Rising Star Taylor Manders Shares How She’s Helping Clients Improve Their Property Valuations
Come see the Stars! As part of our ongoing coverage of the best brokers in the commercial insurance space, Risk & Insurance®, with the sponsorship of Philadelphia Insurance, is expanding its coverage of the Rising Stars — those brokers who represent the next wave of insurance brokering talent.
Look for these expanded profiles on the Risk & Insurance website and in your social media feeds throughout the year.
Here’s our conversation with Taylor Manders, senior broker at Aon, and a 2022 Agriculture Power Broker winner and Rising Star.
Risk & Insurance: We’ve been hearing about the challenges brokers are facing when seeking property insurance options for their clients. As a senior property broker, how are you advising your clients to put their best foot forward for renewals?
Taylor Manders: I make sure my clients are well versed on what is happening in the property marketplace and work closely with them to develop their broking story, putting their best foot forward to the markets.
With the firm property market, it is essential to get out early enough so that we can evaluate all options and figure out the best program structure and carrier partners. Right now, the biggest challenges in the marketplace are cost of reinsurance, valuation, and increased pressure on rate.
When it comes to the reinsurance marketplace, it boils down to the current demand for Nat CAT reinsurance protection exceeding the current supply. In Q1 2023, treaty reinsurance renewals saw significant rate increases (40% or more), increased retentions, and terms restrictions/capacity reductions.
This is further driving rate pressure, especially for accounts that are Nat CAT exposed. While increased reinsurance costs are top of mind for all primary insurers, they have not lost sight of the importance of accurate values. We have seen many recent claims where the losses exceed reported values.
This, along with increased cost of materials, record high inflation and having supply chain disruption has caused us to have more conversations around the adequacy on reported values. We work with our consulting experts to make sure the client’s values reported are accurate, which provides us another leverage tool within the marketplace.
To mitigate further rate pressure, I make sure we are evaluating all options with our clients, including increased retentions, captive utilization, evaluating Nat CAT limits with updated COPE information after modeling, and vetting other risk alternative transfers such as parametric options.
It’s important that clients understand the backstory of the marketplace we are in. It’s not necessarily their risk causing these large rate increases, so they need to realize other market factors are prevalent.
R&I: Can you tell us about the COPE information-gathering process you’ve used recently with some of your clients? What kinds of organizations, in your opinion, really benefit from going through this exercise?
TM: COPE [construction, occupancy, protection and exposures] is the basic property information needed to place a risk effectively, and the more information we have, the better.
When starting to work with a national restaurant chain back in 2017, we got consistent feedback from the markets about the lack of COPE information. At the time, the program stood as a California-only earthquake program. With the goal of eventually building this program out to a national all-risk program, we knew we needed more data.
In 2019, we worked with engineering to develop a COPE info-gathering project that enabled us to hit many locations in a single day, without any business interruption, utilizing our drone capabilities. We were able to complete all of California in a few months and have now expanded the project to the entire U.S.
The updated COPE information allowed us to confirm the client is buying adequate Nat CAT limits and expand the earthquake program beyond California.
There were many different benefits to using drones to gather this information; it cut down on potential business interruption in the day-to-day, reduced overall expenses, and was time effective given the number of locations.
Many different organizations are looking to gather essential COPE data in an effective manner [and] would benefit from an exercise like this.
R&I: Parametric insurance was one of the solutions you mentioned in your Power Broker application among the alternative risk transfer options you often discuss with your clients. In the food and agriculture space, in particular, what could be the benefits to including parametric solutions in an organization’s risk strategy?
TM: It is a new, hot topic in the marketplace right now that I make sure to bring to the forefront of my clients. Parametric insurance addresses the protection gap that a traditional insurance placement might not — such as business interruption exposure and the need for cash in a crisis.
If the event occurs and meets the trigger, the payment is issued almost immediately. For companies heavily dependent on intangible assets like the resiliency of their employees or third party supply chains, parametric solution can address the expenses needed to maintain operations quickly.
Although parametrics are still new, it’s beneficial to understand another alternative risk solution. I think we’ll see more and more parametrics in the future.
R&I: Aside from property coverage dilemmas, what are some other areas of risk that you’re keeping an eye on for your food and agriculture clients?
TM: Outside of the key items already mentioned, contingent business interruption coverage and risk engineering focus come top of mind, especially for any food related accounts. There were concerns around an already vulnerable supply chain, and after the pandemic, there is added focus on monitoring contingent business interruption exposure.
Over the past couple of years, we’ve seen an increase in large losses particularly in the food manufacturing/warehousing space, which has led to increased pressure around risk quality. Working alongside our engineers, we make sure the client understands the engineering recommendations and their potential exposure, and work to get responses where necessary. The times of ignoring engineering recommendations year after year are behind us.
R&I: In your Power Broker narrative, you mentioned the value of your time working with an insurance carrier prior to becoming a broker. Is that a path you would recommend to someone, say a recent college grad, take if they’re unsure where to begin their risk and insurance journey?
TM: When I went to college, I knew I wanted to be in business. I had a scholarship for marketing, but I didn’t really know what I wanted to do.
My sophomore year at Appalachian State University, I remember hearing about this new major — risk management and insurance [RMI]. We had professors telling us about all of the incredible opportunities. As we were facing a generational bubble, [RMI majors had] 95% job placement before you graduate; making over X amount of money; only taking a couple of additional business classes. It almost sounded too good to be true.
I decided to start the double major my junior year and became very involved in the RMI program. I was able to gain internship experience and even travel to London before I graduated. I left feeling very prepared to start my career.
I have always been very social, so I knew that down the line I wanted to be a broker. But I also knew that in order to be a successful broker, I needed to understand what went into evaluating and pricing a risk.
For the first two years of my career, I really focused on learning each line of business and understanding the ins and outs of how an underwriter’s brain works. Now, when I take a risk to market, I can anticipate what the markets are looking for, and am able to get ahead of it in order to place a risk effectively. I would recommend this path to anyone who is unsure where to begin in this industry. &