Insurance Industry

The Spirit of Giving

An insurance carrier partners with an international foundation to save lives and build community in Central Uganda.
By: | October 15, 2014 • 7 min read

By September of 2013, Aspen Insurance CEO Mario Vitale was a 37-year veteran of the insurance industry and a successful one at that.

All it took was one week visiting the village of Kiwoko, in Central Uganda for Vitale, back at home in New York, to wonder what he was doing with his life.

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“I remember putting a tie on and looking at myself in the mirror and somehow everything I do every day, which I love — the insurance business — didn’t seem as important anymore,” Vitale recalled.

That September, Vitale had acted as the lead ambassador for a group of Aspen staff members who visited Uganda as part of Aspen’s work with The Adara Group, formerly known as the ISIS Foundation.

The Group originated in 1998 with the goal of bringing medical and educational support to poor villages in Uganda and Nepal.

Every year since 2007, Aspen Insurance has made contributions to The Adara Group and a group of “Aspen Ambassadors,” numbering between seven and nine people, visits Kiwoko and spends time getting to know the village members Aspen’s contributions help to support.

Video: This video from The Adara Group describes some of the work it has done in Nepal and Uganda.

To date, Aspen has contributed a substantial amount to The Adara Group’s efforts in Uganda. Of which, $640,000 has come directly from Aspen employees in the UK and the United States.

“The Aspen-Adara Group partnership is unique in the financial services sector, both in its depth of engagement with local communities and in the degree to which it has become embedded in Aspen’s corporate culture,” said Anubha Rawat, communications and partnerships director for The Adara Group.

“It has shown us the exponential power of linking the business sector with those in need in the developing world,” he said.

It’s not easy for Westerners to visit Uganda and keep their emotions in check. Although discouraged, tears are commonplace as insurance sector employees used to living in relative comfort confront the harsh conditions Ugandans live in.

During his week-long September trip, Vitale visited the neonatal center and maternity ward that Aspen’s support has made possible. He played with the village children, participated in daily prayers and otherwise immersed himself in a culture that almost automatically becomes beloved to those Aspen staff members that visit there.

“Nothing prepared me for the fact that this was really Ground Zero for the worst and the best of everything.” — Mario Vitale, CEO, Aspen Insurance

All in all, he said, he came away a changed man.

“Nothing prepared me for the fact that this was really Ground Zero for the worst and the best of everything,” he said.

By the best of everything, Vitale meant the boundless hope that Ugandans bring to their daily lives.

“I’ve never seen so much hope. They call Uganda the Pearl of Africa, and I think some of it has to do with the spirit. The spirit of the people is one of hope,” he said.

By the worst of everything, he meant the poverty and health challenges Ugandans face.

Those include high infant mortality and the ravages of more than a million citizens infected with HIV.

Expanding Crucial Medical Services

The Kiwoko Hospital started as a clinic under a tree in 1986 by an Irish missionary, Ian Clark, in the aftermath of one of Uganda’s devastating civil wars, which killed and displaced hundreds of thousands of people.

The hospital is now a 25-acre compound employing more than 350 staff, with 270 patient beds and offering medical services to a region of 500,000 people.

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Funding from Aspen led to a three-fold increase in the size of the hospital’s maternity ward and its neonatal center.

When Aspen first started working with The Adara Group, fewer than one-third of the prematurely born babies in the Kiwoko Hospital survived. Now, the survival rate of premature babies is more than 80 percent.

“We saw the babies,” Vitale said. “We got a chance to hold them and interact with them. And we got to meet the doctors and the nurses and the skilled staff,” he said.

“I walked back a different person.”

Aspen Insurance CEO Mario Vitale with some friends in the  village of Kiwoko, in Central Uganda.

Aspen Insurance CEO Mario Vitale with some friends in the village of Kiwoko, in Central Uganda.

Vitale likes to go on safaris, and when he traveled to Uganda, he brought with him a new set of clothing, boots and equipment with the intent to use them recreationally.

Once there, though, he decided to give them all away to the Ugandans.

“I felt guilty to own it and so I left it there in a basket. Nobody wanted to accept them. They said, ‘You can’t do this.’ I said, ‘Yes I can,’ ” Vitale said.

“I know that somebody there needed it a lot more than I did and there was no possible way that I could keep that stuff and leave there with a good conscience,” he said.

Taking Further Action

When he returned from Uganda, the first thing Vitale did was take a long, hot shower.

But then he started thinking about how he could involve others in the insurance industry to become involved with The Adara Group and make a difference in East Africa.

Last October, Vitale and Aspen organized a black-tie gala fundraiser for The Adara Group at the St. Regis Hotel in New York.

“We invited my friends in the industry, the brokers, the reinsurers, even competitors, and asked them to give generously to the cause and it was overwhelmingly supportive,” Vitale said.

The event netted more than $163,000 for the foundation.

Consider that in poverty-stricken Uganda, $4 buys a food package so that a destitute mother can feed her children; $75 covers a child’s school fees for a year and $50 pays for caregiver assistance for a child orphaned by HIV.

Aspen Re employee Susan Cannarella, who took an initial trip to Uganda in 2008 as an Aspen Adara Group Ambassador, is now the largest individual contributor to The Adara Group’s work with the Kiwoko Hospital.

Inspired by the need and her drive to help, Cannarella founded Beads4Dreams. The nonprofit buys paper beads from the Women’s Craft Group at Kiwoko and turns them into necklaces, bracelets and other works of art, which are then sold at craft fairs, church bazaars and the like.

As of the end of 2013, Cannarella’s nonprofit returned 100 percent of those proceeds to the people of Uganda, more than $63,000.

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“As I sit here on the plane on my way home from Uganda, I am flooded with emotions ranging from great joy to deep sadness,” Cannarella wrote in a recent blog post on The Adara Group website about her most recent visit to Kiwoko.

“I am very happy to be heading home as I have missed my family and friends, but at the same time, I am also sad to leave my new friends and ‘family’ from Aspen and Kiwoko Hospital,” she wrote.

Making an Impact

From its founding in Bermuda 16 years ago by Audette Exel, Sharon Beesley and a small group of friends and supporters, The Adara Group has gone on to make an important impact in Uganda and Nepal.

It is a common practice in Nepal for child traffickers to trick parents in remote rural villages into sending their children away to what they believe will be boarding schools.

In 2006, The Adara Group located 136 children in a basement in Kathmandu who had been trafficked from their homes in the remote mountain district of Humla.

The foundation initially found safe housing and rehabilitation services for the traumatized children.

Through a painstaking process, the foundation treated the children and worked around political strife in Nepal to return the children to their families by 2009.

In addition to the contributions of Vitale and Aspen, The Adara Group connects to the insurance industry in another substantial way.

Audette Exel is vice chairman of the board of the Steamship Mutual Underwriting Association Trustee. Steamship Mutual is one of the world’s largest P & I (Protection and Indemnity) clubs for the shipping industry.

Video: Audette Excel talks about why she started The Adara Group.

Her history in financial services is illustrious. Before establishing The Adara Group, Exel was managing director of Bermuda Commercial Bank and one of the youngest women in the world to run a publicly traded bank.

During 1995 and 1996, Exel was chair of the Bermuda Stock Exchange and served a six-year stint — 1999 to 2005 — on the board of the Bermuda Monetary Authority.

In 1995, Audette Exel was elected a “Global Leader for Tomorrow” by the World Economic Forum. She has certainly lived up to that billing.

For more information on The Adara Group, including ways to contribute, click here.

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Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]

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.

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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.

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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?

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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.

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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 an 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.

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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]