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2018 Power Broker

Construction

A Joint Venture Pioneer

Danette Beck, CPCU, ARM, CRIS
Managing Director
Marsh, Los Angeles

In a pioneering effort, Marsh’s Danette Beck borrowed a practice from engineering and brought it to the construction sector.

“We work often through joint ventures, and we don’t construct low-risk projects,” said the risk manager at one client. “Our incumbent carriers were not giving us competitive terms, and that was making us uncompetitive in bidding for work.”

Beck went to several markets and assembled a small group of underwriters willing to be a ready pool to evaluate and write specific joint venture projects individually or jointly.

“I knew this technique from engineering, but it has not been done in construction for general liability,” said another risk manager. “We had meetings with the carriers and site visits. Everyone at the table knew everyone else, and we were able to connect with them at the correct level for them to understand our business.”

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For another client, Beck’s achievements make her stand out from the crowd.

“Our company had been underserved by a large brokerage house,” said the general counsel for the client. “We decided to go through an elaborate request-for-quote process whereby we interviewed numerous national and local brokerage firms.

“Since we selected Danette, she has exceeded our expectations. We have secured better insurance programs under her advice with significant costs savings. It is one thing to be good at selling yourself, it’s entirely different to be good at performance. She is innovative, responsive and anticipates our every need.”

The Power of Hearing

Justin Johnson
Account Executive
Aon, Pittsburgh, Pa.

Four simple words convey a simple act. Amid all the ringing endorsements and table-pounding testimonials, it was a powerful statement about Aon’s Justin Johnson: “He listened to me.”

The insurance manager elaborated, “Justin took over as account executive of our property/casualty agreement a little over half way through a very difficult first year and turned the account around due to his superior service.

“Since he took over the account, the rest of the year has been easy. Justin enthusiastically stepped in to a very difficult situation, which had not gone well and turned the relationship around almost immediately. Justin listened to me. He asked me questions. He worked with me.

“I am the only one in the insurance department at this organization and to have someone like Justin to reach out to for knowledge or even something as simple as a double check on a matter is invaluable to me.”

At another client, the director of risk management called Johnson a rising star: “Justin was introduced to our account [this year] through the departure of a colleague. He managed several billion-dollar construction clients while providing top-notch service.”

For another client, the key was creativity. In a placement for a large infrastructure project, each stage of completion required step changes in coverage.

In an unusual twist, the client wanted very specific portions of the project covered, with detailed sub-limits and named perils. Johnson was able to bind the coverage, with secure pricing through the project stages.

Batting One Thousand

Matias Ormaza
Senior Vice President
EPIC/Greyling Insurance Brokerage, Alpharetta, Ga.

Power Broker ® is an annual accolade, not a lifetime-achievement award. Often the actions that resulted in the recognition happen in the same year.

For Matias Ormaza, 2017 saw several major victories for a client, including a privatization, a refinancing and a first renewal under a new captive. In crediting Ormaza, the client emphasized the years of work that culminated in those triumphs.

“Matias is three for three with us,” said the chief risk officer.

“The first of those was his support in our conversion from a public company to private. We completed that in June 2017. Second was a credit facility refinancing that we conducted at the beginning of the year, for which he was of great assistance. Third was due diligence and tail coverage strategy for a large acquisition.

“He knows how to use the power of his firm to bring our strategy to the finish line. I can count on him to work with our project managers on specific insurance coverage or with an outside law firm on a big conference call debating the merits of an insurance issue in an acquisition.

“That is powerful and valuable, and in my view, the definition of a Power Broker.”

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The manager at another client’s risk management and insurance department stated, “Matias and his team were able to make recommendations that saved us over $1 million in premium this year. He is tireless in his pursuit of finding efficiencies and savings for our firm.

“Insurance is one of our top overhead costs. We are a bunch of engineers and it is vital that we understand what is driving our premium.”

A Seamless Transition

Tariq Taherbhai
Chief Operating Officer
Global Construction, Aon, Chicago

Ending a longterm relationship and moving to a new broker and new carriers can be nerve-wracking for clients. But Aon’s Tariq Taherbhai puts clients’ minds at ease.

“Under [Tariq’s] leadership, Aon seamlessly repositioned our entire insurance and risk management platform to a host of global carriers and contacts,” said a client executive.

“Our business is challenging, laden with various risks spread across a spectrum of jurisdictions and engaging a variety of levels of risk management sophistication throughout the company.

“He mobilized a team of subject-matter experts on short notice to deliver on an aggressive renewal strategy that was tailored to our needs locally and abroad.”

Taherbhai, of Aon’s global construction and infrastructure group, won praise for another complicated negotiation on behalf of a different client.

“Tariq has great ability in building strong teams, and he always leads by example,” said the risk manager. “That was displayed during our most recent bid in 2017, where Tariq managed several conflicting interests.”

The manager added, “Tariq went above and beyond on another recent pursuit to ensure proper coverage in our final bid package.

“We made several last-minute changes to our bid, which caused changes to our insurance program that the bid team had not anticipated. Tariq spotted the discrepancy and worked around the clock for the final 48 hours, which resulted in a competitive and fully compliant program.”

Pride in the Details

Kristen Long
Managing Director
Gallagher, Chicago

A Power Broker® like Gallagher’s Kristen Long is often praised for their exacting attention to detail.

“Kristen sorted through an amazing amount of accounting that the previous broker got wrong,” said a financial executive for one client. “She put it straight. She said she would, and she did.

“She did not just identify the problems, but fixed them. I am sure she absorbed hours and hours of time, and she has my loyalty from now on.”

For a beleaguered client of Long, its insurance was working backward, opening the company up to millions of dollars of risk instead of transferring it away.

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The client relies heavily on subcontractors, but Long found substantial gaps in coverage, ranging from technical definitions of coverage to exclusions, pollution coverage and omissions, such as the subcontractor’s duty to defend the general contractor.

Long placed the liability coverage into a single wrap and had the client designated as named insured rather than additional insured. Deductible was reduced by an order of magnitude, and overall insurance cost by more than 5 percent.

A third client is a large municipality. “As one can imagine, our insurance program is extremely complex,” said the risk manager.

“Kristen handles several areas for us and also consults on others. She was instrumental this year in handling some major issues, especially in guidance on how to get more and better coverage. She is the manager for one of our owner-controlled insurance programs. That has been extremely successful.”

Impressive Skills

Andrew Canning
Senior Vice President
Marsh, New York

A client of Marsh’s Andrew Canning needed guidance establishing and managing its owner-controlled insurance programs (OCIPs).

“Andrew was instrumental in helping us with two key initiatives this year,” said one risk manager. One was overseeing the placement of an OCIP covering a large downtown project in the center of a major city that included a public-private partnership.

“The second OCIP involved the renovation and conversion from apartments to condominiums of another building in our real estate portfolio. We couldn’t have done either without him.”

Another client lauded Canning for resolving a complication between his OCIP and the program of the company managing the project. “I was immensely impressed this year by the skill and dedication of Andrew in helping our organization,” said the client.

“We ran into significant hurdles with one construction manager’s insurance program and its relationship to the OCIP. Andrew was instrumental in identifying gaps in information and contributing to the resolution of the problem that resulted in substantial savings.

“Andrew was willing to explain repeatedly the circumstances to many individuals, to come to multiple out-of-state meetings on short notice, and make himself available to all stakeholders to achieve the best result for our institution. Andrew knows his stuff.

“What’s more important, however, was his attitude and demeanor throughout the process. He has been a great asset to us.”

The complete list of 2018 Power Broker® winners can be found here.

Finalists: 

Louis Cipollo
Account Executive
Aon, Philadelphia

Brian Mack
Senior Vice President, Construction Practice Manager
Lockton, Washington, D.C.

Ryan McClafferty
Risk Consultant
INSURICA, Little Rock, Ark.

John Wagner
Area President, National Construction Director
Gallagher, Hunt Valley, Md.

More from Risk & Insurance

More from Risk & Insurance

2018 Risk All Stars

Masters of Risk

The concept of risk mastery and ownership, as displayed by the 2018 Risk All Stars, includes not simply seeking to control outcomes but taking full responsibility for them.
By: | September 14, 2018 • 3 min read

People talk a lot about how risk managers can get a seat at the table. The discussion implies that the risk manager is an outsider, striving to get the ear or the attention of an insider, the CEO or CFO.

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But there are risk managers who go about things in a different way. And the 2018 Risk All Stars are prime examples of that.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Goodyear’s Craig Melnick had only been with the global tire maker a few months when Hurricane Harvey dumped a record amount of rainfall on Houston.

Brilliant communication between Melnick and his new teammates gave him timely and valuable updates on the condition of manufacturing locations. Melnick remained in Akron, mastering the situation by moving inventory out of the storm’s path and making sure remediation crews were lined up ahead of time to give Goodyear its best leg up once the storm passed and the flood waters receded.

Goodyear’s resiliency in the face of the storm gave it credibility when it went to the insurance markets later that year for renewals. And here is where we hear a key phrase, produced by Kevin Garvey, one of Goodyear’s brokers at Aon.

“The markets always appreciate a risk manager who demonstrates ownership,” Garvey said, in what may be something of an understatement.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Dianne Howard, a 2018 Risk All Star and the director of benefits and risk management for the Palm Beach County School District, achieved ownership of $50 million in property storm exposures for the district.

With FEMA saying it wouldn’t pay again for district storm losses it had already paid for, Howard went to the London markets and was successful in getting coverage. She also hammered out a deal in London that would partially reimburse the district if it suffered a mass shooting and needed to demolish a building, like what happened at Sandy Hook in Connecticut.

2018 Risk All Star Jim Cunningham was well-versed enough to know what traditional risk management theories would say when hospitality workers were suffering too many kitchen cuts. “Put a cut-prevention plan in place,” is the traditional wisdom.

But Cunningham, the vice president of risk management for the gaming company Pinnacle Entertainment, wasn’t satisfied with what looked to him like a Band-Aid approach.

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Instead, he used predictive analytics, depending on his own team to assemble company-specific data, to determine which safety measures should be used company wide. The result? Claims frequency at the company dropped 60 percent in the first year of his program.

Alumine Bellone, a 2018 Risk All Star and the vice president of risk management for Ardent Health Services, faced an overwhelming task: Create a uniform risk management program when her hospital group grew from 14 hospitals in three states to 31 hospitals in seven.

Bellone owned the situation by visiting each facility right before the acquisition and again right after, to make sure each caregiving population was ready to integrate into a standardized risk management system.

After consolidating insurance policies, Bellone achieved $893,000 in synergies.

In each of these cases, and in more on the following pages, we see examples of risk managers who weren’t just knocking on the door; they were owning the room. &

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Risk All Stars stand out from their peers by overcoming challenges through exceptional problem solving, creativity, clarity of vision and passion.

See the complete list of 2018 Risk All Stars.

Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]