By JAMES IERVOLINO, vice president of risk management and insurance for Wyndham Worldwide Corp.
Will there be enough property insurance capacity to go around for costal wind, flood and quake exposure in 2009 and beyond? If so, will its cost be prohibitive and push us into retentions that don't fit our comfort zone for risk tolerance?
And the same question holds for market availability of surety capacity. Will the number of sureties or available lines of surety capacity contract as the cost for diminishing capacity continues to rise? These remain the two areas of concern for hospitality risk management accounts in the current credit-crunched, ratings-bashed, volatile insurance market.
In addition to carrier financial volatility, 2009 has brought with it unprecedented movement amongst senior underwriter officials with both domestic and international impact. These changes have altered the playing field a bit as some carriers have changed their risk tolerance and role positions on certain programs.
This has created an opportunity for risk managers to reposition their companies and their risks. New underwriting senior management means new opportunity for risk managers as new business targets are established and everyone is working towards building a sustainable book of business.
Wyndham Worldwide has greeted these challenges and industry changes by embracing them and by attempting to differentiate itself as a preferred risk management account. Wyndham's response, when many are running for cover, has been to step forward and become more visible and open to the underwriting community.
Wyndham's goal is to provide its present and future underwriter partners with unprecedented access to its people and information. In support of this goal, Wyndham recently hosted approximately 50 property insurance carrier and broker representatives at its first ever property insurance symposium. The event, which it hopes to host annually, allowed the attendees to learn more about Wyndham's unique property risks and gave its attendees access to Wyndham's senior management. Wyndham also hosts similar semi-annual events in support of its surety program where Wyndham senior management representatives present on topics germane to the company's financial performance.
Through these events, Wyndham provides access to underwriters for senior financial and operational representatives at Wyndham in a no-holds-barred, open forum of questions and answers. Both events are intended to infuse all participants with the spirit of partnership and a free exchange of information.
Wyndham believes that its risk story is unique and by providing underwriters with access to the right people and the right information it creates an opportunity for the underwriting process to maximize itself.
In addition to managing its information resources, Wyndham maximizes its people resources by partnering with industry experts for specialized brokerage support services. In a world where we are being asked to do more with less, Wyndham tries to use the right resources to gain access to capacity and leverage relationships where possible.
As an example, Wyndham's property brokerage team is comprised of representatives from four brokers: two retailers, one wholesaler and one local London broker. Wyndham has found that by allowing these brokers to focus in their area of expertise, it has created an economy of scale and compiled the right team to secure otherwise diminishing capacity for its programs.
Wyndham's approach has been to embrace the volatility of the present market by continuing to partner with the right companies and providing best-in-class access to its people and information.
April 15, 2009
Copyright 2009© LRP Publications