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Producer
The Graham Company, Philadelphia

Smashing the Monopoly

Chris Keith, a producer with The Graham Co. in Philadelphia, knows how to bypass insurance monopolies.

Keith has three clients that provide home attendant care services, with a program appropriated by a state Medicaid waiver. However, as Medicaid reimbursement rates began to plummet, it became impossible for the nonprofits to remain in the black.

Because one carrier had a monopoly on the coverage, insurance was a large component of the nonprofits' overhead, despite the nonprofits' excellent loss experience.

Keith helped solve these issues by developing a segregated cell captive. The captive insulated the nonprofits from the volatility of the standard insurance market, reduced long-term insurance costs and created a surplus that they could use to increase their financial cushion. In the first year of written premium, the collective ownership group has experienced an 8 percent loss ratio -- $305,572 total incurred on $3.9 million in premium.

Keith and his team conducted "a ton" of due diligence to make sure the captive followed state regulations and that it would save the nonprofits hundreds of thousands of dollars, said a manager with one of the nonprofit clients. "Keith was very detailed and very good on the communication side."

Thomas H. Earle, CEO of Liberty Resources Inc., an advocacy group for independent living, said Keith and his team "streamlined our coverages in a manner that provided us better coverage, mitigated our loss claims and saved us considerable money on our insurance expenses."

Strategic Account Manager and Director
Aon, San Francisco

Thinking Two or Three Steps Ahead

It's not enough for Andrew D. Lennox, strategic account manager and director for Aon Risk Solutions in San Francisco, to get a client's claim resolved fairly and on time, he also works to prevent future spikes in premiums.

Consider this: A carrier settled a $20 million claim to a client's satisfaction, but then Lennox brought the parties together for a very intense "rip off the Band-Aid" session to resolve lingering issues of trust and improve claims and communication protocols -- for both the carrier and the client. Then Lennox convinced the carrier to continue the business relationship on an "as is" basis, achieving a very favorable renewal quote as well as an even more reasonable multiyear commitment.

"Of all the brokers I've ever met, he is by far the most strategic, the most collaborative, the most tenacious and he also gets his hands dirty in the weeds to get things done," said Andrea Pearson, global client executive at ACE Ltd. "As a middleman, he does not take things back and forth from the carrier and client. He very much owns every issue that his clients have personally. When you do that, you create collaboration." The client involved in that claim said that through Lennox's guidance and efforts, the renewal was very successful.

Ward Ching, vice president, risk management operations at Safeway Inc., said that Lennox has "superior analytical, conceptual and market communications skills."

"He is very good at analyzing a client's risk profile. ... All of which can impact programming or layer pricing differently," Ching said.

CEO
Litchfield Insurance Group, Torrington, Conn.

A Bold Bet on the Series Captive

Robert Phelan likens a successful loss sensitive workers' compensation program to a three-legged stool: the right products and carriers, integration of safe work practices, and claim management with a focus on rehabilitating injured workers and getting them back to work.

This past year, Phelan, CEO of Litchfield Insurance Group in Torrington, Conn., recommended that a regional chain of nursing home facilities get out of the guaranteed cost insurance market and consider a loss-sensitive approach by designing a Delaware-based series captive. "To date this new program is meeting our expectations and we hope to reduce our net cost by $1 million-plus for the first year," said the health care company client.

Phelan and his team attacked the client's indirect soft costs by hiring a nurse case management company to triage medical treatment at the front end of the claim process, helped claims staff coordinate medical treatment and return-to-work practices, and provided training to supervisors regarding transitional duty.

"We believe that Bob's captive idea will have a positive financial impact on our company going forward," the client said.

"Bob has always been very innovative in designing a program that produces the greatest financial benefit for us," said Richard J. Ducci, president and chief financial officer of Ducci Electrical Contractors Inc. "In addition, Bob leads a team that helps us keep our employees safe and when injured, gets them back on the job as quickly as possible."

Casualty Leader
Aon, Los Angeles

Learning Not to Take 'No' for an Answer

For Mark Sato, casualty leader for Aon Risk Solutions in Los Angeles, the key is systematically addressing each client priority.

One client wanted to be rated using the most appropriate exposure base, insisted on maintaining premium and rate certainty, and asked to steer clear of volatility in its collateral obligations. Sato was able to justify to the carrier the use of the client's "store count" as the exposure base, in lieu of payroll and revenues. Sato also put together a three-year rate agreement with nominal rate increases built in each year. He also negotiated a "growth margin" of 5 percent, so if the audit comes in over the initial estimated premium, the carrier would waive the first 5 percent of the audit. And finally, Sato arranged preset loss development factors for future collateral adjustments to avoid disagreements.

"Mark Sato has been extremely good at getting in front of underwriting managers, to explain my needs for workers' comp, and to answer questions they had, so they could come up with a good quote for my business," said Will Venski, risk and insurance manager at Lawrence Livermore National Laboratory.

Doug Bell, vice president of U-Haul insurance programs at Amerco, U-Haul's parent company, said Sato was "a bulldog on behalf of his clients."

"He puts himself in front of carriers on your behalf and won't take no for an answer," Bell said. Another client said Sato did a "fantastic job" during renewal, negotiating modifications to the client's multiyear agreement with the insurer that proved beneficial to both parties.

Senior Casualty Broker
Aon, Portland, Ore.

Broker Leaves No Issues Outstanding

Aon Risk Solutions' Senior Casualty Broker Anne Stites' technical knowledge of program design combined with strong relationships with underwriters has created "outstanding results" for her clients.

For one new client, Stites, based in Portland, Ore., and her team discussed costly program elements that had never been reviewed, including the program's aggregate loss and the way medical cost containment charges were handled. The final result was a six figure savings and 40 percent decrease in total cost.

"Anne is the best broker in the Portland area," said one client. "She has done a very objective job in keeping us informed and protecting us from rate increases, by having us sign a rate increase guarantee. We probably saved 10 to 15 percent, based on where the market has gone."

Another client said Stites and her team saved the organization "quite a bit" of money during renewal by "shopping the price" to secure a better bid with a different carrier. "We got the same coverage, same policy, so we basically didn't give up much at all, and we were able to shave a significant amount off of our premium due to her efforts."

A third client said Stites and her team presented "a good, competitive program" when they went out to the marketplace, and chose another carrier. "We not only reduced our premiums, but it put us in a better position to manage our claims and workers' comp exposure overall."

Senior Vice President
Integro Insurance Brokers, San Francisco

Intolerant of Errors

Marcia Tatara's niche is her strategic use of experience rating and knowledge of exposures to get the best price and coverage terms.

Tatara, senior vice president with Integro Insurance Brokers in San Francisco, was able to provide a mining client renewal quotes from the incumbent insurer, as well as an alternative quote with a new insurer despite the fact that the client had an experience rate modification increase.

She accomplished this by setting the record straight on the experience rate modification, which was merged in error with the experience modification of the company's prior owner.

Tatara's work with the client and the insurer resulted in revisions going back to 2009, making the entire account more attractive to the incumbent and to prospective new insurers.

She also has expertise in classifications. For one client, Tatara was able to separate historic data, identify the impact of partnership versus executive officers of the organization, and change and negotiate premiums that saved more than $600,000 in the first year.

"Marcia Tatara is a superstar," said client Tom Monier, senior risk management consultant at the Phoenix consulting firm of Ashton Tiffany LLC. "She rolled up her sleeves and was able to merge a complex integration into a self-insured workers' comp program. She has been able to correct modification factors and fine-tune. Typically brokers don't do that kind of stuff, so her service goes way above and beyond the call of duty."

Another client said Tatara is "always on top of understanding the market, and all of the challenges that come into play when trying to get us reinsured."

U.S. Manufacturing & Automotive Practice Leader
Marsh
Cleveland

Senior Vice President, Director of Claims
HUB International
Chicago

Senior Vice President
Beecher Carlson
Atlanta

Managing Director
Aon Risk Solutions
Charlotte, N.C.