Beecher Carlson All Lines Presentation

Passion.Innovation.Accountability.

Welcome to Beecher Carlson!

MARA | Multivariate Algorithm for Risk Analysis (MARA) evaluates approximately 4,000 metrics to determine and assess your company’s risk drivers

passion. innovation. accountability.

Introduction to Beecher Carlson>

3COPYRIGHT BEECHER CARLSON INSURANCE SERVICES, LLC; ALL RIGHTS RESERVED; THIS DOCUMENT CONTAINS CONFIDENTIAL AND PROPRIETARY INFORMATION AND MUST NOT BE DISSEMINATED WITHOUT PRIOR WRITTEN CONSENT FROM BEECHER CARLSON, LLC

Beecher Carlson Overview

Ranked as the 6th largest insurance brokerage in the

United States and the 7th largest

brokerage worldwide by

Business Insurance magazine.

Revenues in excess of $1.58B and

places more than $13.5B of premium into the insurance

marketplace.

More than 7,000 employees with

offices in 131 cities across the U.S.,

London and Bermuda

International Correspondents located in over

100 countries and have offices in over 500 cities

around the globe. Including offices in London, Bermuda

and Cayman Islands.

Our evaluation of exposures in the pre-underwriting stage and quality

of submissions results in a Quote-

to-Bind ratio of around 40% much higher than the

industry average of 15% to 18%.

Beecher Carlson is the large account subsidiary of Brown and Brown that delivers expertise by industry focus and product specialization. At Beecher Carlson, we believe risk management without passion, innovation and accountability is just

buying insurance.


Competitive Differentiators

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We have total flexibility to use the best insurance providers, vendors, resources, foreign brokers, wholesalers, claims attorneys and forensic accountants that create a “best in breed” solution.

Nearly 40% of our Casualty staff is dedicated to claims, risk control and analytics. Our competitors average is 7-9% in claims and analytics staff.

Our evaluation of exposures in the pre-underwriting stage and quality of submissions results in a Quote-to-Bind ratio of around 40%, much higher than the industry average of 15% to 18%.

Global profit center model allows our clients complete access to our national, top-tier resources without complicated political structures or local profit center mentalities. Service teams are determined based on knowledge and clients needs rather than geographic convenience.

Strong individual carrier relationships at the highest levels.

Complete market access to all worldwide insurance markets.


Beecher Carlson Awards

Business Insurance’s Readers Choice Award 2009 was based on the best combination of: Innovation, Service, Quality and Value

Ranked #1 in Innovation in Captive Management by U.S. Captive for 2013

AutoZone's 2013 Partner Excellence AwardAward recognizes high performing partners that are leading in their industryPARTNER EXCELLENCE AWARD

2013 , 2014 & 2015 Top Insurance and Professional Services Organizations for Diversity and Inclusiveness recognized by Exelon

Captive Manager of the Year 2012 Recognized excellence in the delivery and management of captive insurance

Ranked #1 in Favorability by Greenwich Associates in 2011 based on the key attributes of: Ethicality, Flexibility, Likelihood to Recommend, Client Satisfaction, Prompt Follow-up, Addressing Policy Issues with Adequate Time Before Renewal, Compensation and Pricing, Innovativeness of Brokerage(Survey discontinued in 2012)

Business Insurance’s Readers Choice Award 2010 was based on the best combination of: Innovation, Service, Quality and Value(Award discontinued in 2011)

Ranked #1 in Favorability by Greenwich Associates in 2010 based on the Key attributes of: Customer Service, Ease of Working Relations, Flexibility, Securing Best Prices and Understanding Business Needs

Captive Manager of the Year 2015 Recognized excellence in the delivery and management of captive insurance

http://www.greenwich.com/WMA/greenwich_home/1,1630,,00.html?rtOrigin=G&vgnvisitor=eKmbnp6Ln5M=

http://www.greenwich.com/WMA/greenwich_home/1,1630,,00.html?rtOrigin=G&vgnvisitor=eKmbnp6Ln5M=


Beecher Carlson Innovations

MARA



Specializations>

Focus• Expertise in power generation with a

special focus on independent power market

• Innovative solutions for prototypical equipment, replacement power, political risk, trade disruption, forced outage, lack of resource, control of well, warranty and performance guarantee

Highlights• Placed Builder’s Risk insurance policy for

the largest wind farm in the U.S.• Developed the first project specific

Extended Warranty Wrap and Performance Guarantee program for the largest solar project in the world

• Placed coverage for the largest fleet of Frame 7 Gas Turbines (GE 7FA & Siemens Westinghouse 501F)

• Energy specific Loss Control / Claims / Captive Solutions

• Recognized expert in construction and operational coverage for independent power plants worldwide

• Out-sourced risk management platform providing cost of capital/reserving analysis, manuscript contract language, lender consultation, RMS/CAT modeling and project development and M&A consultation

Energy Casualty

Focus• Large accounts with annual expected up

to, and greater than, $100M; Alternative risk financing arrangements including, but not limited, to large deductible, deductible buy back policies, qualified self-insurance, corridor retention programs, incurred/paid retros, captive utilization

Highlights• Utilize in brokerage process and provide

to clients the analytical tools required to make educated risk financing purchasing decisions. Each risk management client has a designated actuarial and analytics team

• Utilize proprietary ZOOM® process that combines the science of predictive analytics and data mining with hands-on claims consulting and loss control engineering expertise

• Dedicate nearly 40% of staff to managing clients’ retained losses (90% of their total cost) through claims, risk control and analytics, versus competitors 7-9%

• Team setting strategy and executing that strategy in the market continues to service the client throughout the life of the program 24/7/365

Beecher Carlson Specializations

Real Estate

Focus• Office complexes/towers, large

apartment owners and shopping centers

• Specialize in soft occupancy companies with large CAT exposures (wind, flood and earthquake)

Highlights• Pre-underwrite risk by running

our proprietary CAT models• Expert in utilizing Tenant Liability

insurance to benefit owner/managers as well as tenants


Focus• Managed Care

(provider, employer and HMO stop loss)

• Academic Medical Centers

• Healthcare Systems (Acute, Long Term Care, Psychiatric, Ancillary Care)

• Physician Groups

Highlights• Largest division of

Beecher Carlson• Proprietary PULSE™

technology allows information access for healthcare professionals

Healthcare Hospitality Manufacturing

Focus• Large hotel owners

and managers (>20)• Gaming and tribal

properties• Issues such as

legionella exposures, bed bugs, food borne illness and guest properties

• CAT exposed properties

Highlights• Leading broker in the

hospitality industry• Design programs with

proprietary software, RiskConcierge, to reduce total cost of risk

• Proud partner of the American Hotel & Lodging Association, having prepared their annual loss cost study for the past 18 years

Focus• Strong focus on

automotive companies, warehousing facilities, distribution and food related companies

Highlights• Utilize ZOOM® to drive

down workers’ compensation costs

• Create crisis communications plan with recover options to reduce business interruption from product recalls

Focus• Hedge funds,

investment advisors, community banks, transfer agents and insurance companies

Highlights• Proven algorithms

analyze thousands of data points to determine the likelihood and severity of incurring litigation

• Design programs to protect boards and investors in a regulatory investigation

• Review cyber risk to ensure a long-term, stable program

Financial Services

Focus• Specialize in single

parent and association captives as well as risk pools and Risk Retention Groups (RRG)

• Develop alternative risk finance solutions that solve insurance needs and generate profits in a tax efficient manner

Highlights• Manage >100

captives across 10 major domiciles ranking us 3rd largest captive manager in the world

• Only captive manager to invest in specific audit policies and procedures

• Team includes on-staff actuaries, CPAs, MSAs, JDs and software specialists


Focus• Public or large private

companies with an employees base of 2,500 or higher

• Fortune 1000, now expanding to 2000

Highlights• Provide objective, data-

driven knowledge in order to mitigate severity and frequency

• Utilize MARA, our proprietary set of modeling applications, to evaluate risk drivers along 4,000 data points

• Five lawyers on staff to support claims advocacy

Executive Liability

Focus• Specialize in soft

occupancy companies with large CAT exposures (wind, flood and earthquake)

Highlights• Evaluate programs for

gaps in structure, terms and conditions

• Superior analytics bolstered by fast, accurate modeling (45 minutes versus competitors 2 week turnaround)

• Proprietary LiNK technology creates customized match of premium to actual exposure

Property Captive Management

Focus• Large semiconductor

and capital equipment manufacturers

• Hardware and software technology companies

• Networking, Social Media, Internet Services, Bitcoin

• Cloud, SAAS, and Internet Security Companies.

• Medical Device, Biotechnology, Pharmaceutical

Highlights• Ability to handles large

multinational programs in multiple countries

• Handles selective technology start-ups

• Ability to handle global clinical trials

Technology/Life Sciences


Why Direct?

How We Access the Marketplace

Domestic Marketplace

Excess & Surplus Lloyds of London /

European Markets Bermuda Markets

Beecher Carlson

Domestic WholesaleBroker London Broker Bermuda Broker

• Facilitates the insured’s ability to interface with their underwriters.• Direct negotiations with underwriters maintains control over what message is being delivered to the markets.• Reduced frictional costs. Wholesale brokers should only be utilized for those markets retail brokers cannot

approach on a direct basis. We have access points at the highest levels of all major carriers.



Casualty Capabilities>


Beecher Carlson Casualty Practice• The largest segment within Beecher Carlson

• Approximately 85 staff members in the four major hubs:– Atlanta, New York, Woodland Hills, Nashville

• Nearly 40% of our Casualty staff is dedicated to claims, risk control and analytics because nearly 90% of your cost is based on your retained losses– Our competitors: average 7-9% in claims and analytics staff compared to the

Casualty staff

• Manage more than 85 national accounts

• Our staff includes senior industry pros supported by depth at all levels

COPYRIGHT BEECHER CARLSON INSURANCE SERVICES, LLC; ALL RIGHTS RESERVED; THIS DOCUMENT CONTAINS CONFIDENTIAL AND PROPRIETARY INFORMATION AND MUST NOT BE DISSEMINATED WITHOUT PRIOR WRITTEN CONSENT FROM BEECHER CARLSON, LLC

You Are The Largest Insurer on Your Risk

P R E M I U M

S E RV I C E

U N I N S U R E D

LO S S E S

“You should think like an insurer….we will inform you and provide you with the tools to do just that.”


LO S S E S

Casualty Analytics

ACTIONABLE ANALYTICS

The analysis we perform allows us and YOU to identify the key areas to attack to reduce the cost of the largest percentage of losses you retain.

CLAIMS MANAGEMENTOur analytics enable us to identify the most potentially costly claims, the best/worst adjusting performances and the most efficient means to close claims economically to obtain the lowest possible cost.

OPERATIONAL ENHANCEMENTS

We look at the where, how and why drivers of your claims and establish a joint task force to make changes to how your people and operations do their jobs in a way that prevents accidents from happening at all.

“We empower our clients to make educated buying decisions about their risk financing and how to attack and reduce their claim costs.”

CLAIM MANAGEMENT & RISK CONTROL• ZOOM®/Enhanced Claim Management• Operational Assessment• Data Integrity• Claims Administrator Management• Claim Audit/Best Practice• Safety Program Evaluation

LOSS ANALYSIS• Loss Projections• Retention Analysis• Monte Carlo Simulations• Collateral Analysis• Loss Emergence Schedule• Scorecards – Measure KPIs

EDUCATED DECISION MAKING TOOLS

• Net Present Value Analysis• Cost of Capital Analysis• Retrospective Adjustment Simulations


Client Results

Rolling 12 Month New Client Results...Account Wins From Other Major Brokers or Direct Writers:

AVERAGE RATE

REDUCTION

15% Market average was 4% rate increase over same period

COLLATERAL IMPACT

12.5% Average reduction on go-forward collateral amount

31% Average reduction on existing

collateral amount



ZOOM®>

COPYRIGHT BEECHER CARLSON INSURANCE SERVICES, LLC; ALL RIGHTS RESERVED; THIS DOCUMENT CONTAINS CONFIDENTIAL AND PROPRIETARY INFORMATION AND MUST NOT BE DISSEMINATED WITHOUT PRIOR WRITTEN CONSENT FROM BEECHER CARLSON, LLC 18

TCOR100%

Beecher Carlson FocusTraditional Broker Focus

INSURANCE CHARGE

7.1%

Total Cost of Risk


Better Results: Provided by Beecher Carlson

BEECHER’S

ZOOM® PROCESS

GETS BETTER RESULTS

• 14% Average Reduction on Projected Ultimate Incurred • 29% Average Reduction on Reserve Liabilities• 31% Average Reduction on existing collateral • We have mitigated our client claim cost by $215,041,280

in the last two years• Insurers will accelerate a reduction in collateral for ZOOM®

clients • Insurers will lower deductible / excess workers compensation

premiums on ZOOM® clients • With ZOOM® analytics, we present a stronger marketing

submission

19


What is the ZOOM® Process?

20

PROCESS SOLUTIONS

JOINT STEERING COMMITTEE AND STEWARDSHIP /

ACCOUNTABILITY

STRATEGIC CLAIM FILE MANAGEMENT

HISTORICAL CLAIMS

CURRENT CLAIMS

PROSPECTIVE CLAIMS

CLAIMS / PREDICTIVE MODELS

CAUSE & EFFECT / ROOT CAUSE

SCORECARDS & GOAL TRACKING

SOLU

TIO

NSO

LUTI

ON

SOLU

TIO

N

ZOOM® SYSTEMATICALLY PINPOINTING “CRITICAL FEW” OPPORTUNITIES FOR IMPROVEMENT

LOSS DATA ANALYTIC TOOLS SOLUTIONS


ZOOM® Analytics - Baseline Assessment

21

• Data Run by 32 Key WC Performance Indicators (KPI’s)

• Establish Baseline Outcomes

• Provide Suggested Goals and Objectives by Policy Year

Program Period PY14(1/1/14 - 1/1/15)

valued as of


valued as of


valued as of

KPI's7/31/14

(7 Months)7/31/13

(7 Months)7/31/12

(7 Months)PY14 vs PY13 PY14 vs PY12

Ultimate Incurred $9,600,000 $7,633,000 $9,070,000 26% 6%1. Total claim frequency 257 276 270 -7% -5%2. Total incurred $2,579,193 $1,638,613 $1,110,304 57% 132%3. Total paid $775,172 $641,729 $475,017 21% 63%4. Average incurred $10,036 $5,937 $4,112 69% 144%5. Average paid $3,016 $2,325 $1,759 30% 71%6. Closed claims 199 207 220 -4% -10%7. All claims closing percentage 77% 75% 81%8. Indemnity claims 56 45 28 24% 100%9. Indemnity claims percentage 22% 16% 10%10. Average incurred indemnity $40,119 $25,705 $24,125 56% 66%11. Average paid indemnity $10,437 $7,590 $7,834 38% 33%12. Indemnity closed claims 17 7 5 143% 240%13. Indemnity closing percentage 30% 16% 18%14. Open indemnity claims 39 38 23 3% 70%15 Top 10 claims incurred $1,637,252 $570,206 $453,734 187% 261%16. Top 10 as % of total incurred 63% 35% 41% 82% 55%17. Medical Only claims 201 231 242 -13% -17%18. Total paid Medical Only $190,698 $300,195 $255,674 -36% -25%19. Average incurred Medical Only $1,654 $2,086 $1,797 -21% -8%20. Average paid Medical Only $949 $1,300 $1,057 -27% -10%21. Med Only closed claims 182 200 215 -9% -15%22. Med Only closing rate 91% 87% 89%23. Payroll per $100 $3,400,000 $3,400,000 $3,482,763 0% -2%24. Incurred per $100/payroll $0.76 $0.48 $0.32 57% 138%25. Employee Count (Avg) 0 0 0 - -26. Incurred per EE Count - - - - -27. Frequency rate per 100 FTE's - - - - -28. Unit Count (Avg) 0 0 0 - -29. Incurred per Unit Count - - - - -30. Claims with lost work days - -31. Lost Work Days - -32. Average Lost Work Days - -

Initial Scorecard Baseline AssessmentKnowing precisely where and howto focus to lower your cost of risk

2014: Goal – 6.5% improvement to the average cost per claim (ACPC) when compared to 2013 at 18 months (no adjustment for inflation or salary increases)– $700k reduction - undeveloped – 28% indemnity percentage

2013: Goal – 6.5% reduction to the existing 9% increase in the average cost per claim trend in 2012– no adjustment for inflation or salary increases– $900k reduction - undeveloped

2012 and older: 621 claims – target reduction: $2.4M reduction (excluded excess claims)

Aggregate Incurred Reduction Target: $4M (approx.)

Current Claims

Prospective Claims

HistoricalClaims


ZOOM® Analytics - Cause and Effect

22

• Conduct “deep dive” analysis to pinpoint causation or root cause of any adverse outcomes

– Litigation Cost / Duration – Medical Cost / Duration

– Indemnity CAT Scan

– Adjuster Performance

• Measure KPIs of the critical processes that drive or contain 80% of the outcomes and establish goals for improvement


ZOOM® Timeline

23



Property Capabilities>


We challenge every aspect of your program to build market momentum through an integrated team approach.

Broking Style

• Pre-Underwrite Each Risk– Analyze the Total Insurable Values (TIV)– Determine the MFL and PML estimates for “critical” exposures– Review the historical loss records– Examine available engineering/loss control reports– BI values and geo-radius tool

• Advantages Gained from Pre-Underwriting – Determine the appropriate amount of “critical” limits to purchase– Proper layer breakpoints– Layering structure (i.e. quota share or “stacked” layers)– Potential roadblocks are identified to help better position your company– Identify and reach target markets– Identify target pricing


Our Technology and Risk Modeling Solutions

• Claims• Loss control• RMS – Catastrophe modeling• Mapping capabilities• Radius Tool• Google Earth Pro – “Not your desktop Google Earth”• Premium allocation• LiNK - Proprietary rating tool



Executive Liability Capabilities>


Executive Liability Overview

ELP

The Executive Liability Practice (“ELP”) is a Beecher Carlson specialty practice made up of experienced and knowledgeable advisors/brokers solely dedicated to providing our clients with the advice needed to properly protect corporations and their directors and officers against unforeseen liability that arises from everyday corporate activities.

Products

• Directors & Officers Liability

• Fiduciary Liability

• Employment Practices Liability

• Professional Liability

• Cyber Liability • Crime Insurance• Kidnap/Ransom

& Extortion Insurance

New York

Atlanta Bermuda

San Francisco

• Industry Expertise (Healthcare, FI, Oil & Gas, Private Equity, Life Sciences, Retail, Distressed Co’s, Hospitality, etc.)

• Focused Resources – have 18 dedicated resources in D&O & Executive Liability Insurance products

• Legal Leverage – 5 person Dedicated Claims Staff (all attorneys)

Boston

ELPKey Drivers ELPFootprint


Executive Liabi l i ty Cl ient Results

PERFORMING FOR OUR CLIENTS

SETTLED LARGEST

ADA CLAIM

$20M

PLACED LARGEST CYBER PROGRAM LIMITS

$500M

3RD

PLACED TRANSACTION POLICY FOR THE 3RD LARGEST MERGER & ACQUISITION DEAL


Forward-Looking AnalyticsDirectors & Officers Liability Analytics Output

MARAEstimates the likelihood that the firm will have an SCA claim filed against it in the next 12 months and places it into a risk quartile based on this estimate

Assumes that the firm will have an SCA claim filed against it in the next 12 months and places it into a risk quartile based on the likelihood that this claim will be dismissed

Assumes that the firm will have an SCA claim filed & settled against it in the next 12 months and estimates potential settlements amount at various confidence levels

Underwriting

Benchmarking KnowledgeBecause we analyze approximately 4,000 data points — several times more than any other brokerage —you will know more about your risks than ever before and can compare and contrast your results with those of your peers. Using inputs from broad data sources, we provide an objective risk assessment score relative to comparable organizations and an estimation of the likelihood and severity of future securities class action, which forms the basis for adjusting both insurance limits and retentions.

Our analytical insight is highly persuasive, objectively demonstrating to carriers the facts supporting your unique risk profile. Knowledge of specific positive or negative risk factors means no surprises for senior management at underwriter meetings. And, it provides powerful intelligence to facilitate underwriter negotiations to ensure you the best terms, conditions and pricing.


– We represent your interests before the carriers– Our clients come to see us as an extension of their risk

management function– We have more high-profile, complex experience than any

other broker – We evaluate claims history to spot loss trends and offer

guidance on reducing your exposure to future claims– We use our experience handling your claims to look at

opportunities to enhance coverage going forward.– We furnish our clients with timely, relevant content that

impacts their Executive Liability programs.

Claims Advocacy

When the worst happens in the boardroom, you need the expertise and experience of the industry’s most robust and well respected Claims Advocacy team. Beecher Carlson’s claims advocacy group has an emphasis on advocacy, not just claims management. Our claims advocates work with you, advising you on how to best mitigate trouble, rather than only stepping in after litigation is filed.


Claims Management Process

Blocking and Tackling Managing Expenses

Negotiating with Insurers Risk Prevention, Mitigation and Education

• Initial reporting of claims• Analyzing reservation of rights• Analyzing correspondence that evidence their view of

coverage• Consulting with you as to the most appropriate form of

response• Drafting response letters for your review and approval• Gaining insurer approval of defense counsel & other

supporting experts you may choose to engage in the defense of claims

• Monitoring the claim activity until it matures into a resolution phase

• Closely track and monitor insurer payments for you• Ensure that payments in accordance with the terms of the

policy are made timely and accurately• Handle all defense expense issues with the insurers

eliminating unnecessary distraction and allowing you and your counsel to exclusively focus on defending counsel rates

• Compliance with litigation guidelines/budgets• Recognition of exhaustion of policy retentions and

appropriateness of deductions by insurers• Challenge insurer positions ensuring that you are

optimizing your ability to obtain recoveries under the policy

• We are on your side. In the event of material coverage issues or recalcitrant insurers, our objective is to bring the key decision-makers, both on the claims and underwriting side if necessary, to the table with the intent of supporting you in the resolution of claims. That support is usually, but not always, in the form of financial contributions; however, it is always our goal to have someone from the insurer with financial signing abilities available in the event of settlement discussions including mediation or arbitration proceedings.

• We are prolific in the number of white papers we produce on recent case decisions of impact for our clients including changes in legal and regulatory requirements and claims trends. We can research issues for you and produce a position paper on a subject of concern or interest to you. One of our fundamental tenets is that an ounce of prevention is worth a pound of cure and so our mission is to reduce your dependence on the commercial insurance market in any area where you can produce greater results for your company, employees and shareholders by preventing a shock loss in the first place. Insurance, in our view, is no panacea for the reputational and other damage that ensues in the event of a major corporate governance and financial scandal.


Claims Advocacy and Consulting

Risk Prevention, Mitigation & Education

Blocking and Tackling

Managing Expenses

NegotiatingClaims

Advocacy

Claims reporting oversight

and assistance

Coverage response and

advocacy

Advocacy on specific claim

issues and strategies

Claims renewal

oversight and

assistance

Review billing terms

and conditions

BEYOND JUST CLAIMS REPORTING



Cyber Liability Capabilities>


CyberSelect™Data breaches have become more and more prevalent. Given the press surrounding the size of such instances (the number of files breached and people affected), companies have begun to realize the resulting costs can be staggering. Companies should not have to worry about whether their policy fully or partially responds, it should be comprehensive, complete and not riddled with sub-limits.

Beecher Carlson has a proprietary Cyber Liability and Data Breach Response policy – CyberSelect™. The policy is designed to offer the most comprehensive coverage available in the market and offers many enhancements not typically available, such as:

• Eliminates the need to gain consent from the Insurer to hire legal experts, forensic accountants and public relations consultants allowing a rapid response to a data breach

• Provides full policy limits for costs arising out of any regulatory investigation by any regulatory authority or the Payment Card Industry Security Standards Council including card company fines, penalties and assessments, as well as credit card reissuance costs

• Includes Business Interruption and Extra Expense at full policy limits and extends coverage for “contingent” business interruption and extra expense to the insured as a result of acts of third party vendors

• Includes Media Liability coverage for all publications, including false advertising through electronic or written means

• The ability to add professional liability to the coverage• Primary limits available up to $50 million


Understanding Cyber and Tech Exposure

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Number of Notices

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Risk Assessment: identifying and prioritizing technology, cyber and E&O risk

Privacy Risk Modeling: customized data breach impact-analysis of severity and frequency for breach of confidential information

Gap Analysis: identifying the gaps and overlaps in relevant programs and making recommendations

Business Impact Analysis: with Procor, providing pre-risk revenue impact assessment and post-breach response and audit services

ePHI Notification Cost Per Record


Beecher Cyber Analytics ReportBeecher Carlson’s Cyber Analytics modeling takes into account the industry, the type of information lost/breached and can also take into account the breadth of coverage under the cyber insurance policies purchased to estimate probable maximum loss scenarios. Information provided by the model includes:

• Probable maximum loss: provides an estimated maximum cost of a PII breach based on the number and types of records held by the company

• Breach Estimates: provides estimates of the size and resulting expense of a breach based upon a “1 in 200 company” breach event (note: this can be reset at other levels at the Insured’s discretion)

• Information for contract negotiations: provides a tool to help Insureds negotiate liquidated damages, indemnity and insurance provisions with vendor contracts

• Risk Register: a top cyber and tech risks as developed by Beecher with Northwestern in a workshop or question format

The analytics report can be expanded to include:

• Vendor Management Tools: example language and guidance on requesting Cyber and E&O insurance from third parties technology and related service providers


Beecher Carlson Online Breach Cost Tool

Cost Per RecordCost of a Breach


Consequences of a Data Breach• Directors, officers and employees are subject to termination• Costs to comply with notification to consumers/employees, credit monitoring costs,

cost of restoring Data / Public Relations– Privacy response cost: $5 -$25+ per individual (Our estimates are lower than the

research estimates)• Civil penalties and fines• Class Action suits• Individual civil actions• Legal and defense costs:

– Civil, regulatory and possibly criminal defense– Data Privacy counsel can cost $700 per hour. A major data breach will cost

millions in legal costs• Business Interruption Costs• Corruption or destruction of data• Theft of funds or property• Extortion• Reputation loss



Mergers and Acquisitions Capabilities>


National Private Equity/Mergers and Acquisitions Services

1

2

3

4

5

6

7

Purchase agreement evaluation

Loss history analysis

Actuarial valuation of self-insured obligations

Historic insurer solvency analysis captive subsidiary audit

Analysis of coverage terms and conditions

Competitiveness of pricing and go-forward estimates

Portability of program

Pre-Closing DiligencePre-closing diligence services: • Financially oriented diligence product• Focus on the expense and efficacy of

the insurance program currently in place.

In terms of Property & Casualty and Employee Benefits, this offering includes,

but is not limited to, the following:

• Specialize in: pre-closing insurance, employee benefits solutions, aggregated insurance platforms and transactional risk solutions

• Large and middle market private equity firms, infrastructure funds, alternative asset managers and corporate clients

• Averaging more than 13 years of experience

• Worked on over 5,000 transactions


Procurement Strategies

Port

co A

Port

co B

Port

co C

Partially Shared• Single, centralized trading platform

based in New York– Trade directly with New York underwriters

for increased marketplace leverage

• Myriad of approaches, – Fully integrated and shared, partially shared

or standalone programs

• Post-close placement results in:– Enhanced terms and conditions– Maximized cost savings for Portfolio

Company and Private Equity Sponsor

• Transactional Risk Solutions for issues related to:– Indemnification length, breadth, scope– Assumed and/or operational environmental

liability– Specific contingent liability solutions



Captive Capabilities>


Captive Management StatsACTIVE IN 10 DOMICILES 3rd LARGEST

CAPTIVE MANAGER IN THE WORLD

2013 INNOVATION IN CAPTIVE MANAGEMENT AWARD

OVER 100CAPTIVES

2015 & 2012 CAPTIVE MANAGER OF THE YEAR


Captive Services

Three Phase Approach

1 Feasibility Study – Examine your current program and historical loss experience to outline specific components to operate an alternative program and assess potential cost savings and operational advantages.

2Plan Design and Options – Design the most optimum alternative program for your business including actuarial loss projections, business plans, financial projections, application and licensing, fronting and reinsurance design and placement as well as claim handling design and placement.

3 Program Management – Combine our insurance knowledge, innovative problem-solving capabilities and exceptional experience in sophisticated program management to integrate your program on schedule and within your budget.



Environmental Capabilities>


Environmental Services

• Specialization in environmental risks• Deep understanding of environmental risks• Provide in-depth environmental risk

reviews– Risk exposure– Risk prioritization– Risk quantification– Risk mapping– Coverage review



International Capabilities>


Our International Practice• Experienced International Practice with extensive Insured and Brokerage

backgrounds provides global coordination

• Currently servicing large multi-national clients and managing placements in more than 100 countries

• International consulting (assessment):– Insurance regulations and practices worldwide– Local exposures and policy placement requirements– Local broker representation where required and/or warranted depending on

local regulations, number of local policies, complexity of local coverage and claims involvement

• Member of Worldwide Broker Network (WBN)


International Assessment

What is driving the need to addressthe issue?

What is the exposure to client if a policy is not procured?

Are there local regulatory/compulsory requirements driving the need for purchase?

What insurance solutions are available?

Reasons Why Insureds Buy Local Policies:• Premium and Tax Requirements

– Does premium have to be collected locally?– Transparency in how and where premium is collected.– Are taxes applicable?

– Will the local government assess any penalties and/or fines if a local policy is not purchased?

– Is centralized or decentralized risk management philosophy followed?– Presence of local leadership? Is a local Executive requesting a local

policy?– Does the government or local contract require an insurance policy be

placed locally?• Is non-admitted insurance accepted?– Can the global policy service and make a payment locally if there is a

claim?– I.E. If the master global policy cannot make a claim payment

locally and the parent company reimburses the local subsidiary, does the parent company risk tax and penalty liability where it is domiciled?


Worldwide Broker Network (WBN)World’s largest fully integrated network of independent Property and Casualty and Employee Benefits Brokers in the world:• In more than 100 countries throughout the world

• Serviced by 15,000 professionals

• Placing $28 billion in premiums in the global insurance market

WBN is a collaborative network, independently owned:• Over 20 years of WBN Member-to-Member loyalty and responsiveness

• Mandatory service standards within the network

• 360 Degree Peer Review of WBN Members

• Client objectives clearly communicated and executed at all worldwide locations

• Market and arrange all classes of insurance coverage

• Provide risk management consulting services

• Highest level of service to all clients of any size, industry or location

• Technology enabled global management and delivery system customized for our clients


Value of an Independent Network

You have direct Access to the Owners and Senior Management of our WBN Partners

Expense structure allows your company and the WBN to match our income to the level of service delivered locally

Incoming business both large and small treated the same: with HIGH priority

Powerful web-based collaboration system with no additional technology license fees

Detailed International Service Instructions are developed and deployed to meet client needs

Your company’s relationships at Senior levels improves the quality and consistency of local service

Owned networks often carry minimum fees per country that inflates broker’s compensation

Owned networks place higher priority on indigenous income producing business

Data and information services are often offered subject to additional user fees

Standard service levels established corporately with little local flexibility allowed

Client Benefits vs Owned Network Approach

Flexible Network structure allows you to work within or outside of the WBN network to match your needs

Owned networks often require clients to work exclusively within their network structure

Why companies value an independent Network?

WBN firms have low management and employee turnover due to corporate and network structure

Consistent level of client service on both a local and global basis


Global and Local Policy Management

(Parent Company)

Foreign Subs Foreign Subs Foreign Subs

Insurance Carrier

Local Insurance Carrier Local Insurance Carrier Local Insurance Carrier

Beecher Carlson places Master DIC/DIL Policy

Beecher Carlson Coordinates locally admitted coverage with International Partner Network (WBN).

Beecher Carlson All Lines Presentation

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Transcript of Beecher Carlson All Lines Presentation