Risk Management

The Profession

David Hornaday knows risk managers have to be more fluent and competent in the financial world. Just procuring insurance isn’t enough anymore.
By: | August 3, 2016 • 4 min read

082016_Profession
R&I: What was your first job?

Working as a signalman for Consolidated Rail Corp. I did that for about a year and a half before I got my first risk management job as a claims agent for ConRail. That was a self-insured company, so they administered their own claims.

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

ConRail got acquired by two different railroads and was split up, so I had the opportunity to either go with one of the railroads or look outside for another position, and I wanted to do more than just work with claims. I wanted to be exposed to the corporate risk management side of things. So I found a job as a risk manager for Suburban Propane in Whippany, N.J.

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

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We’re working closely with brokers and underwriters and communicating internally to bring the insurance expertise to companies that need it.

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

Risk managers should be aware of non-traditional risks and focusing on ERM, versus just the traditional insurance procurement function. That’s where the future of our profession is going.

R&I:: What was the best location and year for the RIMS conference and why?

This is a little self-serving, but I thought Vancouver in 2011 was great because I had never been there but always wanted to go.

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

Risk managers have to be more fluent and competent in the financial world. Just procuring insurance isn’t enough anymore. You have to have a basic level of financial knowledge to communicate with not only internal treasury and CFOs, but also with underwriters and insurers.

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

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Social engineering. The onslaught of fraudsters is relentless. Companies have to be vigilant. But the coverage surrounding that sort of risk is also emerging, so risk managers will have to pay close attention to that and keep up with that evolving coverage.

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

We had a major loss recently and there was a handful of insurers who paid on that claim which I thought were exceedingly professional: ACE (now Chubb), Ironshore and XL (now XL Catlin).

R&I: How much business do you do direct versus going through a broker?

We use a broker for everything.

R&I: Is the contingent commission controversy overblown?

It probably was a little bit overblown, but I think it’s good that things are more transparent now.

R&I: Are you optimistic about the U.S. economy or pessimistic and why?

I’m probably a little more pessimistic than optimistic. I just don’t see signs of strength out there. There are still companies with tons of cash outside the U.S. which can’t really bring it back in a way that makes sense. U.S. oil production is way down since the price of oil is so low.  Of course, the lower gas prices help the average consumer and lowers overhead costs for businesses, so it’s a little bit of a mixed bag.

R&I: Who is your mentor and why?

My mentor in this business is Joe Racansky. He was the director of risk management and my boss at CyTec Industries, and I learned as much from him as anybody in my career.

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

Successfully resolving claims stemming from the Lac-Megantic train derailment in 2013.

R&I: How many e-mails do you get in a day?

I’d say about 100.

R&I: How many do you answer?

All the important ones.

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

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Prime 112 in South Beach, Miami. It was the freshest tuna I’ve ever had, and it was with the team from Aon, so it was great food and great company.

R&I: What is your favorite drink?

Gin and tonic.

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

My favorite movie is “Bull Durham.” It’s a baseball movie.

R&I: Who’s your favorite baseball team?

The Cincinnati Reds.

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

Key West, Fla., is pretty interesting. My wife and I have been there a few times and you always see something different.

R&I: If the world has a modern hero, who is it and why?

I was moved by the Chris Kyle story. I thought his life and story were inspiring.

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

I think they think I just buy insurance, when it’s really more comprehensive than that. They don’t know about meeting with underwriters and contract review and working on M&A deals.




Katie Dwyer is an associate editor at Risk & Insurance®. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

R&I Profile

Achieving Balance

XL Catlin’s Denise Balan stays calm and focused when faced with crisis.
By: | January 10, 2018 • 6 min read

In the high-stress scenario of kidnap or ransom, the first image that comes to mind isn’t necessarily a yoga mat — at least, not for most.

But Denise Balan, senior VP and head of U.S. kidnap & ransom, XL Catlin, who practices yoga every day, would swear by it.

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“I looked at these opposing aspects of my life,” she said. “Yoga is about focus, balance, clarity of intent. In a moment of stress, how do you respond? The more clarity and calmness you maintain, the better positioned you are to provide assistance in moments of crisis.

“Nobody wants to be speaking to a frenetic person when either dealing with a dangerous situation or planning for prevention of a situation,” she added.

“There’s a poem by [Rudyard] Kipling on that,” added Balan’s colleague Ben Tucker. “What it boils down to is: If you can remain calm, you can manage through a crisis a lot better.”

Tucker, who works side by side with Balan as head of U.S. terrorism and political violence, XL Catlin, has seen how yoga influences his colleague.

“The way Denise interacts with stakeholders in this process — she is very professional and calm in the approach she takes.”

Yin and Yang

Sometimes seemingly opposite or contrary forces may actually be complementary and interconnected. In Balan’s life, yoga and K&R have become her yin and yang.

She entered the insurance world after earning a juris doctor degree and practicing law for a few years. The switch came, she said, when Balan realized she wasn’t enjoying her time as a commercial litigator.

Denise Balan, senior VP and head of U.S. kidnap & ransom, XL Catlin

In her new role, she was able to use her legal background to manage litigation at AIG, where her transition from law to insurance took place. She started her insurance career in the environmental sector.

In a chance meeting in 2007, Balan met with crisis management underwriters who told her about kidnap and ransom products.

She was hooked.

Because of her background in yoga, Balan liked the crisis management side of the job. Being able to bring the calmness and clearness of intent she practiced during yoga into assisting clients in planning for crisis management piqued her interest.

She then joined XL Catlin in July 2013, where she built the K&R team.

As she became more immersed in her field, Balan began to notice something: The principles she learned in yoga were the same principles ex-military and ex-law enforcement practiced when called to a K&R-related crisis.

She said, “They have a warrior mentality — focus, purpose, strength and logic — and I would say yoga is quite similar in discipline.”

“K&R responders have a warrior mentality — focus, purpose, strength and logic — and I would say yoga is quite similar in discipline.” — Denise Balan, senior VP and head of U.S. kidnap & ransom, XL Catlin

Many understand yoga to be, in itself, one type of meditation, but yoga actually encompasses a group of physical, mental and spiritual practices. Each is a discipline. Some forms of yoga focus on movement and breathing, others focus on posture and technique. Some yoga is meant to relax the mind and create a sense of calmness; other yoga types make participants sweat.

After having her second child and working full-time, Balan wanted to find something physical and relaxing for herself; a friend suggested yoga. During her first lesson, Balan said she was enamored with it.

“I felt like I’d done it all my life.”

She dove into the philosophy of yoga, adopting the practice into her daily routine. Every morning, whether Balan is in her Long Island home or on a business trip, she pulls out her yoga mat to practice.

“I always travel with my mat,” she said. “Daily practice is the simplest form of connection to routine to maintain my balance — physically and mentally.”

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She said the strangest place she has ever practiced was in Lisbon. She was on a very narrow balcony with a bird feeder swarming with sparrows overhead.

After years of studying and practicing, Balan is considered a yogi — someone who is highly proficient in yoga. She attends annual retreats with her yoga group, where she is able to rejuvenate, ready to tackle any K&R event when she returns.

In 2016, Balan visited Tuscany, Italy, where she learned the practice of yoga nidra, a very deep form of meditation. It’s described as the “going-to-sleep stage” — a type of yoga that brings participants to a state of consciousness between waking and sleeping.

“It awakens a different part of your brain,” Balan commented. “Orally describing it doesn’t quite do it justice. One has to practice Nidra to fully understand the effect it has on your being.”

Keeping a level head during a crisis is key in their line of business, Tucker said. He can attest to the benefit of having a yogi on board.

“I’ve seen her run table-top exercises where there is this group of people in a room and they run an exercise, a simulation of a kidnap incident. Denise is very committed to what we’re doing,” said Tucker.

“She brings that energy. She doesn’t get flustered by much.”

Building a K&R Program

When Balan joined XL Catlin, she was tasked with creating the K&R team.

Balan during a retreat in Sicily, Italy, 2017

She spent time researching and analyzing what clients would want in their K&R coverage. What stuck out most to Balan was the fact that, in these situations, the decision to purchase kidnap and ransom cover is rarely made because of desire for reimbursement of money.

“I asked why people buy this type of coverage. The answer was for the security responders,” she said.

“These are the people who sit with the family. They’re similar to psychologists or priests,” Balan further explained. “Corporations can afford to pay ransom. They buy [K&R] because it gives them access to these trained and dedicated professionals who not only provide negotiation advice, but actually sit with a victim’s family, engaging deep levels of emotional investment.”

“I’ve learned to appreciate all moments in life — one at a time. The ability to think clearly and calmly guides my work, my practice and my personal life.” — Denise Balan, senior VP and head of U.S. kidnap & ransom, XL Catlin

Balan described these responders as people having total clarity of purpose, setting their intentions to resolve a crisis — a practice at the very heart of yoga. She knew XL Catlin’s new kidnap program would put stock in their responders.

“I’ve worked closely with the responders to better understand what they can do for our clientele. These are the people who run into danger — warrior hearts married to dedication to our clients’ best interests.”

But K&R is more than fast-paced crisis and quick thinking; Balan also spent a good deal of time writing the K&R form and getting the company’s resources in order. This was a huge task to tackle when creating the program from the ground up.

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“A lot of my day-to-day is speaking with brokers and finding ways to enhance our product,” she said.

After a few months, she was able to hire the company’s first K&R underwriter. From there, the program has grown. It’s left her feeling professionally rewarded.

“People don’t often get that opportunity to build something up from scratch,” she said. “It’s been an amazing experience — rewarding and fun.”

“She brings groups of people together,” said Tucker. “She’s created a positive environment.”

Balan’s yogi nature extends beyond the office walls, too. Her pride and joy, she said, are her kids. And while it may seem like two large parts of her life are opposite in nature, Balan’s achieved balance through her passions.

“[Yoga] has given me the ability to see beyond only one aspect of any situation” she said. “I’ve learned to appreciate all moments in life — one at a time. The ability to think clearly and calmly guides my work, my practice and my personal life.” &

Autumn Heisler is a staff writer at Risk & Insurance. She can be reached at [email protected]