2017 Power Broker


Keeping Schools’ Missions at the Forefront

Area Vice President
Arthur J. Gallagher, Irvine, Calif.

School clients count on Brandon Cole to provide them the risk management education they need to perform their missions.

Oakland, Calif.-based Thrival World Academies, a new nonprofit, was designing a program to provide publicly subsidized education abroad to racially and socio-economically diverse students. “Since we were in our design phase, many aspects of our program shifted during this period, and Brandon supported us through all of these shifts,” said Executive Director Emma W. Hiza.

“He helped us to understand our insurance needs, to get quotes and ultimately bind all of the liability — domestic and foreign,” she said.  Cole also “has participated in meetings with the school district where we are working to help us discuss shared risk and negotiate with their insurance officials,” Hiza said.

“Without the insurance coverages that Brandon supported us in obtaining, we would not have been able to launch this fall.” she said. “His consistently quick response time has been critical to our success.”


At the Brooklyn Prospect Charter School in Brooklyn, N.Y.,  Cole not only  provided guidance on travel insurance options when students studied abroad but also ensured that the institution managed the risk of taking students outside the country, said Hillary Prince, director of finance. “We’ve since had three international trips, and everyone came home safely, so that’s priceless,” she said.

Streamlining Coverage on a Budget

Jason Helfert
Vice President
The Horton Group, Orland Park, Ill.

Nonprofit organizations count on Jason Helfert for much more than placing insurance.

CSF Illinois, an agency that supports children and adults with disabilities, tapped Helfert for help completing a merger with another organization.

“As one would suspect, the merger process is complicated, especially in our industry,” said Chief Executive Officer Mary Pat Ambrosino. “We must deal with private business factors, state issues and family issues, sometimes concurrently. While our organization went through a complicated, lengthy process, Jason Helfert helped us navigate every insurance issue that needed to be addressed with ease.

“Knowing that our organization did not have to worry about a lapse in coverage put our minds at ease, smoothing the transition period,” Ambrosino said, “Further, our costs remained relatively the same, and Jason had no monetary incentive for consolidating two existing coverages into one.”

Another nonprofit faced climbing workers’ compensation claims and costs. Helfert aided the agency in establishing a board that meets regularly to review accidents and recommend changes in policies and procedures to prevent future accidents. The board consists of agency staff and experts from Horton and the agency’s insurer.

“In the last fiscal year, our costs were almost 20 percent lower than the previous year, when we did not have the review board,” an agency official said.

Finding an Insurance Structure That Works

Ken Porter, ARM
Porter & Curtis, Media, Pa.

Ken Porter’s church clients depend on his sophisticated approach to their insurance needs.

An independent consultant noted that a mutual client was not confident in the claims information a third-party administrator provided, largely because the client had a “less-than-centralized approach” in managing its various entities, including schools, churches and charities.

Porter worked with the client’s legal team to jettison the disjointed insurance arrangement and beef up its general insurance and misconduct insurance trust. “He arranged for excess insurance of varying amounts, depending on the exposures presented, and utilized an independent casualty actuary to set up appropriate funding for losses and expenses of the trust,” the consultant said.

“The trust structure should also help to keep the client’s other assets from being subject to attachment in the event of lawsuits. There should be savings in the future due to reinsurers potentially becoming involved because of the more formal trust structure.”

The client’s risk manager noted that the trust arrangement means the client no longer needs to purchase costly misconduct coverage and can direct the savings of several hundred thousand dollars to the trust. “We have been able to now conduct actuarial studies on the program as well as to have clearly defined financial accountings of each trust account” that is distinguishable from the general operations, the risk manager said.

Focusing on Cost Control

Bill Powell, ARM
Area Executive Vice President
Arthur J. Gallagher, Itasca, Ill.

Nonprofits count on Bill Powell to help rein in overhead costs.

A large social services agency with a stratospheric 140 percent workers’ compensation loss ratio faced skyrocketing insurance premiums. Powell took over the account and first ensured that the agency’s claims were reserved and handled properly. Then he initiated loss-projection studies and an experience modifier analysis.

Facing a nonrenewal from the incumbent carrier, Powell marketed the program to more than a dozen insurers, investigating first-dollar as well as self-insured options.

After the agency selected United Heartland as the insurer, Powell worked with the carrier to provide the agency enhanced loss control assistance. That included monthly safety meetings and disseminating regular safety and loss control flyers to employees. In 2016, when it faced budget problems because of its state’s own budget woes, the agency’s loss ratio plummeted to 25 percent, resulting in a 25 percent premium reduction.

“We were getting priced out of the traditional insurance market and were facing the possibility of being forced into a risk pool,” an agency official said. “Once we were able to partner with United Heartland, the impact to our risk management program and claims was almost immediate.”

Another client, a Midwestern university, realized a 2 percent reduction in overall premiums. That “was testament to Bill’s [marketing] strategy,” one school official said.

No Project Too Big or Deadline Too Tight

Chris Schwyter
Senior Vice President
Willis Towers Watson, Radnor, Pa.

Chris Schwyter handles issues large and small for clients.

As Villanova University began a $300 million expansion project, it faced risks related to its proximity to the community and a major roadway. Risk management also inherited professional liabilities for design architects and engineering work and other risks stipulated in the contract of the appointed general contractor. Plus, the local township also had collateral requirements for site improvements, said Director of Insurance and Risk Management Ashlie Docktor.

Schwyter’s team “secured protection for Villanova with project-specific coverage for professional liability and environmental liability,” Docktor said. He also assisted in negotiations with the contractor to set worksite safety protocols and transfer some risks back to the contractor or subcontractors. In addition, he placed site-improvement bonds to meet the township’s requirements, Docktor said.

“We increased our protection for the construction project for professional and environmental liabilities and saved considerable money in the switch from letter-of-credit collateral to the surety bond,” Docktor said, “More importantly, the solutions allowed Villanova to proceed on schedule without delay.”

Schwyter helped another university client update its enterprise risk management program by providing resources that helped risk management engage senior management, the client said.

Proactively Tackling Liability Risk

Derek Symer, CPCU
AHT Insurance, Leesburg, Va.

When a federal jury determined The Hotchkiss School in Connecticut must pay a $41.5 million damage award to a former student who contracted a debilitating tick-borne disease on a school trip to China,  the ruling caught the attention of The Alexandria Country Day School five states away in Alexandria, Va.

Alexandria’s business manager, Robert Powers, was concerned that the case might mean his private day school’s own liability coverage was insufficient. Powers immediately contacted his broker Derek Symer for a solution.

Symer negotiated a “sufficient coverage increase that did not substantially impact [the school’s] budget,” Powers said.  For the next fiscal year, Symer found “more robust coverage — at a cost reduction,” he said, providing much needed relief to a stressed budget.


With all of their school clients, Symer and his team at AHT Insurance have made a priority of discussing duty of care — both in terms of buying insurance and running workshops on how to mitigate the risk.

Another client, the Maret School in Washington, D.C., wanted to help parents with student-busing assistance without shouldering additional liability.

“Derek’s guidance was quite helpful,” said Darwin Walker, Maret’s assistant head of finance and operations. “Derek’s solid advice enabled the parents and the school to find a workable solution” that relieved the parents of a huge logistical burden while avoiding additional school liability.

More from Risk & Insurance

More from Risk & Insurance

Risk Report: Marine

Crewless Ships Raise Questions

Is a remote operator legally a master? New technology confounds old terms.
By: | March 5, 2018 • 6 min read

For many developers, the accelerating development of remote-controlled and autonomous ships represents what could be the dawn of a new era. For underwriters and brokers, however, such vessels could represent the end of thousands of years of maritime law and risk management.

Rod Johnson, director of marine risk management, RSA Global Risk

While crewless vessels have yet to breach commercial service, there are active testing programs. Most brokers and underwriters expect small-scale commercial operations to be feasible in a few years, but that outlook only considers technical feasibility. How such operations will be insured remains unclear.

“I have been giving this a great deal of thought, this sits on my desk every day,” said Rod Johnson, director of marine risk management, RSA Global Risk, a major UK underwriter. Johnson sits on the loss-prevention committee of the International Union of Maritime Insurers.

“The agreed uncertainty that underpins marine insurance is falling away, but we are pretending that it isn’t. The contractual framework is being made less relevant all the time.”

Defining Autonomous Vessels

Two types of crewless vessels are being contemplated. First up is a drone with no one on board but actively controlled by a human at a remote command post on land or even on another vessel.

While some debate whether the controllers of drone aircrafts are pilots or operators, the very real question yet to be addressed is if a vessel controller is legally a “master” under maritime law.


The other type of crewless vessel would be completely autonomous, with the onboard systems making decisions about navigation, weather and operations.

Advocates tout the benefits of larger cargo capacity without crew spaces, including radically different hull designs without decks people can walk on. Doubters note a crew can fix things at sea while a ship cannot.

Rolls-Royce is one of the major proponents and designers. The company tested a remote-controlled tug in Copenhagen in June 2017.

“We think the initial early adopters will be vessels operating on fixed routes within coastal waters under the jurisdiction of flag states,” the company said.

“We expect to see the first autonomous vessel in commercial operation by the end of the decade. Further out, around 2025, we expect autonomous vessels to operate further from shore — perhaps coastal cargo ships. For ocean-going vessels to be autonomous, it will require a change in international regulations, so this will take longer.”

Once autonomous ships are a reality, “the entire current legal framework for maritime law and insurance is done,” said Johnson. “The master has not been replaced; he is just gone. Commodity ships (bulk carriers) would be most amenable to that technology. I’m not overly bothered by fully automated ships, but I am extremely bothered by heavily automated ones.”

He cited two risks specifically: hacking and fire.

“We expect to see the first autonomous vessel in commercial operation by the end of the decade. Further out, around 2025, we expect autonomous vessels to operate further from shore — perhaps coastal cargo ships. For ocean-going vessels to be autonomous, it will require a change in international regulations, so this will take longer.” — Rolls-Royce Holdings study

Andrew Kinsey, senior marine risk consultant, Allianz Global Corporate & Specialty, asked an even more existential question: “From an insurance standpoint, are we even still talking about a vessel as it is under law? Starting with the legal framework, the duty of a flag state is ‘manning of ships.’ What about the duty to render assistance? There cannot be insurance coverage of an illegal contract.”

Several sources noted that the technological development of crewless ships, while impressive, seems to be a solution in search of a problem. There is no known need in the market; no shippers, operators, owners or mariners advocate that crewless ships will solve their problems.

Kinsey takes umbrage at the suggestion that promotional material on crewless vessels cherry picks his company’s data, which found 75 percent to 90 percent of marine losses are caused by human error.


“Removing the humans from the vessels does not eliminate the human error. It just moves the human error from the helm to the coder. The reports on development by the companies with a vested interest [in crewless vessels] tend to read a lot like advertisements. The pressure for this is not coming from the end users.”

To be sure, Kinsey is a proponent of automation and technology when applied prudently, believing automation can make strides in areas of the supply chains. Much of the talk about automation is trying to bury the serious shortage of qualified crews. It also overshadows the very real potential for blockchain technology to overhaul the backend of marine insurance.

As a marine surveyor, Kinsey said he can go down to the wharf, inspect cranes, vessels and securements, and supervise loading and unloading — but he can’t inspect computer code or cyber security.

New Times, New Risks

In all fairness, insurance language has changed since the 17th century, especially as technology races ahead in the 21st.

“If you read any hull form, it’s practically Shakespearean,” said Stephen J. Harris, senior vice president of marine protection UK, Marsh. “The language is no longer fit for purpose. Our concern specifically to this topic is that the antiquated language talks about crew being on board. If they are not on board, do they still legally count as crew?”

Harris further questioned, “Under hull insurance, and provided that the ship owner has acted diligently, cover is extended to negligence of the master or crew. Does that still apply if the captain is not on board but sitting at a desk in an office?”

Andrew Kinsey, senior marine risk consultant, Allianz Global Corporate & Specialty

Several sources noted that a few international organizations, notably the Comite Maritime International and the International Maritime Organization, “have been very active in asking the legal profession around the world about their thoughts. The interpretations vary greatly. The legal complications of crewless vessels are actually more complicated than the technology.”

For example, if the operational, insurance and regulatory entities in two countries agree on the voyage of a crewless vessel across the ocean, a mishap or storm could drive the vessel into port or on shore of a third country that does not recognize those agreements.

“What worries insurers is legal uncertainty,” said Harris.

“If an operator did everything fine but a system went down, then most likely the designer would be responsible. But even if a designer explicitly accepted responsibility, what matters would be the flag state’s law in international waters and the local state’s law in territorial waters.


“We see the way ahead for this technology as local and short-sea operations. The law has to catch up with the technology, and it is showing no signs of doing so.”

Thomas M. Boudreau, head of specialty insurance, The Hartford, suggested that remote ferry operations could be the most appropriate use: “They travel fixed routes, all within one country’s waters.”

There could also be environmental and operational benefits from using battery power rather than conventional fuels.

“In terms of underwriting, the burden would shift to the manufacturer and designer of the operating systems,” Boudreau added.

It may just be, he suggested, that crewless ships are merely replacing old risks with new ones. Crews can deal with small repairs, fires or leaks at sea, but small conditions such as those can go unchecked and endanger the whole ship and cargo.

“The cyber risk is also concerning. The vessel may be safe from physical piracy, but what about hacking?” &

Gregory DL Morris is an independent business journalist based in New York with 25 years’ experience in industry, energy, finance and transportation. He can be reached at [email protected]