Risk Insider: Joe Cellura

Made in America

By: | February 14, 2017 • 2 min read
Joe Cellura is President, North American Casualty, at Allied World, responsible for for the production and profitability of Primary Casualty, Excess Casualty, Environmental, Surety, Primary Construction and Programs. He can be reached at [email protected]

 

Made in America: What does that mean once you get past the patriotic slogan? How does the insurance industry prepare for potential upswings in manufacturing on its own soil?

President Trump has been quite vocal about bringing manufacturing jobs back to the United States. U.S. manufacturing jobs declined from 17.3 million in 2000 to 12.3 million in 2015. Industry innovation and technology significantly reduced the workforce, but clearly, many jobs also moved overseas.

The Wall Street Journal’s recent analysis of S&P 500 company communications found that many companies are speaking with investors about the impact of President Trump’s priority to “increase U.S. manufacturing employment.”

Opening new plants is not as easy as purchasing an empty manufacturing plant, and hanging your sign on the door. There are a host of environmental concerns whether a company chooses to build new or to renovate an old plant.

CEOs are strategizing about this policy priority, and the insurance and risk management community must work alongside the C-suite as a critical part of the strategic process, assessing the new risk picture and preparing to manage these risks.

Preparing the Insurance Industry

A manufacturing workforce shift would require top-notch leadership and risk management focus. Insurance underwriters will be assessing the risk by looking at a company’s management leadership qualities and their ability to recruit and train quality employees.

Evaluating this changing risk picture should include a detailed look at exposures related to physical plants, the workers, the product and the bottom line. This requires a look across the full spectrum of risks.

For example, what are the liability issues that might arise from an untrained workforce?  What are the construction risks involved in renovating old or building new manufacturing plants?

Consider the environmental exposures. Opening new plants is not as easy as purchasing an empty manufacturing plant, and hanging your sign on the door. There are a host of environmental concerns whether a company chooses to build new or to renovate an old plant.

Even with mothballing, which ensures that plants that have been out of use are still ready and safe to reopen, there is concern that old plants will not be up to safety and quality standards. There are an abundance of unused manufacturing plants all over the U.S. that are gathering dust. Companies are trying to unload, clean-up and reuse them.  If old or new plants have any proximity to waterways and wetlands, executives need to think about the possibility of exposing those habitats to contaminants.

Changing Risk Assessments

For companies that have been out of the U.S. manufacturing world for some time, how will they manage these operations?

The insurance industry, along with manufacturers, will need to build a new model for this era of manufacturing risk. Standards must be set and manufacturers must meet them for underwriters to properly assess premiums. Precedent would be helpful, but too much time has passed since the 1950’s U.S. manufacturing zenith, when workers were not joined by robots on the assembly lines.

Manufacturing risk assessments changed when companies moved overseas because brokers and insurers could not physically go to the plants and assess risks on-site.  With the possibility of companies moving back, the insurance industry has to be prepared to walk the floors and understand what they are seeing.

The insurance industry, like the manufacturers, will need to enhance its focus from foreign risk control and liability underwriting to the complex domestic landscape. This domestic operating theater will present a myriad of legal, environmental and management challenges. The opportunity lies in meeting those challenges.

As we anticipate change on the horizon, we must take a broad look at the risk picture and begin to lay a foundation for a smooth transition to more American production. The first building blocks need to be safety. Risk management planning will protect manufacturers and their shareholder value.

More from Risk & Insurance

More from Risk & Insurance

Risk Management

The Profession

After 20 years in the business, Navy Pier’s Director of Risk Management values her relationships in the industry more than ever.
By: | June 1, 2017 • 4 min read

R&I: What was your first job?

Working at Dominick’s Finer Foods bagging groceries. Shortly after I was hired, I was promoted to [cashier] and then to a management position. It taught me great responsibility and it helped me develop the leadership skills I still carry today.

R&I: How did you come to work in risk management?

While working for Hyatt Regency McCormick Place Hotel, one of my responsibilities was to oversee the administration of claims. This led to a business relationship with the director of risk management of the organization who actually owned the property. Ultimately, a position became available in her department and the rest is history.

R&I: What is the risk management community doing right?

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The risk management community is doing a phenomenal job in professional development and creating great opportunities for risk managers to network. The development of relationships in this industry is vitally important and by providing opportunities for risk managers to come together and speak about their experiences and challenges is what enables many of us to be able to do our jobs even more effectively.

R&I: What could the risk management community be doing a better job of?

Attracting, educating and retaining young talent. There is this preconceived notion that the insurance industry and risk management are boring and there could be nothing further from the truth.

R&I: What’s been the biggest change in the risk management and insurance industry since you’ve been in it?

In my 20 years in the industry, the biggest change in risk management and the insurance industry are the various types of risk we look to insure against. Many risks that exist today were not even on our radar 20 years ago.

Gina Kirchner, director of risk management, Navy Pier Inc.

R&I: What insurance carrier do you have the highest opinion of?

FM Global. They have been our property carrier for a great number of years and in my opinion are the best in the business.

R&I: Are you optimistic about the US economy or pessimistic and why?

I am optimistic that policies will be put in place with the new administration that will be good for the economy and business.

R&I: What emerging commercial risk most concerns you?

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The commercial risks that are of most concern to me are cyber risks, business interruption, and any form of a health epidemic on a global scale. We are dealing with new exposures and new risks that we are truly not ready for.

R&I: Who is your mentor and why?

My mother has played a significant role in shaping my ideals and values. She truly instilled a very strong work ethic in me. However, there are many men and women in business who have mentored me and have had a significant impact on me and my career as well.

R&I: What have you accomplished that you are proudest of?

I am most proud of making the decision a couple of years ago to return to school and obtain my [MBA]. It took a lot of prayer, dedication and determination to accomplish this while still working a full time job, being involved in my church, studying abroad and maintaining a household.

R&I: What is your favorite book or movie?

“Heaven Is For Real” by Todd Burpo and Lynn Vincent. I loved the book and the movie.

R&I: What’s the best restaurant you’ve ever eaten at?

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A French restaurant in Paris, France named Les Noces de Jeannette Restaurant à Paris. It was the most amazing food and brings back such great memories.

R&I: What is the most unusual/interesting place you have ever visited?

Israel. My husband and I just returned a few days ago and spent time in Jerusalem, Nazareth, Jericho and Jordan. It was an absolutely amazing experience. We did everything from riding camels to taking boat rides on the Sea of Galilee to attending concerts sitting on the Temple steps. The trip was absolutely life changing.

R&I: What is the riskiest activity you ever engaged in?

Many, many years ago … I went parasailing in the Caribbean. I had a great experience and didn’t think about the risk at the time because I was young, single and free. Looking back, I don’t know that I would make the same decision today.

R&I: What about this work do you find the most fulfilling or rewarding?

I would have to say the relationships and partnerships I have developed with insurance carriers, brokers and other professionals in the industry. To have wonderful working relationships with such a vast array of talented individuals who are so knowledgeable and to have some of those relationships develop into true friendships is very rewarding.

R&I: What do your friends and family think you do?

My friends and family have a general idea that my position involves claims and insurance. However, I don’t think they fully understand the magnitude of my responsibilities and the direct impact it has on my organization, which experiences more than 9 million visitors a year.




Katie Siegel is a staff writer at Risk & Insurance®. She can be reached at [email protected]