News & Press

Economics and weather have been particularly hard on the residential property marketplace, resulting in unanticipated significant losses. These and other factors have forced markets to re-think and recalculate what they are willing to do to insure these exposures, in effect go back to the drawing board in terms of risk tolerance and underwriting guidelines.

Here is information we hope will be helpful to our retail brokers in understanding the dynamics of this challenging industry. Click here to read more!

Like all media channels, the social networks – Twitter, Facebook, LinkedIn – play an important role in how consumers get and receive news, make personal and business contacts and communicate with the world.

As the use and influence of these networks grows for business and personal use, the risks to their users increases significantly. In addition websites that incorporate chat rooms, blogs, and other interactive communication, along with open communication sites such as jezebel.com and the “comments” section of news sources including newspapers, radio and cable news outlets, expose users to risks that suggest a full range of opportunities for business interruption, disruption, claims and litigation.

Read the full article here.

Many organizations are beginning to appreciate the developing liabilities that can accompany a breach of customer data containing personal identifiable information. The insurance industry has been quick to respond to these issues by developing comprehensive policies as these liabilities evolve. The latest response addresses PCI (Payment Card Industry) fines or penalties.

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New York – New York – Swett & Crawford/Cooper Gay Re has announced that Joe has joined Cooper Gay Re as a specialist in Treaty reinsurance and will be responsible for developing new reinsurance treaty client programs. He joined Cooper Gay Re from Towers Watson (formerly Towers Perrin Reinsurance) where from 2008 to the present, he was responsible for managing and servicing both existing and new client programs in Marine, Energy and Aerospace reinsurance through Towers Watson’s Marine practice based in New York City, with offices in London. Joe also served as a reinsurance information technology advisor for Towers Watson.

Joe is a member of the Intermediaries and Reinsurance Underwriters Association (IRU, Inc.), and serves on its Board of Directors. He is also Chairman of the Journal of Reinsurance, the official publication of the IRU.

Joe holds a Bachelor of Science in Physics with a minor in Arabic from Georgetown University and has studied at the University of Damascus in the Syrian Arab Republic. He also attended the Lloyd’s of London Broker School. He is proficient in Arabic, Farsi and German.

New York, NY – Harold Field, Sales Leader of the New York & New Jersey offices of Swett & Crawford announced that Lou Stanzione has joined the Manhattan Casualty Practice Group as a broker. He comes to Swett & Crawford from a four-year stint at Demetriou General Agency where he was Director of Commercial Lines.

Stanzione began his 25 year career at Aetna Life & Casualty where he held various underwriting and marketing positions. In 1996, he moved from Aetna to New Hampshire Insurance Company where he served as Business Development Manager.

In 1998, he joined Zaloom Associates, Inc. in Lodi, New Jersey as Vice President of Marketing and in 2005 become the President of that firm, where in addition to being responsible for all management including production; he built and managed his own multi-million dollar book of business.

In commenting on the arrival of Stanzione to Swett & Crawford, Field said, “Lou is a seasoned casualty broker who understands the value of building strong and lasting relationships with retail brokers. His marketing and management skills will be a great addition to the Casualty Practice Group here in New York.”

Boston, MA - Swett & Crawford Boston Sales Leader Gary Joyal announced that Kieran N. Murray has joined Swett & Crawford as a Professional Liability broker serving clients nationwide.

Murray, an attorney, began his career with Lexington Insurance Company/AIG as a claims examiner in employment practices liability. After a brief stint as an Associate at a Boston area law firm, Cetrulo & Capone, LLP, he returned to Lexington where he spent the next nine years in positions of increasing authority, rising from a home office underwriter of EPLI/Workplace Violence coverage to become the Professional Lines Manager at the National Branch. He managed all aspects of a $90 million Professional Lines book of business which included E&O, EPLI, A&E and D&O coverages.

Murray comes to Swett & Crawford from Cover X Corporation/First Mercury Financial Corporation where he served as Vice President of Professional Liability. Under his leadership a Professional Lines Division was created which marketed and underwrote non-admitted surplus lines business exclusively through wholesale brokers.

Commenting on Murray’s arrival, Mr. Joyal said, “Kieran’s experience as an underwriter, attorney, marketing and sales leader exemplifies the acumen and skill of our nationwide network of Professional Liability specialists. We are pleased to have him on our team.”

As reported in a previous Swett Alert, we are experiencing in the United States an ever increasing amount of employment litigation, including class actions. Swett & Crawford has noticed that this increase does not stand in isolation, but is coupled with a significant hardening of the market for EPL and private company D&O products.

Wage & hour litigation continues to be the leader among employment litigation. A 2012 study of workplace litigation by Seyfarth Shaw reports that the number of court decisions on wage & hour issues in 2011 was more than triple that of employment discrimination and ERISA actions combined. This study also noted a meaningful uptick in wage & hour actions in state courts, particularly in California, Illinois, New Jersey, New York, Massachusetts, Minnesota, Pennsylvania, and Washington.

Government enforcement efforts are also at their peak. For example, the EEOC received 99,947 complaints of workplace discrimination in 2011, a slight increase over 2010 levels and the highest number of complaints ever reported. The EEOC expects the increases to continue due, in part, to a weak job market. Two categories of complaints on the rise are those involving religious and national-origin discrimination. Religious discrimination claims increased about 5% between 2010 and 2011 according to the EEOC, and national-origin discrimination claims increased about 10%. Slightly fewer claims of race and sex discrimination were made in 2011 as compared to 2010.

The EEOC resolved 112,499 complaints in 2010, of which eighteen percent received some sort of settlement at the EEOC level. This represents the largest number of complaints resolved by the EEOC in at least fourteen years. On the other hand, the EEOC has also brought more lawsuits than ever in its own name, particularly against employers accused of discrimination affecting large groups of alleged victims of discrimination.

Markets are responding quickly to this increased litigation activity, including one carrier that has increased premiums three times in less than a year’s period. Here are some of the marketplace trends we have noticed in the past year:

• California: EPL premium increases from 25% to 100%, depending on location and class of business. Some carriers are withdrawing from the EPL and private D&O marketplace entirely.
• Florida: EPL renewal rates up 5% to 10%, with FLSA nonrenewal for some insureds and difficulty in obtaining coverage for law firm and automobile dealer classes.
• Midwest: EPL, E&O and D&O renewal rates up 5% with no claims and 10% with claims.
• Mid-term additional premiums being charged for multi-location insureds who add locations during the policy year.
• Increased minimum premiums and required retentions in all professional lines.

Even in light of this news, wage & hour coverage remains available for most insureds. There remain markets willing to offer this coverage for California risks. With the hardening market, relying on the knowledge of your Swett & Crawford broker is more important than ever. Let us assist you in finding the right coverage for your client’s situation.

Brian Krause, who began his hands-on well control career as a 19-year-old apprentice to famed American oil well firefighter Red Adair, rose to Vice President in Adair’s company, and later led the firefighting team that controlled six sabotaged wells at the start of the Gulf War, has joined J.H. Blades & Co., Inc.. Most recently Krause spent six years as Vice President of Travelers Oil and Gas. J.H. Blades & Co., Inc. is a division of Swett & Crawford, part of the world’s largest global wholesale brokerage and reinsurance organization.

Krause spent nearly three decades on active assignment throughout the world controlling blowouts. Following Adair’s retirement in 1993, Krause and other former Adair colleagues went on to form their own company, IWC/Boots & Coots. Krause was President and Senior Well Control Specialist of IWC / Boots & Coots from its 1995 start until 2003.

In addition to the assignment in Iraq, other highlights of his well control career include:

• In Hungary, he served on the team that capped the world’s largest thermal blowout.
• In the North Sea, he assisted in controlling the multi-well Piper Alpha disaster in which 168 lives were lost, killing 36 wells, a third of which were burning.
• In Kuwait, he was Red Adair’s project manager for controlling 123 burning wells.
• He capped and controlled a major blowout in a single day at a location two miles from Midland International Airport.

His transition from fighting the fires to mitigating their impact from the insurance side was a natural one. “Seeing first-hand while battling blowouts in every corner of the world exactly what ‘a perfect storm’ of circumstances causes them,” Krause explains, “gave me valuable insight in how to prevent them.”

Richard Martin, who heads J.H. Blades and is the Practice Group Leader of Swett’s Energy Group, asserts that Krause brings an extraordinary skill set to the Blades well control broker team. “Brian’s front line experience and impeccable credentials deliver expertise to our clients that greatly enhances their ability minimize the risks that are inherent in their businesses. We are delighted to have Brian as a key member of the Blades/Swett & Crawford team.”

A January 3rd, 2012 decision by the National Labor Relations Board makes clear that employment class actions are not going away without a fight. This decision comes less than a year after the United States Supreme Court reaffirmed the vitality of arbitration agreements as a way to limit class action exposure. It appears there may be a showdown coming to reconcile the conflict that exists in the law at the federal level.

By way of background, the employment litigation in the U.S. is at an all-time high. In 2011 a record number of cases were filed in each of the following categories: employment discrimination, wage & hour and ERISA. The highest risk area in employment litigation is almost always class actions. To mitigate this risk, many companies require that their employees sign agreements waiving their right to a trial in court and waiving their right to bring a class or collective action, all in favor of individual binding arbitration.

In 2011, the U.S. Supreme Court issued an opinion strongly favoring arbitration in AT&T Mobility v. Concepcion, 131 S. Ct. 1740. That case held that the Federal Arbitration Act trumps a California state law that would have voided arbitration agreements like the ones described above. The AT&T case was not an employment case, however, unlike the recent government agency decision in D.R. Horton, Inc. and Michael Cuda, NLRB Case No. 12-CA-25764. That case affirmed employees’ right to bring class or collective actions and found it illegal to ask employees to sign arbitration agreements attempting to prevent that right. Even though this is a case under the National Labor Relations Act, it applies to all U.S. employees, whether their workplace is union or non-union.

As a result of the D.R. Horton decision, employment class actions are once again very much in vogue. Plaintiffs’ attorneys will continue to feel emboldened to bring such actions. You should make sure your clients have reviewed their EPL programs, which can offer protection against these risks. Your Swett & Crawford broker can assist you in finding the right coverage for your client’s situation.

© 2012 The Swett & Crawford Group, Inc. Prepared by Kevin Wolff, Swett & Crawford's Deputy General Counsel. Kevin assists Swett & Crawford's Professional Services Group brokers by preparing policy comparisons, advising on coverage issues and tracking legal developments that have coverage implications. This alert should not be considered legal advice.

Transportation Underwriter David A. Pohle has joined the Transportation Practice Group of Swett & Crawford, Pete Feeney, Sales Leader of the Scarborough and Media offices, announced today. He joins Swett & Crawford after eight years at Jimcor Agencies where he was the lead underwriter and director of the Transportation Department.

Prior to that affiliation David held a series of positions with increasing responsibility at Baldwin Sadler Corporation, beginning as an Underwriting Assistant in 1993 and ending his tenure there as Vice President of Transportation Underwriting.

“David brings over 17 years of Transportation underwriting experience along with a significant retail following to his assignment here at Swett. We are extremely pleased to have him on our team.” Feeney said.

Swett & Crawford, a leading wholesale insurance intermediary, announced today that it has acquired The ABC Program, an underwriting facility based in St. Louis, Missouri, from AHM Financial Group LLC.

The ABC (“Aviation Based Coverage”) Program delivers a comprehensive offering of property and casualty insurance including airport property, automobile, inland marine and other related coverages geared to retail brokers specializing in aviation.

The transaction was completed on January 4, 2012. The ABC Program will operate as The ABC Program, a division of Swett & Crawford.

“The ABC Program has both a long history of service to the aviation industry and an outstanding reputation in the insurance industry. We believe it will be an excellent fit with our existing products and capabilities,” said J. Neal Abernathy, President and Chief Executive Officer of Swett & Crawford. “Partnering with the program’s carrier, OneBeacon, we are confident we will help take the facility to the next level.”

Beckie Rodriguez, who will continue as Program Manager for The ABC Program, commented “Swett & Crawford will be an outstanding partner for The ABC Program. Swett’s national network of retail agents and high-quality employee base of brokers and underwriters will give us the distribution we need to expand. We are thrilled to join the Swett & Crawford team and are excited for the growth that the combination will bring to Swett and the program.”

Michael Bavely, Executive Vice President and Chief Financial Officer of Swett & Crawford said, “Our acquisition of The ABC Program is consistent with our strategy to expand our underwriting platform and bring more product offerings to our existing clients. As a company, we hope to continue to add high-quality program business to our platform via acquisition in the months that follow.”