Insurance Business America issue 5.01

IBAMAG.COM ISSUE 5.01

AGENTS ON NETWORKS

Agents reveal how they really feel about the service they’re getting from their networks IF YOU CAN’T BEAT ‘EM, JOIN ‘EM

Is the industry ready to stop fighting insurtech and start embracing it?

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GET ON BOARD WITH CYBER

What brokers need to know to prepare for the cyber market’s biggest year yet

ENVIRONMENTAL INSURANCE

Why your clients need this coverage now more than ever

20/01/2017 3:43:43 AM

ISSUE 5.01

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CONTENTS

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UPFRONT 03 Editorial

In tough times, insurance is poised to come out on top

FEATURES

32

ENVIRONMENTAL HAZARDS

COVER STORY

20

Public awareness of environmental issues is growing – here’s how to make sure your clients are protected

PEOPLE

INDUSTRY ICON

2

06 Head to head

Insurtech: threat or opportunity?

07 Opinion

Why insurance firms should consider partnering with startups

08 News analysis

How can agents prepare for cyber insurance’s biggest year yet?

This month’s big movers and shakers

12 Workers’ comp update

A new report reveals the most effective ways to deal with workers’ comp claims

FEATURES

40

DRIVING CHANGE A blueprint for transforming your brokerage – and making the changes stick

As the cyber market continues to take off, Ben Beeson, Lockton’s head of cyber, weighs in on where it’s headed next

16

The customer tide turns online

10 Intelligence

AGENTS ON NETWORKS

From the range of products offered to claims and customer service support, agents weigh in on their networks’ performance in 10 key areas

04 Statistics

14 Technology update

What will it take to convince businesses to purchase cyber insurance?

FEATURES 36 Agency insight

The Buckner Company on achieving 80 years of consistent growth

38 Personality and performance Understanding your employees’ unique personality traits can help you build a higher-performing team

PEOPLE

FEATURES

44

BECOMING A REMARKABLE COMMUNICATOR Are you guilty of one (or more) of these conversational mistakes?

47 Career path

Lori Bailey used insurance as a springboard to a global career

48 Other life

Rinkside with hockey coach Bobby Long

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UPFRONT

EDITORIAL

www.ibamag.com FEBRUARY 2017 EDITORIAL Managing Editor Paul Lucas Journalists Maryvonne Gray, Jordan Lynn, Lucy Hook, Will Koblensky, Ryan Smith News Writers Lyle Adriano, Louie Bacani, Mina Martin, Gabriel Olano, Allie Sanchez Staff Writers Tim Garratt, Libby McDonald, Joe Rosengarten, Heather Turner Editorial Researcher Hannah Go Copy Editor Clare Alexander

CONTRIBUTORS Philipp Kristian Diekhöner, Warren Kennaugh, Michelle Gibbings, Georgia Murch

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

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

CORPORATE Chief Executive Officer Mike Shipley Chief Operating Officer George Walmsley Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil Editorial Inquiries paul.lucas@keymedia.com Subscription Inquiries subscriptions@keymedia.com Advertising Inquiries cathy.masek@keymedia.com, chris.wills@keymedia.com chris.anderson@keymedia.com, megan.roth@keymedia.com

Key Media 78O7 E. Peakview Ave., Suite 115 Centennial, CO 80111, USA tel: +1 720 316 0151 www.keymedia.com Offices in Denver, London, Toronto, Sydney, Auckland, Manila, Singapore, Bengaluru

Insurance Business America is part of an international family of B2B publications and websites for the insurance industry Insurance Business Canada john.mackenzie@kmimedia.ca T +1 416 644 874O Insurance Business UK jonathan.connelly@keymedia.com T +44 20 7193 0935 Insurance Business Australia peter.smith@keymedia.com.au T +61 2 8437 47OO Insurance Business NZ peter.smith@keymedia.com.au T +61 2 8437 47OO

Confusion reigns, insurance wins

W

hat noun would you use to describe the current environment we’re living in? Confusion? Disorder? Maybe even chaos? Chances are, the vast majority would pick a word that reflects the unstable landscape in which we’re attempting to not only live but also do business.

There is, of course, the arrival of a new president – one who actually got more than 2.5 million votes less than his rival. Of course, for those who did vote for President Trump, there is renewed hope and belief that America can rediscover its foundations and become “great” again. However, among the naysayers, there are genuine fears about what lies ahead.

The uncertainty seems to grow even greater across the pond, where Europe has found itself submerged in vitriol over its handling of immigration, where Britain is attempting to stabilize after a decision to pull out of the European Union, and where France and Germany, both subject to recent acts of terror, face their own imminent elections.

Insurance is designed to provide reassurance in times like these – and as fears grow, there are emerging opportunities for the industry. The 2017 Allianz Risk Barometer reported that cyber risks, for example, have risen to second place among the chief concerns for businesses across the US, narrowly behind business interruption. For brokers who are able to quickly capitalize by under-

For brokers who are able to quickly capitalize, cyber is potentially a new, relatively untapped area of business to reap rewards from standing the businesses they work with and presenting a cyber product that genuinely meets their needs, there is potentially a new, relatively untapped area of business to reap rewards from.

Yet the insurance industry, it seems, faces its own state of confusion with a leap in mergers and acquisitions as smaller brokerages struggle with digital innovation and new players emerge. A recent Willis Towers Watson survey put the percentage of insurers looking to acquire based on digital capabilities at 49%.

In times like this, it can be reassuring to have a helping hand – and in this edition of Insurance Business America, we shine the spotlight on the leading insurance networks in the country, which are offering agents increased access to products and niche markets, training and education, and, perhaps most important of all, support. It could be argued that networks are more vital than ever as the industry looks to convert instability into cash.

The team at Insurance Business America

Insurance Business Asia peter.smith@keymedia.com.au T +61 2 8437 47OO Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as the magazine can accept no responsibility for loss.

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20/01/2017 4:38:34 AM

UPFRONT

STATISTICS

Insurtech and consumers

KNOW YOUR CUSTOMERS Accenture’s survey divided insurance consumers into three groups based on their behaviors and preferences: Nomads, who are very interested in shifting to online-only activity; Hunters, who seek value, expertise and advice from people; and Quality Seekers, who prioritize integrity regardless of the channel.

Insurtech is altering the consumer journey – and opening up new opportunities for insurers ADVANCES IN digital technology, combined with shifts in consumer behavior, have opened up a world of opportunity for insurers looking to enhance their relevance and value. That’s the message of a recent survey released by Accenture, which identified three main groups of consumers – Nomads, Hunters and Quality Seekers – each of which have distinct preferences about how they want to interact with insurers.

Of key concern are Nomads, who are interested in shifting to online-only activities. This group is highly digitally active and ready for a new model of delivery. They place a high value on innovation and want new ways of accessing service and advice. For this group, which represents 46% of US consumers, increased digital connectivity is key to going beyond the traditional insurance value proposition.

14% US CONSUMER BREAKDOWN Hunters

Quality Seekers

40%

29%

Percentage of consumers willing to buy insurance from online service providers

38%

Percentage of consumers who would consider peer-to-peer auto insurance

32%

Percentage of consumers who would consider peer-to-peer homeowner’s insurance

46%

Nomads

30%

Percentage of consumers willing to buy insurance from a retailer or supermarket

Source: “Financial Providers: Transforming Distribution Models for the Evolving Consumer,” Accenture, 2017

ONLINE INFO IS OPTIMAL

CONSUMERS ARE ROBO-READY

The share of consumers who prefer to use online channels (including websites, mobile, email, chat/IM and social media) to look for information about insurance has gone up markedly in just three years.

Consumers who look for insurance information online 2013

2016

The vast majority of consumers are willing to receive computer-generated advice about various aspects of their financial affairs – almost three out of four are willing to take this kind of advice on what type of insurance to purchase.

7% Willing

19%

Not willing

Don’t know

5%

8%

17% 24%

74% 78%

54%

68%

Source: “Financial Providers: Transforming Distribution Models for the Evolving Consumer,” Accenture, 2017

4

Insurance

Investment asset allocation

68%

Retirement planning

Source: “Financial Providers: Transforming Distribution Models for the Evolving Consumer,” Accenture, 2017

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How they seek advice 70% 60% 50% 40% 30% 20% 10% 0%

52%

Online

How they seek advice 70% 60% 50% 40% 30% 20% 10% 0%

51%

Agent

How they purchase insurance 70% 60% 50% 40% 30% 20% 10% 0%

51%

Online

How they seek advice 70% 60% 50% 40% 30% 20% 10% 0%

58% 38%

Online

Agent

How they purchase insurance 70% 60% 50% 40% 30% 20% 10% 0%

51%

Agent

Most valuable source of insurance advice 70% 60% 50% 40% 30% 20% 10% 0%

QUALITY SEEKERS

HUNTERS

NOMADS

29%

30%

Online

Agent

70% 60% 50% 40% 30% 20% 10% 0%

40%

Online

Agent

Most valuable source of insurance advice 70% 60% 50% 40% 30% 20% 10% 0%

35%

Online

How they purchase insurance 57%

33%

37%

Online

Agent

62%

Agent 62%

34%

Online

Agent

Most valuable source of insurance advice 70% 60% 50% 40% 30% 20% 10% 0%

42% 25%

Online

Agent

Source: “Financial Providers: Transforming Distribution Models for the Evolving Consumer,” Accenture, 2017

OK WITH P2P

FASTER AND EASIER

Peer-to-peer insurance is increasingly seen as an acceptable alternative to conventional models, especially among younger consumers.

Of those willing to receive computer-generated advice about the type of insurance to purchase, most are swayed by the speed of delivery and greater convenience of online platforms.

50%

Millennials who would consider P2P insurance

Reasons for seeking computer-generated advice 40% 35%

43%

Gen Xers who would consider P2P insurance

30% 25% 20%

Baby Boomers who would consider P2P insurance

32%

15% 10% 5%

Seniors who would consider P2P insurance

27% Source: “Financial Providers: Transforming Distribution Models for the Evolving Consumer,” Accenture, 2017

0%

Think it will be faster and more convenient

Think it will cost less

Think it will be more impartial

Source: “Financial Providers: Transforming Distribution Models for the Evolving Consumer,” Accenture, 2017

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20/01/2017 4:01:03 AM

UPFRONT

HEAD TO HEAD

Does the surge in insurtech activity threaten brokers?

As insurtech moves from the fringes to the mainstream, brokers caught in the oncoming wave are grappling with change

Daniel Schreiber

Donna Peeples Chief customer officer Pypestream

Managing director, commercial intermediary AXA Insurance UK

“Short answer: There’s enough room for everyone. The surge in insurtech is beneficial for those who are underserved by the traditional carriers. These are folks who look to self-serve in every field: They’ll book an Airbnb over a hotel and swipe for an Uber instead of calling a cab. When insurance shopping, they’ll go for a user experience that is instant and hassle-free.

However, there are those who prefer buying insurance from brokers and look to storefront agents to discuss their policy in length before committing to coverage. So while insurtech seeks to accommodate those self-serving customers, it does not threaten brokers.”

“The broker advice model will continue to evolve and has an opportunity to improve with insurtech. Change is here. Insurers are embracing intelligent automation and the use of chat bots to provide 24/7 real-time support in mobile messaging, allowing brokers to focus on higher-level tasks and support.

To redesign the customer experience, brokers and agents must truly understand how their customers and carriers want to engage and what pain-point areas they can make a positive impact on – or what ‘passion points’ can be amplified. It’s about moving from transactions to relationships. Maintaining a human element is always important.”

“Brokers are used to being challenged by advances in the market, especially in the personal lines space. The rise in price comparison sites challenged the position of brokers long before insurtech arrived on the scene.

New technology threatens to do parts of the broker’s job in a much quicker and slicker way, allowing people to buy cover in the same way they would order a taxi from Uber.

Brokers can’t be complacent and must evolve, and should also look at ways of partnering with, or even investing in, insurtech firms to ensure that they stay relevant and safeguard their future.”

Co-founder and CEO Lemonade

Jon Walker

INSURTECH GOES MAINSTREAM One of the key findings of a study released in mid-2016 by PricewaterhouseCoopers was the fact that 74% of insurance companies believe that some part of their business is at risk of disruption. The same study reported that 90% of insurers were afraid of losing some part of their business to new tech initiatives. So where does this leave brokers? In a recent report, global ratings agency S&P Global warned that “traditional insurance brokers’ business model may be considerably altered by technological changes.” While the report posited that the high cost of entry would protect the industry for longer than other financial services fields, insurtech is clearly a tide that won’t be turned back.

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UPFRONT

OPINION

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A match made in heaven?

If the customer experience is the bottom line, then it’s time for the industry to start working with insurtech instead of fighting it, writes Philipp Kristian Diekhöner A GAME DESIGNER, a hipster and a digital nomad meet in a boardroom. No, this is not a joke. Insurers are increasingly bringing customer-experience-focused talent from startups and major tech giants in to work in their newly established digital and innovation functions. In essence, they are building pockets of inspiration into a heritage structure. It’s a two-way street – many insurtech startups are founded by industry veterans that have left their safe, well-paying jobs and are looking to introduce a breath of fresh air into the industry.

The same can be said of startups and corporations. According to a recent report, a large chunk of venture capital funding volume comes from corporate VCs. While these are most likely involved in more late-stage deals, there is an evident trend of corporations getting more involved. Startup accelerators (however critical we may want to be of them) have done much to foster this proximity.

In my view, fintech startups and financial institutions have increasingly come to realize that they benefit more from collaborating than competing. It paves the way to innovative operating approaches, such as institutional license-sharing with startups. In some fintech verticals, the risk exposure that comes with running a financial services business serves as a perfect rationale for forming symbiotic relationships between disruptors and established players. Insurtech is a great example – take Slice and Munich Re, or Lemonade and their liaison with Berkshire Hathaway and Lloyd’s of London.

The more startups explore creating actual financial (especially insurance) products, the more potent and widely prevalent these mutual beneficial partnerships will become.

They can serve as an effective strategy for managing regulation and reaching scale quickly via large existing pools of customers that have already been through KYC.

usually only solving one small wedge of customers’ overall needs. Most of us would need a variety of fintech services provided by different startups to take care of all our financial needs – a great user inconvenience and a tremendous market opportunity, which I believe will be solved by new types of service aggregators for fintech, covering a range of functionality in one digital-native experience and customer proposition.

Life insurers would be in an excellent position to provide such a holistic value proposition, given that wealth management and life insurance both have a mandate to take into consideration a person’s overall financial health. A financial planning one-stopshop would be a very ‘ownable’ territory for them, but it would require incumbents to rethink the nature of their business. If we were to reframe their purpose from being a financially stable and dependable provider of long-term, big-ticket financial products to being a single place for people to take care of their present and future financial health, the industry would future-proof itself in a

“Fintech startups and financial institutions have increasingly come to realize that they benefit more from collaborating than competing” The extent of collaboration occurring at the moment is almost antithetical to what public perception has made of banks in the years after the global financial crisis. Goldman Sachs estimates that globally, financial institutions represent a $5 trillion industry in danger of being disrupted by Fintech companies, so the enthusiasm to collaborate may be driven in part by a well developed survival instinct. Insurance, a vertical within finance that has been a little late to the innovation party, is possibly facing the most fundamental threats and opportunities. According to CB Insights, the insurtech domain attracted in excess of $1 billion in venture capital funding in the first half of 2016 alone.

Perhaps the biggest discrepancy between corporations and startups is that the latter focuses single-mindedly on a specific customer problem, which means they are

highly effective and relevant way. It would involve curating and working proactively with startups that are already providing the individual bits and pieces.

Overall, we should be highly optimistic about present and future interactions between startups and financial institutions, especially in the domain of insurtech. Both sides have a long way to go in terms of assimilating. Tremendous potential awaits progressive entrepreneurs and intrapreneurs who are resourceful and realistic about finding natural connection points that create mutual benefit.

Philipp Kristian Diekhöner is an emerging fintech thought leader in Asia and a preeminent voice in the Singapore startup and innovation ecosystem. His vision is to shape the future of finance through customers’ eyes.

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20/01/2017 4:01:51 AM

UPFRONT

NEWS ANALYSIS

Cyber boom on the horizon As the industry enters what’s predicted to be a benchmark year for cyber insurance, how will the landscape change, and what challenges lie ahead?

THE COMING year looks set to be the biggest one yet for cyber insurance. Just a few days before the new year, Lloyd’s CEO Inga Beale revealed that the London insurance market is bracing for a surge in the sales of cyber policies in 2017, after seeing a 50% rise in sales during 2016. Global firm CFC Underwriting also reported that the number of cyber claims it received had shot up 78% in 2016 compared to the previous year.

But with increasing take-up set against a backdrop of rapidly developing risks, is the market prepared to evolve?

“Cyber insurance will transition into a mainstream product with significantly increased penetration amongst small and mid-market clients, both in the US and internationally,” predicts Graeme

pins the policy wordings,” he says. “We expect to see greater clarity introduced to policy wordings and a shift away from the liability constructs that dominate current forms, toward the constructs found within more traditional crisis management classes like kidnap & ransom, crime and terrorism.”

High-profile cyber attacks were in no short supply over the past 12 months. Tech giant Yahoo had two enormous data losses come to light during the year, and its second reported hack – revealed in December – became the largest known data breach in history after more than a billion user accounts were compromised.

But the archetypal data loss event is just one of the many cyber risks that companies are now facing. Ransomware – malicious

“I don’t think we can say that there’s one industry or another that is more at risk – I think they are all at risk” Michelle Lopilato, HUB International Newman, chief innovation officer at CFC Underwriting.

The focus will shift from cyber being a privacy breach product to a more allencompassing ‘cyber incident response’ solution, he adds.

“There will be a greater focus on incident response and the claims service that under-

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software that allows hackers to block access to a system until a sum of money is paid – is becoming increasingly widespread, and the potential for business interruption to companies of all size is significant.

“It’s one of those types of events that is highly impactful and very successful,” says Michelle Lopilato, SVP and director

of cyber and technology solutions at HUB International.

HUB is seeing at least one ransomware event per month among its clients, Lopilato says, due largely to how easily attainable and inexpensive the software is.

“The availability is somewhat astounding,” she says. “The reality is that because they’re so available and so successful, we are going to see a lot more of these types of ransomware families being developed and used.”

As cyber products respond to these diversifying risks, solutions are likely to become increasingly tailored to both the size and type of business.

“At the SME/MM scale, we will continue to see cyber being incorporated into other products, whereas for larger risks, standalone products that cover all cyber perils are the obvious evolution,” says Alessandro Lezzi, international technology, media and business services team leader at Beazley.

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CYBER INSURANCE BY THE NUMBERS

$20 billion

Projected amount of global written premiums for cyber insurance by 2025

15

Different types of cyber cover introduced

by Lloyd’s in 2016

23,000 to 35,000

There are early signs in the market of a move toward industry specialization, Newman adds, “with a growing recognition that you can’t sell the same cyber insurance product to a bank as you can a hospital

smaller companies are more likely to suffer significantly from a cyber event, even going out of business in some cases.

But in some respects, Lopilato says, companies are on an equal footing: “I don’t

“Cyber insurance will transition into a mainstream product with significantly increased penetration”

The average number of ransomware infections per month in 2015

$209 million

Amount paid to ransomware criminals in the first quarter of 2016 Sources: Allianz, Lloyd’s, Symantec, CNN

Graeme Newman, CFC Underwriting or a school.”

Small and medium-sized businesses represent the biggest growth potential in the purchase of cyber policies, according to Lopilato, who explains that many hackers will target them as “the lowest-hanging fruit.” Without the resources – particularly financial ones – of their larger counterparts,

think we can say that there’s one industry or another that is more at risk – I think they are all at risk.”

So what should brokers and insurers focus on in terms of cyber insurance in the coming year?

“Cyber exposure and the nature of the risks change very rapidly, so the challenge

for the industry is to keep abreast of the changes in order to identify new ways to assess risk,” Lezzi says.

For Newman, the handling of claims is a more pressing issue. “Many insurers have not developed an appropriate internal or external claims infrastructure to support the products they are selling,” he says, “and this should be the biggest area of concern.”

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20/01/2017 5:05:16 AM

UPFRONT

INTELLIGENCE CORPORATE ACQUIRER

TARGET

PRODUCTS COMMENTS

Arthur J. Gallagher & Co.

Group Insurance Associates

Group Insurance Associates provides employee benefits to small and middle-market businesses

Confie

Auto Insurance America

Auto Insurance America specializes in non-standard products

Fairfax Financial

Allied World

Fairfax is set to spend $4.9 billion on the acquisition

HUB International

Mainline Insurance Brokers

HUB will expand its presence in Canada by partnering with Mainline

HUB International

Tevis Insurance Solutions

The deal is expected to expand HUB’s California footprint as part of its broader M&A strategy

Ryan Specialty Group

The Navigators Group

RSG will be present in Sweden and Denmark through Navigators

UnitedHealth Group

Surgical Care Affiliates

UnitedHealth will shell out $2.3 billion in cash and stocks to diversify its business

Olympus Insurance adopts new administration system

Olympus Insurance has adopted a new policy administration system called OICONNECT. The system is a first step in the Florida insurer’s multi-phase technology adoption program designed to benefit policyholders as well as insurance agents.

OICONNECT’s initial phase enables homeowners to file a claim, access policy documents, locate company and agent information, review and pay bills, and set up payment reminders online. OICONNECT is also expected to serve as a more efficient policy processing platform for agents by providing tools to expedite quote and new business applications.

Industry M&A value increased by 176% in 2015

A recent report from analyst Timetric confirms that insurance companies are consolidating to cope with current economic pressures. Published in September 2016, the firm’s Insight Report: M&A in the Global Insurance Industry reveals that deal values jumped 176% between 2014 and 2015, from $74.2 billion to $204.5 billion.

According to Timetric, challenging economic and market conditions are greatly affecting all insurance operators, brokers and service providers. Tepid premium growth and low-performing investments are also pushing firms to take the M&A leap. In addition, the report cited changes in the business environment – including low interest rates, regulatory developments, changing customer preferences, the availability of surplus capital and technological advances – as key drivers of the increased M&A activity.

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Sun Life introduces emergency cover disruptor

Sun Life has launched a new virtual advisor platform, Emerge, that aims to reimagine how consumers buy emergency insurance coverage.

Emerge was designed as a solution to the large medical costs faced by some consumers due to highdeductible health plans. Max, the platform’s virtual advisor, asks customers questions about health, lifestyle and budget before providing a free personal protection plan and risk report with insurance options.

Max is powered by an algorithm that recommends only what users need to cover health insurance gaps.

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PEOPLE Ford app offers discounts for good driving Automaker Ford has launched a smartphone app that connects to its Ford SYNC App Link platform, which gives consumers the option to share driving data and have their behavior rated by participating insurance providers. The app, developed by IVOX, runs in the background without any driver interaction once it has been downloaded and set up. According to a Business Wire report, the app helps track driving patterns of different individuals even if they are using the same vehicle.

One Inc. raises $20 million for its SaaS platform

Insurtech firm One Inc. got a $20 million injection of capital from a Series B funding round to start up its SaaS operating system. This second round builds on the initial $16.7 million raised by the firm. One Inc. provides cloud-based software, both an insurance-specific operating system and applications to support the core functions of insurance carriers and general agencies. President and CEO Christopher W. Ewing told IBA that the company has experienced rapid growth in the past three years – revenue has grown 300% annually, and its subscriber base has quadrupled.

Liberty Mutual launches capital markets platform

Liberty Mutual Insurance has unveiled its Limestone Capital Markets Platform, aimed at leveraging investments in US property catastrophe and homeowner’s risk, as well as London market specialty insurance. The platform has an initial capitalization of $160 million. “This transaction demonstrates investors’ interest in both traditional property catastrophe reinsurance risks, as well as reinsurance risks,” James Slaughter, SVP and director for global reinsurance strategy at Liberty Mutual, said in a statement.

NAME

LEAVING

JOINING

NEW POSITION

John Bissell

Association for Cooperative Operations Research and Development

Chartered Insurance Institute

COO

Rick Christofer

AIG

Vale Insurance Partners

Underwriter

Layla Dodd

State Farm

Nixon & Lindstrom Insurance

Commercial lines CSR

Tom Gallagher

Florida Insurance Commission

People's Trust Insurance Company

CEO

Eric Greenberg

AIG

Vale Insurance Partners

Vice president and senior actuary

Marc Henstridge

N/A

Atradius

Chief insurance operation officer

Helena Meirhino

Zurich North America

Everest

Underwriting manager of wholesale property

Patrick Mulready

AIG

Everest

Vice president of commercial property underwriting

Adam Reed

AIG

Acrisure

General counsel

Sarah Ruef-Lindquist

Maine Women’s Fund

Allen Insurance and Financial

Development professional

Lauren Valencia

Allied World

Everest

Property underwriting manager

Timothy B. Ward

Marsh & McLennan

EPIC Insurance Brokers and Consultants

Principal casualty practice leader

Atradius appoints new chief insurance operation officer

Business-to-business enterprise insurer Atradius has named Marc Henstridge as its new chief insurance operation officer and management board member, following the retirement of Dominique Charpentier.

Henstridge has been working with Atradius since 1997, most recently as director of risk services for the UK and Ireland. In his new capacity, Amsterdam-based Henstridge will be responsible for installment credit protection, bonding, collections, reinsurance, and the project and process unit.

Acrisure taps Adam Reed for general counsel post

Acrisure has announced the appointment of Adam C. Reed to general counsel, following the anticipated retirement of John P. Iacono later this year. Reed’s appointment took effect January 1. The industry veteran has more than 20 years of insurance experience under his belt. Prior to Acrisure, Reed served as general counsel for AIG’s personal insurance business, where his duties covered legal responsibility for multi-billion-dollar operations in the Americas, Europe and Asia.

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20/01/2017 4:03:00 AM

UPFRONT

WORKERS’ COMP UPDATE NEWS BRIEFS New program fills an important gap in the workers’ comp space

In an attempt to cater to the specific needs and unique business profile of large employers, Safety National has launched a new Large Guaranteed Cost Workers’ Compensation program. The program is a 100% risk transfer product aimed at sophisticated large insureds – generally with premiums in excess of $1 million – that are focused on risk management and loss prevention. “We had seen many business opportunities that, due to their ownership structure, business needs or financial condition, required a guaranteed cost program, and we saw an opportunity to expand our offerings to the marketplace through this product,” said Safety National VP Tom Hebson.

Acuity adopts Valen Analytics platform Mutual insurance firm Acuity has announced plans to adopt Valen Analytics’ InsureRight platform for its workers’ compensation business line.

Acuity is a property & casualty insurer with more than $3 billion in managed assets. Its workers’ compensation business represents 31% of its commercial lines and a quarter of its total premium. In its engagement with Valen, Acuity will use the Predict and Manage applications.

Charges laid in workers’ comp crackdown in New York

New York State Inspector General Catherine Leahy Scott announced that three people have been arrested in Jefferson County, New York, and are facing felony charges for alleged workers’ comp fraud. One of those arrested was Ronald Durand, who was seen visiting a local YMCA after he

12

began receiving benefits for an injury in 2013. The other two people arrested were Marleen Ayen and her fiancé, Anthony Hull; Ayen claimed she was not working while receiving benefits but was allegedly employed at a hardware store owned by Hull, who is suspected of not maintaining workers’ comp coverage for his employees.

NCCI highlights states to watch in 2017 In a November report, the National Council on Compensation Insurance named several states to keep an eye on in 2017 in terms of changes in their legal structure of workers’ compensation.

Among the states are Florida, which legalized use of medical marijuana in November’s election, as well as Massachusetts and Nevada, where voters approved recreational marijuana use. NCCI is also monitoring the status of the embattled opt-out workers’ comp program in Oklahoma and tracking moves in Florida to find legislative fixes for the Supreme Court’s ruling that resulted in double-digit workers’ compensation rate increases.

Florida panel recommends revisions to WC laws

According to Florida Politics, an expert panel has asked the state legislature to approve the adoption of a drug formulary to reduce medical costs.

The panel also noted the need to revise procedures in the reimbursement facilities for injured workers, as well as tighten guidelines for the provision of medical care. In addition, State Division of Workers’ Compensation assistant director Andrew Sabolic pointed out the need to address the authorization process for medical treatments and to clarify the definition of carrier response to claims in state laws.

Study compiles claims best practices A recent survey of workers’ comp specialists pinpoints the best ways to handle claims The 2016 edition of the annual Workers’ Compensation Benchmarking Study has revealed a list of claims best practices that resulted in better outcomes for their proponents. This marks the first time the study – which is based on a survey of 492 claims specialists – has pointed out specific practices that have garnered the best results.

According to the report, some of the key characteristics of effective claims practices include: A link between key performance indicators and desired claim outcomes The use of technology-enabled decision support tools, such as analytics, automation and predictive modeling The use of employee-centric and advocacybased service models Delivering healthcare coverage based on value rather than volume Using evidence-based care Judging providers based on pharmacy barometers and reflecting that in contracts with providers The study is a product of Rising Medical Solutions, whose advisory board has worked with more than 1,000 claims specialists to attempt to identify which way the wind is blowing in workers’ compensation, bringing analytics into practical applications for companies to understand where to use their resources, how to overcome challenges and what strategic methods they can use.

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“We’ve heard from the claims community about difficulties identifying which best practices actually move the needle, because industry data is often limited or unavailable,” says Rachel Fikes, vice president and study program director at Rising Medical

organizations are doing compared to industry peers,” adds principal study researcher Denise Zoe Algire. “With so many competing priorities and complexities in claims management, the 2016 study provides a roadmap identifying where orga-

“We were able to contrast how and what higherperforming organizations are doing compared to industry peers” Solutions. “Providing quantitative, primary data to substantiate various methods in claims management was the next logical step in the study’s evolution.”

“By using the industry benchmark of claims closure ratio, which is applicable to all payer sizes and types, we were able to contrast how and what higher-performing

nizations should allocate resources to drive better outcomes.”

The study is operating in a rapidly evolving environment, as Florida’s massive rate hike makes waves and the White House looks at possible new directions on labor laws. Meanwhile, New York Governor Andrew Cuomo pledged he would reform

workers’ compensation in his state, which is among the three most expensive for workers’ compensation. Though efforts are being made to reduce costs, labor groups are opposed to limits on making claims.

The Workers’ Compensation Benchmarking Study could prove to be a useful litmus test in relation to the changing times.

.®

www.summitholdings.com

Member of Great American Insurance Group

Policies are underwritten by Bridgefield Casualty Insurance Company and Bridgefield Employers Insurance Company, authorized insurers in AL, AR, FL, GA, IN, KY, LA, MS, NC, SC, TN and TX; BusinessFirst Insurance Company, authorized in FL, GA, KY, NC, SC and TN. RetailFirst Insurance company, authorized in FL; Retailers Casualty Insurance Company, authorized in AR, LA, MS and TX. ©2016 Summit Consulting LLC | 2310 Commerce Point Drive, Lakeland, FL 33801

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20/01/2017 4:03:51 AM

UPFRONT

TECHNOLOGY UPDATE

Education is key to mainstreaming cyber Insurers say helping clients understand their risk is one of the major hurdles in providing cyber insurance

In 2015, for instance, cybersecurity firm Symantec reported that almost half a billion personal records were stolen or lost – a 23% increase over the figure reported in 2014.

Thus, insurance brokers spend a lot of time and energy helping clients understand that they have a risk, Rosenzweig said. Even the process of applying for coverage is an obstacle, he added, because forms are long, and the application process can be tedious. Usually, he said, it takes three to four attempts before some SMEs can be convinced to get covered for their cyber exposure.

In 2015, cybersecurity firm Symantec reported that almost half a billion personal records were stolen or lost

Education and awareness continue to be the biggest hurdles for insurance firms who want to provide cyber coverage. That was the consensus of the expert panel at the recent Insurance Business Cyber Risk Master Class.

Citing data from the Council of Insurance Agents and Brokers, AHT Insurance president and CEO David Schaefer said that only 29% of the clients of the insurers surveyed are covered by cyber insurance.

Further, Robert Rosenzweig, cyber prac-

NEWS BRIEFS

tice lead for DeWitt Stern’s Risk Strategies Group, noted that it is especially challenging to convince small and medium-sized enterprises [SMEs] that their cyber risk may be greater because they do not have dedicated personnel to respond to a crisis. The situation is exacerbated by mounting cyber threats that are trickling down from the large national accounts to the smallest mom-and-pop stores as a result of the increasing use of computers in business operations.

Japanese firm replaces claims workers with AI

A Japanese insurance firm has announced that it is replacing human workers with IBM computers to save on costs and improve productivity. Fukoku Mutual Life Insurance plans to replace 34 claims workers with the IBM Watson Explorer. An online report from Quartz said the move will cost the firm nearly $2 million to install the artificial intelligence system and $128,000 for annual maintenance. However, the company expects to realize $1.1 million in savings per year on employee salaries and a 30% improvement on productivity.

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Christine Marciano, president of Cyber Risk Data Managers, emphasized that comparison shopping can be an intimidating process for a client because of the sheer diversity and variety of coverages available in the market. Shopping around based on premiums is not as simple as it seems, she said, because of the variations in wordings, conditions and exclusions that clients may discover on their quotes.

This hurdle needs to be addressed with further education, Rosenzweig noted, as brokers must help their clients understand how cyber risk is being priced.

Evolving consumer preferences push insurance innovation

Technology has changed customer expectations, and insurance firms need to adapt to remain relevant, according to Ali Safavi, director of insurance for the Plug and Play Tech Center. Safavi said insurance firms can benefit from technology adoption in the areas of customer experience, risk assessment and underwriting, loss prevention, and cost reduction. He also highlighted how insurance companies can capitalize on opportunities to improve systems and processes by partnering with technology startups.

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Q&A

Robert N. Hermes Partner and co-chair, reinsurance litigation and arbitration practice group BUTLER RUBIN SALTARELLI & BOYD

Years in the industry 30+ Fast fact The world’s first selfdriving taxis picked up passengers in Singapore in August of last year

Driverless cars will lead to greater product liability What are your thoughts on liability for selfdriving cars? Should manufacturers be held responsible for their products?

American manufacturers have long been held ‘strictly liable’ for defective products that cause harm to the purchaser or others while being used as intended.

Driverless cars are intended to operate collision-free without human intervention. As a result, if they collide, one or more of the cars involved in the accident must have been defective.

What is the greatest risk you see when self-driving cars become more common?

Hacking. Autonomous cars will be run by computers that will be an attractive target for hackers.

How do you think driverless cars will affect the dynamics of auto insurance?

Risk, and therefore premium dollars, will shift away from automobile liability insurance since driver negligence will be virtually eliminated. However, car manufacturers will face increased product liability exposure and can be expected to purchase increased or additional coverage.

Auto insurers will also face significant changes in underwriting. Typical automobile insurance is underwritten autonomously using formulas that assess risk based on a driver’s age, driving history and location.

Driverless cars, however, are not influenced by driver risk. As a result, underwriting decisions will shift from a computer assessment to an analytical assessment

More insurers turn to virtual assistants for customer service

A third insurer has launched on Amazon’s voice-activated virtual assistant service Alexa, while another has introduced its own high-tech customer service operative. Grange Insurance, headquartered has joined Liberty Mutual and Nationwide, by adding a ‘skill’ to the 7,000 now available to Alexa users.

Meanwhile, GEICO has added a virtual assistant of its own to its mobile app.

Customers can ask ‘Kate’ a question and she will respond with quick, personalized answers paired with insurance knowledge.

made by an experienced underwriter.

Given that there is no historical data yet on which to base risk models, what will insurance policies for these cars look like?

Drivers will no longer require liability insurance unless states require a type of ‘no fault’ insurance for car owners. It is also likely that specific product liability coverages will be developed. Commercial product liability coverages will exclude automobile claims, which will require the manufacturers of driverless cars to purchase separate coverage, which will be underwritten based on an assessment of their technology, market share and quality control in manufacturing.

When do you think autonomous vehicles will reach a tipping point?

Less than 10 years. The US Transportation Department has proposed requiring all new cars to have ‘talk to each other’ technology. The proposal calls for 50% of new vehicles to have the technology within two years and 100% within four years.

How can insurers prepare for this eventuality?

Carriers need to engage state regulators in a dialogue about the types of coverage that will be required for owners, manufacturers and sellers of self-driving cars.

Each state must decide for itself who must purchase insurance and what limits of liability are appropriate.

Lemonade announces plans to expand in 2017

Startup peer-to-peer insurance company Lemonade has filed for licenses in 46 states and the District of Columbia in a bid to make its products and services available to 97% of the US population in 2017. In a statement, Lemonade said it made nationwide expansion a top priority after receiving tens of thousands of applications since its September debut in New York. The insurance disruptor plans to file for licenses in the three remaining states − Mississippi, Washington and Wyoming − once it has met their strict statutory waiting times.

Hippo secures $14 million to fund launch

Silicon Valley-based Hippo, a provider of smart home insurance, has raised $14 million to support its official launch in 2017. The funding was headed by venture capital firm Horizon Ventures and participated in by several other venture capital firms, fintech investors and entrepreneurs. According to Assaf Wand, Hippo CEO: “We took everything that’s wrong with the current state of home insurance – the confusing forms, the outdated policy terms, the agent as middleman – and fixed it.”

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20/01/2017 4:04:22 AM

PEOPLE

INDUSTRY ICON

INSURANCE’S NEXT FRONTIER Lockton Companies’ cyber guru, Ben Beeson, discusses the challenges facing the industry today in its efforts to deal with the most talked-about emerging threat

IN 2013, Ben Beeson was relaxing on vacation in France when he received a phone call from Lockton Companies’ head office in Kansas City.

“They wanted me to go to Washington, DC, for a meeting at the White House within two days,” he recalls. “And I thought, ‘This doesn’t sound right. It must be a joke!’ Within 48 hours, I was sitting with other industry leaders in front of one of the president’s lead advisors on cybersecurity and a number of lead agencies representing the insurance industry. The federal government basically wanted to engage us in helping to roll out the NIST [National Institute of Standards and Technology] Cyber Security Framework, which they had devised to help US businesses understand the risk and how to deal with it.”

Beeson is Lockton’s US cyber risk practice leader, a role he took on in January of last year. But his involvement in the cyber risk space dates back to 1999, following a career in London’s reinsurance market.

Beeson joined Lockton in 2007, just after the company made the decision to become a global broker, and Beeson and his colleague, Emily Freeman, founded Lockton’s cyber risk practice in London.

“Working with leading underwriters in Lloyd’s, we built a platform that provided both client advisory and placement services to our global clients and became the leading team in the London market,” Beeson says.

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Beeson’s extensive experience in the realm of cyber insurance has even given him the opportunity to testify before Congress in March 2015, about the evolution of the cyber insurance market. He calls it one of his proudest achievements in the cyber space to date.

“That was a great moment, having made the decision to relocate to our Washington, DC, office in 2014 and only been in the US a year, to be asked to do that,” he says.

“And what resonated with me at that point

“The good news is, the awareness is much better than it was, say, two years ago, particularly at the board and executive level,” Beeson says. “I think that, generally speaking, businesses understand there is a risk.”

However, he says, there remains a lack of understanding as to the best way to deal with the threat.

“That’s because the issue has traditionally been owned by the IT department, the technical people who are invested in the

“The good news is [that] the awareness is much better than it was, say, two years ago, particularly at the board and executive level.

I think that, generally speaking, businesses understand there is a risk” was what a great opportunity we have, as an industry, on this risk issue. We mustn’t lose that, and [we] have to capitalize on that if lawmakers are giving us that type of attention.”

Increased awareness After years of high-profile cyber attacks, there’s no doubt that the business world has a greater appreciation of cyber risk in 2017.

box of tools – the firewalls [and] the antivirus software – to keep the problem at bay,” Beeson says. “That approach no longer works because prevention is very difficult, and so you have to build resilience across the organization because you should expect you are going to get hit, no matter how much you try to mitigate.”

He says building that resilience requires ensuring that the effort extends right across

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PROFILE Name: Ben Beeson Company: Lockton Companies Title: Senior vice-president and US cyber risk practice leader Fast fact: Beeson was named Advisen Cyber Risk Champion of the Year in 2016 and has served as a media commentator on cybersecurity issues on CNN and Fox News, as well as for the Financial Times, Thomson Reuters and the Huffington Post.

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PEOPLE

INDUSTRY ICON

the organization.

“It includes the people you hire, what access you give them to what information, and how you engage with third-party vendors who deal with your organization.

And that all requires a strategy that comes from the top of the firm, starting in the boardroom.”

Beeson says far too many companies misinterpret cyber as a risk that only involves their handling of individuals’ personal information.

“They view it first and foremost, and maybe only, as a privacy issue – the liability to the company from handling customer

Keeping pace with change As quickly as the business community is becoming aware of the nuances of cyber risk, the threats are evolving at an even faster rate.

“It’s growing as rapidly as technology advances, so very fast,” Beeson says. “The bad guys are still ahead of the good guys. That’s the problem – we’re still playing catch-up with the bad guys, because the economics are much easier for the bad guys than the good guys. The bad guys only have to succeed once, essentially. We’re continually investing in mitigation, playing catch-up, to keep every attack at bay. The economics dictate that it’s

“The bad guys are still ahead of the good guys. That’s the problem – we’re still playing catch-up with the bad guys, because the economics are much easier for the bad guys than the good guys” data or employee personal data or their healthcare information,” Beeson says. “Of course, that’s a big risk, and that’s certainly where the insurance industry has been focused for the last 15 or 16 years, but it’s way broader than that now, and it’s only just being understood that it’s broader.”

Beeson raises the theft of a company’s intellectual property and cyber espionage as key examples of cyber risk unrelated to personal information. “[Cyber] is not a product; it’s a peril, and it’s a peril that can have lots of different types of consequences. We have to start talking much more broadly about cyber risk as a peril that can have different consequences, depending on who the buyer is, and change that perception of it only being something that we’re focused on as a privacy issue.”

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much harder to do that.”

While the insurance industry offers products that provide breach response services, Beeson says there’s substantial work to be done with respect to the pre-breach side – the time before things go wrong.

“Most companies right now are really struggling, for example, to understand how to identify the critical assets they want to protect,” he says. “How do they quantify the risk to those assets? How do they understand what the ROI is on mitigation to those assets, and whether they should or should not buy cyber insurance and how much should they buy?

“Those questions, we as an industry right now are trying to work on and help clients answer,” he adds, “but we haven’t solved that yet, and it’s incumbent upon us to come up with those answers.”

LOCKTON COMPANIES

BY THE NUMBERS

F 2

1966

The year Lockton Companies was founded

$1.24 billion

Total revenue Lockton Companies achieved in 2015

6,000+

Number of associates employed by Lockton Companies worldwide

125

Number of countries with clients served by Lockton Companies

B B in e

T t o e

F t e a

R s

V

68

Number of offices Lockton Companies has across the globe

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Flood Risk 2017 delivers the latest discussions of flood and connects more than 100 brokers, insurers, risk managers and other key stakeholders to explore how the flood insurance market is rapidly evolving to manage all aspects of flood risk.

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19/01/2017 20/01/2017 10:24:04 4:05:02 PM AM

FEATURES

COVER STORY: AGENTS ON NETWORKS

AGENTS ON NETWORKS Hundreds of agents had their say, and the results are in.

So how do agents think networks are performing in key areas – and which network benefits are most important to them?

MANY SMALLER agencies have jumped at the opportunity to join a network and enjoy benefits that would otherwise be out of reach. For others, the perceived risk of losing independence is enough to keep them at bay.

Insurance Business America wanted to know more about why thousands of agencies have – or have not – chosen to join a network or alliance. In this in-depth look at networks and alliances, we examine which network benefits are most important to agents, as well as the top reasons many agencies have chosen not to join a network.

We surveyed hundreds of agents across the country to uncover what they believe to be the most important benefits of a network. For those who were already network members, we asked them to rate the importance of 10 key benefits offered by networks on a scale of 1 (not important) to

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10 (very important). Non-members, meanwhile, were asked what factors have prevented them from joining a network, and which of the same 10 benefits would be most important to them if they were to join.

Finally, we surveyed the members of networks to find out which groups were performing above the rest by asking them to rate their network’s performance in each of those 10 benefit areas on a scale of 1 (poor) to 10 (excellent). If a network scored 80% or better in the category, we awarded them our five-star rating for excellent service.

So how did networks perform? Nine networks garnered a five-star rating in at least one category, while two received five-star marks across the board. Did your network come out on top? And what did agents have to say about the benefits offered by networks? Read on to find out.

WHAT IS A NETWORK OR ALLIANCE? A network or alliance is a group of agencies that operate under one master agency code. Because of their breadth, networks give individual agencies access to more insurance companies, products and contacts, allowing them to expand their business.

Carriers now recognize networks, and most now offer sub codes to member agencies of a network. In return, the agencies share profits with the network or alliance in the form of percentages of commission, monthly fees or both.

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20/01/2017 7:38:17 AM

FIVE STAR NETWORKS 2017

WHAT ARE THE TOP BENEFITS OF BEING PART OF A NETWORK OR ALLIANCE?

HOW WELL DID NETWORKS PERFORM?

Commissions and profit-sharing

Commissions and profit-sharing

9.48 Access to insurance companies and products

9.31 Access to niche and nontraditional markets

8.22 Overall business consulting

7.42 Training and education

7.34 Marketing

7.03 Administrative support

6.65 Claims support

6.59 Customer service support

6.54 Talent recruitment

6.10

8.60 Access to insurance companies and products

8.62 Access to niche and nontraditional markets

8.07 Overall business consulting

7.65 Training and education

7.99 Marketing

7.34 Administrative support

6.97 Claims support

6.51 Customer service support

7.68 Talent recruitment

6.26

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20/01/2017 7:38:32 AM

FEATURES

COVER STORY: AGENTS ON NETWORKS WHAT THE NETWORKS HAD TO SAY “It has become very challenging for an agent to keep up with the continual changes in our industry – new and updated policy forms, up-and-down market conditions, and the changes made to each carrier’s underwriting appetite.

A network takes on the responsibility to stay current and educate the agent to help them successfully write and retain business without being overwhelmed by the influx of information on carrier and market changes.”

Matt Amack President and CEO Insurance Producers Network

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“One of the emerging benefits I see taking shape for agents is the need for support.

Agents need a place to go for advice, information and training. Many seek advice and support that is specific to their situation, from someone who knows them and understands their circumstances and can stand with them through the process. This support is a valuable benefit the network provides.”

“As companies continue to lower commissions and place higher volume requirements on agents, being part of a network gives protection to agencies who partner with us. One of the primary benefits of an agency network is the power of the group – partner agencies have security from the network, plus access to other discounted products like E&O, management systems, comparative raters, continuing education, office supplies, etc.”

Scott Smith Vice president Networked Insurance Agents

Paul Taylor Executive vice president Smart Choice

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FIVE STAR NETWORKS 2017

HOW HAVE AGENT PRIORITIES CHANGED?

HOW HAS NETWORK PERFORMANCE CHANGED?

10

10 2015

2016

2015

9

9

8

8

2016

7

7

6

6

5

5 Commissions Access to Access to and profitinsurance niche and sharing companies and nontraditional products markets

Overall business consulting

Training and education

Marketing

Administrative support

Claims support

Customer service support

Talent recruitment

Access to Commissions Access to insurance and profitniche and companies sharing nontraditional and products markets

Training and education

Customer service support

Overall business consulting

Marketing

Administrative support

Claims support

Talent recruitment

Find out why agents and carriers alike call our contract “THE BEST!” ● 100% Ownership of Your Book ● Keep Your Agency Identity ● Best Commission Split in the Industry ● Best Split on Bonuses & Contingencies ● Commission Split CAP of $1,000 ● No Non-Competes

● No Long Term Contracts ● No Large Up Front Fees ● Affordable Rater & Management System ● Direct Appointments with Top Carriers ● Commercial Lines Training and Support ● CSR Support Available

Wh Let’s m

Call (952) 381- 4048 or visit our website at www.insuranceproducersnetwork.com

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FEATURES

COVER STORY: AGENTS ON NETWORKS ALL-STAR NETWORKS These two networks got top marks from their members across the board, earning a five-star rating in each category.

Insurance Producers Network Valley Insurance Agency Alliance

WHAT DO AGENTS WANT FROM THEIR NETWORKS? “More one-on-one face time” “Protect us better from companies when they threaten to take away our contracts because of a lack of business” “I feel like our group could do better at training us and helping us get the appointments to grow commercial business” “Ask preferred carriers for better/special premium pricing negotiation for members”

“Special niche programs/exclusive programs and reduced monthly premiums, or make all offices pay the same monthly premium” “More localized meetings between group members” “Access to all markets that are part of the network, not just some” “A dedicated loss control department within our group available for all to use”

FIVE-STAR NETWORKS NETWORK

ACCESS TO ACCESS TO OVERALL TRAINING COMMISSIONS INSURANCE NICHE AND ADMINISTRATIVE BUSINESS AND PROFITAND MARKETING COMPANIES AND NONTRADITIONAL SUPPORT CONSULTING EDUCATION SHARING PRODUCTS MARKETS

CLAIMS SUPPORT

CUSTOMER TALENT SERVICE RECRUITMENT SUPPORT

Agency Network Exchange Agents United Insurance Producers Network Iroquois The ISU Group Secure Risk SIAA Smart Choice Valley Insurance Agency Alliance

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20/01/2017 7:39:09 AM

FIVE STAR NETWORKS 2017

COMMISSIONS AND PROFIT-SHARING

ACCESS TO INSURANCE COMPANIES AND PRODUCTS

FIVE-STAR NETWORKS

FIVE-STAR NETWORKS Agency Network Exchange

Agency Network Exchange Insurance Producers Network Iroquois Group ISU Secure Risk SIAA Valley Insurance Agency Alliance

Agents United Insurance Producers Network Iroquois Group ISU Secure Risk SIAA

It should come to no surprise that commissions and profit-sharing ranked highest among network members as the most important benefit a network can offer – as one respondent put it, “it all comes down to the bottom line.” The direct connection between commissions and an agency’s ability to remain in operation struck a chord with several agents, who noted that fair commissions and profit-sharing are the backbone of their business.

AGENTS SPEAK OUT

“We qualify for higher commissions and bonuses [as a network member] than we would get on our own” Overall, it appears that members are satisfied with their network’s commission and profit-sharing standards. Agents gave networks an average score of 8.60, calling their networks’ models “the best” and “top-notch.” Several noted that the commissions they receive as part of a group are better than what they would get if they operated independently, especially for smaller agencies. “We qualify for higher commissions and bonuses [as a network member] than we would get on our own,” said one respondent.

However, not all agents were satisfied with their piece of the pie. “I sell more but make less,” said one disgruntled agent. “Commissions are just OK and could be better,” said another, whose thoughts were echoed by several other respondents who believed there is certainly room for improvement in this area.

Smart Choice Valley Insurance Agency Alliance “This is the primary reason for network membership,” said one agent, which sums up the general response we received from our survey. For many agents, greater access to insurance companies and products was the leading reason they decided to join a network. Even though the category came in second to commissions in terms of importance, it was just shy of being the primary benefit for agents, scoring a 9.31 out of 10. This was also networks’ best-performing area, earning an average score of 8.62, and all nine networks received a five-star rating.

Generally, agents were positive about their network’s carrier portfolio.

Similar to commissions and profit-sharing, many agents agreed that the range of carriers they have access to as part of a network is far greater than what they would have on their own. “I need access to preferred carriers in addition to my base of non-admitted, and would have difficulty obtaining them on my own,” said one respondent. “I prefer to use my time concentrating on finding the best for my clients, and not finding clients to fill the demands of my carriers.”

One agent commended his network’s approach to the agency-carrier relationship: “We recently lost one of our major carriers. We joined Valley Insurance Agency Alliance after considering all of the options for our business. VIAA allowed us to have a relationship with numerous other carriers without demanding production. It is a unique way to determine what works best for your agency in the future.”

All in all, access to a wide range of carriers enables agencies to place more accounts and gives them the freedom to focus on sales. “Without an alliance, it would be tough to offer multiple carriers,” one respondent said. “Having access to more carriers makes me stronger as a company in my market area.”

Importance to members

Network performance

Importance to members

Network performance

1st

2nd

2nd

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20/01/2017 7:39:22 AM

FEATURES

COVER STORY: AGENTS ON NETWORKS ACCESS TO NICHE AND NONTRADITIONAL MARKETS

OVERALL BUSINESS CONSULTING FIVE-STAR NETWORKS

FIVE-STAR NETWORKS

Agency Network Exchange

Agency Network Exchange

Insurance Producers Network

Agents United

Iroquois Group

Insurance Producers Network

Secure Risk

Iroquois Group

SIAA

The ISU Group

Valley Insurance Agency Alliance

Secure Risk SIAA Valley Insurance Agency Alliance Similar to previous years’ results, networks’ access to niche and nontraditional markets came in third in terms of both importance and performance, though the ratings have gone up slightly on both counts. When asked what compelled her to join a network, Beth DeLaForest, president at Aspire Insurance Group, said, “Access to more markets and relationship management with companies so I can do what I am best at – sell!”

For member agencies, having access to niche markets can allow them to meet clients’ needs and maintain their position in a perpetually competitive market. “I never want to tell a client that I can’t assist them with their insurance,” said one respondent. Another pointed out that “issues/needs arise sporadically, [and] you’ll need to access a market that you don’t normally do business with” – and missing out on an opportunity like this could set a company back significantly.

Other respondents said that with all the choices available out there, clients need to know that there are agencies willing to go the extra mile to help them find the right fit – particularly independent agencies, whose “customers routinely require [them] to have markets outside the norm.” In fact, some agents reported having a greater proportion of clients with nontraditional insurance needs.

Another key reason why agencies value this access is to avoid certain restrictions such as volume requirements or types of risks.

For one respondent, having access provides them “better opportunity to help [current] and future clients without a carrier breathing down my neck for more.” Another said it gives his agency the “ability to write risks with no direct contracts due to premium restraints,” especially as “direct contracts demand too much volume upfront.”

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The sharing of ideas and information can be mutually beneficial for agencies and networks alike – and accordingly, agents rated business consulting fourth out of the 10 benefits networks offer. Network performance, however, was middling: Networks averaged a score of 7.65, and only six networks earned five-star status. Respondents were spilt between those who valued their network’s consultation versus those who have never used these services or weren’t aware they were available.

AGENTS SPEAK OUT

“Business consulting helps us compete with larger agencies” “Being able to learn from people who have been in the business for years is invaluable,” one agent said. “We are a small agency, and [business consulting] helps us compete with larger agencies,” said another. One respondent suggested that without a consistent flow of information and advice, there would be little benefit to being a network member: “Being profitable goes beyond writing business.

How to run a business and strategies/consulting advice can be used to help grow profitability.”

While member agencies who did take advantage of a network’s consulting offerings were generally pleased with the service provided, there where several respondents who simply didn’t see the value in this benefit. “I got into agency ownership, as I am sure most did, because I had a vision of what my agency was going to be and how to get there,” one respondent said. “My plan was to become a part of a network not to learn how to start and grow my agency, but instead to utilize the tools, relationships, access to carriers and group buying power to most effectively start and grow my agency.”

Importance to members

Network performance

Importance to members

Network performance

3rd

3rd

4th

6th

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20/01/2017 7:39:41 AM

FIVE STAR NETWORKS 2017

TRAINING AND EDUCATION

MARKETING

FIVE-STAR NETWORKS

FIVE-STAR NETWORKS

Agency Network Exchange

Insurance Producers Network

Insurance Producers Network

Secure Risk

Iroquois Group

SIAA

Secure Risk

Valley Insurance Agency Alliance

SIAA Valley Insurance Agency Alliance Although not a top priority for network members, training and education is still pretty important, and networks are clearly putting some emphasis on it as well – this particular benefit ranked fourth in terms of network performance.

Many respondents were quick to point out that continuous learning is crucial to keeping them relevant. One respondent expressed the need to “stay on top of what clients have in their portfolio of coverages,” while another said that in light of how “products and procedures continue to change, it is important that we have the necessary training.”

Marketing dropped from fourth to sixth place in importance this year, earning a rating of 7.03 compared to last year’s 7.27. The network performance rating went up from 6.85 to 7.34, although it fell behind customer service support in ranking, landing in seventh place.

Most agencies consider the marketing services offered by networks to be something good to have but not absolutely necessary, as they mostly do their own marketing and rely extensively on referrals to attract new clients. As one respondent put it, “the national marketing [provided by networks] is good for name recognition,” but that’s about all. Another explained that “the agency can do the best at marketing, since each area is different,” and it’s the agency’s job to be well acquainted with the specific needs in its area.

AGENTS SPEAK OUT

AGENTS SPEAK OUT

“The national marketing provided “Education for staff gets expensive, by networks is good for name so it’s awesome when the network recognition” provides it at a discount” However, other agencies look to their network for marketing ideas On that note, one respondent stressed that some companies still need to be reminded of how valuable education is: “I think training and education is important because we are responsible for the protection of our clients’ livelihood. Just like I want my family doctor to be very knowledgeable about protecting my family, I would want an agent to be knowledgeable about how to protect my assets.”

As with most benefits, the large-scale nature of networks generally leads to lower costs (and better prices) for training programs. Although agencies are keen to educate their employees, one agent admitted that “education for staff gets expensive, so it’s awesome when the network provides it at a discount.” Another praised networks for providing a ‘neutral’ space for agents to receive training: “The carriers hold [network-]specific training for both product and sales, to which we can comfortably send producers without fear of piracy.”

Importance to members

5th

Network performance

4th

and support. One respondent said his network “offer[s] tools to facilitate a better marketing plan once we have time and money to allocate for this purpose.” Another respondent said his network doesn’t provide direct marketing assistance, but does support agencies in their own endeavors: “Our network encourages us to reach out to the carriers for access to their free or reduced marketing opportunities.”

AGENTS SPEAK OUT

“The agency can do the best at marketing since each area is different” Importance to members

6th

Network performance

7th www.ibamag.com

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20/01/2017 7:39:52 AM

FEATURES

COVER STORY: AGENTS ON NETWORKS ADMINISTRATIVE SUPPORT

CLAIMS SUPPORT

FIVE-STAR NETWORKS

FIVE-STAR NETWORKS

Insurance Producers Network

Insurance Producers Network

Iroquois Group

SIAA

SIAA

Valley Insurance Agency Alliance

Valley Insurance Agency Alliance Reviews on the benefit of network-based administrative support were mixed: About half of agents found it positive, while the rest were either neutral or deemed it unnecessary. This particular service retained the same rankings it had last year in both level of importance (seventh) and network performance (eighth).

Small agencies with only a handful of staff definitely appreciate getting administrative support from their network so they can focus on sales and growing the company. “[The network’s] administrative support is invaluable; otherwise, [administrative support] would be nonexistent for our agency,” said one respondent at a two-person agency. Another said having the support “is huge to ensure that a startup agency can grow without spreading themselves too thin.”

Some companies also look to a network for management advice and leads: “[Our network] provides guidance on choosing a management system that fits our agency,” said one respondent. “With their backing, I am confident that companies would be responsive.” Another respondent admitted that “selling a policy is easy, [but] learning how to manage your books and finances is not so easy.”

Similar to last year’s survey, claims support was one of the least important network benefits for agents, and the networks’ performance reflected a similar weakness. The average performance score came in ninth overall at 6.51, and just three networks earned a five-star rating.

The spilt between agents’ preferences was most stark for claims support than in any other area. “This is when a client sees value for what they paid for. Having exceptional support is a must,” said one agent, who scored claims support at a 10 for importance. By contrast, the agents who scored the category below 5 for importance mostly agreed that the benefit falls outside the purview of a network.

Several respondents expressed the opinion that a carrier’s involvement in claims is more important than a network’s. “The agency should AGENTS SPEAK OUT

“This is when a client sees value for what they paid for. Having exceptional support is a must”

AGENTS SPEAK OUT

“Selling a policy is easy, but learning how to manage your books and finances is not so easy” Others are looking for support to improve efficiency. “[It is] extremely convenient to send license renewals, etc. to one department and [have that] updated for all my carriers,” one respondent said.

Still, a number of agents weren’t particularly concerned with this service. One suggested that networks “are not designed for such [tasks],” while another claimed that they have “never had support from administration, as they don’t support [but] make excuses” – a warning for networks to not completely forgo offering administrative support.

Importance to members

7th 28

Network performance

8th

be able to handle [claims] on their own,” said one respondent. “Our network does not work with or consult on claims,” said another. “We work directly with carriers and the claims adjuster.”

However, not all agents felt the same way. Many believe that although claims support is not always required of a network, having the option available when needed is highly important. “Having a helpful hand to solve problems on claims is nice to have,” said one respondent. And many of the agents we surveyed agreed that how claims are handled reflects directly on the agency – good or bad.

AGENTS SPEAK OUT

“The agency should be able to handle claims on their own” Importance to members

8th

Network performance

9th

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20/01/2017 7:40:01 AM

FIVE STAR NETWORKS 2017

CUSTOMER SERVICE SUPPORT

TALENT RECRUITMENT

FIVE-STAR NETWORKS

FIVE-STAR NETWORKS

Insurance Producers Network

Insurance Producers Network

Iroquois Group

Valley Insurance Agency Alliance

SIAA Smart Choice Valley Insurance Agency Alliance Customer service support dropped from eighth to ninth this year in terms of agent priorities, but the networks jumped from seventh to fifth in performance. Five networks received a five-star rating in the category – that’s more than double the total from last year, when only two networks made the grade.

There was no argument among respondents about the importance of great customer service, but as with claims support, most agents felt that customer service falls more to individual agencies than a network. “I like to handle most of my customer service – it gives me the opportunity to build our relationship and get referrals,” one agent explained. “Most, if not all, of our customer service is handled at the agency level,” said another.

AGENTS SPEAK OUT

“I like to handle most of my customer service – it gives me the opportunity to build our relationship and get referrals” On the flip side, some agents said they appreciate the extra customer service help from their networks. “[It’s] good to have a support staff in place where we can get short-term assistance when needed,” said one. “It’s very helpful to tap into the support of the network for customer service,” said another.

Again, as with claims support, there were several agents who were unaware of the customer support services offered by their networks. Many of these agents agreed that customer service should be handled by the agency, although a couple voiced interest in this benefit.

Importance to members

9th

Recruiting new talent into the industry is one of the biggest challenges facing insurance today. Despite the struggle many agencies face in bringing in new blood, survey respondents rated talent recruitment the least important benefit they receive from their network. Network performance was on par with agent expectations; overall, networks scored an average 6.26, and only two networks received a five-star rating in the category.

Despite several glowing reviews of some networks’ talent recruitment benefits, most of our survey participants said they either choose not to enlist their network’s help with talent recruitment or simply didn’t know this benefit existed.

AGENTS SPEAK OUT

“They have helped me interview potential staff ... and have referred people who they feel might fit the need I have” However, others believed that having their network’s involvement in talent recruitment can be beneficial. One respondent noted how hiring from a single pool of potential candidates may be beneficial to all agencies in the network: “Maybe someone applies to a partner agency but isn’t a fit, but would be for us,” he suggested. Another agent commended his network’s help in the often tedious recruitment process: “SIAA has sample applications and interview questions that are a big help when we are hiring.”

One respondent noted that his network had helped coordinate the interview process and even passed along candidates for job openings: “They have helped me interview potential staff, have given ideas and suggestions, and have referred people who they feel might fit the need I have.” Similarly, another agent noted how his network went beyond recruiting by taking up the reins of the entire hiring process: “[Our network] takes care of hiring customer service people, and if you want one designated to you, they will do that for you. They even handle all the workers’ comp, etc.”

Network performance

Importance to members

Network performance

5th

10th

10th www.ibamag.com

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20/01/2017 7:40:14 AM

FEATURES

COVER STORY: AGENTS ON NETWORKS WHY DO SOME AGENCIES AVOID NETWORKS? Nearly half of non-member respondents cited loss of independence as their main reason for avoiding network membership. Cost/loss of commissions and negative past experience rounded out the top three reasons non-members gave when asked why they hadn’t signed up with a network or alliance.

A couple of respondents provided reasons of their own. One was under the impression that “typically, most carriers represented within networks are out-of-touch national carriers.”

Meanwhile, another said his agency is “satisfied

granting “potential access to carriers that wouldn’t normally give us a contract.”

However, even with networks’ many enticing benefits, most non-members maintained that staying independent was their top priority.

“As long as I continue to keep my stable of companies with our business production, I will remain independent from any alliance or network,” said David Murray, president of Maple City Insurance Associates. “I have always felt [the reason] I became an independent agent was to be different from everyone else.

If I join an alliance or network, I feel I will then lose the one thing that differentiates me from

“I feel that too many networks and agencies are too focused on trying to obtain the next best market. But markets will come more easily if there are high levels of production, and higher levels of production can most easily come through higher levels of productivity” Scott Murphy, Boulder Ridge Insurance Brokers with the access we have with our direct writers and E&S brokers.”

It’s also interesting to note that a number of respondents didn’t provide a specific reason as to why they’re not part of any network or alliance, suggesting that perhaps they feel that there’s nothing particularly compelling about being part of one.

When asked which network benefits they thought were most important, non-members rated commissions and profit-sharing, marketing, and access to insurance companies and products as the top three. Last year’s top-rated benefit among non-members – access to niche markets – came in fourth for importance this year.

Respondents also named a number of other benefits that networks could offer to entice them to join, including providing the latest technology, facilitating easy placement of risks, helping them develop business leads and

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the other agents out there.”

Even satisfied network members have recommendations on how networks can improve their offerings. Scott Murphy, president of Boulder Ridge Insurance Brokers, said the best way a network can continue to benefit its member agencies is through “the continued research and utilization of technologies as it pertains to the operations of an insurance agency.

“With new apps, websites, programs, etc. being created every day that claim to help eliminate wasted time and redundancy, it’s easy to waste a ton of time on the research alone,” he says. “Then to make sure that each product/ program is easy to set up, has support in place, integrates with existing systems within the agency, and that returns outweigh cost … it is enough to make anyone shy away from better efficiency altogether.

“I feel that too many networks and agencies

WHAT COULD ENTICE YOU TO JOIN A NETWORK? 10 9 8 7 6 5 4 3 2 1 0

8.83

8.67

8.67

Commissions and profitsharing

Marketing

Access to insurance companies and products

WHAT’S PREVENTING YOU FROM JOINING A NETWORK OR ALLIANCE? Loss of independence

26.7%

Cost/loss of commissions

20.0%

Negative past experience

20.0%

Other reasons

13.3%

Time commitment

6.7%

Sharing of clients

6.7%

Don’t meet requirements

6.7%

– mine included – are too focused on trying to obtain the next best market,” he continues. “But markets will come more easily if there are high levels of production, and higher levels of production can most easily come through higher levels of productivity. If an agency can be more productive, then they can drive in greater production/premium. If they drive in more premiums, you get access to more carriers. If you get access to more carriers, it becomes easier to close and retain more business. If you are closing and retaining more business, you have more money to invest in the growth of the network.”

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IBAm

FIVE STAR NETWORKS

ARE YOU IN?

2017

Insurance Business America is looking for the producers at the top of their game for this year’s annual showcase. If you have a book of business worth $750,000 or more – you qualify.

Complete your nomination by emailing Heather Turner at heather.turner@ibamag.com or submit online beginning February 8th at IBAMAG.com Top Producers will be profiled in Insurance Business America April 2017 www.ibamag.com

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20/01/2017 8:06:48 AM AM 20/01/2017 4:58:56

FEATURES

SECTOR FOCUS: ENVIRONMENTAL

Toxic exposure Any organization without adequate environmental insurance could potentially face devastating financial consequences. But are American companies aware of their risk exposures?

AS THE WORLD continues to count the cost of climate change and pollution, small business owners across the country are being forced to take steps to prevent and minimize environmental damage. Ten or 15 years ago, an environmentally aware organization with strategies to stop accidents that cause pollution and environmental damage would’ve been seen as an ethical and forward-thinking company, but this is now a base requirement for all organizations – large and small.

“Exposures for small businesses are not that unlike those of a larger business; they pretty much center around implementing appropriate chemical storage practices and having

storage tanks on-site that meet state responsibility requirements,” says Tom Williams, environmental practice leader for North America at Allianz Global Corporate & Specialty.

“Waste disposal activity is also important – that means an organization makes sure they appropriately select landfills based on the categories of waste they’re disposing.”

Doing everything possible to prevent environmental damage and pollution, and implementing policies and guidelines that support those initiatives, is a top priority, and comprehensive environmental insurance policies play an integral role in any organization’s strategy.

The potential financial consequences could

KEY ENVIRONMENTAL EXPOSURES FOR SMALL BUSINESSES

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Storage tanks

Spills to sewers and storm drains

Spills to bodies of water

Pollution liabilities for waste disposed of or transported by third parties

Indoor air quality

Small contractors: EPA’s Lead Renovation, Repair and Painting [RRP] Rule

be catastrophic for an organization that isn’t properly covered.

“Given the potential severity of pollution remediation from a cost perspective, a smaller organization could suffer a more substantial financial loss in relation to their net income than a larger organization,” Williams says. “A small organization may also have difficulty maintaining cash flow if business interruption is caused by a pollution incident.

“Most small companies do not have an individual whose sole responsibility is staying current with environmental regulations,” he adds, “and they likely do not spend money to hire outside consultants until a pollution incident has already occurred. That strategy can result in fines or penalties.”

Growing awareness According to David Dybdahl, president of the American Risk Management Resources Network, growing public awareness is adding to the need for environmental coverage. “The general public in the US is much more aware of the human impact on the environment than it has ever been,” he says. “Ten thousand people camping in North Dakota in the winter to protest a new oil pipeline is a testament of that relative new awareness and concern. This environmental awareness also translates into less tolerance for pollution and ‘polluters.’

Less tolerance translates into more claims for environmental damages in the courts.”

Since 1988, the supply of environmental insurance products has exceeded demand each year. Dybdahl noticed a glut of environmental insurance capacity in 2016, a trend he expects to continue into 2017.

“The constraint in the marketplace that leads to poor market penetration in the environmental insurance product line has always been in the product distribution channel, where insurance producers are not educationally equipped to help their customer base manage environmental risks,” he says. “The reactivation of the Society of Environmental

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Insurance Professionals in 2016, a nonprofit educational organization dedicated to the advancement of knowledge on environmental insurance, and webcasts from multiple providers on environmental insurance and risks hold promise in creating the venues for insurance producers to become more proficient in the coverage line.”

Dybdahl adds that expanding environmental protection laws, combined with a historical surplus of underpriced environmental insurance, are leading to insurance brokers across the country facing professional liability claims that arise from leaving their clients uninsured against pollutionrelated losses.

“In some cases, insurance brokers have their feet being held to the fire for their activities, or lack thereof, 20 years ago, which left their customers uninsured for environmental

“Given the potential severity of pollution remediation from a cost perspective, a smaller organization could suffer a more substantial financial loss in relation to their net income than a larger organization” Tom Williams, Allianz Global Corporate & Specialty losses today,” he says. “The effects of pollution exclusions can be erased by simply purchasing full prior acts EIL coverage today.”

Although there is an increased awareness around the potential for liabilities, David Brereton, vice president and EIL program manager at Freberg Environmental, does not always see that recognition translate into a

perceived need for coverage.

“Because pollution insurance is a discretionary purchase, oftentimes a small business owner needs to be involved in a pollution loss or to at least hear the horror stories before they’ll call their agent,” he says. “More frequently, contractual requirements drive the need for coverage – a lease condition

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20/01/2017 7:34:53 AM

IBA JULY

FEATURES

SECTOR FOCUS: ENVIRONMENTAL

ENVIRONMENTAL INSURANCE: QUICK FACTS The frequency of environmental claims is rising by 20% to 30% each year There are 40 carriers in the marketplace with more than $600 million in capacity ENVIRONMENTAL INSURANCE 2016 RATES Contractor’s pollution liability -10% to flat Site pollution liability (PLL/EIL) -10% to flat Combined environmental and casualty/professional +10% to +25 INDUSTRIES WITH THE HIGHEST NUMBER OF SITE-SPECIFIC CLAIMS

Gas/service station 68% Commercial 13% Miscellaneous 9% Residential/apartment 4% Airport 4% Municipality 1% Marina 1%

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or a client’s contractual requirement. To a greater extent, pollution insurance is being seen as a sensible discretionary buy that’s very affordable. The question becomes not whether you can afford it, but whether you can afford not to buy.”

The broker’s role In order to guide their clients toward the best and most appropriate environmental products, Brereton advises agents and brokers to take the time to really get to know their clients’ unique wants and needs.

“Through that process, they come to understand the exposures and coverage gaps,” he says. “If there are discernible pollu-

provide you industry-specific claims examples you can share with your client.”

Reneé Miller, SVP and chief underwriting officer at Freberg Environmental, advises agents to continue to educate themselves on changes in the environmental regulatory environment and to stay informed locally.

“Many times, if a local contractor or company experiences an environmental incident, it provides the opportunity to discuss how environmental coverage responds,” she says. “Environmental coverage, in most cases, is not a required coverage – it is a discretionary spend, and usually for an incidental exposure. Educating an insured on the potential exposure and costs associated with

“Insurance brokers have their feet being held to the fire for their activities, or lack thereof, 20 years ago, which left their customers uninsured for environmental losses today” David Dybdahl, American Risk Management Resources Network tion exposures that are unaddressed by the existing lines of coverage, agents and brokers need to open the dialogue about pollution exposures and insurance.”

Although not all clients will commit to purchasing environmental insurance right away, Brereton believes the concept will become less foreign over time. Keep your clients engaged and up-to-date with what’s happening in the environmental space – even if they said no this year, next year the answer could be yes.

“News stories appear every day highlighting pollution incidents, so why not share claims examples with your clients?” Brereton says. “Better yet, ask your carriers to do some of the work. A responsive carrier will gladly

a loss, however incidental the exposure may be, is essential.”

Looking forward, Dybdahl expects the environmental insurance product line in the US to expand at an organic growth rate of 10%. He believes most of the growth will come from small accounts, where there’s less than 3% market penetration.

“I foresee increasing pollution losses on Main Street businesses and agricultural risks – most of these losses will be uninsured,” he says. “The E&O loss exposure to insurance agents will be light in this sector because the uninsured clients, after the uninsured loss, will not have the money necessary to pursue a professional liability lawsuit against the agent.”

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IBA JULY 2016c.qxp_Layout 1 6/7/16 11:48 AM Page 1

Freberg Environmental The “go-to” environmental market

For over 25 years, we have provided rock-solid service and a range of environmental coverages. With environmental underwriters who have real-world experience combined with the security of A+ rated carriers, Freberg Environmental is the “go-to” market for knowledgeable, fast and friendly service.

• Hazmat Auto & Excess Auto • Consultants & Contractors • Products Pollution • Site-Specific Pollution • Storage Tank Liability • Excess • Inland Marine

We’re here to help.

Give us a call or check us out at www.feiinsurance.com

Fast, friendly, and knowledgeable service

32-35_Ad Led Environmental-SUBBED.indd 35

2000 South Colorado Boulevard • Tower II Suite 800 • Denver, CO 80222 800/377-4152 • 303/534-1171 • Fax: 303/623-8101 FEIinsurance.com In CA dba: FEI, Insurance Services www.ibamag.com

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20/01/2017 7:35:18 AM

FEATURES

AGENCY INSIGHT

The Buckner Company Third-generation president and CEO Terry Buckner shares with IBA how integrity, honesty and knowledge have been the drivers of 80 years of success for his Utah-based agency

IBA: Tell us about The Buckner Company.

Terry Buckner: The Buckner Company just celebrated its 80th birthday on December 1 of last year. My grandfather started it during the height of the Depression, which was an interesting time to start a new company.

My father and my uncle joined the company shortly after World War II, and I joined the firm in 1979.

In 1988, I bought my father and uncle out, and then in 2001, we started a little growth spurt. Today, we have 162 employees across five different offices: two in Utah, two in Idaho and one in Colorado, and we write roughly $240 million in premium with $27 million in revenue.

IBA: What are you doing to attract new talent?

TB: I think the biggest challenge our industry faces today is attracting new and young talent to insurance. They think differently, they want different things, and we have to think more creatively on how to attract them. I think that as an industry, we have done a poor job in selling the benefits of the insurance business.

Some of the things we are doing to alleviate that is we are getting more involved

36

with various universities. We are also using our younger employees to try to tell our story to their peers – we think they are better at telling the story than we are.

IBA: How has your agency been able to continually grow and remain successful for 80 years?

TB: Having somewhat of an entrepreneurial spirit is critical – not only for me, but also for our individual producers. They need to feel like it is their own business they can grow and generate. I think that’s been critical for us.

We try to put together a reputation of high integrity and high professionalism that attracts people. We are an industry that is easily misunderstood by a lot of buyers because it is a complex product. Yet we try to be involved in the community and be known

for doing business with great integrity and insight, which in the end helps us attract the right people.

IBA: How do you support the success of your employees?

TB: We have been very verbal about the fact that the checkbook is wide open when it comes to education. We want our people to be lifelong learners, but we don’t just encourage education, we pay for it – furthering education has become a part of our people’s career progression model.

With our salespeople, we support them with marketing dollars that become their own so they can market their own brand. We try to support them financially on that side, and then the other thing we try to do is really push out our brand to our various market-

HOW BUCKNER GIVES BACK The Buckner Company spends a lot of energy getting involved with local chambers of commerce, universities and activities that are meaningful to the communities where its offices are located. In addition, the company implemented a program to become more involved with charity work.

“We have a program called Buckner Cares that has done really well for us,” says Terry Buckner. “Last year, for example, we built a ramp for a family who had a child who was disabled in a car accident over 10 years ago and couldn’t get the wheelchair in and out of the house. As a company, we try to involve all of our associates in some sort of charitable event annually to reach out and give back to the community.”

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FAST FACTS: THE BUCKNER COMPANY

Top commercial specialties

Construction

HOA and multifamily/apartments

Agriculture

“We really push out our brand to our various marketplaces so that when our producers go out to talk to someone about who we are, it’s not a real cold call.

They’ve heard of us and know about us”

Trucking and transport Year founded: 1936 Number of employees: 162 Headquarters: Salt Lake City

places so that when our producers go out to talk to someone about who we are, it’s not a real cold call. They’ve heard of us and know about us.

IBA: What are your agency’s goals and plans for 2017?

TB: For 2017, my biggest goal is to continue to attract young talent to our industry.

We realize that 25% of the million-dollar producers in our industry will be retiring in the next three years. We need to be backfilling that void. This year alone, we are looking to hire between eight and 10 new

sales professionals into our organization. We will also build our support staff to bring in new, great talent to this industry. That will be a big initiative for us.

Additionally, we finished last year with 15% growth over the year before, and we see ourselves continuing to aggressively pursue profitable growth for our firm.

IBA: What makes The Buckner Company unique?

TB: What makes us unique is that we are knowledgeable and ethical people. We preach and talk ethics and integrity all day

Number of offices: 5 Leadership: Terry Buckner, president and CEO long. We like to think we stand out when people say they do business with Buckner – not because we’re the cheapest, but because our people are professionals who are honest and who do the right thing for clients always.

That is the reputation my grandfather built this firm on, and we strive to maintain that mission regardless of what we do, and that is what makes us stand out.

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20/01/2017 4:05:54 AM

FEATURES

PERFORMANCE

Understanding personality and its role in performance When it comes to performance – a topic that is constantly on the agenda of most modern businesses – there are a number of different approaches, explains behavioral strategist Warren Kennaugh

ONE APPROACH to performance is to focus on the talent – we are told that if we are serious about improving performance, we need to find and keep talented individuals who will somehow elevate everyone else around them. As a strategy, however, this is not very effective. Enron is an example of a company that took the talent solution to heart, and look what happened to them.

Plus, this approach is expensive, timeconsuming and divisive. It puts a huge amount of pressure on the individual who is supposed to single-handedly turn things around, and at the same time alienates the rest of the workforce, who are clearly viewed as second-class citizens.

The alternative approach is to focus on team performance with the understanding that if everyone lifts their game just a little, then collectively, performance improvements will materialize. Teams may even be sent on team-building or training programs to help facilitate this outcome.

Polarities, not problems What we first need to appreciate is that individual performance and team performance are not separate problems to be solved; rather, according to consultant Barry Johnson, they are polarities to be managed. Polarities are

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ongoing, chronic issues that are unavoidable and unsolvable. And often, attempting to address them with traditional problemsolving skills only makes things worse. Team versus individual performance is a classic example of a polarity.

When faced with performance problems, most business leaders will favor one type of intervention over the other – hire more talent or invest in team-building. The reality, however, is that elevated performance is dependent on individual contribution and collective effort, not one or the other.

Too much focus on individual performance may drive greater individual initiative and creativity, as well as fewer and shorter meetings, but it may also simultaneously activate the downside of individual focus – operating in silos, increased internal competition, and no shared goals or synergy. Too much focus on team performance, on the other hand, may create more cohesive units, but at the same time decrease innovation, increase conformity and slow down decision-making.

By seeing team and individual performance as two separate problems, we engage in the ‘polarity two-step’ – we recruit expensive, talented individuals to solve the individual performance issue, only to inadvertently impair team performance by doing so. And when we ‘solve’ team performance by facilitating greater cooperation and cohesion, we can inadvertently stifle the high performers in the team.

This endless swing from individual to collective focus and back again is timeconsuming and costly. And, perhaps most importantly, it continues to ignore the importance of personality on performance.

Personality and performance When we look at individuals, we see a seemingly infinite array of complex and unpredictable thoughts, emotions and behaviors. This apparent randomness is often so daunting and confusing that personality is considered fodder for the ‘too hard’ basket.

So it’s little wonder that everyone sticks with performance improvement theories that are based around individual or collective behavior.

However, behavior is massively influ-

enced by personality. Sure, if you want to get people to do different things or get them to do those things better, you can occasionally alter that behavior through rewards, incentives or threats, but it’s usually unsustainable. When no one is looking or the bonus check has been banked, they will revert to type and go back to doing what comes naturally to them based on their own unique personalities.

When we uncover specific personality markers – namely, ‘inside,’ ‘bright side’ and ‘dark side’ characteristics – we give ourselves the power to orchestrate fit. Fit is the key to elevated consistent performance. The more

iors are, or simply deploys them innately at the right time and in the right place most of the time. By contrast, an average or inconsistent performer is not aware of exactly what those behaviors are, so they are either deployed inconsistently or deployed in a role or environment that doesn’t need or value those particular behaviors.

As a result, performance is often down to chance. This is why sports are so littered with superstitions. In the absence of any real insight into what makes a player good or bad, they fall back on lucky socks and quirky pre-game routines.

“Elevated performance is dependent on individual contribution and collective effort, not one or the other” our natural strengths, characteristics, skill set and values fit with what is required in the role and fit with the culture and organization itself, the higher the performance will be.

‘Inside’ personality characteristics help to identify what naturally motivates and inspires us. Clearly, if what we are required to do in our role is something we are already motivated by or value, then incentives or threats are unnecessary. ‘Bright side’ personality characteristics describe us on our best days. These are our natural strengths and dispositions, which can indicate behavioral strengths. And our ‘dark side’ characteristics are the behaviors that show up when we are under pressure or stressed – they can easily derail our career unless we know about them and take steps to mitigate their impact.

What I’ve found across more than 3,000 profiles of elite performers and by working in this area for over 23 years is that everyone has four or five behaviors that evolve as a result of their unique personality. These patterns of behaviors are the way we have learned to ‘get along,’ ‘get ahead’ and ‘make meaning’ in the world, and we will use those same four or five behaviors consistently.

The only difference between a high performer and everyone else is that a high performer knows what their bespoke behav-

What we so often fail to appreciate is that behavior is behavior, and it rarely changes.

Whether that behavior manifests as a valueadding asset or a career-limiting liability largely depends on how and where it’s used and, therefore, whether we achieve fit or not.

High performance is not so much about what you do; it’s about how you do what you do, why you do what you do and where you do what you do. In fact, the only important consideration regarding what you do is what you do to screw things up.

We don’t need performance coaches to foster talent in every separate area of our life.

What we need is a genuine awareness and understanding of our ‘inside,’ ‘bright side’ and ‘dark side’ characteristics so we can match the best of who we already are to a role and environment that values that contribution. When we do that, the result is consistent, repeatable high performance.

Warren Kennaugh is a behavioral strategist who works with elite corporate leaders, gifted professional athletes and world-leading teams. He is a speaker, researcher and consultant who is the author of FIT: When Talent and Intelligence Just Won’t Cut It. Find out more at www.warrenkennaugh.com or wk@ warrenkennaugh.com .

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FEATURES

DRIVING CHANGE

Driving change in your business Taking an established business in a new direction can be a daunting prospect. Here, change and leadership expert Michelle Gibbings presents a step-by-step approach to making change happen

THERE’S A famous saying: “May you live in interesting times.” There’s debate as to its origin, but there’s certainly no doubt that it applies today. Change is everywhere, impacting both large and small organizations.

For leaders, this means they are leading in an environment that is often: • Ambiguous: The environment in which they are working is uncertain and shifting, which can leave people questioning their roles and what they need to do.

• Boundary-less: Things are changing, and the normal boundaries of roles, organizations and work are altering.

• Complex: Problems are not predictable, nor are the solutions.

• Disruptive: People and organizations are constantly searching for the ‘next big thing,’ and the quest to be innovative is never-ending.

To survive and flourish in this environment, organizations need to master four key steps: 1. Build and implement a sustainable approach.

2. Know the landscape.

3. Develop leadership followship.

4. Maintain momentum.

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1

Build and implement a sustainable approach

A 2013 Towers Watson study reinforced what other studies have shown – that the majority of organizations’ change efforts fail. This is due to a number of factors, including a lack of leadership, the difficulty of sustaining momentum, and ineffective or absent mechanisms to support the change.

Many change efforts are started before the necessary planning and analysis takes place. For example, there’s often no assessment of the organization’s capacity to absorb the change, or understanding of the capability of impacted stakeholders to adopt the change. Instead, there are multiple change programs occurring at the same time, often impacting the same group of people.

This creates confusion, particularly when the implementation efforts are disconnected from each other. All the end user sees is a barrage of changes coming down the pipeline, but little information as to how the changes connect back to the organization’s strategic agenda and what it means for them holistically.

Your organization needs to ensure its change approach is thoughtfully considered and executed. There are five elements to this:

• Ensure strategic alignment. This involves understanding what’s driving the change. Are the factors external (such as new regulation or new entrants) or internal (such as a new CEO or productivity challenges)? Also be clear on where your organization wants to get to, and how this change connects and supports your organization’s vision and strategic agenda.

• Consider the options. Develop and review the options available, and their potential risks and impacts. The options selected should have a clear benefits case.

That way you can measure if the intended benefits of the change have been delivered.

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• Develop the plan. Undertake the necessary planning to map out the steps that need to be taken to make the change happen. This is not about creating an inflexible plan; it’s about having a strong sense of direction and clarity on the way ahead and what is needed for success.

• Check the infrastructure. Identify and ensure that the necessary infrastructure to implement the plan is available and in place. This involves architecting the way in which the change program is sequenced, monitored, governed and executed to account for the organization’s capacity, capability and objectives.

• Balance the people equation. This is one of the most important elements, and it entails more than just communication and training. Helping people to cope with and thrive through change is most effective when it operates at a mindset, values and behavior level. This includes providing people with the personal and technical skills and tools to help them best operate in changing environments.

2

Know the landscape

Once the approach to the change has been outlined, it’s a good idea to take stock and determine if your organization is ready, willing and able to change. This assessment

will help your organization understand if there are gaps or areas that need to be addressed to help improve the likelihood of a successful and sustainable change.

• Ready: Your organization knows where it wants to get to and has a plan for execution, with a logically and thoughtfully sequenced change roadmap. There are always unknowns with change, and it is impossible to plan for everything. Your organization can, however, ensure it is ready to be flexible and adaptive through the change. This way it can take advantage of opportunities and respond swiftly to issues as they arise.

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FEATURES

DRIVING CHANGE TAKING ACTION IN YOUR BROKERAGE

Go through the change checklist (opposite page) to ensure your ambitions are realistic

Identify who in your brokerage will support or resist change (especially if working in a partnership)

• Willing: Your organization has effective leadership, and the roles and responsibilities of those involved in the change are clear. For example, there may be a sponsor who is accountable for the change and a project team helping to deliver the change. They need to know what roles they must play. So, too, do the leaders across your organization. Their accountability in leading the change can’t be delegated to someone else.

• Able: Your organization has the capacity and capability to execute the change and is able to invest the resources to ensure that impacted stakeholders are well prepared for the change. Your organization needs to devote both financial and people resources to ensuring that those impacted by the change are not only able to cope with it, but also know what is expected of them and have the behavioral and technical skills to thrive through it.

If your organization doesn’t meet all of these criteria, you need to do further work on designing and refining your change approach.

Define some goals that your changes will involve and ultimately achieve

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3

Develop leadership followship

Warren Buffett said that “a leader is someone who can get things done through other people.” Leaders don’t lead if there is no one following them. Leaders who can inspire and support those around them are essential in times of change, and this requires your organization’s leaders to be able to build engaged and healthy teams – teams that, in turn, create a groundswell of support and movement toward the change.

In times of change, it is not just the team and individuals who need to change. To consciously lead change, leaders need to be prepared to change themselves – their mindsets, operating styles and leadership behavior. This is more than just pinpointing new technical skills. It’s about delving into the meaning that drives your leaders’ behavior and the mental models they are applying to the decisions they make.

One way to do this is for leaders to identify

their ‘leadership moments of truth.’ These are the actions that they take – often subconsciously – that define how their leadership style is viewed by colleagues, peers and team members. They include, for example: • What they pay attention to • What they prioritize • How they react to issues and when things go wrong • What they say, and what they do and don’t do • How they allocate resources and rewards, and recruit and promote Red flags arise when a leader’s behavior is inconsistent or if they are playing favorites with team members. Team members quickly notice when a leader says one thing and then does another. If leaders want followship, they need to create an environment in which people feel valued and that their opinions matter.

How leaders engage with, support, involve and communicate with their teams will determine if a change is landed safely or not. It’s therefore critical to ensure that leaders at all hierarchical levels are equipped and motivated to lead their teams through change. This is critical, as the change needs to be driven by the leaders, and they need to have the confidence and accountability to take this on.

4

Maintain momentum

Harvard professor Rosabeth Moss Kanter talks about the trap of failing in the middle. In regard to getting change to happen, she says: “Everyone loves inspiring beginnings and happy endings; it is just the middles that involve hard work.”

This is natural. As a change starts, challenges will inevitably be encountered.

Unexpected obstacles and roadblocks will arise, making progress slower and more difficult than planned. What looked easy in the beginning seems much harder in the middle.

As reality hits home, leaders can become anxious and uncertain as they see momentum waning and milestones slipping. The team starts to question their ability to deliver, and

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“This is not about creating an inflexible plan; it’s about having a strong sense of direction and clarity on the way ahead and what is needed for success” teamwork starts to suffer as people look for someone to blame for the lack of progress.

It is at this point that deliverables start to be de-scoped and activities reprioritized, and the project team is often restructured.

This is the time when change leadership really needs to come to the fore. Leaders have two options: They can lose their nerve, or they can confront the challenges head-on. If they choose the latter, they need to: • Be clear on the project’s goals and what every person on the team needs to do to get there. Don’t get sidetracked by interesting but irrelevant matters.

• Be open with the team about what is and isn’t working. Seek their input on how the team can work better to produce more effective results.

While it is hard battling through the ‘middle,’ bravery and tenacity will pay off.

5

The change checklist

Compelling case • Is the appetite for change enough to sustain your organization through the transition from current to new state?

• Ensure these goals are able to be delivered in a meaningful and relevant time frame so the team can show regular progress.

• Is the change linked to your organization’s strategy and mission so its purpose and rationale are clear to stakeholders and team members?

• Highlight the progress being made and ensure it is visible to every team member.

Celebrate this progress in a way that is meaningful to each team member, and share this success with your stakeholders.

Clear vision • Is there a compelling vision of the future?

How was this vision created and shared across your organization? Is it understood, and do team members buy into it?

• Know where the leader’s and team’s efforts will produce the most effective results.

This is the old 80/20 rule. Focus on where you know you will get results.

Leadership alignment • How much time are your executive team and other leaders devoting to the change?

Do they see leading the change as a core part of their role?

• Work to eliminate friction in the system that makes the change harder than it needs to be. This may involve removing bureaucratic processes and unnecessary activities.

• Make it safe to fail so the team is encouraged to try new things and new ways of working. Otherwise, the team will be discouraged from trying to find better and faster ways of achieving good results.

Benefits realization • Is there an agreed benefits realization framework and approach that helps ensure that the expected benefits from the change will be realized?

Program governance and monitoring • Is there an agreed way of monitoring and reporting on progress with the change?

Process for change • Is there an agreed-upon methodology or process for designing and implementing the change?

• Is the change appropriately resourced with the right mix of skills, expertise and decision-making authority?

Sequencing and integration • Has your organization’s capacity to absorb the change been assessed? If necessary, have adjustments been made to implementation timings to ensure the best outcome?

Maintaining momentum • In what ways will momentum be sustained through the change, particularly during periods of difficulty (i.e. the ‘hard middles’)?

Culture and communication • Is your organization’s culture considered a critical aspect that can affect the success of the change? What culture changes are needed to support the change?

• Will communication be frequent enough, targeted and two-way, enabling team members to provide feedback and contribute through the change process?

• What level of experience do leaders have in coaching and guiding their teams through change?

Empowering team members • Do team members have the competencies, skills and tools to be able to change?

• If not, what will be done to support and upskill them? How will they be involved in the change?

Michelle Gibbings is a change and leadership expert, founder of Change Meridian, and the author of Step Up: How to Build Your Influence at Work. She works with leaders and teams to help them accelerate progress.

www.ibamag.com

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FEATURES

COMMUNICATION

The 10 most common blocks to becoming a remarkable communicator How can you become that person who leaves their mark on others through inspirational and memorable conversations? Georgia Murch reveals what to avoid REMARKABLE CONVERSATIONS are those that people can’t stop talking about.

We remember the clarity, ease and the great outcomes that come about. Often those people we have the most inspiring conversations with are also, unsurprisingly, the remarkable leaders – of people, of projects or ideas.

We all know someone who is brilliant at communicating. At a dinner party, their profound input may silence all diners. At the work table, somehow their contribution seems to be worth more. So, what are some of the faux pas that prevent the less impressive communicators from doing it well?

After 20 years of working with people and leaders, this is where I too often see people limit themselves, their relationships and the outcomes they are looking to achieve.

1

Having ‘yoursations,’ not conversations

One of the greatest gifts you can give someone is not your advice, but your undivided attention. To listen – really listen. The goal is to expand the conversation, not to narrow it.

A good conversation is like a tennis rally – back and forth. For communicators taking up more of the airtime in a conversation, it is time to learn that these are known as ‘your-

44

sations.’ Yoursationalists could practically have these discussions without the other person present.

2

Making little effort to search for the ‘real truth’

Coming to a conversation or business deci-

sion thinking you have all the facts is as pointless as going to relationship counseling on your own. When you’re the only one contributing, or are only prepared to listen to your side of the facts, you are more likely to reach flawed outcomes as a result. After all, you’re only focusing on number one rather

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than considering all the factors and opinions surrounding you. It is a combination of what you know plus what they know that leads to great decision-making, remarkable outcomes and deepened relationship-building.

3

Having a need to be right

When your desire to win the conversation or need to be right dominates the agenda, then you are likely to steer the conversation in the way you need with no real regard for the damage along the way. If you are not prepared to be honest with yourself,

we have not developed the courage or the right interpersonal skills to discuss the real issue. Or sometimes we interpret the issue incorrectly.

6

Letting the ‘board of directors’ in our head do the thinking

We all have a view of the world based on our upbringing, culture, faith, community, age, etc. This then forms how we perceive information, people and circumstances. These lenses, or boards of directors [BODs], skew how we see things. The BODs tell us

A good conversation is like a tennis rally – back and forth. For communicators taking up more of the airtime in a conversation, it is time to learn that these are known as ‘yoursations’ then how can you expect others to be honest with you? Being right becomes a lonely existence in which very few people trust you and even fewer want to work with you.

4

Not placing enough value on making others feel ‘safe’

Maintaining safety in a conversation is the difference between an outcome and an outbreak. When both parties feel safe enough to be honest with each other is when you reach the best outcomes and preserve – or in some cases restore – great working relationships. When we feel stressed or unsafe in a conversation, physically or emotionally, we have a stress reaction and show fight-orflight behaviors. This leads to an unhealthy exchange that gets worse rather than better.

5

Neglecting to highlight the real issue

Most people don’t feel confident enough to go straight to the heart of the problem. As a compromise, they sugarcoat it or walk around it in the hope that the other person will do the heavy lifting and see the truth hidden underneath. This could be because

that our interpretation of life, people and situations is the right one. But what if they are wrong? They often are. These BODs in our head dramatically influence how we approach conversations before, in the moment and after the fact. They take away our objective thinking and often steer us away from ideal outcomes.

7

Taking others at face value

8

Leading with opinions and feelings, not just the facts

Because of our internal board of directors, we often decide whether someone is right or wrong based on our own perceptions. We look at someone’s words and behaviors and judge them. We only see what they say, what they do and how they look. But this is not who they are. This is often only a small percentage of what’s going on for them.

We don’t make the time to consider this.

Often we find it difficult to decipher the difference between the facts and our own opinions and feelings. So we lead with our feelings and opinions in a conversation and wonder why things go wrong. Therefore,

it’s easy to understand that when we open conversations with our ‘facts,’ it’s logical that the other person is not going to effectively take the new information on board.

9

Using honesty as an excuse to verbally assassinate

Those four words: “I’m just being honest.”

They seem to give some people permission to say precisely what they think. When we practice this type of honesty, not only will we see our trust and respect bank being depleted, but also the ‘discretionary effort’ bank, too – regardless of whether we are friends or work colleagues. It will seem as if we don’t want to go the extra distance for these people anymore. They have hurt us.

It’s our own moral compass that we need to take ownership of.

10

Not knowing how to selfmanage in the moment

Are you a lover or a fighter? Do you run and hide or always have to have the last word?

Either way, knowing how you react puts you a step ahead when it comes to self-management in a loaded conversation. Most people don’t recognize their reactions until it’s too late. Alternatively, if they do, many have not yet developed a ‘toolkit’ to be able to selfmanage in the moment. If conversation is the relationship, then how we manage ourselves during that interaction is everything.

While the above 10 are the most common blocks to creating outstanding communication, they are not mountains to climb. The good news is that people can learn the skills and self-awareness to create outstanding relationships and become the people that others want to follow. I have seen it happen, and it creates a shift in cultures that is tangible.

Georgia Murch is an expert in teaching individuals how to have tough conversations and create feedback cultures in organizations.

She is the author of Fixing Feedback and a highly engaging speaker. For more information, visit www.georgiamurch.com or email georgia@georgiamurch.com.

www.ibamag.com

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PEOPLE

CAREER PATH

GLOBAL PERSPECTIVE Lori Bailey is always looking for a new challenge, as her path through the world of insurance demonstrates

Bailey grew up in “an insurance family,” helping out in her father’s agency in New Hampshire as early as middle school. A desire to work in business on an international level led her to study economics and Spanish in college. But perhaps most pivotal was her internship at AIG, where her mentor saw her potential.

After graduation, she went to work full-time with the global giant in the claims department

1997

STARTS IN INSURANCE

2000 2003

MOVES TO MARSH After three years as an underwriter, Bailey joined Marsh as VP of the company’s FINPRO division, working with D&O, EPLI, fiduciary, crime and E&O placements “I wanted to learn more; I wanted to do more – learn more coverages, learn other sides of insurance. I enjoyed [my time with Marsh] a lot, seeing a different side of the business and working with clients more directly”

2009 JOINS ZURICH Bailey made the move to Zurich in 2009 when the company formed a new business unit, Integrated Products, which brought together a number of policies in an integrated fashion “It was the culmination of everything I had done so far – it was underwriting; it was product management; it was claims; it was understanding the brokering and the marketing side”

SWITCHES TO UNDERWRITING After three years in claims, Bailey moved to underwriting, relocating from the epicenter of insurance in New York City to take a field underwriter position in AIG’s Philadelphia office. She also began a master’s degree in Spanish “When the opportunity came up, I thought [getting a master’s] would complement what I was doing and might help me at some point if I took on a global role”

2006 FINDS THE NEXT PIECE OF THE PUZZLE Bailey found herself drawn back to AIG when a former coworker called with a plan to bring her in as a product manager to help drive and shape some new initiatives “I never thought I would go back to AIG, but it was a bigger and better opportunity than I thought it would be. I thought this could be the next piece of the insurance puzzle”

2014 EXPANDS HER ROLE Bailey says her second global role was a “natural progression” of her previous position, albeit broadened to include specialty lines.

Her responsibilities include developing and implementing global strategies, portfolio management, underwriting governance and product development globally for all specialty lines

“I’ve had the privilege of traveling the world and having access to teams that truly have a global reach – it’s a dream come true”

2011

TAKES A GLOBAL POSITION Bailey’s international outlook served her well when she stepped into the role of global head of Zurich’s professional liability division. There, she took on responsibility for all professional liability product management operations, including architects & engineers, lawyers, miscellaneous professional liability, technology E&O, and security and privacy risks “At the time I didn’t think I was ready for it, but I had had increasing areas of responsibility that matched the areas of my background”

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PEOPLE

OTHER LIFE

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

ON THE ICE 400

Players Long estimates he has coached over the years

18

Years Long himself played hockey Photo: Dean Tait

24

Hours a week Long spends coaching and at games

48

Once a player and now a coach, insurance agent Bobby Long calls hockey “the greatest game in the world” BOBBY LONG has been on ice for a long time – the California-based insurance agent with Jack Stone Insurance Agency was raised by a hockey-

obsessed father, who signed him up for skating lessons when he was three years old. Long played hockey all through his childhood and adolescence and into his early 20s before stepping into the role of coach.

Now Long has a cumulative total of 25 years as a coach under his belt – a run broken only by taking time off to raise a family. These days, he coaches two teams for the Junior Sharks in San Jose.

“It’s a way of giving back to the game,” Long says. “I learned my trade by duplicating the coaches I had growing up. I took bits and pieces from the coaches that I had and learned what I could. I am always trying to improve as a teacher and as a coach.”

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