All Hat… No Cattle

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I always loved this Texan saying, and it is so appropriate as I am heading off to San Antonio to the humongous RIMS conference there next week and I have neither hat nor cattle.

A small, but intrepid, Vermont contingent heads to the RIMS conference every year where we proselytize on the magnificence of captives to the passing hoard (usually about 10,000 or so folks). Ian Davis will be our valiant captain as a bunch of us hang out at the cool Vermont booth for the conference. And Dave Provost and a number of the DFR champions will join us as well. So if you are going to be down there, please swing by the booth and grab a bowl of Ben & Jerry’s or pure Vermont maple syrup!

Speaking about the opposite of All Hat, No Cattle, Business Insurance handed out a couple of their 2018 US insurance awards to risk management programs recently, and one of our outstanding members picked up a trophy.  The honor for 2018 Risk Management Team of the Year went to global electrical power company AES Corp., American International Group Inc. and Marsh L.L.C. for their innovative approach of embedding terrorism and resultant damage cyber coverage within AES’ existing global captive property program, eliminating potential gaps between policies, providing additional limits and expanding cover to all AES insured assets. Andrew Baillie, program director of global insurance for AES, is the facilitator at our session of captive owners looking at international issues at VCIA’s annual conference this August.

Registration for the VCIA Annual Conference opens May 1st. We look forward to seeing many of you there for another excellent program!   Thank you and I look forward to hearing from you.

Rich Smith
VCIA President

Corporate Responsibility…. And a Good Wage

career-goalsOne of the biggest issues facing the captive insurance industry, indeed the entire insurance industry, is filling in our next generation of workers and leaders. I was listening to Bob Hartwig of the Darla Moore School of Business, University of South Carolina, talking on A.M. BestTV on recommendations on how the insurance world can and should attract the next generation workforce to our broader industry.

His number one piece of advice was to articulate a clear path for candidates looking far down the road on what is expected and what opportunities lay out there – even ten years out. Students are really looking for what opportunities lay open to them, including wages and benefits. That isn’t to discount corporate responsibility: young people today are looking to work for an organization with a positive mission and workspace, and take into consideration corporate responsibility, whether locally or globally.  Just understand good wages, benefits and opportunities for advancement are as important to newer entrants into our industry as it was to us all those many years ago!

Other good advice from Bob included:

  • Use relatively new colleagues in your particular company as an ambassador for new entrants to see how they got to where they are now, as well as give advice on the pathway. Students in risk management programs can relate and identify with that person and allows them to see where they might be in the same timeframe. Companies that bring these ambassadors into the classroom tend to get a lot of resumes very quickly.
  • Get an early start – some of the best students often have jobs six months before they graduate! With a strong employment rate, it’s very competitive for good candidates.
  • Institute a formal training program for new hires. Show them they will be give the training and guidance they need to do a good job and advancement.
  • Institute an internship program, even for sophomores becoming juniors, as those students are clearly showing early interest and will be more likely to convert to employees.
  • Support risk management and insurance (RMI) education through direct recruitment at the programs, but also through scholarships and donations to the programs themselves.
  • Look outside your immediate geographic area for promising candidates. Many insurers limit recruiting to narrow geographic regions and don’t expose new hires to a full range of opportunities, nationally and internationally

All good advice to get the flow of candidates flowing!

Registration for the VCIA Annual Conference opens May 1st. We look forward to seeing many of you there for another excellent program!   Thank you and I look forward to hearing from you.

Rich Smith
VCIA President

Weather or Not

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It was recently reported that Strategic Risk Solutions Europe (SRS) has introduced a carbon emission risk program to be run in conjunction with Carbon Risk Solutions.  The program will initially involve a series of workshops where sustainability directors and risk managers are invited to learn how they can identify, manage and finance the carbon emissions risks their firms face in the transition to the low carbon economy with a range of insurance-linked solutions, including the use of captives.

Stuart King, president of SRS Europe, echoed what many have said of the broader insurance industry in confronting climate change and its associated risks: “The insurance market has been rather slow to respond to carbon risk transfer solutions for multinationals. We see an opportunity to develop these programs within captives and cells, while the commercial market develops and becomes more comfortable with this emerging risk.”

I think this bodes well for our mighty little industry. As I stated in a previous blog, captives are well placed to deal with the vagaries of climate change and risk, and that those who wait too long may be too late.

VCIA continues to address and explore this issue with a number of sessions at our Annual Conference this coming August 7-9.  Our session Natural Catastrophes and their Impact on Risk Management will feature experts  sharing information on the potential impact of natural catastrophes on  risk management from a variety of viewpoints including  academic, actuarial and risk management.

The expert panel for this session includes:

Gillian Galford, an Earth Systems Scientist at the University of Vermont and lead author of the Vermont Climate Assessment; Howard Kunst, Senior Modeler and Chief Actuary, at CoreLogic; Jason Shafer, Professor of Atmospheric Sciences at Lyndon State Colleges, who focuses on the valuation of weather information within the private sector; and Brad Waldron, ‎Vice President, Risk Management at ‎Caesars Entertainment Corporation.

Registration for the VCIA Annual Conference opens May 1st. We look forward to seeing many of you there for another excellent program!   Thank you and I look forward to hearing from you.

Next Gen

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So Millennials, welcome to the “name-that-generation” world. Starting with Baby Boomers, the X, Y and Z Generations, we humans can’t help ourselves when it comes to putting every generation in a neat, new box. And then the fun stuff comes: we older and “wiser” generations bemoan something about the work ethic or their shaving habits. Millennials have been described as everything from more self-centered to more worldly and charitable, and we in captive insurance need to understand this new “thing” if we want to fill our aging industry with new blood.

Well, I don’t buy it. Yes, every generation has its quirks and trends and signature “look” to some degree, but the young people I talk to who are looking at careers in the captive industry remind me why I have hope in darker moments. They are inquisitive, hardworking and want to help others. Yes, they want a better work-life balance, but who the hell doesn’t! In short, they remind me of every generation of young people looking to enter the workplace, make a mark and do good.  While every business and organization should strive to create a welcoming environment for newcomers, and look at crafting a new and better environment that works for all of us, let’s be careful about pigeonholing our younger colleagues and new entrants to our world. I would even suggest dropping the label Millennials and just treat them as the humans they are. After all, it will be their world tomorrow!

In the meantime, we do have a number of sessions at VCIA’s conference  August 7-9 focused on helping the next generation move into the world of captives, including Bridging the Next Generation of Leaders with Current Leaders, Presenting to Board/Management, and a Young Professionals Forum.

Registration opens May 1, so put it on your calendars!  Thank you and I look forward to hearing from you.

Another Year, Another Bill

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I want to thank all those VCIA Members who travelled to Montpelier last week during one of our ongoing snow storms to join Vermont Governor Phil Scott in signing this year’s captive bill into law.

H.764, introduced during VCIA’s Legislative Day in  January, quickly made its way through the legislative process and on to the Governor’s desk a week or so ago. Every year, VCIA and the State work to improve the ease of doing business in Vermont by proposing refinements to Vermont’s captive bill. This year’s bill included some common-sense changes to our annual filing date and reporting requirements which will help streamline processes and provide a new level of consistency for our regulated entities.

As Governor Scott said at the signing, “It is critical that we are responsive to the needs of the industry. These improvements to our captive legislation illustrate Vermont’s ongoing commitment to the captive insurance industry…  This bill will further advance Vermont’s reputation as the ‘Gold Standard’ of domiciles and will provide greater flexibility and consistency for our companies going forward.”

Joining the Governor was Department of Financial Regulation Commissioner Mike Pieciak, Deputy Commissioner Dave Provost, Director of Financial Services Ian Davis, and a number of DFR staffers. With me were VCIA Members Jonathan McKenzie from Alterna, Pattie Henderson from SRS, Dustin Partlow from JLT, Steve Killoran from Maple Capital (straight from maple sugaring – or so he looks in the picture!), Sandi Prescott from Performa, David White from AIG, David Angus from The Angus Law Firm, Keith Jones from National Life, Kristen Sharrow from Johnson Lambert, and Bill Mourelatos and Patti Pallito from Aon. Thank you all for coming on down!

Thank you and I look forward to hearing from you.

Rich Smith
VCIA President

Good NRRA; Bad NRRA

AAEAAQAAAAAAAAzPAAAAJDNkYzk4YzczLTZlYzYtNDM3NS05ODUzLTdmNDVjNDM3MDc3NgI just returned from the annual NRRA conference in Chicago last night. I know, NRRA conference? I talk a lot about fixing NRRA in Washington (maybe incessantly) but this the “good NRRA” I am talking about: The National Risk Retention Association; not the Nonadmitted and Reinsurance Reform Act.

Since Vermont is home to almost half of all RRGs licensed, it is a little like old home week in the Windy City. Many of the panelists are Vermonters or have strong connections to VCIA, such as Dan Labrie, Clare Bello, Stephanie Mapes, Michael Bemi, Nancy Gray, Tina Truex McCuin and Tim Padovese. Yours truly moderated a panel of professors and students from two risk management programs in Chicago for a very interesting view on what the industry needs to do to attract (and hold) the next generation of RRG leaders. Of course, DFR luminaries Dave Provost and Sandy Bigglestone were on two different panels providing their sought-out thoughts and wisdom on a number of issues affecting the RRG world.

Congratulations to Michael Bemi who was awarded the Karen Cutts Visionary award. This award is named for Karen who was an inspirational leader and advocate for the risk retention industry and the founder of the Risk Retention Reporter. Michael recently retired as President and CEO of the National Catholic Risk Retention Group and truly lives up to the accolades of the award. Even though retired, the good news for all of us at VCIA is that he will be joining us next year at our conference as a recently minted Honorary Member of the association!

Thank you and I look forward to hearing from you.

Rich Smith
VCIA President

Thoughts and Prayers

Just wanted to add VCIA’s voice of concern to all those caught in hurricanes Harvey and Irma.  We often talk in abstractions about risk assessment and property damage and insurable risk in our business when natural disasters hit, but when you see the pictures of devastation and hear about the impact to people’s lives it puts into perspective the havoc these things bring.

A bunch of Vermonters were about to head to South Carolina next week for their captive conference and just got word that they had to cancel, which I am sure is the right decision. However, we understand what a difficult one it was and how disappointing to have to reschedule (to say the least) after so much planning and hard work. Our thoughts are with our friends Jay, Jeff and all others – stay safe, our Carolinian captive family!

Thank you all very much, and I look forward to hearing from you.

Rich Smith,
VCIA President