2014 Executives to Watch
Whether it’s the demands made on U.S.-domiciled companies with foreign holdings due to complex claim developments, or marshalling risk management forces to address the fevered advance of cyber risk, the Executives to Watch for 2014 have a lot to think about.
Their dialogue with risk managers, particularly those with property exposures in the Northeast, has shifted due to the large losses that were incurred from Superstorm Sandy. Property rates in New Jersey, New York and other parts of the Northeast were jumping up by double digits by mid-2013.
Terms in property are also undergoing more scrutiny, particularly with regard to the words “flood,” “wind” and “surge.” As Sandy taught us, property owners who thought they might have been protected by their flood policies ended up not being covered. Those types of nasty surprises are something carrier executives and their risk manager counterparts are going to be working hard to avoid in 2014 and beyond.
Risk engineering is also becoming more and more important. Flood and wind events offer lessons, and engineering solutions are out there to mitigate those events.
Many of our Executives to Watch are stepping into leadership roles that are going to give them added responsibility. As we’ve mentioned elsewhere, it’s easy to have an opinion until you take the wheel. In addition, achieving excellence is never easy. It requires the tolerance to absorb the pain of transition.
Having said that, insurance carriers can still be counted on to move conservatively when it comes to putting someone in charge of a large book of business. Every one of the executives listed here has proven themselves on other stages.
Talent — who can attract it and retain it — may never have been as pointed a concern in the industry as it is right now. The well-publicized jump of Peter Eastwood and three other prominent executives from AIG to take on the opportunity that is Berkshire Hathaway Specialty Insurance is one example of the industry’s shifting sands in talent.
On the one hand, the industry is graying; on the other, the industry is doing a better job of showing younger talent why this is such a dynamic, creative way to make a living.
In the words of one executive we interviewed, some of this younger talent knows it is in the deep end of the pool and is swimming as hard as it can.
Here’s to buoyancy, in leadership and elsewhere throughout these organizations.
One Risk and One Conversation at a Time
Dave Brosnan is ready to take on the world.
No, scratch that. Brosnan has already been taking on the world for going on three decades, including time spent as division president and chief underwriting officer of ACE Canada, president of ACE Casualty Risk, and European Zone underwriting officer with Chubb.
In May, CNA Financial Corp. tapped Brosnan to lead the insurer’s international expansion as senior vice president of CNA International.
Expansion, however, isn’t just about writing new business, according to the SVP. “It is about focusing on where we want to grow as an enterprise, and placing more resources behind targeted industries like health care, technology and other specialty lines, no matter what geographic location.”
CNA has a strong brand, Brosnan said, and he’ll be placing significant emphasis on increasing visibility and building that brand internationally.
“We already have the ability to serve international insurance needs in more than 200 countries and territories. Now, we need to focus on making sure our agents and brokers understand our capabilities, and begin to think of us on a global perspective.”
Necessary to achieving that goal, he said, is leveraging CNA’s ability to build productive relationships. “The key to our business model is soliciting feedback to better understand what companies are looking for in a carrier,” he added.
A Shifting Paradigm
The cyber market is set to take off, and Mary Fisk-Bieker is positioned to see it close up as chief underwriting officer of a global specialty business focused on the technology industry.
Companies of all sizes and sectors increasingly recognize their growing cyber exposures, but that recognition is finally knocking loudly on the boardroom door now that the Securities and Exchange Commission is requiring public companies to disclose cyber events.
“There are leading indicators occurring in governance and regulatory compliance that make me hopeful that a huge turning point in the cyber marketplace will take place,” she said. “It will be a significant growth area.”
That’s just one of the regulatory changes affecting the technology sector, which also must be aware of ever-changing regulations affecting clients, such as in health care and finance. That also means keeping a wary eye on changes that will come when the White House issues new cyber security standards to protect critical infrastructure.
“It’s very easy for a technology company to make mistakes,” Fisk-Bieker said. “It happens, whether it’s human error or a technology error. … What they need to have is a solution that will fill the gap.”
Building a Global Profile
Raised in Europe, educated in the United States, and with 24 years of industry experience in both Europe and Latin America, David Frediani believes he is perfectly suited for the role of president of Ironshore International.
“I’m an internationalist in my blood and in my background,” he said.
Frediani was appointed to the role in September 2012, after 30 years of fulfilling largely international duties with Marsh & McLennan Cos. His primary responsibility with Ironshore will be “establishing a sustainable presence in Latin America,” an undertaking launched with the opening of a hub in Miami. He said that the underwriting expertise of his U.S. colleagues will help to back up products and build business across the globe.
Second, the executive will focus on increasing submissions from the company’s U.S. offices to its Pembroke Lloyd’s branch in London, strengthening that syndicate’s products. He also plans to expand the company’s global brand and visibility through international marketing and building broker relationships.
Frediani has also been instrumental in rolling out Ironshore’s worldwide terrorism and sabotage program, which has come at a good time considering the rising global concern over terrorism and the uncertain future of the Terrorism Risk Insurance Act.
A New Ballgame
Since 2000, Jeremy Johnson has transitioned through leadership roles of increasing responsibility at AIG, displaying his talent for the business with each new step. Johnson now takes on a new role as the president and CEO of Lexington Insurance Co., AIG’s excess and surplus division.
Johnson took on the position in April, after serving as specialty product line executive, U.S. & Canada, for AIG Property Casualty, overseeing business lines including aerospace, marine, environmental, SME, trade credit, political risk and surety.
The Oxford-educated executive has taken on the role formerly held by David Bresnahan, who along with former Lexington chief Peter Eastwood and some other AIG executives, left AIG in April to join Berkshire Hathaway Specialty Insurance.
This will, in effect, pit Johnson head-to-head against his predecessor.
Johnson said that Lexington will remain competitive by hiring, challenging and developing the best talent as well as by “emphasizing innovative responses to our client’s challenges, both for individual clients and for particular industries.”
In addition, Johnson said, Lexington will maintain its leadership role in the E&S market through continued specialization, both with respect to underwriting and claims, and by “leveraging and investing in the science, actuarial and analytical resources across AIG to differentiate risk and opportunity.”
Faith in the Team
Taking over the leadership of a company that has been as successful as the Philadelphia Insurance Cos. has been in recent years might intimidate some, but not Bob O’Leary.
“I have not found the position intimidating at all. It’s actually been a lot of fun,” said O’Leary, a 31-year veteran of the company who was named CEO in February 2013. Before that, he served as the company’s Boston-based chief marketing officer.
O’Leary and the company have been in leadership transition, as former CEO and current chairman Jamie Maguire stepped aside in November and his replacement, Sean Sweeney, resigned soon after for personal reasons.
“Our succession planning allowed for a seamless transition in leadership,” O’Leary said. “I’ve been with PHLY for 31 years and the average tenure of our regional vice presidents is 15 years with the company.”
PHLY, as the company likes to call itself, is on some kind of a roll. The carrier has averaged $234 million in net income over the last five years, including a tough 2011, and saw its gross written premiums jump from $2.17 billion in 2011, to $2.39 billion in 2012. Count on O’Leary to look for more growth in 2014.
Success in Primary Casualty
XL’s North America Primary Casualty business, headed by Ken Riegler, rang up some impressive growth in 2013, shooting up 68 percent.
The additional business included that of several Fortune 500 companies, running the gamut from retail to manufacturing.
Riegler pointed to three areas that he credits for XL’s primary casualty success. One is the ability to tailor an insured’s collateral needs to its overall financial strength. The second is by using a hands-on approach to claims oversight. That means, for example, providing audits for insureds on how well TPAs are performing.
“We don’t just let the insured wallow in a sea of TPAs,” Riegler said.
“We truly give them oversight so we give them our opinions, right, wrong or indifferent of what we see in the marketplace. Who is handling claims based on their geography and based on industry groups, who is doing it well and who is not,” he said.
The third area where Riegler sees XL making a difference is in international programs.
U.S.-based customers with global operations are concerned about the regulatory environment in foreign countries. They’re also looking to their carriers for help in navigating claims development.
“You are seeing multi-party tort actions in these particular countries,” Riegler said.
Experience in Property
Liberty Mutual Insurance’s Commercial Insurance strategic business unit appointed Mike Martin as executive vice president and general manager, National Insurance Property, in August 2013. He takes on the role after serving as chief property underwriter for the Americas at XL Insurance.
Martin has more than 25 years of commercial property insurance experience, beginning with a strong engineering and underwriting base built at Industrial Risk Insurance. He joined Liberty Mutual because of the company’s strong property operation, which includes in-house risk engineers, a dedicated claims organization, and jurisdictional inspection services. These tools will help Martin distinguish the property line in the market. Traditionally, Liberty Mutual has focused on the problematic workers’ compensation line.
The dynamics of a post-Superstorm Sandy property market make Martin’s task all the more challenging.
The tangible good news for the Boston-based mutual is that it is seeing solid revenue growth, an increase of 8.6 percent in the third quarter, year over year, from $23.77 billion in Q3 2012, to $25.83 billion in Q3 2013.
Martin will work with agents and brokers to provide a full range of property insurance, inland marine and equipment breakdown products and services to mid-sized and large companies.
A New Flood Conversation
Specialty insurer Aspen celebrated its 10th anniversary in 2012 by rocketing ahead in its gross written premiums, racking up a 32 percent increase over 2011, to $1.3 billion.
In November, Robert Rheel, executive vice president, Customer, Distribution and Marketing, picked up the additional responsibility of head of U.S. P&C and programs. Rheel will now turn his attention to the company’s specialty niches in the program business and to helping insureds in the Northeast understand the new property world they now dwell in post-Superstorm Sandy.
“Aspen utilizes a blended model to bring both our progam and specialty products expertise to the program administrator and customer,” Rheel said.
“We also partner with a limited number of program administrators with expertise in specialized niches to jointly deliver risk solutions. I think these are the things that differentiate us today,” he said.
Rheel said the conversation with customers around flood has changed.
“I believe that flood is an area where customers have under-purchased coverage,” Rheel said.
Into the Spotlight
Insurance executives step into new leadership roles every day. But it’s not every day that doing so means stepping straight into the spotlight, with all eyes tracking your every move. It’s a circumstance that could rattle even some seasoned executives.
But Robert Schimek seems to be taking it in stride. When Peter Eastwood left AIG to take on the lead role at rival Berkshire Hathaway Specialty Insurance, Schimek was tapped to take on the role of president and CEO of the Americas for AIG’s property casualty business. Schimek had been in London, serving as president and CEO of the Europe, Middle East and Africa (EMEA) region.
“More than 50 percent of AIG Property Casualty’s premiums come from the 18 countries in the Americas, which span from Canada to Argentina,” said Schimek. “The success of our region is critical to our business, and leveraging our expertise and scale is key.”
Schimek’s accomplishments internationally will no doubt color his focus in the Americas, with an eye toward broad-scale collaboration. The executive said he is drawing significantly from lessons during his tenure in the EMEA region.
“There, we unified 47 countries with very different market conditions to work as one region and one AIG, initiating sales challenges to increase profitability and implementing programs to leverage our scale and operate more efficiently.”