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Marsh

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Cesar Casarez

on 31 January 2014

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Transcript of Marsh

A presentation by:
Matthew Cox
Shawn Burk

Matthew Brooks
Cesar Casarez

Chris Liddell, Senior VP
Bauer Graduate: Finance, 2002
11 years of experience
independent broker
upstream energy underwriter
Joined Marsh: Jan. 2013
From Conroe, Texas
Paid his way through college
Background
What do you enjoy as a broker?
The day-to-day challenges
Building meaningful relationships
Building a good reputation.
Marsh
Guy Carpenter
Mercer
Oliver Wyman
Group
Oliver Wyman
NERA Economic Consulting
Lippincott
- World leader in delivering risk and insurance services and solutions to clients.

- Provides global risk management, risk consulting, insurance broking, alternative
risk financing, and insurance program management services for businesses,
public entities, associations, professional services organizations, and private
clients.

- Marsh is organized by client, industry, and risk categories to facilitate the global
delivery of highly specialized products and services covering a wide spectrum of
risks.



- Global consulting leader in talent, health, retirement and investments that helps
clients around the world advance the health, wealth and performance of their
most vital asset - their people.




- World's leading risk and reinsurance specialist, creating and executing
reinsurance and risk management solutions for clients worldwide.

- Provides risk assessment analytics, actuarial services, highly specialized
product knowledge, and trading relationships with reinsurance markets
throughout the world.




There are three parts to the Oliver Wyman Group



Oliver Wyman is a top-tier global management consulting firm that combines deep industry knowledge with specialized expertise in strategy, operations, risk management, organizational transformation, and leadership development. 





NERA Economic Consulting advises corporations, law firms, and government entities on the economics of competition, regulation, public policy, finance, and litigation.





Lippincott helps clients create, develop, and manage their corporate branding, identity, and image. 





Financial Performance
Locations
Marketing Edge
MMC is headquartered in New York, NY
MMC is the 228th largest corporation in the US (2013 Fortune 500 List)
MMC 3 year stock price
Jan 2011: $27/per share
Jan 2014: $45.92/per share

MMC, 2013:
$ 11.9 billion in revenue
$ 1.176 billion in profit
Marsh generated approx. 45% of MMC total operating segment revenue in 2012
Background
MMC has 54,000 employees in over 100 countries
Marsh has 27,000 of those employees in approx. 380 offices in 89 countries to serve clients in more than 100 countries
Diverse Workforce
Rich History
Inclusive Culture
Advantage of Partnering with colleagues of other MMC subsidiaries
The Broker
What is the energy business?
The "middle man"
Other Roles of Broker
- Development of new products

- Market Analysis

- Peer Benchmarking

- Distribution Network for underwriters
sophisticated systems that are available to insurer which enables them to see their market share and the availability of additional business they can handle

- Broker fulfills key administrative functions related to tax
regulation
How are brokers chosen?
- Client usually identifies many possible brokers (RFP)

- Certain criteria will define most likely candidates
What is the brokers clientele? What is their experience with certain risk

- Brokers are usually asked to present a conceptual proposal
based on set of requirements particular to the needs of the
proposed client
Information
Marsh's energy professionals are divided into three sectors:
1. Upstream
2. Downstream
3. Renewable Energy
Upstream
Downstream
Renewable Energy
Exploration and Production
- Search for potential underground or
underwater energy fields

- Drilling exploratory wells

- Drilling and operating the wells that
recover and bring energy to the
surface
Refining
- Processing, cleaning and refining
crude oil

- Processing and purifying raw
natural gas
Wind and Solar
- all types of energy that do not
reduce the world's natural resources

- Marsh's energy sector consulting in
renewable sources is dedicated to
wind and solar energy
Broker
The broker is the impartial adviser who helps best assimilate the risk faced by the clients to the products in the market
Client
Insurer
The insurer is the provider of products in the market. The insurer is contracted by the broker to try and enlist quotes and different types of policies regarding the clients situation
The client is the company searching for
insurance or other risk assessment
Major companies are known to go through brokers to assist their search for insurance
- The broker represents the client and is the person to
speak to the insurer directly (no bias).

- broker helps remove the peaks and troughs of a business
Why is the broker important?
Benchmarking: significant amount of data from current and past clients
Gain in depth knowledge of clients/business operations
Review current insurance policies to ensure adequate coverage
Gain understanding of years losses and past experiences

Broker:
Objective: get the right deal at the right price
Always interested in what deals have been done and for how much
Looking and current policy and offering improvements

Broker's Team
Companies that are:
Financially stable (A.M. Best, S&P Ratings)
An understanding of the industry in which the client operates
Have a proven track record in: underwriting, product knowledge, risk management capabilities, and claims capabilities

Broker and Underwriter Relationship:
Work closely together to find a competitive price for client
They will gather information from benchmarking, and previous clients to tailor the beast deal possible

Marketing Plan
Identify
Identify two or three leads markets who offer competitive pricing and coverage

- Questions you may ask yourself?
- What limits of insurance do we need based on the operations of the
insured?
- What is the underwriting capacity of each market required to fill the order?
- Do we need onshore or offshore coverage and if so what restrictions are
involved?

Prepare
Negotiate
- Negotiation is what determines a good broker. If there is a
lack of knowledge in the market, another broker could fill
the void
- Negotiations also occur with the underwriter
- Obtain optimal coverage and pricing terms and discuss all
options with the client
- Getting the best leads to customer retention
- Bind the risk with the best lead underwriter and fill the
subscription to 100% placed
Relationships with underwriters can make a broker's job less stressful; trust and faith can lead to further business
Expectations
- Set milestones for key activities

- It is easy to let marketing plans can get out of hand

- Plan months ahead (if possible) as insurance deals can take months to complete depending on complexity

- Market variability allows the broker to obtain more knowledge and allow them to grow in their career.
After the deal is done...
- Issue all binding and payment documentation

- Collect funds and pay insurers and surplus lines tax authorities

- Issue other renewal documentation
Certificates of insurance
Auto and Health ID cards
- Prepare a summary of coverage

- Issue a claims procedure manual

- Maintain appropriate follow up and ongoing contact with client
Prepare a detailed underwriting submission for all markets to review and consider
- Schedule of wells, platforms, and pipelines
- Loss History
Arrange a face to face meeting between the insured and lead underwriter
- Whether it be you traveling to the client or the client traveling to the underwriter
Questions?
Conclusions
- The importance of good relationships and a good reputation
- The success of the broker depends on the information systems they posses and their
communication with their client and the insurer
- Emphasis on trust and expectations on both client and underwriter
- There are many options given to the client.
- Right deal for the right price
- Benchmarking: past and present information
- Partnering with the right companies
- Competitive environment
Full transcript