Straight out of the gate early next year, Ed Donnelly, named to the newly created position of president of Hiscox USA, undoubtedly will begin to cut a substantial swath through a significant but often untapped sector of the American insurance industry.
Think not Fortune 1000 companies, primarily anyway. Instead, think of the types of companies that a group Donnelly led in his previous position at Houston Casualty Co. penetrated so successfully. Those were companies with fewer than 200 employees, where various kinds of policies are sold, both commercial lines to the companies, but also personal lines to owners and top officers.
London-based Hiscox Plc. underscored this in its recent appointment of Donnelly, saying that in addition to heading Hiscox's operations in the United States, Donnelly "will also be in charge of launching and rolling out Hiscox's specialist products for businesses outside the Fortune 1000 that are placed through U.S.-based local and regional brokers."
Consider the numbers. According to the latest U.S. Census Bureau data, there are 6.9 million companies in the United States with fewer than 200 employees. It is well-known in the industry that the number of smaller-size company accounts Donnelly and his group handled at Houston Casualty ran in the thousands.
Hiscox and Donnelly have a tall order, as they are going to compete with Chubb and AIG, the key insurers in the U.S. midsize to smaller-size company insurance market.
Donnelly, 45, will report to Robert Childs, London-based director of underwriting. Donnelly, who has more than 21 years of underwriting experience, will establish an office for Hiscox USA in Armonk, N.Y.
Most recently, as senior vice president of Professional Indemnity Agency, acquired by Houston Casualty not long after Sept. 11, 2001, Donnelly started and grew a book of nontraditional professional indemnity business. "Doctors and lawyers traditionally have been accounts, of course," said Donnelly. "But there is a much larger universe. The real estate business is a prime example. And there are architects, engineers, construction managers, consultants and insurance companies themselves, which buy professional liability coverage."
Also, noted Donnelly, "a lot of technology firms are not aware of their potential exposures, both directly and through relationships with their clients. With the growth and greater attention focused on computer viruses, unaltered access to computers, copyright trademark and infringement on software, clients of insureds are often demanding this coverage.
"Clearly in the U.S. market," Donnelly added, "there's great opportunity not only in the tech area, but in many other service industries."
Donnelly--who grew up above a drugstore in the Queens borough of New York City with his mother and brother, and then worked his way through the Georgia Institute of Technology, receiving an undergraduate business degree--started his professional career at AIG's Pine Street office in New York in early 1984.
During five years at AIG, he rose to underwriting manager, a position in which he and associates built a large book of professional indemnity business.
At the same time Hiscox announced the hiring of Donnelly, the specialist insurance group made two other appointments to develop its distribution network for Fortune 1000 company risks in the United States--where the insurer already does 40 percent of its business.
Both these roles target large international insurance coverage placed in London via global broker networks.
Nick Ward, 42, was promoted to the newly created position of global markets development underwriter for Hiscox Syndicate 33. Based in the United States, his role will involve development of new business, as well as servicing existing accounts, across all lines placed into the syndicate via the London broker network. Ward previously ran the global markets professional indemnity account for the syndicate.
David Chavez, 47, joins Hiscox as U.S. technology underwriter, working with the global markets TMT (Technology-Media-Telecom) team to develop its relationships with brokers and clients in America. Chavez previously was assistant general counsel at Peoplesoft Inc.
"These appointments reflect our commitment to developing our service to brokers and customers in this important market and building on the strong business relationships we already have there," said Bronek Masojada, chief executive of Hiscox.
In addition to its strong presence in Great Britain and the United States, Hiscox has offices in Paris, Amsterdam, Munich, Brussels and on the Channel island of Guernsey. The European business writes mainly high-value household business and some specialist professional indemnity business. The Guernsey office underwrites kidnap and ransom business, as well as fine-art insurance business.
September 1, 2005
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