Sponsored Content by QBE

Shaking Up the Professional Liability Market

Not all new entrants to an insurance market are created equal.
By: | May 1, 2014 • 4 min read


In the case of QBE North America, a subsidiary of Australia’s QBE Group, the company is moving into the management liability and professional lines (MLPL) space as part of its shift towards becoming a more specialized commercial insurer.

QBE Group is ranked among the top 20 of the world’s largest P&C insurers. In 2013, QBE had gross written premium of $18 billion and 16,000-plus employees spread across 43 countries. When QBE launched its North American operations in 1991, the focus was on quickly building an operation that will support clients for decades to come. That philosophy still drives QBE North America today.

“People unfamiliar with QBE think of us as a startup, but we are very far from a startup,” says Dennis Kearns, senior vice president at QBE North America. “We came into the North American [management and professional liability] space armed with global scale and coupled it with extensive local expertise. This scale and investment in experience provided the platform for building our organization quickly.”

QBE North America’s management liability & professional lines group is a prime example of how marshalling the resources to meet a tremendous opportunity are fueling rapid and robust growth. Having entered the MLPL market less than a year ago, the group is already poised to have a significant impact on the professional liability space.

Kearns breaks down the success factors of the MLPL group into three key areas — commitment, clarity and experience.

Primary coverage demonstrates long-term commitment

While QBE North America’s MLPL business will offer excess coverage, the best measure of the company’s market commitment is its plan to offer a full range of primary coverages, including commercial errors and omissions and directors’ and officers’ liability for all types of customers — from public to private companies and not-for-profits to financial institutions.

By July, when QBE completes its rollout, it will represent the quickest route ever to being a primary MLPL insurance provider in the North American market. From the start, that will mean the number of true competitors will be significantly reduced, because while there are plenty of excess markets, a select few provide primary coverage, and even fewer provide truly innovative products backed by global scale.

“The primary space is where you separate the companies that are here to stay versus those limited to excess only capacity,” Kearns said. “We realized from day one that if we were going to make a true difference, we had to establish QBE North America as a primary player.”

“The concept is to eliminate anything we regard as unnecessary. We have so much confidence in our underwriting team, we still can speak to an insured’s every need, but they won’t require a translator to figure it out.”

An unparalleled consistent, simple approach

Clarity and simplicity are not often used to describe the commercial insurance industry. To that end, QBE intends to shake things up with contract language and forms that focus on exactly those attributes.

For example, QBE retooled its excess form from two pages to a half page. For more complex primary coverages, it took 30-page forms and reduced them to less than 10.


This is the entire length of QBE’s excess insurance form (short version).

“The concept is to eliminate anything we regard as unnecessary,” Kearns said. “We have so much confidence in our underwriting team, we still can speak to an insured’s every need, but they won’t require a translator to figure it out.”

When it comes to its policy simplicity and clarity, QBE believes it is unique. Best of all, those two features will be consistent in all QBE contracts — all will look similar down to the construction of insuring clauses, creating an immediate comfort level with both buyers and brokers.

QBE’s clarity and consistency are powerful differentiators that set it apart from other insurers.

Top talent – and lots of it

The QBE professionals working in claims and underwriting include some of the most talented executives in the industry. The company’s focus is not only on hiring the best but also in creating large teams that can support the growth objectives for the long-term. For example, the MLPL underwriting team already is staffed by 20 top professionals with several hundred years of cumulative experience in the liability business throughout North America and abroad.

On the claims side, QBE focuses on a business-driven approach that reduces the tendency for “over-lawyering” that can cause problems in delivering swift, fair claim responses.

Key members of the QBE North America MLPL team include:

Jeff Grange
SponsoredContent_QBEPresident, Specialty Insurance
[email protected]

Jeff joined QBE North America in 2013 to lead the development of its Specialty Business Group. In this role Jeff reports to David Duclos, Chief Executive Officer. Jeff also serves as Chairman of the North American Underwriting Committee. Jeff has more than 25 years of insurance experience and previously served as the Chairman of the Group Underwriting Committee and Global Practice Leader for Management Liability & Professional Lines at Torus Insurance. He spent more than 21 years with the Chubb Group of Insurance Companies where he was a Senior Vice President and worldwide manager for their professional liability businesses.

Craig Grant
SponsoredContent_QBESVP, Head of Private Company Management Liability
Direct: 860-408-5547
[email protected]

Craig joined QBE North America in October 2013 to lead the Private Company effort within Management Liability & Professional Lines. Craig has 20 years of insurance experience in underwriting. Craig joined QBE from Torus Insurance where he led the Private Company Management Liability team. Previously, he was an Executive Underwriter for the Chubb Group of Insurance Companies and held various underwriting and producer management roles. Craig earned a B.A. in Political Science from Assumption College.

Michael Phillips
SponsoredContent_QBESVP, Head of Commercial E&O
Direct: 646-341-8024
[email protected]

Mike joined QBE in October 2013 to develop and build out QBE’s commercial E&O products in the U.S. Mike has more than 24 years of underwriting experience in various lines of professional liability. He joins QBE from Torus where he was responsible for commercial E&O products in the U.S. Prior to Torus, Mike worked at Chubb, where he was the Worldwide MPL Product Manager responsible for setting the specific underwriting guidelines, as well as overseeing the growth and profitability of the worldwide book since 2004. Mike earned a B.A. from the University of Maryland and an M.B.A from George Washington University.

Sharon Raksnis
SponsoredContent_QBESVP, Head of Financial Institutions
Direct: 212-894-7893
[email protected]

Sharon joined QBE North America from Torus Insurance to lead the Financial Institutions effort within Management Liability & Professional Lines. Sharon has more than 25 years of Insurance experience in both underwriting and brokerage, and is a leading expert in Directors & Officers Liability, Professional Liability, Employment Practices Liability, Fiduciary Liability and FI Bond. Sharon is a graduate of Yale University, where she received a B.A. in Economics.

Dennis Kearns
SponsoredContent_QBESVP, Underwriting Counsel
Direct: 646-341-8022
[email protected]

Dennis is responsible for all management liability and professional lines products across the Public Company, Private Company, Financial Institution, Commercial E&O and Healthcare segments. Prior to joining QBE, Dennis was a Managing Director and Manager of the Claims Advocacy Group for Marsh FINPRO specializing in complex coverage and claims issues. Before joining Marsh, Dennis worked for Chubb including senior attorney for the specialty lines business unit. Dennis earned a J.D. from Seton Hall University School of Law and a B.S. in Marketing from Saint Peter’s College.

John Burkhart III
SponsoredContent_QBESVP, Head of Public Company Management Liability
Direct: 312-803-3513
[email protected]

John joined QBE North America to lead the Public Company segment within the Management Liability lines. John joined QBE from Chubb Specialty Insurance where he managed public and financial institution specialty business as Vice President and Northern Regional Manager. In previous roles at Chubb, John managed specialty for the UK & Ireland Region and the company’s worldwide portfolio of asset management- related products. John holds a B.S. degree in Finance from Western Michigan University.


This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with QBE North America. The editorial staff of Risk & Insurance had no role in its preparation.

QBE North America is a division of QBE Insurance Group Limited, one of the world's 20 largest insurance and reinsurance companies. We offer the unique integration of financial strength, a broad product set and sophisticated capabilities to deliver value for our partners and policyholders.

More from Risk & Insurance

More from Risk & Insurance

Exclusive | Hank Greenberg on China Trade, Starr’s Rapid Growth and 100th, Spitzer, Schneiderman and More

In a robust and frank conversation, the insurance legend provides unique insights into global trade, his past battles and what the future holds for the industry and his company.
By: | October 12, 2018 • 12 min read

In 1960, Maurice “Hank” Greenberg was hired as a vice president of C.V. Starr & Co. At age 35, he had already accomplished a great deal.

He served his country as part of the Allied Forces that stormed the beaches at Normandy and liberated the Nazi death camps. He fought again during the Korean War, earning a Bronze Star. He held a law degree from New York Law School.


Now he was ready to make his mark on the business world.

Even C.V. Starr himself — who hired Mr. Greenberg and later hand-picked him as the successor to the company he founded in Shanghai in 1919 — could not have imagined what a mark it would be.

Mr. Greenberg began to build AIG as a Starr subsidiary, then in 1969, he took it public. The company would, at its peak, achieve a market cap of some $180 billion and cement its place as the largest insurance and financial services company in history.

This month, Mr. Greenberg travels to China to celebrate the 100th anniversary of C.V. Starr & Co. That visit occurs at a prickly time in U.S.-Sino relations, as the Trump administration levies tariffs on hundreds of billions of dollars in Chinese goods and China retaliates.

In September, Risk & Insurance® sat down with Mr. Greenberg in his Park Avenue office to hear his thoughts on the centennial of C.V. Starr, the dynamics of U.S. trade relationships with China and the future of the U.S. insurance industry as it faces the challenges of technology development and talent recruitment and retention, among many others. What follows is an edited transcript of that discussion.

R&I: One hundred years is quite an impressive milestone for any company. Celebrating the anniversary in China signifies the importance and longevity of that relationship. Can you tell us more about C.V. Starr’s history with China?

Hank Greenberg: We have a long history in China. I first went there in 1975. There was little there, but I had business throughout Asia, and I stopped there all the time. I’d stop there a couple of times a year and build relationships.

When I first started visiting China, there was only one state-owned insurance company there, PICC (the People’s Insurance Company of China); it was tiny at the time. We helped them to grow.

I also received the first foreign life insurance license in China, for AIA (The American International Assurance Co.). To date, there has been no other foreign life insurance company in China. It took me 20 years of hard work to get that license.

We also introduced an agency system in China. They had none. Their life company employees would get a salary whether they sold something or not. With the agency system of course you get paid a commission if you sell something. Once that agency system was installed, it went on to create more than a million jobs.

R&I: So Starr’s success has meant success for the Chinese insurance industry as well.

Hank Greenberg: That’s partly why we’re going to be celebrating that anniversary there next month. That celebration will occur alongside that of IBLAC (International Business Leaders’ Advisory Council), an international business advisory group that was put together when Zhu Rongji was the mayor of Shanghai [Zhu is since retired from public life]. He asked me to start that to attract foreign companies to invest in Shanghai.

“It turns out that it is harder [for China] to change, because they have one leader. My guess is that we’ll work it out sooner or later. Trump and Xi have to meet. That will result in some agreement that will get to them and they will have to finish the rest of the negotiations. I believe that will happen.” — Maurice “Hank” Greenberg, chairman and CEO, C.V. Starr & Co. Inc.

Shanghai and China in general were just coming out of the doldrums then; there was a lack of foreign investment. Zhu asked me to chair IBLAC and to help get it started, which I did. I served as chairman of that group for a couple of terms. I am still a part of that board, and it will be celebrating its 30th anniversary along with our 100th anniversary.


We have a good relationship with China, and we’re candid as you can tell from the op-ed I published in the Wall Street Journal. I’m told that my op-ed was received quite well in China, by both Chinese companies and foreign companies doing business there.

On August 29, Mr. Greenberg published an opinion piece in the WSJ reminding Chinese leaders of the productive history of U.S.-Sino relations and suggesting that Chinese leaders take pragmatic steps to ease trade tensions with the U.S.

R&I: What’s your outlook on current trade relations between the U.S. and China?

Hank Greenberg: As to the current environment, when you are in negotiations, every leader negotiates differently.

President Trump is negotiating based on his well-known approach. What’s different now is that President Xi (Jinping, General Secretary of the Communist Party of China) made himself the emperor. All the past presidents in China before the revolution had two terms. He’s there for life, which makes things much more difficult.

R&I: Sure does. You’ve got a one- or two-term president talking to somebody who can wait it out. It’s definitely unique.

Hank Greenberg: So, clearly a lot of change is going on in China. Some of it is good. But as I said in the op-ed, China needs to be treated like the second largest economy in the world, which it is. And it will be the number one economy in the world in not too many years. That means that you can’t use the same terms of trade that you did 25 or 30 years ago.

They want to have access to our market and other markets. Fine, but you have to have reciprocity, and they have not been very good at that.

R&I: What stands in the way of that happening?

Hank Greenberg: I think there are several substantial challenges. One, their structure makes it very difficult. They have a senior official, a regulator, who runs a division within the government for insurance. He keeps that job as long as he does what leadership wants him to do. He may not be sure what they want him to do.

For example, the president made a speech many months ago saying they are going to open up banking, insurance and a couple of additional sectors to foreign investment; nothing happened.

The reason was that the head of that division got changed. A new administrator came in who was not sure what the president wanted so he did nothing. Time went on and the international community said, “Wait a minute, you promised that you were going to do that and you didn’t do that.”

So the structure is such that it is very difficult. China can’t react as fast as it should. That will change, but it is going to take time.

R&I: That’s interesting, because during the financial crisis in 2008 there was talk that China, given their more centralized authority, could react more quickly, not less quickly.

Hank Greenberg: It turns out that it is harder to change, because they have one leader. My guess is that we’ll work it out sooner or later. Trump and Xi have to meet. That will result in some agreement that will get to them and they will have to finish the rest of the negotiations. I believe that will happen.

R&I: Obviously, you have a very unique perspective and experience in China. For American companies coming to China, what are some of the current challenges?


Hank Greenberg: Well, they very much want to do business in China. That’s due to the sheer size of the country, at 1.4 billion people. It’s a very big market and not just for insurance companies. It’s a whole range of companies that would like to have access to China as easily as Chinese companies have access to the United States. As I said previously, that has to be resolved.

It’s not going to be easy, because China has a history of not being treated well by other countries. The U.S. has been pretty good in that way. We haven’t taken advantage of China.

R&I: Your op-ed was very enlightening on that topic.

Hank Greenberg: President Xi wants to rebuild the “middle kingdom,” to what China was, a great country. Part of that was his takeover of the South China Sea rock islands during the Obama Administration; we did nothing. It’s a little late now to try and do something. They promised they would never militarize those islands. Then they did. That’s a real problem in Southern Asia. The other countries in that region are not happy about that.

R&I: One thing that has differentiated your company is that it is not a public company, and it is not a mutual company. We think you’re the only large insurance company with that structure at that scale. What advantages does that give you?

Hank Greenberg: Two things. First of all, we’re more than an insurance company. We have the traditional investment unit with the insurance company. Then we have a separate investment unit that we started, which is very successful. So we have a source of income that is diverse. We don’t have to underwrite business that is going to lose a lot of money. Not knowingly anyway.

R&I: And that’s because you are a private company?

Hank Greenberg: Yes. We attract a different type of person in a private company.

R&I: Do you think that enables you to react more quickly?

Hank Greenberg: Absolutely. When we left AIG there were three of us. Myself, Howie Smith and Ed Matthews. Howie used to run the internal financials and Ed Matthews was the investment guy coming out of Morgan Stanley when I was putting AIG together. We started with three people and now we have 3,500 and growing.

“I think technology can play a role in reducing operating expenses. In the last 70 years, you have seen the expense ratio of the industry rise, and I’m not sure the industry can afford a 35 percent expense ratio. But while technology can help, some additional fundamental changes will also be required.” — Maurice “Hank” Greenberg, chairman and CEO, C.V. Starr & Co. Inc.

R&I:  You being forced to leave AIG in 2005 really was an injustice, by the way. AIG wouldn’t have been in the position it was in 2008 if you had still been there.


Hank Greenberg: Absolutely not. We had all the right things in place. We met with the financial services division once a day every day to make sure they stuck to what they were supposed to do. Even Hank Paulson, the Secretary of Treasury, sat on the stand during my trial and said that if I’d been at the company, it would not have imploded the way it did.

R&I: And that fateful decision the AIG board made really affected the course of the country.

Hank Greenberg: So many people lost all of their net worth. The new management was taking on billions of dollars’ worth of risk with no collateral. They had decimated the internal risk management controls. And the government takeover of the company when the financial crisis blew up was grossly unfair.

From the time it went public, AIG’s value had increased from $300 million to $180 billion. Thanks to Eliot Spitzer, it’s now worth a fraction of that. His was a gross misuse of the Martin Act. It gives the Attorney General the power to investigate without probable cause and bring fraud charges without having to prove intent. Only in New York does the law grant the AG that much power.

R&I: It’s especially frustrating when you consider the quality of his own character, and the scandal he was involved in.

In early 2008, Spitzer was caught on a federal wiretap arranging a meeting with a prostitute at a Washington Hotel and resigned shortly thereafter.

Hank Greenberg: Yes. And it’s been successive. Look at Eric Schneiderman. He resigned earlier this year when it came out that he had abused several women. And this was after he came out so strongly against other men accused of the same thing. To me it demonstrates hypocrisy and abuse of power.

Schneiderman followed in Spitzer’s footsteps in leveraging the Martin Act against numerous corporations to generate multi-billion dollar settlements.

R&I: Starr, however, continues to thrive. You said you’re at 3,500 people and still growing. As you continue to expand, how do you deal with the challenge of attracting talent?

Hank Greenberg: We did something last week.

On September 16th, St. John’s University announced the largest gift in its 148-year history. The Starr Foundation donated $15 million to the school, establishing the Maurice R. Greenberg Leadership Initiative at St. John’s School of Risk Management, Insurance and Actuarial Science.

Hank Greenberg: We have recruited from St. John’s for many, many years. These are young people who want to be in the insurance industry. They don’t get into it by accident. They study to become proficient in this and we have recruited some very qualified individuals from that school. But we also recruit from many other universities. On the investment side, outside of the insurance industry, we also recruit from Wall Street.

R&I: We’re very interested in how you and other leaders in this industry view technology and how they’re going to use it.

Hank Greenberg: I think technology can play a role in reducing operating expenses. In the last 70 years, you have seen the expense ratio of the industry rise, and I’m not sure the industry can afford a 35 percent expense ratio. But while technology can help, some additional fundamental changes will also be required.

R&I: So as the pre-eminent leader of the insurance industry, what do you see in terms of where insurance is now and where it’s going?

Hank Greenberg: The country and the world will always need insurance. That doesn’t mean that what we have today is what we’re going to have 25 years from now.

How quickly the change comes and how far it will go will depend on individual companies and individual countries. Some will be more brave than others. But change will take place, there is no doubt about it.


More will go on in space, there is no question about that. We’re involved in it right now as an insurance company, and it will get broader.

One of the things you have to worry about is it’s now a nuclear world. It’s a more dangerous world. And again, we have to find some way to deal with that.

So, change is inevitable. You need people who can deal with change.

R&I:  Is there anything else, Mr. Greenberg, you want to comment on?

Hank Greenberg: I think I’ve covered it. &

The R&I Editorial Team can be reached at [email protected]