The CHART Exchange October 2020 by The CHART Exchange

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California Legislation To Include “Rebuttable Presumptions” supporting Covid-19 Business

NJ Law Expands Access To Workers’ Comp For Essential Employees Infected With Covid-19

EEOC Guidance: CV-19 Inquiries, Confidentiality, Accommodations, Furloughs & Discrimination

Case Study: Dive Into Automation: Scuba Insurance

U.S. Dept. of Labor School Reopening & Paid Leave Guidance

Glenn W. Clark, CPCU, Publisher CHART Exchange Earliest Adopter

The Problem of Cyber Risk and How Our Students Will Help Solve Them

2020: The Year of The Pandemic - And The Light At The End Of The Tunnel

Lloyd’s Launches New Culture Dashboard & Sets Gender Target For Market

Analysis Kroll: Return To Work Employee Training

U.S. Dept. of Labor Remote Work Guidance: Tracking Compensable Time

Lloyd’s Launches “First -Of-Its-Kind Business Interruption Insurance

What Data Should Lloyd’s Coverholders And MGAs Be Providing Capacity Providers?

Lloyd’s To Insure Transportation of CV19 Vaccine To Emerging Economies

The Future Of Insurance Is Algorithms

Cover Image: The image is released free of copyrights under Creative Commons CC0.

Covid-19 Brings Intangible Assets Into Full Focus

5-Star Reviews Are Great, But Critical Feedback Can Make You Better

The CMMC: Another Layer Of Our Nationâ&#x20AC;&#x2122;s Defense And A Chain Of Compliance

The Role of the Independent Agent as Learning Pods Gain Popularity

CASE STUDY: PG 21

Publisher: CHART Exchange Glenn W. Clark, CPCU Membership Services Kate Boyle Advertising: Kate Boyle Managing Editor: Kate Boyle Contributing Editor: Frank Huver

DIVE INTO AUTOMATION: A SCUBA INSURANCE CASE STUDY PREFER TO READ IN PDF FORMAT? DOWNLOAD THE PDF VERSION HERE

OCTOBER 2020 VOLUME 5 - ISSUE 3

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info@chart-exchange.com 3001 Philadelphia Pike Claymont, Delaware 19703 www.chart-exchange.com 302-765-6001 Last Issue:

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MESSAGE FROM THE EARLIEST ADOPTER

2020: THE YEAR OF THE PANDEMIC Lloyd’s is open for business…and CHART 2.0 is ready to assist domestic agency specialists submit their new program or product ideas to the market. Our group has been an advocate for the U.S./ London marketplace for nearly five years. The recent 2.0 “reboot” resulted in a shift away from a collegial association model in favor of a more client-centric approach.“

6 OCTOBER 2020

Glenn W. Clark, CPCU Publisher & Earliest Adopter

THERE IS FINALLY LIGHT AT THE END OF THE TUNNEL!

020 will always be remembered as the year of the pandemic. The impact of COVID-19 was felt on an international scale; even a venerable institution like Lloyd’s of London was forced to cease their time-honored tradition of Underwriters meeting with brokers face-to-face for the sake of public health and safety. Fortunately, alternative means of communications – video conferencing, e-mails, telephone calls, etc – allowed the market to continue transacting business.

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There is finally light at the end of the tunnel. After a nearly six month hiatus, the 334 yearold insurance stalwart has re-opened its underwriting room. While social distancing protocols have resulted in limited capacity, it is gratifying to see things beginning to make a return toward normalcy. Lloyd’s is open for business… and CHART 2.0 is ready to assist domestic agency specialists submit their new program or product ideas to the market. Our group has been an advocate for the U.S./London marketplace for nearly five years. The recent 2.0 “reboot” resulted in a shift away from a collegial association model in favor of a more client-centric approach. Our new entity is unique in the industry in that we possess the tools, expertise, connections, and partners to guide our clients from program conception through

to execution. Our partners can help with legal issues, forms development, program submissions, and placement (London/US). CHART 2.0 services also include the capability to grow your programs via www. chartmarkets.com, CHART MGA, and CHART Magazine. Twenty years as a Coverholder (tribunalized to do business for Lloyd’s of London) and five years of the CHART Exchange have produced the strategies and partnerships to assist our clients to successfully navigate a London strategy to increase your agency’s value. We would welcome the opportunity to assist you in partnering with the world’s oldest and most recognized

Glenn W. Clark , CPCU CHART’S Earliest Adopter

www.chart-exchange.com

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OCTOBER 2020

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ANALYSIS - KROLL

RETURN TO WORK EMPLOYEE TRAINING Learn about the training necessary to give employees before they return to work in this 2-minute security talk with Jeff Kernohan, associate managing director in Krollâ&#x20AC;&#x2122;s Security Risk Management practice.

www.chart-exchange.com

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OCTOBER 2020

THERE’S A BETTER WAY TO CONNECT WITH LONDON …

CHART CAN GET YOU THERE FASTER! Most of us know about Lloyd’s of London. The market’s 332 year track record of innovation, technical expertise, and product diversity has cemented its reputation within the industry. Unfortunately, the vast majority of U.S.-based agencies with new program or product ideas are unsure of how to access the world’s oldest insurance brand. The CHART Exchange can help. We were established for the sole purpose of growing the U.S./London marketplace by serving as the conduit between domestic producers and Lloyd’s Risk Takers. Our vast network of Vendor Partners can provide the support needed to help develop your program proposal. Available services include Actuarial, Claims Administration, Marketing, Legal, and Systems. We can even assist in expediting the implementation of your new program through our unique “Incubator” facility. Interested in learning more? Visit our website at www.chart-exchange.com. We are also available via e-mail (info@chart-exchange.com) or by phone at the number below.

855-716-3660 The CHART Exchange 3001 Philadelphia Pike Claymont, DE 19703 www.chart-exchange.com • Fax: (302) 334-0325

NEWS - LLOYD’S OF LONDON

LLOYD’S LAUNCHES “FIRSTOF-ITS-KIND” BUSINESS INTERRUPTION INSURANCE

loyd’s has launched a new “first-of-its-kind” business interruption policy for small and medium sized enterprises (SMEs), specifically designed to protect them against IT disruption or downtime. Parametrix Insurance offers simple and reliable coverage by removing the traditional indemnity trigger that most insurance policies today use. Instead, the new solution uses a parametric trigger, meaning that the policy automatically pays out if a customer’s critical IT services – such as cloud, e-commerce or payment systems – are disrupted. This significantly reduces the time insurers spend assessing a loss or adjusting a claim.

to disruption. As a result, critical technology downtime has become the fastest growing risk for businesses today, whether you are a technology company or not. On top of this, the existing claims process in the field is complicated, expensive and time consuming.

The new product is led by Tokio Marine Kiln (TMK) and supported by other members of Lloyd’s Product Innovation Facility including RenaissanceRe. It is the first off-theshelf parametric IT downtime policy tailored towards SMEs.

“Parametrix’s approach addresses all these issues, providing a solution that saves both time and money, while making tech insurance accessible to new business segments. We are thrilled to launch the first ‘off-theshelf’ parametric insurance product for IT downtime. This is a great milestone for us and we are grateful to TMK, Howden and Lloyd’s Product Innovation Facility for helping us to develop our product and providing us with valuable insights and support along the way.”

Yonatan Hatzor, Co-founder and CEO of Parametrix Insurance, said, “Businesses have shifted to managing most of their critical IT operations by using third-party service providers, thereby increasing their vulnerability

Trevor Maynard, Lloyd’s Head of Innovation, commented, “We know that insurance products and services have to evolve to respond to the challenges of the COVID-19 pandemic and help our customers cover new

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or heightened risks that they may encounter now or in the future. That is why Lloyd’s Product Innovation Facility and our new Lloyd’s Lab cohort are both looking at ways the industry can do this more effectively. I am delighted to see evidence of this today with the launch of Parametrix.” Tom Hoad, Head of Innovation at Tokio Marine Kiln and Chair of the Product Innovation Facility, added, “Third party cloud service providers help our clients trade within an ever-changing world and Parametrix have done a great job in developing an insurance product that helps build resilience in this space. We hope that the PIF BETA (comprising TMK, RenaissanceRe and others), which is supporting Parametrix Insurance with underwriting capacity, continues to be an effective accelerator for other technology-driven product solutions.” David Rees, Cyber broker at Howden explained, “It is very exciting to work with the Lloyd’s Product Innovation Facility and the PIF BETA led by Tokio Marine Kiln on this ground-breaking project, which combines the best of Lloyd’s product innovation and capacity, as well as working with our market leading cyber capability in Howden Israel led by Shay Simkin.” OCTOBER 2020

ANALYSIS - PERRENIAL

WHAT DATA SHOULD LLOYD’S COVERHOLDERS AND MGAS BE PROVIDING TO CAPACITY PROVIDERS? By Asad Khalil

bout the author: Asad Khalil is a qualified actuary with over 10 years’ experience and is the Managing Director and Founder of Perrenial. He specializes in London Market Pricing and carrying out binding authority profitability reviews of MGAs and Lloyd’s Coverholders for Lloyd’s syndicates. He is also on the Lloyd’s list of independent reviewers.

aving worked with a number of MGAs and reviewed numerous binders I thought I would share my thoughts on what I have seen in the market. What is very clear is that is a large variation in the quality of data being provided, some very good and some not so good. A) INDIVIDUAL LOSS DATA

For any type of binding/delegated authority business the capacity provider would want some assurances around the performance of the binder. An annual review usually takes place to determine what the historical performance has been like and what it is likely to be for the following year.

Whilst this should be readily available its rare that this level of granularity is provided. What is more common is a loss summary on an aggregated level. That is usually sufficient for a well performing binder/portfolio where limits and deductibles have remained stable over the years.

This is where the data of a Coverholder or MGA will end up on the desk of an actuary. There will be a basic list of data requirements which include but are not limited to the following:

However if loss experience has deteriorated an individual claims listing can help identify the types of claims impacting the binder/ portfolio. This type of granular data will also make it easier to use more sophisticated frequency/severity

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modelling techniques. B) LIST OF LARGE LOSSES If the individual claims data is provided the large losses can be identified from this. If a claims summary is only provided then large losses would need to be identified as they would be trended differently in the modelling process. C) TRIANGULATIONS Triangulations for claim numbers and incurred claim amounts allow the actuaries the project the claims See Coverholder & MGA Data Page 27

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ACTUARIAL SERVICES FOR LLOYDâ&#x20AC;&#x2122;S COVERHOLDERS LOSS RATIO PROJECTIONS CREATING AND UPDATING RATING MODELS PORTFOLIO OPTIMIZATION

Asad Khalil, FIA - Managing Director Mobile: +44(0)7399 025 851 Email: asad.khalil@perrenial.co.uk

www.perrenial.co.uk

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ANALYSIS - WILSON ELSER

CALIFORNIA LEGISLATION TO INCLUDE “REBUTTABLE PRESUMPTIONS” SUPPORTING COVID-19 BUSINESS bY Paul S. White, Siobhán A. Breen

On June 29, 2020, the California Legislature amended California Assembly Bill 1552 (AB 1552) to address purported insurance recovery for COVID-19 losses. Pursuant to the language of AB 1552, the bill was designed to “protect the solvency of businesses

that were forced to close their doors or limit business” due to the COVID-19 pandemic. As amended, AB 1552 would create three rebuttable presumptions affecting the burden of proof in a case in which the insured alleges that its business was interrupted due to the COVID-19 pandemic:

•

First, with respect to coverage for general business interruption and extra expenses, AB 1552 would create a rebuttable presumption that “COVID-19 was present on the insured’s property and caused physical damage to that property, which was the See CA Legislation Page 37

bout the co-author: Paul White focuses his practice on complex insurance coverage and bad faith litigation and represents defendants in commercial litigation. Paul’s insurance coverage practice includes advising and representing insurers in bad faith litigation and insurance policy disputes, including first-party property policies, general liability coverage, errors and omissions insurance, and media liability insurance. He also advises and represents insurers in subrogation actions on property losses. In addition, Paul has litigated and arbitrated disputes throughout the United States involving domestic and foreign insurance agents and brokers in all lines of coverage. He has broad experience in the business practices of all types of insurance intermediaries, including brokers at every level in the broking process, from producers to managing general agents to London Market brokers.

bout the co-author: Siobhán A. Breen represents primary and excess professional liability insurers and drafts coverage opinions with respect to complex insurance coverage matters involving directors and officers liability, errors and omissions liability, miscellaneous professional liability, lawyers professional liability, and employment practices liability. Prior to joining Wilson Elser, Siobhán’s practice consisted of insurance coverage and insurance defense litigation. Siobhán has experience in securities class actions, shareholder derivative actions, cyber/privacy actions, and professional malpractice actions for public and private companies.

www.chart-exchange.com

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OCTOBER 2020

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As a CHART vendor partner, Fortegra’s admitted paper helps coverholders and MGAs gain access to premier markets. Learn how Fortegra’s admitted program can help you Experience More at fortegra.com/programs, or via email at programs@fortegra.com. Fortegra® is the marketing name for the specialty underwriting operations of Fortegra Financial Corporation and its subsidiaries. Specialty underwriting program availability varies by jurisdiction. Where available, the programs are underwritten by admitted insurance companies.

ANALYSIS - WILSON ELSER

NJ LAW EXPANDS ACCESS TO WORKERS’ COMP BENEFITS FOR ESSENTIAL EMPLOYEES INFECTED WITH COVID-19 Author: Andrew J. Heck

n September 14, 2020, New Jersey Governor Phil Murphy signed into law Senate Bill 2380 (S2380), dramatically expanding access to workers’ compensation benefits for workers infected with COVID-19. Retroactive to March 9, 2020, COVID19-positive workers in New Jersey who qualify as “essential employees” are now entitled to a rebuttable presumption that the employee’s infection is causally related to the employee’s employment, so long as the infected individuals worked somewhere other than their own residence at the time of infection.

This new law provides for a broad definition of “essential employees,” including not only employees in the public safety, health care, transportation, hospitality and retail industries but also any other employee defined as an “essential employee” in a state of emergency declaration. Employers and Workers’ Compensation carriers faced with claims for COVID-19 workers’ compensation benefits pursuant to this new law can attempt to rebut this presumption by demonstrating, on a preponderance of the evidence basis, that the worker was not exposed to the disease while working in the place of employment. Claims paid pursuant to this bill would be excluded from

consideration in calculating a given employer’s Experience Modification Factor, thereby negating any direct impact on that employer’s workers’ compensation premium. The enactment of this legislation significantly upends the handling of infectious disease claims in New Jersey’s workers’ compensation system. The rebuttable nature of the presumption of causation is largely illusory in that it requires an employer to prove a negative, i.e., that the employee was not exposed at work, particularly given the evolving understanding

See NJ Law Page 23

ndrew Heck has extensive experience defending general liability, transportation, product liability, construction defect and workers’ compensation claims in his diverse civil litigation practice. Andrew has defended clients in those fields in a wide variety of settings, including against claims of catastrophic injury and wrongful death. Andrew provides his clients with the best possible representation by combining his understanding of their industry and operational concerns with his knowledge of the legal issues implicated in those fields in order to anticipate client needs, exceed expectations, and deliver clear and reasoned handling recommendations on a caseby-case basis ranging from early alternate dispute resolution to trial.

www.chart-exchange.com

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OCTOBER 2020

ANALYSIS - WILSON ELSER

EEOC GUIDANCE: COVID-19 INQUIRIES, CONFIDENTIALITY, ACCOMMODATIONS, FURLOUGHS AND DISCRIMINATION By Laura A. Stutz

layoffs; and age discrimination in flexible work arrangements.

n September 8, 2020, the Equal Employment Opportunity Commission (EEOC) issued updates to its technical assistance guidance to clarify its position on common workplace issues as businesses begin to resume in-person operations. The guidance appears in questionand-answer format with updates to address workplace COVID-19 testing and inquiries; maintenance of Americans with Disabilities Act (ADA) confidentiality; requests for accommodation; furloughs and

Permissible workplace COVID-19 tests and inquiries. COVID-19 testing administered by employers consistent with current guidance issued by the Centers for Disease Control and Prevention (CDC), including temperature screenings, will meet the ADA’s “business necessity standard.” Employers may ask all employees who will be physically present in the workplace if they have or had COVID-19 or symptoms associated with the virus, but may not ask whether the

employee has a family member who has or had COVID-19 or its symptoms. If an employee refuses to undergo a temperature screening or answer questions about whether the employee has COVID-19 or its symptoms, employers may ask about the reason for the refusal and then, if applicable, proceed as they would for any other request for an accommodation under the ADA. ADA confidentiality. The ADA requires that an employer keep

See EEOC Guidance Pg 30

bout the author: Laura Stutz practices in the area of employment law counseling and litigation. She represents management in the hospitality, retail, financial services and health care industries, including hospitals and hospital systems, nursing homes, clinical laboratories, acute care centers and retail pharmaceuticals. Laura’s practice involves counseling employers on employment laws and employee benefit issues arising under ERISA. She also litigates on behalf of management in state and federal courts and before administrative agencies over disputes involving claims of discrimination, harassment, wrongful discharge, retaliation, whistleblowing, wage-and-hour noncompliance, misappropriation of trade secrets, and enforcement of non-competition and nonsolicitation agreements.

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OCTOBER 2020

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CASE STUDY - E.O.X. VANTAGE

DIVE INTO AUTOMATION: A SCUBA INSURANCE CASE STUDY by Mike Fieseler

t’s all about speed in 2020—speed to market for program development and implementation, faster turnarounds on queries from prospects and in delivering policies, quicker responsiveness to grow customer satisfaction and retention. Insurers know they must increase their speed, but where do these improvements come from?

About the Author: Mike Fieseler is the VP of Business Development for E.O.X. Vantage With over 20 years of experience in insurance and technology, Mike joined the VA Sales team in 2010. Mr. Fieseler majored in Marketing and Management Science at the University of Iowa and has over 2,000 hours of continuing education including a Six Sigma Green Belt, Operational Excellence Level I, CPC, and ITIL training.

www.chart-exchange.com

One way is to work faster, smarter and better by revamping workflows. Analyzing and mapping existing workflows will lead you to understand how to streamline for more efficient workways. From this point you can transition them from manual, errorprone, people-performed processes to automated ones for businesstransforming speed and accuracy improvements. Refining and automating inefficient workflows and time-consuming processes is another solution for picking up speed and gaining productivity in basic business functions, team member throughput and ultimately operations across the entire organization. To illustrate the benefits of automation, let’s take a

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look at how EOX Vantage helped a client that was falling behind in the race. Vicencia & Buckley is a brokerage wing of HUB International, an intermediary between a specialty insurer and their clients: Scuba diving instructors. When we started working with them, their policy processes were not conducive to an agile, speed-optimized business model. Their legacy process was for applicants to fill out a form on their website that got converted to text and emailed to a CSR. The CSR copied the data into a system and had to contact applicants for any missing data, an inefficient and timeconsuming workflow. In a different system, the CSR checked an outside database if the applicant was certified by PADI, the leading Scuba training organization. But they still weren’t done! The CSR also had to process payment by contacting the applicant for credit card information, which was insecure and not compliant with PCI standards. Meanwhile, customers would have to contact a CSR for endorsements, COIs or other changes.

See Scuba Insurance Case Study Pg 28 OCTOBER 2020

ANALYSIS - WILSON ELSER

U.S. DEPARTMENT OF LABOR SCHOOL REOPENING AND PAID LEAVE GUIDANCE By Laura A. Stutz

n August 27, 2020, the U.S. Department of Laborâ&#x20AC;&#x2122;s Wage and Hour Division (WHD) issued guidance for employers and employees about qualifying for paid leave under the Families First Coronavirus Response Act (FFCRA) related to the reopening of schools. The guidance appears in question-and-answer format (FAQs) with updates to address eligibility for paid leave under the FFCRA relative to the remote and in-person learning formats schools have announced as they plan to reopen. The FFCRA permits eligible employees to take up to 2 weeks of paid sick leave and up to 12 weeks of expanded family and medical

leave, 10 of which are paid, for specific reasons related to COVID-19. Eligible employees may take both types of paid leave to care for their children whose school or place of care is closed, or whose child care provider is unavailable due to COVID-19-related reasons. The new FAQs address whether employees may qualify for paid leave when a child attends a school operating on an alternate-day basis, when a parent chooses remote learning even though in-person instruction is available, and when a school begins the academic year with remote learning but shifts to in-person instruction if conditions permit. SPECIFICALLY: Alternate-day learning formats include situations where a school is open each day but students

alternate between attending school in person and participating in remote learning. Employees are eligible for paid leave under the FFCRA on those days the child must participate in remote learning, so long as the employee needs the leave to care for his or her child and only if no other suitable person is available to do so. Voluntary remote-learning formats include situations where schools provide parents a choice between having their child attend in person or participate in a remote-learning program. Employees who have chosen remote learning due to a generalized fear that their child may contract COVID-19 are not See School Reopening Guidance Pg 40

bout the author: Laura Stutz practices in the area of employment law counseling and litigation. She represents management in the hospitality, retail, financial services and health care industries, including hospitals and hospital systems, nursing homes, clinical laboratories, acute care centers and retail pharmaceuticals. Lauraâ&#x20AC;&#x2122;s practice involves counseling employers on employment laws and employee benefit issues arising under ERISA. She also litigates on behalf of management in state and federal courts and before administrative agencies over disputes involving claims of discrimination, harassment, wrongful discharge, retaliation, whistleblowing, wage-and-hour noncompliance, misappropriation of trade secrets, and enforcement of non-competition and nonsolicitation agreements.

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ANALYSIS - WILSON ELSER Continued From Page 17

Continued From Page 18

NJ LAW EXPANDS ACCESS TO WORKERS’ COMP BENEFITS

EEOC GUIDANCE: COVID-19 INQUIRIES, CONFIDENTIALITY, ACCOMMODATIONS, FURLOUGHS AND DISCRIMINATION

of the relative rate of infections arising from asymptomatic or pre-symptomatic carriers of this disease, as well as the unfortunate ubiquity of the disease among the public at large.

all medical information about an employee confidential and store it separately from personnel files. The exchange or receipt of medical information during remote work does not create an exception to this requirement.

Moreover, attempting to rebut that presumption potentially raises significant privacy issues, including reliance on the protected health information of co-workers. Although premium increases are not permitted to be correlated directly to a given employer based on that employer’s sick workers, it is highly likely that premiums will ultimately rise across the board given the scope of newly compensable benefits contemplated by this new law.

Managers and supervisors who receive employees’ medical information while working remotely must continue to safeguard this information in accordance with the employer’s policies. ADA confidentiality does not prevent coworkers or managers from making necessary and required internal reports of an employee who has symptoms of COVID-19 or who has tested positive for the virus. ADA confidentiality also does not prohibit disclosure that an employee is working remotely or on leave, but the employer cannot disclose the reason for the leave.

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Requests for accommodation. Employers are not required to accommodate every employee with a remote work arrangement or permanently change essential job functions to enable a remote work arrangement merely because the employer did so when it closed its workplace and/or implemented temporary remote work arrangements to mitigate against the spread of COVID-19. Rather, employers and employees should proceed as they would for any other request for an accommodation under the ADA, i.e., engage in a flexible, cooperative interactive process. Furloughs and layoffs. When planning furloughs and layoffs, employers are reminded that the

See EEOC Guidance Page 37 OCTOBER 2020

ANALYSIS - JENNIFER ROTHSTEIN

THE PROBLEM OF CYBER RISK AND HOW OUR STUDENTS WILL HELP SOLVE THEM By Jennifer Rothstein

When you teach, you learn. One of the ways you know you have a grasp on the material is when you are able to teach it to others. But when you become a teacher, you also become a student and start to learn from the students who are in your class. In the discipline of cyber risk, it is important now more

than ever to learn from our future generation of problem solvers and cybercrime defenders.

Students are attracted to the discipline of cyber security because it’s interesting, important and quite frankly, terrifying at times. Our next generation of cyber professionals have grown up in a digital, interconnected world; they have enjoyed the conveniences About the Author: of constant Jennifer Rothstein is the Business communication, Development Head, accessible Insurance & Legal, entertainment and for BlueVoyant, a remote working cybersecurity provider headquartered in New environments York City. She also before it was co-founded and serves necessary. as the President of

Women in Cyber Leadership Corp. As the cyber security industry has been rooted in STEM and the military, she recognized that it can be intimidating for women to start and thrive within the space, and has dedicated her efforts to providing everyone with the tools, opportunity, knowledge and confidence to succeed in cyber. Throughout her career at companies such as Kroll and AIG, she has lead the effort in combining cyber expertise with her deep knowledge in insurance. She is driven by a resolve to demystify two complex categories allowing access and understanding to both cybersecurity and insurance in our increasingly interdisciplinary and interconnected world.

24 OCTOBER 2020

The students come to class having advised older family members of the dangers of phishing emails or social engineering attempts. They commiserate with each other about cyber bullying attempts during an on-line video game

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As professionals, educators and leaders, we need to support our future generation through mentorship, accessible education and training to welcome them to the industry. As much as we have to teach them, they have a substantial amount to teach us as well and for that, we should all be grateful.” or having had their passwords stolen. Some have learned how to code; some have learned about cryptocurrency. When they start to learn about the history of cyber security, they respond with awe when they think about how long these risks have existed – even before they ever used their first computer.

See Students Will Solve Cyber Risk Pg 41 www.chart-exchange.com

“WHEN YOU’RE FINISHED CHANGING,

YOU’RE FINISHED” - Benjamin Franklin

Benjamin Franklin: Scientist, philosopher, Founding Father … and business strategist? Mr. Franklin’s advice about adapting to thrive is especially appropriate in the highly ﬂuid insurance industry. The CHART Exchange began with a good idea back in 2015: become the catalyst for growth in the U.S./London marketplace by facilitating interaction between domestic wholesalers/agency specialists and Syndicate underwriters. Large-scale networking events were held annually in elegant venues. While this approach produced results, feedback from the meeting participants indicated we could do much more to achieve our goal. As a direct result of this feedback, CHART 2.0 adopted a more proactive operating model intended to provide advocacy-level support to U.S.-based agencies seeking to place business within the London market. The expertise of our various Vendor Partners — when combined with new brokerage placement capabilities — gives CHART 2.0 clients access to a broad array of services they need to be successful. Interested in learning more? Visit our website at www.chart-exchange.com. We are also available via e-mail (info@chart-exchange.com) or by phone at the number below.

www.chart-exchange.com

The CHART Exchange, 3001 Philadelphia Pike Claymont, DE 19703

Phone: (855) 716-3660

•

Fax: (302) 334-0325

ANALYSIS - PERRENIAL Continued From Page 12

WHAT DATA SHOULD LLOYD’S COVERHOLDERS AND MGAS BE PROVIDING TO CAPACITY PROVIDERS?

the sum insured values are usually available due to potential catastrophe exposure, however it is mostly only provided for the current year. That said if the capacity provider has stored this information every year at renewal, they should be able to put this together. This information will allow the actuaries to spot trends and provide more beneficial insights into how performance can be improved. F) OTHER INFORMATION

to amounts they will eventually settle to. If these are not provided then benchmarks development patterns will be used, if these patterns develop slower than the actual experience of the binder then the actuaries projection of the performance will be worse than what the Coverholder/MGA expect.

Carrier expenses, Brokerage and MGA/Coverholder fees are also very useful for the actuary to know as this will allow them to work out what the combined loss ratio is and to determine if it

makes sense for the carrier to renew the capacity of the MGA/Coverholder. Whilst what has been mentioned above may sound very basic, its importance cannot be overstated. In the absence of key information, actuaries will almost certainly incorporate a conservative set of assumptions which will increase the MGA’s/Coverholder’s forecast Gross Loss Ratio and reduce their chances of renewing their capacity. With the market hardening and capacity being restricted MGAs and Coverholders need to take ownership of their data and truly understand the level of profitability of their binder. Those who invest in data and analytics are perfectly placed to gain market share in a time when premiums are increasing and the market is changing.

D) GROSS WRITTEN PREMIUM AND RATE CHANGE GWP for the historical and the forthcoming year is almost always provided. What is often missing is the corresponding rate change information which is needed to calculate the on-level gross written premiums. E) TRUE UNDERLYING EXPOSURE For lines of business such as property www.chart-exchange.com

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OCTOBER 2020

CASE STUDY - EOX VANTAGE Continued From Page 21

DIVE INTO AUTOMATION: A SCUBA INSURANCE CASE STUDY Numerous disadvantages and deficiencies combined here to create operational breakdowns: foremost the duplication of efforts and switching between multiple systems. Not to mention the outdated system was unreliable and prone to crashing when more than one application was handled at a time, and could not be worked on remotely without a VPN connection. This all led to slow policy turnarounds, multiple inefficiencies throughout the whole process and complex, convoluted workflows due to back-end workarounds. After examining the parameters, our objective became to build an online self-service Scuba insurance procurement platform aligned with HUB’s digital strategy. Our design included developing the following components. Taken as a whole, you might have seen this streamlined approach that promotes efficient data collection and eliminates redundant data inputs referred to as “straight-through processing.” •

•

a portal for agents (/CSRs) to respond to new applicants, search and manage all existing policies, and verify PADI certification in one platform a portal for insureds that includes a way to self-serve for endorsements

28 OCTOBER 2020

•

• •

•

and renewals, taking care of a major pain point dynamic forms to simplify application submission and ensure complete, accurate data by not making the customer fill in all information and any gaps risk rating engine payment gateway to enable secure collections and decrease collection times to speed up the payment cycle document viewer for an easy way to see attachments, certifications, etc.

Automating many aspects of the problematic program practices and bringing them all under one platform also allowed us to easily integrate the system with PADI and a leading payment services provider. The new system has paid off handsomely. Looking at the numbers, in 2019 it took HUB 1,781 hours to complete data entry alone for nearly 8,000 policies – not counting going back and forth with prospects for information, etc., which surely added many more hours. During the peak U.S. season (summer), a staff of four worked eight to ten hours per day strictly on data entry, and in some cases they even needed to pull staff from other departments. These team members included executives and others whose time and efforts could have been more effectively used in other TABLE OF CONTENTS

endeavors to help the business more optimally. Our new system is tracking to provide a 70% decrease in manual data entry time and an 80% faster policy turnaround time. These equate to an estimated savings of tens of thousands of dollars a year. Perhaps even better, the ability to process more applicants and service more people in a faster and better fashion should increase customer satisfaction and sales. In addition, the system is now much more reliable. It’s also simpler to use, especially for dispersed team members who can easily connect to the web-based platform. An overlooked time-saving feature of automation is that it can transform your operation into a 24/7 shop—with processes going on around the clock and outside of the normal business hours of team members who would conduct the same actions—to accommodate the many people who want to shop for things like insurance outside traditional business hours or on weekends. Such significant time savings lead to smoother operations, greater customer satisfaction and more loyal employees with less turnover. Team members who used to do the timeintensive procedures can be retrained and repurposed to perform more value-added activities for the business than data entry and the like. Automation is becoming more accessible and more affordable for businesses of all sizes and resources. It’s attainable even with a limited budget and constrained resources. With competition fiercer than ever and the pandemic stretching already strained resources, it’s time to give automation a try. www.chart-exchange.com

NEWS - LLOYD’S OF LONDON

LLOYD’S LAUNCHES NEW CULTURE DASHBOARD AND SETS GENDER TARGET FOR THE MARKET Lloyd’s, the world’s leading specialist insurance and reinsurance market, today published its new Culture Dashboard, alongside setting a gender target for the market supported by a commitment to achieve parity over the next decade.

hese measures mark the fulfilment of Lloyd’s 2019 commitments to drive longterm culture change across the Lloyd’s market, and form the foundation of ongoing initiatives to build a more inclusive environment. The Lloyd’s Culture Dashboard* will be updated annually and is informed by data gathered from the largest ever culture survey in the sector undertaken for the first time last year, as well as market participant data across key demographic characteristics. It benchmarks www.chart-exchange.com

the market’s starting point and is intended to transparently track Lloyd’s collective progress towards a much more inclusive environment. The Dashboard will be an evolving representation of the market’s progress across key culture indicators. It presents the current view of gender, ethnicity, sexual orientation and disability, alongside the importance of culture within individual firms. Lloyd’s recognises that there is more work to be done to build and improve its data and in doing so ensure that it is presenting the most accurate view of where the market stands collectively. As part of the Corporation’s commitment to improve market data and measure progress, Lloyd’s will be running its annual Culture Survey for the second time, in October this year. Alongside the Dashboard, Lloyd’s also announced the setting of an interim target of 35% female representation in leadership positions to be achieved by 31 December 2023 (Board, ExCo, ExCo Direct Report). In addition, Boards and Executive Committees combined will be expected to achieve at least 20%

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Creating an inclusive and high-performing culture is fundamental to the future success of our marketplace. To get there we must be brave in our actions to accelerate change, and transparent in how we measure our progress and hold ourselves to account. The setting of a gender target, with a commitment to parity in the next decade, together with presenting an honest view of our starting point, represents an important step towards that critical goal.” female representation by the end of 2023. New market entrants will be expected to meet these expectations on arrival. The Lloyd’s Corporation has already taken action, with 47% of its leadership roles being filled by women. The market target will drive an improvement in the gender

See Lloyd’s Culture Dashboard Page 36 OCTOBER 2020

Bringing U.S. Entrepreneurship to the London Market The CHART/Wilson Elser strategic partnership combines the innovative underwriting philosophy of the worldâ&#x20AC;&#x2122;s oldest insurance brand with the entrepreneurial mindset of U.S. agencies. For close to 40 years, Wilson Elser has helped organizations to better navigate challenging markets and realize improved combined ratios. We provide London- and Europe-based insurers with ready access to more than 60 discrete legal services delivered by nearly 800 attorneys in 34 strategic locations throughout the United States. Guided by a proprietary, systematic legal project management program, we help clients define strategies and achieve outcomes that align with agreed business requirements. We also implement dedicated Program Claim/Litigation Management services, creating value and driving efficiencies with respect to legal spend and indemnity. Wilson Elser is especially proud of its strategic partnership with CHART Exchange and our shared commitment to strengthening relationships between cover holders and risk takers on either side of the Atlantic.

ANALYSIS - WILSON ELSER

U.S. DEPARTMENT OF LABOR REMOTE WORK GUIDANCE: TRACKING COMPENSABLE TIME By Gregg S. Kahn & Laurea A. Stutz

n August 24, 2020, the U.S. Department of Labor’s Wage and Hour Division (WHD) issued new guidance on an employer’s obligation to track compensable time. Although the guidance was issued in response to the prevalence of remote working arrangements due to COVID-19, the guidance applies to all remote work arrangements. The new guidance reaffirms an employer’s obligation under the Fair Labor

Standards Act (FLSA) to track the number of hours of compensable work performed by employees who are working remotely to ensure those employees are compensated for all hours worked. Compensable time includes (1) work not requested but allowed and (2) work the employer knows or has reason to believe is being performed. The guidance is intended to clarify when an employer has constructive knowledge that work is being performed.

In determining whether an employer has constructive knowledge of additional unscheduled hours worked, the WHD recognizes that courts generally consider whether the employer should have acquired knowledge of such hours worked through reasonable diligence. Employers may exercise reasonable diligence by providing reporting procedures for nonscheduled time.

See Remote Work Guidance Page 35

bout the co-author: Gregg Kahn focuses his practice on labor and employment litigation, representing employers of all sizes. Gregg also devotes a substantial portion of his time to professional liability defense and real estate litigation. In his various roles over the course of his career, Gregg has counseled clients, handled complex litigation and coordinated litigation services on a nationwide basis. Gregg has successfully defended numerous property managers and real estate brokers before HUD and the New Jersey Division on Civil Rights against charges of various forms of discrimination. Additionally, Gregg previously served as national litigation counsel for a real estate brokerage company where he also handled housing discrimination matters.

bout the co-author: Laura Stutz practices in the area of employment law counseling and litigation. She represents management in the hospitality, retail, financial services and health care industries, including hospitals and hospital systems, nursing homes, clinical laboratories, acute care centers and retail pharmaceuticals. Laura’s practice involves counseling employers on employment laws and employee benefit issues arising under ERISA. She also litigates on behalf of management in state and federal courts and before administrative agencies over disputes involving claims of discrimination, harassment, wrongful discharge, retaliation, whistleblowing, wage-andhour noncompliance, misappropriation of trade secrets, and enforcement of noncompetition and non-solicitation agreements.

www.chart-exchange.com

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OCTOBER 2020

NEWS - LLOYD’S OF LONDON

LLOYD’S APPROVES NEW SPECIALISED SYNDICATE TO INSURE TRANSPORTATION OF COVID-19 VACCINE TO EMERGING ECONOMIES Lloyd’s, the world’s leading specialist insurance and reinsurance market, today announced the creation and in principle approval* of its newest “syndicate in a box,” Syndicate 1796, set up to insure the storage and transportation of a COVID-19 vaccine once developed to emerging economies.

his important initiative forms part of Lloyd’s response to the far-reaching impacts of the pandemic, following the publication of its recent Report and open source frameworks**. Syndicate 1796 has been developed by Parsyl, an insurance technology company and Lloyd’s Lab alumni, in close partnership with Ascot as

32 OCTOBER 2020

managing agent, and in cooperation with AXAL XL, McGill and Partners and Gavi, the Vaccine Alliance. The Syndicate forms the foundation of the new Global Health Risk Facility (GHRF) at Lloyd’s, which aims to provide comprehensive insurance and risk mitigation services to support the manufacturing and distribution of COVID-19 vaccine development efforts. It aims to start writing business from 1 October 2020. In the GHRF, Syndicate 1796 will be backed by development finance capital, allowing it to share risks with leading cargo syndicates, making better, fairly priced cargo coverage available. The GHRF will offer ‘All Risk’ cargo coverage for transit and storage risks on all global health products related to COVID-19 and any other infectious disease control and prevention programs. The creation of a public-private syndicate to address a global health emergency is the first in Lloyd’s 330-year history. Led by Ascot, the GHRF will take a portfolio approach, focusing TABLE OF CONTENTS

primarily on global distribution of products to low income countries supported by global public health agencies, such as Gavi, the Global Fund to Fight AIDS, TB and Malaria, PEPFAR and UNICEF. The GHRF will also offer coverage via direct insurance or reinsurance, for in-country distribution risks to ensure vaccines and other commodities are protected as they are stored in central warehouses and travel through health systems. Eligible insureds will include private manufacturers, procurement agents, logistics companies, Ministries of Health and other public agencies supporting the distribution of COVID-19 vaccines and other lifesaving products to low income countries. John Neal, CEO, Lloyd’s of London said: “There is broad consensus that life can only return to normality after a vaccine is developed, distributed and administered around the world.

See Covid-19 Vaccine Page 39 www.chart-exchange.com

ANALYSIS - MOTOSI

THE FUTURE OF INSURANCE IS ALGORITHMS By Paul Rich

he future of insurance is algorithms. In fact, let’s face it, pretty much the ‘future of everything’ is going to be based on algorithms in some form or other; we are ourselves, in essence, just a complex mix of ‘organic algorithms’ so the model and process management associated with algorithmic deployment is a somewhat tried and tested one. Our daily lives are increasingly about how the ‘organic’ interacts and is entwined with the ‘technical’ with the output plain to see across a wide variety of mediums and real world interactions as we engage and manage them to the best of our knowledge and ability. These few words you are reading now on a page, for example, will be posted

on an algorithmically engineered technology interface, socialised, and ultimately read by people who are part of the very same algorithmic ‘interface’, all of us utilising deeply entrenched and complex decision making at the organic level in the form of our own algorithmic make ups. It’s certainly a bit of a ‘rabbit hole’ to go down if you think of things at the philosophical level, however, I won’t indulge myself (or bore you) in that regard but will keep things framed

within an area I work and know, which is the London Market. Algorithms in the London Market, in some form or other, are not new. What is perhaps new is their application and deployment in an ever changing and developing marketplace. In this environment, the London market is striving to modernise and shape itself to realise the benefits of algorithmic adoption and the improved intelligence See Future of Insurance Page 38

bout the author: Paul Rich has an in-depth understanding of global (re)insurance markets, particularly the Lloyd’s and London Market. MOTOSI Consulting works with clients including Brokers, Managing Agents, and Coverholders in the Company and Lloyd’s markets to assist in the delivery of operational best practice and outcome excellence, always striving to improve business processes and delivering efficiencies utilising a blend of forward, pragmatic and focused thinking and where appropriate ‘best in breed’ tech, aiming to drive costs down and margins up. With extensive strategic engagement experience and being commercially adept at managing multitiered, complex business relationships and operating models; delivery is focused, strategic and measurable.

www.chart-exchange.com

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OCTOBER 2020

NEWS - LLOYD’S OF LONDON

COVID-19 BRINGS INTANGIBLE ASSETS INTO FULL FOCUS Intangible assets are an increasing proportion of companies’ balance sheets, already accounting for as much as 85% of the total business value across industries according to estimates. With the acceleration of digital business models, amplified by COVID-19, this value could now increase much further, becoming a major blind-spot for firms not factoring intangible assets into their risk models.

loyd’s, the world’s leading specialist insurance and reinsurance market, today published a report in collaboration with KPMG urging businesses to pay attention to the new risk landscape that has evolved under COVID-19. Protecting intangible assets: Preparing for a new reality looks at the increasing value of intangible assets, and the role of risk managers and the insurance industry in protecting them.

34 OCTOBER 2020

COVID-19 has disrupted global supply chains and moved the world towards de-globalisation. It has changed working arrangements, businesses’ ability to trade, and consumer behaviours. It has also created a new social contract between businesses and society and has accelerated underlying market trends such as the shift to remote workforces and digital transactions. The new report looks at how COVID-19 has increased companies’ exposure to new risks, many of which implicate the intangible assets held by businesses. With unprecedented scrutiny on firms’ behaviour, reputational issues are just one of many posing a threat to firms’ silience during the pandemic. TABLE OF CONTENTS

New ways of working are also presenting their own unique challenges, amplifying the complexity of managing intellectual property and conduct risk amongst a remote workforce. For businesses to stay resilient, operationally and financially, awareness of what intangible assets are and how they can be protected is critical and must form a considerable part of their risk management strategy. In the face of these amplified challenges, the Lloyd’s market is developing products to help organisations mitigate their exposure to risk, and the report outlines a range of examples of products already available in the market in response to the risks posed to reputation, human capital and intellectual property.

www.chart-exchange.com

It highlights the vital role the insurance community has to play in helping organisations manage these challenges so that they are better prepared to protect their assets. Dr. Trevor Maynard, head of Innovation at Lloyd’s said: “As an industry we need to recognise that the world has changed and adapt to how it looks now. COVID-19 has changed the risk landscape, exposing companies to new risks and encouraging companies to think about how they now operate. Whilst a range of insurance products already exist to help organisations manage their risks related to reputation, human capital, and intellectual property, it is important that at Lloyd’s we work together with the market to innovate and create new products to help customers mitigate risks and protect themselves from future threats.” Paul Merrey, partner, KPMG said: “As we move swiftly into the new reality, it’s apparent that many businesses aren’t adequately prepared for it. The key drivers of corporate value are completely different now to in the past, and this shift has only been amplified by COVID-19. Whilst physical assets are still a focus, recognition of what intangible assets are and how much they represent a firm’s value may come as a hard awakening for some organisations. In order to remain resilient and competitive, organisations across all industries must be proactive in finding new ways to enhance their business practices to protect these assets, and this will require a new way of thinking and acting.” www.chart-exchange.com

Continued From Page 31

U.S. DEPARTMENT OF LABOR REMOTE WORK GUIDANCE: TRACKING COMPENSABLE TIME If an employee fails to report unscheduled hours worked through the reporting procedure, the employer is not required to undertake impractical efforts to investigate further to uncover unreported hours of work, such as accessing nonpayroll records or tracking the employee’s access of work-issued electronic devices outside of reported hours. Employers are reminded that they must not prevent TABLE OF CONTENTS

or discourage employees from accurately reporting time worked and that employees may not waive their rights to compensation under the FLSA. To reduce the risk of potential FLSA violations, employers should adopt written time reporting policies requiring nonexempt employees to accurately record all time worked whether the time is worked on the employer’s premises or via remote work arrangements. The policies also should prohibit employees from performing work outside of normal work hours without prior written authorization and should include a ban on afterhours use of employer-provided electronic devices, e.g., computers and smartphones. Consideration also should be given to periodically reminding employees to accurately record time worked consistent with the employer’s policies.

OCTOBER 2020

NEWS - LLOYD’S OF LONDON Continued From Page 29

LLOYD’S LAUNCHES NEW CULTURE DASHBOARD AND SETS GENDER TARGET FOR THE MARKET balance in leadership roles across the market in the short-term, with Lloyd’s committing to a medium-term ambition for parity over the next decade. Lloyd’s is equally committed to increasing the representation of Black and Minority Ethnic colleagues across the market, and importantly across leadership roles. To support this, Lloyd’s is focusing on improving the collection of ethnicity data and other characteristics* to enable it to fully understand its starting point and set a market target for ethnicity in Q2 2021. This follows Lloyd’s five initial actions to help improve the experience of Black and Minority Ethnic talent across the market, published on 10 June**. John Neal, Lloyd’s CEO, said: “Last year, we committed to building a much more inclusive market – one that we are all deeply proud to be part of, and one that welcomes and represents the diversity of our customers globally. In the

36 OCTOBER 2020

Corporation, we have achieved parity in less than two years and we are all the better for it. While we have put in place a series of actions to accelerate change, it is abundantly clear that we have much work to do and we must be impatient in our resolve to get there. The Corporation will continue to do more in leading the market on all aspects of inclusion. Fiona Luck, Lloyd’s board member and non-executive director responsible for talent and culture, said: “Creating an inclusive and highperforming culture is fundamental to the future success of our marketplace. To get there we must be brave in our actions to accelerate change, and transparent in how we measure our progress and hold ourselves to account. The setting of a gender target, with a commitment to parity in the next decade, together with presenting an honest view of our starting point, represents an important step towards that critical goal.” TABLE OF CONTENTS

WOULD YOU LIKE TO HAVE YOUR MESSAGE DELIVERED TO 100,000+ FOCUSED INSURANCE INDUSTRY EMAIL ADDRESSES EVERY MONTH?

I’m Kate Boyle Managing Editor. I handle CHART Exchange Advertising. Call me at 302 765-6056 and let’s have a conversation.

www.chart-exchange.com

ANALYSIS - WLSON ELSER Continued From Page 15

Continued From Page 23

CALIFORNIA LEGISLATION EEOC TO INCLUDE “REBUTTABLE GUIDANCE: PRESUMPTIONS” COVID-19

INQUIRIES

direct cause of the business interruption.” •

•

Second, with respect to coverage for business interruption due to an order of civil authority, AB 1552 would create a rebuttable presumption that “COVID-19 was present on property located within the geographical location covered by the order of civil authority and caused physical damage to that property, which was the direct cause of the insured’s business interruption.” Third, with respect to coverage for business interruption due to impairment of ingress or egress, AB 1552 would create a rebuttable presumption that “COVID-19 was present on the property of a third party and caused physical damage to that property, which was the direct cause that prevented the ingress and egress to the insured’s property and resulted in the insured’s business interruption.” www.chart-exchange.com

Further, AB 1552 would “prohibit COVID-19 from being construed as a pollutant or contaminant for purposes of any exclusion within a commercial insurance policy unless viruses are expressly included in that exclusion policy language.” If enacted, AB 1552 would take “immediate effect” and apply retroactively to all commercial insurance policies providing coverage for business interruption that were in force and effect on and after March 4, 2020, which is the date that California Governor Newsom declared a state of emergency related to the COVID-19 pandemic.

Read details of bills from other states: • • • • •

New Jersey, Ohio, Massachusetts New York Louisiana Pennsylvania South Carolina TABLE OF CONTENTS

laws enforced by the EEOC prohibit the selection of an individual on the basis of a protected characteristic (e.g., race, color, religion, sex, age) or in retaliation for a protected activity. Age discrimination. Employers may not provide flexibility (e.g., telework, modified schedules) to employees if it results in older, comparable employees being treated less favorably based on age in comparison. There may be state and local legislative developments that could impact the guidance provided by the EEOC. Employers should consult legal counsel regarding specific circumstances for individualized legal advice on COVID-19-related return-to-work issues. If you have questions regarding the EEOC guidance, feel free to contact the author or a member of Wilson Elser’s Labor & Employment Practice.

OCTOBER 2020

ANALYSIS - MOTOSI Continued From Page 33

THE FUTURE OF INSURANCE IS ALGORITHMS lead decision-making and the commercial execution that comes as a result. This pathway of merging mind and technology in the London Market is perhaps some considerable way behind the rest of society and is

still some way off from realising the full potential and mutual benefits of such co-existence - but it is happening. We are seeing technology utilised in a variety of ways to face up to the challenges presented and to leverage and create opportunities for such relationships to come into being. This will only accelerate at an everincreasing pace. It will be down to the ‘market’ and the many different organisations operating in it to deliver the

38 OCTOBER 2020

environment in which such cooperation between humans and technology can co-exist. If we achieve such an environment, it will benefit all who operate in it as well as the global market and buyers of the products and services that emanate from it.

Each component part of the ecosystem that is being built will need to understand what part it plays in the delivery of ‘the process’ and provide the relevant data which will support the ‘collective algorithms’ that are required in order for it to work. Algorithms do not work in vacuums, whether they are organic, or silicon based, they require information upon which to apply the logic that drives them. In our market

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parlance this is really all about data and without correlated data, structured, coherent and actionable data, processes fail and we move nowhere really. Or, at the very least, fundamental market processes become paralysed and friction heavy through not being able to efficiently use and access its services; the very place we are coming from and attempting to remedy. Everyone should be encouraged and motivated by innovation and adventurous in their thinking in this regard. Embrace change but not blindly; engage technology

transformation but not wildly or thinking that it will fix all woes and challenges the market faces. Finally, deliver change with pragmatism and with a handle on reality for what can be achieved, given the context within which we are working. These are incredibly exciting times and we are only really at the very start of this part of the journey. The future is algorithms - the future is collaborative, and it is now.

www.chart-exchange.com

NEWS - LLOYD’S OF LONDON Continued From Page 32

LLOYD’S APPROVES NEW SPECIALISED SYNDICATE TO INSURE TRANSPORTATION OF COVID-19 VACCINE TO EMERGING ECONOMIES

provide a combination of coverage, incentives and data that can prevent losses from occurring and provide protection if they do.” Ben Hubbard, CEO of Parsyl said: “We’ve seen Lloyd’s stand behind risks to some of the world’s greatest achievements and innovations. We asked, why not find a way to stand behind the largest vaccine campaign in human history. The Global Health Risk Facility will do this by sharing risk and leveraging new data to unlock insurance solutions for high stakes vaccine distributions around the world.”

Andrew Brooks, CEO, Ascot Group, Lloyd’s has an important role to play of their income level and delivering said: “The GHRF is an excellent in insuring the many risks associated them so that they reach the groups example of how the insurance with this global medical response The Covid-19 crisis has industry is addressing previously and we are delighted to approve uninsured risks. Ascot and the escalated the need to wider insurance market has the a new innovative syndicate that will provide effective cover for improve the already underwriting expertise, but local vaccine distribution supply challenging global distribution to put together a facility such chains. This unique partnership of vaccines. By sharing data as this requires syndication, is a real demonstration of the infrastructure and market value and ingenuity the Lloyd’s and through innovative risk collaboration which Lloyd’s is market can bring to help address mitigation, this facility will play uniquely placed to deliver. Such a a global health emergency, as we a crucial role in ensuring that facility is enabled by high quality share risk to support the brave new entrants such as Parsyl efforts of those racing to develop vaccines travel safely through who have the ideas, technology and distribute a COVID-19 the global supply chain to all and data to deliver this positive vaccine.” humanitarian solution.” corners of the world.” Seth Berkeley, CEO of Gavi, the Vaccine Alliance said: “We are only protected if we are all protected. At Gavi we are starting to address the huge challenges in the race to safe, effective COVID-19 vaccines, such as manufacturing at scale, procuring doses for every country regardless www.chart-exchange.com

that need them most. Like with all other vaccines, these life-saving products are put at risk as they travel thousands of miles across the world to reach remote communities in Africa and Asia. I welcome this important initiative as it will

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Steve McGill, CEO, McGill and Partners said: “We are proud to support this critical initiative and be part of the largest movement of medical vaccines in history. At

See Covid-19 Vaccine Pg 43 OCTOBER 2020

ANALYSIS - WILSON ELSER Continued From Page 22

U.S. DEPARTMENT OF LABOR SCHOOL REOPENING AND PAID LEAVE GUIDANCE eligible for paid leave under the FFCRA, because the school is not “closed” due to COVID-19related reasons. Employees who have chosen the remote-learning option because their child is under a quarantine order or has been advised by a health care provider to self-quarantine may be eligible for paid leave under the FFCRA if the child is incapable of self-care and depends on the employee for care if providing care prevents the employee from working and teleworking. Changes in learning formats occur where schools have opened under a remote-learning program in the beginning of the school year but may change to in-person attendance when circumstances permit. Employees are eligible to take paid leave under the FFCRA during the period of remote learning. Whether employees will be eligible for paid leave under the FFCRA should

40 OCTOBER 2020

CHART DEFENDER COVERHOLDER E&O AVAILABLE NOW!

the school reopen for in-person attendance will depend on the particulars of the reopening, such as whether the school offers alternateday and voluntary remote-learning formats. Employers should be prepared to address employee inquiries regarding eligibility for FFCRA child care leave. Under the FFCRA employees must provide documentation to request child care leave, including the dates for which FFCRA leave is requested, the qualifying reason, the name of the child being cared for, the name of the child’s school, and a representation that no other suitable person will be caring for the child during the period that the employee has requested to take leave. Employers should ensure compliance with the documentation requirements of the FFCRA in order to seek tax credits for wages paid during the leave. TABLE OF CONTENTS

Mark Lann Phone:

302-765-6070 Email: chart.eo@rockwoodinsurance.com

www.chart-exchange.com

ANALYSIS - JENNIFER ROTHSTEIN Continued From Page 24

THE PROBLEM OF CYBER RISK AND HOW OUR STUDENTS WILL HELP SOLVE THEM There may be a moment of reflection about how the risks have developed so rapidly and so catastrophically and that might be the first time they think about how they can slow this trend down. Once the foundation is built, students start to focus on the range of attacks that exist, the types of actors who are launching these attacks and the seemingly endless permutations of strains of ransomware. They are made aware of legal and regulatory ramifications and the need for cyber risk transfer. The collaboration between the private sector and law enforcement serves to encourage group work and information-sharing. That’s when there is a shift in the perception of www.chart-exchange.com

all those digital conveniences they are accustomed to utilizing and a desire to make them safe – almost prior to enjoying them - becomes an urgent priority. In order to build sustainable solutions, students are researching inside and outside the classroom, applying for internships and finding ways to contribute and belong to this very diverse community of skill sets and opportunity. Students are curious about AI; the Cyber Attack Chain; the responsibilities that boards and CEOs have to their customers and employees; the threat of physical loss as a result of a cyber event.

WOULD YOU LIKE TO HAVE YOUR MESSAGE DELIVERED TO 100,000+ FOCUSED INSURANCE INDUSTRY EMAIL ADDRESSES EVERY MONTH?

The education is just beginning. The study of cyber security is broader than the STEM curriculum. It is also the study of risk, languages, communication, psychology, law, policy making and negotiation. Our workforce needs diversity in thought, culture and skills. Our students are showing interest, enthusiasm and success. As professionals, educators and leaders, we need to support our future generation through mentorship, accessible education and training to welcome them to the industry. As much as we have to teach them, they have a substantial amount to teach us as well and for that, we should all be grateful.

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I’m Kate Boyle Managing Editor. I handle CHART Exchange Advertising. Call me at 302 765-6056 and let’s have a conversation.

OCTOBER 2020

ANALYSIS - SIAA

5-STAR REVIEWS ARE GREAT, BUT CRITICAL FEEDBACK CAN MAKE YOU BETTER $8.1 billion

2 IN R $ $

$ $

total in-force premium

This article reposted with permission from SIAA, the largest alliance of independent insurance agency members in the United States.

ystery shopping is a practice utilized by many retailers, hotels, restaurants and banks to measure and receive feedback on the customer experience. “Secret shoppers” are hired to mirror consumer behavior and document their experiences. While not commonly deployed at that scale by small business owners, the concept validates the importance of fact-checking the actual customer experience against the perception or assumption of that experience.

Clients. Asking your clients, first step to taking the necessary especially those who best represent corrective actions. Developing the clients you want more of, for a mutual trust between you and honest feedback on how well you your staff to give and receive meet their needs, or how you could honest feedback will pay off in the be of better service to them may long run. total in-force premium growth provide the best clues available. Consider finding opportunities Mystery shopper (even your own to push beyond a “You guys did version). As the value of customer great” answer to get to those areas experience becomes more of improvement affecting client widely recognized as a critical strategic memb retention and cross-selling. success factor,independent mystery shopper services have responded with products and services that in nearly every 198specialize 3 vertical, including insurance. Can’t afford a customer experience consultant? Leaning on a mentor or business professional you trust to help assess simple phone interactions or the quoting process could be helpful in signed evaluating how your agency of independent agents in U.S. responds to different client exchanges.

$690 million 465

The difference between mediocrity and excellence usually comes from a desire to continuously raise standards of performance. Soliciting critical feedback can help 13% your agency shine a light on areas to focus.”

In the era of gathering many 5-star reviews to make your insurance agency stand out, are you also finding opportunities to gather critical feedback to evaluate actual performance and identify areas of improvement? Sources of honest, constructive feedback can include:

42 OCTOBER 2020

Staff. Is your agency a work environment that welcomes open dialogue and suggestions on how things could be done better? Communicating flaws in behaviors, processes and procedures is the TABLE OF CONTENTS

national strategic The difference between partner companies mediocrity and excellence usually comes from a desire to continuously raise standards of performance. Soliciting critical feedback can help your agency shine a light on areas to focus. The Total Solution

for the The Proven Distribution System for www.chart-exchange.com

NEWS - LLOYD’S OF LONDON Continued From Page 39

LLOYD’S APPROVES NEW SPECIALISED SYNDICATE TO INSURE TRANSPORTATION OF COVID-19 VACCINE TO EMERGING ECONOMIES McGill and Partners, we are delighted to have worked on this audacious venture that combines innovative insurance and data and technology driven solutions to help dramatically improve supply chains and ultimately save lives.” Sean McGovern, CEO, UK & Lloyd’s market at AXA XL said: ““The Covid-19 crisis has escalated the need to improve the already challenging global distribution of vaccines. By sharing data and through innovative risk mitigation, this facility will play a crucial role in ensuring that vaccines travel safely through the global supply chain to all corners of the world. This is another example of the insurance industry working in a public private partnership to address critical public health issues. AXA XL, in line with AXA Group’s commitment to contribute to the equitable distribution of vaccines, is proud to be a part this initiative.”

www.chart-exchange.com

* Syndicate 1796 has received inprinciple approval from Lloyd’s Council. The decision to grant permission for the syndicate to underwrite is contingent on completion of a number of relevant operational workstreams; this work will be concluded through August. ** Lloyd’s Supporting global recovery and resilience for customers and economies: the insurance response to COVID-19 Report proposes a number of ways the insurance industry could fast-track global economic and societal recovery from the far-reaching impacts of COVID-19. These include three open source frameworks (ReStart, Recover Re and Black Swan Re), that could help build future resilience through innovative partnerships and products together with a Centre of Excellence to better understand, model and provide insurance for systemic catastrophic events.

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WOULD YOU LIKE TO HAVE YOUR MESSAGE DELIVERED TO 100,000+ FOCUSED INSURANCE INDUSTRY EMAIL ADDRESSES EVERY MONTH?

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OCTOBER 2020

ANALYSIS - BLUEVOYANT

THE CMMC: ANOTHER LAYER OF OUR NATION’S DEFENSE AND A CHAIN OF COMPLIANCE By Jennifer Rothstein, BlueVoyant & Tim Smit, Lockton

The Cybersecurity Maturity Model Certification (CMMC) is a new cybersecurity requirement for DoD contractors and subcontractors. While the DoD and its extended network - by definition - already protect our nation, now these requirements will further protect these protectors.

The CMMC will encompass multiple maturity levels that ranges from “Basic Cybersecurity Hygiene” to “Advanced/ Progressive”. The intent is to incorporate CMMC into Defense Federal Acquisition Regulation Supplement (DFARS) and use it as a requirement for contract award. Contractors and subcontractors who handle Federal Contract Information

(FCI) and Controlled Unclassified Information (CUI) must be compliant. FCI is Government contract-related information that is not intended for public release. CUI is information created or possessed by or for the Government that a non-governmental agency is allowed to handle with the

See The CMMC Pg 47

About the Co-Author: Jennifer Rothstein is the Business Development Head,

Insurance & Legal, for BlueVoyant, a cybersecurity provider headquartered in New York City. She also co-founded and serves as the President of Women in Cyber Leadership Corp. As the cyber security industry has been rooted in STEM and the military, she recognized that it can be intimidating for women to start and thrive within the space, and has dedicated her efforts to providing everyone with the tools, opportunity, knowledge and confidence to succeed in cyber. Throughout her career at companies such as Kroll and AIG, she has lead the effort in combining cyber expertise with her deep knowledge in insurance. She is driven by a resolve to demystify two complex categories allowing access and understanding to both cybersecurity and insurance in our increasingly interdisciplinary and interconnected world.

About the Co-Author: Timothy Smit provides expertise in the areas of data

protection laws, privacy liability and cyber technology best practices for protecting information and their processes. Timothy has over 25 years of information protection experience in Insurance, Healthcare, Medical Devices, Government, Retail Merchandising, Higher Education, and Crisis Management industries. Timothy’s extensive knowledge comes from the information technology and information protection roles he has held over his career. That knowledge and first-hand experience enables him to translate those similar exposures into cyber coverages for the C-Suite to understand and comprehend. His approach and technical acumen is unlike any other cyber broker in the market place today, which differentiates Lockton on how we provide both proactive loss control services and placing the appropriate cyber coverage to the respective cyber exposures that our clients have.

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www.chart-exchange.com

www.bluevoyant.com

••

For insureds that need forensics, incident response, or proactive security services

••

BlueVoyant is a pure play cybersecurity firm

••

WE GET IT – we do it faster and better

Austin Berglas | Global Head of Professional Services austin.berglas@bluevoyant.com Vincent D’Agostino | Head of Cyber Forensics & Incident Response vincent.dagostino@bluevoyant.com Jennifer Rothstein | Business Development Head, Insurance & Legal jennifer.rothstein@bluevoyant.com Breached: incident@bluevoyant.com | Info: contact@bluevoyant.com www.chart-exchange.com

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OCTOBER 2020

ANALYSIS - SIAA

THE ROLE OF THE INDEPENDENT AGENT AS LEARNING PODS GAIN POPULARITY This article reposted with permission from SIAA, the largest alliance of independent insurance agency members in the United States.

s schools continue to grapple with reopening, the popularity of homeschool groups, or “pandemic pods” is on the rise. Parents are turning to home-based group education for many reasons. For some, public schools may be viewed as too high risk or too uncertain. Others are opting for a small group setting over their school districts’ online approach. Regardless of motivation or goals, a growing number of parents are proactively problem-solving the school dilemma $ $ themselves.

with the pod providing some in-person socialization for the children.

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Each unique pod arrangement presents its own set of legal and liability considerations. Whose home will host the learning experience, or will it rotate? What if someone falls ill or becomes injured? Will the children be transported to outings? What is the responsibility of the host and/or teacher to implement protocols? As parents are scrambling to pull these arrangements together, they may not be thinking about their potential liability if something goes wrong.

2018 IN REVIEW Mark Lann

Phone: Independent insurance 302-765-6070 agents have a role in educating $ $ $ $ $ $ $ $ $ $ $ $ $ community about$ this $ $ $ $ aspect$ $ $ $ $ $ $ $ their Email: of creative school arrangements. total in-force premium chart.eo@rockwoodinsurance.com Participate in online discussions Learning pods vary in size, approach happening on social media. Reconnect and arrangements. Parents may pool with clients who have school-aged resources to hire an outside teacher(s) children. Create blog posts for your or they may rotate or share that website or newsletter. Submit an article responsibility amongst themselves. to your local news outlets. These types Groups may create their own may help curriculumtotal andin-force schedule,premium or they may growth of important discussionsgrowth in total in-force premium prevent a difficult situation arising from opt to provide oversight while following a case of underinsurance or a gap in the public school’s virtual curriculum, coverage.

$8.1 billion

$690 million

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9.3%

TABLEmembers OF CONTENTS independent strategic signed

www.chart-exchange.com

ANALYSIS - BLUEVOYANT Continued From Page 44

THE CMCC: ANOTHER LAYER OF OUR NATION’S DEFENSE AND A CHAIN OF COMPLIANCE caveat that appropriate security controls are in place to protect that data. There are five different levels of cybersecurity maturity that contractors may achieve: Level 1 (Performed): Basic Cyber hygiene is in place with selected practices documented where required. Practices are ad hoc. Level 2 (Documented): Level 1 + a policy exists that includes all activities. Practices are documented. Level 3 (Managed): Level 2 + adherence is verified through examination or test, and a plan exists, is maintained and resourced that includes all activities (mission goals, project plan, resourcing, training needed, and involvement of relevant stakeholders). Processes are guided by policy, maintained and followed. Level 4 (Reviewed): Level 3 + activities are reviewed and measured for effectiveness (results of the review are shared with higher-level management) and for issue resolution. Practices are www.chart-exchange.com

periodically evaluated and revised. Level 5 (Optimizing): Level 4 + a standardized, documented approach across applicable organizational units. Practices are continuously improved and shared across the enterprise. Certification may only be granted by a third-party accredited assessor; contractors cannot self-assess. The practice of complying with cybersecurity requirements is not a new one to this group. Prior to January 1, 2020, the applicable guidelines were NIST SP 800-171. Now the CMMC Levels 1-3 incorporate the 110 security requirements specific in NIST. However, in order to be awarded a contract for the DOD, each supplier must be certified – the requisite level will be stated in the RFP. The Defense Industrial Base (DIB) is comprised of approximately 300k contractors who will be affected by the CMMC. Cybersecurity compliance, therefore, will be threading these contractors together – securing our supply chain in an unprecedented way. As our global economy continues TABLE OF CONTENTS

to expand, and in particular, as we rely more and more on our remote workforce and delivery infrastructure, organizations need to understand their partners’ cybersecurity posture. An organization is only as strong as its weakest link and in the context of the DoD, the weakest link can lead to catastrophic damages. The certification exercise and the critical preparation is not for CMMC alone. Along with data protection and information risk management, ultimately, most organizations conclude they have unacceptable levels of risk that either can’t be mitigated to a lesser risk or it is economically unfeasible to mitigate to an acceptable level. Ultimately, transferring those unacceptable risks to a best-in-class, broad cyber liability insurance program is highly recommended. Instead of merely recommending an ‘insurance policy” we advocate for a strategic partnership for organizations to partner with an expert-led cyber insurance brokerage firm. This strategic partnership provides not only the insurance required, it provides you with proactive, preventative privacy and cyber risk services along with preparedness in identifying, containing, handling, responding and recovering from a cyber event that impacts your organization and your supply chain. For more information, please contact Timothy Smit at timothy.smit@lockton. com or 206.999.5361 For more information, please contact Jennifer Rothstein @ jennifer.rothstein@ bluevoyant.com or 917.596.0866. OCTOBER 2020

LLOYDâ&#x20AC;&#x2122;S OF LONDON

48 OCTOBER 2020

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The CHART Exchange October 2020

Articles inside

Analysis Kroll: Return To Work Employee Training

Lloyd’s Launches “First -Of-Its-Kind Business Interruption Insurance