Insurance Business Canada 2.06 by Key Media

TRANSACTIONAL RISK ENERGY AND MARINE COMPLEX CONSTRUCTION NICHE UNDERWRITING MEDICAL DEVICES LONG TERM HEALTH DISTRIBUTION EXCESS SURPLUS LINES PHARMACEUTICALS ADMINISTRATION TRANSACTIONAL RISK ENERGY AND MARINE NICHE UNDERWRITING MEDICAL DEVICES LONG TERM HEALTH DISTRIBUTION EXCESS SURPLUS LINES PHARMACEUTICALS ADMINISTRATION TRANSACTIONAL RISK ENERGY AND MARINE COMPLEX CONSTRUCTION

Providing

Specialty

Solutions is no small task.

RSG UM specializes in providing risk management solutions tailored to complex, unique specialty risks. Each RSG UM facility focuses on the client’s business and works diligently to find the right solution. If one is not readily available, RSG UM has the capabilities and the relationships to develop innovative options and deliver risk transfer solutions to meet the needs of clients in unique market niches. And that is no small task in today’s world. For more information, contact RSG Underwriting Managers at (855) 201-2000 or visit www.ryansg.com.

RSG Underwriting Managers, LLC, is a Delaware series limited liability company and a subsidiary of Ryan Specialty Group, LLC, specializing in underwriting management and other services for insurance products distributed through agents and brokers. In California: RSG Insurance Services, LLC, Lic. #0E50879. Direct Group Limited (Registered No. 2461657) and Millennium Insurance Brokers Limited (Registered No. 3566382) are insurance distribution businesses and are authorized and regulated by the Financial Services Authority. © 2015 Ryan Specialty Group, LLC

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When it’s grim, you need Great

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Coverage is underwritten by Great American Insurance Company, Great American Insurance Company of New York and Great American Alliance Insurance Company, authorized insurers in all 50 states and DC; and Great American Lloyd’s Insurance Company, authorized in Texas only. ©2013 Great American Insurance Company. 301 E Fourth Street, Cincinnati, OH 45202

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ISSUE 2.06

Contents

January 2015

FEATURE

Sports & recreation Health clubs, sports teams and events represent a vast untapped market for the industry

COVER STORY

Hot 100 Our annual roundup of the 100 people who had the biggest impact on the insurance industry in 2014

PRODUCER PROFILE

William Feggins Against all odds, William Feggins has catapulted Divine Insurance Group to extraordinary success

BROKER ADVICE 8 | Head to head What does ORSA mean for the industry? 10 | News analysis How the Ebola outbreak could affect your business 14 | Technology update How can the insurance industry use big data to its advantage? 16 | Workers’ compensation update The latest on new benefits, emerging markets and more 18 | Industry icon: Hank Haldeman The new president of NAPSLO reflects on his own career and the industry’s future

REGULARS 6 | Statistics How does Ebola stack up against historic pandemics? 12 | Industry intelligence This month’s big movers and shakers 55 | In person A winding path took Stephen Ruschak to the top spot at The Guarantee 56 | Favorite things Phil Beakes, National E&S

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SMALL BUSINESS INSURANCE BUILT BETTER

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ACE Commercial Risk Services - competitive products, low minimum premiums, broad risk appetite, fast and efficient placement and consultative partnerships that allow our brokers to maximize their success. For more information, visit acegroup.com/smallbusinessinsurance or call 888.762.9223.

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Responsible & Innovative

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STATISTICS

INSURING THE UNINSURABLE: EFFECT ON THE LIFE INSURANCE INDUSTRY

Even in the unlikely event that the Ebola virus spreads in the US, the financial impact will likely be quite manageable. Roughly one-third of adults in the US have life insurance through their employment, and the amount is typically equal to one year’s income. Another one-third have individual life insurance, with the average death benefit in the $200,000 range. In a typical year, life insurers pay about 2 million death claims, so another 100,000 would be only 5% more than typical. Moreover, most life insurers are well capitalized, and even the largest life insurers have reinsurance to prevent a surge in death claims from imperiling their solvency, so that the net effect would likely be, at most, a reduction in the profit they would otherwise record.

EFFECT ON THE PROPERTY/CASUALTY INSURANCE INDUSTRIES The main effect on the Property/Casualty insurance industry would likely be on companies writing Workers Compensation insurance because health-care workers could be most directly exposed (as happened in Texas and in several African countries). In the United States, workers compensation coverage is nearly universal, but the likelihood of claims is low, assuming that employers and their workers take CDC-recommended precautions. As with life insurance coverage, reinsurance will help mitigate the financial effect of a surge in claims, which are likely to be very costly in the event of actual work-related infections. Other possible effects might be on various liability insurance lines. These include general liability, D&O liability and medical malpractice (med mal) liability. General liability and D&O claims might be filed asserting that the policyowner was negligent in failing to prevent transmission of the virus. For example, a claim might be filed alleging negligent disposal of contaminated waste, pursuing either general liability or med mal recovery. Source: iii.org

“Reinsurance will help mitigate the financial effect of a surge in claims, which are likely to be very costly in the event of actual work-related infections” Doctor Steven Weisbart, senior VP and chief economist, Insurance Information Institute

PANDEMICS THROUGH HISTORY

542 AD Plague of Justinian

1334 – 1347 Black Death

1665 Great Plague of London

1829 – 1851 2nd cholera pandemic

1863 – 1879 4th cholera pandemic

Approx. 10 – 20 million deaths

Approx 200 million deaths

Approx 100,000 deaths

Several million deaths worldwide

Approx. 8 million deaths

Only brought under control in 1666 by Great Fire of London

Spread from India to Europe, Japan and the US

Began in Ganges delta and was carried by Muslim pilgrims to Mecca

Mediterranean epidemic killed 25-50% of population of Roman Empire; Emperor Justinian survived

Devastated Europe, spread partly by Crusaders; 75% of population died

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EBOLA EBOLA OUTBREAK As of November 30, 2014

8 6 MALI

SENEGAL* 1

20 8 NIGERIA

1,327

66 49

3,145

CONGO*

2,164 7,635

GUINEA

SIERRA LEONE

1,583 Number of People Infected

7,312 LIBERIA

Dead Source: WHO; UN; The Economist

* Declared Ebola-free

CASE FATALITY RATE: 70%+ The virulence of a microbe is measured by its ‘case fatality rate,’ the percentage of cases that lead to death. Early estimates for the virus behind the current epidemic gave a fatality rate of 55% – below the 67% average for the previous 24 outbreaks. But the 55% figure is an underestimate of the true deadliness of the ongoing epidemic. This is because many reports (including those from

WHO) calculate case fatality rates using the number of cases and deaths on the same date, which doesn’t account for the time lag between when victims are diagnosed and the clinical outcome of their disease (recovery or death). Based on cases with known outcomes, the fatality rate for the 2014 epidemic is actually similar to the average for past outbreaks: 70%+.

Source: iii.org

1918 Spanish flu

1957 - 1958 Asian flu

1968 - 1969 Hong Kong flu

Approx 750,000 deaths

20 – 40 million deaths

100,000 deaths

700,000 deaths

76 deaths

Approx 284,500 deaths

Spread quickly thanks to advancements in train and boat travel

Killed more than WWI; the worst pandemic in history

Affected 10-35% of the world’s population, but mortality rate low

Category 2 disease on the Pandemic Severity Index

Originated in China as a result of direct contact with infected poultry

New strain of the H1N1 virus initially emerged in Mexico

1881– 1896

5th cholera pandemic

1889 – 1890 Russian flu

Approx 1 million deaths

Last serious European cholera outbreak as sanitation improved

1997 – 2007 H5N1 – Bird flu

2009 - 2011 Swine flu

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I/B January

HEAD TO HEAD

How is ORSA affecting the insurance industry? With all insurance companies required to conduct an Owned Risk and Solvency Assessment in 2015, IBA takes the industry’s pulse on the process

MONICA J LINDEEN President-elect

STEVE BROADIE

Vice president, financial policy

NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS (NAIC)

PROPERTY CASUALTY INSURERS ASSOCIATION OF AMERICA

“ORSA is an internal process that helps an insurer or insurance group assess its risk management and solvency positions under normal and severe stress scenarios. An ORSA requires insurers to analyze all reasonably foreseeable and relevant material risks (ie underwriting, credit, market, operational, liquidity risks, etc.) that could impact an insurer’s ability to meet its policyholder obligations. This helps insurers foster an effective level of ERM as each insurer identifies, assesses, monitors, prioritizes and reports on its material and relevant risk. ORSA also provides a beneficial group-level perspective on risk and capital to supplement to the existing legal entity view.”

”PCI sees two major issues. First, states must adopt the ORSA Model Law without amending its strong confidentiality protections. To be useful, the ORSA involves highly proprietary information, and unless it is protected from public disclosure the candor, the ORSA process requires simply won’t occur. Second, ORSA must not become a regulatory template or check-thebox exercise divorced from how the group really manages itself. If these conditions are met, the ORSA can become an extremely valuable tool for regulators to satisfy themselves the companies they regulate are well-managed, and perhaps even help the companies themselves to improve their risk management.”

SHAWN SEASONGOOD

Managing director, insurance industry practice PROTIVITI CONSULTING

“ORSA is currently creating a positive impact on the insurance industry, and continues to increase the attention placed on robust risk management practices as well as cultivating a strong risk culture. ORSA is challenging the industry to expand its focus on risk management beyond the traditional insurance risks and evaluate the impact of strategic decisions and capital implications. ORSA will help insurers foster a more riskaware culture and influence decision making. However, it is not without its own challenges, as insurers are finding that their workforce currently lacks some of the skill sets necessary to execute expected activities mandated by ORSA.”

WHY DO WE HAVE ORSA? In the wake of the financial crisis, it became clear that US state insurance regulators needed to be able to assess the holding company’s financial condition, as a whole, and its impact on an insurer within the holding company system. In November 2011, as part the NAIC Solvency Modernization Initiative, the NAIC voted to adopt a significant new addition to US insurance regulation: the US Own Risk and Solvency Assessment (ORSA).

Got an opinion that counts? Email iba@keymedia.com or join the discussion www.ibamag.com

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NEWS ANALYSIS

INSURANCE IN THE TIME OF EBOLA

The spread of the Ebola virus to North America has posed unique risks to commercial insurance – ones not covered under traditional policies EBOLA 2014: A TIMELINE March 25

The CDC issues its ﬁrst announcement on an Ebola outbreak in Guinea, totaling 86 suspected cases

April 16

Patient Zero, a two-year-old in Guinea, is identiﬁed in the New England Journal of Medicine

July 29

Patrick Sawyer, a government oﬃcial in the Liberian Ministry of Finance, is the ﬁrst American to die in the Ebola outbreak

August 8

The World Health Organization declares the Ebola epidemic the “worst outbreak” in its 40 years of tracking the disease

September 30

The ﬁrst diagnosed case of Ebola in the US is identiﬁed in Dallas, Texas

October 8

Thomas Eric Duncan dies of Ebola in Dallas

November 10

Dr. Martin Salia, a native of Sierra Leone, arrives at Nebraska Medical Center after testing positive for Ebola

In March of last year, 86 people living in West Africa were discovered to be infected with the Ebola virus, an infectious deadly disease characterized by high temperature and severe internal bleeding. Just five months later, the epidemic had metastasized into the largest outbreak ever documented, and major American insurers began to consider how a potential transfer overseas could affect the commercial insurance market. That hypothetical circumstance became a reality in late September, when the first case of Ebola in the US was confirmed. The patient, who died of the disease, infected two nurses at Texas Health Presbyterian Hospital. While strides have been made toward vaccination, insurance companies have begun to react. Ebola-specific products and exclusions on commercial property/ casualty policies have now become commonplace, and although the virus has yet to reach pandemic levels, continued Ebola cases have sparked serious take-up rates among these new products. The insurance industry is no stranger to health- and disease-related risk, and past crises have formed a basis for confronting

FAST FACTS ON THE EBOLA VIRUS Total cases

15,351 Laboratory-conﬁrmed cases

9,566 Total deaths

5,459 Source: CDC, as of Nov. 2014

the Ebola challenge. “The SARS crisis in the early 2000s provided a good model for Ebola,” says Dr. Steven Weisbart, an economist with the Insurance Information Institute. “There was the same kind of concern over a potential pandemic, and it helped the industry realize the need for specialized protocols, behaviors and policies to address these challenges.” Nevertheless, diseases like Ebola present a unique set of risks that affect certain

November 17

Salia dies at the Nebraska Medical Center

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business sectors and lines of insurance differently. Business interruption policies, for example, present an interesting challenge. The vast majority of business interruption policies provide coverage only for loss that can be tied to physical damage to the property. As such, business interruption stemming from a government quarantine of an Ebola-infected area or from reputation loss after an Ebola diagnosis on the property would not trigger payout. “Most insurance policies have a civil authority clause that pays out for shutdowns related to something like fire, but this was never intended for an Ebola-like situation,” says NAPCO CEO David Pagoumian. “There is some language out there that might cover it, but it’s rare.” Some insurers have moved to close this gap. One of the first products on the market came from Encino, Calif.-based NAS Insurance, in conjunction with Prospect Insurance Brokers and Ark Specialty Programs of Lloyd’s of London. The Ebola-specific business interruption policy responds to government-mandated closure of businesses due to the spread of the virus. Jeremy Barnett, senior vice president of marketing with NAS, says the company began discussing the idea of launching an Ebola-specific in late September – at the

WHAT’S THE LIKELIHOOD YOU’LL CATCH EBOLA? While preparation and risk management are responsible approaches for insurance professionals, the actual likelihood of an American contracting Ebola remains significantly low.

1 in 13.3 million

chance of contracting Ebola in America this year

1 in 9.6 million

chance of dying from a lightning strike this year

1 in 5.2 million

chance of dying from a bee sting this year

1 in 3.7 million

chance of being killed by a shark in a lifetime Source: NPR

“Reinforce to the population that some policies, like business interruption, are not intended to cover Ebola” David Pagoumian, NAPCO CEO height of Ebola fear in the US. “We had a regulatory business product for other kinds of communicable diseases, but nothing specific for this concern,” says Barnett. “We are able to pivot from that type of policy to address the general concern of businesses being required to shut down should there be any suspicion of an individual having been infected on the premises.” A similar product from Burns & Wilcox Brokerage – Protection Against Income Disruption [PAID] – is designed to respond to loss not related to physical damage, which includes events related to Ebola. Submissions for both products have been high, coming from a diverse array of businesses and from areas across the country. Other insurance lines, such as general liability, medical malpractice and directors & officers liability, could also be affected by an Ebola outbreak. D&O, for example, may experience claims “asserting the policyowner was negligent in failing to prevent transmission of the virus,” says Weisbart. The lasting influence of Ebola, however, will likely be on workers’ compensation carriers. Wesibart speculated that the impact on healthcare workers will cause the most significant changes to occur in the workers’ comp segment, though considering the insurance landscape of the most heavily hit countries, impact may be minimal. “It is unlikely that many workers in the main affected African countries have workers’ compensation coverages,” Weisbart says. In fact, the level of premiums per capita for all coverages – excluding life insurance – in these countries is “so low as to not be listed” in the latest Swiss Re report. Stateside, Weisbart sees a similar lack of

market disturbance. While workers’ compensation is near ubiquitous in the US, healthcare workers generally take proper precautions to avoid Ebola infection, meaning claims will be low. As for any lasting effects? “Reinsurance will help mitigate the financial effect of a surge in claims, which are likely to be very costly in the vent of actual work-related infections,” he concludes. Despite the array of new products, some insurers are taking the opposite approach. By fine-tuning their approach to policies like general liability, many US insurance companies hope to remove themselves altogether from the disease’s path. ACE Ltd., for example, announced in late October that its global casualty unit will use a new policy endorsement to exclude Ebola on a “case-by-case basis” while underwriting new policies or renewals for companies who allow employees to travel abroad. Producers in affected areas should be on the lookout for such exclusions when renewing policies for hospitals and other healthcare facilities, looking into endorsements and new Ebola-specific products as necessary. The chances of Ebola becoming a national threat will likely continue to remain low. However, Pagoumian advises insurance professionals to cover their bases by speaking frankly with policyholders. “Reinforce to the population that some policies, like business interruption, are not intended to cover Ebola,” he says. “Advise them on any exclusions that may be surfacing on general liability policies and make it clear that health policies are going to take the brunt of this.”

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NEWS ANALYSIS

INDUSTRY INTELLIGENCE Insurance Business America’s CORPORATE MOVES Acquirer

Target

Comments

EXL

Overland Solutions

EXL boosts underwriting support by acquiring Overland’s specialized premium audit, commercial and residential underwriting surveys and outsourced loss control services

R-T Specialty

Tennessee Underwriters

Ryan Specialty Group’s wholesale brokerage, R-T Specialty, acquires the Franklin-based assets of excess and surplus brokerage

Hub International

Laurus Strategies

Hub International acquires the assets of Laurus Strategies, an employee beneﬁts, human resource technology and global beneﬁts consulting business

Aon

Safe Brokers

Top reinsurance intermediary and capital advisor acquires leading Greek and Cypriot independent reinsurance broker, Safe Brokers

Fenkel Beneﬁts

The Moyer Group

One of the largest privately held beneﬁts companies acquires fellow New York-based beneﬁts provider

Marsh & McLennan NuWest

Top insurance provider snaps up Irvine, California-based middle market property/casualty broker

Hub International

Fotek

International insurance powerhouse acquires middlemarket employee beneﬁts provider

Arthur J Gallagher

The Forker Company

International insurance brokerage and risk management ﬁrm acquires Midwest contract surety solutions provider

Howden Insurance Brokers

Harmonia Corretora de Seguros

Hub International sells its Brazil-based commercial lines broker to London-based counterparts

Independent Insurance Agents of Texas

LevelFirst LLC

Texas based trade association expands its operations through the acquisition of Dallas-based MGA

Hub opts for domestic focus over international presence No less than three years after CEO Martin Hughes called the purchase of Sao Paulo-based brokerage Harmonia Corretora de Seguros “transformational for our company,” Hub International is offloading its only South American operation. “We have been pleased with the contribution that Harmonia has made to Hub,” Hughes said in a company statement. “However, we have made the strategic decision to focus on North American opportunities, which have been more robust than at any time in recent memory.” Corretora de Seguros has been acquired by fellow international insurer Howden, a unit of Hyperion Insurance Group.

PRODUCT NEWS > Aon has launched Ebola liability coverage for hospitals and other health care institutions. The coverage will be for situations where existing liability programs may not apply, providing up to $25 million in overage. It also will protect hospitals from cases related to their response to Ebola brought by employees, patients or even potential patients who have been refused admission. > JW Terrill has launched its own private health benefits exchange called TerrillChoice. The new exchange allows employers with 100 or more benefit-eligible workers to provide their employees with fixed contributions toward the cost of health insurance and other benefits, coupled with multiple benefit plan options and decision support tools designed to help individual employees select the coverage. > K&K Insurance, a subsidiary of Aon, recently launched a new accidental death and disability coverage for firefighters. The policies can be written for an entire state or on an individual firehouse basis. The offering is not available in AL, FL, IN, MA, ME, MN, MS, NY, OH, and VA. > Marsh is rolling out a proprietary analytics solution, Marsh Analytics Platform, which is now fully integrated with the company’s claims database, Global Loss Data Library. The expansive database holds information for more than 20 industries in several countries, amounting to approximately $300 billion in aggregate claims data. > Ryan Specialty Group has expanded the scope of its operations to the United Kingdom by creating a managing general agent to write directors and officers liability insurance in London. According to a press release, the unnamed MGA will write excess layers for Fortune 1000 companies and primary cover for both smaller public companies and privately held companies.

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regular wrap of all the important industry moves and plays

MOVERS & SHAKERS Name

Leaving

Joining

New position

Christian Ryan

Willis

Marsh

Managing director, US gaming practice leader

Frank Costa

Berkley Oﬀshore Underwriting Managers

American Institute of Marine Underwriters

New York-based chairman

Bryce Williams

Towers Watson

SeeChange Health

President and CEO

Mark Church

Marsh

Aon

Head of global general aviation

Catherine Besselman

Novae Group

Ironshore International

Divisional director, global head of agriculture

Courtney Leimkuhler

N/A

Marsh

Chief ﬁnancial oﬃcer

Christopher Sindle

Edgewood Partners Insurance Center

Hub International

Sales consultant

Michael Poulos

Oliver Wyman

Marsh

Head of client advisory services

Matthew McKenna

First Niagara

Prime Risk Partners

Senior VP

Axel Roesner

Zurich Insurance Group

Generali Global

Head of operations in Asia

Michael Caruso III

New York Life

Alper Services

Business developer

John Sawyer

Faraday Holdings

Barbican Insurance Group Underwriter to lead property binders

Neil Lipuma

Arch Insurance

Hiscox

Senior VP

Drew Johnston

Aon

IMA

Account executive

Scott Tramel

Euclid Energy & Longshore Underwriters

Blue River Underwriters

VP of US Longshoreman and Harbor Workers Act underwriting

Oliver Wyman’s Poulos gets senior Marsh post Marsh has announced the appointment of Michael Poulos, who spent the last 20 years with Oliver Wyman (an operating company of Marsh & McLennan) as head of the New York office. Poulos will serve as head of client advisory services, overseeing both Marsh Risk Consulting and Marsh Claims Advocacy. Meanwhile, Marsh promoted Michael Cormier to the position of head of Portfolio Development.

Bryce Williams to head SeeChange Health SeeChange Health, recipient of the Red Herring’s Top 100 Innovation award and used by more than 1 million members across some of America’s largest health plans, has appointed Bryce Williams as president and CEO. Williams comes from benefits consultant Towers Watson, where he had served as managing director of the company’s Exchange Solutions business segment since 2012. JANUARY 2015 | 13

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TECHNOLOGY UPDATE

Keeping producers at the front of

NEWS BRIEFS >> TWO-WAY RATING INTEGRATION TO MAKE AUTO REQUOTING EASIER Evolution Agency Management (eVo) and Semcat have announced two-way rating integration for personal auto. This allows the agent to originate data in either system and seamlessly transfer it to the other, and then back again, making for an easy, streamlined, bi-directional workflow. “We are very pleased to bring this very high quality capability with SEMCAT to all of our agents,” said Ken Butler of eVo. “Having this 2-way capability will enable them to enter new quotes, or to re-quote existing policies with only a couple of mouse clicks.” >> CONSUMERS MOVE ONLINE Swiss Re’s study, “Digital Distribution in Insurance: A Quiet Revolution,” highlights that while the number of policies sold online is still small, it represents a significant shift in consumer behavior. The internet is now considered a trusted, go-to source for insurance information, with price comparison tools and social media recommendations playing a large role in the consumer’s end decision. However, consumers still report valuing the face-toface interaction and expert advice provided by an insurance producer, particularly when considering tricky products like commercial and life insurance.

>> UNSTRUCTURED DATA An IBM study found that only 20% of the average insurance company’s data is structured, meaning that 80% of data is not stored in the friendly and manageable confines of a database. Despite the wealth

of data and content available today, decision-makers are often starved for true insight, the study said. >> NEW APPLIED SYSTEM TARGETS CONNECTIVITY Applied Systems, a leading provider of insurance software, has increased its automation and connectivity operations through the launch of Applied TAM 2014 R2. Applied TAM 2014 R2 provides greater consistency to workflows throughout the system, increased carrier and insurer connectivity, and enhanced usability, enabling agencies and brokerages to increase productivity and improve client service for continued business growth and profitability. More specifically, the improved technology aims to reduce time spent on administrative tasks, decrease errors and omission risk, ensure seamless training experiences and better allow businesses to respond to client needs.

>>MORE EXPERTS ON STAFF A new study from Strategy Meets Action (SMA), an insurance strategic advisory firm, has found the number of big data experts with advanced degrees on staff in insurance companies has risen from 21% to 51%. The study also found that 39% of property/casualty insurers with more than $1 billion in premiums decided to invest in big data initiatives, compared with only 14% of those with less than $1 billion in premiums. Property/casualty insurers ranked variety and veracity as the two biggest challenges in big data – above velocity, volume and value.

INSTITUTIONAL ROADMAP FOR DATA OPTIMIZATION To make the most of big data, start with a concrete plan for implementation

Big data is becoming one of the key words in the contemporary era, and the transition process for companies certainly isn’t being aided by looming regulatory shifts and the costs of funding the transformation. That said, there has been a push within the insurance industry toward mastering enterprise information management. For the companies who have not fully invested in the process, a new report from Deloitte could lend some helpful insights. Titled “Information Rich, Knowledge Poor: Overcoming Insurers’ Data Conundrum,” the report highlights the state of the insurance industry’s big data outlook, establishes a plan for providers to follow, and identifies what lies ahead for big data in insurance. “Insurers have always used tons of data to run their businesses, and the volume velocity and the variety of data is only going to continue to grow,” explains Michelle Canaan, manager of strategy, brand and innovation at Deloitte. “In spite of considerable efforts, for the most part, insurers haven’t mastered seamless, enterprise-wide data fluency, even for their traditional information.” Generally speaking, insurance companies need to stop just tweaking their systems and processes, and need to look at data through a new lens. They need to take it in small bits rather than one encompassing initiative and know that it is going to be a multi-year journey. Most important, companies need to

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technological advancement envision enabling information as a strategic asset, not a transitional burden. This process begins with what Canaan calls a ‘roadmap,’ which outlines the strategic trajectory of the company’s data transition. Following this, it is fundamental to get executive- or board-level buyin, because without their funding and support, the initiatives are doomed to stall or fail from the onset. In the preliminary stages of the strategy, it is advised to keep complexity low to win over any skeptics and ensure a good start to the initiative.

“In spite of considerable efforts, for the most part, insurers haven’t mastered the seamless, enterprise-wide data fluency, even for their traditional information” Equally vital is to establish a data champion to spearhead the initiative. This person and their team will act as the primary liaison between the business units, their functions and IT operations. They will also spearhead the data governance initiative for the enterprise wide deployment. “Finally, you need to decide which business unit is going to kick off the effort,” says Canaan. “Marketing, actuarial and finance are probably the best suited because they each have a vested interest.”

Q&A: MAKING SENSE OF BIG DATA Q: How would you define big data to insurance professionals? A: Whether it’s better inputs for the models that support the

KEN KRUPA Enterprise CTO MARKLOGIC

“Data technologies available today make all of an enterprise’s data more visible”

underwriting process or a clearer picture around the claims process, data technologies available today make all of an enterprise’s data more visible to decision-makers.

Q: What tools are used to analyze big data? A: NoSQL database technology and Hadoop are very much at the center of things. Some of the things being built around these tools may be “unattended” and batch-oriented (e.g. machine learning), while others may rely more on a real-time human-to-computer feedback loop. By and large, though, the tools end up turning data into information for people to interpret, whether the people are decision-makers looking at a trend graph or users on mobile devices receiving tailored business experiences.

Q: What are the benefits of properly managing big data? A: Proper management and governance around big data aren’t so much benefits as they are obligatory. There’s a lot of talk these days around moving toward a ‘data lake’ strategy where enterprises can just ‘pour’ all of their data into a massive digital storage pool, and magic just happens. Well, that’s simply not the case, particularly because the management needs from a business point of view haven’t gone away. This is particularly true in the insurance space, where PII (personally identifiable information) concerns are very real. Because we can do more with more data and more quickly, it is more critical to ensure the data is managed properly. That’s why enterprise capabilities and concerns (e.g. security, consistency, data quality) are at the forefront in discussions of today’s big data strategies.

Q: What are the key takeaways for insurance professionals? A: Today’s customer-centric requirements and opportunities in insurance are changing the status quo in fundamental ways. The industry is awash in data from so many sources. Most of the data remains unleveraged or under-leveraged. Relational database management systems (RDBMS) technologies are not sufficient to meet today’s data needs.

Q: Anything else we should know about big data in insurance? A: For insurance companies that have felt they were behind the technology curve, today’s new technologies are offering a leapfrog opportunity. For instance, the self-describing data formats (XML and JSON) associated with today’s NoSQL databases happen to map well to the Cobol copybooks of yesteryear. Those older file-based formats had things like deep hierarchies and polymorphic models that happen to be easy to map as XML documents or JSON objects today. JANUARY 2015 | 15

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WORKERS’ COMP UPDATE

Producer-focused news and analysis

AGENTS SHOULD BE AWARE OF WORKERS’ COMP BENEFIT THAT GETS EMPLOYEES BACK TO WORK FASTER

NEWS BRIEFS

>> CALIFORNIA MOST EXPENSIVE FOR WORKERS’ COMP California is the most expensive state for workers’ compensation costs, according to The Workers’ Compensation Premium Rate Ranking Summary report from the Oregon Department of Consumer and Business Services. California businesses spend $3.48 for every $100 of payroll issued, compared to the average of $1.85 for all 50 states – that’s 188% of the median cost. Also in the top 10 most expensive states were Connecticut, New Jersey, New York, Alaska, Oklahoma, Illinois, Vermont, Delaware and Louisiana.

>> JAMES RIVER LISTS James River, a nationwide leader in workers’ compensation insurance for homebuilders and health-care workers in North Carolina, South Carolina, Virginia and Tennessee, will raise as much as $288 million through an initial public offering. James River had $386 million in revenue last year, up from $237 million in 2006. The company was unable to comment on any potential effects on producers selling its products until the listing is completed. >> AMERISAFE DOUBLES UNDERWRITING PROFITS One of the largest specialty providers of high-hazard workers’ compensation insurance, Amerisafe, recently announced impressive third-quarter results, most

notably an increase in underwriting profits of 114% for the three months to end September 2014 over the same period last year, and a 90% increase for the equivalent nine-month period. “We continue to experience a workers’ compensation market with attractive pricing and modest exposure growth. Looking ahead, as external forces continue to affect the market, we expect prices to plateau while payrolls gradually improve within our niche industries,” explained chairman and CEO Allen Bradley. The company has also recently elected Michael Brown to its board of directors.

>> ACE BUILDS CONSTRUCTION OFFERING ACE has expanded its online platform ACE Worldview, which enables construction clients to access all subcontractors’ policies, endorsements and audits through a single web portal. “We listened to our brokers and clients and recognized the need to expand access of the ACE Worldview platform to include our construction customers. By utilizing this web-based platform, they can save time and increase their overall efficiency in policy management, thus enabling an increased focus on critical jobsite-related issues, such as safety and loss prevention,” said Geoffrey Hall, senior VP of ACE Construction.

Securing favorable workers’ compensation rates depends on a variety of factors, not least of which is the average disability duration of injured workers, and a new study conducted by Risk Navigation Group reveals one easy way to improve disability duration – utilizing nurse care management. Getting employees back to work more quickly has been a consistent struggle for both business owners and their risk managers and insurance agents, but the study reveals that injured workers assigned a nurse care manager recover much more quickly: The average disability period is 44.3 days less than for those not assigned a nurse care manager. The first set of claims studied were from a transportation and energy workers’ compensation program underwritten by a national insurer, only 38% of which were assigned a nurse care manager. The second set of claims came from an Energi program, 100% of which were assigned a nurse care manager. The resulting shorter disability duration significantly lowered the overall cost of the claims. The message the study potentially sends to producers advising on workers’ compensation programs? Be more selective when evaluating carriers. “This study really exemplifies the difference in carriers,” says Brian McCarthy, CEO of Energi. “I think agents and brokers ought to be looking at programs that offer nurse care management, and explain to clients that it’s worth a little bit more money to get that managing of medical care in the first eight weeks.”

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on the US workers’ comp markets

Q&A: ENERGY, OIL AND GAS WORKERS’ COMP

BOB WOODS SVP of claims ENERGI

TODD DESTEFANO President of risk management YORK RISK SERVICES

IBA: Can you elaborate on some of the specific considerations for energy, oil and gas workers’ compensation compared to traditional workers’ compensation? Bob Woods: A lot of new people are entering the energy business. The thirst for employees is very high, and particularly trucking and transportation drivers are in very short supply. What we’re seeing and counseling our insurance customers on is that they need to be careful in their hiring practices to make sure they get the best drivers. It’s important to ask the right questions, such as, “Have you ever driven the particular type of vehicle you’ll be driving?” Too often in the hiring process, truck drivers assume they have the training and experience to drive big oil and gas fleets, but driving a truck with 10,000 gallons of gasoline on the back takes a whole new set of skills to stay safe.

IBA: What are some of the primary risks for workers’ compensation in the field of energy, oil and gas? Doug Markham: When you join a new or

DOUG MARKHAM President WELLCOMP MANAGED CARE SERVICES

inexperienced labor force, injuries can be more frequent and start to cross into areas of severity. When considering the treatment of an injured worker, it is important to improve their condition to the level of maximum medical improvement [MMI], which is defined as a state when the patient is fully recovered from the injury or when the condition has stabilized to the point that no major medical or emotional change can be expected. Once the worker has reached MMI, you can better understand what tasks or functions they can perform.

Todd Destefano: More and more, we are seeing the industry use alternative mechanisms to traditional workers’ compensation, meaning a form of risk-sharing, whether that is a self-insured group, a captive arrangement or even an opt-out plan to help them manage claims costs and their total cost of risk.

IBA: Can you explain punitive damage coverages and how that can be a significant exposure for policyholders? BW: Punitive damages are as their name implies – meant to punish. Carriers in the past may have inadvertently felt as though these damages were not covered, but in more states than not, these punitive damages can be considered part of the underlying insurance policy and even into excess layers. Therefore, it is very important that carriers are aware of the punitive damage issue in their particular jurisdiction and that they take all steps to ensure their insured do not get put in these types of situations.

IBA: Transportation of materials has seen as many, if not more, claims than the actual drilling or extraction. What coverages do you assess when insuring transportation? BW: One of the services Energi offers is a team of over 40 remediation specialists around the country. Our loss-prevention staff members are licensed as adjustors as well as loss prevention professionals, and we use them as boots on the ground on these rollover claims involving hazardous materials.

IBA: According to the ND Petroleum Council, since 2007, oil and gas growth has tripled, workers’ compensation claims have quadrupled, and oil and gas truckers’ claims have grown sixfold. How do you keep up with such expansive growth and ensure all parties have proper coverage? BW: The growth of industry claims creates issues. It creates obvious risk for the labor force, which is where York’s services come into play. York implements a scientific, data-driven approach to risk management. At Energi, we share all our premium data with York. York is then able to give us a projection of our staffing needs for our offices. From a claim perspective, we’ve been able to stay way ahead of the curve. JANUARY 2015 | 17

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INDUSTRY ICON / HANK HALDEMAN

INDUSTRY ICON

LOOKING FORWARD New NAPSLO president Hank Haldeman talks industry issues, career trajectory and giving back

NAPSLO – brief history 1975 formalized; incorporation papers filed in New York 1979 three membership types established - regular, company and supporting; membership at 360 firms 1982 company members were made full-fledged voting members; membership passed 600 1988 offices moved to Kansas City, Mo., to be more accessible to the membership 1996 Associate in Surplus Lines Insurance (ASLI) designation established 2009 Executive Leadership School established as capstone course for top-tier industry executives 2012 transitions to new executive director, Brady Kelley, after 30 years of leadership by Dick Bouhan 2013 annual convention boasts a record 3,844 attendees in San Diego 2014 celebrates its 40th birthday at the September 2014 annual convention in Atlanta

After 17 years with The Sullivan Group, Hank Haldeman has decided to further his involvement in the industry by taking the reins as president of the National Association of Professional Surplus Lines Offices [NAPSLO]. “My top priorities, first and foremost, are continuation and expansion of the wholesale value campaign – messaging to retail commercial agents and insurance buyers of the value that wholesalers and the surplus lines channel bring to insurance transactions,” Haldeman says. “Beyond that, the focus on recruiting new talent into the wholesale and surplus lines ranks is a high priority as well. We’ve done a great job of setting a foundation of recruitment from colleges, and we’re in the process of expanding that fairly significantly through outreach to other insurance programs and into other recruiting centers in various universities.” What Haldeman’s new role won’t involve is a wholesale reversal of the organization’s focus. Instead, he reiterated, NAPSLO will continue to follow the four core areas of activity and value proposition to members: improving the NAPSLO conference, adding classes to NAPSLO’s education efforts, continuing state-based advocacy and expanding the reach of the wholesale value campaign.

AN UNEXPECTED JOURNEY Surprisingly, Haldeman started his career in the music industry. “I was in the business end of the music industry, which I did for a number of years before getting fairly disillusioned with the nature of that business and the way it was conducted – particularly in the 1970s,” he explains. Haldeman decided to branch off and start his

own music production and publishing company, screening new talent and helping to select music. By 1973, he had reached the point of no return and decided a career change was in the offing. Haldeman reached out to a friend who had a fairly senior position with a wholesale insurance brokerage, and the rest is history. “What really attracted me was that they did most of their business over the phone and with a handshake,” Haldeman says. “You had to be as good as your word.”

DUAL COMMITMENTS Being both the executive vice president of The Sullivan Group and president of NAPSLO means time is at a premium for Haldeman, but he doesn’t believe either role takes away from the other – primarily because of the professionalism shown by employees of both organizations. Those employees are what make his time in insurance industry truly rewarding, Haldeman says. Beyond that, he also enjoys the opportunity to work with competitors in the NAPSLO environment. Despite their traditional roles as adversaries, he says there’s a particular satisfaction from everyone coming together to improve the industry as a whole. And the common ground between his two roles isn’t as limited as one might think. “There are significant areas of overlap,” Haldeman says. “My role within The Sullivan Group is first as executive vice president, as well as partner with Jerry, running the operations. That within itself is more of a strategic focus, and the issues we’re looking at certainly overlap with the strategies and issues NAPSLO is looking at. Whether it is education, development of personnel, recruit-

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“We’ve got to get out and do an even better job of recruiting new talent into this segment of the insurance business. The failure to do that is our greatest threat”

NAPSLO – membership

• 400 brokerage member firms • 100 company member firms • 200 associate member firms • members operate tover 1,500 offices • members represent 15,000-20,000 insurance professionals *figures approximate

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INDUSTRY ICON / HANK HALDEMAN

parents first tossed him into the sea as a child. Some of his favorite spots are well-known destinations such as Newport Beach, along with some lesser-known destinations that are only shared within the bodysurfing community. In regard to his family, Haldeman has relished the opportunity to have his wife, Heather, travel with him on business. “Interacting with the people in the business that we’ve gotten to know and become friends with has been a very important part to enjoying my profession,” said Haldeman.

GIVING BACK

“First and foremost, [my priority is] continuation and expansion of the wholesale value campaign – messaging to retail commercial agents and insurance buyers of the value that wholesalers and the surplus lines channel bring to insurance transactions” ment or the communication of our value as a firm, NAPSLO mirrors a lot of that on a national or industry-wide basis.”

SURF’S UP Outside of the insurance industry, Haldeman likes to connect with his Southern California roots and catch some waves in his spare time. “Two things are critical for my sanity,” he explains. “The first is my family, and the other is surfing. If I go for several weeks without being able to get in the water, my wife will suggest that it’s time for me to do so.” He’s not talking about traditional surfing, either. Haldeman is one of the few bodysurfers left and has been practicing the art ever since his

Haldeman was quick to mention Jerry Sullivan, chairman of The Sullivan Group, as someone who has had a remarkable influence on his career. Not only has Sullivan helped him grow within The Sullivan Group company environment, but he also has introduced him to various industry groups and emphasized the importance of giving back. “I’ve been heavily involved with the Insurance Industry Charitable Foundation since the days when it was based in San Francisco,” Haldeman says. “It eventually expanded into Southern California and is now a vibrant, growing national organization. The role that it plays in bringing together the industry in its philanthropic focus is something I’ve spent a lot of time on, and I’m very proud to see how that organization has grown and succeeded.” Haldeman is also heavily involved in two regional organizations – the California Surplus Lines Association and the California Insurance Wholesalers Association. Both organizations play a vital role in representing the wholesale and surplus lines communities not only in California, but nationally as well. In terms of direct challenges on both a national and regional level, Haldeman says, “Our two greatest challenges are also our greatest opportunities. First is the challenge of effectively communicating to retail commercial agents the value of a wholesale broker in a transaction. Second, we’ve got to get out and do an even better job of recruiting new talent into this segment of the insurance business. The failure to do that is our greatest threat.”

Ins co Ind No

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OVERARCHING

SOLUTIONS

SUPPORT

S TA B I L I T Y

KNOWLEDGE

AGILITY

RESPONSIVENESS

PROTECTION

ACCIDENT & HEALTH ALTERNATIVE MARKETS E&S CASUALTY CONSTRUCTION CONTRACT BINDING OPERATIONS DESIGN & ENVIRONMENTAL EXECUTIVE ASSURANCE EXCESS WORKERS’ COMPENSATION HEALTHCARE LENDER PRODUCTS NATIONAL ACCOUNTS CASUALTY PROFESSIONAL LIABILITY PROGRAMS PROPERTY SURETY TRAVEL

THE STRENGTH OF ARCH

www.archinsurance.com

A.M. Best: “A+” Standard & Poor’s: “A+”

Insurance coverage is underwritten by one or more member companies of Arch Insurance Group in North America, which consists of (1) Arch Insurance Company (a Missouri corporation, NAIC # 11150) with admitted assets of $3.11 billion, total liabilities of $2.35 billion and surplus to policyholders of $757.06 million, (2) Arch Specialty Insurance Company (a Nebraska corporation, NAIC #21199) with admitted assets of $527.36 million, total liabilities of $240.68 million and surplus to policyholders of $286.68 million, (3) Arch Excess & Surplus Insurance Company (a Nebraska corporation, NAIC # 10946) with admitted assets of $63.30 million, total liabilities of $3.77 million and surplus to policyholders of $59.53 million and (4) Arch Indemnity Insurance Company (a Nebraska corporation, NAIC# 30830) with admitted assets of $23.27 million, total liabilities of $(0.092) million and surplus to policyholders of $23.36 million. All figures are as shown in each entity’s respective Quarterly Statement for the quarter ended June 30, 2014. Executive offices are located at One Liberty Plaza, New York, NY 10006. Not all insurance coverages or products are available in all jurisdictions. Coverage is subject to actual policy language. This information is intended for use by licensed insurance producers. © Arch Insurance Group 2014

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SPECIAL REPORT / HOT 100

2015

Denis Brady President, Burns & Wilcox Brokerage When Denis Brady took the reins at Burns & Wilcox Brokerage in 2013, he’d already built a reputation as someone who could build an organization from the ground up, having previously turned American E & S Insurance Brokers into one of the country’s top five wholesale brokers. Soon after he joined Burns & Wilcox parent company Kaufman Financial Group, Brady instituted a bold plan to push the company’s wholesale brokerage business to new heights. Aggressively pursuing top talent, Brady attracted many of the country’s best brokers. Since January, he’s opened six Burns & Wilcox Brokerage offices and hired more than 25 property and casualty brokerage experts. He’s also been instrumental in the development of two Burns & Wilcox Brokerage proprietary products, cancellation of booking insurance (COBI) and protection against income disruption (PAID).

Michael Palotay SVP of underwriting, NAS Insurance Services Since he joined NAS in 2009, Michael Palotay has spearheaded the development of the company’s tech and cyber liability businesses, which have seen 500% growth in GWP under his guidance. Possessing a deep understanding of cyber risk coupled with creativity in designing cyber liability and tech E&O policies, Palotay has moved the entire industry forward. He’s a highly regarded cyber liability underwriter among Lloyd’s underwriters in London, as well as an acknowledged thought leader in the US brokerage community. A highly sought industry expert, Palotay has participated in industry conference panels around the country.

Dana Ramundt President, The Dana Company A key figure in bringing the Emmett J. Vaughan Institute of Risk Management and Insurance to the University of Iowa, Dana Ramundt created a foundation to provide scholarships and mentoring opportunities to the next generation of insurance pros. Since 2007, he’s raised several hundred thousand dollars for the foundation, most of it coming from the insurance industry. Ramundt serves on the Vaughan Institute’s advisory board and is a past president of the Independent Insurance Agents of Iowa. He’s active in state and national affairs and continues to serve on numerous company advisory councils.

Pamela Ritz President, Specialty Risk Management, Inc. An expert in employment practices liability, food-borne illness, product recalls and more, Pamela Ritz is a force to be reckoned with in the risk management world. A sought-after speaker, Ritz frequently teaches and speaks at seminars. She’s developed several management programs for controlling professional liability exposures, and has been recognized as one of the top 50 women in insurance worldwide.

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SPECIAL REPORT / HOT 100

Tara Philbin Agency principal, Philbin Insurance Group

Jim Sattler Principal, CBIZ-Sattler Insurance Agency

The insurance industry is changing, and Tara Philbin believes in embracing that change rather than fleeing from it. Regularly incorporating new technologies to improve efficiency, Philbin believes in using hard data to identify obstacles and create solutions. She’s also a big proponent of using automation, innovation and social media to reach out to millennials, developing her processes around their expectations.

An expert in risk management, Jim Sattler has been serving the outdoor recreation industry since 1979. Sattler provides counsel for specialized businesses, and has been instrumental in developing specialty insurance programs for outdoor sporting outfitters.

Matt Foran CEO, EvoSure Prior to co-founding EvoSure, Matt Foran worked as the director of strategy for Zurich Specialty Products, a $2.5 billion business unit of Zurich Insurance Group. At Zurich, Foran helped set the company’s overall strategic direction and spearheaded the development and execution of financial and operational plans and strategic initiatives. Prior to that, Foran was an assistant vice president at Marsh USA. In that role, he was a key player in the initial formation of the Marsh & McLennan Agency, the Marsh Select Model and the restructuring of Marsh USA. In 2011, Foran was named a Global Rising Star by Reactions magazine.

Donald B. Thompson President, Epic Insurance Solutions Under Donald B. Thompson’s leadership, Epic Insurance has had an epic first year. Founded in April 2013, the company already has almost 70 employees and $6 million in commission revenue. The company’s rapid expansion is due to equal parts acquisition and organic growth. Thompson is already planning to hit $10 million in commissioned revenue next year.

Gino A. Orrino President, Orrino Capital Service A vocal lobbyist for insurance agents and brokers, Gino Orrino has testified before the Senate on hydrofracking and served on panels for the PIA Leadership Forum. He is the immediate past president of the Young Insurance Professionals of New York and continues to be an active member of PIAPAC, frequently meeting with senators and New York State Assembly members to represent the industry’s interests. Orrino has just been appointed PIA’s national chair for the Careers in Insurance Committee.

Tiffany Nolan Sales representative, Liberty Mutual Tiffany Nolan has been a captive insurance agent with Liberty Mutual Personal Insurance since 2010. In four years, with no prior insurance experience, she’s amassed a $1.2 million captive book of business. This year, Nolan was one of eight field agents contracted to work on the Liberty Management Systems initiatives team, which designed business solutions for the company’s captive sales agents across the nation. Nolan has managed to bridge the gap between captive agents and brokers by partnering with independent agents in her area; in that way, she maintains the brand identification and customer service expected by her clients, while giving them options in case they have insurance needs that don’t align with her target market.

Bernd G. Heinze, Esq., Executive director, AAMGA Bernie Heinze is a staunch advocate for AAMGA’s mission. “Whether educating legislators on critical wholesale insurance industry matters, updating the Lloyd’s market on critical North American insurance issues and developments, or ensuring AAMGA members have the information, resources and continuing education and networking opportunities needed to be successful in their businesses, Bernie is tireless in his efforts,” says Rod Hughes, VP of Kimball Communications. Heinze is a leading voice in the industry, making his presence known in legislative matters like TRIA and NARAB and helping to recruit, train and retain the next generation of insurance professionals.

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2015

Prospering in todayâ&#x20AC;&#x2122;s business environment is as it has always been: your clients must trust you. If you deliver on what you promised, trust between the parties is built.â&#x20AC;&#x2039;

Joseph L. Boren EVP of insurance services, Ironshore Insurance As chairman of the environmental product line at Ironshore Holdings and executive vice president of Ironshore Insurance Services, Joseph Boren brings to bear his expertise in every segment of the environmental market. Prior to his work at Ironshore, Boren was the chairman and CEO of AIG Environmental, which he built into a leading US provider of environmental insurance products and services.

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SPECIAL REPORT / HOT 100

Merwyn Larsen Co-founder Erickson-Larsen, Inc. As co-founder of Erickson-Larsen, Inc., Merwyn Larsen remains an industry force even in semi-retirement. Staying active in the company, Larsen continues to create job opportunities within the organization. Known and respected throughout the industry, Larsen also remains extremely active in NAPSLO, AAMGA, the Big I, PIA and other insurance industry groups.

Robert Cohen Chairman and CEO, The IMA Financial Group IMA Financial Group has grown by leaps and bounds – from a $34 million company in 2001 to $114 million in revenue last year – and Robert Cohen is leading the company into the future. Two years ago, Cohen implemented Vision 2020, an eight-year project to advance IMA to a new level on the national and global playing fields. Cohen’s vision is to more than double the company’s size over the next few years. He sees his employees as critical to the success of the company. That means treating employees to a café-like lunch area and a Starbucks in the Denver office, a free employee fitness center and free EcoPasses to encourage employees to use public transportation. Cohen is also active in local charity, sitting on the boards of more than 10 area nonprofits and multiple civic commissions aimed at promoting economic development.

Tim McAuliffe President of specialty casualty Ironshore Insurance As president of specialty casualty for Ironshore, Tim McAuliffe brought to bear his years of experience at AIG’s Risk Specialist Companies, the largest surplus lines broker of specialty insurance products in the country. At Ironshore, McAuliffe has spearheaded the growth of the company’s market share in the excess and surplus space, with a 36% growth in premiums since the first quarter of 2013.

Matt Lynch Area president Risk Placement Services The area president for Risk Placement Services’ Minnesota office, Matt Lynch is a busy man. In addition to his professional duties at RPS, Lynch serves as the vice president for the Under Forty Organization, recruits and mentors new talent, and is active in his local community, helping with fundraisers for worthy causes and industry events. This year, Lynch was named an RPS branch manager of the year.

Dimitri Nikouline Co-founder and chief technology officer Appulate, Inc. In 2005, a tough workers’ comp market created a lot of pain for California insurance agents. Each carrier required agents placing business to fill out its own specific questionnaire. Nikouline co-founded Appulate and designed a technology, Supplemental Pro, to automate that process. Supplemental Pro propelled the fledgling company into thousands of retail agencies. Nikouline’s savvy has built Appulate into one of the fastest-growing insurance tech companies of the decade.

Michael Gramm VP of excess casualty and surplus, XL Group As vice president of excess casualty and surplus for XL Group, Michael Gramm manages all of the company’s excess casualty business. When he joined the company in 2012, Gramm created and led a completely new excess auto book. He brought in more than $2 million in gross written premium in the first two months of business.

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SPECIAL REPORT / HOT 100

Mark Lee Managing director, Higginbotham At just 30 years old, Mark Lee is the youngest of 47 managing directors hand-picked to lead Higginbotham, one of the country’s largest independent insurance firms by revenue. One of the top producers at the company, Lee is already a mentor to other producers, as well as the company’s go-to expert for energy-related business. Lee has served as the chair of the Independent Insurance Agents of Texas’ Young Agents Advisory Council for the past six years, and was the recipient of that organization’s André P. Juneau Young Agent of the Year Award in 2013.

Troy Fornof Director of branch development & operations, USG Insurance/USG Holding Group As director of branch development and operations for USG Insurance and USG Holding Group, Troy Fornof oversees operations in offices across the country. In 2009, Fornoff launched USG’s Small Business Unit, which incorporates the expertise of seasoned underwriters to streamline the binding authority process. The following year, he launched the company’s Service Center, a back-office support system designed to handle technical and administrative workflow for all USG offices. This year, he’s spearheaded an initiative to create career development paths for USG employees, presenting staff with detailed maps of their experience and enumerating the tools and experience they need to move up through the ranks in the company. He also spearheaded this year’s launch of BFS Inspection Services, a full-service inspection company that provides commercial P&C inspections for insurance organizations.

Cason Burdett Vice president and division manager, U.S. Risk Underwriters Cason Burdett’s role in the energy division of U.S. Risk has caused the program to flourish. He put forth an aggressive business development plan that resulted in a year-over-year growth rate of 50% in premium income from 2012 to 2013. Burdett’s leadership resulted in improved products and services offered only to energy insureds.

Nag Rao, Founder and CEO, EZLynx As the founder of EZLynx, Nag Rao has pioneered the development of industry-leading software for the insurance space. EZLynx was an innovator on several products the industry had never seen, including real-time rating and e-signature integration. “We want to change the industry,” Rao says. “We want to make our agents successful.”

Alain A. Bellet Founder and president, Capstone Underwriters, LLC

Noelle Codispoti Executive director, Gamma Iota Sigma

In 1983, after years of working as Societe Commerciale de Reassurance’s representative in America, French native Alain Bellet left to begin a new career as a reinsurance consultant. In 1991, Bellet founded Capstone Underwriters, a property and casualty MGA/brokerage. The company now employs 26 people and is licensed in 20 states. Bellet founded the local chapter of the French American Chamber of Commerce and serves as a board member for the Dallas International School. He was recently awarded the Legion of Honor, the French government’s highest award, for his work to promote French-American business relations.

Noelle Codispoti played a key role in resurrecting Gamma Iota Sigma, risk management and insurance’s collegiate fraternity. So far she’s grown the organization to more than 2,000 members at 57 colleges in North America – and that number is still growing. Codispoti helps connect insurance companies with talented young people with a passion for the industry – a service that could help mitigate the coming talent crisis as Baby Boomers retire.

Lindsey Waters President, First National Brokerage Company Lindsey Waters started working at First National Brokerage Company when she was just 17 years old. Now a veteran in the insurance game, Waters worked her way up to become president of the company. “I have watched her grow from a kid into one of the go-to people in Virginia when you have a question about health insurance or the Affordable Care Act,” says colleague Allan Jones. “[She’s a] class act on all levels.”

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2015 2014

Curtis Barton Co-founder and president, Venture Pacific Insurance Services In 1997, Curtis Barton co-founded Venture Pacific Insurance Services, and the company quickly grew to become one of the country’s top independent brokerages. Today, Barton serves as president of Venture Pacific and CEO of its subsidiary, Icon Risk Management. As president, Barton has led the way in building Venture Pacific into a full-service brokerage which provides commercial and personal lines, benefits, surety, risk management and financial services. The company has maintained double-digit growth each year under Barton’s guidance, and is projecting a 30% year-over-year increase in revenue for 2014.

Joni Waldych President and owner, Innovative Benefit Solutions With more than 25 years of experience, Joni Waldych is an industry expert. That expertise, along with her dedication to researching health care changes, has helped Innovative Benefit Solutions attain a 98.9% retention rate. Waldych is also active in her community, serving as a board member for the Ocean City Chamber of Commerce. She previously served as the chair of the Salisbury Area Chamber of Commerce Health Care Task Force.

Bill Pritchard President & CEO, Beacon Hill Associates Bill Pritchard, founder of Beacon Hill Associates, is a third-generation insurance professional. Over more than two decades, Pritchard has built the company into a leading provider of environmental liability insurance nationwide. Pritchard has published articles on environmental insurance and has consulted with many insurance companies on policy language creation and modification.

Daniel Eckert SVP of services, Walmart This year, Daniel Eckert helmed a deal with AutoInsurance.com to offer motor vehicle insurance through Walmart’s website. The move angered a lot of brokers, and may present a significant switching risk; according to one report, more than two-thirds of policyholders would consider purchasing insurance products from companies like Amazon or Google.

David James CEO, The Right Choice Insurance Agency David James was just 18 when he started The Right Choice Insurance Agency. In just over five years, he’s grown that agency to 30 employees and $10 million in premium. Right Choice was the nation’s top agency for Encompass Insurance in 2012; James has won Safeco Insurance’s Presidential Award and Hastings Mutual’s Choice Award for three years running. This year, he was named one of Detroit’s top entrepreneurs.

Debra C. Newman Founder and president, Newman Long Term Care

Inga Beale CEO, Lloyd’s of London When Inga Beale succeeded Richard Ward this year, she became the first female CEO in the 325-year history of Lloyd’s of London. Prior to being appointed CEO at Lloyd’s, Beale was group CEO at Canopius Group. She’s also served as group CEO at Convernium in Switzerland and as a member of the Group Management Board for Zurich Insurance Group.

Debra Newman has devoted almost a quarter-century solely to long-term care planning. Starting with only herself and one employee, Newman built Newman Long Term Care into one of the nation’s foremost LT-CI-only companies. A highly sought-after expert in the field, Newman has lent her perspective to publications like USA Today, the Wall Street Journal and Money magazine. She’s also appeared at numerous state NAIFA conferences as a speaker, as well as speaking to industry and consumer groups and government panels in more than 40 states.

Cameron Suhr VP of business development, Suhr Risk Services With less than three years in the industry, Cameron Suhr has already become a hot commodity. In addition to running operations for his agency, he runs acquisitions initiatives to drive inorganic growth, heads up the company’s marketing arm and functions as the agency sales manager. Suhr is active in state and local associations and recently received the Harlan Miller Award, recognizing outstanding dedication to the political grassroots programs of the IIABA. “Cameron is the catalyst behind our outstanding results, as his tireless work ethic and leadership skills are deeply respected by both long and short term agency staff,” says Suhr Risk Services CEO John Suhr.

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Robert H. Sanders Jr. Executive VP, Preferred Specialty LLC Robert H. Sanders Jr. is the executive vice president of Preferred Specialty LLC, a subsidiary of the company his father founded, Preferred Reinsurance Intermediaries. Sanders started in the industry working part-time at his father’s company while in college. After graduation and a couple of internships at Essex Insurance Company and All Risks Ltd., Sanders formed Preferred Specialty as a wholesale firm. Ten years later, the company is a Lloyd’s of London registered broker and contracts with many A-rated U.S. carriers. An IBA Young Guns alumnus, Sanders currently serves as vice president of the Under Forty Organization board of AAMGA and is the education chair of NAPSLO’s Next Generation. He is a recipient of the Order of the Silver Crescent, South Carolina’s highest civilian award for significant contributions, leadership, volunteerism and influence within the community.

Robert Benmosche CEO, AIG Despite a 2010 cancer diagnosis, Robert Benmosche reversed his intent to retire in 2012 and continued to fine-tune AIG’s focus to property/casualty. Under Benmosche’s leadership, the company repaid the $182.3 billion bailout it received from the government in the wake of the 2008 financial collapse. Benmosche retired this year.

David Springer President, TMPAA

Jim Masiello Founder, Chairman & CEO, SIAA With the Strategic Insurance Agency Alliance, Jim Masiello created a model that makes it possible for member agencies to gain access to many of the nation’s biggest and best insurance companies as well as gain access to support services usually beyond the reach of smaller agencies. Under his leadership, SIAA rose to new heights in 2014. The alliance signed its 5,000th member last year, and members reached more than $5 billion in combined premium. SIAA now connects 48 master agencies over the 48 contiguous states, making it the nation’s largest alliance of independent agencies. Masiello has also fostered a system that has created nearly 3,000 new independent agencies since 2000. “Our formula is simple,” Masiello says. “We find good people who want to succeed but have limited access to competitive companies and other resources. We enable them to use their hard work and determination to grow successful independent insurance agencies.”

Bevin Beatovic Director, Outsource Insurance Professionals As the director of Outsource Insurance Professionals, Bevin Beatovic is making a worldwide difference. Under her leadership, the US-based company has been able to create jobs in Serbia, a country rife with unemployment. She’s been able to attract some of the country’s best and brightest, who in turn help MGAs and carriers across the United States expand their businesses. Beatovic has set standards that have made OIP an exemplary US company while also creating a positive culture for its employees in Serbia.

Jacob Shuler Founder and president, CECO Insurance Jacob Shuler built CECO Insurance from scratch. He did that by focusing on the insurance needs of small businesses – in particular, group health solutions. He single-handedly achieved Platinum Broker status with United Healthcare, a distinction usually held only by long-established firms with many agents. Shuler was also named to Humana’s Leadership Circle.

As president of the Target Markets Program Administrators Association, David Springer lead the organization’s efforts to meet the unique challenges of program specialists, who administrate insurance products targeted to particular niche markets or classes. Springer is also president and CEO of NIP Programs, one of the nation’s largest specialized insurance and risk management intermediaries. 32 | JANUARY 2015

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Anticipating the needs and emerging risks of customers, delivering solutions that help them best manage risk and relentlessly focusing on doing things right are some of the pillars of our success.

2015

Doreen Spadorcia Vice chairwoman, The Travelers Companies Doreen Spadorcia started her career at The Travelers Companies 20 years ago as an attorney in the claims department. Within eight years, she had been named bond claim operation manager and general counsel for bonds. In fewer than 10, she was president and CEO of the bond division. Today, as vice chairwoman, she oversees risk control, analytics, marketing, and operations and systems. Active in her community, Spadorcia has served as the vice chair of the Major Corporate Division for the United Way of the Capital Areaâ&#x20AC;&#x2122;s community campaign and on the board of directors of the Travelers Foundation and KickStart International.

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Stan Galanski President and CEO , The Navigators When Stan Galanski agreed to cover an interview for his college roommate in 1980, he had already accepted a job at Proctor & Gamble. But by the end of the interview at Chubb in Pittsburgh, Galanski knew he’d found his calling. He took a third less salary and gave up a company car to go to work for Chubb. His gamble paid off; by 1995, he was running field operations at the company. He moved on to become president of the New Hampshire Insurance Company for AIG, then was recruited to run Intercargo, a small-cap specialty insurer in suburban Chicago. In 2001, Galanski took over as president and COO for the Navigators Group, and was promoted to CEO in 2003. Since then, the company has expanded from 110 to 630 employees and grown its business from $200 million to $1.5 billion. It’s also expanded its footprint beyond the U.S., opening offices in Belgium, Denmark, Italy, Sweden, France and the Netherlands.

John D. Finnegan President, chairman and CEO, The Chubb Corporation Sue Brennan Owner and president, Countrywide Brokerage Sixteen years ago, Sue Brennan left a large national brokerage to take over a fledgling brokerage firm in Edmonds, Wash. Since then, she’s built Countrywide Brokerage into a firm with a stellar reputation for underwriting expertise and a wide product range. Acknowledged by her peers in the US and abroad for her expertise and integrity, Brennan has been called on to educate legislators about insurance matters. She also takes pride in never having laid off an employee at Countrywide Brokerage, even during times of economic hardship.

During John Finnegan’s tenure at The Chubb Corporation, the company has won numerous awards and accolades for customer service, financial performance and diversity in leadership. In 2010, Fitch Ratings ranked Chubb number one among the 25 largest property/casualty insurers for financial performance over the previous five- and 10-year periods. The company also was named one of American’s most trustworthy companies by Forbes. Finnegan is also a proponent of workplace inclusivity; Chubb is a past winner of the Catalyst Award for empowering and developing women.

James A. Roe President, Arlington/Roe When Jim Roe joined his Arlington/Roe in 1980, his father’s firm employed seven associates and wrote $1.3 million in premium. Today, the firm has 160 associates and is writing $185 million – a number 65% above where it stood only four years ago – and has set a goal of $300 million by 2020. Roe is also passionate about improving the industry as a whole. He’s served as president of the American Association of Managing General Agents and continues to support numerous industry organizations. “Jim employs people who are smart, work hard and care about doing the right thing for customers and teammates,” says Helen Cassada, vice president of Arlington/Roe. “Jim tells us that if we help people, the profits will come.”

Milorad Piper Aerospace underwriter, Swiss Re Milorad Piper’s experience and enthusiasm has allowed Swiss Re to make great inroads into the aviation insurance sector. Piper has been instrumental in growing the Swiss Re aerospace book by 169% in just two years. “He is creative in his thinking [about] risks and finds a solution for most risks, greatly assisting the agents and insureds with his innovative solutions to complex aerospace situations,” says Swiss Re’s Paul O’Ryan.

Tony Fierro President, K&S Insurance Agency Tony Fierro was named president of K&S Insurance earlier this year. Already a top producer, Fierro has around $1.5 million in annual commissions. He’s also enthusiastic about sharing his knowledge, mentoring a staff of 13 agents. Under Fierro’s leadership, that staff has grown the agency from $4.5 million in revenue in 2009 to about $9 million for 2014. He’s also helped grow the agency an average of 15% annually and improved the company’s service model, adding internal claims, loss control and stewardship services.

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To increase their competitive advantage and further their value as trusted advisor, agencies and brokerages are rapidly adopting new and more powerful technologies to drive business growth and ensure they deliver the type of client experience consumers have come to expect from all industries.

Reid French CEO, Applied Systems Applied Systems CEO Reid French joined the company in 2011 after seven years at Intergraph Corporation, where he was instrumental in growing revenue by 60%. As the leader of Applied Systems, French spearheads the development and fostering of relationships in the Applied community. Under Frenchâ&#x20AC;&#x2122;s leadership, Applied Systems is meeting the demands of an increasingly global market by providing new technology and expanded multinational capabilities.

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Michele Sansone President of North American property XL Group

Kevin Strong Director of global programs and network services, XL Group Kevin Strong is a recognized industry expert in international insurance. While working with AON Services and Marsh USA, he designed complex insurance programs and coordinated global servicing. After joining XL Group in 2012, he launched the Global Program Center of Excellence to prepare XL to offer local insurance globally. Under Strong’s leadership, 10 countries were added to XL’s books.

Earlier this year, Michele Sansone was appointed president of XL Group’s North American property group, as well as XL GAPS, its loss prevention team. In that capacity, she leads XL’s property underwriting, risk engineering and broker relationship efforts across the country. A 25-year industry veteran, Sansone has amassed unparalleled knowledge in the management of global property risk. Her passion for the industry has helped XL Group grow its Platinum book of business and extend its available capacity to $1 billion.

Quincy L. Branch President and CEO, Branch Benefits Consultants Quincy Branch started Branch Benefits Consultants with a small book of business he’d purchased from the agency where he’d previously worked. Three years later, he’d grown that book of business several times over. In the last year, Branch has added property and casualty lines and grown them to millions of dollars in written premiums. As chairman of the IIABA Young Agents Committee, he grew membership by 15% and raised thousands of dollars for insurance education at the high school and college levels. Earlier this year, he was honored as the Nevada Young Agent of the Year.

David C. Smith Vice president, EbenConcepts David C. Smith began his career in the early 1990s as a policy advisor to North Carolina Lt. Gov. Dennis A. Wicker. In that capacity, Smith was responsible for drafting the state’s Small Group Health Insurance Reform laws. He was also policy director for the State Health Plan Purchasing Alliance Board. Today, as vice president of EbenConcepts, he directs all compliance matters for the agency and serves as primary sales director for technology and risk management strategies for larger clients. Smith has been recognized as one of the nation’s top health plan advisors and is a sought-after expert and speaker on benefit issues as they apply to employers. This year, he received the Frederick W. Joyner Distinguished Service Award, the highest honor bestowed by North Carolina Association of Health Underwriters.

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Timothy Horton President, USG Insurance Services Timothy Horton started his career in insurance in 1991, after serving seven years in the Marine Corps and being deployed in Operation Desert Storm. Horton started out as an underwriter with Burns & Wilcox before joining his father in 2001 to help build USG Insurance Services. Horton spearheaded USG’s expansion to 11 offices in eight states – the result of organic growth rather than acquisition – and led the development of the company’s proprietary agency management system, Broker Management Exchange (BMX). This tech solution is currently being monetized and is expected to hit the market in 2015. Since assuming the presidency in 2010, Horton has added specialized divisions to the agency, including a premium finance company, an inspection company and an insurance-focused advertising and public relations subsidiary.

Janet Trautwein Executive VP & CEO, National Association of Health Underwriters As the CEO of the NAHU, Janet Trautwein is one of the most powerful people in the insurance industry. She manages and represents more than 100,000 employee benefits professionals. Trautwein frequently testifies before Congress on health plans and health insurance markets. In 2004, she received the Harold R. Gordon Memorial Award, the most prestigious award in health insurance.

Matthew Hulburt Director of branch operations, Burns & Wilcox Insurance Matthew Hulburt was just an intern when he joined Burns & Wilcox Insurance in 2008, but he was soon moved into a management trainee position. Within two years, he was one of the top 50 producers in the company. Today, he’s in the top 20. Hulbert was instrumental in taking Burns & Wilcox’s Sacramento location from a $13 million office to a $27 million office in less than four years.

Curtis Anderson President of MGA/binding operations, Risk Placement Services

Terry Ledbetter President, CEO and chairman State National Companies Terry Ledbetter co-founded State National Companies in 1973 and serves as president, CEO and chairman of the board. Under Ledbetter’s guidance, State National has been a leading provider of insurance solutions for more than 40 years. The company is a leader in property and casualty insurance, leveraging its ‘A’ rating from A.M. Best and expansive licenses and reputation to provide property and casualty coverage to a wide variety of insurance industry clients. This year, Ledbetter led State National to a listing on the NASDAQ stock exchange, allowing the company to capitalize on additional financial and operational opportunities.

As president of the nation’s largest managing general agency, Curtis Anderson is a leading figure in the wholesale space, playing a key role in reshaping the marketplace. Anderson is also one of the main drivers behind Risk Placement Services’ merger and acquisition activity. Anderson is also dedicated to advancing the industry as a whole; a past president of AAMGA, he’s still active in the organization. “Curtis’ leadership allowed us to fundamentally upgrade our bylaws,” says Bernie Heinze, AAMGA executive director. “Curtis was a president who got things done.”

Dan Epstein CEO, ReSource Pro Dan Epstein knows that without fresh blood, the insurance industry is in trouble. He’s found a way to engage millennials and attract them to careers in insurance; more than 90% of ReSource Pro’s nearly 1,400 employees are millennials. He’s also led the company to multi-year revenue growth, exceeding 25% per year since 2008.

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For me, the most rewarding thing about being in the insurance industry is the continuum of service we can offer to families. Itâ&#x20AC;&#x2122;s that cycle of life and service that makes my job so challenging and so much fun.

Christopher Cook President, Alliance Insurance Services Christopher Cook built Alliance Insurance Services from the ground up. In 2004, he took the knowledge heâ&#x20AC;&#x2122;d gleaned from two years in the industry and grew his one office to three in North Carolina and Florida. Alliance Insurance Services was named a Best Practices Agency by the IIABA in 2013 and 2014.

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Rep. Jeb Hensarling Chairman, House Financial Services Committee Rep. Jeb Hensarling helped secure the long-term reauthorization of the Terrorism Risk Insurance Act, though with hopes of gradually phasing out most government assistance in terrorism insurance.

Rep. Maxine Waters U.S. House of Representatives Rep. Maxine Waters co-sponsored the Biggert-Waters Act, which would raise flood insurance premiums. But once it became clear that homeowners in some states could see premium increases of up to 1,000%, she worked to delay implementation of the act. “I feel a responsibility to straighten out the unintended consequences,” Waters said, “and deal with it I will.”

Andrew McMellin CEO, Catlin US Andrew McMellin joined Catlin in 1999 as a class underwriter for non-marine liability business. Today, he heads Catlin US, a $1.2 billion operation with offices throughout the country. As part of the Catlin Group, Catlin US provides access to global product and claims expertise. McMellin will become head of Catlin’s UK operations in 2015 as part of a planned transition of responsibilities.

John Tiene CEO, Agency Network Exchange John Tiene’s Agency Network Exchange model allows independent agencies to maintain ownership and control of their businesses while gaining access to a greater number of carriers and products. The model is working, too; ANE generated a combined $350 million in premiums in 2013.

Patrick Byrne CEO, Overstock.com

JB Woods, Owner, Greenpoint Insurance Advisors When Colorado legalized marijuana for medicinal use in 2000, JB Woods knew it was just a matter of time until the drug was legalized for recreational purposes. When full legalization finally came, Woods found himself ideally situated as the proprietor of one of the nation’s only cannabis-focused independent insurance agencies. Today, he can barely keep up with demand, and already boasts a premium volume of 140% over last year.

Overstock.com launched an insurance agency this year with plans to sell auto, home and small business insurance over the internet – a plan that could spell trouble for brokers and agents. CEO Patrick Byrne believes that tech platforms, not brokers and agents, are the distribution channels of the future. And he may not be far off; according to some estimates, up to $400 billion in insurance premiums could switch from traditional channels to internet and phone-service companies.

Jeff Cruey Divisional president, specialty property and AgriBusiness, Great American Insurance Group Earlier this year, Great American Insurance Group named Jeff Cruey the divisional president of its specialty property and AgriBusiness division. In that capacity, Cruey leads a division that has been insuring farm and ranch properties for more than 100 years. And with more than 30 years of industry experience, Cruey is up to the task. Prior to joining Great American, Cruey served as vice president of commercial lines at Ohio Casualty Insurance/Liberty Mutual AgencyMarkets.

Jonathan E. Michael Chairman and CEO, RLI As chairman and CEO of RLI, Jonathan E. Michael heads up an industry leader in property and casualty coverages and surety bonds, serving niche and underserved markets. RLI was recently named one of the best companies to work for in insurance, and is an IBA five-star carrier.

Hank Haldeman President, NAPSLO As executive vice president and a director of The Sullivan Group, Hank Haldeman volunteers his time as president of NAPSLO, leading the organization’s efforts to advocate for the surplus lines industry, educate industry professionals and attract the next generation of insurance pros to the surplus lines industry. Haldeman has been honored with the Charles A. McAlear/NAPSLO Industry Award, the Richard M. Bouhan Legislative Award and the California Insurance Wholesalers Association’s Industry Achievement Award.

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Liam Hutelmyer Underwriter, AmWINS Transportation Underwriters Liam Hutelmyer started his insurance career about six years ago as an underwriting assistant. Now he’s an underwriter with a book of business worth more than $4 million. Hutelmyer helped develop an in-house rating system that increased efficiency and gave AmWINS a competitive edge. In 2013, he was named MVP of the AmWINS Group for embodying the company’s mission, vision and principals.

Kimberly Waller and Phillip Styles Executive vice presidents, Willis North America Richard Schmitzer CEO, James River Insurance Company Richard Schmitzer heads up James River Insurance Company, which has made headlines recently by partnering with ride-sharing service Uber to provide its drivers with a commercial specialty auto policy. Ride-sharing services like Uber and Lyft have come under fire in recent months for failing to insure their drivers.

Kimberly Waller and Phillip Styles co-lead Willis Open, Willis North America’s new practice group that helps firms build alliances with women- and minorityowned businesses. Chicago-based Waller formerly served as COO at Aon Corporation; Atlanta-based Styles served as director of supplier diversity and strategic alliances at Aon Cornerstone. “With over $100 billion in annual minority business enterprise spend, diversity partnerships have become a major strategic initiative for companies,” says Willis North America chairman and CEO Vic Krauze. “Given the increasing importance of supplier diversity to firms across all sectors, the Willis model provides a winning platform for clients.”

Sylvia Mathews Burwell, Director, Department of Health and Human Services

Sylvia Mathews Burwell stepped into a firestorm when she replaced controversial Health and Human Services Director Kathleen Sebelius, who stepped down in April. Sebelius took the lion’s share of the blame for the rocky rollout of Healthcare.gov and the many delays that marred Obamacare’s first year. Burwell has inherited some of that headache, having to face the heat when it turned out the administration had padded enrollment numbers by including nearly 400,000 dental subscribers.

Steve Beshear Governor, Kentucky Kentucky Gov. Steve Beshear helmed the successful rollout of Kentucky Kynect, widely lauded as the most flawless of the state health insurance exchanges in a difficult year. Kynect leaders sought input from agents and brokers in its design and made improvements for the 2015 open enrollment season. By April 15, 2014, more than 410,000 Kentuckians had signed up for health care plans through Kynect.

David Bresnahan Executive VP, Berkshire Hathaway Specialty Insurance David Bresnahan is responsible for Berkshire Hathaway’s casualty, healthcare professional liability, executive and professional business lines. An industry veteran with nearly 25 years’ experience at companies from AIG to The Chubb Group, Bresnahan helped Berkshire Hathaway Specialty Insurance grow its direct premiums more than 48% since the first quarter of last year.

Brian Hudler First vice president, energy and marine group, Alliant Insurance Services Brian Hudler started from scratch in the insurance business about seven years ago. Since then, he’s become one of the leading experts in the energy sector. Starting in the insurance business at EnRisk Services, a Fort Worth-based firm later acquired by Alliant, Hudler was mentored by EnRisk CEO John Ludwig on the intricacies of both insurance and the energy space. “Brian has emerged from this process as both a successful producer and an oil and gas industry expert,” Ludwig says. “Brian is a testament to the fact that hard work pays off.” JANUARY 2015 | 41

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Stephen Ruschak President and COO, The Guarantee Company of North America USA Leading the US operations of the oldest surety and fidelity company in North America, Stephen Ruschak has spearheaded the profitable growth transformation of the company since joining in 2009. Under his leadership, The Guarantee US has grown its premium base by almost 70% by assembling a talented, energetic team of surety professionals. Building strong relationships with producer partners has been the key to writing sustainable surety business.

Matt Letson President, AAMGA Matt Letson leads the American Association of Managing General Agents, an organization recognized as the voice of the wholesale and excess and surplus lines insurance industry. “The AAMGA is stronger than ever,” Letson says. “Our membership represents a larger share of both Admitted and E&S premium than it ever has in its 88-year history, our meetings are still the ultimate venues for relationship-building and getting work accomplished, our university offers more course offerings than ever, and we enjoy a great partnership with Georgia State University through the AAMGA Chair on Risk & Insurance Management.”

Richard A. Clements President, PIA As president of the National Association of Professional Insurance Agents, Richard Clements heads a group that has represented independent insurance agents since 1931. Clements works to further agents’ interests through education, lobbying and working with carriers and industry organizations.

David McElroy Chairman and CEO, Arch Insurance

Gary C. Petrosino Chairman, IICF

David H. McElroy joined Arch Insurance Group in 2009 as president of the company’s Financial and Professional Liability Group. In 2012, he was named chairman and CEO of both Arch Insurance Group and Arch Worldwide Insurance Group. McElroy leads the global insurer as it provides superior coverage and service to clients across the world.

Gary Petrosino is chairman of the national board of governors of the Insurance Industry Charitable Foundation, an organization dedicated to assisting people in times of need. Petrosino heads up the IICF’s efforts to help communities by providing grants, volunteer service and leadership. The IICF has contributed more than $18 million in local grants, more than 155,000 hours of volunteer service and the leadership of more than 25,000 industry volunteers for programs to enhance education, help at-risk children, improve health and safety, increase disaster preparedness and protect the environment.

David A. Sampson President, PCIAA David A. Sampson heads up the Property Casualty Insurers Association of America, which represents more than 1,000 homeowners, auto and business insurance companies that together write 39% of the country’s property casualty insurance. Sampson spearheads PCI’s advocacy efforts on the state, federal and global levels. An acknowledged industry expert, Sampson is a sought-after speaker at insurance events and has been tapped for his expertise by the Wall Street Journal, the New York Times, Bloomberg and other national news outlets. Prior to joining BCI, Sampson served in the George W. Bush administration as deputy secretary of the Department of Commerce and Assistant Secretary of Commerce for Economic Development.

Adam Hamm President, NAIC Adam Hamm began his career as a prosecutor for the North Dakota State Attorney’s Office. In 2008, he was elected as the state’s insurance commissioner, a post he still holds. Hamm is also the current president of the National Association of Insurance Commissioners, an association of chief insurance regulators from all 50 states. In that capacity, he leads the association’s efforts to develop standards and best practices for insurance supervision.

Stephen Riemer CEO, Regency Insurance Brokerage Stephen Riemer is a busy man. He’s the president of Regency Insurance Brokerage Services and holds active roles in five other companies – and inactive roles in 13 more. He’s the past president of Regency Life Insurance Company, Insurance Premium Finance Company and Regency Premium Finance Company, among others. Not content to stick to insurance, Riemer was even once the president of Miami Antique Slot Machine Company.

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Ken Butler Founder and general manager, Evolution Agency Management Ken Butler founded Evolution Agency Management in 2007 with the goal of bringing a stateof-the-art agency management system within the reach of any property and casualty agency. One of the company’s innovations is its “Agent’s Bill of Rights,” which promises agents the freedom to make system choices based on their needs and interests. Butler believes that every agency, no matter the size, should have access to a state-of-the-art agency management system, and that agencies shouldn’t be mired in expensive long-term contracts.

Lori Rafkin SVP, customer and broker engagement Berkshire Hathaway Specialty Insurance As senior vice president of customer and broker engagement, Lori Rafkin has a long track record of engaging customers and business partners, with more than 20 years of experience in business development, strategic planning and global client service in the commercial finance and insurance industries. Prior to joining Berkshire Hathaway, Rafkin worked for Zurich Insurance, where she was the company’s broker relationship leader for North America.

Robert Darling Marketing director, Atlantic Specialty Lines An expert sales and marketing leader, Bobby Darling is the voice of Atlantic Specialty Lines, a wholesale broker and specialty lines MGA. As director of marketing, Darling leads the way in developing marketing and messaging strategies to build brand awareness.

Bob Rusbuldt President, IIABA Bob Rusbuldt heads the Independent Insurance Agents and Brokers of America (the Big “I”), a national alliance of more than a quarter of a million agents and brokers. As such, he spearheads the organization’s efforts to monitor and effect legislation and regulation affecting agents, brokers and small businesses.

Michael J. Pilla CEO, Technical Risk Underwriters Mike Pilla formed Technical Risk Underwriters, a series of RSG Underwriting Managers and specialty underwriters of insurance for complex property and construction risks, in 2010. Pilla has more than 38 years of experience underwriting tough construction and marine lines of business; he worked for 30 years in senior management positions at GRE and Liberty National Underwriters. He also developed large underwriting authority grants for companies like Munich Re, AIG and Lloyd’s of London.

Norbert Hohlbein President, Builders & Tradesmen’s In 1992, Norbert Hohlbein developed an artisan contractor program. By 1998, Hohlbein had decided he wanted to go into business for himself. He developed that program into the basis for Builders & Tradesmen’s Insurance Services, a leading provider of insurance for the construction industry.

David and Kenneth De Berry CEO and president, Concord Specialty Risk Brothers David and Kenneth De Berry, co-founders of Concord Specialty Risk, collectively have more than two decades of experience underwriting transactional risk insurance. David, who serves as Concord’s president, is an attorney with experience in both transactional matters and litigation who also served as an insurance executive at an A+ carrier prior to forming Concord. Kenneth, who serves as president, is a CPA with treasury experience at several Fortune 100 companies.

Tom Lott Senior vice president, AmWINS Group With more than two decades in the industry, Tom Lott has a lot of experience to share. And share it he does, mentoring and coaching less experienced insurance professionals. “His leadership and guidance have left a wake of well-rounded professionals who are dedicated to the insurance industry and seeking to make a similar impact,” says Jessica Marshall, AmWINS assistant VP of marketing and business development. Lott also has a passion for community service, and was the driving force behind Community Matters Insurance Partners of Charlotte, a nonprofit bringing more than 75 Charlotte, N.C., insurance firms together to raise money and volunteer for local charity organizations.

Tom Pontarelli EVP and chief administration officer, CNA As the executive vice president and chief administration officer at CNA, one of the country’s largest property and casualty companies, Tom Pontarelli oversees human resources, facilities, and safety and security, as well as heading up public affairs, communications and advertising efforts – in addition to handling enterprise sourcing, business process reengineering, information technology and worldwide operations for the company.

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SPECIAL REPORT / HOT 100

Jonathan Tallman Financial advisor, Tallman Group Jonathan Tallman began his career in financial services with a college internship at Northwestern Mutual, receiving his insurance license at the age of 18. In 2011, he started the Tallman Group, a boutique financial services firm specializing in life insurance, disability insurance, long-term care insurance and investing for retirement and educational needs. Tallman serves on the Okaloosa County (Fla.) Restore Act Advisory Committee, which works on methods to distribute funds allocated to the county following the BP oil spill. He’s a member of the National Association of Insurance and Financial Advisors, the Florida Association of Insurance and Financial Advisors, and the Emerald Coast Association of Insurance and Financial Advisors. In 2013, he was appointed to the board of directors of his local chamber of commerce. The same year, Tallman was recognized as one of the 12 most interesting people under 40 by Emerald Coast magazine.

Kevin Tromer Owner, president and CEO Team Focus Insurance Group Kevin Tromer is the owner, president and CEO of Team Focus Insurance Group, which is made up of several different insurance entities, the oldest of which was established in 1946. Under Tromer’s leadership, the company has grown from a few dozen employees to more than 400 and from serving a few thousand policyholders in Florida to serving hundreds of thousands across multiple states. Tromer is also a co-founder of the Focus Foundation, which helps feed the needy in the community and improve insurance education.

Dusty Rowland President and owner, Fulcrum Insurance Programs Dusty Rowland started Fulcrum Insurance Programs in 2008, and even at the height of the economic crisis, he was able to grow the firm; this year, the company was named one of the fastest-growing companies in Washington state. Rowland is also committed to the environment; Fulcrum was recognized last year as one of Washington’s leaders in sustainability. Fulcrum is also active in local charity, with employees volunteering at Hopelink, Outdoors for All, Habitat for Humanity, Make a Wish Foundation and the USO. Rowland encourages his employees to donate to worthy causes by providing donation matching.

INDEX BY COMPANY Company AAMGA AAMGA ACE Group Agency Exchange Network AIG Alliance Insurance Services Alliant Insurance Services AmWINS Group AmWINS Transportation Underwriters Applied Systems Appulate Arch Insurance Arlington/Roe Atlantic Specialty Lines Beacon Hill Associates Berkshire Hathaway Specialty Insurance Berkshire Hathaway Specialty Insurance Branch Benefits Consultants Builders & Trademan's Burns & Wilcox Brokerage Burns & Wilcox Insurance CNA Capstone Underwriters, LLC Catlin US CBIZ-Sattler Insurance Agency CECO Insurance

26 42 45 40 32 39 41 43 41 35 28 42 34 43 31 41 43 36 43 24 38 43 30 40 26 32

Name

Company

Heinze, Bernd Letson, Matt Lupica, David Tiene, John Benmosche, Robert Cook, Christopher Hudler, Brian Lott, Tom Hutelmyer, Liam French, Reid Nikouline, Dimitri McElroy, David Roe, James A. Darling, Robert Pritchard, Bill Bresnahan, David Rafkin, Lori Branch, Quincy L. Hohlbein, Norbert Brady, Denis Hulburt, Matthew Pontarelli, Tom Bellet, Alain A. McMellin, Andrew Sattler, Jim Shuler, Jacob

Concord Specialty Risk Countrywide Brokerage Department of Health and Human Services EbenConcepts Epic Insurance Solutions Erickson-Larsen Evolution Agency Management EvoSure EZLynx First National Brokerage Company Fulcrum Insurance Programs Gamma Iota Sigma Great American Insurance Group Green Leaf Insurance Guarantee Company of North America Higginbotham House Financial Services Committee IIABA IICF Innovative Benefit Solutions Ironshore Insurance Ironshore Insurance James River Insurance Company K&S Insurance Agency Kentucky Liberty Mutual Lloyd's of London

Name 43 34 41 36 26 28 43 26 30 30 44 30 40 40 42 30 40 43 42 31 27 28 41 34 41 26 31

De Berry, David and Kenneth Brennan, Sue Burwell, Sylvia Mathews Smith, David C. Thompson, Donald B. Larsen, Merwyn Butler, Ken Foran, Matt Rao, Nag Waters, Lindsey Rowland, Dusty Codispoti, Noelle Cruey, Jeff Woods, JB Ruschak, Stephen Lee, Mark Hensarling, Jeb Rusbuldt, Bob Petrosino, Gary C. Waldych, Joni Boren, Joseph L. McAuliffe, Tim Schmitzer, Richard Fierro, Tony Beshear, Steve Nolan, Tiffany Beale, Inga

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2015

David Poms Owner & President, Poms & Associates As the owner of Poms & Associates, David Poms leads one of the fastest-growing brokerage firms in the western United States. Since its founding in 1991, the company has grown to include more than 200 employees in branches across the country. Poms & Associates is consistently chosen as one of the best places to work by insurance publications, and was recently named a top insurance brokerage firm by Albuquerque Business First.

Sharon Emek President and CEO, Work at Home Vintage Employees When she founded WAHVE in 2010, Sharon Emek created a system that allowed seasoned insurance employees to use remote technology in order to continue working while phasing into retirement – a process she calls ‘pretirement.’ The company’s business model galvanized Baby Boomer insurance pros – and addressed the industry’s talent shortage.

Mark Walls VP of communications and strategic analysis, Safety National Mark Walls is widely recognized as a thought leader in the workers’ compensation space. In 2014, he participated in 19 educational sessions at 11 national conferences. He was also a speaker in five webinars. He’s the founder and manager of the Work Comp Analysis Group , which, with more than 24,000 members, is the largest insurance group on LinkedIn focused on a single product line.

Company NAIC NAPSLO NAS Insurance Services National Assoc. of Health Underwriters Newman Long Term Care Orrino Capital Services Outsource Insurance Professionals Overstock.com PCIAA Philbin Insurance Group PIA Poms & Associates Preferred Specialty LLC Regency Insurance Brokerage ReSource Pro Risk Placement Services Risk Placement Services RLI Safety National SIAA Specialty Risk Management, Inc. State National Companies Suhr Risk Services Swiss Re Tallman Group Team Focus Insurance Group

42 40 24 38 31 26 32 40 42 26 42 45 32 42 38 38 28 40 45 32 24 38 31 34 44 44

David Lupica Division president, commercial risk services ACE Group As division president of ACE Commercial Risk Services, David Lupica leads a division that provides specialty insurance products and services to small businesses through wholesale, retail, MGA and alternative distribution channels. Lupica joined ACE Group, one of the world’s largest multiline property and casualty insurers, in 2000 as executive vice president of ACE USA’s professional risk division. Prior to joining ACE, he held leadership positions at StarrExcess Liability Company, Alexander & Alexander (now Aon) and AIG.

Name

Company

Hamm, Adam Haldeman, Hank Palotay, Michael Trautwein, Janet Newman, Debra C. Orrino, Gino A. Beatovic, Bevin Byrne, Patrick Sampson, David A. Philbin, Tara Clements, Richard A. Poms, David Sanders, Robert H. Riemer, Stephen Epstein, Dan Anderson, Curtis Lynch, Matt Michael, Jonathan E. Walls, Mark Masiello, Jim Ritz, Pamela Ledbetter, Terry Suhr, Cameron Piper, Milorad Tallman, Jonathan Tromer, Kevin

Technical Risk Underwriters The Chubb Corporation The Dana Company The IMA Financial Group The Navigators The Right Choice Insurance Agency

43 34 24 28 34 31

Pilla, Michael J. Finnegan, John D. Ramundt, Dana Cohen, Robert Galanski, Stan James, David

Name

The Travelers Companies, Inc.

Spadorcia, Doreen

TMPAA

Springer, David

U.S. House of Representatives

40 Waters, Maxine

U.S. Risk Underwriters

30 Burdett, Cason

USG Insurance Services

38 Horton, Timothy

USG Insurance/USG Holding Group

30 Fornof, Troy

Venture Pacific Insurance Services

Barton, Curtis

Walmart

Willis North America

Eckert, Daniel Styles, Phillip and Waller, Kimberly

Work at Home Vintage Employees

45 Emek, Sharon

XL Group

28 Gramm, Michael

XL Group

36 Sansone, Michele

XL Group

36 Strong, Kevin

Zurich Insurance

36 Schiro, James

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PRODUCER PROFILE / WILLIAM FEGGINS

Divine intervention From the streets of Philadelphia to the United Nations, Divine Insurance Group founder William Feggins has always defied the naysayers and kept firm on his vision for the future Ever thought about starting up your own business? What about insuring a niche market segment such as underprivileged communities? Now, how about doing it without any significant source of funding? These were the circumstances William Feggins faced when founding the Divine Insurance Group in 2008. Feggins’ licensed brokerage firm specializes in offering insurance products to low-income markets, seniors and the disabled. Thanks to a mix of optimism, grit and sheer hard work, Feggins and his Divine brand have expanded to being one of the most recognized grassroots insurance providers in the United States. “I started Divine with my own personal savings, without bank financing or angel investors,” Feggins says. “There were many who doubted even a modicum of success. But in spite of those negative statements of caution, I persisted in making Divine the success that it is today.”

PHILADELPHIA, BORN AND RAISED During his upbringing in Philadelphia, Feggins witnessed his fair share of hardships. Although his family life was stable, his outside environment brought him

face-to-face with illegal activity, drug abusers and many who suffered the ills of poverty and disenfranchisement. “In spite of these challenges, I made a personal determination to focus on and execute a plan of action for my life to yield a positive and financially successful outcome,” Feggins explains. “My focus in business is premised on this personal determination.” His determination paid off: By the age of 35, Feggins would be named one of Empact Showcase’s top 100 young American professionals, an honor that earned him a trip to United Nations headquarters in October. “For the past six years, Divine has grown from a start-up insurance agency to a leading insurance brokerage firm with nearly 1,000 contracted licensed agents and offers health and final expense coverage in multiple states,” Feggins says. “I made a decision to break away from another agency and walk with destiny and faith to start my own.” Along the way, he had to overcome challenges such as strengthening the company’s competitive advantage, harnessing capital for further emerging growth, and establishing customer loyalty and trust in the Divine brand.

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“There were many who doubted even a modicum of success. But in spite of those negative statements of caution, I persisted in making Divine the success that it is today”

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PRODUCER PROFILE / WILLIAM FEGGINS

FEGGINS’ 5 LIFE LESSONS Now in its fourth year, the Empact Showcase awards program recognizes America’s top young entrepreneurs. During his speech at the Showcase, Feggins highlighted some lessons he has learned throughout his journey as an insurance entrepreneur:

Prepare for growth. Begin to align yourselves with individuals of like-minded character, as these individuals will provide both healthy competition and force you to reach your full potential. Preparing for growth also means establishing a private education and enrichment program. Reading and watching education programs will allow you to broaden your understanding and structure your mind to yield a stronger thinking capacity.

Manage credit well and stay on top of your finances. For many successful business leaders, savings and/or personal creditworthiness is all they had from the start. Create a budget that will allow you to not spend above your means and also allow you to save for a rainy day. Strive to achieve the highest credit score possible by establishing a sound payment history with your creditors and using credit responsibly. Look at your credit report and determine how you can correct errors or remove outdated items that are having a negative effect on you. Do not create bills or liabilities that you don’t need. Remember, your credit score is a major determinant of whether you will qualify for access to capital.

Honor commitments. Aside from your credit report, establish a reputation among your colleagues, family, friends, customers and business associates that you are a man or woman of your word. People tend to gravitate toward those whom they can easily trust.

Network. You must find ways to network at business functions and make the investment to establish new relationships and contacts. Of the 25 people you may meet at an event, perhaps one may have a need that your business can satisfy. You also may meet someone that you can help and inspire to become more successful.

Be a blessing to others. I firmly believe that you reap what you sow. Live a life that inspires giving, helping, empowering and making your neighborhood, community, nation and world a better place. Adopt a mission as part of your human destiny that includes helping others. Contrary to what others may say, we are all human. After the Cuban Missile Crisis, President Kennedy gave a speech in which he stated, “For in the final analysis, our most basic common link is that we all inhabit this small planet, we all breathe the same air, we all cherish our children’s futures, and we are all mortal.” You and I are the leaders of the 21st century. And we have a chance to make a profound mark on this world. We can’t accept ‘no’ for an answer and can’t fail to try. We must be prepared to work hard to achieve what many may classify as ‘impossible.’ That is what makes us leaders – we defy the odds.

Throughout the challenges, Feggins held fast to his core values of ethical actions and daily growth. These values have become the primary tenets of Divine Insurance Group, which aims to provide customized and affordable insurance solutions in an ethical way to consumers while also offering financial literacy to employees and agents to empower them to be successful.

ALTRUISTIC INTENTIONS Through founding Divine Insurance Group, Feggins has not only worked with health care officials and community leaders to help underserved areas, but he has also focused on deep-seated issues such as learning disparities and disabilities within senior populations. “As president of Divine Insurance Group, my top priority is to provide financial literacy services to disadvantaged individuals and communities across the United States, while promoting a better quality of life through insurance services to our clients,” Feggins says. In 2009, he incorporated the Senior Advocate Outreach Program, a nonprofit corporation designed to provide health care educational services for seniors with disabilities. The nonprofit enhances seniors’ awareness of available health care and home support services provided by federal, state and local governments. Divine’s ever-expanding staff of volunteers now services more than 5,000 seniors in the Philadelphia metropolitan area.

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FEATURE / SPORTS & RECREATION

Sports & Recreation:

Wide ﬁeld of opportunity Risk is as rife in sports and ﬁtness businesses as in any other sector. It’s a huge market crying out for multi-faceted coverage. The best part is, lots of players are located right in your neighborhood By Allison Landa It’s big business. For insurance producers, the field of sports and recreation presents a potential goldmine of opportunity given its wide range of specializations as well as its popularity. If you’re looking to get in on the action, you’ll want to consider your professional strengths as well as personal interests before jumping in. “The sports and recreation segment is one of the most exciting … of the insurance industry, and many agents find that their own personal participation in sports or recreational activities provides insight into business opportunities,” says Lorena Hatfield, marketing

resources manager for Fort Wayne, Ind.-based K&K Insurance. “Sports and recreation accounts abound across the country.” According to Hatfield’s K&K colleague, recreation division underwriting manager Cheryl Meyers, local health clubs and gyms present a particularly juicy source of revenue for insurance agents and brokers. On the rise after the downturn of the 2008 financial crisis, these clubs often go underinsured and present an opportunity for a resourceful agent to note potential coverage gaps and thus land new clients. Meyers estimates that there are 23,000

health clubs in the United States. “Statistically, that would be an unlimited program for brokers and agents to send us submissions,” she says. “Small mom-andpop accounts to large or multi-location risks – the opportunities are endless.”

WHAT DO I NEED TO KNOW? When considering the sports and recreation field, many agents may first think of professional teams and large facilities. However, Hatfield points out, there are many other specializations to consider. “Amateur sports teams and leagues and other recreational organizations can

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locker-room and shower environments. “When people start making accusations that don’t fit into the [standard] categories, that’s where you run into issues,” he says. “People are suing for more and more things. If you’re making money off of what is a dangerous activity, you’re … going to get sued.” Meyers says agents are responsible for helping health-club owners to pinpoint potential exposures. Paramount among these are slip-and-fall incidents in wet locker-room or shower areas, as well as in pool and sauna areas. In addition, equipment failure and even participant misuse of such equipment can result in club liability. “A weight machine to which a participant adds barbells on top of the desig-

nated weights, for example, might topple over,” Meyers says. “That’s the participant’s misuse of the equipment, but the venue may still be liable if they were aware of what the participant was doing and didn’t say or do anything to prevent it. It’s almost like a passive agreement.” If you’re looking to land and maintain health-club accounts, you’d be wise to bolster your knowledge of these liability exposures in addition to the ways different jurisdictions manage these types of claims.

WHAT TYPES OF CLIENTS WILL I ENCOUNTER? While it’s a given that sports and recreation insurance agents will run across

GYM, HEALTH & FITNESS CLUBS – THE NUMBERS

$27B

583,075 Employees

2.3%

people belonged to a health club at the beginning of 2013

29,894

20%

Revenue

be found in communities of all sizes in every state,” she says. “K&K offers specialized programs for both professional and amateur sports teams and associations as well as coverage designed specifically for smaller sports teams, leagues, camps, clinics and tournaments.” Paul Martin, the state association liaison at TrustedChoice.com, which represents independent insurance agents, says insuring a gym or fitness club is not altogether different from other businesses. Martin cited considerations such as the property that is owned, liability that can be incurred – such as injuries and property damage – and unique liabilities such as those that come along with cleanliness. Other concerns that are unique to the gym environment include potential harassment worries, given that members are often exposed to one another in

Annual revenue growth 2009-2014

51.3 MILLION

Businesses

of Americans above age 6 are members of a health club

GEOGRAPHICAL DISTRIBUTION

New York

7.1%

Great Lakes

15.2%

West

16.0%

Pennsylvania

4.7%

Mid-Atlantic

18.9%

California

10.8% Southeast

22.9% Texas

6.0% Florida

5.5%

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FEATURE / SPORTS & RECREATION

THE ESSENTIAL COVERAGE YOUR CLIENTS NEED General liability Your first defense against lawsuits, general liability insurance covers most lawsuits involving both participants and spectators. General liability policies should include both your organization/business, directors, officers and volunteers. Directors & officers liability Some lawsuits may charge management with oversight, especially regarding hiring or firing practices. Even if you are innocent, D&O coverage can cover potentially expensive lawsuits. Accident insurance Accident insurance covers medical bills on behalf of injured participants, and may even decrease a threat of a lawsuit. Excess or secondary medical In the event that accident insurance does not cover the full extent of a person’s injuries, excess and secondary medical is essential. Crime Insurance Covers your business or organization in the event of embezzlement or theft. Equipment insurance Whether it’s damaged by vandalism or a severe weather event, the loss of your equipment will be covered by this policy or endorsement.

both professional and amateur sports teams as well as leagues and associations, a plethora of other potential clients exists in this field. Hatfield said that agents may be well advised to consider the lesser-known segments, including health clubs, martial arts, gymnastics and dance schools, sports complexes that host youth sports tournaments, ice- and roller-rink facilities, stadiums, and other venues. “Outside of sports and fitness, recreational organizations like youth camps, campgrounds, resorts, festivals and fairs offer agents new opportunities for growth,” she says. “The festival industry offers excellent opportunities as the number and variety continues to expand – many cities host numerous festivals

PARTICIPANT INJURY IS YOUR CLIENT’S PROBLEM

When a participant or patron is injured, it may not matter if the injury was directly related to the activity or property. You still can be held liable.

$935 million

The average annual medical cost associated with sports-related injuries

36,700

The number of exercise or equipmentrelated injuries in adults 65+ in 2011

$4,700

The estimated average cost of treatment for a leg fracture in 10- to 19-year-olds

1.35 million

Number of people 19 and under who were seen in emergency departments with injuries related to sports and other activities in 2012

47%

Concussions occuring in children ages 12 to 15

Sources: CPSC, ASPE, SafeKids.org

throughout the season, ranging from jazz to barbecue.” K&K has insured festivals and fairs for decades, Hatfield adds, with underwriters who are long familiar with the unusual risks that take place in these and other types of sports and recreational events and who understand the coverage needed for such risks. Sam Muradyan, co-founder and manager of Liberty United Insurance, a North Hollywood, Calif.-based independent agency specializing in the family-fun space, says the amusement industry is growing substantially. “There are usually multiple activities [at the centers] because, from their point of view, they need to attract more clientele,” he says. Additionally, amusement parks and family entertainment centers are big business, given their number of annual visitors. According to the International Association of Amusement Parks, one quarter of Americans surveyed in 2011 said they had visited an amusement park or family entertainment center within the last 12 months; an additional 43% said they planned a visit in the subsequent 12 months.

WHO ARE THE MAJOR PROVIDERS, AND WHAT ARE THE PRIMARY PRODUCTS? In the sports and recreation market, providers vary depending on the type of risk they are undertaking – some providers who underwrite sports do not, for example, offer camp coverage. “Over the decades K&K has been in business, we’ve seen many providers enter the market, only to leave it a few years later,” Hatfield says. “It’s specialty insurance that takes experience to underwrite and price accurately while remaining competitive and having the claims staff in place to manage the very unusual spectator and participant accidents that sometimes occur.” As with providers, coverage may vary, depending on the needs of the

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“A weight machine to which a participant adds barbells on top of the designated weights, for example, might topple over” Cheryl Meyers entity to be insured. Small amateur sports teams and recreational facilities may need less complex coverage than professional teams and large venues that offer a variety of sports and entertainment events. “Depending on the program, coverage may include property, general liabil-

ity, inland marine, boiler and machinery, crime, commercial auto, D&O liability, tenant user liability, excess liability, workers’ compensation and event cancellation,” Hatfield says. Client retention relies on keeping abreast of what they’ll need to continue to stay covered as business continues to

develop. Before every renewal, agents should be in touch with clients to check in on potential changes and to ensure that no additional issues will arise. “Each time an insured changes their exposures, services, and activities; transacts a contract with another party; adds locations, autos, or operations, those would be touch points between the insured and their agent throughout the policy term to ensure appropriate coverage is in place,” says Meyers. Next time they’re down at the gym or taking the kids to Saturday soccer, savvy producers should take a good look around and see lots of business on offer behind the sporting endeavor on display.

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In Person ATTORNEY TURNED INSURANCE COO

Stephen C. Ruschak, president and COO (US) of The Guarantee, sheds light on industry issues and personal accomplishments How did you make your way to being president and COO of The Guarantee?

top professional talent who might not be considering surety or insurance as a viable career path.

The greatest career advice I have ever received was from my father, who told me that “you have to reinvent yourself every few years in order to remain viable and vibrant.” Every new job I’ve started was different from the last. I entered the insurance industry as a surety claims attorney and later became a reinsurance underwriter in Bermuda, handling global surety, fidelity, trade credit and political risk. After a brief stint as a reinsurance broker, I was given a tremendous opportunity to join The Guarantee.

How do you think your previous posts prepared you for the challenges involved in your current post? Being a reinsurance underwriter provided me with a broad understanding of the surety business. I was able to meet with surety executives and listen to their views on the industry and their company’s role in it. I obtained significant insight into industry challenges and market trends.

What’s your favourite part about working in the insurance industry? Working in the surety segment of the insurance industry is a truly rewarding career choice. The broad skill set required of the surety professional complements this dynamic work environment. Additionally, we get to collaborate with a lot of skilled industry experts.

What do you see as potential risks, and how do you plan to deal with them? As a surety professional, you always worry about the overall and construction econo-

Can you elaborate on what you think makes The Guarantee an industryleading corporation?

mies. We still haven’t experienced the expected recovery from the Great Recession, which continues to impact government spending and public construction. We have seen a number of Property and Casualty companies start surety operations in the US over the last few years due to significant underwriting profitability. This phenomenon continues, even though the industry is probably at excess capacity levels. The increased competition will undoubtedly lead to pressure on underwriting terms and industry conditions as the construction economy improves. It’s important for sureties to maintain their discipline as they seek new opportunities. Another concern is how we as an industry attract, develop and retain top professional talent that might not be considering surety and/or insurance as a viable career path. We must do a better job of attracting, developing and retaining

Our people are the greatest asset of The Guarantee. It’s often said that surety is a relationship business and it really is true. Our success over the last couple of years is due to the solid relationships our underwriters have with their agents in the local markets. We get opportunities because of those relationships and then we roll up our sleeves and look for solutions that help the agent and the principal. It isn’t revolutionary, but we work hard to support our partners.

How do you personally try to better the image of The Guarantee, and how do you pass that along to your employees? I’m really passionate about the work we do. As an organization, we all work hard to support our business partners. I encourage a positive environment amongst our team and recognize the hard work they do.

Who are some of the people who have gotten you where you are today? I don’t know where I would be without the support of my wife, Kristin. My parents also provided plenty of support and opportunities. Professionally, Jules Quenneville and Robert Dempsey brought me to The Guarantee and gave me a shot at running a business. It’s been a tremendous experience, and I’d like to think that I have repaid their confidence in me.” JANUARY 2015 | 55

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rs Group aining were

PEOPLE / FAVORITE THINGS

Favorite things Phil Beakes, National E & S Favorite book I read all the time! Sales and marketing books, like How to Sell Without Being a Jerk by John Klymshyn

Weirdest coverage I know a property underwriter who was asked to cover an extremely valuable supply of high-end Italian marble that was in flat sheets and blocks and, because marble is a “living“ rock, was stored completely submerged in water. The underwriter was asked to put up several million dollars of limits, covering the “rock” for fire, even though it was stored under water. There actually was a fire in the warehouse, and smoke and soot got into the water and impregnated the marble to the point of a total loss. This poor guy covered rock, completely under water, for fire and paid out a policy limits claim. You can’t make this stuff up!

Favorite vacation spot Mammoth Mountain, California, for the summer fly fishing and the winter skiing Favorite place to be outside work Running or fishing on the beach with my dog, or making a birdie on a difficult golf hole

Favorite thing about working in insurance Being a trusted advisor to business owners who value the fact I’m as devoted to their business success as they are. I also value every single day I get to train and mentor young producers – that’s the part of the industry that feeds my heart Favorite movie I am a movie re-watcher, and have many favorites – The Legend of Bagger Vance, The Last Samurai, Love Actually, and many others

Favorite music The music of my youth, like James Taylor, Jackson Brown and Fleetwood Mac, but also more contemporary music like First Aid Kit My best day in insurance I was a 24-year-old adjuster, and an old woman gave me a tearful hug and thanked me for taking care of her. It was a very moving moment for me

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Most think the claims process starts when you file a claim. For us, it begins when we first create your policy.

Building trust starts here.

Trust. Itâ&#x20AC;&#x2122;s built into every policy. The people that make the promises at Ironshore keep themâ&#x20AC;&#x201D;and we always will. Fact is, our teams have both production and claims experts that are responsible for your policy, from initial review to potential claim. This enables us to customize the best solution while communicating coverage very clearly. Our consistent approach is why 95% of our clients express satisfaction with our expertise during the claims process. It also eliminates any surprises at a time when you need our support the most. At Ironshore, we have the capacity to keep our promises. More importantly, we have the integrity to back them up. For more information, please go to www.ironshore.com.

The information contained herein is for general informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any product or service.

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Expect big things in workersâ&#x20AC;&#x2122; compensation. Expect to save a third of your clients 30% or more. Most classes approved, nationwide. For information call (877) 234-4450 or visit auw.com/us. ÂŠ2015 Applied Underwriters, Inc., a Berkshire Hathaway company. Rated A+ (Superior) by A.M. Best. Insurance plans protected U.S. Patent No. 7,908,157.

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