Risk And Insurance - Power Broker®

Global

2010 Power Broker^® Winners

Peter Breitstone

Managing Principal and CEO, Environmental Services Group
Aon, Jericho, N.Y.

Sustaining the Advantage

Peter Breitstone, managing principal and CEO of Aon's Environmental Services Group, has this past year been preaching about the issue of sustainability and risk management throughout the world as Aon has devoted significant time and investment in developing its international environmental practice.

His message: risk managers must embrace the concept of sustainability and anticipate and understand the impact of an emerging portfolio of risks such as climate change, water shortages, energy usage, pandemic outbreaks, supply chain continuity as well as more traditional risk management issues. Using different environmental insurance options, he has also spearheaded Aon's efforts to mitigate the impact of liabilities faced by organizations subject to the European Union's Environmental Liability Directive.

Breitstone still is involved directly with worldwide clients. For example, last year he and his Aon team developed a global environmental program for one of the largest Israeli companies. The chemical company faced significant environmental risks at a number of locations around the world. The client was exuberant about the performance of the Aon team, as Aon developed a pan-European policy that solved some specific environmental liability exposures across Europe rather than using a more traditional country-by-country coverage. The new coverage provided important enhancements to existing policies, reduced the price and gave the company access to the global environmental marketplace

Yoshihide (Dean) Enomoto

Representative Director, President & COO
Aon Japan, Tokyo

Product Liability Expertise on a Global Scale

The Asian risk management community, especially the Japanese market is maturing. One of the most difficult placements, regardless of location, is a product liability risk. For one very large electronic and component manufacturer in Japan, the Aon team, lead by Yoshihide Enomoto and Tatsuya (Jake) Yamamoto, designed, developed and implemented a new global product liability program.

The task was daunting and involved more than 140 subsidiaries and branches in more than 40 countries. The product liability issues were broad-based and needed to protect the business related to the manufacturing or sale of food, medical and other products to the general public. It had significant supply chain implications. The program combined the product liability coverage with a general liability product that resulted in more effective coverage with very significant cost savings.

Also, any broker in Japan must be well-versed in catastrophic property coverage, particularly earthquake coverage. For a large publishing company, the Aon Japan team marketed new property coverage including earthquake coverage. The results were premiums that dropped by 45 percent in a market where capacity was becoming increasingly tight.

On another program, the team overhauled the risk management and insurance programs for one of the largest airports in Japan and placed the insurance through London, Bermuda and Japan improving the coverage and the risk management program.

James Olensky

Managing Director
Marsh, New York

A Broker With a Global Outlook

James Olensky, managing director with Marsh in New York, is the lead placement specialist for Marsh's Global Risk Management Excess Casualty practice. He's the lead broker on one of the largest multinational companies in the world, with a mix of products and services ranging from manufacturing, healthcare, technology and financial services.

The client has facilities and operates in more than 70 countries. Claims and losses are an important issue. There are important tax advantages to having overseas losses paid in the local currencies and any global program for this client must handle complicated regulatory and international contractual issues.

The program that Olensky initiated with the Marsh team achieved efficiencies because of the loss provisions, especially in the case of a catastrophic foreign loss. The team inaugurated a series of improvements that took a complex policy, simplified coverage and all endorsements and corrected dozens of coverage inconsistencies.

Among other improvements was the use of geographic and industry peer reviews; stress testing to clarify possible loss scenarios and an ongoing risk transfer renewal program. The client also used Olensky's expertise in excess casualty/liability placement. The improvements focused on developing a "dual tower" strategy, one for U.S. exposures and another for non-U.S. exposures. Among the benefits of the program is the ability to access additional global capacity and identify advantages, disadvantages and obstacles in the current program.

Donald R. Engle Jr.

Senior Vice President
Oswald Companies, Birmingham, Mich.

Wrapping the Globe

What industry probably faced some of the biggest international risks this past year? If the automotive industry comes to mind, then it's Donald R. Engle Jr., senior vice president with the Oswald Companies, who is the international expert.

In these tough times, he brought new consistency to the global risk management programs of his automotive and automotive supplier companies. For example, one new client last year was a huge, international plastics company. It had a decentralized risk management process where local subsidiaries and business units managed their own risks and placed their own insurance-- or self insured. Local operations were responsible for their local P&L without regard to the effectiveness of local risk management programs. That gave the local groups the incentive to have low retentions and first dollar coverage--something not necessarily in the best interest of the parent company.

Engle and his team executed a comprehensive audit of all programs placed in 27 countries. The result was a consistent global best practice procedure. The risk management goals of the company were adopted worldwide. Coverage was consolidated in regions, like Europe, where it made sense. Directors' and officers' (D&O) coverage was inaugurated outside of the United States in compliance with local laws. And a global marine program was instituted that saved the client significant dollars.

Kristine Furrer

Senior Vice President, Property/Casualty Practice Leader
Woodruff-Sawyer, San Francisco

The Master Overseer and "Overseas-er"

While Kristine Furrer is one of the key global brokers at Woodruff-Sawyer, she also leads the firm's effort to expand Woodruff-Sawyer's initiative in the "Green Technology" sector. That practice now serves 40 clients.

Woodruff-Sawyer is part of Assurex Global's international network, and Furrer takes the lead here as well as the chairman of the Assurex International Insurance Conference.

With her international clients, Furrer provides "strategic oversight" and also leads the implementation of international audits, where she develops protocols and tools for clients to share information globally. She works both with longtime Woodruff-Sawyer clients, and with new clients facing emerging risks in a global economy.

The challenge with international placements often focuses on the need for consistent coverage globally. This year, with a new client, she was able to provide that consistency and also saved the client more than 30 percent on the cost of coverage.

Her international placements are worldwide, ranging from the Pacific Rim to Europe. And claims, often the most challenging part of international coverage because of the myriad tax implications and local regulatory issues, are often the focus of her efforts.

For one U.K. client, she was able to resolve a difficult claim for a very large property loss. She also brings to her work previous experience as a risk manager with a technology company, another client noted.

John Turner

Chairman, Specialty Products
Aon, London

A Broker with Plenty of Capacity

John Turner, chairman of Aon Specialty Products Ltd. with UK Aon Global in London, heads up Aon's global placement operations. He's the team leader for a group of 250 global brokers.

Turner regularly confronts unusual and hard-to-place risks from the very largest clients, usually with facilities worldwide. This past year he solved some especially difficult property placement challenges. One client explained that Turner and his team were especially creative in how they went about finding a solution.

For example, Turner's team used catastrophic risk modeling techniques to generate several hundreds of millions of dollars of wind capacity for clients with especially difficult and vulnerable property locations. With another client, Turner confronted the need to place two noncancellable programs. These kinds of programs could not be placed in the U.S. market and were placed through a unique program in London and Europe.

As with any large, complex risk, claims are to be expected. During the last 18 months, Turner managed the settlement of $500 million in claims. He works as the liaison between clients and the markets and has been able to negotiate some critical settlements.

In addition, Turner was part of the team that developed GRIP, the proprietary global benchmarking and brokering information system that gives Aon unique insights into the tracking and placement of global risks.