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Senior Vice President
Integro Insurance Brokers, Boston

Fueled by the Foreign Challenge

Darryl Abbey, senior vice president for Integro Insurance Brokers, recently established an insurance program for the Miami-based fuel logistics giant World Fuel Services Corp. The program came with "quality coverage" and high limits for WFS and its clients, some of them located in volatile corners of the world: parts of Africa and the Middle East. The challenge was in gaining the agreement of insurance carriers to provide a guaranty of up to $1 billion in liability limits for future WFS clients.

Abbey also helped place coverage for WFS to distribute fuel to strife-torn regions like Afghanistan and the Darfur region of Sudan, places where underwriters are reluctant to provide high limits, and where the contract wording for international relief organizations is inflexible.

For John "Chip" Allen, president of Marietta, Ga.-based SWT Aviation Inc., which sells small airplanes, Abbey was able to negotiate coverages as the manufacturer switched from direct sales to a dealer marketing model to sell the aircraft, and for which the manufacturer no longer provided insurance coverage.

"Darryl negotiated most of these airplane polices for me, which are either named pilots or have some strict flying times requirement to be covered under the policy," Allen said. "My policy says that Chip Allen or any pilot designated by Chip Allen is covered. So, Darryl has broadened the policy to fit my needs." Allen likes to say he's in the "expensive toy business," and expensive -- read unique -- toys often need a broker who can use their imagination to find ways to offer coverage. Abbey flies right into that mold.

Vice President & Partner
HUB International Ontario, Toronto

Bettinson Forms Hub of Coverage

Phil Bettinson, vice president and partner with HUB International Ontario in Toronto, saw it coming. Following a year when a regional air service client suffered a multimillion-dollar aircraft loss and was staring at a serious renewal challenge in the form of a "severe" cost increase, Bettinson landed to the rescue with a flock of alternate insurers.

Following lengthy negotiations, Bettinson modified his client's risk management approach, and was able to keep his client covered for hull and liability.

"On the one hand, we're happy to have the insurance, but the insurance carriers have tightened the screws," said John Fondse, general manager for Beaver Air Services LP outside of Winnipeg, Canada. "He was helpful in those renewal negotiations."

Scott Monsen, vice president of finance and chief financial officer for Mississauga, Ontario-based Air Georgian Ltd., said Bettinson "always gets us the best rates." Air Georgian leases aircraft from high net worth clients and other aircraft leasing companies, and those leasing contracts come with stringent insurance requirements, "so that's where Phil comes in," said Monsen.

"Going through the insurance sections of our contracts and so on, we routinely looked to him to provide the guidance," Monsen said. Such was the case in 2012, as Air Georgian added new customers on the aircraft management side.

Bettinson, aviation practice leader at HUB, switched to HUB last year from another broker, and Monsen and Air Georgian followed him.

Senior Vice President
Aon, Dallas

Broker a Heavy Lifter

When Lisa Walton, director of risk and insurance for JC Penney, wants to insure her company's small fleet of aircraft, she turns to Phillip Dressen, the Dallas-based senior vice president and regional manager for Aon Risk Solutions in Dallas. "When he goes to the insurance markets, he must be very convincing and he's been able to get us some really good improvements in our policies year over year," Walton said. The improvements include a two-year deal, using loss ratios as the trigger.

"The deal we were able to get with our July renewals is for two years, and we actually are trying to make it a rolling two years," said Walton. "The insurance markets like that, too, and there's a trigger for them to get out of the deal as well."

JC Penney's July 2012 hull and liability renewals were "significantly down," Walton said, and terms and conditions improved, thanks in part to the soft aviation market but also to plenty of supply -- Dressen brought a new market to JC Penney's aviation program this year, said Walton.

"Prior to him, without naming names, we'd had some doozies in terms of brokers," Walton said. "He's a broker with very high integrity."

Pete Lance, executive vice president of Columbia Helicopters, a Portland, Ore.-based provider of heavy-lift operations around the world, also relies on Dressen and his team. And last year was an important one for Columbia, which changed its insurance program to cover passengers.

"We weren't carrying passenger coverage at the time and we shifted to a passenger operation in a difficult part of the world and there was a lot of planning ahead with their help," Lance said.

Senior Vice President
Equity Risk Partners, Chicago

In the Defense of Diligence

When the time comes to defend your interests, your claim and your insurance program, buyers need look no further than Kim Hennessy, senior vice president -- property & casualty, of Equity Risk Partners in Chicago. She's an expert at doing the due diligence in the wake of an acquisition, particularly if it involves government contractors.

What she finds ... well perhaps she'd rather not say. But here's a hint: fragmented insurance programs parsed out among multiple carriers, high-deductible programs and loads of significant exposures that are altogether uninsured. Never mind the wasted premiums.

"They read our contracts and make sure we're covered in every area: flight testing, NASA-related issues, equipment installation and missile defense," said John Porter, corporate director of environmental health and safety for Wyle, a McLean, Va.-based high-tech service company serving the aerospace sector.

On the advice of Hennessy and her team, Wyle increased the deductible to $250,000 from $100,000 per claim for workers' compensation in exchange for lower premiums, even at a time when the company's total payroll exposures have shot up because of acquisitions.

Ken Smith, president and CEO of Doss Aviation Inc., a Colorado-based provider of aircraft support and training services to the U.S. government, said Hennessy and her team have been up to the task of insuring the company.

Doss, which was recently bought by a private equity firm, lost the incumbent broker Aon when the new owners insisted Doss use Equity Risk Partners.

Area President & Managing Director
Arthur J. Gallagher, Las Vegas

Rules of Engagement

Whom do you call if you have to place hull and liability insurance coverage for one of the most expensive aircraft ever delivered to a private customer this year? You fly in Bradley Meinhardt, area president and managing director of Arthur J. Gallagher & Co.'s Aviation niche, that's who.

Meinhardt moves fast. He placed insurance coverage for hull value in excess of $300 million, requiring liability limits of $1 billion with only three days' notice. It wasn't easy, and it required grinding through 72 hours of no sleep.

Thanks to his network of attorneys, brokers and contacts with the aircraft manufacturer, Meinhardt was able to land enough capacity to cover the risk to hull and liability using underwriters from around the world. "I would recommend Bradley 200 percent," said John Buch, president of Maverick Aviation Group Inc. in Las Vegas.

For Emilie Ryan, chief financial officer for the Lander, Wyo.-based environmental protection aviation nonprofit organization LightHawk, which relies on a large volunteer aircraft fleet, Meinhardt was able to get limits that were 10 to 20 times higher than what the company had previously. "This guy was amazing," she said.

Michael Quinn, president of Asia Pacific Airlines Inc., which owns and operates three cargo 727 jets out of Guam, said Meinhardt often spends hours explaining to underwriters why small freight airlines with only two or three pilots per plane present a much lower liability risk profile than a passenger plane.

Area Senior Vice President
Arthur J. Gallagher, Orlando, Fla.

Broker Develops a Specialty

It's been a busy year of solutions for Arthur J. Gallagher & Co.'s Richard Terlecki, a perennial Power BrokerŪ contender in the aviation category.

Due to Risk Management Solutions' Version 11.0, a new property risk model, wind loss expectancy at the Greater Orlando Aviation Authority (GOAA) increased from $50 million to $350 million. The increase caused the airport authority's carrier Zurich, to trim its named windstorm limit from $100 million to $50 million, a 50 percent cut.

Within hours of the announcement, Terlecki was on the hunt searching far and wide -- from London to Bermuda to Asia to large U.S. wholesalers -- for more capacity. Sure enough, Travelers was able to offer $50 million of named wind in excess of $50 million. The new capacity meant that taxpayers weren't saddled with having to pay extra premium.

Judy Aakeberg, senior director of administration and purchasing for the GOAA -- Orlando International Airport, called RMS 11.0 "a huge issue" for her authority's property renewals.
"We've tried to hold the line on retentions, and the reductions have come by looking critically at the coverage and determining how to do better, and which insurance market may be better than another," she said.

For another client, Terlecki was able to avoid vacancy clauses from kicking in when terminals were remodeled after Delta Airlines acquired Northwest Airlines.

CEO, Global Aviation Specialty
Aon Risk Solutions
New York

Area President
Arthur J. Gallagher & Co.
Miami