Power Broker Rising Stars
Judging the talent employed by commercial insurance brokers leads us to one conclusion; optimism is the order of the day.
As we discovered this year, not only are the ranks of high-achieving younger brokers as strong as ever, they are increasing in number.
We’ve renamed our Power Broker® “Under 40” category to “Rising Stars” to better celebrate this wave of talent and to focus on an important point. Yes, this is a younger group of professionals, all of them under 40, but it’s more on point to think of them as the future leaders of this profession.
As Power Broker® winners and finalists, this set of Rising Stars demonstrated a superior level of creativity in finding solutions for their clients, unflagging customer service and a devotion to learning more about their industry.
Just four years ago, the number of brokers honored by this designation hovered around 40. Last, year, there were 54 Power Broker® winners and finalists recognized in the Under 40 category.
Over the next few pages, you will see the names and affiliations of 77 brokers we recognize as Rising Stars. Since the launch of this category in 2009, more than 250 brokers under 40 received the designation.
The average age of the Rising Stars designees is 36. They represent a powerful wave of talent that is bolstering a profession, which like many other professions will be challenged to replace talent as the baby boomers retire.
For this group of Rising Stars, a career in commercial insurance brokerage is a compelling challenge that results in rich rewards.
“I really enjoy telling ‘the story’ on behalf of my client to the insurance carrier, to pique their interest in an account,” — Ashley De Paola, assistant vice president, Alliant
We first came to know Lockton’s Christopher Keith when he broke into the Power Broker® ranks as a winner in the Workers’ Compensation category in February 2013.
In those days, Keith worked for the Philadelphia-based Graham Co. Keith, 39, said it’s the “entrepreneurial” nature of the business that he finds so rewarding.
“I like the fact that I am managing my own profit and loss statement,” said Keith, who this year achieved Power Broker® status in the Aviation category.
At Lockton’s annual President’s Dinner, he was recognized as the “prototype” Lockton producer.
“I’m very proud of that,” he said.
Alliant’s Ashley De Paola, 33, a 2016 Power Broker® in the Real Estate category, said it’s the quick-paced, evolving atmosphere of commercial insurance brokerage that excites her.
“I really enjoy telling ‘the story’ on behalf of my client to the insurance carrier, to pique their interest in an account,” De Paola said.
Earlier in her career, a client expressed his concern over her age and experience. Her review of his insurance program changed his mind.
“It was very rewarding when he later asked me to work on his business,” she said.
Beecher Carlson’s Joe Roberta, a 2016 Power Broker® winner in the Private Equity category, has several reasons he likes working in this industry. Top of the list is that this is a very “social industry.”
“I truly enjoy working with people that I’ve been fortunate enough to build long-term relationships with,” he said.
Justin Wiley, 32, Power Broker® winner in the Public Sector category, works for Arthur J. Gallagher & Co., which prides itself on its mentoring efforts.
The company sent Wiley to Orlando, Fla., to work with veteran Rich Terlecki, himself a multiple Power Broker® winner.
“My goal was to learn and gather from him as much intellectual capital as possible,” Wiley said.
Clearly, Terlecki taught him well.
The 2016 Power Broker® Rising Stars
Clout in the Market
Few things are more important to boards of directors and corporate officers than directors and officers coverage – and that is where Aon’s Cara Cortes excels.
One private equity portfolio company needed D&O coverage at the end of the month. They couldn’t get an extension and an application had yet to be filled out.
Two days before coverage expired, the company asked Chip Gutshall, CEO of Work Comp Strategic Solutions, another of the portfolio companies, for help. He immediately called Cortes, who raced to the rescue.
“She got a 60-day extension for the application,” Gutshall said. “That was awesome. She carries a lot of clout within the market to pull something like that off.”
Cortes has also been extremely helpful in D&O and employment practices liability claims, he said.
“I wouldn’t trade her for anyone,” he said.
A risk manager in the Midwest said that Cortes “does a great job at matching up our exposure, our risk, with the best potential partners.
“We were able to significantly improve the coverage in several respects and to reduce the cost beyond what the [soft] market was.”
Cortes’ assistance with cyber coverage for St. Clair Hospital was what stood out the most for Linda Lattner, corporate compliance officer at the hospital.
There’s a limited market for professional lawyer liability, and Craig Howser is an expert at searching out the best specialized coverage for his clients.
On the Cutting Edge
The risks and exposures of companies in the new sharing economy receive significant media attention and face uncertain regulatory demands.
One of the Team
Weis Markets Inc. lost its risk manager this year, but rather than replacing the position, it relied more heavily on the expertise and knowledge of Michael Falvey.
“He really goes above and beyond the normal insurance broker,” said Chris De Tray, director, safety and risk management, Weis Markets.
In addition to placing insurance and shepherding renewals, Falvey is “the best business partner out there,” helping Weis proactively deal with risk management concerns, including vendor risk transfer and safety reviews.
“He absolutely is an extension of our department and understands what our model is. He does a very, very good job of making sure we are not at risk,” De Tray said.
For the Virginia Port Authority, Falvey helped Chris Harrell, vice president, contracts and risk management, rebuild the insurance program “from the bottom up. When I say the program, I mean 3,000 employees, six marine terminals and every policy you can think of from executive liability coverage to auto to human resources to ships on terminal.
“When we rebuilt it, it consolidated a lot of things,” he said. “It was a big value add.”
Marti Dickman, vice president, risk management, ADS Waste Holdings Inc., said “the quality and level of performance we get from Michael is exceptional.”
Active in acquisitions, ADS has been challenged with the structure and poor claims history of some legacy programs.
Responsive and Knowledgeable
Whether it’s addressing workers’ comp issues or the diverse needs of nonprofit organizations, Jeanna Madlener is creative, responsive and knowledgeable.
“Jeanna is tremendous,” said Vincent Salvi, risk and compliance manager at Northwest Evaluation Association (NWEA), which provides educational services to associations worldwide.
The insurance requirements from some schools can be “quite unusual,” he said, but Madlener resourcefully helps NWEA work through those challenges.
Two challenges affecting The Dussin Group, whose restaurant portfolio includes the Old Spaghetti Factory, were workers’ compensation and letters of credit, said Dean Griffith, president.
“Our outstanding letters of credit were frustrating to us,” he said, noting that Madlener “worked very hard to get those down.”
She was also instrumental in collaborating with the company’s medical provider to take responsibility for an expensive workers’ comp claim with reserves in excess of $250,000. The loss was decreased to just over $25,000, reducing the impact to Dussin Group’s premium expenses by more than 15 percent over the next three years.
Scrutinizing safety issues is also crucial, Griffith said. The company doesn’t want “rainbows and sunshine” from her store audits, he said. “A safe work environment is not just great on the cost side, but also for our people.”
Navigating Cyber Policies
Placing cyber policies is a complex undertaking, but for retail and health care organizations, that task is significantly more demanding. Kaitlin Upchurch nails it.
“She is just very, very good,” said Margot Roth-L’Heureux, global director of risk management, Whole Foods Market Inc. “She did a tremendous job.
“As anyone in the insurance world knows, cyber is not easy for anybody in retail,” she said. “You have to count on your broker to structure your program correctly and manage your expectations.
“Cyber has a lot of visibility with your officers and board right now. She brought good candidates to the table and different configurations for not only the best way to use money in our budget but to get us the best coverage,” Roth-L’Heureux said.
James Banfield, director of risk management/associate general counsel at Baylor College of Medicine, echoed those sentiments.
After years of self-insuring, Baylor wanted to explore going to market for cyber coverage. Upchurch took the lead, offering information and helping Baylor complete the “fairly extraordinary” applications.
When Baylor was dismayed about the prospect of completing each insurer’s separate application, Upchurch was able to convince the insurers to use a common document, with Baylor providing additional information if needed.
Why Marine Underwriters Should Master Modeling
Better understanding risk requires better exposure data and rigorous application of science and engineering. In addition, catastrophe models have grown in sophistication and become widely utilized by property insurers to assess the potential losses after a major event. Location level modeling also plays a role in helping both underwriters and buyers gain a better understanding of their exposure and sense of preparedness for the worst-case scenario. Yet, many underwriters in the marine sector don’t employ effective models.
“To improve underwriting and better serve customers, we have to ask ourselves if the knowledge around location level modeling is where it needs to be in the marine market space. We as an industry have progress to make,” said John Evans, Head of U.S. Marine, Berkshire Hathaway Specialty Insurance.
CAT Modeling Limitations
The primary reason marine underwriters forgo location level models is because marine risk often fluctuates, making it difficult to develop models that most accurately reflect a project or a location’s true exposure.
Take for example builder’s risk, an inland marine static risk whose value changes throughout the life of the project. The value of a building will increase as it nears completion, so its risk profile will evolve as work progresses. In property underwriting, sophisticated models are developed more easily because the values are fixed.
“If you know your building is worth $10 million today, you have a firm baseline to work with,” Evans said. The best way to effectively model builder’s risk, on the other hand, may be to take the worst-case scenario — or when the project is about 99 percent complete and at peak value (although this can overstate the catastrophe exposure early in the project’s lifecycle).
Warehouse storage also poses modeling challenges for similar reasons. For example, the value of stored goods can fluctuate substantially depending on the time of year. Toys and electronics shipped into the U.S. during August and September in preparation for the holiday season, for example, will decrease drastically in value come February and March. So do you model based on the average value or peak value?
“In order to produce useful models of these risks, underwriters need to ask additional questions and gather as much detail about the insured’s location and operations as possible,” Evans said. “That is necessary to determine when exposure is greatest and how large the impact of a catastrophe could be. Improved exposure data is critical.”
To assess warehouse legal liability exposure, this means finding out not only the fluctuations in the values, but what type of goods are being stored, how they’re being stored, whether the warehouse is built to local standards for wind, earthquake and flood, and whether or not the warehouse owner has implemented any other risk mitigation measures, such as alarm or sprinkler systems.
“Since most models treat all warehouses equally, even if a location doesn’t model well initially, specific measures taken to protect stored goods from damage could yield a substantially different expected loss, which then translates into a very different premium,” Evans said.
That extra information gathering requires additional time but the effort is worth it in the long run.
“Better understanding of an exposure is key to strong underwriting — and strong underwriting is key to longevity and stability in the marketplace,” Evans said.
“If a risk is not properly understood and priced, a customer can find themselves non-renewed after a catastrophe results in major losses — or be paying two or three times their original premium,” he said. Brokers have the job of educating clients about the long-term viability of their relationship with their carrier, and the value of thorough underwriting assessment.
The Model to Follow
So the question becomes: How can insurers begin to elevate location level modeling in the marine space? By taking a cue from their property counterparts and better understanding the exposure using better data, science and engineering.
For stored goods coverage, the process starts with an overview of each site’s risk based on location, the construction of the warehouse, and the type of contents stored. After analyzing a location, underwriters ascertain its average values and maximum values, which can be used to create a preliminary model. That model’s output may indicate where additional location specific information could fill in the blanks and produce a more site-specific model.
“We look at factors like the existence of a catastrophe plan, and the damage-ability of both the warehouse and the contents stored inside it,” Evans said. “This is where the expertise of our engineering team comes into play. They can get a much clearer idea of how certain structures and products will stand up to different forces.”
From there, engineers may develop a proprietary model that fits those specific details. The results may determine the exposure to be lower than originally believed — or buyers could potentially end up with higher pricing if the new model shows their risk to be greater. On the other hand, it may also alert the insured that higher limits may be required to better suit their true exposure to catastrophe losses.
Then when the worst does happen, insureds can rest assured that their carrier not only has the capacity to cover the loss, but the ability to both manage the volatility caused by the event and be in a position to offer reasonable terms when renewal rolls around.
For more information about Berkshire Hathaway Specialty Insurance’s Marine services, visit https://bhspecialty.com/us-products/us-marine/.
Berkshire Hathaway Specialty Insurance (www.bhspecialty.com) provides commercial property, casualty, healthcare professional liability, executive and professional lines, surety, travel, programs, medical stop loss and homeowners insurance. The actual and final terms of coverage for all product lines may vary. It underwrites on the paper of Berkshire Hathaway’s National Indemnity group of insurance companies, which hold financial strength ratings of A++ from AM Best and AA+ from Standard & Poor’s. Based in Boston, Berkshire Hathaway Specialty Insurance has offices in Atlanta, Boston, Chicago, Houston, Los Angeles, New York, San Francisco, San Ramon, Stevens Point, Auckland, Brisbane, Hong Kong, Melbourne, Singapore, Sydney and Toronto. For more information, contact [email protected].
The information contained herein is for general informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any product or service. Any description set forth herein does not include all policy terms, conditions and exclusions. Please refer to the actual policy for complete details of coverage and exclusions.
This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Berkshire Hathaway Specialty Insurance. The editorial staff of Risk & Insurance had no role in its preparation.