SELLING RISKS TO UNDERWRITERS The 365 Day Renewal Process Brian Schofield Managing Director Willis Rose Keville Director Bureau of Risk and Insurance Management State of New York September 17, 2002

STRIMA Know Your Risk Become totally knowledgeable about your risks. Become knowledgeable about other public entity risks and your relationship to the overall public entity sector. Be seen as a “Driver”. Be comfortable about what you don’t know. Benchmark your exposures and loss experience against industry standards. Back yourself up with statistical evidence.

STRIMA Find Good Partners in Your Broker and Insurer Look for the same qualities in them that they look for in you. Commitment Knowledge of the risk Mitigation of loss/prevention of loss Claims Longevity Additional services unique to your entity and that enhance your job performance

STRIMA Think LONG TERM Should you change brokers and/or carriers for 10 – 20%? Try to lock in a multi-year broker service contract. Discuss multi year deals with your carriers.

STRIMA The Renewal Process Pick One broker – It is difficult to “partner” with 3 different brokers. Pick your broker at least 180 days prior to renewal. Constantly update your exposures. Do not “shotgun” the market – create a short list that you and your broker will personally visit. Spend as much time as possible answering all of your underwriters questions. Never be afraid to say “I don’t know, but I’ll find out”.

STRIMA The Renewal Process (Continued) Ask about LTA (Long Term Agreements) – Get the OK from your senior management to lock one in if it makes sense. Focus on terms, conditions and limits even more than premium dollars especially if you have a big loss. It may be worth the extra 10% to get broader coverage. Explore options to risk share with your insurers (if you have been guaranteed cost or have a very low deductible).

STRIMA The Renewal Process ( Continued) If you have loss runs, do a triangulation and loss pick as part of the submission – your broker can help you. Personally conduct tours of of any buildings or facilities the underwriters want to visit. Invite them to meet with your facilities and safety people.

STRIMA Create A Winning Partnership Although cost is important, it is more important to have the proper coverage in place when you need it.

STRIMA Know Your Losses Understand how losses affect your program. Read your loss runs before sending them on to your carriers. Dispute claims that should be taken down.

STRIMA Benchmark Your Risk Show the underwriters how you manage your risk better than other public entities. Address claims frequency and/or severity.

STRIMA Test Your Partners When choosing a broker or carrier, see how committed to the partnership they are… Employee Training Additional Staffing Perimeter Security Survey Property Preservation Program

STRIMA Know Your Brokers and Underwriters Know your team. Identify an account manager - the most crucial member of your “team”. Know the Marketplace. Meet the “specialists”. Meet the claims people before you have claims.

STRIMA Prepare Your Broker for What you Expect of Them Let them know that proposals should be concise and without boiler plate. Communication is key to a successful partnership (timeliness and a sense of urgency are imperative). Negotiations should also be done as a partnership. Let them know that you will be an integral part of the renewal negotiations. Make sure they keep you appraised of all claims.

STRIMA Nourish Your Partnership Arrange regular scheduled meetings with your brokers and carriers – at least quarterly. Communicate additional exposures throughout the year. The ideal interaction between you as risk managers and your brokers and underwriters should produce a product which is better than that which any of you would have produced alone.