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Senior Vice President, U.S. Airline Practice Leader
Aon, Dallas

A Broker Earns His Wings

Risk managers insist there's always an advantage to using Stephen E. Alexandris, senior vice president and U.S. airline practice leader for Aon Risk Solutions. You get several talents rolled into one. Alexandris is a very well-connected aviation broker, and as a former aviation underwriter, he understands what underwriters are looking for.

"He's very effectively transitioned into the broker role and understands the psyche of the underwriter, and he's asking the right questions and tells them what they need to hear as opposed to what they want to hear," said the risk manager for one of the nation's largest air freight carriers.

This risk manager's 2010 aviation renewals were "below what the market rates were, and we had the best renewal out there."

"He's the man," said another risk manager representing an airline group with 168 jet and propeller planes, flying for a national carrier and its regional subsidiary.

Renewals, which went "fantastic," this risk manager said, are kept simple and straightforward even as Alexandris brings innovations and new ideas to the table.

Other risk managers also said Alexandris has transitioned very smoothly from underwriting, in which he served for 12 years at AIG Aviation and C.V. Starr Aviation, before joining Aon in 2008.

Alexandris "has done a fantastic job to the point where we've extended the deal at Aon, contingent on him being the lead broker going forward," said Franc Hangarter, managing director, corporate insurance and risk management, for American Airlines.

Assistant Vice President
Marsh, Charlotte, N.C.

Identified Flying Objects

Let's just say Lisa F. Beam, assistant vice president for Marsh, likes to come prepared. For a client with July renewals last year, for example, Beam had her prerenewal meetings beginning in January.

With 25 years of client service experience at three different firms under her belt, Beam doesn't want to leave anything to chance.

"The incumbent broker wanted to go up some, and in marketing our program around, we were able to keep rates relatively flat, and coverage was enhanced a little bit," said Daniel Pliszka, a manager in the risk management department in the city of Charlotte, N.C., which arranges its aviation liability program through Beam.

Charlotte-Douglas' aviation liability program covers the airport and the two helicopters used by policy for observation, as well as any fixed-wing aircraft that the city might charter

Airports have "nuances" with regard to buses, trucks and shuttles operating on the tarmac and around airport property, Pliszka also said.

Structuring a coverage program often entails involving the public entity, the shuttle contractor and the airlines, so risk managers in charge at Charlotte-Douglas have to be careful about overlapping programs and gaps in coverage.

For another client who was leasing a helicopter but giving flight instructions to the owner of the helicopter on the side--an arrangement that invited thorny liability issues--Beam revised the contract and required the helicopter owner to buy his own coverage to protect himself while flying around in the chopper.

Area Senior Vice President
Arthur J. Gallagher, Tacoma, Wash.

Throttling up on Underwriters

Michael Croke, an area senior vice president for Arthur J. Gallagher Risk Management Services, did some hard time on the phone and at the negotiating table last year.

He fought to get underwriters to agree to state environmental coverage limits for an Anchorage-based airline consortium and cost-sharing pool. The consortium, made up of passenger and cargo airlines, owns tank farms, pipelines, hydrants and jet fuel.

With the incumbent carrier declining to renew the $39 million environmental limit and the associated deductible, Croke and the consortium, Anchorage Fueling & Service Co., were staring at larger premiums and higher costs associated with the letter of credit. Another underwriter offered $25 million in limits, but other carriers refused to provide excess liability. In the end, Croke coaxed the new primary into providing the $39 million limit.

The underwriter also issued a issued a two-year policy to Anchorage Fueling & Service, and waived the letter-of-credit requirement. Alaska approved the plan, clearing the way for the renewal.

"Mike does what he has to do to keep the business and make sure we're getting more value for our dollar," said Jay Long, chairman of SeaTAC Fuel Facilities Consortium, a cost-sharing pool that provides jet fueling services at Seattle-Tacoma International Airport. "He's local and makes his presence known on a regular basis."

"Because of the personal service he provides, even if we did get a higher bid from someone else, we'd probably still go with him," Long said.

Executive Vice President, Aviation
Aon, New York

Broker Helps Clients on the Fly
Jay A. Innes, executive vice president with Aon Risk Solutions in New York, is a broker on the fly. And when we say "fly," we mean it.

With the ink barely dry on a major win for a request for proposal last year, Innes was off placing a brand new aviation program for a prominent aircraft leasing company.

Innes and his team obtained a placement order on a Friday night, and the negotiations, paperwork and last-minute number-crunching had to be ironed out by the following Wednesday for the London placement. There was no time to renegotiate, and the team had to get their numbers right the first time.

Calling on the team's expertise in the London office, Innes, a 21-year veteran of the industry, was able to set "realistic expectations" for the client and structure a program with a relatively low initial price.

Lest readers think Innes routinely flies by the seat of his pants, it's worth remembering that lead hull and liability prices were up 7 percent between January and July compared with 2009. Competitors, attracted by the rate increases, offered lower prices, but Innes convinced the client to avoid the low-ball bids.

Innes came prepared. He made good use of his employer's global reach, calling upon experts halfway around the world in California for advice on how best to approach the lease and contract requirements for the client in the midst of signing multiple aircraft leasing deals.

Senior Vice President
Willis, Potomac, Md.

A Broker Deep in Command of His Space

Last May, Mark Quinn, senior vice president of Willis Inspace, led a team of brokers that placed launch and in-orbit travel coverage for two powerful communications satellites.

The satellites, one launched in November and another to be launched next year, use new technology and require unique approaches to insurance coverage.

In the end, more than 20 insurance carriers around the world participated in the program to cover SkyTerra 1 and SkyTerra 2, said Kurt Haufler, vice president of finance and treasurer of LightSquared.

Though the placement was "difficult," rates were "much more reasonable that what we had planned for," Haufler said. The total sum insured was equal to one-and-a-half times the normal sum insured for a satellite launch policy. Placing the coverage required creative problem-solving, deep expertise and attention to client service. Quinn, stuck in Europe because of the ash from an Icelandic volcano, had to quarterback meetings from abroad.

For another client last June, Quinn sealed three satellite launch insurance placements for satellites carrying components used in satellite radio transmissions. Underwriters initially were reluctant to cover the components, citing previous component failures.

For six weeks, Quinn and his team worked with the client, the component manufacturer and the insurance carriers to resolve the issue just hours before the satellite launch. In the end, carriers agreed to the coverage without any new restrictions to the terms and conditions.

Vice President, Aviation Practice/Midwest
Wells Fargo Insurance Services, Cincinnati

A Friendly Broker and a Broker With Friends

Charles R. Tooley, vice president in the aviation practice for Wells Fargo Insurance Services Inc., is a facilitator, a connector, if you will, of clients and prospects.

Tooley, you see, is the kind of broker who knows people, who know people, who know people ...

At this stage of his career, after more than 25 years at Marsh and six years at Wells Fargo, Tooley has done his fair share of airline placements. He concentrates now on general and corporate aviation, flying schools and charter airlines. In other words, Tooley is most challenged by landing prospects and clients with special needs.

Like the time he helped a prospect--and future client--bring a South African Air Force Boeing 707 into the United States to test radar and telemetry. Before flying, the FAA would have to grant the aging bird a "ferry permit," so Tooley called a client who was able to send a repair crew to get the plane off the ground.

To fly you need qualified pilots--properly insured, of course. Tooley had to arrange for that as well. The broker promptly called some more clients. To save $8,000 worth of fuel on the flight to the United States, Tooley called yet another client, one with a fuel program for customers.

Once the plane was on U.S. soil, Tooley negotiated with Boeing Co. to exempt the plane from "airliner" status as it wasn't going to carry any passengers but was merely testing radar, saving his owners yet more in insurance premiums.

"We need to clone him," said an underwriter and former colleague.

Managing Director
Aon
New York

Director
Aon
Chicago