2014 nrmc renewal webinar march 3, 2014€¦ · 2014 nrmc renewal webinar – march 3, 2014 march...

2014 NRMC RENEWAL

Webinar – March 3, 2014 March 18, 2012 Webinar

The materials contained in this presentation are confidential in nature and should not be distributed to third parties without the expressed consent of NRMC.

1

Introduction and Overview of Renewal 2014 – Patrick Madden

Renewal terms and Changes over PY2013 – Ken Schreiber & James Hutchinson

Renewal Procedures – Renee Guthart

Closing Remarks – Patrick Madden

Questions & Answers

THE MATERIALS IN THIS PRESENTATION ARE CONFIDENTIAL and

Exclusively for the use of NRMC Members.

Agenda

2

INTRODUCTION AND

OVERVIEW OF THE NRMC

2014 -2015 RENEWAL

3

Introduction and Overview

The Renewal is about Achievement and Acknowledgement

HUB’s goal: to present NRMC as “best in class” to the insurance markets and achieve the best possible renewal.

NRMC’s goal: to offer our members the best possible renewal in terms of coverage + cost.

Members’ goal: to demonstrate their commitment to our Program by renewing with NRMC.

3

4

Introduction and Overview

NRMC Program Achievements with Renewal 2014

Successful transition from Willis to HUB: Seamless and smooth

Completed in time for Renewal 2014 to be on schedule with our

members

Total Insured Values (TIVs): $3,454,322,071

Renewal demonstrates the value that HUB brings

to our Program Property = Reduced Program Retention + per occurrence limit on

the retention + lower premium rates

GL = Lower Retention, formation of NRMC RPG (Risk Purchasing

Group)

No compromise in coverage and no policy aggregate

4

5

RENEWAL 2014

What does the NRMC Renewal

look like?

6 6

Goal

HUB’s Mission: Position NRMC

as “BEST IN CLASS”

7

1. Review of Exposure Data

a) Number of Units

b) Total Insurable Value (TIV)

c) Types of Construction

2. Modeled Exposures to Identify Probable Maximum Losses (PMLs)

a) Named Wind Storm

b) Flood

c) Earthquake

3. Review of Loss Data

a) Property losses within and excess of the 2013 Retention

b) Liability losses within and excess of the 2013 Retention

NRMC RENEWAL PROCESS

8

Marketing Process

Based on the information we reviewed, numerous program

options were explored, including…

I) Expiring Program Structure at various

retention levels

II) Splitting out specific locations that incurred

large losses, thereby removing these losses

from the program experience

III) Seek first dollar programs (no retention) for

both Property and Liability


9

Marketing Process

Submissions:

2014 Property: Submission to 50 carriers, and all Lloyd’s syndicates

2014 Casualty: Submission to 30 General Liability & 25 Excess/Umbrella

carriers


10


Marketing Process

Marketing Process

Marketing Process

Results

Property

Incumbent lead carrier, Lexington, would not reduce rates or

retention level, nor would they agree to take a smaller

percentage of the program. Therefore Lexington will not be

part of the program as of 4/1/14.

Great interest was expressed by many Lloyd’s of London

Syndicates, as well as some domestic carriers. Big selling

point was NRMC’s commitment to STFS’s.

As a result, the renewal program will be significantly improved,

with better coverage at a significantly lower cost.

11


Marketing Process

Marketing Process

Marketing Process

Results

Property

Coverage Improvements:

1) Retention lowered from $3.5 Million to $2.5 Million.

2) Introduction of Per Occurrence retention of $250,000. This will

limit impact of any one claim on the aggregate retention.

3) Per occurrence deductible of $5,000 (member portion of property

loss) remains as expiring; however, if the $2.5 MM Retention is

exhausted during the policy year, the per occurrence deductible

will increase to $10,000.

12


Marketing Process

Marketing Process

Marketing Process

Results

Property

Coverage Improvements (Continued):

4) Flood limit will increase from $5.0 MM in high hazard areas, and

$50 MM everywhere else, to $100 MM for all locations. (NFIP

will still be required in High Hazard Flood Zones). This limit

applies per occurrence and is also the annual aggregate for the

policy term.

5) Named Storm limit will now include storm surge, so no

aggregate will apply to losses arising from this peril.

6) Vacant Buildings now included within the master policy.

13


Marketing Process

7) Policy form will remain the same, with all other terms and

conditions as expiring.

8) Program will be underwritten by numerous carriers, with

Travelers providing the lead. A significant amount of

the limits will be provided by Lloyd’s of London.

9) Overall Cost of Insurance, including retention funding,

reduced by 22% - Total Property Cost is $7,714,534

including taxes, fees, and TPA charges.

Property, cont’d.

14

Results

Marketing Process


Casualty

CHALLENGES:

Incumbent Carrier was acquired by Crum & Forster; more

conservative underwriting philosophy;

Construction exposures – carriers don’t generally look to

assume coverage for work in progress;

Historical loss experience was not favorable – has

improved over the past three years, but these are

considered “green” years (not fully developed);

15


Marketing Process

Casualty, cont’d.

Results:

Incumbent, now called Cover X, quoted 41% increase

in combined premium/retention, with a higher per

occurrence retention.

Most carriers would not offer a quote with an aggregate

on the retention.

However, the following program was quoted with very

favorable terms…

16


Marketing Process

Casualty, cont’d.

General Liability Carrier – NRMC RPG (QBE is the insurer)

Retention - $100,000

Aggregate Retention - $750,000

Premium - $1,200,000

(policy excludes ground up construction, gut rehabs, or

structural work – more detail will follow on this change)

Construction Liability Carrier – Crum & Forster (‘A’ Rated,

A.M. Best)

Retention - $15,000 per occurrence, no aggregate

Premium - $130,000

17


Marketing Process

Casualty, cont’d.

Other Casualty Lines…

Umbrella –

Limits increased to $100,000,000

Carriers – Various, lead carrier is Colony, same as expiring

Premium - 429,393 (same as expiring)

Non-Owned/Hired Auto Exposure -

$1,000,000 Limit

Premium - $629 per member (individual members may also have

autos covered under this policy and will be allocated their actual

cost for this exposure.)

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P r

o p

e r

t y

2014 Program Structure

NRMC 2014 PROPERTY PROGRAM STRUCTURE

Includes AOP perils, $500,000,000

All Flood for $25,000,000, xs $75,000,000

Full limits for Named Storm Wind

and Flood

$425,000,000 xs $75,000,000

$100,000,000 Terrorism Limit

RSUI/Landmark

Includes AOP perils including Flood, $75,000,000

Named Storm Wind and Flood

$50,000,000 xs $25,000,000

Scottsdale & Lloyds of London


Named Storm Wind and Flood

$15,000,000 xs $10,000,000

Liberty Mutual & Lloyds of London


Named Storm Wind and Flood Primary Layer

Liberty Mutual & Lloyds of London CA EQ

Program Retention $2,500,000 $5,000,000 Limit

limited to $250,000 per occ

19

C a

s u

a l t y


NRMC 2014 CASUALTY PROGRAM STRUCTURE

$100,000,000

Chubb

$50,000,000 excess $50,000,000

$50,000,000

Great American

$25,000,000 excess $25,000,000

$25,000,000

Navigators

$20,000,000 excess $5,000,000

Colony $5,000,000

$5,000,000 excess of underlying

QBE $1,000,000

$1,000,000 Per Occurrence Non- Construction Liability

$2,000,000 Aggregate Owned/ Policy

Hired

$100,000 Self-Insured Retention Per Occurrence Auto

$750,000 Aggregate Retention Liab.

20

Landm ar k 100%

Landmar k 30%

( $15M )

Axis 40%

( $20M)

I L Union 30%

( $15M)

Lexin

gton

60

%($

15M

)

Hiscox Ter r or ism $75M XS of $25M

Pr im ar y Pr oper t y

$500M

$75M

$25M

$5M

CA EQ & SFHA Flood Zones

$10M

HI & AK EQ

$50M

Flood & EQ

$100M

Deduct ible

Land

mark

–20

%($

5M)

Lloyd

s –

10% (

$2.5M

)

Swiss

Re

10%

($2.

5M)


21

NRMC RENEWAL QUOTES

NRMC 2014 Renewal Quote Comparison

Coverage 2013 Premium 2014 Premium % Difference Property $ 6,438,613 $ 5,214,534

Including premium,

taxes,fees, and TPA charges

Retention Aggregate $ 3,500,000 $ 2,500,000

Total Cost of Insurance $ 9,938,613 $ 7,714,534 -22.4%

General Liability $ 832,650 $ 1,266,300

Construction Liability Included $ 134,940

Above policies include Taxes,

Fees, and TPA Fees

Retention Aggregate $ 1,000,000 $ 750,000

Total Cost of Insurance $ 1,832,650 $ 2,151,240 17.4%

Umbrella Liability $ 429,393 $ 429,393 0%

Business Auto

Including Non-Owned/ $ 46,561 $ 85,204 83%

Hired Auto Liability for

all members

($629 per member)

Totals: $ 12,247,217 $ 10,380,371 17.5%

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NRMC RENEWAL QUOTES

Premium and Retention Allocation

Property premium will be allocated based on numerous factors,

including construction type, exposure to windstorm, flood, and

earthquake

Liability premium will be allocated based on tiered

rates as provided by the carrier.

Retentions will be allocated based on premium

allocations. However, for the first time, members with

favorable loss ratios and those who have reached

100% installation of STFS’s will receive “experience

credits” towards their retention allocation.

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RENEWAL PROCEDURES

24

MEMBERS WILL BE RECEIVING AN EMAIL BY MARCH

14th WITH THE FOLLOWING ITEMS:

•RENEWAL PROPOSAL OUTLINING:

• COVERAGE CHANGES AND HIGHLIGHTS

• UNDERWRITING CRITERIA

•MEMBER PERFORMANCE REPORT (AND SCORECARD) TO DEC. 31, 2013

•MEMBER PREMIUM COMPARISON LETTER

•MEMBER SOV 14-15 – SHOWING PREMIUM ALLOCATION BY LOCATION

•RENEWAL LETTER FROM DEB ASCHHEIM WHICH WILL REQUIRE YOUR

ACKNOWLEDGEMENT OF THE TERMS PRESENTED AND YOUR

INSTRUCTIONS TO BIND.

2014 Renewal Procedures

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MEMBER:

•WILL REVIEW THEIR SOV 14-15 TO MAKE SURE ALL LOCATIONS AND

LIMITS ARE ACCURATE

•SIGN AND RETURN THE PREMIUM COMPARISON LETTER WHERE

INDICATED TO AUTHORIZE BINDING

•SIGN AND RETURN THE RENEWAL LETTER

•ADVISE IF PREMIUM FINANCING IS NEEDED

HUB:

•WILL CONFIRM THAT REQUEST TO BIND HAS BEEN RECEIVED

•PREMIUM INVOICES BY MEMBER WILL BE GENERATED. [TIMING]

•PREMIUM FINANCING PAPERWORK WILL BE PROCESSED AND EMAILED

•CERTIFICATES WILL BE ISSUED

•MEMBERSHIP FEES BY MEMBER WILL BE GENERATED

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MEMBER CONTACT INFORMATION

IN ORDER TO MAKE SURE THAT THIS RENEWAL PACKET GETS TO THE CORRECT

PERSON AT YOUR ORGANIZATION AND ALSO IN AN EFFORT TO HAVE CURRENT

CONTACT INFORMATION PLEASE FORWARD AN EMAIL TO DESIGNATE UP TO 3

PEOPLE THAT ARE TO RECEIVE YOUR COMPANIES NRMC CORRESPONDENCE.

PLEASE EMAIL THE CONTACTS TO MY ATTENTION - ENTER IN THE SUBJECT LINE

OF THE EMAIL: KEY CONTACT INFORMATION FOR NRMC

INCLUDE THE CONTACTS NAME, PHONE NUMBER , EMAIL ADDRESS.

ALSO ADVISE THE CURRENT OFFICE/MAILING LOCATION.

THIS IS FOR MASS EMAILS, MAILINGS, FLYERS ETC. WE WILL STILL HAVE ON

RECORD ALL EMPLOYEES THAT SPEAK TO US REGULARLY. WE WILL BE SENDING

YOU A COMPLETE LIST OF CONTACTS THAT WE HAVE FOR YOUR ORGANIZATION

IN ORDER TO HAVE IT UPDATED WITH CURRENT INFORMATION. THAT MAILING

WILL BE GOING OUT SHORTLY AFER THE RENEWAL PROCESS IS COMPLETE.

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FOLLOW UP MEMBER CALL

In order to review the renewal proposal in greater detail and to address other items, we will conduct another webinar to answer your questions. Date and time will be provided with your renewal package.

TOPICS OF DISCUSSION: RENEWAL PROPOSAL

FINANCING

INVOICES

CERTIFICATES

POLICY ENDORSEMENTS – NEW FORM NOTIFICATION PROCEDURES FOR ADDING NEW LOCATIONS AND PROJECTS

PAPERWORK NEEDED FOR NEW CONSTRUCTION PROJECTS

NEW NON-OWNED AND HIRED AUTO PROCEDURES: OBTAINING MVR’S

BASED ON DRIVING RECORD – WHO IS AN ACCEPTABLE DRIVER

HAVING ON FILE THE EMPLOYEE’S PERSONAL AUTO POLICY INFORMATION

NRMC – HUB WEB-PORTAL

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QUESTIONS?

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CONTACT INFORMATION:

Deborah Aschheim

NRMC Executive Director

212.509.6762

917.882.9949

[email protected]

Patrick Madden

NRMC Board President

518.272.8289 Ext. 206

[email protected]

Renee Guthart, CPCU

Vice President,

HUB International Northeast

516.677.4947

[email protected]

mailto:[email protected]

mailto:[email protected]

2014 nrmc renewal webinar march 3, 2014€¦ · 2014 nrmc renewal webinar – march 3, 2014 march...

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