By MATTHEW BRODSK,
a former senior editor/Web editor of Risk & Insurance®.
NEW YORK--Perhaps the one thing that John Bender, 46, hasn't be able to accomplish yet in his professional life is shaving the head of his boss, Scott A. Carmilani, president, CEO and chairman of the board of Allied World Assurance Co.
Otherwise, for a kid from New York City whose first job at 13 was digging irrigation trenches at a golf course, Bender is doing all right for himself as president of Allied World Reinsurance, the U.S. reinsurance arm of the Swiss-based insurance holding company.
He joined the company in the fall of 2007 after nearly 20 years at St. Paul Re and Platinum Underwriters. He left the latter company, which was basically St. Paul Re spun off, as chief underwriting officer of its casualty reinsurance division, after realizing it was time to look for new opportunities. Some opportunities opened in 2006, but after running them by his mentors, he followed their advice and held back. He wrote for Platinum into 2007, dedicating himself to the reinsurer's clients. You see, these same mentors taught him about responsibility and respect, and a chief underwriter doesn't write clients' treaties and then cut and run.
What happened next was all timing and networking. The position at Allied World came up, One of his mentors, Jim Duffy, was on the board there, and--to top it off--Bender was already familiar with Allied World, Carmilani and the rest of its leadership because he reinsured them.
"So here's an opportunity to come build a company for a guy you know, like and respect, and have your mentor on the board. It was like a homerun for me," he told Risk & Insurance® during an interview at the Allied World headquarters on Water St. in Lower Manhattan.
As for timing, he fulfilled his duty as chief underwriting officer at Platinum for 2006-2007 but had to leave the position before attending the Property Casualty Insurers Association of America and the Professional Liability Underwriting Society meetings as a Platinum employee. If he went to those events, he would basically signal to clients that he was committing to Platinum for the next 12 months. The decision had to be made prior to those conferences.
"If I attended representing Platinum, I would be doing the wrong thing to a lot of people," he said, his New York accent reinforcing the notion that, where he comes from, you don't do that.
He instead left at the right time. He came on board as employee No. 1 at Allied World's U.S. reinsurance unit and has since had the opportunity to build it as he saw fit, with staff and leaders "handpicked" by him.
"It's honestly been the best four years of my career," Bender said. "How many people get to build something (the Allied World U.S. reinsurance platform) from scratch?"
His team leaders average 30 years of industry experience, his staff 23 years. One such leader, Ray Connors, came in to build a "very nice portfolio" of regional business. At the start of 2011, he brought in Kevin Marine, another veteran, to grow global specialty, a team that's focused on marine, aerospace and crop coverage.
The key is not only bringing in the technical underwriting skills to price business. Bender's veterans come complete with relationships built over 25, 30 years in the industry. These are the type of underwriters clients follow.
"It's nice that, No. 1, you can have the ability to bring good solid people in. It's even nicer when your customers recognize that you're marking a commitment to the business and they're willing to partner with you," Bender said.
This basically sums up Bender's marching orders. Since writing his first treaty with Allied World Reinsurance in April 2008, he has been tasked with growing the business to a certain level, maintaining it, all the while building the infrastructure and staff and capital to prepare the business for bigger and better things.
How well has Bender done in fulfilling these marching orders? If the Brooklyn Bridge and the East River 25 floors below his wall-to-wall office windows are any indication, he did all right. But what would his boss, Carmilani, say?
Ask Bender this, and Bender thinks Carmilani would say that Bender's been successful in gaining brand recognition for Allied World Reinsurance. That he's been able to get into the lines they wanted to get into and get the business they wanted on the books.
"He would say that our ability to attract quality staff has been tremendous," Bender said.
So much praise ... but has there been anything Bender's missed out on?
"Boy, I wish I would have got here in 2002 and not 2008," Bender laughed. "If we were sitting here in 2005, I would be telling you about the billion-dollar book of business I have and all the great lines of business I'm in."
Yes, we talked about the "perfect" timing of Bender's move to Allied World. On the other hand, it occurred as the soft market was becoming all too evident ... and the entire global economy skidded off the road and all too close to the edge of the cliff.
Yet dire times prove a president's mettle. All around, every underwriter's discipline was tested in this soft market (albeit, observed Bender, folks were generally better at resisting the temptation of top-line growth than in past soft cycles). All around, the market was inundated with capacity, on both the primary and reinsurance levels. Large primary insurance companies were so awash in capital, and still are, that they bought reinsurance "opportunistically." All the while, exposure values dropped across the economy, making for a smaller pie of underwritten premium to compete over.
Through it all, Bender's focus has been steely. His simple mantras: don't dabble, write profitably.
"We've made the determination that we didn't need the reinsurance volume in this market or to grow the reinsurance volume in this market if it wasn't profitable," he put it.
It's a matter of considering three things: the people, the business and the deal.
"In our mind, there are times where you can like the people but not like the business, but like the deal. There are times where you can be so-so on the people but really like the business, and like the deal. But in our mind, there can never be a time where you don't like the deal and put the business on the books," he said.
The simple strategy, in Bender's estimation, has left Allied World a smaller reinsurance underwriter, with $590 million written globally, but one that's satisfied with its current position and one that's still a "lead market" and price determinant on two-thirds of their deals.
More importantly, Allied World Reinsurance appears to be ready to pounce when the market and economy finally turn, like a grizzly waiting for spring so it can go fishing ... for more business in existing lines and new business in new lines.
"We view ourselves in such a great place. With infrastructure, staff capital, that when the market turns, we're in a great position to turn it on," Bender told us.
Pretty bold prediction, right? Especially coming from an outfit whose ultimate future success in reinsurance, it could be argued, hinges on a contested merger with Transatlantic Reinsurance (one which Bender declined to comment on).
Bender, however, comes off as a humble man. He gives praise to everyone else for his success including his boss Carmilani for giving him the chance.
"He didn't have to do that," Bender said.
To his mentors, who gave him his first chance in claims at St. Paul Re, then underwriting, then leadership. Names rattled off Bender's tongue: Bill Sandoe, Randy Hodgskin, Bob Enko, Jim Yulga, Mike Schell and Jim Duffy.
"Four days a week, Bob and Jim Yulga taught me how to underwrite, and on the fifth day of the week, Mike and Jim taught me how to run a company," Bender said, repeating often his view of the many people in the business who are very smart and capable but who may not have had the fortune of meeting such mentors.
"It's great to work with smart people. It's better if those smart people are willing to share what they know," he said.
His highest praise and devotion are reserved for his parents. His father worked two jobs and never made more than $29,000 in a year, yet his parents created such a home that Bender and his siblings "never felt like we needed anything." His parents also sent him as a kid to work for summers on his uncle's farm in County Roscommon, Ireland.
"When you're up at five to milk the cows, you're farming in the fields, or pulling turf in from the bogs, or saving hay for the animals or sheering sheep, then milking the cows again at 10 at night, and by the way, they don't take weekends off, you kind of get to grow up and see what a work ethic is, and quite frankly you get to see what you don't want to do in life to get by," he said.
Bender has also carried over family values. He has three children who are his life and whose eight to nine sporting events he attends every weekend. Life with his wife is about "making a happy home." It's also about looking after his mother, since his father passed in 2001.
Bender also gives back to the community, in particular with the St. Baldrick's charity he co-founded in 1999 with Tim Kenny and Enda McDonnell, which has raised more than $120 million for childhood cancer research. Much of the money is raised, now famously, by fundraising around people shaving their heads every St. Patrick's Day. One of the first things Bender and Carmilani discussed when Bender was being hired was head shaving.
"Look Bender, there's going to come a day that I'm going to shave my head. It's not going to be this year, and I'll let you know when," Bender recalled Carmilani saying.
Bender is content to wait because he knows his boss is a man of his word, just as surely Carmilani awaits the hardening market because he knows Bender is one too.
September 1, 2011
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