NEWS BRIEFS

“We’re seeing anything tech-based having more positive momentum,” says Joan Sinopoli, vice president of brand solutions at Nielsen, which owns the Harris Poll. “It’s pervasive across all industries, and you don’t need much of a crystal ball to see that brand equity among online channels is going to increase.”

Yet this growth doesn’t mean an automatic loss for the traditional agent/broker model.

The Harris Poll report noted that while many consumers prefer the online channel, just as

Insurance tech company integrates with Compare.com

The integration of Texasbased Insurance Technologies Corporation [ITC] and Compare.com will boost the performance of both carriers and independent agents, representatives with both companies say. Compare.com works with 90 insurance brands to deliver auto insurance quote comparison to customers through ITC’s comparative rating services.

Once users are given personalized quotes, they can lock in the policy of their choice directly with the carrier online, over the phone or through an agent.

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also sees the millennial generation as a tremendous opportunity for agents. Rixford notes that the Harris Poll’s research suggests millennials are among the most disengaged with insurance brands. If agents can connect with the generation in a way traditional insurers have not managed, they will secure themselves a seat at the table for many years to come.

“If you look at companies that do enjoy brand loyalty – like Amazon or Netflix – you see that they make their product easy to use,” he says. “That’s where a lot of carriers are missing the boat. Making it easy to do business with you, whatever the customer’s preferred method – that’s the key.”

One-third of companies have cyber coverage

According to a recent study from security firm Mimecast, only about 35% of businesses carry cyber insurance. Perhaps even more troubling, only 10% of companies with cyber coverage believe their insurance would cover emerging social engineering attacks. Steve Malone, director of security product management for Mimecast, said attacks from those posing as an company executive, asking for the receipt of files, are becoming more common and insidious.

Today, perpetrators are likely to ask for employee W2 forms or other valuable data.

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5/08/2016 4:21:03 AM

Q&A

Joan Sinopoli Vice president of brand solutions NIELSEN

Career highlight Winning the David Ogilvy Award for effective research in helping brands while working with Subaru

The agent’s role in a digital world Your research with the Harris Poll reveals that insurance companies fall near the bottom of the financial services industry when it comes to brand equity. What’s happening here?

Certainly things like the economy, the recession and the mortgage crisis influenced the financial services category overall, but it’s not just an issue of whether or not there’s a financial crisis. People just don’t interact with financial brands all that often, and with insurance in particular. Something we do know is that when a bond is formed with an insurance company, it tends to be formed through the agent or advisor involved. When the agent leaves a company, sometimes their customers go as well. In insurance, we’re seeing companies with particularly strong agent networks perform the best in terms of brand equity.

So agent connection is key – but online insurance channels are showing the greatest positive momentum, according to the poll. How do you square that?

What we believe is that even when you have a strong agent network, you need to create a seamless experience between the agent and the online channel. Be strong and be ready for customers to reach you when and where they want – that’s going to be really important.

This is particularly true for millennials, who are really engaging in what we call ‘showrooming’ behavior. This means you shop online and compare prices, but in the end, you make a purchase in person. Millennials are gravi-

Pokemon Go craze opens up real world of liability

While the Pokemon Go app has experienced wild success getting users to move in the real world, it also opens up questions regarding liability. “Consumers use apps in ways that one cannot always predict and thus claims are brought that insureds cannot always predict,” said Charlie Murray, technology underwriter at CFC Technology.

“Therefore, app developers should be seeking a broad E&O wording, covering exposures such as user generated content, bodily injury, property damage, breach of contract and civil liability.”

tating toward price comparison as an indicator of value, but in the end they are still buying from agents.

At the same time, some 20% of consumers say they see the online channel as “on the way down.”

Is this another generational difference?

I think so. What we’re seeing is that the shift toward the online channel in terms of favorability begins with Generation X and really accelerates with millennials.

Millennials tend to love brands, and they tend to give insurance companies higher brand equity ratings than other generations.

What do you feel the future holds for insurance channels, given these conflicting preferences and trends?

What is interesting is two things: One, we are beginning to see a shift toward mobile in terms of using the mobile channel to conduct various types of interactions. It’s not a dramatic percentage, but we’re seeing between 5% and 7% of millennials having financial interactions using mobile devices.

The second thing is that we’re looking ahead to Generation Z. Millennials are sort of digital natives, but Gen Z really have no bounds with different screen interfaces and digital engagement.

What we advise clients in this industry to do, then, is to be active among all channels and, again, create that seamless experience between them so that customers can engage with you in multiple ways.

Zenefits launches cloud app to dispel scandal

As part of its efforts to recover from allegations of fraud, Zenefits has launched a cloud-based application that will ensure only licensed agents can sell insurance products. The app, which Zenefits has been using it internally since February, works by automatically verifying a broker or advisor’s licensing status and prevents their assignment to an account if they do not have a valid insurance license. The app receives a feed from the National Insurance Producer Registry producer database to ensure it is always up to date.

Insurer uses aerial technology for home inspection

Encompass Insurance has recently started using an EagleView Technologies product to help assess homes when issuing or renewing homeowner’s policies. EagleView is a Seattle-based company that provides aerial images and analysis to Encompass, allowing them to appraise each home with more speed and accuracy. EagleView delivers in-depth data regarding home square footage, roof type and detailed diagrams of the home, replacing the use of a property inspector.

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5/08/2016 4:21:09 AM

PEOPLE

INDUSTRY ICON

MATCH OF THE TITANS Chubb executive vice president Paul Krump discusses the revamped company’s efforts to bring the best of two businesses together IT WAS the largest deal ever seen in the insurance industry and resulted in the creation of the world’s largest publicly traded property & casualty insurer.

In January, ACE Limited announced it had completed its acquisition of The Chubb Corporation, a transaction worth approximately $29.5 billion; the combined entity adopted the Chubb name. In the new leadership team, Paul Krump, formerly COO of Chubb Corporation, became executive vice president of the new Chubb Group and president of North America commercial and personal lines.

Krump says that since the completion of the transaction, a “breathtaking” amount of progress has been made in integrating the two companies.

“We did an enormous amount of work pre-close. We did a tremendous amount of planning so we could hit the ground running and not be too inwardly focused at close,” he says. “We were in the market on day one after closing, bringing out new capabilities such as cross-selling and upselling of each other’s products, making certain of the strengths of the combined firms – for example, the different market segment expertise and the expanded geographic footprints. We brought all that to customers and agents.

“I’d say that our work to synchronize hundreds and hundreds of processes, procedures, and systems continues, but we are methodically tackling those issues every day.”

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Back to the beginning Krump began his insurance career with Chubb in 1982 as a commercial underwriting trainee.

He’s since held many positions within the company in both the US and Europe.

Looking back over his years with Chubb pre-integration, Krump says it’s difficult to identify a standout moment.

“There was a good number of successes and disappointments,” he says. “There were new products and ventures … new offices and

As for the most challenging times during his three-decade-long career at Chubb, Krump says two instances quickly come to mind.

“Early in my career, I was sent to Germany to help turn around a failing operation,” he says. “It took the team several years and lots of experimentation and changes, but we truly reimagined our role as a market in the country, and then altered our course dramatically. We went from being what I would call a ‘me too’ carrier, with mediocre results, to one that was

“We were in the market on day one after closing, bringing out new capabilities such as cross-selling and upselling of each other’s products, making certain of the strengths of the combined firms” new market segments. Some of these were absolute home runs and some of them were, frankly, duds.

“I think what stands out for me is putting the good of the firm above my own personal interests, persevering through the challenges when others gave up, and simply being fair and decent to employees, customers, claimants, and agents and brokers. It’s been incredibly rewarding … I take tremendous pride in having helped build a wonderful company with an outstanding reputation for integrity.”

innovative and bringing cutting-edge new products to the market and earning an underwriting profit.”

Krump also mentions the task of leading Chubb out of the soft market of the ’90s.

“I believe that effort took a lot of courage and deftness,” he says. “We had to overhaul our underwriting and pricing, we had to do it largely with a generation of people who had only experienced the soft market, and we had to do it with urgency and optimism. And it took real leadership.”

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5/08/2016 4:21:41 AM

PROFILE Name: Paul J. Krump Company: Chubb Group Title: Executive vice president and president of North America commercial and personal insurance Years in the industry: 34 Fast fact: Krump also serves on the executive committee of the Council of Insurance Company Executives and the board of trustees of St. Johnâ&#x20AC;&#x2122;s University

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5/08/2016 4:21:48 AM

PEOPLE

INDUSTRY ICON

The new Chubb So what can brokers and customers expect from the new Chubb?

“We now have a much larger suite of products, deeper expertise and more specialists by industry type and by product – all of this wrapped in a larger balance sheet and a rich tradition of long-term and very local relationships,” Krump says. “Just in North America, legacy Chubb adds 40 new branch locations and thousands and thousands of customers, and hundreds and hundreds more agent relationships to the combined company.”

offerings and pricing at a much more granular level, and it’s really going to enhance our ability to compete.”

Talking technology, Krump says there’s no doubt the pace of change requires the company to think about how it relates to customers.

“We are making significant investment in our digital strategy and capabilities to enhance the claims process, with our goal to be a userfriendly and flexible carrier without diminishing, in any way, the high touch, exceptional service that customers have come to expect from the Chubb service brand,” he says.

“Web applications, mobile apps that estimate auto damage, drones for estimating property damage and even robotics that will speed processing are all examples of technology that is changing the way we conduct business” Krump also touches on the strengths of each company and how they complement each other.

“When I think of legacy ACE, they bring deep expertise and products such as cyber, aviation, environmental, healthcare, and accident & health, and they’re really well regarded and renowned for large global accounts,” he says. “Legacy Chubb brings renowned industry expertise in such segments as life science and technology, [and] clean energy.”

In addition, he points to the 2015 sale of Fireman’s Fund’s high-net-worth portfolio to ACE as another considerable asset. “On the personal lines side, we now have the data and customer insights on the high-net-worth customer from three of the leading writers in that space,” Krump says. “All three of them are being combined, and we believe it’s going to allow us to tailor our services and our product

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Krump adds that combining a best-inclass claims experience means adapting to customers’ diverse preferences. “This includes leveraging digital capabilities, which we have in place and continue to expand globally,” he says. “Many customers want information instantly, at any time of the day and without making a phone call. Web applications, mobile apps that estimate auto damage, drones for estimating property damage and even robotics that will speed processing are all examples of technology that is and will be changing the way we conduct business.”

It’s perhaps an understatement to say that Krump is enthusiastic about the possibilities that the combined ACE and Chubb will offer. “I think we’re creating something more powerful and more exciting and enduring together than we would have ever done as separate companies.”

CHUBB BY THE NUMBERS

54

The number of countries and territories in which Chubb has local operations

31,000

The approximate number of Chubb employees worldwide today

$29.5 billion

The approximate value of the ACE/Chubb acquisition transaction

$37 billion

The approximate value of Chubb’s annual gross written premium

$150 billion

The approximate value of Chubb’s assets

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5/08/2016 4:21:59 AM

US/CAN AD LED TEMPLATE NO AD

FEATURES

COVER STORY: YOUNG GUNS

YOUNG GUNS These 61 young professionals are energizing and revitalizing the entire insurance industry

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OVER THE last few years, it’s been widely reported that the average age of the American insurance professional is 59 years old. More than ever before, the insurance industry is focused on recruiting fresh talent. While that task can seem insurmountable at times, this year’s crop of Young Guns proves it’s anything but.

To compile our annual report, we asked you, our readers, for your nominations and also reached out to the top American insurance companies and brokerages to uncover the following selection

NAME

PAGE

of 61 impressive young men and women who have already had a significant impact in just their first few years in the industry.

Despite being 35 and younger, these individuals are emerging leaders in their companies and are quickly rising into influential roles. Whether they’re producers, underwriters or CEOs, their contributions and efforts are inspiring peers and mentors alike – and paving the way for a bright future for the next generation of insurance professionals.

COMPANY

NAME

Adams, Lydia

30

Concorde General Agency

Kidd, Matthew

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COMPANY

Alfonso, Rick Borisoff, Devon Bouchard, Alyssa Cecchini, Jeff Chisenhall, John Crabtree, Dakota Crater, Geoffrey DeMent, Diana

41 40 43 35 39 32 39 43

Kotrla, Justin

34

Southwest Risk

Learned-Fenty, Victoria

36

Burns & Wilcox

Long, Wilson

24

EPIC Insurance Brokers

Martin, Cameron

26

Hauser Insurance Group

McEachern, Blake

27

McLain, Logan

32

Meyer, Matt

29

Acentria Insurance The Hartford Steam Boiler Inspection and Insurance Co. Risk Placement Services, Inc.

Mitchell, Mike

34

Montgomery, Will

42

Great Lakes General Agency

Dinkelmann, Vincent

41

Dwyer, Emily

41

Willis Towers Watson Monarch E&S Insurance Services AAMGA Montgomery & Graham, Inc. Patriot National, Inc. The Thompson Group Hanover Excess & Surplus, Inc. Century Insurance Group W.A. Schickedanz Agency, Inc./Interstate Risk Placement, Inc. Cook Maran & Associates

Eberson, Zachary Ekberg, Reid Enders, Andrew Friedman, Cory

43 25 30 24

McMahon Insurance Agency Pilkey-Hopping & Ekberg, Inc. Enders Insurance Associates GCG Financial, Inc.

Morris, Ryan

31

Risk Placement Services, Inc. Montgomery & Associates Insurance and Financial Services Navigators Management Company

Murphy, Blake

27

Deland, Gibson Insurance

Netterfield, Erik

28

Hudson Insurance Group

Peterson, Chris

34

Chris-Leef General Agency, Inc.

Fylak, Topher

38

Nationwide E&S/Specialty

Poucher, John

42

Abram Interstate Insurance Services

Gallagher, Mike

26

Risk Placement Services, Inc.

Powers, Austin

28

The Hanover Insurance Group, Inc.

Gaylor III, Greg

32

Gaylor Insurance

Pytel Jr., Thomas

31

Nautilus Insurance Group

Gibney, Ryan Giles-Harris, Colleen Gillespie, Megan

24 40 33

Lockton Companies, LLC Risk Placement Services, Inc. Genesee General of Colorado

Raburn, Chris

40

Genesee General

Sarnoski, David

25

Vela Insurance Services

Githens, Jonathan

26

Lockton Companies, LLC

Graham, Nick

36

Nautilus Insurance Group

Soden Jr., Hal Speck, Alison

35 40

Oliver L.E. Soden Agency MVP Agency, Inc.

Guerrieri, Alyssa

38

Nautilus Insurance Group

Stachmus, Adriane

34

One General Agency

Harner, Joe

43

Aegis General Insurance Agency

Talebzadeh, Zohreh

39

EPIC Insurance Brokers

Herring, Melanie

42

Nautilus Insurance Group

Temple, Crystal

27

Robinson & Stith Insurance

Higgins, James

35

CRC Insurance Services, Inc.

Turner, Cody

25

Burns & Wilcox

Hutchinson, Lucas

30

Hull & Company, Inc.

Tveidt, Michael

26

Fischer Rounds & Associates

Johnson Jr., Francis

38

Johnson & Johnson, Inc.

Jolley, Nicole

28

GuideOne Insurance

Von Haden, Ryan

27

TRICOR Insurance

Kaufman, Daniel

37

H.W. Kaufman Financial Group/Burns & Wilcox

Wade, Danielle

42

Kessel, Jennifer

31

USG Insurance Services, Inc.

Ziembiec, Adam

28

Jackson Sumner & Associates The Hartford Steam Boiler Inspection and Insurance Co.

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5/08/2016 4:58:58 AM

FEATURES

COVER STORY: YOUNG GUNS CORY FRIEDMAN Senior associate GCG FINANCIAL, INC. Age: 27

For Cory Friedman, going into insurance was about helping others see the light.

Starting out as an intern at GCG, he saw how the company’s advisors helped simplify the complexities of insurance for their clients.

“I knew right away that I wanted to be that person, educating and supporting my clients’ employees,” he says. And it’s

WILSON LONG

RYAN GIBNEY

Principal

Vice president and DC cyber technology practice leader

EPIC INSURANCE BROKERS Age: 33

The ever-evolving nature of insurance is what drew Wilson Long into the industry, as it not only requires constant learning but also encourages a “consultative” interaction between business owners and executives.

Long has made significant leaps in his career over the last five years, evolving from a national account producer to a vice president, senior VP and now principal. He received his company’s top consultant award two years in a row after posting revenue growth of more than $250,000 and then $450,000. A speaker and writer for construction business-related concerns, Long will be a participant in the upcoming 2016 Andrew Beazley Broker Academy at Lloyd’s. He says it’s important to “push yourself outside your comfort zone” and to “celebrate your successes no matter the magnitude” – a good balancing act for any young professional.

Outside of his work at EPIC, Long is an Eagle Scout, a junior board member for The Club and a previous board member for the Rotaract Club of Birmingham, in addition to participating in projects for United Way of America, Boy Scouts of America and JDRF.

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not just any clients, but specifically his millennial peers, who he realized needed to see insurance in a different light.

Beyond hitting numbers and receiving the company’s Circle of Excellence Award, what Friedman finds motivating is getting to work with big companies with multiple offices/sites, as this challenges his team’s creativity and technological savvy. He advises young professionals who wish to enter the industry to be patient and persistent and, as he did, find a partner or mentor who will help them grow their skills and business.

LOCKTON COMPANIES, LLC Age: 28

It’s no coincidence that Ryan Gibney chose a career in insurance – his parents met while working at an insurance company, and both enjoyed long careers in the industry. Gibney now leads the cyber technology practice at the Washington DC Series of Lockton Companies, which, under Gibney’s leadership, has driven more than $1.5 million in new and organic business in just the past 18 months.

His vast experience in complex insurance programs has also allowed him to become a frequent speaker at industry events and participate as a global resource for Lockton in communicating with clients on cyber issues.

An avid sports fan, Gibney’s interests spread nationally and across the Atlantic as he supports his favorite teams: the Chicago Cubs, New York Rangers, Dallas Cowboys and Manchester United.

REID EKBERG President PILKEY-HOPPING & EKBERG, INC. Age: 35

CODY TURNER Associate managing director BURNS & WILCOX Age: 30

DAVID SARNOSKI Executive risk specialist and team lead, Western professional liability VELA INSURANCE SERVICES Age: 33

The sky’s the limit for David Sarnoski, an avid rock climber and team lead for Western professional liability at Vela Insurance Services. After leaving the construction business for insurance, Sarnoski joined Vela in 2012, and last year was promoted to lead the company’s team in the West, which has experienced organic growth over the last three years in the complex miscellaneous professional liability market.

What attracted Cody Turner to the insurance industry was simply Burns & Wilcox’s dedication to developing young talent. “As I discovered more about the leadership training opportunities within the organization and the amount of time and resources they devoted to developing young talent, I knew it would be a good fit,” he says.

A graduate of the Kaufman Emerging Leaders Program, Turner finished each of his first two years with more than 40% growth and has played a key role in Burns & Wilcox Fresno’s 43% overall growth since he joined the office in 2012. In 2014, he was promoted to associate managing director, and just last year, he completed the Kaufman Advanced Management Program. He’s also the treasurer and a board member of the Independent Insurance Agents and Brokers of Tulare/ Kings County.

They say relationships are key in insurance, but for Reid Ekberg, that doesn’t end with his client relationships.

“I saw firsthand from my father the flexibility and quality of life a career in the insurance industry could offer,” Ekberg says. “He was there to coach all my little league teams, and I want to be there for my kids.”

After working as a claims examiner and an English teacher, Ekberg joined the company in 2008, and was appointed president last year. Since he took on the role, the company has grown by 11%, and has maintained an average yearly growth of 5% for the past eight years. Ekberg was also named the Young Agent of the Year by Independent Insurance Agents Brokers of Washington State in 2014, and now serves as chair for the organization’s Young Agents Committee.

He cautions his fellow young professionals that although technology leads to innovation, they should not let that replace foundational communication and sales skills.

Best advice for other young professionals “Use your youth and passion to your advantage. Your clients, peers and mentors want to speak with young professionals who possess excitement and enthusiasm. Don’t hold back when it comes to sharing your goals and hunger for success – leverage it.”

www.ibamag.com

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FEATURES

COVER STORY: YOUNG GUNS CAMERON MARTIN

MICHAEL TVEIDT

Executive vice president

Commercial insurance agent

HAUSER INSURANCE GROUP Age: 35

Although Cameron Martin did not attend the risk management and insurance program at his university, he did begin his insurance career right out of college after being recruited by Marsh. Now with Hauser, Martin serves as the management liability practice leader and has increased the company’s total annual revenue to an excess of 85%. The youngest member of Hauser’s executive committee, Martin was recently promoted to EVP in May; in that role, he’s now responsible for growing three segments of the business – P&C, employee benefits and retirement services.

Best advice for other young professionals “Keep your eyes and ears open.

Learn as much as possible.

Build lasting relationships in the industry. You will be amazed at how you’ll continue to cross paths and work with people you met at the beginning of your career.”

FISCHER ROUNDS & ASSOCIATES Age: 28

Starting out as an intern for one of the biggest insurers in the country led Michael Tveidt to realize that the industry offered many opportunities for young agents. After reaching out to Fischer Rounds & Associates, a prominent insurance company from his hometown, Tveidt landed a position in their Sioux Falls office. There, he has moved from personal to commercial lines and has been enjoying his work with larger companies as he gets to know more about the industry.

His affinity for his community of Sioux Falls shows in his involvements outside work – being part of Young Agents Committee, Young Professionals Network, church, and spending time with his wife and their Rhodesian Ridgeback. At 6’7”, Tveidt is a former basketball player with North Dakota State University and played professionally in Germany, Spain and with the Iowa Energy and now spends time working with youth as a basketball coach.

MIKE GALLAGHER Commercial lines underwriter RISK PLACEMENT SERVICES, INC. Age: 25

Insurance was not Mike Gallagher’s first career choice, but it eventually proved to be a good alternative. He was promoted to new business underwriter in 2015; now in his second year of producing, he hopes to reach $200,000 in new business revenue to realize 200% growth.

Gallagher also keeps himself busy with organizations such as AAMGA, AIM UP and Young Risk Professionals. He is an avid Chicago sports fan of the Cubs, Blackhawks, Bears and Bulls, and enjoys playing golf in his spare time.

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www.ibamag.com

JONATHAN GITHENS Vice president and account executive LOCKTON COMPANIES, LLC Age: 28

Looking to trade Midwest winters for a warmer climate, Jonathan Githens accepted a position with Lockton in Dallas and has remained in the insurance industry since. Recently, Githens was promoted to vice president at Lockton, the world’s largest privately held insurance brokerage. Apart from his regular work of developing relationships with clients and advising them on insurance needs, Githens also takes time to advise those new to the industry; he previously participated in the Dallas-Fort Worth Chapter Risk Management Society’s conference as a panel speaker about career development in insurance. He advises other young professionals that “networking is a vital part of the business” and suggests they meet more people by joining the various organizations in the industry.

BLAKE MCEACHERN Vice president ACENTRIA INSURANCE Age: 26

Blake McEachern chose to follow in the footsteps of his father, who has worked in the insurance industry for more than 35 years. He started out as an intern while finishing his undergraduate degree, and became a producer after he graduated. Two years later, McEachern had grown his book of business to $200,000 in revenue and more than $2 million in premiums, which led to his promotion to vice president. He is now working in the multi-family arena and looking toward his next goal of reaching $500,000 in revenue by the end of this year. Apart from looking after his clients, McEachern also spends time helping children, working with charities such as the Emerald Coast Autism Center, the Children’s Volunteer Health Network and the Special Olympics.

RYAN VON HADEN

CRYSTAL M. TEMPLE

Partner and VP of business accounts

Accounting manager

TRICOR INSURANCE Age: 35

ROBINSON & STITH INSURANCE Age: 31

One of IBA’s Top Producers for 2016, Ryan Von Haden has had a great year so far. He became a partner at TRICOR at age 33, and has written more than $2 million in premium in just the past year and a half.

He also has earned his Certified Insurance Counselor and Associated Insurance Services designations.

Von Haden believes he was destined to be part of the insurance industry – his family has been in the business since 1953.

He says insurance is also the best way for him to learn about different businesses and meet different kinds of people.

Outside of work, Von Haden is a committee member for the Young Professionals Club of the Professional Insurance Agents of Wisconsin, and spends his free time outdoors with his family, playing golf, hunting, fishing and coaching Sauk Prairie youth baseball.

BLAKE MURPHY Vice president and risk advisor DELAND, GIBSON INSURANCE ASSOCIATES Age: 35

A career in insurance is a win-win for Blake Murphy, as it allows him to work on areas he’s passionate about and help people at the same time. He has been with Deland, Gibson Insurance Associates for five years, and during the first half of 2016, he has already produced more than $103,000 in new business revenue.

Passionate about all things marine in and out of the office, Murphy spends his free time saltwater fishing and boating; he’s also an active member of two marine trade associations and a sport fishing community, and holds a 100-ton US Coast Guard Captain’s license.

An accounting professional, Crystal Temple revolutionized Robinson & Stith Insurance by spearheading the company’s social media presence and transitioning the entire accounting department to a paperless environment. Additionally, Temple has orchestrated her company’s involvement with various local projects and organizations. One of the first individuals in the nation to pursue and achieve the CISR Elite designation, Temple is currently working toward her AIAF and ARC designations while attending graduate school.

A wearer of many hats, Temple is active outside of her agency as chairman of the Agency Management and Technology Committee of the Independent Insurance Agents of NC, is the bookkeeper for A Dog’s Dream Dreamer’s Foundation and teaches free victim advocacy courses in the evening to local communities.

www.ibamag.com

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FEATURES

COVER STORY: YOUNG GUNS ERIK NETTERFIELD Executive underwriter HUDSON INSURANCE GROUP Age: 33

It was important for Erik Netterfield to come into his own, and insurance gave him the opportunity to do just that. Not only did the industry offer good pay and growth opportunities, but it also gave him a chance to try different lines of business; he eventually found P&C to be a better fit than the health insurance that is his family’s trade.

Netterfield has been with Hudson Insurance Group since 2008 and has expanded its railroad protective liability programs from just five states to 48, with a 300% increase in premium. He was promoted to senior underwriter in 2013 and to executive underwriter earlier this year. His other significant contributions include building a model for reviewing the profitability of potential M&As and developing a company-wide data dictionary for all programs within every underwriting unit.

NICOLE JOLLEY Underwriting team lead, nonprofit and human services GUIDEONE INSURANCE Age: 30

After experiencing hard times following Hurricane Katrina, Nicole Jolley recognized the tremendous effect insurance can have: “What I learned about insurance is that a single industry has the ability to impact a person’s life significantly, and I was going to be a part of something bigger than myself.”

Recently, Jolley was promoted to lead the GuideOne team that she helped build from the ground up. “Nicole consistently hits high individual production targets for her team while juggling other responsibilities, including mentoring and training new employees, streamlining processes, and marketing to existing and new GuideOne agents,” says a colleague. Last year, Jolley was selected by senior staff for a GuideOne True Leader Award, recognizing her service as a subject matter expert for the nonprofit product within the GuideWire commercial lines systems implementation, which resulted in new procedures that helped her unit exceed its revenue goals for 2015.

Dedicated to mentoring her co-workers and peers, Jolley is a member of the 2016 GuideOne Emerging Leader Leadership Development Program, serves on various committees on the board of CPCU, and teaches courses at The Institutes.

ADAM ZIEMBIEC Senior client manager THE HARTFORD STEAM BOILER INSPECTION AND INSURANCE CO. Age: 34

Determined to find a career that was counter-cyclical yet still intriguing led Adam Ziembiec down the path of insurance. A member of AAMGA and Gamma Iota Sigma, Ziembiec has been on the broker, wholesale and carrier sides of the business, working at companies such as McNeary and Hull & Company. Currently, Ziembiec serves as senior client manager at Hartford Steam Boiler, where his book of business has quadrupled in size during the nine years he has been with the company.

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AUSTIN J. POWERS Regional vice president, commercial lines THE HANOVER INSURANCE GROUP, INC. Age: 35

With more than 12 years of insurance experience, Austin Powers has played a key role in driving improved coordination and further accelerating The Hanover’s operations in Texas since he joined the company in 2014. Recently promoted to regional VP in March, Powers is responsible for all commercial lines of business in the eastern and southern regions of Texas, where he leads all strategic planning. As an emerging leader, Powers also participates in The Hanover/ Massachusetts Institute of Technology Leadership Program, which helps emerging executives further strengthen their leadership and innovation skills.

“Together with our local specialty leaders, Austin has further advanced our momentum and penetration with the best agents in this important territory for our company,” says Jack C. Roche, EVP and president of business and field operations at The Hanover. He brings a terrific energy and strong intellectual curiosity to The Hanover, which is reflected in his work and in his team.”

In addition to his responsibilities at The Hanover, Powers supports many community and industry organizations.

He’s a member of the Independent Insurance Agents of Houston, a founding board member for the Houston chapter of the Insurance Industry Charitable Foundation and volunteers his time as a member of Junior Achievement.

www.ibamag.com

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5/08/2016 4:59:28 AM

MATT MEYER Area president RISK PLACEMENT SERVICES, INC. Age: 33

Matt Meyer joined Risk Placement Services 11 years ago after graduating summa cum laude with a BS in mathematics from the University of Kentucky. He began his career in insurance by spending nine months as an agency intern at the Scottsdale School of Underwriting, followed immediately by brokering new business for RPS. In 2012, his role expanded to include managing the brokerage department in the RPS Lexington office. Meyer has grown both his book of business and the brokerage department as a whole every year over the past decade. Earlier this year, he was promoted again to lead the RPS Lexington office as area president.

Meyer has also been active in various associations, supporting both his insurance carrier and retail agency partners; he was named Company Person of the Year by the Independent Insurance Agents of Kentucky and later served on their Young Agents Committee.

www.ibamag.com

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FEATURES

COVER STORY: YOUNG GUNS LUCAS HUTCHINSON Underwriting manager HULL & COMPANY, INC. Age: 34

In the six years that Lucas Hutchinson has been in the insurance business, he has grown his book from $0 to $1 million in annual revenue, with 15% to 20% growth year-over-year. He now runs his own office and recently obtained his RPLU designation. He’s also a member of PLUS and the AAMGA Under Forty Organization.

Hutchinson’s advice to the next generation of insurance professionals: “In your early stages, focus on becoming an expert in insurance, learning and mastering coverage forms. You cannot compete with experience, but you can compete with knowledge.”

ANDREW ENDERS Vice president and general counsel ENDERS INSURANCE ASSOCIATES Age: 32

Andrew Enders credits his place in the insurance industry to a great mentor – one who started showing him the ropes at an early age: “My father, whom I’m so lucky to work with each day, invited me into the office on a regular basis,” Enders says.

“He shared his passion for insurance and risk management with me and showed me how it could be used to help others.”

Enders is not only working to increase business and achieve double-digit growth again this year, but he has also helped Enders Insurance Associates transition to a newer cloudbased agency management system that offers a more consolidated process. Outside the company, he is an avid music fan and guitarist, and serves as president of Harrisburg Young Professionals and as a board member for the Harrisburg Regional Chamber of Commerce.

He was also named one of Central Pennsylvania’s 40 Under 40 for 2015.

“Listen more” is his advice to other young professionals; he encourages them to have meaningful conversations in order to ignite a passion for helping others.

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LYDIA ADAMS Senior commercial underwriter, environmental and energy specialist CONCORDE GENERAL AGENCY Age: 26

From originally pursuing a degree in piano performance to obtaining a degree in chemistry, Lydia Adams nonetheless finds a way to call on her educational background every day as a member of Concorde’s environmental and energy department.

“When I was going to school, I hadn’t thought about a career in insurance,” she says, “but I use my degree all the time, and I love what I do.”

Within the last six months, Adams has doubled the annual revenue of her department at Concorde. In that time, she has also been recognized as a top new business underwriter three months in a row.

Best advice for other young professionals “I meet people all the time who end up being agents or clients.

I attend the webinars that my agents are taking when I can, both to know what they’re learning and to help focus my conversations around what’s on their minds at the time.”

www.ibamag.com

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5/08/2016 4:59:37 AM

RYAN MORRIS Vice president and Midwest regional excess manager NAVIGATORS MANAGEMENT COMPANY Age: 33

After graduating from Olivet College’s risk management program, Ryan Morris took the insurance route. It’s a good thing he did, because in the three years he has been with Navigators, the company’s gross premium increased from $6 million to $12.8 million. Prior to his current role, Morris worked for various companies, including AIG and Ironshore.

Best advice for other young professionals

JENNIFER KESSEL Marketing director USG INSURANCE SERVICES, INC. Age: 27

Jennifer Kessel has moved up the ranks at USG Insurance Services, where she started as a marketing and communications intern; in July, she was promoted to marketing director. Kessel has built the in-house marketing team at USG while leading USG’s subsidiary into innovations, offering marketing and advertising consulting services. Due to the efforts of Kessel and her marketing team, USG recently received the 2016 AAMGA Community Service Award.

Very active in industry associations and in her local community, Kessel sits on the board of directors for the Insurance Club of Pittsburgh and has served on the I-Day Photography & Website Committee since 2014. She’s also served as fundraising committee chair, event chair and event co-chair for Relay For Life, in addition to volunteering her time to Big Brothers Big Sisters of America and the Special Olympics.

Furthering her commitment to charitable endeavors, Kessel has put together several fundraising projects within USG, such as an Angel Tree program that benefited low-income families in the community during the holiday season.

“It takes years to create a relationship but only a few minutes to ruin one! Remember, you’re not playing with Monopoly money; [for] every insurance policy you underwrite, you’re putting your company's capital on the line. Make the right decision!”

THOMAS PYTEL JR. VP of marketing & communications NAUTILUS INSURANCE GROUP Age: 35

Since beginning his insurance career in 2006 as a senior designer at professional liability insurance startup Darwin Professional Underwriters, Thomas Pytel has advanced through leadership and strategic marketing roles. At the age of 26, he led all creative branding for Darwin before becoming director of creative services and later AVP, overseeing global creative development and product marketing for Allied World Assurance Company.

In 2011, Pytel accepted the role of VP of marketing & communications, agency management and direct sales at CAMICO Mutual Insurance Company. There, he led his team to create a direct sales pipeline that saw 38% top-line growth within the first 12 months and has since sustained top-line growth for the organization. In addition, Pytel won two SAMMY Awards from the Insurance Marketing and Communications Association in 2013 and 2015 for his work with CAMICO. Over the year and a half that Pytel has been with Nautilus Insurance Group, he has been instrumental in redefining the company’s marketing and branding efforts.

www.ibamag.com

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FEATURES

COVER STORY: YOUNG GUNS DAKOTA CRABTREE Chief operations officer THE THOMPSON GROUP Age: 24

Talk about starting early – Dakota Crabtree began working at The Thompson Group at age 15. Now he manages the operations of 18 people in two states, and has helped set up a new agency. As a millennial himself, he understands the generation’s need for work to be mobile, and thus has worked to update the company’s policies and procedures by implementing ideas such as Work At Home Vintage Experts and virtual assistants. His predecessor commends him for being innovative and proactive, saying that “at 24, he can run circles around every other previous person who has filled this position.”

LOGAN S. MCLAIN Business development analyst THE HARTFORD STEAM BOILER INSPECTION AND INSURANCE CO. Age: 26

GREG GAYLOR III Executive vice president GAYLOR INSURANCE AGENCY Age: 34

Greg Gaylor III found a way to soar high and have his feet on the ground at the same time by combining his passion for aviation with an insurance career. “Insurance has always been in my blood,” he says. “It is also the reason I fell in love with aviation as a little boy. My dad propelled our agency into aviation lines in the late ’70s. We used to go to air shows and visit other aviation clients when I was four years old. I haven’t stopped looking up at airplanes since.” A former regional airline pilot, Gaylor eventually joined the family business, as it allowed him to juggle his many different responsibilities – a young family, Navy duty and a passion for leadership opportunities.

Gaylor’s accomplishments in insurance include being a co-founder of a sUAS [small Unmanned Aircraft Systems] tech-based insurance solution and founder of a sUAS-based thermal image processing application for detecting ice dam formation.

He is also part of the Aviation Insurance Association and the Experimental Aircraft Association Young Eagles Program.

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“The impetus now lies within the hands of the younger professionals to continue the trend that our predecessors started,” says Logan McLain, who, like most, fell into the insurance industry by happenstance, a chance that he is grateful for today.

With the assistance of his client company manger, McLain has been able to book $250,000 in premiums, $100,000 of which he was able to achieve as a result of his research and analysis of general budgets with a pool of governmental risks.

A member of the AAMGA Under Forty Organization, McLain has also served as vice president of Sigma Pi Fraternity International and has volunteered his time to organizations such as Citizens for Animal Protection.

www.ibamag.com

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5/08/2016 4:59:48 AM

MEGAN GILLESPIE Commercial production underwriter GENESEE GENERAL OF COLORADO Age: 29

Megan Gillespie started out in marketing before transitioning into underwriting; she now boasts more than seven years of experience in commercial excess & surplus lines. Gillespie developed the transportation department at the Genesee General of Colorado branch office and facilitated the expansion of the agency’s footprint into new states. She recently completed her CIC designation and has doubled her book of business year-to-date over 2015.

Looking to pass the torch to new insurance professionals, Gillespie participates as a panelist on industry nights at local universities organized by PIIAC Young Insurance Professionals, and has spoken as a guest lecturer for classes at the University of Colorado’s risk management and insurance program. PIIAC also recognized Gillespie with their Company Underwriter of the Year Award in 2014.

“Megan is a consistent advocate for the insurance industry and has worked hard to promote our agency within the industry,” says Genesee General’s Gloria Jimenez. “She takes on new challenges and special projects with enthusiasm and brings her unique perspective into every undertaking.”

www.ibamag.com

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FEATURES

COVER STORY: YOUNG GUNS ADRIANE STACHMUS Director of sales and marketing ONE GENERAL AGENCY Age: 30

Developing the One General Agency [OGA] brand by launching a new website, while also personally managing and creating the marketing and communication pieces for the company, is just one of Adriane Stachmus’ many accomplishments.

Beginning in the industry as a part-time marketing employee, Stachmus capitalized on that opportunity and turned it into a career. Throughout the years, she has launched marketing efforts for new product lines and company partnerships, helping OGA meet carrier goals, solidify relationships and offer a broader range of products to meet the specialty insurance needs of its partners. As a result of her efforts, Stachmus has been recognized internally for her outstanding customer service and dedication.

Outside her company, Stachmus is a member of various trade organizations, including the Oklahoma Young Agents Committee and the AAMGA Under Forty Organization.

CHRIS PETERSON Vice president CHRIS-LEEF GENERAL AGENCY, INC. Age: 32

Chris Peterson grew up in the industry, spending many summers and school breaks working in his family’s insurance business. But it wasn’t until a summer job as a personal lines assistant underwriter that Peterson became set on a career in the industry. After graduating from college, he spent two years working as an associate underwriter for Nautilus Insurance Company.

In 2009, he moved to the Kansas City area, where he currently works for Chris-Leef General Agency as vice president, overseeing all business operations for the company. Since he took over daily management operations in 2013, the company has doubled in size through organic growth, product and program development, and acquisition.

Understanding how important education is to this complex industry, Peterson has earned various desig­ nations and completed the AAMGA UFO Leadership Education program.

He currently serves as SVP of the Under Forty Organization board, and is chairman of the Bell & Clements Advisory Council and on the Nationwide E&S/ Specialty Agent’s Advisory Board.

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JUSTIN KOTRLA

MIKE MITCHELL

Vice president

RISK PLACEMENT SERVICES, INC. Age: 32

SOUTHWEST RISK Age: 34

Justin Kotrla takes pride in being one of the top property and inland marine brokers at Southwest Risk. He has attained top revenue growth from 2011 to 2015, and has had a compound annual growth rate of more than 15% in the last four years. Outside of work, he is co-chair for the Texas Surplus Lines Association’s Texans Under 40 Committee and an associate board member at the Insurance Industry Charitable Foundation.

Underwriting manager

From summer intern to underwriting manager, Mike Mitchell has worked his way up at Risk Placement Services over the past decade. A transportation risk underwriter, Mitchell has built his book of business to $500,000 in revenue, a number he has maintained for the last two years. He has been recognized as a top performer at RPS for the last three years and was awarded with one of six Underwriting Excellence Awards given annually to top RPS underwriters.

www.ibamag.com

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JIM HIGGINS Account executive CRC INSURANCE SERVICES, INC. Age: 28

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[I] quickly learned that with enough entrepreneurial drive and hard work, the sky was the limit. I’ve seen few other industries that afford people coming out of college as many opportunities to find their own path.” Higgins started as an intern at CRC and now oversees the renewal book and manages complicated placements; his team has kept an average annualized revenue growth rate of 20% since 2013.

Higgins has been on several insurance carrier and producer advisory committees, and also contributes to nonprofit organizations such as the National Multiple Sclerosis Society. He is part of the Reavis High School District 220 board of education and does fundraising work for the school’s education foundation.

JEFF CECCHINI Senior vice president and partner MONTGOMERY & GRAHAM, INC. Age: 33

A licensed agent since 2004, Jeff Cecchini specializes in commercial fleet auto, restaurant and contractor insurance programs. Since he joined Montgomery & Graham, he has led the P&C department to achieve a 50% growth rate for two years in a row, along with a 400% increase in staff for three years. Having held nearly every position at the company, he is now SVP and partner, and just celebrated his 10th anniversary with Montgomery & Graham.

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FEATURES

COVER STORY: YOUNG GUNS

MATTHEW KIDD Transportation underwriter GREAT LAKES GENERAL AGENCY Age: 33

When Matthew Kidd joined Great Lakes General Agency five years ago, he had zero underwriting experience but an insurance background as an agent for life, health and investment products. His goals at the time were to help the agency develop and grow new relationships and help strengthen existing ones, along with producing profitable business.

Over the past five years, Kidd has been able to grow his book to $5 million in premium.

“GLGA has been looked at as a transportation expert for the past 28 years, and our continued goal is to provide the top expertise possible in dealing with commercial trucking accounts,” Kidd says. “I plan to continue to help grow and strengthen our company in any way possible in the coming years.”

NICK GRAHAM Underwriter NAUTILUS INSURANCE GROUP Age: 34

In both his personal life and career, Nick Graham has demonstrated his belief that “perseverance is the secret to all triumphs.” More than 10 years ago, while working in standard lines, Graham set a goal to work in the E&S market, where he was attracted to the flexibility in forms and rates. Currently, as an underwriter at Nautilus, Graham enjoys working on those unique, high-level risks he’d aspired to write earlier in his career. Graham handles a $10 million book of business with assigned agent growth above 20% through the first half of 2016.

He also networks with and supports the industry’s future leaders as a member of the Nautilus NextGen Committee, AAMGA Under Forty Organization, NAPSLO Next Gen and NAPSLO Technology Committees.

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VICTORIA LEARNED-FENTY Professional liability broker BURNS & WILCOX Age: 29

In her first year of production at Burns & Wilcox in 2010, Victoria Learned-Fenty developed a successful book of P&C business totaling more than $1.4 million in premium. Promoted to her current position in May, Learned-Fenty is now responsible for growing Burns & Wilcox’s market share across all professional liability lines of business throughout the Midwest region. In the four years she has been in the industry, Learned-Fenty has been recognized at Central Indiana’s CPCU I-Day event for completing the AINS, AIS and AU designations. She is also a Girl Scout troop mentor, a member of the AAMGA Under Forty Organization and an InVEST Insurance Program administrator. Additionally, she was nominated this year for PIA of Indiana’s Company Person of the Year Award.

Fun fact The daughter of a pastry chef, Learned-Fenty is currently working on a novelty cookbook. “Becoming a published author is an item on my bucket list. My copyright application was approved this spring, and I couldn’t be more excited to see where this new venture will take me!”

www.ibamag.com

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5/08/2016 5:00:09 AM

DANIEL J. KAUFMAN Senior vice president H.W. KAUFMAN FINANCIAL GROUP/ BURNS & WILCOX Age: 31

Following in his father’s and grandfather’s footsteps in the insurance industry, Daniel J. Kaufman is a thirdgeneration leader and new appointee to the board of directors at H.W. Kaufman Financial Group, the parent company of Burns & Wilcox, where he was recently promoted to SVP of the Chicago office, in charge of overseeing daily operations.

A member of the State Bar of Michigan, Kaufman currently serves on several corporate, civic and advisory boards, including the City of Hope National Insurance Industry Council, the Midwest Insurance Industry Charitable Foundation and the Kaufman Family Foundation.

An advocate for maintaining talent within the insurance industry, Kaufman was instrumental in the development of Kaufman Financial Group’s Emerging Leaders Program, and was awarded the H.W. Kaufman Financial Group Leadership Distinguished Service Award in recognition of his efforts. In addition, he also won the 2015 William R. Story Memorial Award from City of Hope for his leadership and professionalism.

www.ibamag.com

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FEATURES

COVER STORY: YOUNG GUNS FRANCIS JOHNSON JR. Vice president, personal lines JOHNSON & JOHNSON, INC. Age: 27

After graduating from the University of South Carolina, Francis Johnson spent two and half years moving around the world, gaining insurance experience in many different segments of the industry. He spent time in London, Arizona and Bermuda, where he was able to work with both domestic and international primary insurers and reinsurers. Now vice president of personal lines at Johnson & Johnson, he oversees five departments and more than $150 million in premium. Johnson is responsible for the strategic direction of Johnson & Johnson’s personal lines division, which has continued to grow under his leadership.

ALYSSA GUERRIERI Underwriting manager NAUTILUS INSURANCE GROUP Age: 30

TOPHER FYLAK Commercial P&C underwriting manager NATIONWIDE E&S/SPECIALTY Age: 32

Despite growing up in a “claims world” where both of his parents worked in the claims business, Topher Fylak initially knew very little about the insurance industry. But after he was selected to attend a formal underwriter training program, Fylak quickly became fascinated with the industry and E&S underwriting. Today, he leads a team of 11 underwriters and assistants who underwrite commercial E&S business for more than 20 MGAs in the Southeast region. Since taking the helm, Fylak has increased his unit’s staff to support premium growth of more than 27% while reducing loss ratios by more than four points, leading to his team to score in the 92nd percentile for engagement in the Nationwide organization.

A former attendee of NAPSLO School and the AAMGA Under Forty Organization Leadership Education Program, Fylak pays it forward by mentoring new associates in the field. “I enjoy the development of associates by continuing to be a mentor for new underwriters and being asked to facilitate training classes and participate in interview panels for different internal leadership programs,” he says.

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Since she started in the insurance industry in 2007 with Zurich Insurance Group, Alyssa Guerrieri has held a variety of positions in marketing, sales and underwriting for both carriers and agencies, all of which have contributed to and shaped her professional growth, broadened her perspective and given her a well-rounded understanding of what makes the E&S market so dynamic. By challenging herself to face the unfamiliar and seize new opportunities, Guerrieri embraces change and new experiences as they arise.

Skilled at cultivating strong relationships with her agents, Guerrieri contributed to the double-digit percentage growth of her assigned book of business in 2015 by marketing for unique business opportunities, hosting educational webinars to clarify company risk appetite and finding creative ways to underwrite risk.

JOHN CHISENHALL Regional marketing manager PATRIOT NATIONAL, INC. Age: 35

Responsible for all sales activity in 13 states throughout the Midwest, Southwest and Mountain regions, John Chisenhall manages a $75 million book of business for Patriot National. In September of last year, he was named Salesperson of the Year for the entire company.

GEOFFREY W. CRATER VP of underwriting HANOVER EXCESS & SURPLUS, INC. Age: 32

“Growing up in an insurance household allowed me to see the world of opportunity in the industry,” Geoffrey Crater says. Today, Crater directs and leads the underwriting and marketing operations in commercial, personal and professional lines for Hanover Excess & Surplus. Since arriving at the company, Crater has expanded its carrier and program offerings with Lloyd’s and domestic carriers, bringing in more than $2.5 million in premium.

ZOHREH TALEBZADEH Team leader

Some games shouldn’t be played without a safety net.

EPIC INSURANCE BROKERS Age: 30

Insurance was not Zohreh Talebzadeh’s first choice for a career, but her affinity for the industry deepened as she learned more about it through her company, EPIC, which has allowed her to shape and grow her career.

Getting to manage the company’s intern program allows Talebzadeh to not only bolster EPIC’s success, but also teach college graduates about the benefits of a career in insurance while learning about various generational differences. Talebzadeh also currently serves as vice president of Emerging Insurance Professionals, where she organizes events that provide networking opportunities for insurance professionals and benefits for charitable organizations.

NAPSLO members are specialists who create innovative solutions for nonstandard insurance risk. Count on them to deliver custom, costeffective solutions that are expertly tailored to meet your specific insurance needs.

NAPSLO members... where complex risk meets innovative solutions.

National Association of Professional Surplus Lines Offices

www.napslo.org

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FEATURES

COVER STORY: YOUNG GUNS DEVON BORISOFF Underwriter and director of marketing MONARCH E&S INSURANCE SERVICES Age: 27

A third-generation insurance professional, Devon Borisoff joined the industry in 2011 after graduating from the Marshall School of Business at the University of Southern California, where he was an athlete on the USC men’s water polo team, winning three national championships and three conference titles. Since joining the business, Borisoff has worked for USLI as a marketing representative, visiting more than 2,500 agents in less than two and a half years. In 2015, he spent a year working as a broker at Lloyd’s of London, specializing in North American property business.

ALISON SPECK Owner and producer MVP AGENCY, INC. Age: 34

CHRIS RABURN Transportation underwriter GENESEE GENERAL Age: 28

“I was motivated to pursue a career in insurance because I enjoy being in a changing industry [and] building relationships with people,” says Chris Raburn. Starting off as an underwriter assistant two years ago, Raburn was quickly promoted to transportation underwriter at Genesee General. Outside of his role at the company, Raburn is a member of AAMGA’s Under Forty Organization.

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Four years ago, Alison Speck and her father teamed up to build their own independent insurance agency, MVP Agency. Starting from scratch, they managed to grow a $1 million book of business in their first three years of operation.

Highly involved inside and outside of the office, Speck keeps busy with various trade and community organizations, in addition to founding a couple of her own.

In 2005, she started a local Amspirit Business Connections chapter, where she served as president for several years.

However, her proudest affiliation is with Stork Squad, a group she founded with a fellow mother that provides ‘Welcome Baby’ packages to new moms in the community.

As a working mother of three, Speck emphasizes how the industry’s flexible nature can be great career for anyone, including mothers. “You will have to work hard, but it is flexible, so you can have a nice family life as well,” she says.

COLLEEN GILESHARRIS Director of centralized office services RISK PLACEMENT SERVICES, INC. Age: 35

As director of centralized office services for Risk Placement Services, Colleen GilesHarris created the standard operating procedures to help centralize various support staff functions from five satellite offices to the company’s main office in Eau Claire, Wisconsin.

A 13-year industry professional, Giles-Harris has been underwriting and managing a large national program since the onset of her career. In 2015, she was involved in the implementation of two additional large national programs at her office; together, the three national programs produce $4 million in premiums.

Outside of RPS, Giles-Harris was the first woman elected as president of the AAMGA Under Forty Organization in 2010; she then served on the AAMGA board as UFO past president until 2012.

EMILY DWYER Senior private client marketing specialist COOK MARAN & ASSOCIATES Age: 33

After spending several years doing fundraising for nonprofit arts organizations, Emily Dwyer was looking for a change – one that she found in insurance. “I saw a job posting in the local paper, and knowing nothing about insurance, it was the reputation of the agency and the people I met during the interview process that truly motivated me to start down this path,” she says.

Now with Cook Maran & Associates, Dwyer works alongside personal lines managers and the executive director to redesign private client best practices and procedures. Dwyer recently obtained her AAI-M designation and is currently working toward her CPRIA certification. A lifelong lover of art, she is a member of the Contemporaries Circle at the Parrish Art Museum in Southampton, New York.

RICK ALFONSO Assistant vice president, senior casualty broker WILLIS TOWERS WATSON Age: 29

Leveraging his background in economics, Rick Alfonso became fascinated with quantifying, describing and predicting the behaviors of large and complex real-world systems. After two years at Willis Towers Watson, Alfonso was appointed to a lead brokering role within the firm’s large/complex transportation & logistics portfolio, and after three years, he was promoted to AVP of middle-market brokering. He now serves as AVP and senior casualty broker for the Midwest region.

Outside the office, Alfonso volunteers as a court-appointed special advocate of Cook County, where he serves abused and neglected children in the DCFS foster care system by ensuring that their best interests are investigated and represented by the court.

Best advice for other young professionals “Don’t hesitate to roll up your sleeves and take on work and projects that may not seem appealing to you.”

VINCENT DINKELMANN Commercial lines underwriter W.A. SCHICKEDANZ AGENCY, INC./ INTERSTATE RISK PLACEMENT, INC. Age: 25

Recruited into the industry right out of college, Vincent Dinkelmann wanted a “fast-paced and knowledge-driven” career, and insurance afforded him just that. He was part of AAMGA’s first Underwriting Bootcamp in 2014, and just nine months into working with W.A. Schickedanz Agency, he was assigned to take over a large book of commercial business, which gave him the training ground he needed and led to his promotion to commercial lines underwriter earlier this year.

Dinkelmann is an active participant in AAMGA’s Under Forty Organization and is also part of the Young Agents of Independent Insurance Agents of Illinois.

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FEATURES

COVER STORY: YOUNG GUNS MELANIE HERRING Product line specialist, underwriting innovation NAUTILUS INSURANCE GROUP Age: 32

Melanie Herring’s 10-year insurance career has thrived on taking chances. She spent the first seven years of her career as a commercial underwriter in standard lines before making the jump into E&S commercial underwriting at Nautilus, where she has spent the last three years. In 2015, Herring was promoted to product line specialist, a new role on the underwriting innovation team at Nautilus, which was formed with the express purpose of building new products and enhancements. For Herring, product development is the perfect fit for her analytical mind, which craves creative thinking and problem-solving. Earlier this year, she completed her CPCU designation after receiving The Institutes' President’s CPCU Scholarship.

DANIELLE WADE Chief operating officer JACKSON SUMNER & ASSOCIATES Age: 32

Like most kids who grew up around the insurance industry, Danielle Wade had no intention of joining the family business.

“I wanted to step out and do my own thing,” she says. “But as I learned more and more about what my father did and the relationships he had built, the more I realized that the insurance industry had a lot to offer.” Two years ago, she was promoted to COO at Jackson Sumner & Associates, a family-owned E&S specialty lines MGA based in North Carolina.

Wade has also served two terms as president of NCSLA, is immediate past present of the AAMGA UFO, currently serves as vice chair of Appalachian State’s Brantley Center advisory board and sits on East Carolina’s risk management and insurance advisory board.

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WILL MONTGOMERY

JOHN POUCHER

CEO

Sales and marketing manager

MONTGOMERY & ASSOCIATES INSURANCE AND FINANCIAL SERVICES Age: 33

ABRAM INTERSTATE INSURANCE SERVICES Age: 33

In 2010, Will Montgomery made a major gamble, leaving his career as a captive agent to form his own independent agency, Montgomery & Associates Insurance and Financial Services. It’s safe to say that gamble paid off – over the past four years, Montgomery’s Nashville-based agency has experienced astounding revenue growth of more than 600% and was named Small Business of the Year by the Nashville Business Journal in 2015.

Introduced to the industry by a mentor, John Poucher has led the effort to restructure the sales and marketing department at Abram Interstate Insurance Services, including revamping sales compensation packages and designing incentive programs. He was instrumental in the creation and piloting of Abram’s inside sales efforts, and he plans to expand the department in the future.

Outside of his duties at Abram, Poucher is a member of the AAMGA Under Forty Organization.

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DIANA DEMENT Director of underwriting CENTURY INSURANCE GROUP Age: 34

JOE HARNER Director of inside sales AEGIS GENERAL INSURANCE AGENCY Age: 35

When he started out in the industry, Joe Harner immediately saw that insurance was more than just a business. “Early in my career, I was attracted to the significant impact insurance has on our society, and vice versa,” he says.

“Hurricane Katrina and the recession in the late 2000s are considerable examples [that occurred] during my tenure. The extent to which our industry influences the world is impressive and undeniable.”

Recently promoted to director of inside sales, Harner leads a team of P&C producers and has his sights set on attaining double-digit growth in 2016 for both the team and his personal book.

Harner feels seeking mentorship is key for those just starting out in insurance to establish a good foundation. “Take advantage of the time you get to spend with industry veterans,” he says. “Shadow them, ask them tons of questions, bounce new ideas off them, and always ask for constructive feedback. Fundamentals often remain constant. Your contributions will be greater by learning from the past and building off of it.”

At Century Insurance Group, Diana DeMent established and leads a team entirely focused on P&C contract authority business. Her leadership resulted in a reduction of the gross ultimate loss ratio to 52.4% in the P&C binding book in 2014, down from 97.1% in 2011. “With the consistent profitability of this book,” she says, “my current mission is finding ways to expand authority to our agencies to better service our partners and to make Century a leading, powerhouse binding market.” Recently, DeMent testified in her first trial at Philadelphia City Hall, where she explained intention of coverage through forms and specific underwriting processes.

ALYSSA BOUCHARD Assistant executive director AAMGA Age: 24

At just 24 years old, Alyssa Bouchard is already the winner of the Alan C. Williams Leadership Award, given by Gamma Iota Sigma to an individual it feels is the best ambassador to the insurance, risk management and/or actuarial science industries. As a management major, Bouchard was inspired to go into risk management and insurance because of its“95% job placement rate, plentiful scholarships, and travel opportunities,” she says.

In her role at AAMGA, Bouchard is responsible for creating job and internship opportunities for students, overseeing the Student White Paper Research Competition, implementing an Underwriting Certificate program, and training “the best and brightest risk management and insurance student leaders from the US and Canada.”

ZACHARY EBERSON Account executive MCMAHON INSURANCE AGENCY Age: 28

After promising to help a client take back control of their workers’ compensation policy just two weeks after becoming their new agent, Zachary Eberson was able to save them $32,000 because of an error made by the previous agent.

The youngest producer at McMahon Insurance Agency, Eberson has led his team in monthly production and is currently second in production at his office.

His involvements outside the company include creating the South Jersey Young Professionals Group and being an Ambassador for the Cape May County Chamber of Commerce. He also spends time coaching high school athletes as head coach of the Ocean City Master’s Crew Team. Eberson also recently braved the Hudson River, biked along Manhattan’s West Side Highway and ran through Central Park in the 2016 New York Triathlon.

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The generation game: Recruiting the new workforce The shifting demographics of the insurance industry are forcing carriers and brokerages to rethink how they operate. Now that Baby Boomers are reaching retirement, industry leaders need to learn how to attract the next generation to insurance 44

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Some things come out of nowhere, like Pokemon Go. Others we can see coming for years, but they still seem to catch many of us unprepared.

Insurance professionals have been talking about our graying industry for years, but we haven’t done enough to prepare. We’ve opined countless excuses: the cost of training, lack of talent, focusing on perpetuation. It’s time to stop saying we are trying to figure it out and do something about it now. We must recruit, train and – most importantly – retain this new generation.

There is no magic pill. But there is a strategic plan and vision we can follow. How we execute that plan will determine our success going forward. That strategic plan is to empower a new generation of professionals to discover, embrace and lead a dynamic industry full of promise and opportunity.

It starts with recruiting. Connect your younger producers or underwriters with these emerging professionals. They can relate as peers in a way that more senior workers may not. That understanding and peer-to-peer guidance is the first step in welcoming them to insurance.

Next is training. There’s no one right way, but you absolutely have to articulate and execute your plan, or your recruits won’t stay. Many training programs include mentoring to leverage the experience of senior staff. Don’t overlook this valuable component.

Generationally, the employees may be distinct, but the insight and experience they can share is powerful and valuable.

Finally, focus on retention. Don’t make false promises of leadership tracks with no leadership at the end. And while not every hire will work out, hiring slowly and thoughtfully will help reduce turnover.

Young professionals want feedback – and you should, too. Your work culture is as important as salary and benefits to this generation. Take an honest look at that culture and hire accordingly. The industry is changing – embrace the change; don’t fear it.

Matt Lynch President Under Forty Organization, American Association of Managing General Agents

THE CHANGING face of the insurance talent pool is making agencies and brokerages redesign their structures and policies in order to remain competitive, attract the best talent and retain millennial staff members in whom they’ve invested significant time, effort and money.

“The insurance industry has a lot of companies whose staff are getting older, and that’s creating a real need for those organizations to attract the next generation of the workforce,” says Davis Moore, chair of the Career Development & Next Generation Committee for the National Association of Professional Surplus Lines Offices [NAPSLO]. “Historically, our industry is not well known for making insurance an attractive choice for the folks coming out of college.

The industry has not done a great job in making insurance one of the top three of four choices, but that is changing.”

Simply put, millennials demand more from their careers than previous generations. They expect to be rewarded with career progression and competitive remuneration, and they want to do meaningful work that resonates with them.

“Companies need to recognize the need to perpetuate their business by reinvesting in the business, and that means bringing on the next generation of the workforce,” Moore says. “It’s enormously important to any company in the insurance industry, and there are a lot of great resources for employers to tap into.”

Millennials are also bringing a different value system into the workforce. The stereo-

type that millennials are lazy is misplaced; members of this generation are happy – even eager – to get their hands dirty, but their value system is different from what insurance brokerages (and companies across all industries) have witnessed in the past. Millennials entering the insurance industry want to be affiliated with organizations whose operating practices and reputation mirror their own values system. In fact, 56% of millennials say they would rule out ever working for a particular organization if they didn’t agree with its values.

“The millennial generation are not interested in the 9-5 norm; they want to get involved in trade associations, be involved in recruitment at career fairs and attend industry community events,” says Alyssa Bouchard, assistant executive director at the

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American Association of Managing General Agents [AAMGA]. “The more supportive companies are of millennials doing the extra things, the more successful they’ll be in attracting top talent.”

Shared priorities Organizations do have step up their game to attract and retain millennials, but the things that millennials want aren’t complicated or mystical concepts. Rather, they’re the same things that every professional wants: frequent feedback, flexibility, the chance to do meaningful work, and the ability to progress their careers and make connections with other people.

So what makes millennials different?

Unlike previous generations, they feel empowered enough to ask for, and expect, these things. “Millennials want to see a clear career path that leads toward success,” Moore says, “and they are in a more of a hurry to achieve that success than previous generations.”

Millennials will also make careerchanging decisions based on training, values and potential for progression. “All insurance companies should be evaluating how they are training their millennial staff members,

THE GENERATION GAP MILLENNIALS Born: 1981 to 2000 Age in 2016: 16 to 35 Population in 2015: 83.1 million % of the US workforce: 34% GENERATION X Born: 1966 to 1980 Age in 2016: 36 to 50 Population in 2015: 66 million % of the US workforce: 34% BABY BOOMERS Born: 1946 to 1965 Age in 2016: 51 to 70 Population in 2015: 75.4 million % of the US workforce: 29%

because this a key priority for this generation,” Bouchard says. “Also, collaboration and communication are ingrained into the working styles of millennials, and they want input and feedback, from both peers and superiors.”

Millennials will also turn down opportunities or resign from a role at a great company if they don’t feel that organization’s values and ambitions reflect their own – that’s a fundamental difference of this generation that employers in insurance need to understand.

“When it comes to searching for a fulltime job, one of the biggest things I’ll be looking for is a company with an ethical

culture that is aligned to my values,” says Molly Belmont, a risk management and insurance major at Temple University who’s due to graduate in 2017. “Equally important is finding a company that is growing and has room for me to grow. I wouldn’t want to start my career somewhere I know I’m not going to be able to move ahead.”

Millennials have grown up during a time of massive technological and societal change.

In addition to entering the workforce with a completely different set of expectations and behaviors than their parents, they are the first generation to be digital natives. “From a digital perspective, millennials are much better equipped to tackle the current issues

STUDENT CASE STUDY: BRIANNA ALLEN Currently studying insurance at Illinois State University, Brianna Allen has a clear idea of the type of company she wants to work for when she graduates. Like many millennials, she puts training and professional development at the top of her list of priorities.

She is also attracted to companies that have good opportunities for advancement and have defined paths to leadership positions.

“I also look for companies that are innovative,” says Allen, who is also the VP of student affairs for the Alpha Kappa chapter of Gamma Iota Sigma. “I did an internship at a company that has been doing things the same way for a hundred years, and I wasn’t a huge fan of that. They didn’t listen to ideas, and they were very shut off. I plan to work somewhere with a ‘work family’ environment, where the culture is collaborative and people work hard and play hard.”

To attract millennial talent at the source, Allen believes insurance brokerages and agencies should market themselves directly to college students. “When I started college, I was a finance major, and I knew nothing about insurance,” she says. “But insurance companies came into our college and did a really good job in informing us about the opportunity for growth and the job security within the industry, which is definitely a big thing.”

Insurance companies have a lot to gain by employing millennials, who, says Allen, are innovative by nature. “I know of a lot of older people in the industry who want to keep things the same, who struggle to keep up with technology. Millennials are very high-tech, and we want to change things.”

Allen also notices a fundamental difference in career expectations between millennials and previous generations. “A lot of our parents’ and grandparents’ generations have been content with not achieving impressive job titles or career advancement, but that’s something millennials really want,” she says. “We like recognition for doing good things, and we want to take on leadership roles. It’s the world we grew up in – we want more and we expect more.”

Offering constant training and development is essential for any insurance firm that wants to retain top millennial talent. “Companies also need to challenge millennials,” Allen says. “Move them around the organization and give them lots to do, because once a millennial gets bored, that’s when they want to move on. Keeping them challenged is huge.”

Source: Census.gov

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in the industry,” Moore says. “Millennials are much more engaged in social media and other digital areas that are going to be influencing the business going forward.”

Aligned for success Although the increasing number of millennials in the workforce is creating a fresh set of challenges for insurance brokerages and carriers, the situation shouldn’t be met with negativity – or worse, reluctance. Millennials are forcing the industry to update and enter the digital age, and ultimately that will benefit all staff members and help increase the bottom line.

edge gap caused by retiring Boomers.

“Organizations should really work out ways to create collaboration opportunities with millennials once they’re in the workforce,” Belmont says. “If you have a team mixed with Baby Boomers and millennials, it could accomplish more than a team just made up of millennials or a team made up solely of Baby Boomers.”

There is also alignment in the motivations of Boomers and millennials. Those nearing retirement are increasingly desiring flexible hours, the ability to do meaningful work and to work remotely – all of which are top priorities for millennials, too. This is positive

“Millennials want to see a clear career path that leads toward success, and they are in a more of a hurry to achieve that success than previous generations”

MILLENNIAL LOYALTY 66% of millennials expect to leave their organization by the end of 2020

63% of millennials say their leadership skills are not being fully developed

24% of millennials are very satisfied with their professional development

Of millennials who expect to leave their organization within two years: 52% have support/training widely available

71% believe their leadership skills are not being fully developed

Davis Moore, NAPSLO Career Development & Next Generation Committee With Baby Boomers either retiring or working into their 70s, insurance firms have a good opportunity to use the knowledge, skills and expertise of these seasoned employees in training and educating millennials on the insurance business. There is a strong alignment in the aims of millennials and Boomers that organizations should not overlook: Many Boomers have a desire leave their mark on the insurance industry, and passing on their years of on-the-job expertise is one way to secure that legacy.

Because many millennials are still in the developmental phase of their careers, pairing Baby Boomers with those young, hungry members of the workforce represents a good opportunity for brokerages and carriers to get the most out of their entire staff.

These partnerships can also play an integral role in plugging the inevitable knowl-

news for insurance companies, because it means they don’t necessarily need to develop two different sets of policies and programs to meet the needs of both groups.

Attracting the next generation Insurance companies are not in a position to overlook millennials, who are expected to make up 75% of the labor force by 2025.

A 2012 survey conducted by the Griffith Insurance Education Foundation discovered that only 5% of millennials are familiar with the insurance industry, and fewer than one in 10 expressed any interest in entering the business. The millennial generation – the most well-educated in history – is skeptical about the insurance industry, and it’s up to current leaders to convince them otherwise.

The need for insurance companies to recruit millennials is growing in urgency.

57% feel overlooked for potential leadership positions

Of millennials who expect to stay with their organization for more than five years: 68% have support/training widely available

54% believe their leadership skills are not being fully developed

42% feel overlooked for potential leadership positions

Source: 2016 Deloitte Millennial Survey

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STUDENT CASE STUDY: JESSICA GROENEWEGEN When Jessica Groenewegen starts applying for full-time positions this fall, she plans to target organizations whose ethos and ambitions match her own. In addition to focusing her applications on organizations that are committed to promoting from within, Groenewegen is also attracted to companies that are experiencing impressive growth.

“I’m currently in the middle of an internship where they have an open, collaborative atmosphere where all of the teams work together to make the company a better and a more profitable place,” she says.

For Groenewegen, joining an organization that embraces collaboration is integral. She’s determined to find an employer with a team environment and will likely turn down an offer from an organization without that strong team ethos.

“As soon as you walk into an office, it’s easy to tell if there are strong teams or if the employees are separated,” says Groenewegen, who is currently majoring in risk management and insurance at St. John’s University. “For my generation, it is really important to be integrated into teams and to have the opportunity to work alongside upper management as well as our peers.”

But Groenewegen’s list of culture must-haves doesn’t end there. “As a woman in the industry, I will be looking for companies that have women in upper management and executive positions – that can be hard to find,” she says. “I also look at whether a company gives back to the community and is actually going out and building homes and doing runs to raise money, rather than just writing a check.”

During her studies at St. John’s, Groenewegen has had the opportunity to attend numerous seminars and conferences where industry leaders have given talks to students. “It’s great for companies to be engaged in that way, to talk to students about the industry,” she says. “A lot of students have no idea how much you can do within insurance, and I was one of those people.

Since studying insurance and starting my internship, I’ve seen just how many different facets there are in one industry and how many different positions you can work toward.”

THE IMPORTANCE OF VALUES 44% of millennials have turned down a job offer because of an organization’s values 49% of millennials have chosen not to undertake a work task because it went against their personal values 55% of millennials consider personal values to be very influential when making decisions at work 56% of millennials have ruled out ever working for a particular organization because of its values Excluding salary, what are the drivers of employer choice for millennials?

16.8%: Work-life balance

0% However, despite this increased need for fresh talent, a 2015 Insurance Business America survey found that only 38% of agency employees claim to be prepared to meet the challenges of the impending talent gap. Agency and brokerage owners see the expense of recruiting and training and a lack of qualified applicants as the major obstacles in finding the next generation of top performers.

The reluctance of some current leaders to trust younger workers in leadership roles is directly reflected in the beliefs held by the next generation: 63% of millennials believe their leadership skills are not being fully developed, and yet the ability to progress and take leadership roles is one of the most important drivers for this generation when

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evaluating job opportunities.

“There are some common misconceptions of what insurance is and what level of opportunities are actually available to millennials,” Bouchard says. “But once students find out about the opportunities to travel, build relationships and advance their careers, it’s an easy sell. It’s important for the industry as a whole to address that misconception and show students in general what insurance is all about.”

Training and development Bouchard, who graduated from Appalachian State University in 2014, has witnessed a more concerted effort by the insurance industry to attract millennials in recent years.

5%

10%

15%

20%

13.4%: Opportunities to progress

0%

5%

10%

15%

20%

11.0%: Flexibility (remote working and flexible hours)

0%

5%

10%

15%

20%

9.3%: Sense of meaning from work

0%

5%

10%

15%

20%

8.3%: Professional development training

0%

5%

10%

15%

20%

Source: 2016 Deloitte Millennial Survey

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“Millennials are hungry for knowledge, so training opportunities and mentorships, both formal and informal, are things that factor into the decisions of the top graduating risk management and insurance students”

CULTURE & ENGAGEMENT

93% of insurance industry respondents indicate that culture and engagement is their top challenge

Alyssa Bouchard, American Association of Managing General Agents “We are seeing an increase in training programs and mentorships, and organizations are making more of an effort to reach out to millennials, which is essential,” she says. “Millennials are hungry for knowledge, so training opportunities and mentorships, both formal and informal, are things that factor into the decisions of the top graduating risk management and insurance students from across the country. Going forward, insurance companies are going to have to focus on these types of recruitment methods.”

NAPSLO created its Next Generation Leadership Council [NGLC] in direct response to the workforce vacuum that is threatening to impact the insurance industry. The council, which is made up of insurance professionals under the age of 40, helps attract new college graduates and young professionals to insurance. The NGLC encourages collaboration and communication among its members and is an avenue for young professionals to become more involved in the insurance world.

“A lot of the work we do at the NGLC is about listening to the wants and needs of this younger generation,” Moore says. “We’ve found that they’re interested in things they can’t get online, like face-to-face educational programs and networking events that are specific to their age ranges. This younger

generation wants to get involved and be collaborative.”

So far, in 2016, NAPLSO has placed 17 young people in five-week internship programs, where they’re immersed in the daily operations of insurance companies and wholesale brokers. Moore expects a high percentage of those participants to accept positions in the industry when their internships are complete.

“These internships are not just an opportunity for someone to enter an organization and do filing or compliance,” he says. “It’s an opportunity for the interns to get a wellrounded experience and to gauge what it would really be like to work in the industry full-time.”

Belmont, who was the AAMGA White Paper winner for 2016, thinks that hands-on training and meaningful internships are great ways to attract millennials. “Companies should also offer benefits packages that are appealing to millennials,” she says. “A great health plan is not really what we’re looking for; millennials want flexibility.”

In 2015, NAPSLO’s Career Development & Next Generation Committee reached more than 1,400 students across the US through 22 speaking engagements composed of symposiums, career fairs and college visits.

NAPSLO has also created a multi-year professional development program that

Less than 50% say they are ready to face that challenge

37% of insurance industry respondents are currently updating their retention and engagement strategy

35% said they have updated their strategy in the past 18 months

15% said they did not have a retention and engagement strategy

13% said that their strategy is outdated Source: 2016 Deloitte Millennial Survey

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FEATURES

NEXT GENERATION

THE VALUE OF MENTORSHIP

STUDENT CASE STUDY: BRIAN EIDELBUS

Among those who have somebody acting as their mentor: 94% are satisfied with their mentoring

91% describe the level of interest shown in their development as good

83% say their mentor provides good advice

61% of millennials currently have a mentor to turn to for advice

Among millennials who plan to stay with their organizations for more than five years: 68% have a mentor

32% do not have a mentor

Among millennials who plan to leave their organizations within two years: 56% have a mentor

44% do not have a mentor

Source: 2016 Deloitte Millennial Survey

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“Company culture is huge for me; that is one thing that I’ve been focusing on,” says Brian Eidelbus, who’s due to graduate with a finance, risk management and insurance degree from Florida State University this year. “I’ve had the opportunity to experience certain companies that, because of their cultures, I did not think would be the best fit for me.”

Although he’s aware that it’s going to take some time for him to learn the ropes after leaving college, Eidelbus is keen to make a difference at the company where he does decide to work full-time. “I want to be given the opportunity to work hard and make an impact,” he says. “I have interned with two private companies and noticed some advantages of the private structure. It gives the employees more leeway to introduce their creativity into their work; you have more freedom – although that’s not necessarily restrictive to private companies.”

As the VP of administration for Gamma Iota Sigma at his college, Eidelbus has been actively involved in promoting risk management to his fellow students. When students are made aware of the opportunities and career progression that are possible in insurance, interest levels soar.

“That’s why it’s so important for insurance companies to get their name out there, whether that’s a carrier, wholesaler or brokerage,” Eidelbus says. “Organizations should spend time with the millennial generation – that will make a huge difference in attracting new talent.”

Being adequately compensated is also a top priority for Eidelbus, and he expects to be paid based on his performance. But just as important is the ability to progress and develop within the company where he chooses to work. “As I spend more time in the workforce, as I learn my craft and become more specialized, I expect to be given more responsibility, and I look forward to moving up,” he says. “Being given the opportunity to take on new ventures that are outside of my comfort zone will definitely help me to stay engaged and make me feel valued. I also expect to receive feedback on my strengths and weaknesses and advice on how I can develop and improve.”

“I wouldn’t want to start my career somewhere I know I’m not going to be able to move ahead” Molly Belmont, Temple University student takes someone with no insurance knowledge and puts them on path to a prosperous career in the insurance industry.

“The development program has been very helpful to both the industry and the individuals, who get on an exciting career path,” Moore says. “It gives individuals a clearer understanding of the opportunities to grow in our business, and it’s totally transparent.

I think that’s what millennials want to see.

The industry has come a long way in making

itself appealing to this generation over the past few years, but I do think there’s still room for improvement.”

Bouchard echoes Moore’s thoughts: “People used to say that you’re either born into or you fall into the insurance industry, but that’s no longer the case. The millennials I see completing internship and mentoring programs are passionate about insurance, and I think the industry has a bright future with these people filling the gap.”

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RESULTS ANNOUNCED OCTOBER 2016

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5/08/2016 AMAM 5/08/2016 4:31:01 2:02:45

FEATURES

COMMERCIAL AUTO

Into high gear Comprehensive insurance coverage plays a crucial role for any organization in the commercial auto and garage industry. So how can brokers get into the fast lane in this space of the market?

ROBUST COMMERCIAL auto insurance is paramount for any organization that owns, leases or rents cars, trucks and other vehicles.

However, an organization with employees who operate company vehicles that are leased, rented or owned also comes under the commercial auto umbrella. The financial costs associated with a commercial auto accident or event can severely impact a client’s business operations, especially if an employee was found to be at fault or if the vehicle was damaged or not road-worthy at the time of the accident.

Even an organization with employees who drive their own vehicles to conduct business can be at risk if one those workers has an accident or business-related incident during work hours.

The coverage challenge An incident on the road shouldn’t have to lead to a breakdown in your client’s business activities. A good commercial auto policy will help a client pay for damaged property as well as medical expenses. Damage to all areas of the vehicle should also be covered

THE US CAR RENTAL MARKET AT A GLANCE ENTERPRISE HOLDINGS Includes Alamo Rent-A-Car, Enterprise Rent-A-Car, National Car Rental • Cars in service (2015): 1,116,828 • US locations: 6,250 • Estimated revenue (2015): $13.88 billion HERTZ Includes Dollar Thrifty, Firefly • Cars in service (2015): 499,100 • US locations: 5,410 • Estimated revenue (2015): $6.35 billion AVIS BUDGET GROUP Includes Payless • Cars in service (2015): 365,000 • US locations: 3,250 • Estimated revenue (2015): $5.45 billion

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FOX RENT A CAR • Cars in service (2015): 19,000 • US locations: 19 • Estimated revenue (2015): $225 million ADVANTAGE RENT-A-CAR • Cars in service (2015): 30,000 • US locations: 50 • Estimated revenue (2015): $325 million ACE RENT A CAR • Cars in service (2015): 11,000 • US locations: 65 • Estimated revenue (2015): $100 million

so that if an accident or vandalism does occur, your client will be able to continue their day-to-day operations with minimal business interruption. But what can brokers do to help their clients in the commercial auto space get the coverage that suits their specific needs?

“Brokers should pay close attention to contractual provisions at the front end of the submission process, and also know that a comprehensive submission helps get the file to the top of underwriter’s stack,” explains Chris Moulder, vice president and broker at Worldwide Facilities. “A good submission includes things like safety information, driver hiring guidelines, motor vehicle records and as much supplementary information as possible to make the underwriter comfortable with the account.”

The commercial auto space can be a lucrative one, but according to Moulder, there are a fairly limited number of monoline auto markets available. This can create turmoil when segment results are not favorable. “In times when segment results aren’t good, we do see underwriters come and go from this space,” Moulder says. “But for those brokers with patience and technical knowledge, who remain as a stable source for their clients, this can definitely be a lucrative focus area.”

Disappointing segment results in the commercial auto space have led certain carriers to discontinue new business writings. As a result, certain classes are having a tough time finding coverage.

“Log haulers and oil & gas providers are two subclasses that have been hit pretty hard,” Moulder says. “It’s tough for brokers to find a home for some clients who were traditionally placed with a standard market.

We’re seeing some transportation classes being forced to move toward specialty or E&S wholesale markets, which changes the pricing scheme quite a lot.”

To become successful in commercial auto and garage insurance, Moulder advises

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brokers to give sustained focus to the space and treat it as a true growth segment.

“Brokers need to go all in and really get to know what the submission requirements look like, because they can be a little more onerous than a general liability submission,” he says.

“Brokers should always know of any contractual provisions that their client may have – for example, some may require that owned autos, hired autos and non-owned autos be covered for the contract terms. But unfortunately, given the upheaval in the market, some carriers are only willing to offer a scheduled autos approach.”

Garage insurance Garage insurance, which combines auto and general garage liability, covers liability associated with garage-type operations, such as repair shops, new and used car dealerships, motorcycle and RV dealers, and collision shops. Although garage insurance is crucial

“Garage insurance is highly specialized, even in terms of the market appetite and what can fit into the program, so if you’re targeting this space, it’s important to have a player in the class” Patricia Roth, Worldwide Facilities to these types of businesses, most retail agents and brokers have a limited knowledge of the product.

“Oftentimes we that find retail agents are either not comfortable with the product or they don’t understand it; it’s a hybrid form, and the specialization of that causes agents to shy away,” says Patricia Roth, senior vice president at Worldwide Facilities. “That agent recognizes there is an exposure but doesn’t

know exactly how to go about securing the coverage, what the nuances of the coverage are and how the pricing works.”

Due to similarities in verbiage, agents who are not specialists in the space often confuse garage liability insurance with garage keeper’s liability. Most retail agents don’t experience a large concentration of business in the garage space, so they don’t see the need to get educated or specialize. “We recommend that

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FEATURES

COMMERCIAL AUTO

US TRAFFIC ACCIDENTS

BY THE NUMBERS

2.31 million Number of people injured in motor vehicle crashes in 2013

$1 trillion Estimated cost in lost productivity and loss of life due to motor vehicle crashes in 2010

$3,231 Average auto claim for property damage in 2013

$15,443

retail agents partner with a wholesaler who is willing to impart as much knowledge as possible,” Roth says. “We’ve recognized that the insurance community does not do a lot to educate brokers and agents on this matter, and there are no CE classes available, so we find ourselves trying to educate retail agents on garage liability.”

For agents who want to expand their garage business, Roth advises they first get informed about the major players in the space. Taking this step allows retail agents to be fully aware of the business they’re able to go after before they make any commitments.

“It’s highly specialized, even in terms of the market appetite and what can fit into the

a general liability policy rather than an auto policy, and in the long run, the frequency and severity of auto accidents may decrease as a result of automated braking and lane assist systems.”

Crew believes advances in technology will continue to change the landscape of the commercial auto space in the long-term.

“As with any new market, changes will start slowly, with market-leading insurance companies and business entities, but the pace will likely increase as older vehicles are replaced and the cost of these technologies becomes more affordable,” he says. “Agents and brokers who embrace this new technology will have an opportunity to guide

Average auto claim for bodily injury in 2013

$3,144 Average collision claim in 2013

$1,621 Average comprehensive claim in 2013

“Agents and brokers who embrace autonomous vehicle technology will have an opportunity to guide their clients through this transition”

T

Dan Crew, EMC Insurance Companies WHO PAYS FOR CRASHES?

program, so if you’re targeting this space, it’s important to have a player in the class,” Roth says. “Underwriters are more than happy to partner and explain the coverages, so agents can gain a lot of information that way.”

Embracing change

Private insurers: 50% Individual crash victims: 26%

Third parties such as uninvolved motorists delayed in traffic, charities and healthcare providers: 14% Federal revenues: 6% State and local municipalities: 3% Sources: National Highway Traffic Safety Administration; ISO, a Verisk Analytics company

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Expected to be a common sight on our roads in the next decade, autonomous vehicles represent the biggest change in automotive manufacturing for a long time. But what sort of challenges and opportunities will the introduction of self-driving cars create for brokers and agents?

“Autonomous vehicles will change auto insurance in many different ways,” says Dan Crew, vice president of underwriting at EMC Insurance Companies. “Liability related to the autonomous vehicle may be covered by

T

their clients through this transition, which will create opportunities for them to expand their client base and grow their business.”

Due to the current flux in the market, an agent or broker who sells solely on price cannot expect to see significant growth in their book. Instead, brokers and agents should provide clients with critical risk management techniques and educate them on loss control safety features, Crew advises.

Those who provide that added service have a good chance to become leaders in this space.

“Agents and brokers who become leaders in commercial auto will have opportunities to provide expertise and critical risk management techniques to clients as the market struggles with profitability and new technologies change the way auto insurance is being underwritten,” he says.

H a t n

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THE BEST IN

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5/08/2016 5:01:56 4:50:36 5/08/2016 AMAM

FEATURES

AGENCY INSIGHT

Exceeding expectations Higginbotham has been a pillar in the Texas insurance market for 68 years.

President and CEO Rusty Reid talks to IBA about how this once small brokerage has evolved into one of the largest firms in the nation IBA: Higginbotham has been recognized by Texas Monthly as one of the best companies to work for in Texas.

How do you support the success of your producers and employees?

Rusty Reid: The foundational, singular thing you can point to is employee ownership. Everyone in our firm either owns stock directly, or they participate in our profit incentive plan. That really creates alignment between those who are out in the production force and those who are supporting the producers. We are very much what I describe as a “performance-based company” – when we experience success, so do the employees because they benefit as owners of our firm.

Our mission statement is to “exceed expectations” – of our employees, clients, carriers and communities we serve. We really do take all that to heart and make sure we always keep that first and foremost in all our interactions.

IBA: How important is the next generation to Higginbotham?

RR: Youth is a great thing at Higginbotham.

We bring in young professionals every single year, typically twice a year, and not only do they bring with them fresh energy, they also bring new ideas, new innovations, etc. We are very intentional about growing our firm, so we have a strategy to grow it – we are not

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just going to sit back on our laurels. We are not going to overwork our people, either. We are going to continue to add talent to supplement and support our growth. The fact that we invest in youth is a bet we have made, and that’s a bet we have won, and it has aided us as we continue to pursue our growth.

IBA: How are you attracting and growing that new talent?

RR: We have what we describe as our “newbie program”; it’s where we recruit individuals out of college. For those newbies who join us right out of college, we have Higg U, and we actually developed our own curriculum for those newbies that goes above and beyond just getting their license. In Higg U, they develop coverage expertise and sales principles, and then they mentor under one of our seasoned producers.

IBA: Tell us about F.O.R.C.E. What does it stand for?

RR: F.O.R.C.E. stands for Family of Responsible Caring Employees. Every employee is a member of our F.O.R.C.E. and has opportunities to participate in volunteer community development projects. We also have our Higginbotham Community Fund, which we established in 2011. That is a private foundation where every office has representation on the Higginbotham Community Committee.

In each office, people have the opportunity quarterly to submit a request for a grant to go to their favorite cause. The only rule is that if you contribute to the fund, then you have a right to make a request for something that’s important to you in the community. Since starting the fund in 2011, we have supported about 400 different nonprofits across the state with more than $700,000 in grants, and it’s

ABOUT HIGGINBOTHAM • Founded in 1948 by Paul C. Higginbotham after he returned from military service in World War II, Higginbotham now has 773 employees across 25 offices, including its headquarters in Forth Worth, Texas, servicing all 50 states and internationally.

• Leadership team: Rusty Reid, chairman, president and CEO; Jim Krause, CFO; Chris Rooker, COO, managing director of commercial lines; Michael Parks, managing director of financial services; Jim Hubbard, managing director of employee benefits; Mary Russell, CAO, managing director of personal lines; Morgan Woodruff, managing director of commercial lines

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HIGGINBOTHAM HISTORY

1948

Paul C. Higginbotham founds Higginbotham in Fort Worth, Texas

1962

Paul’s nephew, Bill Stroud, takes over management of the company

1989

Rusty Reid becomes president and CEO, implements firm’s employee-ownership model, and recruits managing directors Jim Hubbard and Michael Parks to build the firm’s employee benefits practice

“We are very much a what I describe as a ‘performance-based company’ – when we experience success, so do the employees because they benefit as owners of our firm” truly a corporate initiative. We have found that it has become a part of our culture and something our employees support significantly.

IBA: Can you describe what Higginbotham’s Day Two Services are and what makes it unique?

RR: Most people in the mid-market sector kind of do what we describe as “day one work.”

They go out, they try to get the best cost, coverage and cash flow for their clients, and then they see them at next year’s renewal. Our belief is that after you deliver the renewal, that’s when the real work begins, and that’s what we call Day Two. There are two components to Day Two. One is risk management. We have a team of our own in-house loss control people, in-house

contract review people and in-house adjusters.

We have online technology tools that help us do data mining to really help provide a drilldown capability on claims.

The second is employee benefits, with our own in-house wellness directors and our own in-house attorney who came from the Department of Labor, who was in charge of enforcing the ACA – so we thought, wouldn’t it be great to have him on our team and support our clients as they navigate through Obamacare and what it may entail?

We have our own in-house communications department to help our clients in branding their benefit programs. We bundle all that up and refer to that as our Day Two Services. That has really given us a leg up on the competition in the markets we serve.

1998

Denton Insurance Center in Denton, Texas, merges with Higginbotham, becoming its second office

2001

The company relocates to its present headquarters in downtown Fort Worth

2008

After 60 years in the business, Higginbotham initiates an aggressive statewide growth strategy

2011

The firm establishes the Higginbotham Community Fund to provide grants to nonprofit organizations throughout Texas

2016

Today, Higginbotham is ranked as the largest Texas-based independent broker

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FEATURES

NONPROFITS

The profit in nonprofits Brokers and agents who manage to penetrate the nonprofit and social services space have a good opportunity to build a base of loyal, lifelong clients NONPROFIT AND social services agencies both play crucial roles in communities across the country. From delivering food to the infirm to providing safety and protection for at-risk youth, these organizations are run by people who are driven by the desire to help others. In servicing this complex segment of the market, and helping nonprofits and social services agencies to operate with adequate coverage, brokers have the opportunity to do

their part for the greater good. And in addition to playing an integral role in the communities in which they live and work, brokers also have to chance to boost their bottom line.

Budgetary restrictions Specializing in nonprofits requires brokers and agents to cover everything from large social service agencies to museums, food banks and agencies providing in-home care to

THE NEED FOR D&O COVERAGE The chart below, which highlights data gathered over a 10-year period by the Nonprofits Insurance Alliance Group, illustrates the relative risk and cost of D&O claims for nonprofit and social services agencies.

ALLEGED WRONGFUL ACTS GOVERNANCE

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FIDUCIARY

EMPLOYMENT PRACTICES

Percentage of all claims

5%

1%

94%

Number of claims

117

51

1,346

Largest claim

$775,000

$82,000

$938,000

Average claim

$23,000

$6,000

$33,000

Defense cost as % of total

75%

86%

45%

seniors. Each nonprofit has its own unique set of needs and requires a level of patience and attention that brokers and agents may not be used to providing.

Nonprofit and social services agencies often have smaller budgets than other organizations, which, according to Riley Binford, executive vice president at Charity First Insurance Services, has a distinct impact on their approach to purchasing insurance coverage. “Also, since 2008, nonprofit and social services have really felt a pinch from federal, state and local grants, and overall donations, so they’ve had to adjust to working with shrinking budgets,” Binford says.

“Unfortunately, with these tighter budgets, in my experience, it seems that the number-one coverage affected is directors & officers [D&O], including employment practices liability [EPLI]. A nonprofit often will either forgo purchasing the coverage or drop it if they carried it before.”

Whether they’re either reluctant or unable to spend the dollars to purchase D&O and EPLI products, nonprofits and social services are missing out on bargain policies that cover exposures they really should be addressing.

“Umbrella liability is another coverage that can be a hard sell to nonprofits with tight budgets,” Binford adds.

Although some of the risk exposures of nonprofits are common and experienced by most organizations – property, general liability, auto and workers’ compensation – others are not so obvious. With these less common risks, the decision not to purchase D&O and EPLI can lead to significant financial harm.

“Probably the most common D&O claim is mismanagement of funds and/or directed donations,” Binford says. “And, if you have employees and you elect not to carry EPLI, you are exposing the organization to employment practices claims such as wrongful termination, harassment and discrimination.”

Any agency that undertakes work with

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minors or adults with disabilities should, without question, be advised to carry sexual abuse and molestation coverage. “Also, if you are a nonprofit with residential exposures or bus and van exposures that expose several lives to injury at one time, umbrella liability coverage is essential, as one bad loss could easily exhaust the underlying limits,” Binford says.

Communication and collaboration Although this space of the market may present some unique challenges for brokers, it is not without its benefits. The nonprofit

industry is renowned for its communication and collaboration between organizations, so any broker or agent who goes the extra mile will be recognized by the client. “The great thing about nonprofits is that they are fairly loyal to their agents if they feel they have been well taken care of,” Binford says.

“The best tactic to differentiate, fuel growth and drive retention is for agents to become their nonprofits’ risk management resource.

In this capacity, they should provide guidance for things like child safety, sexual abuse controls and concussion management.”

Binford believes it’s imperative for brokers

to provide guidance and advice about the use of waivers and hold-harmless agreements in order to help their clients effectively manage risk. “Educational seminars for the nonprofit’s key managers and employees should also be considered,” he says. “The broker should avoid selling on price alone and concentrate more on the risk management side.”

Randall Hedlund, program director at Care Providers Insurance, believes that working in this space of the market gives brokers rewards beyond the opportunity to sell insurance products. “Unique to the business is the fact that you’re helping organiza-

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FEATURES

NONPROFITS

NONPROFITS AND SOCIAL SERVICES FAST FACTS More than 1.5 million nonprofit organizations are registered in the US, including: 1.09 million public charities 105,030 private foundations 368,337 other types of nonprofit organizations, including chambers of commerce, fraternal organizations and civic leagues In 2013, public charities reported more than $1.74 trillion in total revenues from the following sources:

Contributions, gifts and government grants 21% Program service revenues, which include government fees and contracts 72% Other sources, including dues, rental income, special event income, and gains or losses from goods sold 7% Public charities reported more than $3 trillion in total assets in 2013 The number of nonprofits registered with the IRS increased by 2.8% between 2003 and 2013 The nonprofit sector contributed an estimated $905.9 billion to the US economy in 2013, or 5.4% of the country’s GDP Source: National Center for Charitable Statistics

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“The great thing about nonprofits is that they are fairly loyal to their agents if they feel they have been well taken care of ” Riley Binford, Charity First Insurance Services tions who help people with particular needs; you’re really giving back to the communities in which you operate,” Hedlund says. “I know a number of brokers who are not only great agents, but great partners to nonprofits and social services, too. They help their clients by sitting on boards, providing volunteer labor and helping these organizations operate more efficiently.”

The reputation factor Working with nonprofits and social services agencies can also be a great brand-building

process. Being attached to a philanthropic agency helps a broker stand out from the crowd and adds a layer of trustworthiness to their value proposition. “Many banks have insurance arms and have worked with nonprofit organizations in order to become good stewards to their communities in providing lending, insurance and other financial services,” Hedlund says. “It’s all about being part of the community. You’re helping people grab their bootstraps and pull themselves up. All of that has a very positive impact and is a very good image-builder for the

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people involved.”

Although their budgets are inevitably low, nonprofit organizations still have the ability to afford insurance products. In fact, these tight budgets make having comprehensive coverage all the more important.

Whereas a for-profit company may be able to pay out of pocket for a claim, the same scenario could be devastating for a nonprofit. Brokers have a good opportunity to gently inform and educate these clients that insurance is a necessity, not a luxury.

“To really help their clients in this space, brokers need to be familiar with nonprofit operations and the various services they might offer,” explains Vince Terlaje, president of NIF Pacific and national director of the Nonprofit Social Service Program. “There are tailor-made coverages for nonprofits, and fully understanding the unique coverages that are offered in this space is paramount for brokers’ success. This space has very unique exposures, and the broker must be able to identify the risks and then provide the solution.”

Because 2016 is an election year, uncertainty is in the air for nonprofits and social services agencies. It’s difficult to predict how the result will impact funding streams, but the hope is that organizations are not forced to consolidate, bringing about a reduction in the vital services that nonprofits provide to the public.

For brokers, too, the space is ever-evolving. Terlaje believes that all

“There are tailor-made coverages for nonprofits, and fully understanding the unique coverages that are offered in this space is paramount for brokers’ success” Vince Terlaje, NIF Pacific brokers should take advantage of automation tools in an attempt to find ways to reduce costs for themselves and their clients. “Brokers also need to be ready for the next generation of required coverages that occur in this niche insurance space,” he says. “In the same way that the need for cyber liability policies has seen a rapid increase, there are going to be other new and innovative coverages, and brokers should stay current on what is coming next.”

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CHANG ING WORLD

about to and brokers is ates rance agents stig The world of insurm. Insurance Business inve ld g wor radically transfoto do to thrive in a changin d and Casualty nee ion of Property what you Future: The Evolut

saying of the ution. the Agency are g today is not Insurance Distrib WHA Insurance agents are playin Producers at ago, specifically “The role that comfort zones. ding , 20 to 30 years goodbye to their e, Ore., is expan ob Hartman role they played cing,” says R based in Eugen and developing in risk selection and pri The agency, ercial lines . lines: cus on comm ffocus of the report its fo ont line of hor ffront n within those co-aut lizatio on the fr or specia buses, ffo used to be new areas of y had undery, for taxis and “The agent of a policy, insurance fo n o i pricing t a t r o and knew p , s n tra riting tions of homes very underw y, did inspec y, ity ity, rit example. gents who were ys Hartman. agents g authorrity says ” had ritin ss,” s writin have busine we , stayed the “Historically given that lization and they logy the customer, knew for that today, areas of specia techno used to their ’s a lot less need singly in small information y 50 “There Vince Ada, lines—and increa to more of a there,” says ys approximatel all personal g which emplo s are movin in what in task is director at WHA, ercial—carrier sit comfortably , where the You comm you can’t just r riting model or eight years. people. “But ation and answe black-box underw in the last five fill out an applic to 20 you have done to accurately industries.” business or 10 le the yees multip about have to learn additional emplo how you drive to 60 questions ly hired eight and the car and help the 50 WHA recent ons about you logies that will ers. questi enting techno s are it.” and is implem vely with custom it—and that’s sales by carrier t more effecti efforts direct interac or ting l ny compa up its marke Multichanne insurance, which also stepping ercial y, and auto ing al and comm The agency is increasing steadil of premiums, is becom sales in person for 70% s are also in order to grow measures to boost efficiency. says. Carrier is accounts ry d, Hartman matic of what lines, and is taking with the indust commoditize ence is emble insurance aggressively, WHA’s experi on advertising. and mid-size marketing more many small $6bn a year US. Many happening at carriers are ng more than across the brokerages prem ms were riven, spendi y personal auto, logy-d notabl of all P&C premiu lines, techno agencies and nt, indep ndent more efficie They In some with agents and brokers. written byy indepe are becoming ting and specialized. lines compe ercial ting. agents 2013, focused on comm new approaches to marke Shar Report rket Share Source: Market ping pendent Insurance depend T CHANNEL are also develo able hole in A.M. Best/Inde okers of America little choice.

Brokers the THE DIREC have punched a notice larger Agents & They may have economics of is growing Direct sales hole l,” signs that the the are unrave ing to “There auto, and model are beginn report, Agents personal 11 MBER 2013 | Co. & traditional agent ER/DECE ER/DEC sey NOVEMB a recent McKin according to

57%

IBAMAG.COM ISSUE 3.04

10 | NOVEMB

ER/DECE

MBER 2013

TOP

PRODUCERS P RODUCERS Find out who made the inaugural list of the industry's best producers GLOBAL REACH LLOYD'S CHAIRMAN ON THE INSURANCE GIANT'S AMBITIOUS GROWTH PLAN

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NEGOTIATE BETTER PROFESSIONAL LIABILITY LEARN THE SECRETS THE NEW RISKS THAT TO WINNING THE DEALS ARE LEAVING YOUR YOU WANT CLIENTS EXPOSED

• In-depth analysis of the latest issues affecting insurance brokers and agents • Expert columnists addressing aspects that impact your business • Exclusive interviews with the industry’s most important players • Our own rundowns of America’s best brokerages and insurers • Analysis of insurance industry reports and research findings • The latest changes in insurance legislation and what you need to do next • Industry photography of the key figureheads and insurance events

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PEOPLE

CAREER PATH

PIONEERING SPIRIT

Over the past two decades, Nicole Goodwin has played a key role in developing pioneering insurance products targeting emerging fields

1999

Goodwin started her career as a lawyer in the tech hub of San Francisco during the dot-com boom and bust era, specializing in applying intellectual property concepts to the internet “It was an interesting time. The law was trying to figure out how to apply a lot of older statutes to an emerging digital world; it was an exciting time to work on aspects of the law that weren’t already figured out 200 years ago”

BECOMES A LAWYER IN THE TECH CAPITAL

2009

VOLUNTEERS FOR THE ARTS Upon her return to the US to take up the position of head of casualty claims in Hiscox’s New York office, Goodwin accepted a board appointment for the local chapter of Volunteer Lawyers for the Arts “It did speak to a passion of mine – the arts, and facilitating artists doing good work. It was a way of giving back to people who might not have the means to access [a lawyer] in the general marketplace”

2011 TAKES ON A NEW ROLE AT HISCOX Goodwin reached new career heights with her appointment as head of claims and chief claims counsel, a position that included the development and management of a team servicing a range of specialist SME insurance products and claims, including technology, cyber/privacy, media and entertainment, and terrorism “This position truly sparked my interest in the underwriting and claims process. Being able to develop and manage a team that could address claims for a variety of business lines was extremely rewarding”

2015 BECOMES CHIEF UNDERWRITING OFFICER Appointed last year as CUO for the New York office, Goodwin is now responsible for guiding and leading a team of highly specialized underwriters “This role presented me with an opportunity to immerse myself in all aspects of the business. The insurance market presents an ever-changing landscape, and it has been exciting to spot new opportunities for the organization”

2004

MOVES TO A NEW INDUSTRY (AND CITY) Goodwin joined Hiscox as divisional counsel for the company’s pioneering aerospace, technology, media and telecoms division in London “I like the entrepreneurial spirit of developing something new – taking a lawyer’s analytical rigor and applying it to emerging risks to create solutions for the marketplace. I sold my apartment and moved 6,000 miles to a country where I knew few people to embark on a very different career trajectory. It [was] pretty exhilarating”

2010 GIVES BACK TO THE COMMUNITY Expanding her volunteer efforts, Goodwin further embraced social activism with a position on New York City’s Community Board 4, which acts as a liaison between a neighborhood and its councilperson “I’m very community-oriented; I think it’s important to have balance and to find ways of giving back. It was timeconsuming but very rewarding work to be involved in”

2013

MAKES THE LEAP TO PARTNER As a partner at Hiscox, Goodwin found herself part of a group that comes together across multiple functions and multiple geographies to collaborate, counsel, brainstorm, advise and constructively challenge on the emerging opportunities, risks and strategic direction of the organization

“It was really flattering to have the opportunity to have that level of input within the organization, to be part of that conversation at such a high level.

That was a big turning point in my career” www.ibamag.com

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PEOPLE

OTHER LIFE

TELL US ABOUT YOUR OTHER LIFE E-mail iba@keymedia.com

ON A ROLL For roller derby jammer Kendra Kimball, the fastmoving sport is as much a passion as it is a pastime A BUSINESS systems analyst with Liberty Mutual Insurance and longtime skater – on both ice and pavement – Kendra Kimball encountered roller derby for the first time during her junior year of college and was instantly hooked.

The speed of the sport is a definite lure, as is the opportunity “to get out some pent-up aggression,” she laughs. But for the Pacific Northwest native, who goes by the derby sobriquet Mad Hattie, the real draw seems to be the community that clusters around her team, the Trampires, one of four in the Dockyard Derby Dames league.

“The people it attracts – they’re incredible!”

Kimball says. “Women from all walks of life and all ages participate. It’s a very accepting sport.”

It’s also a very demanding sport, one that requires two-hour practices three times a week and monthly all-day bouts, not to mention the numerous necessary ancillary activities, such as fundraising and postering, associated with keeping the volunteer-run league functioning.

But Kimball feels all the effort is worth it. “I haven’t found anything else that calls to me in the same way.”

10

Number of skaters on the track at a time (two jammers, eight blockers)

64

30

Minutes in each of the two periods that make up a bout

35

Number of bouts in which Kimball has competed

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Expect big things in workersâ&#x20AC;&#x2122; compensation. Expect to save a third of your clients 30% or more. Most classes approved, nationwide.

For information call (877) 234-4450 or visit auw.com/us. Š2016 Applied Underwriters, Inc., a Berkshire Hathaway company. Rated A+ (Superior) by A.M. Best.

Insurance plans protected U.S. Patent No. 7,908,157.

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