Construction & Real Estate Insurance Discussion The New Option. Visibly Different. Construction & Real Estate Insurance Discussion

AGENDA Types of Insurance Wrap-Ups Administration Builder’s Risk Professional Environmental Loss Control Claims About Alliant

Common Construction Insurance Lines General Liability Workers Compensation Excess Liability Builders Risk Contractors Equipment Covers third party, bodily injury & property damage arising out of premises, operations, products, and completed operations Provides wage replacement and medical benefits to employees injured in the course of employment Provides additional limits over the primary general liability policy with all of the coverage features of the underlying policies Property insurance which covers materials and equipment should they sustain a loss or damage from a covered cause during the course of construction Provides insurance for mobile machinery, equipment and tools. Covered equipment may be owned, rented, leased or borrowed

Common Construction Insurance Lines Riggers Liability Contractors Pollution Liability Pollution Legal Liability Project Professional Liability Owners Protective Professional Indemnity Insurance for a contractor's liability arising out of the moving of property of others, such as lifting air-conditioning units onto a roof with a crane. The CGL policy excludes "personal property of others in your care, custody or control." Covers third-party claims for bodily injury and property damage for remediation costs stemming from pollution incidents resulting from a contractor’s covered operations Covers property owners for third party bodily injury and property damage and clean-up costs for pollution conditions on owned and operated properties Covers property owners for bodily injury and property damage arising out of the work of design professionals providing services related to a project Excess coverage over designer professional policies for project owners for bodily injury and property damage arising out of the work of design professionals

Proprietary & Confidential What is a Wrap-Up? Wrap-Ups are widely used on public and private sector construction projects Can be sponsored by owner or general contractor Through a Wrap, the owner of a construction project provides general liability insurance and workers compensation for all eligible parties, including the general contractor and all sub-tier subcontractors Wrap-Ups can be utilized on a single project with a construction value of $5M+ or on multiple projects that are combined into a “Rolling” Program Proprietary & Confidential

Proprietary & Confidential What is a Wrap-up? Traditional Insurance Approach Multiple Insurers Inadequate Limits Potential Gaps in Coverage Potentially Uninsured Subcontractors Cross Litigation Between Contractors Indemnity Issues XS GL WC General Contractor Subcontractors Owner Owner Wrap-Up Program Control Cost Reduction Competitive Advantage Higher Coverage Limits Consistent Coverage Across Contractors Coordinated Claims Minimize Cross Litigation/Subrogation Allows for a Larger Qualified Contractor Pool WC GL XS General Contractor GL WC XS Subcontractors Proprietary & Confidential

Proprietary & Confidential Wrap-Ups vs Traditional Approach Wrap-Up TRADITIONAL APPROACH Cost Owner/Contractor receives maximum financial benefit Owner posts collateral and pays premiums Higher overall costs for Owner Coverage Same coverage terms for all parties Contractor policy coverage terms vary by individual contractor Limits Dedicated program limits Contractors have varying limits of insurance that may be eroded by multiple projects Claims Owner controls claims for completed operations period Broker provides claims advocacy Cross-litigation between contractors Individual contractors responsible for their own claims Potential bad publicity from unresolved claims Administration / Program Setup Owner sets contractor insurance requirements and assembles underwriting data Owner monitors program progress Broker administers program Owner sets contractor insurance requirements Other projects Owner can include multiple projects in its Wrap-Up program Other projects cannot be included in the same program unless the same GC is utilized Cost Avoidance Options 1) Net Bid - Subcontractor Bids Without Insurance Included (Bid Accepted) Bids Accepted Net of Insurance Competition Forces Removal of Costs Savings Estimated 2) Insurance Add Alternate - Insurance Cost Identified and Reviewed (Bid Adjusted) Insurance Costs Identified in Bid All Costs are Identified and Negotiated in Bidding Process Savings Identified Up-front (No Payroll Adjustment) 3) Bid Credit Tracking - Subcontractor Bids With Insurance Included (Bid Adjusted) Insurance Costs Identified and Tracked Over Project Term Remove All Costs Contractors Would Pay In Absence Of A Wrap-Up Program All Insurance Costs Identified and Removed 7 Proprietary & Confidential

Proprietary & Confidential OCIP vs CCIP OCIP CCIP Cost Owner receives maximum financial benefit Owner posts collateral and pays premiums GC receives maximum financial benefit Contractor posts collateral and pays premiums Coverage Same coverage terms Limits Dedicated program limits Limits can be dedicated or shared depending on program structure Claims Owner controls claims for completed operations period Broker provides claims advocacy General contractor controls claims for completed operations period Administration / Program Setup Owner sets contractor insurance requirements and assembles underwriting data Owner monitors program progress Broker administers program GC manages contractor insurance requirements and program administration Broker administers the program Other projects Owner can include multiple projects in its OCIP program through a “rolling” OCIP Other projects cannot be included in the same program unless the same GC is utilized Cost Avoidance Options 1) Net Bid - Subcontractor Bids Without Insurance Included (Bid Accepted) Bids Accepted Net of Insurance Competition Forces Removal of Costs Savings Estimated 2) Insurance Add Alternate - Insurance Cost Identified and Reviewed (Bid Adjusted) Insurance Costs Identified in Bid All Costs are Identified and Negotiated in Bidding Process Savings Identified Up-front (No Payroll Adjustment) 3) Bid Credit Tracking - Subcontractor Bids With Insurance Included (Bid Adjusted) Insurance Costs Identified and Tracked Over Project Term Remove All Costs Contractors Would Pay In Absence Of A Wrap-Up Program All Insurance Costs Identified and Removed Proprietary & Confidential

WRAP-UP Coverages CPL PLL OPPI Excess Liability Compensation Workers’ Additional Coverages Excess Liability $50 - $200 Million+ Follow Form Excess Liability Builder’s Risk Contractors Pollution Liability Pollution Legal Liability $25 Million CPL PLL Professional Indemnity Owners Protective OPPI General Liability $2 M Combined Single Limit $4 M General Aggregate $4 M Products/Completed Ops Aggregate $2 M Personal/ Advertising Injury Employer’s Liability Proprietary & Confidential

Loss Sensitive Program WRAP-UP Financial Model Loss Sensitive Program Owner Cost without OCIP Minimum Savings Typical Savings (0.5% - 1.2%) of Construction Cost Cost Avoidance Owner Max. Cost with OCIP Maximum Savings Claims Minimum Cost Cost Avoidance Options 1) Net Bid - Subcontractor Bids Without Insurance Included (Bid Accepted) Bids Accepted Net of Insurance Competition Forces Removal of Costs Savings Estimated 2) Insurance Add Alternate - Insurance Cost Identified and Reviewed (Bid Adjusted) Insurance Costs Identified in Bid All Costs are Identified and Negotiated in Bidding Process Savings Identified Up-front (No Payroll Adjustment) 3) Bid Credit Tracking - Subcontractor Bids With Insurance Included (Bid Adjusted) Insurance Costs Identified and Tracked Over Project Term Remove All Costs Contractors Would Pay In Absence Of A Wrap-Up Program All Insurance Costs Identified and Removed Fixed Expenses (Insurance, Excess, Administration) 10% 20% 30% 40% 50% 60% 70% 80% 100% 90% 0% Loss Ratio Contractor Insurance Costs Wrap-Up Costs Savings = - - Losses Proprietary & Confidential

Pro Forma $200M Wrap-Up Example PROJECTS Construction Value $   Construction Value $ 200,000,000 Payroll (20%) 40,000,000 CONTRACTOR INSURANCE COSTS PREMIUM % OF CV Total 5,500,000 2. 75% CIP PROGRAM COSTS MINIMUM LOSS AGG+CLAIMS EXP MAXIMUM % of CV Total OCIP Program Costs 2,400,000 3,100,000 2.75% (@max) 1.20% 1.55% 2.75% LOSSES PROGRAM COSTS PLUS LOSSES INSURANCE CREDITS PROGRAM SAVINGS % OF CV REDUCTION IN INSURANCE COST 0% $ - 2,400,000 5,500,000 3,100,000 1.55% 56% 10% 310,000 2,710,000 2,790,000 1.40% 51% 20% 620,000 3,020,000 2,480,000 1.24% 45% 30% 930,000 3,330,000 2,170,000 1.09% 39% 40% 1,240,000 3,640,000 1,860,000 0.93% 34% 50% 1,550,000 3,950,000 0.78% 28% 60% 4,260,000 0.62% 23% 70% 4,570,000 0.47% 17% 80% 4,880,000 0.31% 11% 90% 5,190,000 0.16% 6% 100% 0.00%

WRAP-UPS Net Bid Insurance Add Alternate Bid Credit Tracking Cost Savings Options Net Bid Insurance Add Alternate Bid Credit Tracking Subcontractor Bids Without Insurance (Bid Accepted) Insurance Cost Identified & Reviewed (Bid Adjusted) Subcontractor Bids With Insurance Included (Bid Adjusted) Cost Avoidance Options 1) Net Bid - Subcontractor Bids Without Insurance Included (Bid Accepted) Bids Accepted Net of Insurance Competition Forces Removal of Costs Savings Estimated 2) Insurance Add Alternate - Insurance Cost Identified and Reviewed (Bid Adjusted) Insurance Costs Identified in Bid All Costs are Identified and Negotiated in Bidding Process Savings Identified Up-front (No Payroll Adjustment) 3) Bid Credit Tracking - Subcontractor Bids With Insurance Included (Bid Adjusted) Insurance Costs Identified and Tracked Over Project Term Remove All Costs Contractors Would Pay In Absence Of A Wrap-Up Program All Insurance Costs Identified and Removed Savings Estimated Savings Identified Up-Front (Not adjusted by project end) All Insurance Costs Identified and Removed Proprietary & Confidential

Proprietary & Confidential WRAP-UPS Realizing Financial Benefits Ensure proper bidding Contract language Education Large Deductibles Closeout Proprietary & Confidential

Proprietary & Confidential WRAP-UPS Administration Establishing Program Upfront is Key to Success Education Use WrapX to Manage the Program Ensure Adherence to National Standards/ Quality Control Online Portal to Receive & Deliver Information Allows Alliant to Focus on Customer Service Alliant WrapX: Administration Web-based system Highly Flexible Powerful search features Online Contractor Portal for all data entry Online Owner Portal with full access to program Automated Delinquencies and Reports Abilities: Distribution of all wrap documentation from system Generate reports View all subcontractors and track their enrollments Administration: Highly Automated, Allowing our Team to Focus on Customer Service and Value-added Activities Capable of Efficiently Handling Thousands of Contractors Built-in Controls National Service Standards Dedicated Service Phone Line for Continuous Team Demonstration of Savings Client Meetings 14 Proprietary & Confidential

BUILDER’S RISK First party coverage for owner and contractors during the course of construction Provides all risk coverage, including the perils of flood, earthquake and coastal windstorm. Includes fixed and mobile equipment Delay in start-up Limits up to $500+ million 15

PROFESSIONAL LIABILITY Owners Protective Professional Liability Alternative to costly project professional liability coverage Excess coverage sits above designers’ policies Coverage is triggered when designers’ policies are exhausted $25,000,000+ in limits Three years of coverage plus extended reporting period Professional Liability. Specialized Expertise. Complete understanding of large project complexities Policy language with optimal protection Tailored solutions and sound advice

ENVIRONMENTAL COVERAGE Contractors Pollution Liability Provides coverage for pollution conditions caused by covered construction operations, including subcontractors Applies to sudden and gradual pollution conditions Covers third party claims for bodily injury / property damage and clean up from on-site or off-site pollution conditions Limits available up to $200 Million 17

LOSS CONTROL Development of safety standards and training programs OSHA 10 and 30 monthly training seminars Active return to work programs Development of safety standards and training programs OSHA 10 and 30 monthly training seminars Active return to work programs

Proprietary & Confidential CLAIMS Establishment of Claims Procedures and Special Handling Guidelines Claim Reviews Coverage Questions Reviewed and Resolved Coordination in Production of Claims Kits and Insurance Manuals Facilitate Claims Process with Third Party Administration Litigation Management Definitive Close out Execution Plan for Open Claims and Reserves Claims These are just a few of the services that we provide when we take on a claim for you. We establish a benchmark through a thorough review of loss runs to establish the proper reserves and to determine if the current action plan is appropriate to bring about a resolution of the claim. From there we answer your and the adjustor’s questions and help facilitate the claims process. The rest is fairly standard and should be understood as necessary parts of any claim process. The right claims team working on your behalf will positively impact a client’s bottom line. Proprietary & Confidential

THE SPECIALTY BROKER Agri-Business Construction Employee Benefits Providing Service, Expertise and Risk Solutions to our Clients Agri-Business Construction Employee Benefits Energy and Marine Environmental Healthcare Public Entity Real Estate Tribal Nations THE Specialty Broker Alliant is the premier specialty broker and provides unparalleled service, expertise, and risk solutions to our clients. Construction Employee Benefits Energy and Marine Environmental Healthcare Program Management Public Entity Real Estate Tribal Nations Public EntityTribal Nations

SPECIALTY INSURANCE LEADER. Alliant. The Premier Specialty Broker 2,100+ Employees 2014 Premium $7.8 billion Revenue $621 million 3rd Largest Privately Held Broker Financial Partner Stone Point Capital Alliant Construction Services Group 380 Construction Specialists Over 2,000+ Clients 2014 Premium Volume $850M Specialty Insurance Leader 2012 Premium $6.8 billion Revenue $506 million Financial Partner KKR (Kohlberg Kravis Roberts & Co. L.P.) KKR currently manages private equity assets of more than $66.3 billion Alliant Company Statistics Founded in 1925 Headquartered in Newport Beach, California Largest Organic Growth in the Industry Recruitment of Top Senior Level Production Talent via Selective Acquisition Strategy National footprint Premier Specialty Broker Public Entity Construction and Homebuilding Hospitality Energy Healthcare Tribal Nations Manufacturing

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$850M+ 2,000+ Clients 380+ GROUP METRICS Premium Volume Construction Colleagues National Platform 2,000+ Clients Contractors, Developers, Engineers & Homebuilders $850M+ Premium Volume

Alliant Exclusive Solutions and Programs Technical Services: Claims Management Summary 1) Column 1 (L-R) Claim Kits Timely Reporting & Investigation Crisis Management Analyze expense reserves Ensure carrier compliance with best practices 2) Column 2 Vocational Rehab Mitigation of Losses at Every Level Return to Work Issues Explanation of current case laws and rules Medical Case Management 3) Column 3 Eliminating Fraud Customized Reporting Diligent Claims Monitoring Assistance at Mediation & Arbitration Establish Claims Procedures

THE ALLIANT APIP SOLUTION Alliant’s Public Entity Exclusive Property Program (APIP) Largest single property placement in the world with over $350 billion in Total Insurable Values (TIV) Over 9,300 public entity members across 44 states Enhanced coverages Terrorism Boiler & machinery Inland marine 1st and 3rd party cyber liability 1st and 3rd party pollution liability Appraisals every five years on buildings valued greater than $5 million at no cost PML Studies THE Specialty Broker Alliant is the premier specialty broker and provides unparalleled service, expertise, and risk solutions to our clients. Construction Employee Benefits Energy and Marine Environmental Healthcare Program Management Public Entity Real Estate Tribal Nations Public EntityTribal Nations

THE ALLIANT MROCIP SOLUTION Alliant’s Public Entity Exclusive Group Wrap-up Program OCIPs traditionally available only for projects exceeding $100M The Answer: MROCIP Innovative “pooled” approach extends the benefits of OCIPs to Public Entity’s with: THE Specialty Broker Alliant is the premier specialty broker and provides unparalleled service, expertise, and risk solutions to our clients. Construction Employee Benefits Energy and Marine Environmental Healthcare Program Management Public Entity Real Estate Tribal Nations Public EntityTribal Nations Single projects as low as $10M Individual or aggregated projects totaling $100M+ $10M $100M

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Additional Questions & Next Steps Technical Services: Claims Management Summary 1) Column 1 (L-R) Claim Kits Timely Reporting & Investigation Crisis Management Analyze expense reserves Ensure carrier compliance with best practices 2) Column 2 Vocational Rehab Mitigation of Losses at Every Level Return to Work Issues Explanation of current case laws and rules Medical Case Management 3) Column 3 Eliminating Fraud Customized Reporting Diligent Claims Monitoring Assistance at Mediation & Arbitration Establish Claims Procedures