Succeeding Through Persistence
In the face of a client’s poor loss history, consistent premium increases and a reactionary market, Alliant’s Ashley De Paola showed that persistence is often the key to success.
One developer of affordable family and senior housing in New York, for example, suffered significant fire losses and premiums rising from $150,000 to $600,000 over the course of several years.
De Paola was charged with finding a more affordable and comprehensive solution. After an initial rejection from one carrier, she went back to them armed with additional data on the company’s properties — including copies of housing inspections and positive newspaper articles about their respective neighborhoods — that won the insurer over.
She also presented clear and detailed plans about the company’s efforts to mitigate future fire losses. She was ultimately able to secure broader coverage and lower deductibles, prompting the developer to drop their previous broker.
For Connecticut-based Carabetta Management Co., “Ashley renewed our property program at the end of 2015 for more than 100 owners through a layered property program. It was a very creative program that actually saved each owner 17 percent,” according to risk manager Jean Fanelli.
Fanelli also attested to De Paola’s customer service, saying De Paola is always the first to respond to any email sent to her entire team. “She works tirelessly servicing our account, often until midnight,” she said.
Leveraging Market Relationships
Keeping tabs on the pulse of the market and maintaining relationships with carriers can make or break a broker’s success. Brian Dougal, leader of Aon’s western region property practice, has been able to deliver where other brokers failed by leveraging those valued relationships and forging new ones.
“Brian Dougal helped orchestrate an effective property solution for our affiliates and worked it into a full-fledged program, a structured tower of insurance for our property program, which our previous broker had never been able to do,” said Doug Bell, president, RepWest Insurance Co.
“We went from 0 to 70 percent participation from Lloyd’s of London.”
Josh Frieman, principal at real estate investment firm Prime Group, said that at a 2015 Aon property symposium, “Brian introduced us to many new markets and extended our relationships with markets that we already knew. He deftly created competition among the markets for our business and ultimately exceeded our expectations with our 2015 renewal.”
Dougal also serves as an educator for his clients, preparing them for how carriers might perceive their risk exposures, and how to calm their fears. He has helped clients differentiate themselves in the market by building portfolios and arranging site visits that demonstrate a property’s strengths and highlight his clients’ “best in class” management skills.
His efforts have led at least two of his clients to switch their allegiance to Aon from other major brokers in the past year.
Artfully Covering Gaps
Construction projects have many risk complexities, especially when the work is taking place around works of art, as was the case when Gallagher’s Justin Dove helped cover the San Francisco Museum of Modern Art’s expansion.
“He not only guided the museum through the appropriate insurance requirements for standard vendor agreements and independent contractor forms, he also helped ensure general contractor and subcontractor enrollment in the Owner Controlled Insurance Program (OCIP) as part of the new museum building project,” said Adine Varah, general counsel for the museum.
Explaining those complexities to clients can be considered an art form in itself.
“He is exceptionally knowledgeable as well as patient with his explanations to me, my colleagues, my attorney and third parties I am negotiating with,” said Thomas Lauderbach, senior project manager, Tenderloin Neighborhood Development Corp (TNDC).
The corporation’s previous insurance program excluded coverage for any renovation or rehab, but it had six such projects in the planning phase. Dove built an OCIP for them that allowed them to add new projects in the future as they became necessary.
Dove has also leveraged the full range of AJG services to pull in new business. A chance meeting at a conference with a small nonprofit led Dove to complete a full analysis of their program. He found inconsistencies and offered to round out their coverage, saving them $22,000, said Jennifer Duffy, director of business development, Hello Housing.
Tapping Into Creative Juices
Creativity means coloring outside of the lines and breaking from the expected. This is what Dominic Gallina does for his clients, going abroad for products that haven’t hit the U.S. market, and seeking innovative solutions where no product exists at all.
The key to finding out-of-the-box coverage is understanding the nuances of each client’s needs and goals. One affordable housing developer, for example, sought to build to a higher environmentally sustainable standard but had fewer resources to work with than a developer of market-rate housing.
Still, Gallina was able to secure new coverages for “green” building improvements, demolition/ICC coverage for code, law and regulation changes post-loss, and communicable disease business interruption coverage.
Fostering direct relationships between insured and insurer has also helped build mutual trust and facilitated his efforts to place broader coverage at lower rates.
“I think this is very unusual in the risk management space. Too often brokers want to keep those parts of the world separate, but in this instance it made for a deeper partnership between insurer and insured,” said Adam Weinstein, president and CEO of Phipps Houses, a nonprofit affordable housing developer in New York.
Gallina also has a way with words.
“He strengthens our policy language to get rid of ambiguity, keeping costs down while increasing scope of coverage,” said Lee Roth, CFO for the Sentinel Real Estate Corp.
Making the Case to Carriers
Developers of large residential properties face a higher level of risk than other types of real estate owners, and getting underwriters on board can be especially challenging after a loss has occurred.
One client of Blake Giannisis suffered a major fire in a large apartment complex just months before renewal, worsening prospects already made challenging by carriers’ increasing inclination to ease out of residential property programs.
Giannisis turned to the reinsurance market and expanded sidecar arrangements to bolster the developer’s own captive, and brought in new carriers to foster competition.
For another client with a New York City property, Giannisis got ahead of prospective insurers’ questions and hesitations, taking their representatives on tours of the clients’ facilities to demonstrate safety and other risk mitigation measures that had been taken to defend against flooding and terrorism risk.
He reviewed construction progress reports and floor plans with carriers to make them more comfortable with the level of risk and was able to secure competitive pricing for coverage.
For one Lower Manhattan office space, he was able to get multiple insurers on a program to agree to provide terrorism coverage, even during the lapse in TRIPRA’s effective dates.
One risk manager for a prominent hotel chain praised Giannisis and his team for helping the chain to be “viewed as a premier management company with a great risk management and insurance product for hotel owners that is rarely duplicated elsewhere.”
Delivering With Speed and Efficiency
Power Brokers are often distinguished by their industry expertise; understanding a client’s business allows them to obtain more specialized coverage with fewer gaps and exposures at the most appropriate price.
Clients of Michael Walsh, real estate service group leader, unilaterally agree that he knows the property business so well he can predict where future problems may arise.
“While Mike listens to our issues he automatically shifts his thinking and explains the issues we believe we have may actually be something else. He is always a couple of steps ahead,” said Randy Krichbaum, director of risk management and claims for McKinley Inc.
One real estate investment company had a third party client — who owned half of the company’s assets — pull out completely from an insurance program less than a month after renewal, Walsh renegotiated payment terms with the multiple carriers involved so that the client’s cash flow and profitability were not impacted.
For Donna Dernar, Risk Manager for financial services company TIAA-CREF, Walsh is an extension of her Global Real Estate Risk Management department and has dealt directly with property managers, lenders, loan servicers, legal counsel and other third parties as needed to assist TIAA’s Insurance Services.
“Michael is very knowledgeable of insurance coverages and skilled in data management, integration and design as he has constructed our very complex premium allocation matrix that allows us to provide pro-rata and annual premium estimates for our due diligence teams. He also manages over 2,000 lines of property data for RMS Catastrophic Modeling annually. Mike delivers excellence customer service which is a critical differentiator for our business,” she said.