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Steve Yahn

Steve Yahn is a freelance writer based in Croton-on-Hudson, NY. He has more than 40 years of financial reporting and editing experience. He can be reached at riskletters@lrp.com.

2014 Risk All Star: Richard Pcihoda

Crisis Management Coordination

Hurricane Sandy hit Jersey City, N.J., hard in 2012, but thanks to four days of intensive advanced planning, PREIT Services LLC’s Director of Risk Management Richard Pcihoda and his team were able to get a reconstruction crew deployed at its Hudson Mall the morning after the storm struck.

“The night before the storm was underway, we had continuous communication with all of our properties in the mall and our service providers,” said Pcihoda. “We also had a command group that stayed here in Philadelphia within the corporate office overnight.”

Richard Pcihoda, director of risk management, PREIT Services LLC

Richard Pcihoda, director of risk management, PREIT Services LLC

Once the storm struck, it was important to have someone in a forward position who could relay information back, Pcihoda said.

“I immediately jumped in my truck and ran up to Jersey City and got there early enough in the day that a lot of people were still hunkered down from the night before,” Pcihoda said. “I was there in advance of formal travel bans.”

By the time community panic grew, about 18 hours later, PREIT had a truckload of fuel on-site, and dumpsters, food and sanitation facilities in place, Pcihoda said. Remediation work began within 72 hours.

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In the end, the mall suffered millions of dollars of damage, but because of the advance planning and swift set-up, PREIT was able to reopen the Hudson Mall 17 days after Hurricane Sandy made landfall.

An enormous amount of construction was completed in that period, via a trusted vendor with whom PREIT, a real estate investment trust specializing in differentiated shopping malls, had extensive prior dealings.

As a result, the mall and its tenants had a successful holiday season.

Michael Tiagwad, president and COO of Conner Strong and Buckelew, PREIT’s insurance broker, said Pcihoda is “very big on preparedness and anticipating issues and problems, and having a game plan and how to deal with a variety of situations.”

“I’d say, in general, Richard is a consummate risk manager. He has experience with all sorts of risks and exposures.

“He also has a very deep background in safety and claims,” Tiagwad added. “So he really is diverse in terms of his skills. He’s a good quarterback and he is a very engaged person, very proactive.”

PREIT’s insurance claim proceeded swiftly and smoothly, with Pcihoda coordinating with the national flood insurance program as well as PREIT’s property carrier, Fireman’s Fund.

Fireman’s provided a senior adjuster with whom Pcihoda had worked with in the past, and the 10-year relationship paid off nicely.

There was also a public adjuster to help catalog the damages, and handle a massive documentation effort, which freed Pcihoda and his team to focus on recovery.

Pamela Hans, managing shareholder in the Philadelphia office of Anderson Kill P.C., and PREIT’s insurance coverage counsel, said the business income loss at the mall was much smaller than anticipated.

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The large upfront investment in reconstruction, facilitated by prompt advances from the insurance company, paid off for all parties in the form of a smaller long-term loss and claim, Hans said.

The claim was completed and paid in full by May 2014, a tight timeframe for a claim of that scale, she said.

Responsibility Leader

Richard is also being recognized as a 2014 Responsibility Leader.

Running to the Fight

Maybe it’s his history in emergency management and current service as a volunteer firefighter that gives Richard Pcihoda the reflexes to run to the fight, because that is what he did as Superstorm Sandy threatened in October of 2012.

Not only did Pcihoda conduct the necessary planning and preparation to reduce his own company’s business interruption, he went out of his way to counsel his company’s Jersey City (N.J.) Hudson Mall tenants on coverage and recovery methods after the mall suffered millions in damage.Pcihoda, the director of risk management for the Pennsylvania Real Estate Investment Trust, based in Philadelphia, wasn’t the only risk manager whose job got a lot tougher when Sandy hit, but it looks like he outperformed many of his contemporaries.

Pcihoda looked at the whole picture and acted on it. The day after the storm struck, Pcihoda jumped in his truck and drove to Jersey City, getting there before formal travel bans were in place to jump start the recovery process.

He had his contractors in place ahead of the storm to get a jump on reconstruction. He had the adjuster relationships to pull it together seamlessly.
Pcihoda is a Risk All Star because he possesses passion, creativity and perseverance. He’s a Responsibility Leader® because through his actions, he shows others how it’s done.

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350px_allstarRisk All Stars stand out from their peers by overcoming challenges through exceptional problem solving, creativity, perseverance and/or passion.

See the complete list of 2014 Risk All Stars.

Responsibility Leaders overcome obstacles by doing the right thing over the easy thing to find  practical solutions that benefit their co-workers and community.

Read more about the 2014 Responsibility Leaders.

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2014 Risk All Star: Elizabeth Ruff

Simply Peerless

Not long out of college, Elizabeth Ruff arrived at Peerless Industrial Group in June of 2011, tasked with taking control of workers’ compensation for the company. She soon discovered that the company had a culture of lost time and that really bothered her.

“She said, ‘We’ve got to put a stop to this hemorrhaging,’ ” recalled her boss, Vice President of Human Resources Barbara Breza.

Elizabeth Ruff, human resources generalist, Peerless Industrial Group

2014 ri, human resources generalist, Peerless Industrial Group

Ruff was intent on getting employees back to work, in some capacity, as soon as possible.

“One of the first things I initiated is that whenever somebody was injured on the job and they required immediate medical attention, either myself or Barb would actually go with the employee to the health care provider’s office and sit with them,” said Ruff.

“The reason that was really key was because we were able to talk to the doctor about the fact that Peerless accommodates almost every type of light duty or transitional option,” Ruff added.

Before Ruff began her new approach, Peerless had 40 lost-time claims, multiple years in a row.

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“In 2012-2013, with a total of 386 employees in the company, we had it down to less than 25 claims,” said Ruff.

At the company’s main plant in Winona, Minn., which has 287 employees, Peerless has gone 700 days without a lost-time claim.

“It’s a pretty heavy-duty industrial manufacturing plant, so that’s a huge accomplishment, which we’re extremely proud of,” said Ruff.

“The head of underwriting at a major insurance company recently said that he has never seen anyone like Elizabeth at a company, big or small. She is truly one of a kind and a major difference-maker in our industry.” — Josh Warren, senior vice president of Equity Risk Partners

Josh Warren, senior vice president of Equity Risk Partners, Peerless’ broker, said, “They do have some additional lifting machines that make it easier on the employees, but the main difference is that Elizabeth and her colleagues in the HR department pay attention to their employees, learn from workplace injuries in order to avoid repeat situations and get people back to work.”

Warren added: “The head of underwriting at a major insurance company recently said that he has never seen anyone like Elizabeth at a company, big or small. She is truly one of a kind and a major difference-maker in our industry.”

Other accomplishments Ruff has initiated at Peerless include bolstering the company’s safety program. Safety is particularly important at Peerless because it is the largest manufacturer and distributor in North America for industrial and consumer chain and tractor products.

“One of the things I created was regular training programs,” Ruff said. “Each month, there is some type of training program project I am organizing, whether it is bringing in an external expert or coordinating with an internal supervisor.”

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Another thing Peerless has done is to spend more money on capital each year to be proactive rather than reactive.

“Each year since 2011, we’ve been adding $20,000 per year just in capital for hoists,” she said.

Under Ruff’s direction, Peerless has also been aggressive in implementing ergonomic improvements, Breza said.

Ruff still works 20 hours a week at Peerless, while also working at BIC Graphic, which she joined in June.

“What I value most about Elizabeth is her knowledge and expertise and professionalism in the field of HR and how broad-based she is and that she came in that way to Peerless when she was so young,” said Breza. “She is just so intelligent.”

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350px_allstarRisk All Stars stand out from their peers by overcoming challenges through exceptional problem solving, creativity, perseverance and/or passion.

See the complete list of 2014 Risk All Stars.

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Brokerage

On the Fast Track

EPIC is rapidly becoming one of the largest retail insurance brokers in the U.S.
By: | September 4, 2014 • 5 min read
Topics: Brokerage
EPIC

From its starting point in 2007, San Francisco-based Edgewood Partners Insurance Center (EPIC) is rapidly becoming one of the largest retail insurance brokers in the United States.

With initial funding from Stone Point Capital, the company’s founders received additional investment from the Carlyle Group in 2013.

John Redett, managing director, financial services, The Carlyle Group

John Redett, managing director, financial services, The Carlyle Group

With more than $175 million in revenue projected by the end of 2014, up from $75.l million in 2013, EPIC ranks among the top 20 retail insurance brokers in the country, and the company’s growth plan calls for an increase in revenue to more than $250 million by 2018.

Currently EPIC, a retail property and casualty insurance brokerage and employee benefits consultant, has more than 620 employees operating in California, Colorado, Connecticut, Georgia, Illinois, Massachusetts, New Jersey and New York.

In the past nine months, EPIC has made four acquisitions that added $50 million in annual revenue. Those acquisitions were:

• The McCart Group of Atlanta, one of the largest privately held insurance and risk management firms in Georgia, acquired on Jan. 9.

“As a 43-year-old company, The McCart Group had been approached many times over the years with offers to sell out to other, larger organizations,” said Jeff McCart, president of the company.

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“Before EPIC, we were never seriously interested. But when John Hahn and Dan Francis (EPIC’s California-based co-founders) introduced their vision to build a national brokerage comprised of firms with specialized expertise who want to share their collective knowledge and resources to compete against the largest brokers, it was a game changer,” he said.

• On Jan. 21, EPIC announced it acquired the program business of Boston-based Altus Specialty Group.

• On July 22, the shareholders of Jenkins Insurance Services sold 100 percent of their shares to EPIC. Jenkins employs 160 people in Reno, Nev., and in California offices in Concord, Sacramento, San Jose, and Orange County.

• On Aug. 13, EPIC added the retail risk management and property/casualty team of Stamford, Conn.-based JLT Towers Re. This strategic build-out of a team serving large, complex risk management accounts is a product of EPIC’s broadening alliance, and partnership and collaboration with JLT/Towers Re.

“This team enhances EPIC’s risk management services and offerings for our middle market and upper middle market clients, expands our reach into the public entity sector and gives us additional depth to serve clients in metropolitan New York,” said EPIC co-founder and CEO John Hahn.

Future Growth

Derek Thomas, chief strategy officer, EPIC

Derek Thomas, chief strategy officer, EPIC

“The multi-prong approach of acquisitions and the aggressive recruiting of producers and service teams has enabled us to grow organically and strategically,” said Derek Thomas, chief strategy officer. “Our plan is to advance a similar model in key regions across the United States.”

Specific geographic areas eyed for growth potential include tier 1 and tier 2 cities in the Northeast, Mid-Atlantic, Midwest and Southeast, Thomas said.

“Our strategy is to maintain the local, client-specific success drivers of our new partners while providing them with access to broader national and global resources that can also be deployed for the benefit of their clients locally,” he said.

John Redett, managing director, financial services at The Carlyle Group, added: “We see tremendous opportunity for EPIC. Since we made our initial investment in late 2013, EPIC has already expanded its footprint into the Southeast and the Northeast, as well as bolstering its West Coast operations, product capabilities and client service strength.”

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Whether it comes through additional acquisitions, geographic expansion or product growth, Carlyle supports an expansion of EPIC’s business in its effort to become a major national player, he said.

Hahn said the launch of the brokerage’s new growth phase, EPIC 2.0, “is off to a roaring start and we think the prospects for achieving our goal of $250 million in revenue in less than the original five-year plan are very favorable.”

On the Fast Track

EPIC has been on a fast-track growth pattern ever since it was launched in California in 2007, when Stone Point Capital and co-founders Hahn and Francis committed $100 million to create the groundwork for the current EPIC organization.

From the start, the company has had an investment structure that provided key employees, producers, acquired principals and executive management the opportunity to hold significant equity ownership stakes in the firm, said Francis, who serves as executive chairman.

The newly formed, California-based company went from zero to approximately $80 million in revenue in less than seven years, with average annual organic growth rates in excess of 10 percent, Francis said.

About midway through 2012, Hahn and Francis began taking a hard look at the company and its future prospects.

John Hahn, co-founder and president, EPIC

John Hahn, co-founder and CEO, EPIC

“When all was said and done,” Hahn said, “we believed we could build a super-regional/national platform through maintaining our entrepreneurial approach; improving our product and service offerings by acquiring and attracting high-quality, specialized talent; and offering successful regional broker owners and operators an opportunity to partner with us to build a national brokerage and consulting firm.”

After a thorough examination of the investor universe over the course of 2013, it became clear to EPIC that The Carlyle Group would be its best option to provide it with the additional capital required to execute EPIC 2.0 as well as offer it significant revenue potential through access to Carlyle’s portfolio companies, Francis said.

Over the course of 2013, EPIC began to restructure the company and build out its infrastructure in order to support the growth and expansion it anticipated would be necessary to drive EPIC 2.0.

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“While doing so, we also began developing an M&A and talent pipeline that would serve as the foundation of our super regional strategy,” Hahn said.

The company’s first two non-California deals closed mid-2013 with the launch of a national real estate practice with Kathleen Felderman in Denver and Jonathan Griffiths in San Francisco, and a closing of a deal in New York with Safe Harbor, which brought another property and casualty, risk management, employee benefits and private client services consulting firm into the fold. Safe Harbor was led by Tom O’Neil, who is now EPIC’s West Coast region president.

Currently, EPIC has several new deals in due diligence and a robust acquisition pipeline, with other possible deals in various stages of discussion and evaluation, said Thomas.

“And we are actively looking for other potential partners,” he said.

“In addition to targeted geographic expansion,” Thomas added, “our plan is to identify and recruit production and service teams who have proven track records in growth oriented industry sectors.”

Steve Yahn is a freelance writer based in Croton-on-Hudson, NY. He has more than 40 years of financial reporting and editing experience. He can be reached at riskletters@lrp.com.
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