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OLIGARCHY ALTERNATIVE

Dear Editor,

The risk managers themselves ultimately decide where the business goes. Their decision is tied to factors such as expertise, value-added services and negotiating skills--talents many firms bring to the table. Perhaps the greatest differentiating factor now playing a role is the ability of a broker to prove that they have "skin in the game." This is the kind of advantage that independent brokers provide because their very livelihood is tied to the firm through personal ownership--and their clients' success means their success.

And it's a new breed of independent brokers that are picking up the business formerly held by the "big four" because they have another competitive strength--size and clout created by their inclusion in global networks (such as Assurex Global, which had combined premiums of over $23 billion in 2006). These kinds of organizations eliminate all geographic barriers and are made up of like-minded independent brokers who share ideas and resources. Such independent firms have also provided an engaging atmosphere where many of the country's most talented brokers have learned to be truly entrepreneurial because they are charged with answering to the client, not to Wall Street.

In fact, this innovative atmosphere at independent firms has proven so attractive that there has been a real exodus of talented individuals in recent years from the large publicly traded agencies to the large regional and privately held agencies.

Global clients have followed suit and discovered independent brokers who are part of global networks bring all the benefits of the "big four" (geographic coverage and negotiating clout), but add the important, differentiating elements of invested client-service, flexibility and innovation. Risk managers have discovered that there is, in fact, an outstanding alternative to the big four and their perceived "oligarchy" or "cartel" mentality.

Paul J. Hering, CIC, CPCU

Managing Principal and CEO,

Barney & Barney LLC

San Diego, Calif.

Chairman, Assurex Global

MAKING AN IMPRESSION

Dear Editor,

I have been reading Peter Rousmaniere's columns for years, but his column on fixing errors (Risk & Insurance®, June 1, 2007, Page 20) is so insightful, so enlightening and so helpful, that I am forced to write and let you know how much it is appreciated. I am forwarding this column to as many of my associates as I can think of. After more than 30 years in the workers' comp arena, something has finally impressed me.

David M. Goldojarb, M.S., CPDM

Disability Case Manager/Ergonomist

Pratt & Whitney Rocketdyne Inc.

Canoga Park, Calif.

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September 1, 2007

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