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Senior Vice President
Marsh, Hartford, Conn.
beverly.c.costello@marsh.com

Wielding Influence

Beverly Costello is one of a handful of higher education brokers who've spent time as a university risk manager. In her case she took a five-year hiatus from her brokerage career to serve as the risk manager at an Ivy League university. That type of experience always gives the broker a leg up on competing brokers because the client knows Costello understands a risk manager's day-to-day problems.

Consider the reaction of a risk manager at a religious-based university who had only been at her job a bit more than two years. "She made a significant influence on our programs," said the risk manager.

When the risk manager initially arrived at the university, she encountered a nightmare risk management program. For starters, the university had nine different brokers and 25 different policies, all orchestrated by the previous risk manager. The policies weren't exactly the best coverage either.

"She gave our CFO the awareness that the program was all over the place," the risk manager said. The client knew Costello from previous jobs so she brought her in to fix the risk management program.

Costello introduced the university to Marsh's FINPRO, along with a new general liability program. "I was able to take this to my board," said the risk manager. Today the school has two brokers and 25 combined policies.

"She's made a huge impact," the risk manager said.

Managing Director, Education Practice Leader
Marsh, Hartford, Conn.
jean.demchak@marsh.com

The Caretaker

Jean Demchak is not just a Power Broker^TM, she's a powerful broker. As one university risk manager said, "She's wonderfully generous to her clients and to the people in the industry"--and Marsh is not even this risk manager's broker.

Demchak leads Marsh's education practice of more than 650 professionals that serve more than 2,000 institutions. In the 21 years that she has served the higher education industry, Demchak has built a reputation as a broker who focuses on the emerging and critical areas that challenge schools globally. "She shares information and plays a unique role as a facilitator," said the risk manager.

At numerous conferences and consortiums and through webcasts, Demchak talks about looming risks that most risk managers have never even thought much about. For example, she's now cautioning risk managers to be aware of the four trends that will have the most impact on the industry over the next 10 years--insufficient financial resources, technological change, changing student demographics and increased regulatory scrutiny.

But she doesn't always talk about risk. As an active member in the higher education trade group--University Risk Management and Insurance Association--she led a community service initiative called URMIA Cares at the group's most recent annual meeting.

According to a risk manager of a major Midwestern university who attended the conference, Demchak spent "four hours on her hands and knees scrubbing bathrooms" at a women's shelter. It's unknown if she also does windows.

Executive Director
Higher Education Practice
Arthur J. Gallagher, South Burlington, Vt.
Leta_Finch@ajg.com

Making Connections Beyond Insurance

Ask any university risk manager who works with Gallagher, and he or she is likely to refer to the "Gallagher Group," which is not the formal title of the broker's higher education practice. The reference is based upon the strength of the brokers who tend to work together and produce a slew of documents and white papers about specific risks, along with their abilities to come up with unique ways to solve insurance risks.

Finch is a member of this group and probably has the most unusual background, having served as a director of risk management at a research university, a faculty member at a private liberal arts college, and a trustee of both a college and a university. She also spent two years as the president of a captive. This background gives her a special rapport with her clients.

"She is one of the most original thinkers I've ever met in my whole life," said the risk manager of an East Coast college. Most recently, Finch hooked up with a risk management modeling software company called Riskonnect.

"She's looking at how to use this sophisticated computer modeling system," said the risk manager. "I met with her and the Riskonnect people and was pretty blown away on how cool this is," she said. She credited Finch for aligning Gallagher with this firm and putting together "a good product for the good of her clients that goes beyond the ERM insurance model."

Area Executive Vice President
Arthur J. Gallagher, Boston
Greg_Hunter@ajg.com

Hunting for Value

As a broker working in a specific industry, you can't assume that new clients know all the risks that are going on in their industry, and whether their insurance coverage is even adequate. Greg Hunter knows that, so he reviews new clients' insurance portfolios as a matter of course and helps them mitigate their risks by developing a benchmarking program that can offer additional coverage at the same price.

This method may not be all that unusual for a broker when working with a new client, but his smaller university clients certainly appreciate that approach because they don't have to hang around waiting for their broker to come up with some kind of customized plan.

"We've worked closely with him over the past two years, and not only has his customer service been strong, but he has proactively told us what was going on in the market or happening in the universities," said the risk manager at a religious-based East Coast university. "He used benchmarking instead of recreating the wheel," she said.

She pointed to a couple improvements Hunter's made in the school's insurance program. "We had barebones insurance coverage, and he added stronger coverage for the same cost," she said. For example, he changed the schools deductibles and limits, putting together a package all for $400,000 annually.

Another East Coast liberal arts school is happy with his strategic risk assessment, "which helped us save thousands," according to that school's risk executive.

Higher Education
Senior Vice President
Marsh, Detroit
Jerry.J.McKay@marsh.com

A Consortium Relies on Its Broker-Consort

Jerry McKay has served as the de facto risk manager of a large public university consortium in the Midwest for 10 years. A risk executive there thinks he's worthy of emeritus status. "He's done an outstanding job and is an excellent organizer at pulling the team together," said the risk manager. This year, McKay finalized a risk assessment review to identify the consortium's emerging exposures, including business risks, and is in the process of passing along this information to the members along with potential solutions.

The group has 11 members, with schools ranging from a student population of 3,000 up to one school with 40,000 students, but they all have similar needs.

With the campus shooting tragedies that have occurred over the past couple years, many universities have been creating crisis communications plans to address most any kind of crisis that could erupt on their campuses. This group is no different.

"He's been leading our crisis communication effort, looking at a couple different carriers that can provide services for the group," said the risk manager. McKay is figuring out how to configure the service and how to offer it to the membership.

One option is purchasing services through the group's excess carrier. More recently, McKay introduced an environmental and pollution liability product. "We're actually looking at the group purchase of cyberrisk for next year," added the risk manager. This is an example of how McKay customizes group purchase programs.

Managing Director
Higher Education Practice
Arthur J. Gallagher, Itasca, Ill.
john_mclaughlin@ajg.com

A Rapid Responder

In February 2008, when a former Northern Illinois University student shot 22 people and killed six students on campus, John McLaughlin led the Gallagher higher education team that advised the school after the tragic shooting event.

As the risk manager at a major East Coast university explained it, "He suggested a program to educate the campus on their response to violence." McLaughlin helped coordinate the carrier response. Not only that, he then developed a threat assessment effort and worked with the school's risk manager and general counsel to establish a process to rapidly manage the claim.

Quickly advising a client during a crisis, particularly a crisis of horrific proportions, also builds a broker's reputation and the amount of business he can bring in. "Since he took over the higher education niche in late 1999, he has substantially increased the firm's business," said the risk manager of the East Coast university.

He also apparently knows how to throw one heck of a party. For example, when he took over hosting Gallagher's dinners for its higher education clients about 10 years ago at the major higher education trade group's annual conference, maybe 10 to 20 people showed up.

Today, a risk manager said, more than 200 clients attend the dinner. "I've got to give him credit for that," he said. Another risk manager from a major Midwest school simply called McLaughlin "one of the top shelf people."

Lockton
Senior Vice President
Los Angeles

Marsh
Senior Vice President
Syracuse, N.Y.

Marsh
Senior Vice President
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Aon
Director, Public Administration and Education
Chicago

Riggs, Counselman, Michaels & Downes
Senior Vice President
Baltimore