The 2020 Insurance Executives to Watch: The Hanover’s Bryan Salvatore

The Hanover's Bryan Salvatore talks the importance of sustainable business models, customer relationships, and attracting young people to the industry.

By: Emily Spennato | January 24, 2020

Bryan Salvatore wants young people to hear a message that many others in the industry are championing: Insurance is an exciting business.

He has 25 years of fulfillment and experience in specialty lines to show for it.

Most recently, Salvatore joined The Hanover as executive vice president and president of domestic specialty after 20 years at Zurich North America. There, he served as president of their specialty products business.

Salvatore has garnered experience across many different lines of insurance. His diverse background, willingness to focus on experience instead of climbing the ladder, and emphasis on business sustainability are just some of the reasons he was designated a 2020 Executive to Watch.

Rolling With Changes

Salvatore entered his new role within The Hanover in stride and welcomed the change. Part of the reason for the smooth transition in 2017 was the clear vision he felt within the company.

“The distribution model is so important,” he explained of the business culture he immediately felt when he joined The Hanover.

“We are focused on the middle market, small commercial account segments, and really driving solutions. Those are very important issues in specialty… Instead of working on very large accounts, my focus is on ‘how do we best serve our relatively new businesses and get them more deeply engaged with our agents?’ That’s so important to our franchise.”

Most recently, Salvatore has been focusing on financial institutions in specialty with the November launch of Hanover Financial Institutions Advantage, which aims to better serve small to mid-sized asset managers and depository institutions with coordinated coverage.

Properly engaging agents and brokers to be aware of the unique risk exposure of niche markets is one of the biggest challenges in specialty.

“A lot of agents, frankly, aren’t very good at trying to create that account-centric solution for the customer and for the agent,” said Salvatore of the unique requirements of coverage.

To find solutions that work for clients, Salvatore is focused on sustainability and knowing how to identify weaknesses within a business model.

“We want to grow this business in the places that we think make the most sense right now. To be sustainable in specialty, sometimes you have to slow down and make sure you feel good about the book of business you have and then there are times you have the opportunity to grow,” Salvatore explained.

“It’s about continuing to move our specialty business up to that next level, continuing to drive growth, and doing it in a smart way.”

Knowledge Is Power

Being smart — or using knowledge to predict and or prevent future events — is precisely what the insurance industry derived from.

“Cyber is a great example of an emerging risk that has demonstrated it has real severity,” explained Salvatore as an example. “It has demonstrated that losses develop in a way that is different from other professional lines and coverages that we, as an industry, have been providing for a long time. We didn’t walk away from it though, did we?”

Knowledge is something Salvatore thinks the industry utilizes well, especially when it comes to finding solutions for unprecedented risks. Protection against these risks lies in the hands of insurers.

“Of course, it’s never perfect, but the industry evolves its products and evolves its thinking. Our ability to jump into emerging risks, provide a solution, learn and adjust has really helped businesses,” said Salvatore of effectiveness within the industry.

Leveraging Relationships to Build Experience

Looking back on the years behind him in the industry and the ones to come, Salvatore credits two major things to his successes: relationships and experience.

He is an insurance exec who builds partnerships to last and isn’t afraid of the leg work.

“In order to be effective and successful, you have to build trust and confidence with a customer so they feel they can rely on you in moments of need. You build relationships by delivering on your promises and working through challenges together. The relationships that you build can last years.”

In fact, some of the proudest moments in Salvatore’s career were the ones where he helped his colleagues advance in theirs.

“I moved someone I knew within the financial institutions space to the head of a property and casualty group, [which] included environmental, excess and rail business, among other businesses … in one of my other past roles, I appointed a woman who previously was lead pricing actuary to head of environmental and she excelled in that.

“When you see people demonstrate and communicate that they are looking for better challenges and then they earn it and you are successful in helping them achieve it, that to me is a real accomplishment.”

Climbing the Ladder… Sideways

Salvatore measures personal success by it’s positive impact on others. He often asks himself, “As a leader, am I able to have a positive, sustainable impact, whether it’s on a team that works with me or one of our businesses?”

He emulates the values of a true team player.

“I had many different roles in my last company and sometimes that meant a lot of movement. In these niches, if you want to move up, at some point you’re at the peak of a very narrow triangle,” he said.

“That’s the type of advice I offer young professionals. Take some risks. Don’t always focus on moving up, focus on moving laterally to learn; be patient, and that’s how you become proficient at it.”

And proficient Salvatore is. Now that he’s found his footing at The Hanover, Salvatore is focused on advancing existing products to become even more relevant to their agents. After almost three decades in the industry, he has climbed — and is still climbing — his fair distance on the horizontal ladder of success.

When asked what makes him most proud, Salvatore said it’s helping others accomplish that horizontal distance as well.

“I get more of a sense of accomplishment from working with people who have real potential, helping them understand and work through their career opportunities, and how to achieve that; that’s where I find the most pride.” &

For the full list of Insurance Executives to Watch in 2020, click here.

Emily Spennato is a former staff writer with Risk & Insurance.

How a Carrier Partner Can Help Navigate a Challenging Management and Professional Liability Market

A combination of a choppy economy with increased claims frequency and severity could lead to rate increases in the Management & Professional Liability market.

By: Risk & Insurance | April 3, 2024

Rates in the management & professional liability (M&PL) markets were on the rise from 2020 to early 2023 and are now falling rapidly.

M&PL divisions manage a number of different insurance products including management liability (D&O), professional liability (E&O), employment practices liability (EPL), fiduciary liability policies, cyber, etc. In 2023 and into 2024, a big influence on the marketplace has been the extremely aggressive and softening public company D&O market.

Though these rates have been softening for management liability, that may change over the next few years as companies continue to adjust their business models motivated by economic uncertainty. Layoffs were up nearly 200% last year, Forbes reported, even as other recession indicators, like the inflation rate, improved. A recession could lead to an increased claim activity and force carriers to raise rates.

“Whenever there is a meaningful downturn in the economy, we tend to see claim frequency pop up,” said George Schalick, Jr., senior vice president of the Management and Professional Liability Division at Philadelphia Insurance Companies (PHLY).

With continued fiscal uncertainty, businesses potentially already burdened with pandemic-related claims should seek a carrier with a long history in M&PL products. They will provide much-needed risk management guidance and be better positioned to support their insureds during market fluctuations.

Why Insureds Might See an Uptick in M&PL Claims

George Schalick, Jr., Senior Vice President of the Management and Professional Liability Division, Philadelphia Insurance Companies

The current soft market might come as a bit of a surprise as it does not track with previous underwriting cycles and economic conditions. Afterall, many privately held and non-profit organizations struggled during the early days of the pandemic with shutdowns and rapidly declining revenues. But the Government assistance programs, like the Paycheck Protection Program loans, helped keep many afloat during the tough times.

“During COVID many organizations stopped doing business until they were able to sort out all of the health and safety challenges,” Schalick said. “They were forced to lock down, but then all the government assistance programs allowed them to keep people employed. The increased volume of claims we anticipated we would see coming from the lockdowns and restrictions that were imposed upon businesses in the U.S. didn’t manifest at first.”

“Just because there wasn’t an onslaught of reported claims at the beginning of the pandemic, doesn’t mean the circumstances that would give rise to a claim being reported didn’t occur. Courts and the judicial system were closed or slowed and now that they are back open, we’re starting to see the circumstances that occurred during the COVID lockdowns becoming claims today,” Schalick said. “Litigation is progressing.”

Added to the delayed pandemic litigation is a concern over newer claims that might be filed as the country inches toward an economic downturn. Though a recession was avoided in 2023, experts think a soft dip could occur in 2024, with 76% of economists saying there’s a 50% or less chance of an economic downturn this year — that almost always results in more management liability claims.

“During the Great Recession in 2008, we saw an almost immediate spike in claims because of the economic conditions and the pressure it placed on organizations. They were making personnel changes with significant belt tightening almost immediately.” Schalick said.

What’s in Store for M&PL Policy Rates in 2024?

Despite an uptick in claims and increased economic uncertainty, management liability rates haven’t increased, resulting in market-wide pricing levels that may not meet the increased pressure of rising settlements and jury verdicts.

“Rates are going the other direction and settlement values are not falling,” Schalick said.

The mismatch between rates, claim frequency and severity is, in part, because carriers experiencing the dramatic soft market in the public D&O market are seeking premium gain in the private and non-profit market.

“In the public company market, the rates have been decreasing significantly. The rates were increasing in the private, not-for-profit market, and rightfully so, but there’s a desire to supplement overall mid-size D&O for carriers who also write private not-for-profit, and they see that as an opportunity to aggregate premium,” Schalick said. “So the always competitive landscape in the private, not-for-profit market has dramatically increased in the last 18 to 24 months.”

Still, companies of all sizes and types should be concerned about management liability rates in the future. Legal system abuse is resulting in increases in both the amount of litigation and the size of verdicts plaintiffs are receiving.

Certain areas of the country are particularly vulnerable to this type of legal system abuse. As a result, insureds in these localities are likely to be vulnerable to rate increases.

“The environment is so positive for the plaintiff that forces premium increases so carriers are able to stay in that market long term,” Schalick said.

Why a Tenured Carrier Partner Can Help Insureds Navigate An Uncertain Market

It’s clear that insureds are facing an uncertain M&PL market over the next few years. Fortunately, carriers with a long history in the M&PL space will be there to offer stability.

Philadelphia Insurance Companies has been supporting this market for 35 years. PHLY is committed to offering long-term rate stability, even as economic and claims trends start to push premiums upwards. They have an appetite for all sorts of companies, large and small, for-profit and nonprofit alike.

“We’ve been at this game for a long time and are one of the most tenured underwriters in this space,” Schalick said. “We like to stay very consistent.”

PHLY has worked with both for-profit and non-profit on management liability policies. With dedicated M&PL teams throughout the company’s 13 regions, PHLY provides the support agents and brokers are looking for on behalf of their clients. The teams know their regions well and can respond to local trends. They’re also dedicated to making the renewal process as easy as possible for their partners and policyholders.

“We have real confidence in our results, so we focus a lot on making the renewal experience as painless as possible for all agents and insureds,” Schalick said.

The company is also investing in tools to help insureds avoid losses. Earlier this year, they launched a new online risk management platform, PHLYGateway, which offers resources for insureds on how to create an employee handbook and trainings on issues such as recognizing workplace sexual harassment and discrimination.

If insureds have questions, they can consult a Best Practices Help Line, provided via the platform. That way, they can get on the spot risk management guidance to help them prevent claims.

To learn more, visit: https://www.phly.com/mplDivision/managementLiability/default.aspx.

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