Risk Insider: Robert Rheel

Keeping Wholesale Distribution Relevant

By: | May 7, 2014 • 2 min read

Robert Rheel has more than 30 years of insurance industry experience. He was appointed president of Aspen U.S. Insurance in August 2015, prior to which he served as head of U.S. property & casualty insurance and programs and head of customer, distribution and marketing.

Change is inevitable — particularly in insurance.

New risks emerge, the marketplace changes and insurance products evolve to meet ever-changing customer needs.  Yet distribution channels — wholesale in particular — have remained largely unchanged. Does this distribution channel need to catch up and modernize?

I believe wholesalers provide real value to specialty insurance carriers and retail insurance agents and brokers.  But the wholesale distribution channel desperately needs to evolve with a focus on innovation, the development of new products to meet changing customer demands, and the delivery of complex risk expertise, knowledge and access to the specialty market that only they can provide to large segments of our business.

What is driving this need for change?

Wholesalers account for 70 percent of the surplus lines premium placed, with surplus lines growing faster in recent years than standard commercial lines at 11.8 percent vs 4.3 percent in 2012 (AM Best Surplus Lines Report).  But today, the wholesale market is under increased pressure.

First, current market conditions are driving business to E&S (excess and surplus lines) from standard markets, a trend that I see accelerating, as standard lines are non-renewing more complex and specialty risks. 

Second, there is an increased squeeze on wholesalers from retailers and carriers.  Retailers are looking for a greater share of revenue by reducing the use of wholesalers or consolidating the number of wholesalers they use in the placement process.   And carriers are seeking higher underwriting profits to make up for lower investment income in this interest rate environment.

And lastly, consolidation affects the market with the number of wholesale branch offices down 10% in recent years (AM Best Surplus Lines Report).  Fewer players could cause a competitive disadvantage and potentially limit market access and overall placement success.

What would an evolved wholesale model look like?

I see today’s wholesaler morphing into a specialty products channel.  In this new model, wholesalers would continue to develop expertise in specialty segments that retail brokers and customers would value.

There are four major benefits of this model:

1) Reduced Costs:  For smaller retailers, they would not have to invest in specialty lines placement expertise and for specialty insurers, they can reduce costs by utilizing a targeted distribution footprint

2) Increased Access:  It would provide smaller retailers better access to specialty carriers. It would also provide greater access to global capital markets and global insurance capital to provide stable, innovative solutions for both retailers and customers

3) Improved Placement and Distribution: It would create more efficient and effective distribution of specialty products by aggregating retailers to give carriers better access to a wider number of brokers.  It would also improve and position appetites of specialty carriers to solicit a changing mix of business with more non-E&S business.

4) Additional Business:  It would open new E&S business for wholesalers.

I believe the wholesale distribution channel brings great value — but it needs to evolve with the changing insurance industry.  The wholesale channel needs to become the specialty products channel.

Company Disclaimer: The above article/opinion reflects the opinion of the author and does not necessarily represent Aspen’s views.  The article reflects the opinion of the author at the time it was written taking into account market, regulatory and other conditions at the time of writing which may change over time.  Aspen does not undertake a duty to update these articles.

4 Companies That Rocked It by Treating Injured Workers as Equals; Not Adversaries

The 2018 Teddy Award winners built their programs around people, not claims, and offer proof that a worker-centric approach is a smarter way to operate.
By: | October 30, 2018 • 3 min read

Across the workers’ compensation industry, the concept of a worker advocacy model has been around for a while, but has only seen notable adoption in recent years.

Even among those not adopting a formal advocacy approach, mindsets are shifting. Formerly claims-centric programs are becoming worker-centric and it’s a win all around: better outcomes; greater productivity; safer, healthier employees and a stronger bottom line.


That’s what you’ll see in this month’s issue of Risk & Insurance® when you read the profiles of the four recipients of the 2018 Theodore Roosevelt Workers’ Compensation and Disability Management Award, sponsored by PMA Companies. These four programs put workers front and center in everything they do.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top,” said Steve Legg, director of risk management for Starbucks.

Starbucks put claims reporting in the hands of its partners, an exemplary act of trust. The coffee company also put itself in workers’ shoes to identify and remove points of friction.

That led to a call center run by Starbucks’ TPA and a dedicated telephonic case management team so that partners can speak to a live person without the frustration of ‘phone tag’ and unanswered questions.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top.” — Steve Legg, director of risk management, Starbucks

Starbucks also implemented direct deposit for lost-time pay, eliminating stressful wait times for injured partners, and allowing them to focus on healing.

For Starbucks, as for all of the 2018 Teddy Award winners, the approach is netting measurable results. With higher partner satisfaction, it has seen a 50 percent decrease in litigation.

Teddy winner Main Line Health (MLH) adopted worker advocacy in a way that goes far beyond claims.

Employees who identify and report safety hazards can take credit for their actions by sending out a formal “Employee Safety Message” to nearly 11,000 mailboxes across the organization.

“The recognition is pretty cool,” said Steve Besack, system director, claims management and workers’ compensation for the health system.

MLH also takes a non-adversarial approach to workers with repeat injuries, seeing them as a resource for identifying areas of improvement.

“When you look at ‘repeat offenders’ in an unconventional way, they’re a great asset to the program, not a liability,” said Mike Miller, manager, workers’ compensation and employee safety for MLH.

Teddy winner Monmouth County, N.J. utilizes high-tech motion capture technology to reduce the chance of placing new hires in jobs that are likely to hurt them.

Monmouth County also adopted numerous wellness initiatives that help workers manage their weight and improve their wellbeing overall.

“You should see the looks on their faces when their cholesterol is down, they’ve lost weight and their blood sugar is better. We’ve had people lose 30 and 40 pounds,” said William McGuane, the county’s manager of benefits and workers’ compensation.


Do these sound like minor program elements? The math says otherwise: Claims severity has plunged from $5.5 million in 2009 to $1.3 million in 2017.

At the University of Pennsylvania, putting workers first means getting out from behind the desk and finding out what each one of them is tasked with, day in, day out — and looking for ways to make each of those tasks safer.

Regular observations across the sprawling campus have resulted in a phenomenal number of process and equipment changes that seem simple on their own, but in combination have created a substantially safer, healthier campus and improved employee morale.

UPenn’s workers’ comp costs, in the seven-digit figures in 2009, have been virtually cut in half.

Risk & Insurance® is proud to honor the work of these four organizations. We hope their stories inspire other organizations to be true partners with the employees they depend on. &

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]