Insurance Business Canada 5.03

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ISSUE 5.03

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CONTENTS

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UPFRONT 04 Editorial

The very real opportunities behind the risks of fake news

06 Statistics

24

Expect more from your insurance carrier FEATURES Expect more from your insurance carrier AVIVA – HOME OF INNOVATION

BROKERS COVER STORY

26

An insider’s view on the insurtech space from Ben Isotta-Riches

2

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How technology is opening up new risks across multiple sectors

12 Intelligence

New appointments, new products and the latest acquisitions

How insurance is learning to stop worrying and love insurtech

38

BROKER INSIGHT Reith & Associates’ Dan Reith explains the strategies behind over a century of success

18 Opinion

The disruptors are coming – adapt and survive

FEATURES 42 Feel the burn?

A guide to chilling out, instead of burning out

48 Lean management

Shari Douglas from RSA on redefining customer service

Carol Barton, president of AIG Multinational, discusses cross-border business and the changing global landscape

20

10 News analysis

16 Technology update

FEATURES

Commercial General Liability Cyber Risks Insurance Commercial General Liability Directors and Officers Liability Cyber Risks Insurance Environmental Impairment Liability Directors and Offi cers Liability Life Sciences Environmental Impairment Liability Professional Life Sciences Liability Property/Inland Marine/Cargo Professional Liability www.insurancebusiness.ca Umbrella and Excess Liability Property/Inland Marine/Cargo

Is terrorism coverage now a necessity for all businesses?

Where do MGAs stand in the face of disruptive insurtech?

Insurance Business Canada identifies the Canadian insurance industry’s best and brightest

INDUSTRY ICON

08 Head to head

14 MGA update

ELITE BROKERS 2017

PEOPLE

The digital needs of Generation Y and how to satisfy them

PEOPLE 44 Career path

40

HelpingFEATURES brokers with effective insurance solutions 1966 TRIBE HelpingTHE brokers withsince effective

SPOKEN insurance solutions since 1966 Calgary HAS The value in building diverse Montreal Calgary business networks Toronto Montreal Vancouver Toronto

How Alan Jay Kaufman rose to the top, and started giving back

47 Other life

Stampeding along with Kat Macaulay

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UPFRONT

EDITORIAL

Fake news: real problem W

as it really more than 100 days ago?

The idea of Donald J Trump leading the USA as its president has barely sunk in for most of us, yet he’s already spent more than 100 days in world politics’ ultimate hot-seat. On the arrival of that historic milestone, he renewed his promises on taxes and healthcare – but also took the opportunity to reiterate another key theme of his reign to date, namely to slam the media for allegedly misleading Americans with what he brands “fake news”.

Whether you agree with the media’s interpretation of President Trump’s leadership or not, there is no getting away from the fact that reputational risks have become a key topic globally – and especially in the world of insurance.

It was in April that Aon released its Global Risk Management Survey 2017, which highlighted that damage to reputation/brand is now perceived as the top-ranked risk among 1,843 respondents at public and private companies around the world.

Fake news, which started as a way to influence elections on social media, has begun to spill over to the corporate world “Over the past few years, while defective products, fraudulent business practices or corruption continue to be key reputation wreckers, new media technologies have greatly amplified their negative impact, making companies more vulnerable,” the Aon report states.

“In the age of Twitter or viral videos, damage to reputation could occur because of an inappropriate tweet by an executive, or a video by an employee complaining about sexual harassment or discrimination. On a related note, fake news, which started as a way to influence elections on social media, has begun to spill over to the corporate world.”

That spillover means that businesses can no longer rely solely on the usual forms of risk transfer and risk management – instead they require new ways to deal with emerging complexities. For the insurance world, of course, this creates an opportunity – fake news and similar reputational threats have created a risk that needs to be managed effectively.

Among those who will be fastest to adapt are the Elite Brokers we shine the spotlight on in this edition of Insurance Business. They have proven to be consistently forward-thinking and ahead of the pack when it comes to moving quickly to address emerging threats – and as a result their businesses have thrived. Their stories can provide inspiration to us all, as we look to provide real, tangible solutions in a world of problems that is anything but fake.

The team at Insurance Business Canada

www.insurancebusiness.ca EDITORIAL Managing Editor Paul Lucas Writers Lucy Hook, Libby Macdonald, Tim Garratt, Joe Rosengarten, Lyle Adriano Copy Editor Bruce Pitchers

CONTRIBUTORS

Janine Garner, Karen Gately, Peter Kochenburger, Warren Kennaugh

ART & PRODUCTION Design Manager Daniel Williams Designer Joenel Salvador Production Manager Alicia Chin Traffic Manager Monica Lalisan

SALES & MARKETING National Account Manager Eric Langille Associate Publisher Trevor Biggs General Manager, Sales John Mackenzie Marketing and Communications Melissa Christopoulos Project Coordinator Jessica Duce

CORPORATE President & CEO Tim Duce Office/Traffic Manager Marni Parker Events and Conference Manager Chris Davis Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil Global CEO Mike Shipley Global COO George Walmsley

Editorial Inquiries paul.lucas@keymedia.com Subscription Inquiries subscriptions@keymedia.com Advertising Inquiries eric.langille@kmimedia.ca

KMI Media 312 Adelaide Street West, Suite 800 Toronto, Ontario M5V 1R2 tel: +1 416 644 8740 www.keymedia.com Offices in Toronto, Denver, London, Sydney, Auckland, Manila, Singapore, Bengaluru CMCA AUDITED

Insurance Business Canada is part of an international family of B2B publications and websites for the insurance industry Insurance Business America cathy.masek@keymedia.com T +1 720 316 0151 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 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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31/05/2017 10:59:08 5:37:22 AM 2017-03-28

UPFRONT

STATISTICS

Changing channels

A WORLD OF USER EXPERIENCE Globally, members of Generation Y are likely to have fewer positive experiences with insurance companies across the board. That’s primarily due to high expectations and a pronounced preference for digital channels, pointing to gaps in service.

Gen Yers are on the rise, and they’re not satisfied with the status quo when it comes to insurance YOUNG, MOBILE and attuned to a world of constant digital interaction, Generation Y is emerging as a new kind of customer. According to the latest World Insurance Report from Capgemini and Efma, fewer Gen Y customers reported a positive experience with their insurance carriers than their elders.

Perhaps most important is the gulf between what Gen Y customers expect and what

traditional insurers provide. This generation is characterized by a desire to engage more frequently, with a preference for twice as much contact as other demographic segments, particularly in newer channels, such as social media. That opens the field to new competitors, especially as Gen Yers say they’d be more likely to consider purchasing insurance from a tech brand like Apple or Google, if offered.

NORTH AMERICA

100% 80% 60% 64.7% 40% 40.3% 20% 0% Positive experience in traditional channels

25+%

40.5%

of the global population is part of Gen Y

30.9%

of Gen Y customers consider themselves to be strong technology users

of non-Gen Y customers consider themselves strong technology users

36.2%

51.6%

Positive experience in digital channels

23.4%

of customers worldwide are likely to purchase insurance from a tech company, if offered

Gen Y

Others

Source: World Insurance Report 2016, Capgemini and Efma

REACHING OUT

THE DIGITAL GENERATION

Gen Y consumers communicate with their insurers more often across all channels, though they do reach out more frequently online.

Gen Y customers have a clear preference for digital channels – they turn to social media to access insurance services up to two and a half times more often than other customers and use mobile more than twice as often as other customers.

Gen Y

Others

Gen Y

CUSTOMERS USING DIGITAL CHANNELS AT LEAST ONCE A MONTH

CUSTOMERS USING THE CHANNEL AT LEAST ONCE A MONTH Agent

27.8%

Phone

35.6%

North America

31.9%

15.5%

Internet (PC)

43%

Internet (Mobile) Social media 0%

10%

20%

30%

50%

Source: World Insurance Report 2016, Capgemini and Efma

6

17.3%

Developing Asia-Pacific 40%

56.7%

34.6%

Developed Asia-Pacific

32.1%

13%

32.1%

15.3%

Latin America

36.2%

16.2%

39.5%

20.4%

Europe

27.5%

Others

30.2% 53.2%

33.9% 0%

20%

40%

60%

80%

Source: World Insurance Report 2016, Capgemini and Efma

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EUROPE

DEVELOPED ASIA-PACIFIC

100% 80% 60% 56.6% 40% 34.6% 20% 0%

100% 80% 60% 40% 20% 0%

49.9% 29%

Positive experience in traditional channels

44.7% 29%

Positive experience in traditional channels

Positive experience in digital channels

LATIN AMERICA

DEVELOPING ASIA-PACIFIC

100% 80% 60% 59.3% 40% 20% 35.4% 0%

100% 80% 60% 48.8% 40% 20% 33.9% 0%

Positive experience in traditional channels

51.6% 36%

32.3%

47.3%

33.3%

Positive experience in traditional channels

Positive experience in digital channels

Positive experience in digital channels

40.7%

Positive experience in digital channels

Source: World Insurance Report 2016, Capgemini and Efma

THE LURE OF BUYING ONLINE

TECH TAKEOVER?

Digital migration is hardly the sole province of the younger generation – across all age groups, online and mobile channels were most likely to see increased usage for the purchase of primary insurance policies.

A quarter of Gen Yers in North America were willing to purchase insurance through a tech company, but that number was even higher elsewhere.

0.6%

1.5%

50%

32.2%

25.3%

14.2%

11.9%

11.8% 20.7% 8.8%

18.5%

9.9%

15.3%

37.5%

43.5% 13.2% 9%

30% 20%

13.1% 8.8%

10% 0%

Agent

Phone

Bank

Broker

Internet (PC)

Internet (mobile)

Social media Source: World Insurance Report 2016, Capgemini and Efma

25.2%

22.5%

37.1%

12.5% 14.1% 8.8%

17.3%

38.6%

40%

16.5%

Others

47.2%

0.7%

0.8%

Gen Y

Would you purchase insurance policies from a top technology brand such as Google, if offered?

North America

Europe

36.2%

1.6%

3.5%

Channel likely to be used to purchase or renew insurance policy in next 12 months (Others)

19.6%

2.1%

Channel used to purchase insurance policy (Others)

11%

2.1%

Channel likely to be used to purchase or renew insurance policy in next 12 months (Gen Y)

49%

Channel used to purchase insurance policy (Gen Y)

Latin Developed Developing America Asia-Pacific Asia-Pacific

Source: World Insurance Report 2016, Capgemini and Efma

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31/05/2017 5:37:46 AM

UPFRONT

HEAD TO HEAD

Is terrorism coverage now necessary for all businesses?

Terrorism insurance is essential for business clients in high-risk industries and locations – but what about everyone else?

Julian Enoizi

Reggie Gibbs

Geoff Stilwell

CEO Pool Re

Managing underwriter, security risks Starr Companies

CEO and managing director Beech Underwriting Agencies

Recent attacks have emphasized the terrorism threat we now face; the insurance industry needs to increase the uptake of cover and its scope. In many of these events, small businesses have borne the brunt of the costs – from street closures to loss of attraction – damaging the wider economy as a result.

These attacks have not been restricted to major cities or high-risk industries and locations. As high-profile sites become better defended, terrorists might turn their attention to less obvious and more exposed targets.

Ensuring that businesses have access to terrorism insurance cover is key to mitigating this threat.

The need for terrorism insurance, particularly that of the non-certified variety – i.e. not subject to TRIA – has become increasingly important in recent years, as threats have shifted from high-profile locations to targets that would not traditionally be considered high-risk.

Recent examples include attacks at the Pulse Nightclub in Orlando and at the Inland Regional Center in San Bernardino.

Low-level, lone wolf attacks have become even more prevalent in Europe.

Hence, regardless of the location, profile or industry class of business, the chance of becoming a target of, or suffering collateral damage from, an act of terror has increased.

Unfortunately, any act of terrorism, as we know, is totally random. Therefore, it doesn’t matter where a client is based or the type of business they are in – I would recommend terrorism insurance.

Quite simply, any client must think of the following: should an incident take place, who is going to pay back the mortgage or loans to the lender, or can I continue to trade?

All the lender is interested in is getting their money back – whether you can trade or not trade – and having the right cover will enable a business to continue to trade.

A CONSTANT THREAT Fifteen years after the September 11 attacks, the threat of global terrorism lingers, albeit in an altered form. The May incident in Manchester, England that killed 22 people and seriously injured dozens more outside an Ariana Grande pop concert is the type of lone wolf attack that typifies the changing face of terrorism. According to a 2016 report from Marsh, this change in the nature of terror attacks has seen a growing awareness of the need for organizations to assess their coverage for indirect losses stemming from business interruption risks. In the US, the passage of the Terrorism Risk Insurance Program Reauthorization Act in 2015, which extended the legislation until 2020, has increased the take-up rate for terrorism coverage embedded in property programs.

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We salute our great nation in its 150th year, and the generations of Canadians who continue to make it a place we’re proud to call home.

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Economical Insurance includes the following companies: Economical Mutual Insurance Company, The Missisquoi Insurance Company, Perth Insurance Company, Waterloo Insurance Company, Family Insurance Solutions Inc., Sonnet Insurance Company, Petline Insurance Company. ©2017 Economical Insurance. All rights reserved. All Economical intellectual property, including but not limited to Economical® and related trademarks, names and logos are the property of Economical Mutual Insurance Company and/or its subsidiaries and/or affiliates and are registered and/or used in Canada.

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UPFRONT

NEWS ANALYSIS

Technology gone bad Never mind the challenge of innovating within the industry – technology is opening up new exposures across multiple sectors, and insurance needs to take note

IT’S NOTHING new to say that technology is changing the world, but while much lip service is paid to how digital innovation is affecting the insurance industry internally, less is known about some of the new risks that technology is opening up in many lines of business.

Current issues range from the problem of connected devices and who will be liable for them in the future, to the network of cybercriminals using digital techniques to execute sophisticated scams.

“With the interconnectedness of the world, every company is becoming a tech company to a certain extent,” says Emy Donavan, Allianz’s global head of cyber.

From semi-autonomous cars to household

“What concerns me more are the non-tech companies that are now doing tech,” she adds, pointing particularly to product manufacturers that are starting to integrate connected technologies into their offerings.

The problem is exacerbated by the fact that there is a limited number of people who can advise on these products and the surrounding liabilities. Manufacturers of connected consumer products may end up facing major issues and product recalls if they are unable to get a handle on the vulnerability gap these devices open up, which can include the threat of hacking, as well as malware programs that can break devices.

“If, as an organization, you aren’t hardwired to think about [cybersecurity] exposures, you inherently won’t” Emy Donavan, Allianz appliances, connected devices are creeping into more and more people’s homes and lives.

But while many tech companies have a good understanding of some of the exposures these products can bring, just as many firms do not.

“Tech companies have this in hand, and I think actually they’ll be the ones that lead us down the way,” Donavan says.

10

As there is so much focus on speed to market and early adoption, companies may well be pushing out products without an understanding of the exposures they could possibly face.

“I think that companies that haven’t yet been forced to think about security aren’t yet,” Donavan says. “If, as an organization,

you aren’t hard-wired to think about those kinds of exposures, you inherently won’t.”

The potential shift in liability as a result of these devices’ exposures is yet to be worked out, and Donavan believes there needs to be far more communication between the insurance industry, its regulators and the technology community to figure out how they will respond to these challenges.

“Who ends up holding the bag?” she says. “I don’t know the answer to that – but I think people should start to think about how they want that to look.”

And it’s not just devices that are vulnerable – cybercriminals are now using technology to manipulate people in “a modern-day version of the old con scams”, says Greg Bangs, XL Catlin’s global crime insurance head.

www.insurancebusiness.ca

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31/05/2017 5:38:58 AM

CYBERSECURITY: THE CURRENT LANDSCAPE There will be as many as 20.8 billion connected devices in use worldwide by 2020.

The huge DDoS attack on global internet access in October 2016, which blocked websites such as Twitter, PayPal and Spotify, was conducted by hacking into hundreds of thousands of internetconnected devices.

Sixty per cent of US enterprises were victims of social engineering attacks in 2016.

The average loss from CEO fraud is $160,000, but some companies have been tricked into sending as much as $120m to offshore accounts.

Sources: Gartner Research, Guardian.com, ISMG & Agari, Federal Bureau of Investigation

Social engineering fraud – in which criminals gather information from social media platforms and company websites to

convince employees to transfer them funds.

CEO fraud is particularly rife in Europe, Bangs says, and is especially difficult to

“With the increasingly technologically superior capabilities of the fraudsters, it seems they are always one step ahead” Greg Bangs, XL Catlin use as psychological manipulation – is one of the hottest talking points in the crime insurance space. Two of the most common forms of scam are vendor impersonation, in which criminals impersonate a business vendor to reroute payments to themselves, and CEO fraud, where thieves pretend to be executives within the company and

protect against.

“This one is a little more insidious because the fraudsters are very good at using psychological pressure points,” he says, “so when they’re talking to the individual to try to convince them, they recognize right away what the right buttons to push are.”

Bangs says while these scams are happening “all the time”, the picture is still a little cloudy when it comes to coverage.

“It’s an interesting landscape; a lot of [insurance] companies don’t cover [social engineering fraud] at all because they’re not comfortable with it, so they stick with the standard crime coverage and say, ‘We don’t like that; it’s too exposed.’ ” Others, including XL Catlin, do offer coverage, but limits vary, as there’s still some hesitancy in the space as the risks continue to develop.

Loss-wise, Bangs says there’s been an “explosion” in the computer fraud and wire transfer area, which has insurers concerned.

“With the increasingly technologically superior capabilities of the fraudsters,” he says, “it seems they are always one step ahead of the good guys.”

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31/05/2017 5:39:03 AM

UPFRONT

INTELLIGENCE CORPORATE ACQUIRER

TARGET

PRODUCTS COMMENTS

Andrew Agencies

Waggoner Insurance

Three Waggoner Insurance locations rebranded as Andrew Agencies, expanding Andrew’s network to 19 total locations

Archway Insurance

Alliance Assurance

Transaction grants Archway Insurance nine new locations in New Brunswick, where Alliance was one of the major brokerages

Archway Insurance

DR Hayman Insurance

Acquisition of DR Hayman allows Archway to expand into Pictou County – a new area of business in NS

Caisse de dépôt et placement du Québec

USI Insurance Services

CDPQ is jointly acquiring USI with KKR & Co; deal would value USI at about $5.4bn including debt

Fairfax Financial Holdings

Allied World

Fairfax received a $1bn investment from OMERS to help with the definitive merger with Allied

Fairfax Financial Holdings

Tower

New Zealand insurer Tower agreed to sell all of its shares to Fairfax for approximately $186m

HUB International

Insurance Supermarket

ISI is a marketer connecting advisors with consumers; deal would allow HUB brokers a distinct edge

Zurich

Cover-More

Deal will see Zurich Insurance expand to become one of the three biggest global providers of travel insurance

Zurich purchases Cover-More for $740m

Zurich has announced that it has entered into a scheme implementation agreement to acquire travel insurance provider Cover-More.

The deal will see Zurich complete the purchase through its holding company, Zurich Insurance Company. Following the deal, the firm will expand to become one of the three biggest providers of travel insurance in the world.

Zurich will acquire 100% of the issued share capital of Cover-More, pegging the deal at approximately $740m.

Cover-More will continue to operate as a stand-alone entity and will retain its brand.

12

April Canada reveals financial services coverage

A new product from April Canada provides coverage for financial services professionals.

The coverage is for negligence or omissions in financial advice that negatively affects the investor, as well as cyber protection for sensitive banking data.

“With this type of client, because we’re looking both at the good side and the distressed side, we know these risks aren’t something that gets quoted very quickly; they’re not that half-hour turnaround time. There’s a lot of back and forth that goes along with this thing,” said Kent Pitkin, April Canada’s director of commercial lines.

Petline Insurance offers specialized product to guardians of adopted pets

Petline Insurance has collaborated with Nova Scotia SPCA to create a specialized product available to those who adopt a pet through the charity. Through Nova Scotia SPCA Pet Health Insurance, adopters can enjoy an initial eight-week free trial period.

The product will cover general claims, boarding kennel fees, hospitalization, medication, exam fees, and dental care. “Nova Scotia SPCA is a strong brand that has demonstrated longevity and trust, providing humane care to animals for 140 years,” said Petline divisional vice president Rod Cunniam.

www.insurancebusiness.ca

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31/05/2017 5:56:35 AM

PEOPLE Willis Towers Watson launches CyFly

Willis Towers Watson’s CyFly targets global airlines that could be exposed to major financial and reputational damage in the event of a network incident. CyFly includes extension of business interruption referable to third parties, cover for aviation regulatory fines, compensation in relation to specific cyber incidents, claims preparation costs cover, and network business interruption cover at a pre-agreed minimum value per flight cancellation.

Business interruption cover is also available for global distribution systems, baggage processing, aircraft maintenance, fuelling and catering and airport security.

Markel introduces trade credit business in Canada

Markel International launched its trade credit and political risk business in Canada. It will be underwritten by Markel Canada on Lloyd’s syndicate 3000 paper.

“We have strong links to the Canadian broking community and we are now able to meet the local needs of national and multinational clients,” said Ewa Rose, trade credit, political risk and surety division managing director. “We will work closely with our broker partners to offer their clients the full range of our trade credit and political risk solutions with the security of a Lloyd’s policy.”

Everest Re unveils multi-line, primary casualty offering

Everest Re has announced the launch of a multi-line, primary casualty offering. The new product will serve upper middle commercial clients within select industry segments, with loss picks between $250,000 and $1m. Christopher McKeon will lead the commercial casualty unit offering the coverage.

“Chris’ knowledge of the upper middle market space, his industry and client relationships and his marketplace reputation will be an asset to Everest as we launch our new commercial casualty unit,” said risk management group head David Sandler.

NAME

LEAVING

JOINING

NEW POSITION

Peter Braid

n/a

Insurance Brokers Association of Canada

CEO. Braid will oversee an association that represents over 35,000 P&C brokers

Adrian Hall

International Travel & Health Insurance Journal

Swiss Re

CEO. Hall was tapped to lead the company’s Canadian operations, to be based in Toronto

Tim McMahon

n/a

XL Catlin

Global chief underwriting officer for property. To administer the company’s global property insurance portfolio

Chubb Global Casualty

Chubb North America Major Accounts

Chief operating officer of the division. He will assist in overseeing day-to-day operations and help expand the company’s product range

Matt Merna

Geoffrey Kendrick

Zurich Financial Services

Berkshire Hathaway Specialty Insurance

Head of professional lines, Canada. Kendrick’s appointment coincides with Berkshire’s launch of a new professional lines product

Gord Rider

Chubb Insurance Company of Canada

Berkshire Hathaway Specialty Insurance

Senior marine underwriter.

Rider takes the same position he held at Chubb

Chubb North America

Chief operating officer, North America personal risk services.

She will be responsible for the growth of Chubb’s high net worth personal insurance division

Ana Robic

n/a

IBAC appoints former MP

Former Kitchener-Waterloo MP Peter Braid was appointed chief executive officer of the Insurance Brokers Association of Canada (IBAC) last February.

“I’m thrilled with the new role,” Braid said. “It’s a position that has national scope.”

Braid served as the parliamentary secretary for infrastructure and communities, and represented the riding of Kitchener-Waterloo for seven years as a Conservative MP until 2015. He served as director of operations at Sun Life Financial before his political career.

Brit named Swiss Re Canada CEO

Adrian Hall, a British national and Canadian citizen, was chosen to serve as Swiss Re Canada’s latest CEO in April.

“Appointing an executive of Adrian’s calibre demonstrates our commitment to both building our business and enhancing our client service in the country,” said Ivan Gonzalez, Swiss Re North America CEO. “He will be instrumental in the implementation of our primary and lead placement strategy, at a time when Canadian corporations are increasingly sophisticated and risk managers demand both domestic and multinational service capabilities.”

Hall has over 20 years of experience in the insurance industry.

www.insurancebusiness.ca

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UPFRONT

MGA UPDATE

Internet threatens insurance jobs Brokers may be forced into consulting roles, but where would this leave MGAs?

use the web as a way to shop for insurance.

New insurtech companies such as Lemonade offer insurance solutions through phone apps.

Insurers have also taken an interest in the potential of insurtech. Some of the major players – Economical Insurance, Allstate and Sun Life – have started to offer their own take on online insurance distribution. Others, like Aviva Canada and Allianz, have invested in insurtech start-ups to drive innovation.

So what does all of this mean for MGAs?

“[MGAs are] more interested in leading with the business opportunities, not the existing technology”

Although traditional brokerages continue to serve an important role in the insurance space, more small firms are taking out the middleman by directly purchasing insurance online.

“The traditional insurance broker, their days are numbered,” said Christopher Williams, Tokio Marine HCC CEO. “If you look at a smaller premium, SME-type business, it will be very soon where you can do that online.”

Williams thinks that the current roles of

NEWS BRIEFS

insurance brokers will be rendered redundant thanks to insurance technology, or insurtech.

“Smaller firms will soon turn online for their insurance needs, rather than relying on a broker,” he said. “Multinational firms, or those with niche risk profiles, will still require a broker to assist, but they will need to develop past transactional duties.”

Businesses, particularly young start-ups, are increasingly internet-savvy, and many would

Financial Horizons purchases Estate Financial

Financial Horizons has announced the acquisition of New Brunswick-based Estate Financial. Estate Financial president Andrée McLean and director of brokerage Joe Daley will remain in their current positions following the deal.

Financial Horizons president John Hamilton called it a “strategic step” in the group’s growth. McLean detailed that Estate Financial chose to sell since the company “required a more diversified product offering”, determining that Financial Horizons would be the best choice.

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Despite insurtech, MGAs will still be able to serve their current roles.

Insurance-Canada.ca founding partner Patrick Vice said that MGAs are “more interested in leading with the business opportunities, not the existing technology”. He said insurtech companies might have the newest tools, but MGAs still possess “the ability to engage users, utilize data and sophisticated algorithms, and produce business results.”

It also helps that MGAs are still approached by insurance companies to write coverage in provinces the insurers do not have a licence for.

So while brokers face big strong challenges, competent MGAs appear well-positioned to take on insurtech and thrive.

Beazley acquires Creechurch Underwriters

International insurance group Beazley has expanded its presence in Canada with the purchase of Creechurch Underwriters. Creechurch’s team of 30 will remain in their existing offices and will continue to be led by Phil Baker.

“Canada has a developed insurance market well suited to the specialist liability products that we offer,” said Beazley head of specialty lines Adrian Cox. “We have had a successful trading partnership with Beazley ever since we began in 1996. We are familiar with their people, products and culture. It’s a great fit.”

www.insurancebusiness.ca

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Q&A

Daina Jensen Chief compliance officer O2 INSURANCE SERVICES

Years in the industry 10 years Fast fact Jensen spent the formative years of her career with Delta-based Schill Insurance Brokers.

Insurance is still a people business What makes O2 Insurance different from other similar companies?

Are there any current trends that you think could affect the MGA space?

Having the Lloyd’s broker approval sets us apart from many other MGAs operating in Canada. O2 has the ability to wholesale products direct into the Lloyd’s market without the need of a London intermediary, increasing efficiency in securing terms from our supporting syndicates. We’ll also be able to assist our retail brokers with renewing, placing and amending their existing cover-holder contracts. In addition, O2 will be selective with the product lines we develop as well as our distribution strategy. We want to partner with our brokers and work with them on solutions to their challenges. This may come in the form of developing specialized programs for affinity partners or business segments, or increasing services levels by creating digital distribution strategies, or creating a value added service platform to complement our brokers’ needs.

One of the biggest trends right now is digital distribution and it will continue to grow in leaps and bounds. Some of the carriers/MGAs are doing a good job of it, while others are putting out large investments for little return.

O2 will deploy digital product distribution, but what will be key for us is to do it in partnership with our brokers.

Some of the domestic markets are selling direct to the consumer, not only eliminating the broker in the process but devaluing the services and expertise they bring to the transaction and their ability to generate revenue.

Insurance continues to be a people business; we can’t lose sight of the value of our brokers and their expertise.

What challenges do you think up-and-coming MGAs like O2 Insurance face?

One of the challenges an up-and-coming MGA faces today is really getting lost in the shuffle. There are so many new MGAs in the market that I can imagine it’s difficult for brokers to keep up with us. What will be key for O2 is our broker relationships, staying visible, creating true partnerships to support their initiatives.

We don’t just want to offer a product; we want to offer a service, and we want to be a go-to resource for our brokers.

IDC Worldsource reveals expansion plans

The Vancouver-based MGA IDC Worldsource has announced that it is looking to develop its business activities in Quebec. President Ron Madzia revealed during an advisors’ meeting that he is looking forward to opening another office in downtown Montreal. The expansion, he said, is a “response to the firm’s organic growth”.

Madzia added that IDC will focus part of its business development toward ethnic Chinese communities across Canada’s major cities, and the company considers Montreal to be a significant market.

How can MGAs remain relevant amid increasing consolidation among insurance companies?

I believe the consolidation of the domestic markets is actually increasing the need for MGAs. Most MGAs have a combination of both domestic and Lloyd’s capacity supporting their contracts and products they distribute.

The consolidation is forcing us to actually increase our reliance on Lloyd’s markets in order to meet the demands of our brokers. Additionally, many of the domestics are revisiting their appetites and underwriting strategies and the business they are willing to write is becoming somewhat homogenized.

That shift is driving the need for true outside of the box underwriting, which is often found in MGA operations.

Markel obtains the assets of Allsport

Markel has fully acquired Allsport Insurance Marketing; previously, Markel owned half of Allsport and underwrote all of its policies.

Allsport as a company will be dissolved, but its branding and staff will remain.

“This merger puts our combined strengths into a winning proposition for our brokers and policyholders,” said Gina Bennett, Allsport’s president. “It will allow the Allsport brand to have a presence in the Eastern and Atlantic regions.”

Bennett explained that the deal would allow brokers easier access to Allsport products.

Totten launches healthcare practice

Totten Insurance Group unveiled its national healthcare practice in April. Theresa Teixeira, EVP and chief underwriting officer, will head the healthcare team.

“We plotted our entry methodically with the right people and partnerships,” said Totten president and CEO Susan Murphy.

“Our brand will have superior underwriting, with a trained eye on mitigating losses.”

“Our approach is a holistic one,” added Teixeira. “By educating brokers and engaging with insureds, we can build a product that fits them.”

www.insurancebusiness.ca

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UPFRONT

TECHNOLOGY UPDATE NEWS BRIEFS Chubb offers identity management services

Chubb, in partnership with data theft expert CyberScout, has launched identity management services for its Masterpiece homeowners insurance customers in Canada.

CyberScout’s fraud specialists will guide consumers in three ways: identity theft recovery, defence and education on how to protect themselves.

“With over 26% of Canadians falling victim to identity fraud and almost 7% being victims of identity theft, we wanted to further our commitment to preserving our clients’ well-being and way of life by offering a resource to combat these threats,” said Paul Johnstone, Chubb Personal Risk Services Canada senior vice president.

AIG provides personal cyber insurance

AIG is now offering comprehensive cyber insurance under its personal coverage line.

Family CyberEdge will be made available to policyholders of AIG Private Client Group, which primarily serves high net worth individuals and families. The new product was modelled after AIG’s comprehensive CyberEdge Commercial Insurance policy.

The product offers coverage to customers who have been affected by threats such as cyber extortion and cyberbullying. The insurance covers expenses related to data restoration, crisis and reputation management, as well as reimbursement for cyber extortion and ransomware, among other things.

Lloyd’s to insure Amazon sellers Lloyd’s of London is now offering insurance to

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third-party sellers on Amazon.com, financially protecting sellers in the event they are suspended from the online shopping network and lose income as a result. The policies were rolled out in early March.

It was InsuraTech CEO Tim Craig who suggested the idea of the policy to specialty underwriters at Lloyd’s. He expects at least 2,000 Amazon policies to be sold this year.

The market has the potential to grow – there are two million Amazon merchants in the US, Bloomberg reported.

Desjardins rolls out connected home program

Under Desjardins’ new Alert program, customers get a free water, freeze and humidity detector. The device – created and supplied by smart home developer Roost – can be installed next to any water fixture where a leak may occur. The detector will send an alert to the user whenever it detects a problem.

“With the Alert program, we’re helping clients harness the power of technology to avoid [water damage situations] as much as possible,” said Alex Veilleux, Desjardins General Insurance Group vice president of innovation and strategic partnerships.

Online tool for brokers

Wawanesa Mutual Insurance has announced that it has rolled out a powerful new online tool for its brokers to utilize.

Developed jointly by both Wawanesa and IBM, BlueTrack will allow brokers to easily manage their portfolios online. Users can “access their dashboards to view summaries of their key performance indicators, such as commission, written premium, policy count, policy retention and earned loss ratio”, a release said.

The tool was launched earlier this year as a “first phase implementation”, Wawanesa mentioned in a release.

Tech acquisitions drive insurance sector To stay ahead of the curve, insurers are turning their sights towards acquiring insurtech start-ups Technological innovation is one of the trends driving the insurance industry. It used to be that insurers invested in technology primarily to improve distribution, policy administration, internal controls and security. Now, insurers can use innovations such as telematics, data analytics, wearables and social media to improve the way they engage with their clients.

New technologies also help reduce losses, allowing insurers to offer lower premiums.

“Insurers are beginning to shift focus from loss recovery to prevention/risk management and mitigation,” business law firm Blake, Cassels & Graydon said in an industry report.

The law firm explained that this is possible since insurers now have access to technology that enables them to remotely validate behaviours, as well as to predict, prevent and mitigate risk. The law firm also observed that there have been a number of mergers and acquisitions by the insurance sector.

“While many expected significant consolidation in the Canadian P&C insurance industry, instead we have seen a steady stream of more tactical, targeted deals,” the firm said.

Both trends are not mutually exclusive, the firm noting that insurtech start-ups are the hottest acquisitions as of late. Start-ups can come up with solutions that “improve pricing, enhance the customer experience and improve

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back-office processes, such as fraud prevention”, – things more established companies are looking to add to their repertoires.

Indeed, more insurers are jumping on the insurtech acquisition bandwagon than ever before; research from Accenture found that in 2016, 14% of insurtech deals featured an insurer or its strategic venture arm – in 2015 that figure was 12%, and in 2014 only 3%.

The research also found that over half (56%) the investment in insurtech start-ups globally for 2016 was in analytics, artificial intelligence (AI), and the internet of things (IoT).

Another analysis of investments made in 2016 across 75 insurance companies revealed that although only 17% of deals made by the industry that year were related to insurtech, the other 83% were invested into start-ups that are

“Insurtech represents more of an opportunity than a threat” outside the insurtech space “but often with a focus on technologies that hold potential for the insurance industry in the future”.

“There’s a growing recognition among insurers that insurtech ultimately represents more of an opportunity than a threat, and that they should seek to collaborate more closely with this latest breed of technology-fuelled start-ups,” the report concluded.

Q&A

Phil Baker Underwriter in specialty lines BEAZLEY

Years in the industry 22 Fast fact Baker was the former president & CEO of Creechurch until it was acquired by Beazley

Making a technological transition Which technology trends do you think could change the insurance industry?

Technology is already changing our industry. Outside of telematics in the general market, we’re seeing intelligent systems take on more of the underwriting process, even in areas that are considered niche. While this will have an impact in many areas, for specialty insurers like Beazley, as we adopt these systems, it will free up our underwriters to spend more time on the art of underwriting. It will also allow us to spend more time with our brokers and insureds raising awareness of new exposures and researching new exposures our customers may face because of technology.

How is Beazley utilizing insurance technology?

The myBeazley e-trading platform is one example, which makes the quote and sales process easier for brokers. myBeazley provides brokers with a digital quote across many Beazley products within a couple of minutes. This trading platform was created with brokers, for brokers, and allows users to quote, buy and service a range of specialist insurance products at the touch of a button.

Your TekPacPlus package is targeted at smaller businesses; with more entrepreneurs dabbling in new systems, such as the sharing economy, do you have plans to tweak your product to better serve tech clients?

We do feel that the TekPac policy is very comprehensive, with broad coverage for general and professional liability and full cyber coverage. We will be offering this package to a broader industry segment, however, for other types of professionals and practitioners. We will be expanding the package offering by including D&O, EPL and legal expense cover.

How is Beazley enhancing its products and services?

Beazley has a broad offering of specialty products. In the future, we will offer access to the full suite of Beazley products through our Canadian offices. In addition, we now have access to the full resources of the Beazley organization, including product development, global placement capabilities, analytics, platform development and claim expertise. As we transition from an MGA to a full insurer, we’ll offer greater capacity on our existing product lines.

What challenges are you currently facing?

Canada is a very competitive market with abundant capacity. We understand that our brokers have a great deal of choice. As a result, we will continue to strive to broaden and enhance our products so that we continue to be at the forefront of the specialty market.

www.insurancebusiness.ca

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UPFRONT

OPINION

GOT AN OPINION THAT COUNTS? Email insurancebusiness@kmimedia.ca

The disruptors are coming Digital disruption could upend brokers’ crucial place in the industry, and adaptation is key to survival, write Michael Lyman and John Mulhall AS DIGITAL disruption continues to overturn traditional industries, insurance brokers are in line for a rude awakening. Having long enjoyed an indispensable role at the heart of the insurance industry, helping customers navigate complex decisions and provide services in times of need, brokers face a new reality where technology does the heavy lifting.

As data and analytics become intelligent enough to determine risk and identify the best carriers more accurately and quickly than the most highly experienced broker, brokers need a definitive business model shift to maintain their relevance and purpose.

The trouble is, they are up against the clock. Dynamic new market entrants are disintermediating brokers by using the small and mid-sized enterprise [SME] market as a launch pad. Likewise, carriers and reinsurers are poaching larger accounts with directto-customer value-added services, such as analytics-driven aggregation.

The squeeze on brokers’ top lines has become intense. By 2020, Accenture Strategy estimates that disruptive models and digital platforms could account for as much as 15% to 20% of the P&C SME market. Furthermore, revenues from mid-sized and large customers could erode by up to 20%.

With so much at stake, brokers need to fundamentally change their business model – quickly. Moving fast could allow them to reap the rewards by setting new product and service offering standards. Banking and wealth management have shown the way forward – many leading companies are turning the threat of digital disruption into an opportunity to

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raise competitive barriers. Vanguard Group’s robo-human money management service combines algorithm-driven asset allocation and rebalancing with access to human advisors; the service attracted more than $7bn in new assets after its launch in 2015.

As today’s insurance customers seek greater risk prevention, ease of service, customization and value-added services, platform business models can deliver greater value by enabling highly efficient transactions

the potential to substantially enhance risk structuring and placement.

Outcome-driven loss prevention: Brokers can boost their risk advisory and loss prevention offerings by applying analytics to a robust and expanding universe of structured and unstructured data sources.

Risk marketplace with valued services: As trusted intermediaries with technology and analytics capabilities, brokers are uniquely positioned to aggregate multiple value-added services that holistically serve customers’ risk needs, and potentially their balance sheet management. By developing strategic partnerships with providers and enabling access through a common platform, brokers can enhance their value and boost customer loyalty.

Innovative carrier solutions: Brokers can capitalize on their access to data via customer proximity and diverse carrier relationships. This will enable them to develop high-impact offerings that synthesize information across transactions for insurers, reinsurers and alternative capital providers.

“Having long enjoyed an indispensable role at the heart of the industry, brokers face a new reality where technology does the heavy lifting” that are customized and scalable. Around 83% of insurance executives expect platformbased business models to become part of their growth strategy over the next three years.

An additional 81% say platforms will bring organizations together in the digital economy.

While brokers won’t disappear, they will need to protect and defend their core business while launching new, value-creating strategies.

Platform business models can help them do both. While many brokers may need to buy or partner with others to create them, doing so will help secure their future relevance. Potential new business models to explore include: Next-generation risk placement: By making brokers better equipped to recommend the right carrier, products and insurance program structure for a given risk, automation and analytics have

New risk services: Most new entrants lack core capabilities around risk assessment, transfer and prevention. Brokers can pre-empt disintermediation by partnering with new competitors and offering a suite of services that enhances their ability to offer risk-based services directly to customers.

By rethinking their core business models, brokers can formulate a transformational business strategy, maintain their relevance and set new standards for customer engagement.

Michael Lyman and John Mulhall are senior managing directors for Accenture Strategy, where they help clients in the insurance industry develop and implement business strategies that enable high performance.

www.insurancebusiness.ca

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we offer flexible coverage options through two of the world’s leading insurers – Lloyd’s and AIG. We stand firmly committed to providing a high-quality solution to our base of over 3,000 brokers throughout Canada.

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Phone Number: 1-800-668-4275 www.mpamag.com 19 Phone Number: 1-800-668-4275

31/05/2017 5:58:31 AM

PEOPLE

INDUSTRY ICON

SEEING BEYOND BORDERS Carol Barton, president of AIG Multinational, talks about protecting businesses as they expand their global footprint and contemplates what’s ahead for underwriters A SEASONED insurance industry professional, Carol Barton is the global leader of AIG’s multinational division, charged with providing solutions for organizations whose business interests cross borders – an increasingly important focus in today’s rapidly evolving world.

“Twenty years ago, there were about 33,000 companies that did cross-border business globally,” Barton says. “Today, it’s probably 193,000 plus companies. It’s almost a business imperative to be multinational, but the landscape in multinational is changing.

In every country, there are different regulations, a different cultural environment, and there is different employment law. From an insurance perspective, staying current and being compliant is critical.”

AIG’s solution to these challenges, Barton explains, has been to focus on a few key areas: “What we have been doing is investing in people, process and technology to drive insights, solutions with risk transfer and risk management capabilities, and service in a globally consistent and seamless fashion.”

The risk landscape On the subject of new and emerging risks, Barton mentions the word on everyone’s lips: cyber.

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“We’re seeing a huge uptick in take-up on [cyber insurance coverage],” she says.

But she stresses that it’s not just about providing cyber risk transfer solutions. Also integral is assisting clients in preparing for a potential cyberattack – particularly in light of the escalation in cyber risk that’s been driven by heightened connectivity as a result of the internet of things.

Barton considers global aggregation exposure to be the greatest challenge facing the insurance industry today.

“For me, the biggest challenge in terms of helping our clients is to really look at some of these emerging risks, look at the fact that most of them are aggregate exposures, and then managing that in a way that we will be there for our clients when an event occurs.”

“It’s almost a business imperative to be multinational, but the landscape in multinational is changing. From an insurance perspective, staying current and being compliant is critical” “While it is a plus in many regards to have so much connectivity … it is also creating a very porous environment where people can get in,” Barton says.

She adds that part of the challenge of cyber is the fact it’s an aggregation risk.

“It’s not just about an individual company; it’s about how many potential companies might be impacted by the same event. It’s similar to supply chain risk, which is getting ever more complicated, as well, as a result of the internet of things.”

Another major challenge under Barton’s purview is contract certainty.

“For multinational clients, it would be getting policies out in a way that gives them contract certainty when the loss occurs, and that has historically not been done,” she says.

“We’re very focused on a new multinational, end-to-end process where we have taken the work and lifted it ahead of the effective date so that we end up with policies issued on or before the effective date. We rolled that out last year, and we are starting to get traction.”

www.insurancebusiness.ca

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PROFILE Name: Carol Barton Company: AIG Title: President, AIG Multinational Based: New York City Joined AIG: January 2012 Fast fact: Prior to her role at AIG, Barton was senior vice president, chief underwriting and reinsurance officer at FM Global, where she had global leadership responsibility for all underwriting and reinsurance activities.

Photo by Barbie Schwartz

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PEOPLE

INDUSTRY ICON

It’s a work in progress, Barton adds, but it’s an effort to reshape the way business is conducted.

“We are very excited about it because it will give our clients contract certainty and meet their governance objectives as well,” she says.

Tomorrow and beyond Barton expects the role of underwriters to change in the coming years, thanks to the proliferation and exploitation of information.

“The availability of data and our enhanced ability to start to collect data and use it in a way that can inform underwriters should really help with the risk selection and

“You will still have your expertise, but I think underwriters will work more as a team to provide holistic solutions versus staying in their product silo.”

In times ahead, Barton also foresees underwriters will have increased interaction with clients.

“Underwriters will be interacting more with brokers and clients … and [there will be] a lot less focus on administrative, transactional, non-value accretive-type activities. I think it will be a lot of fun – it will be even more interesting than it is today.”

In looking toward the future, Barton also emphasizes the ongoing importance of the

“We obviously see our broker partners as very critical and important, and we are always looking for continuous improvement opportunities and for feedback from them” underwriting process,” she says.

“One of the trends we’re seeing is the ability to take claims data and use that for both underwriting risk selection and to help the client understand exposures that threaten their business, thereby allowing them to drive down their long-term cost of risk.”

She also emphasizes the significant role data can play in helping underwriters – and their clients – learn from losses.

“The ability to share knowledge and understanding is critical, and insurance carriers are uniquely positioned to deliver.

I think more and more, with technology, we will be able to do a better job at that.”

Barton also anticipates that the future will bring greater appraisal of risk from a holistic perspective.

“We have grown up as a very productoriented company – you had property people, casualty people, financial lines people … and now, I see that coming together in a more holistic view,” she says.

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broker channel to AIG. “We obviously see our broker partners as very critical and important, and we are always looking for continuous improvement opportunities and for feedback from them on how we are doing [and] what we can do differently … and then how they can support us, because a relationship is two-way.”

As for the year ahead, Barton is focused on AIG’s global goals, including delivering on the two-year targets the company set in its January 2016 strategic update.

“We are well on the way to delivering on that plan,” she says. “We have released $18bn to our shareholders. Our goal is $25bn over the two-year period, and we have every intention of returning the rest and achieving that target, as well as the other goals that we publicly stated.

“We are committed to continuing to really sharpen our focus and being sure to work with clients, where we can add the most value.”

AIG BY THE NUMBERS

1919

Year when AIG was established by Cornelius Vander Starr, who started an insurance agency in Shanghai, China under the name American Asiatic Underwriters

1926

Year when AIG’s first office in the US opened, in New York City

90 million

Number of AIG customers around the world

56,000

Approximate number of AIG employees worldwide

US$11.31bn

AIG’s revenue for the first quarter of 2017

www.insurancebusiness.ca

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It’s not what we do that makes us different... it’s how we do it!

Find out more about our industry leading specialty insurance and surety solutions at

www.trisura.com

a step above

Trisura Guarantee Insurance Company is a Canadian owned and operated Property and Casualty insurance company specializing in niche insurance and surety products. We are a proud supporter of the Insurance Broker’s Association of Canada.

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31/05/2017 6:10:49 AM

SPECIAL PROMOTIONAL FEATURE

AVIVA

The home of innovation Insurance Business visited Ben Isotta-Riches at Aviva’s Digital Garage to get the insider’s view on Canada’s burgeoning insurtech space

DIGITAL INNOVATION is playing an integral role in enabling the insurance industry to both recognize and meet changing customer needs. Digital companies offering new, optimized experiences and insurance are driving consumer expectations and insurance is under pressure to not only embrace the innovation, but also be a driving force behind it.

“To some extent, innovation is key to the survival of the industry. It also presents fantastic opportunities for companies to find new ways of distributing products or even creating new product categories

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altogether,” says Ben Isotta-Riches, who is Aviva Canada’s chief information officer.

“The products we insure are changing and so are people’s expectations around the types of product they want.”

More insurers are realizing the importance of taking a proactive approach in order to keep up with the unprecedented change that’s occurred in the last ten years.

Innovation is integral to keeping insurance relevant to people as the world evolves.

In an attempt to be the driving force behind change in the industry, Aviva has launched various internal initiatives

aimed at driving innovation, including hackathons. Employees are given 24 hours to work in teams to produce new products and propositions, which the company will then look to take to market.

Isotta-Riches has seen hackathons create a real entrepreneurial spirit inside the business. Company employees are now thinking differently about the organization and its future; they know they’re in the driving seat to make change a reality.

“Externally, we spend time working with start-up incubators, like the DMZ at Ryerson University, OneEleven and Plug and Play in California,” Isotta-Riches says.

“Talking to start-ups who are looking at the industry from a different perspective helps us find new opportunities.”

Isotta-Riches is keen to help build a strong insurtech community in Canada and believes that Aviva’s Digital Garage can be the cultural and physical hub.

Aviva has arranged various events where insurance professionals are able to collaborate and greenhouse ideas with start-ups and disruptors who bring a fresh viewpoint to traditional and modern insurance challenges.

“This space is the iconic starting point of our journey; a place where we can galvanize our own organization and bring others together,” Isotta-Riches says. “We will continue to make investments in different companies that have disruptive potential. We are also working with the DMZ at Ryerson to create an insurtech accelerator program to try to help foster the development of ideas here in Toronto.”

For innovation to truly spread through the Canadian insurance industry, IsottaRiches believes people need to be ready to take risks and accept that not every idea is going to be a success.

“You need to be prepared to disrupt yourself and find opportunities to do things differently before other people find them for you,” he says. “It’s better to be in charge of your own destiny and drive the industry rather than have someone else drive it. Companies need to be able to think like a start-up and take an entrepreneurial mindset to problems.”

www.insurancebusiness.ca

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2017-05-23 9:23 31/05/2017 6:00:19 AMAM

FEATURES

COVER STORY: ELITE BROKERS

BROKERS 2017

IN ITS fifth year, Elite Brokers 2017 celebrates the best and brightest insurance professionals that Canada has to offer. Following a vast response from brokers coast to coast, the submissions for Insurance Business Canada’s Elite Brokers 2017 were culled into this list of 34 of the industry’s top-performing professionals.

Achieving a position on IBC’s Elite Brokers list is a strong reflection of each broker’s standing as one of the top insurance professionals the marketplace has to offer.

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Discover the 34 brokers who are leading the pack in the Canadian insurance industry

While you may recognize a few familiar faces, this year’s list features a wealth of fresh talent who had banner years in 2016, earning them a place on this list.

Although each and every broker individually accomplished great heights in business last year, one sentiment that has echoed among the brokers throughout the years is that without a strong support system and network of colleagues, these Elite Brokers would not have reached the great success they have today.

Methodology This year’s Elite Brokers list celebrates the brokers who rose to the top of the insurance pack in 2016.

Coming from all walks of life and from various regions of the country, applicants who generated $750,000 or more in net commissions in 2016 qualified as an Elite Broker. Each nominated brokers was required to provide specific details about his or her business to be eligible.

www.insurancebusiness.ca

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THE TOP 34 - $750,000 OR MORE IN COMMISSIONS RANK

NAME

COMPANY

LOCATION

CRUNCHING THE NUMBERS

1

Kevin Stedman

Jones DesLauriers Insurance Management

Ontario

2

Wendy Wildeman

Rogers Insurance

Alberta

3

Wayne LeGear

HUB International Insurance Brokers

British Columbia

4

Chris Sikorski

Arthur J Gallagher

Alberta

5

Michelle Elliott

HUB International Insurance Brokers

British Columbia

6

Melanie Stefiuk

HUB International Insurance Brokers

British Columbia

7

Mark McKinley

Lloyd Sadd Insurance Brokers

Alberta

TOP 5:

8

Nick Wong

Sharp Insurance

Alberta

Total policies: 4,221

9

Joe Palmer

Palmer Atlantic Insurance

New Brunswick

Total clients: 2,257

10

Luke Horcica

Lloyd Sadd Insurance Brokers

Alberta

Average commissions: $2.71m

11

Ray Botros

Sharp Insurance

Alberta

Total commissions: $13.58m

12

Moe Adam

Sharp Insurance

Alberta

13

Thomas Watson

Guardsman Insurance Services

Ontario

TOP 10:

14

John Ferraro

Oracle RMS

Ontario

Total policies: 7,250

15

Sunny Cao

Sharp Insurance

Alberta

Total clients: 3,870

16

Terence Hogan

Lloyd Sadd Insurance Brokers

Alberta

Average commissions: $2.29m

17

Don Barr

Lloyd Sadd Insurance Brokers

Alberta

Total commissions: $22.9m

18

Lane Gross

Lloyd Sadd Insurance Brokers

Alberta

19

David Mills

HUB International Insurance Brokers

British Columbia

TOP 34:

20

Janice Boiko

Lloyd Sadd Insurance Brokers

Alberta

Total policies: 22,588

21

Tanya Sinclair

Lloyd Sadd Insurance Brokers

Alberta

22

Allen Walter

Lloyd Sadd Insurance Broker

Alberta

23

Brock Longworth

Cornerstone Insurance Services

Saskatchewan

24

Michelle Topping

HUB International Insurance Brokers

British Columbia

25

William (Bill) Beere

HUB International Insurance Brokers

British Columbia

26

Mark Shaul

Lloyd Sadd Insurance Brokers

Alberta

27

Martin Willey

Lloyd Sadd Insurance Brokers

Alberta

28

Michael Kucharuk

Jones DesLauriers Insurance Management

Ontario

29

Kevin Roth

Lloyd Sadd Insurance Brokers

Alberta

30

Magdalena Cammidge

Lloyd Sadd Insurance Brokers

Alberta

31

Kevin Lea

Rogers Insurance

Alberta

32

Mike O'Grady

O'Grady & Associates Insurance Services

Ontario

33

Brian Jardine

Arthur J Gallagher

Alberta

34

Tarek Younan

Sharp Insurance

Alberta

Each and every broker in this table achieved $750,000 or more in commission last year, but where do these astounding insurance professionals stand as a group?

Total clients: 13,962 Average commissions: $1.4m Total commissions: $48.08m

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FEATURES

COVER STORY: ELITE BROKERS SHINING THE SPOTLIGHT ON A FEW OF THIS YEAR’S ELITE BROKERS

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BROCK LONGWORTH

THOMAS WATSON

LUKE HORCICA

Operations manager

Vice president

Principal

Cornerstone Insurance Services

Guardsman Insurance Services

Lloyd Sadd Insurance Brokers

Brock Longworth started in the insurance industry aged 15, wrote the CAIB 1 at 16 and got a level 1 licence a year later, and has moved up the ranks ever since. Recently, he’s taken on the role of operations manager for commercial and personal lines. He also spent some time developing an online platform for selling personal and commercial insurance.

“It was a lot of work to get it in place, but that is probably my biggest, most exciting accomplishment,” he says.

For Longworth, the key to his growth is his brokerage’s customer experience strategy: “At the end of the day, we want every interaction with every client to be worthy of a referral.”

In his new role, he is looking forward to spreading the success through his brokerage.

When he’s not volunteering, Thomas Watson is dedicated to looking after his clients. A thirdgeneration insurance broker, he purchased Guardsman Insurance Services from his grandfather in 2013 and now serves as the brokerage’s vice president. He’s also an officer in the Canadian Armed Forces, a lieutenant in the Navy.

At his brokerage, he prides himself on finding creative, individualized solutions to his clients’ needs. Watson says a defining characteristic of an elite broker is dedication: “Dedication to your clients, co-workers and companies.”

As for the secret of his success, he says it’s simple: “Insurance is fast-paced. It’s only by staying proactive that you can deliver the peace of mind your clients expect.”

Hoping to be “the one to call” when it comes to his insurance specialty, Luke Horcica learns his clients’ businesses inside and out in order to build a strong partnership. Arriving at Lloyd Sadd in 2000, he quickly found his niche: hospitality, construction and real estate/ property management.

“A broker today can’t be everything to everybody – we need to be sector specialists … clients should be confident their broker is bringing advice/ solutions for trends and emerging risk specific to their industry,” he says.

Despite a challenging market in 2016, it didn’t slow down his business. “2016 gave me the chance to learn more about my clients’ businesses. Despite the economic slowdown, I was the busiest I remember,” he says.

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THE BIGGEST BOOKS Elite brokers with the highest number of clients in 2016 RANK

NAME

COMPANY

CLIENTS

1

Mike O'Grady

O'Grady & Associates Insurance Services

2,269

2

Brock Longworth

Cornerstone Insurance Services

1,598

3

Thomas Watson

Guardsman Insurance Services

1,112

4

Kevin Stedman

Jones DesLauriers Insurance Management

1,094

5

Moe Adam

Sharp Insurance

758

This year, the elite brokers who made the list built impressive books of business in 2016. The top five brokers in terms of total number of clients garnered 6,831 clients last year.

Mike O’Grady, owner of O’Grady &

Associates Insurance Services, topped the list with 2,269 clients, surpassing his total number of clients last year, which stood at 2,105. Operations manager at Cornerstone Insurance Services Brock Longworth makes his second appearance

on our top client list, with 1,598 clients in his book for 2016. When he is not focused on building his own book, Longworth finds it rewarding when he witnesses the success of his peers when utilizing similar tactics.

“In my final couple of years as manager of personal lines, I was really focusing on developing our personal lines team, it was a shift for me to turn from building my own book and making sales myself to coaching others to make sales and operate efficiently, but I found it really rewarding to see the strategies and principles that had worked well for me be passed along and start to work for other brokers,” he says.

“I’m really excited about my new role as operations manager and working to further expand that same thing to the rest of our brokerage.”

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FEATURES

COVER STORY: ELITE BROKERS WRITE ON THE MONEY Elite Brokers with the most policies written in 2016 RANK

NAME

COMPANY

1

Mike O’Grady

O’Grady & Associates Insurance Services

4,413

2

Brock Longworth

Cornerstone Insurance Services

2,986

3

Kevin Stedman

Jones DesLauriers Insurance Management

2,032

4

Nick Wong

Sharp Insurance

1,083

5

Moe Adam

Sharp Insurance

939

Making their third appearance on the list of brokers with the highest number of policies written, familiar faces Mike O’Grady and Brock Longworth made it on this year’s list in the top two slots, in addition to reaching top-five status in terms of the total number of clients.

J Kevin Stedman, partner and chief sales officer at Jones DesLauriers Insurance

TOP 5 BROKERS BY AVERAGE COMMISSIONS PER CLIENT Although all the brokers on this year’s list surpassed $750,000 in commissions for 2016, what is perhaps more impressive is the average commission gained from each client and policy. To honour their hard work, here the spotlight shines on those brokers who generated the most commissions per client and per policy written in (p32).

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POLICIES

FAST FACT

Management, and Moe Adam, account manager at Sharp Insurance, both make double appearances on the top five lists this year with impressive books of business and policies written, totalling 2,032 and 939 policies written in 2016, respectively.

Representing Sharp insurance, Nick Wong, account manager, takes the fourth spot with 1,083 policies written in 2016.

This year, 21 new Elite Brokers made the list compared to 2016

TOP 10 BROKERS BY AVERAGE COMMISSIONS PER CLIENT RANK NAME

COMPANY

AVERAGE COMMISSIONS PER CLIENT

1

Wendy Wildeman

Rogers Insurance

$56,600

2

Mark McKinley

Lloyd Sadd Insurance Brokers

$24,707

3

Joe Palmer

Palmer Atlantic Insurance

$17,327

4

Don Barr

Lloyd Sadd Insurance Brokers

$14,255

5

Terence Hogan

Lloyd Sadd Insurance Brokers

$12,673

6

Tanya Sinclair

Lloyd Sadd Insurance Brokers

$12,572

7

Lane Gross

Lloyd Sadd Insurance Brokers

$10,837

8

Mark Shaul

Lloyd Sadd Insurance Brokers

$10,241

9

Chris Sikorski

Arthur J Gallagher

$10,147

10

Michelle Topping

HUB International Insurance Brokers

$10,089

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FEATURES

COVER STORY: ELITE BROKERS TOP 10 BROKERS BY AVERAGE COMMISSIONS PER POLICY WRITTEN RANK NAME

AVERAGE COMMISSIONS PER POLICY

COMPANY

1

John Ferraro

Oracle RMS

$20,294

2

Thomas Watson

Guardsman Insurance Services

$11,718

3

Wendy Wildeman

Rogers Insurance

$11,230

4

Michelle Topping

HUB International Insurance Brokers

$9,070

5

Janice Boiko

Lloyd Sadd Insurance Brokers

$5,785

6

Joe Palmer

Palmer Atlantic Insurance

$5,678

7

Melanie Stefiuk

HUB International Insurance Brokers

$4,684

8

Mark McKinley

Lloyd Sadd Insurance Brokers

$4,622

9

Wayne LeGear

Hub International Insurance Brokers

$4,156

10

Michelle Elliott

HUB International Insurance Brokers

$4,022

An unwavering commitment to customer service, from the initial meeting to the followup and through processing a claim.

Relationships

The ladies are quickly rising up the ranks in the industry. Twenty per cent of the Elite Brokers are women this year, with several landing in top spots. On average, the elite brokers wrote 672 policies and had over 400 clients in their books. Impressively, the top 34 elite brokers this year beat out last year’s top 34 out of 57 by over $1.5m in terms of commissions generated.

80%

Elite Brokers come from all walks of life, but when speaking with them, but they all shared the following common strategies for success

Customer service

WHAT IS THE MAKE-UP OF 2017’S ELITE BROKERS?

MALE

DO YOU HAVE WHAT IT TAKES?

410

Nurturing relationships with clients, colleagues, insurers and other brokers is vital for the longevity and success of those relationships.

Personal connections

In the age of technology, personal touch is often lost through emails and texts.

Making a genuine connection by picking up the phone or heading out to an in-person meeting is a standout in today’s market.

AVERAGE NUMBER OF CLIENTS

690

FEMALE

20%

32

$1.5m

INCREASE IN COMMISSIONS COMPARED TO LAST YEAR’S TOP 35 OUT OF 57

AVERAGE NUMBER OF POLICIES WRITTEN

Internal teamwork

Most brokers can agree that a successful career would be impossible without the support of a qualified team.

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WHAT STRATEGIES DO ELITE BROKERS HAVE FOR SUCCESS VERBATIM?

“Referrals” “My goal is to make insurance easy for my clients. The less time they need to spend thinking about insurance and risk, confident I understand their business and my own, the more time they can spend focusing on growing their business” “Building relationships and creating friendships” “[My] over-riding strategy is customer experience … from online services, normal service standards, surveys, etc”

THE TOP 5 The Top 5 Elite Brokers come from various regions – Ontario, Alberta and British Columbia – and have made remarkable numbers for 2016, despite a challenging year for the Canadian insurance market.

There are some repeat champions, a fresh face and a few returning brokers. Kevin Stedman (Jones DesLauriers Insurance Management) takes the top spot, after claiming third in 2015. Wendy Wildeman and Wayne LeGear, second and third, respectively, make repeat appearances in the Top 5.

Rounding out the list are newcomer Michelle Elliott and Chris Sikorski, who placed fourth in 2015.

Together, they totalled commissions of $13.58m in 2016, an average of $2.71m – far above the $750,000 benchmark.

5

MICHELLE ELLIOTT

Account executive HUB INTERNATIONAL INSURANCE BROKERS

An account executive with HUB International Insurance Brokers’ Strata division, Michelle Elliott began her insurance career eight years ago as a personal insurance advisor. In her current role, Elliott provides coverage and service to a variety of HUB’s strata clients. “The most rewarding part of my job is the time spent with clients, listening to their needs and helping provide solutions,” she says.

In recognition of her dedication and top performance, Elliott has received HUB’s top sales award, Platinum SHARP, for three consecutive years and was nominated for HUB’s Employee of the Year Award in 2013 and 2016. “She is a true advocate for her customers, making sure they are properly covered with the best coverage available,” a colleague says. “She has an excellent ability to negotiate the most favourable terms for her customer, while balancing the underwriting needs of our insurance partners.”

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FEATURES

COVER STORY: ELITE BROKERS

4

CHRIS SIKORSKI

Senior vice president ARTHUR J GALLAGHER

A place on the Elite Broker list is becoming routine for Chris Sikorski. He was featured in the list in 2013, ’14 and ’15. Hired by Renfrew Insurance in 2002, Sikorski started in the personal lines division, and subsequently moved into commercial lines before ultimately becoming a SVP and partner at Arthur J Gallagher prior to the acquisition of Renfrew Insurance in 2015 - becoming the youngest producer to be promoted to such roles. Today, he specializes in the construction and real estate industries, and stays in tune with the needs of the sectors as a member of the Alberta Mechanical Contractors Association, Calgary Construction Association, Electrical Contractors’ Association of Alberta and the Canadian Homebuilders Association, Calgary region.

Sikorski puts his success down to simple Networking. “The main strategy I utilize for growth is networking. I have worked hard to build my reputation within the areas I specialize in and try to leverage this along with my contacts to meet new and prospective clients,” he says.

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3

WAYNE LEGEAR

Senior vice president, account executive HUB INTERNATIONAL INSURANCE BROKERS

You may recognize Wayne LeGear from last year’s Top 5 and, once again, he’s made it on the Elite Broker list. At HUB International, he serves as senior vice president and account executive, specializing in commercial and transportation insurance, and is responsible for HUB’s auto dealer program. LeGear first started his career as a partner at LeGear Pelling Insurance in 1982, before partnering with LakeView Insurance in 1991. Six years later, Lakeview Insurance joined HUB International Insurance Brokers, where LeGear continues to manage that office’s operations, as well as other HUB offices in the Greater Vancouver area. A HUB Sharp Award winner at the platinum level for eight consecutive years, LeGear is a “sales performance legend” within the organization.

The secret to his success? He says: “The relationships you establish with clients and colleagues. There’s a lot of satisfaction from putting together a good program for a client, being there at claim time and over time becoming a trusted advisor and friend.”

2

WENDY WILDEMAN

Senior account executive ROGERS INSURANCE

What started as a temporary job has turned into an over four-decade career for Wendy Wildeman – and it is clear that she made the right choice. Now a second-time Elite Broker, Wildeman today serves as senior account executive at Rogers Insurance, where she specializes in real estate and construction insurance.

In an industry that is constantly evolving, the learning never stops for Wildeman. A “life-long learner” she acknowledges how she has been fortunate to work with some remarkable people throughout her career – both as associates and as mentors.

Wildeman says that having the opportunity to work with a variety of people – from clients, co-workers, underwriters and more – has been the most rewarding aspect of her career. Her advice to brokers who are looking to grow their business: “Ask questions, learn all you can about your clients and their business so you can provide solid risk management solutions.”

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FEATURES

COVER STORY: ELITE BROKERS

1

KEVIN STEDMAN

Partner, chief sales officer JONES DELAURIERS INSURANCE MANAGEMENT

The No.1 Elite Broker 2017, Kevin Stedman has over 28 years of experience in the insurance industry, and he has a dedicated and sophisticated approach to how he applies his knowledge and understanding of insurance when servicing clients.

As partner and chief sales officer, Stedman focuses on serving trucking, commercial auto, construction and manufacturing industries. As a result of his superior success in 2016, Stedman was awarded with Jones DesLauriers’ Award of Excellence for his contributions to the firm. When asked what his key strategies to success are, Stedman specifies “strong time management”, “focus on excellent customer service”, and having a “great service team working with you” as crucial to his achievements.

When he’s not supporting his clients, Stedman supports his community and charitable initiatives. He volunteers for various kids programs in the Peterborough, Ontario area, such as serving as the Peterborough Petes’ minor hockey coach for the community’s hockey program. In addition, through his clients, Stedman has volunteered his time to Habitat for Humanity and has served meals at his local food bank.

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FEATURES

BROKERAGE INSIGHT

A champion for brokers Reith & Associates principal broker Dan Reith explains how his brokerage has succeeded for over a century by advocating the broker role

IBC: Reith & Associates has experienced great success for over a century. What has been a key strategy to that success?

Dan Reith: When I look at our more recent achievements over the past decade, it would be the development and implementation of our unique process that we termed Mission to Your Prosperity, as well as the implementation of our Discovery method. These all tie into our utilization of best practices gained from the Million Dollar Round Table (MDRT), which my brother Darren has been fortunate to be a member of for over 15 years. We’ve taken the best practices he learned at MDRT and applied them to the operations of a property and casualty brokerage. This has helped us focus on organic growth through the development of client relationships by better understanding our clients’ needs and expectations, which ties back our unique process.

more importantly, if we are a good fit for them. We then move through to the Advantage Discovery, Solution Mapping, Solution Activation, Support System and conclude with the Strategic Review Experience, which happens every year at renewal.

Through the application of this process, we have really mastered organic growth. Since I joined the company in 1992, we have grown ten times, and we are currently on track to grow another ten times all through organic business gained through our Mission to Your Prosperity process.

IBC: What are your thoughts on the technology revolution happening in the industry?

DR: We have to embrace it. Technology has to be utilized wisely, as a component of one’s overall business strategy, not as the be-all and end-all. I do not believe the technology solution for a broker in the Greater Toronto

area is necessarily right for a broker in rural southern Ontario. The key is clearly understanding the expectations of your ideal client and developing an operating platform and client experience model around them. As brokers, we must remember our strategic advantage: choice, and competent council.

We serve as an advocate. If we utilize technology that distances us from our clients, limiting or reducing the importance of our strategic advantage, by allowing complete self-service access, we run the risk of proving ourselves unnecessary and redundant.

IBC: How does Reith & Associates maximize opportunities?

DR: We look at the best way to maximize the opportunities presented to us by coming up with solutions that best capitalize those opportunities. For instance, we were having a conversation one day around how we can provide more services. That was when we came up with the idea of tax planning. We

IBC: What is Reith & Associates’ unique process?

COMMITMENT TO THE COMMUNITY

DR: It is the cornerstone of what we call the Reith Advantage. Over our many years of practice, we developed this six-step process. It gives us tremendous insight into our clients’ and prospective clients’ needs and expectations. It begins with our Right Fit Experience. Here, we get to know the client to determine if they are a good fit for us and,

For many years, Reith & Associates’ employees have volunteered their time to support organizations in St Thomas and the surrounding communities. As a result of their involvement, the firm established the Reith & Associates Community Volunteer Program, which annually distributes funds to charities selected by volunteering employees and their families, such as Shriners Hospitals, Ronald McDonald House, St Thomas-Elgin Public Art Centre and more. Most notably, ten years ago the brokerage sponsored the building of the indoor walking track, the Reith Family Walking Track, at the Timken Community Centre, which has become a community staple.

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REITH & ASSOCIATES’ HISTORY

1914 Alvin Brown establishes the AM Brown Insurance Agency in Shedden, ON

1961 Harold Jackson, Alvin’s cousin, joins the agency

1962 Dan Reith Sr, son-in-law of Harold

Jackson, joins the agency and forms Reith & Jackson Insurance Agency

1992 Dan Reith Jr joins the brokerage “The brokerage industry needs to seriously look at a fee-for-service program … we give away all of our intellect for free” have a number of clients for whom we perform investment and financial services, so we thought: “If we were to understand their tax situation, how could we better serve their financial planning needs?” So one of our in-house financial planners became certified as a personal tax specialist, and now we provide that service. We took that opportunity and maximized its potential.

IBC: What is your prediction for the future of the Canadian insurance industry?

DR: Our insurance company “partners” will be our biggest competitors. We need to understand what they don’t do well and what we can do better. We need to ensure that we do not become irrelevant and there remains a

true partnership. There needs to be a retraining of the consumer to understand that the lowest price is not the best insurance. It is a recurring message our insurance company competitors shout loud, clear and regularly.

Another thing that the brokerage industry needs to do is begin to seriously look at and implement a fee-for-service program. We have the same duty of care to our clients as a lawyer or accountant does; yet we don’t get paid like they do. An insurance company pays a commission for us to place a piece of business, but we give away all of our intellect for free. I think that it’s time for the industry to acknowledge that there is a value here and we should be charging for it, and I believe that is a direction that the industry needs to begin to go in the future.

1994 Darren Reith joins the brokerage in the

life insurance and financial services unit

1999 The brokerage rebrands to

Reith & Associates Insurance and Financial Services

2000 Brothers Dan and Darren Reith assume ownership of the brokerage

2014 Reith & Associates is named Insurance Brokerage of the Year by the IBAO

Today The brokerage remains a family business

with Dan leading the team as principal broker, and Darren leading the life insurance and investment services team

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FEATURES

NETWORKING

The power of the tribe Recognizing and realizing the value of business networks is crucial, writes entrepreneur and networker Janine Garner

IN THIS incredibly fast-paced business and economic landscape, we can no longer do it alone – realistically, we never could; we just thought we could. Building a powerful and diverse network – your own personal tribe – is a critical must-have within the new operating system of commercial collaboration. Moving from the isolated ‘me’ space to the collaborative ‘we’ space will future-proof careers, leadership and your own personal success.

A powerful and diverse network drives your success by: creating new opportunity for growth stretching, pushing, driving and inspiring you enabling you to contribute and influence more and leverage your position further This ‘we’ space of commercial collaboration

40

requires courage, confidence and bravery, and is one in which networks of connected individuals, communities and businesses work together to drive success. We can bring our skills, strengths and talents to the table and together amplify and share expertise to create progressive, results-oriented solutions.

Collective intelligence means we work smarter and quicker together. In fact, diversity and difference of opinion are actually the new competitive advantage.

Networking, connecting, meeting, doing coffee, lunch dates and even speed-connecting – all these terms are synonymous with meeting others to drive skill sets, contacts and ongoing business and personal growth. And however much you might want to hide under the white

tablecloths of a corporate breakfast, powerful and effective networking has evolved and is now a business must for all who want to forge ahead. It’s not simply about building up a Rolodex of business cards (or, more accurately, a smartphone full of virtual ones), a mass of LinkedIn contacts or a significant number of social media followers. It’s about a true meeting of minds and skill sets, and skilfully parlaying said meetings into successful longrange relationships.

Networking is a must-have for successful collaboration, and the diversity of that network is the tipping point between average connections and those that collaborate to create magic. The cross-fertilization of connections, skills and brainpower, and the ideas that

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are openly discussed and shared through network creation, in their turn create new opportunities, innovation and new solutions to existing problems. It’s a domino effect – the way your initial networks interact provides a guideline for the subsequent networks that spring up from these collaborations. They will only benefit from your experience and way of working together.

Building your network The most innovative businesses and organizations are finding that effective and powerful networking is giving them an edge.

So how do you find, build and manage a diverse network? How do you gain entry to a true circle of excellence that will work with you and not against you?

The critical element of a powerful network that can become your lifeline, and an absolute must-have for successful collaboration, is diversity. Building an effective and powerful network is so much more than finding a safe, like-minded tribe. It requires diversity, a width and breadth of contacts, a willingness to embrace the opportunity that exists in differences and, finally, an understanding that you may not always agree with or understand certain points of view, but that through the connection, you will build awareness and knowledge.

An effective network is a diverse network that consists of people who differ in expertise, age, gender and experience.

Powerful networks are those that are crossfunctional and cross-industry. Think about it: a like-minded network limits the breadth of conversation. Lawyers sit in a room with lawyers, sharing their legal experience. CEOs play golf with CEOs; fashion industry PR experts mingle with other fashion industry PR experts. Now imagine the color of the conversation if, instead, you had lawyers, accountants, creatives, athletes, marketers and business owners discussing the various solutions to a problem. Imagine the different perspectives shared, the varying insights, the depth of conversation that would stretch thinking and push perspectives wider.

Diverse connections challenge thinking, drive further questions, push boundaries, increase awareness and open our eyes to

another way. They also bring to the forefront opportunities that were previously not in your direct line of vision, present solutions that weren’t on your radar and create innovations that you once thought were not possible.

Who do you need to surround yourself with to inspire you and your business to achieve more? As Jim Rohn said, “You are the average of the five people you spend the most time with.”

A powerful network is one that consists of people who have similar mindsets but diverse experience and will stretch thinking and push boundaries. Furthermore, those within a

similarities or ethical focus, or a desire to advance the same cause – and expecting nothing in return – this creates a fantastic opportunity for collaborative relationships, and also for a true value exchange, where ‘What’s in it for me?’ turns into ‘What can I do for you?’

The ‘we’ space is not a pipe dream. There are businesses and leaders who are clearly succeeding by operating within this framework.

It is the center of discussion among academics, thought leaders and consulting groups. Those corporations and entrepreneurs who are using the space well are seeing procedures streamlined, the bottom line coming up,

Building an effective and powerful network is so much more than finding a safe, like-minded tribe. It requires a willingness to embrace the opportunity that exists in differences powerful network realize the power of sharing ideas and of coming together, and value-add to each other’s businesses through the power of plural perspectives.

Those who are willing to be a part of a collaborative working environment are doing so because they want to be challenged. They want to constantly learn from others and to share what they’ve learned, to engage on an intellectually challenging level with likeminded thinkers, to see their own business benefit from the knowledge of specialists, and to be happy knowing that they are on the edge of technological advancement, constantly pushing the ‘what if ’ button – because, as a team, they feel secure enough to take risks.

Harnessing the network’s power The concept of commercial collaboration is not for the faint-hearted; it’s for those who can see the far-reaching benefits of what the ‘we’ space is about – and yes, it is a gradual move that involves challenging thinking. But it is not something that one has to contemplate in solitude.

Understanding the power of your network and using its potential is intrinsic to the ‘we’ mentality. To care about the well-being of those who are connected to you through business

and employees becoming more engaged and happier. Their ‘communities’ are becoming communities without the quotation marks.

It is not enough, in the words of Sheryl Sandberg, to ‘lean in’ to future-proof our success, our businesses and our careers.

For leaders who are taking teams into an uncertain future, it’s now about leaning out and collaborating with others. Because to lean out means to embrace and engage on an unforeseen aggregated level – where thinking bigger than ever before will bring rewards to a collective commercial mind.

The barriers between genders, between generations, between cultures, between the inventors and the investors, between the change-makers, the visionaries and those that make it happen – these all have to be broken down.

This is all a part of the evolution of ‘me’ to ‘we.’ This is all a part of collaborative business. This is not about a revolution; it’s about evolution.

Janine Garner is the founder and CEO of LBDGroup and works with senior leaders to build high-performing teams. She is also the author of It’s Who You Know .

www.wealthprofessional.ca

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FEATURES

BURNOUT

Avoiding burnout Leadership expert Karen Gately explains the six typical drivers of burnout in business leaders and offers practical tips to help you avoid them

HAVE YOU ever reached the point where you felt like you simply couldn’t go on? Have you found yourself losing concentration and lacking the motivation to do the things necessary to drive the performance of your business? It’s common for CEOs and senior leaders to experience periods of disengagement from their roles and teams due to the extreme exhaustion they feel, and many fail to recognize the state of burnout they have reached.

Burnout is a state of emotional, mental and physical exhaustion caused by excessive and prolonged stress. Typically reflected in our energy and behaviours, burnout unquestionably undermines any CEO’s ability to lead a thriving organization. Despite its devastating impacts not only on job performance but also on quality of life, many of the senior leaders I work with fail to take the necessary steps to avoid reaching this state of exhaustion and disengagement.

The following are six typical drivers of burnout in business leaders and some tips for how to avoid them.

1

Overcommitting

There are always more things you could do in any given day. But the reality is that it isn’t possible to explore, plan and execute all of the ideas and even priorities you are likely to have. Your ability to invest energy and resources wisely depends on your ability to know what matters most. While deciding what you will do is important, arguably more so is deciding what you won’t.

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TIP Create a business plan on one page.

Identify the priorities that will have the greatest influence on your success, and anchor your focus, and that of your team, to them.

Review progress regularly, and identify ways in which you need to bring focus back to these critical objectives. Strike things off your to-do list that add little value and distract you from your main mission. Learn to say no.

2

Avoiding

The need to make tough decisions and have difficult conversations is inevitable when leading a team or organization. And yet so many of the leaders I work with avoid them.

Strike things off your to-do list that add little value and distract you from your main mission. Learn to say no The consequence of failing to address issues is continuing to live with the stressful impacts of underperformance and uncertainty. Fear of having the conversations or implementing the actions necessary to drive change is common among leaders who experience burnout.

TIP Work with someone who is able to guide you in shifting the thoughts and feelings that cause you to hesitate to do what is necessary.

Find a mentor or coach you trust to challenge your thinking and hold you accountable for dealing with issues that arise.

3

Executing poorly

Even when decisions have been made, executing them can be difficult. Most often what I observe are senior leaders who recognize what needs to be done but fail to act decisively.

These leaders fail to apply disciplined approaches that ensure priorities are achieved.

Commonly, a lack of planning, review, and deliberate decision-making about priorities and resource allocation leads to costly mistakes and wasted resources. The pressure and workload demands on leaders and teams when things go wrong can be immense.

www.insurancebusiness.ca

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and the desire to be with our friends and family. We’re likely to reach burnout if we fail to give our mind, body and spirit the nurturing needed to thrive.

TIP Establish routines that ensure you take time out for you. Switch off the technology that allows you to stay connected with your work world, and spend time with the people you love and doing the things that energize your spirit. Maintain a level of activity and diet that allows your mind and body to be healthy.

6

Worry and regret

Reflect for a moment on how much time and energy you waste worrying about things that are outside of your control. How often do you worry about things that haven’t yet happened and may never happen? Do you expend vital energy on concerns that can’t be resolved? Feeling helpless and regretful drains our energy and is likely to erode our resolve to keep striving.

TIP Develop your organization’s ability to manage projects well. Develop your own ability to set a clear vision, establish priorities and drive change. Also develop the capabilities of leaders at all levels of your organization to drive strategic priorities through to successful implementation.

4

Aiming for perfection

Let’s face it – worrying about being perfect all the time is stressful. Many of the perfectionists I have worked with have recognized this tendency in themselves but have failed to see the seriousness of its consequences soon enough. The simple truth is that none of us or our businesses are perfect. Investing unnecessary time, energy and resources in striving for standards beyond what our staff or customers expect is

a common reason CEOs are overworked.

TIP Understand the 80/20 rule and apply it. The rule states that 80% of your outcomes come from 20% of your inputs.

The important thing to understand is that in your life, 20% of the activities you do account for the majority (80%) of your happiness and success.

5

TIP Recognize when you are worrying.

Start by asking yourself whether the problem is something that can be solved, and whether it can be solved by you. For example, is the problem something you’re actually facing, or is it just a ‘what if ’? Is your concern realistic?

Can you do something about it or prepare, or is it really out of your control? If it’s an unsolvable worry, recognize that fact, put it out of your mind and move on.

Avoiding burnout comes down to making necessary and balanced choices – those that allow you to deliberately invest time, energy and resources in achieving what matters most.

Know when to let things go, choose to focus on today, and keep an eye on the future.

Work-life imbalance

We all need time away from work to slow down, unwind and recharge. No matter how much we love our work, if the time we spend doing it disproportionately consumes our focus and energy, our health and relationships are likely to be impacted.

It’s difficult to avoid feeling stressed when conflicted between the demands of our job

Karen Gately is a leadership and people management specialist and the founder of Ryan Gately. She works with leaders and HR teams to drive business results through the talent and energy of people. Gately is also the author of The People Manager’s Toolkit: A Practical Guide to Getting the Best from People and The Corporate Dojo: Driving Extraordinary Results Through Spirited People.

www.insurancebusiness.ca

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PEOPLE

CAREER PATH

ALWAYS LOOKING AHEAD After moving from law to insurance, Alan Jay Kaufman quickly rose to the top of the industry

Raised in Detroit the son of a US-based Lloyd’s broker, Kaufman was exposed to the industry at an early age.

In college, he originally studied veterinary science but eventually went to business school, where he took insurance classes.

“I was too entrepreneurial to be a vet; insurance interested me because my father, Herbert W Kaufman, was in the business.”

1960s

EMERGES AS A YOUNG ENTREPRENEUR

1974 1996

BUYS THE FAMILY BUSINESS While practising as a lawyer, Kaufman approached his father with a plan for the future of HW Kaufman Financial Group. The plan took more than four years to pull together, but the company was eventually purchased via a leveraged buyout.

“I was determined to purchase the company; I was convinced it would be a good future for me and my family and a great opportunity for me as an entrepreneur.”

2013

WINS A MEANINGFUL AWARD Kaufman has racked up plenty of industry accolades over the years. In 2012, he was named one of the top 25 Living Legends of Insurance

by American Agent & Broker. He’s also appeared twice on the IBA Hot List. However, the award he treasures most is the Distinguished Alumni Award from his alma mater, Michigan State University, bestowed in 2013.

“I treasure it, as it was my school that originally put me in the position to do what I’m doing.”

2016 HITS A REVENUE RECORD Under Kaufman’s leadership, both the HW Kaufman Financial Group and the companies in its portfolio delivered double-digit annual growth last year, exceeding $2bn in revenue. Also in 2016, Burns & Wilcox, Kaufman’s flagship company and one of the largest specialty insurance brokers, generated more than $1.2bn in annual premium.

“I attribute it to the great people we’ve been able to bring on our team and the superb job they’ve done. It’s a great team effort.”

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SETS HIS SIGHTS ON A LEGAL CAREER While attending law school at Notre Dame, Kaufman focused his efforts on an international program that allowed for study at the London School of Economics. A distinguished legal career followed, which included a stint as the vice consul of Panama.

“Friends and family always thought I would go into law – I was drafting contracts in elementary school. My interest in international law came from my interest in international insurance law.”

2001 FOUNDS THE KAUFMAN FAMILY FOUNDATION A great believer in education and keenly aware of the problems insurance has in drawing the best and brightest, Kaufman put his resources behind his beliefs by setting up a foundation to award scholarships to exceptional students.

“Some preconceived ideas about insurance mean the best talent is not attracted to the field.

I saw the foolishness and thought, ‘Why can’t people do something about that?’ So I did.”

2014

CIRCLES BACK WHILE GIVING BACK Harking back to his early passion, Kaufman joined the board of the Detroit Zoological Society – the latest in a long list of public service positions that date back to Kaufman’s days as a Boy Scout, when doing a daily good deed was ingrained in him.

“You pay dues in life; there’s an obligation to give back. It’s a great pleasure to me.”

www.insurancebusiness.ca

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CAREER PATH

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PEOPLE

OTHER LIFE

TELL US ABOUT YOUR OTHER LIFE Email insurancebusiness@kmimedia.ca

5

Number of Stampedes in which Kat has participated

12

Number of volunteers on Kat’s team

4am

Time Kat’s day kicks off on parade day

BRAD

STAMPEDING ALONG She might specialize in social media with an insurance bent, but for Kat Macaulay summer means Stampede SUMMER IN Calgary is inextricably wrapped up with Stampede – the western city’s annual festival famous for its rodeos and chuck wagon races. And zipping around the parade – the opening event of the carnival that bills itself as The Greatest Outdoor Show on Earth – is Kat Macaulay.

The social media specialist holds the position of sub-chair, parade media and communications and is one of 125 year-round volunteers.

Working with her are a team of coordinators who are divided into various departments, such as

media, broadcast, promotions and social media.

While the months from September to January might require as little as 10 hours of Stampede prep, as early as February “things ramp up”, says Kat. “June is a complete write-off for me. We have meetings, deadlines; we work to get the line-up published [in local media]. I couldn’t even tell you how many hours we spend in June.”

The parade itself takes place on the first Friday in July, and showcases more than 150 western-themed entries, including 30 marching bands, 40 floats, 750 horses and 4,000 people. But for Kat the event is dominated by wrangling interviews for media outlets while the procession is under way.

“And after that it’s calm. After that we can breathe a sigh of relief,” she says.

“In the five years I’ve been involved, our team has grown both our media and social-media coverage.

It’s been an amazing experience. I feel really lucky to have learned as much as I have, and to have been involved in a world-class event. I’ve made some wonderful friends through it, too.”

One thing Kat has not managed in the past five years: to see the parade on the day.

“I always watch the replay the next day,” she says.

www.insurancebusiness.ca 47

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FEATURES

EXPERT ADVICE

Lean management Shari Douglas from RSA Canada explains why lean management is integral to meeting the challenges of the changing customer landscape

THE WORLD is changing at a pace never seen before. Technology is disrupting the way we live our lives, which is impacting consumer behaviour and expectations – from an increased propensity to making online purchases and engaging with brands on a 24/7 cycle, to demanding a more customized product experience.

Given this enormous shift in the market, brokers need to evolve. They need to meet and exceed these shifting customer expectations by changing the existing paradigm when it comes to customer service and building trust.

Lean management advantage

–

business

Lean management represents a business approach focused on challenging the way things

48

are done and committing to continuous improvement to eliminate waste and inefficiency.

According to McKinsey & Company, lean management seeks to refine a company’s basic systems to meet changing customer needs more effectively and is supported by a set of tools and techniques that shape day-to-day work for managers and front-line employees throughout the organization.

The environment in which an organization operates will continue to change; lean processes can help organizations address this challenge.

Applying lean principles can provide an organization with a clear competitive advantage through substantial benefits that include higher productivity, more seamless operations, reduced costs and improved quality of service to customers.

Redefining customer service Lean has application across a wide variety of industries – from manufacturing to financial services. In the insurance industry, when insurers streamline operations it can mean faster service provided to brokers, who can in turn better serve their customers. RSA Canada has been applying lean principles across a number of business processes since 2015, in an effort to elevate the company’s service level.

“A key component of being a market of choice for our broker partners has been the adoption and implementation of lean management practices into all our front-line operations,” says Shari Douglas, vice president, national underwriting operations, personal lines at RSA Canada.

RSA consolidated its underwriting functions into three hubs across Canada – Ontario, BC and Quebec. This has allowed teams of people doing similar work to be located together so that lean management process improvements can be implemented to increase the speed of underwriting decision-making at the front line.

“We have learned a lot along the way and we want to share our experience with brokers, as we believe they can also find ways to adopt aspects of lean management to create efficiencies in their brokerages,” says Douglas.

Lean management is changing the way organizations like RSA work, because the approach is empowering people to identify and solve what’s not working, as well as identify what is working and replicate it in other areas to ensure customers are serviced even better. It’s all about improving process and driving efficiencies.

Douglas would encourage any brokerage to consider the benefits of implementing lean management, and also offers some advice to get them through the process: • Don’t change for change itself. Listen to what your front-line employees are telling you and focus on the quick wins.

• Communicate. Look for new and creative ways to communicate. It is better to over-communicate than leave people wondering. Also listen to employee feedback and respond.

• Challenge often. Don’t be afraid to change things along the way. Be bold and take calculated risks.

www.insurancebusiness.ca

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