Success stories
Alongside you, our North America partners, we have had many mutual wins and successes over the past quarter. This article highlights some of our joint success stories to inform and inspire!
Parametrics
Miller’s parametric team secure earthquake policy for one of the largest US banks
The insured is one of the largest banks in the US and is ranked in the top 300 of America’s largest public companies. The insured has significant exposure to a large earthquake in either San Francisco or Los Angeles where they hold significant sums in loans.
The local retailer sought our expertise in designing and placing a parametric earthquake structure that would respond in the event of a large magnitude earthquake, with a significant limit. Whilst the bank carries traditional indemnity-based insurance for loss or damage to property and/or mortgage impairment; the effect of a large earthquake in either city would likely cause a backlog of losses that would need to be adjusted that would invariably slow claims payment. A parametric cover guarantees payment within 30 days of a triggering event as there is no loss adjustment; while also providing the transparency and confidence of a known pay-out amount. Another benefit is that the proceeds of the pay-out can be used for any financial loss at the discretion of the bank, for example:
- Any incurred costs responding to the triggering event, e.g. any temporary measures put in place, extraordinary board meetings, press conferences, travel, accommodation, subsistence, legal costs
- Downtime to ATM network or computer networks
- Lost work hours (salaries of staff that are unable to perform their job due to disruption caused by event, e.g. unable to travel to office)
- Loss of productivity (salaries of staff that are unable to perform their usual job role because they have to respond to disruption – this is likely significant in incurred administration costs in dealing with customers)
- Loss of revenue due to any of the above
- Deductibles loss funding for traditional property policies (property damage or business interruption waiting periods)
- Insufficient natural catastrophe limits on traditional property policies
- Damage to property that is not covered under property policies
- Loss of business through closure of offices/branches
This cover could have been placed either as a derivative or as an insurance policy. Markets indicated that such cover could work better as a derivative however the insured preferred an insurance policy as they can declare this in their public filings. After sourcing the most competitive pricing, we negotiated amendments to the wording and provided explanation to resolve concerns the insured had around the affidavit that needs to be signed post loss. This met the new insurance regulations in the US around parametric policies.
The number of markets offering capacity for parametric coverages is growing; but so is the popularity among insureds, particularly for natural catastrophe coverages like earthquake, named windstorm, flood and wildfire. This will lead to a capacity crunch particularly for Gulf of Mexico named windstorm this year. We would encourage anyone seeking parametric cover to get into the market as soon as possible.
As technological improvements in modelling, data and monitoring improve, parametric policies are also able to pick up trickier natural catastrophe exposures like tornado, hail and lightning. We are also seeing more enquiries related to weather (rainfall/snowfall, temperature, irradiation, and soil moisture); as well as loss of attraction and cyber downtime.
Benefits of Parametrics
Cargo
Stock throughput (STP) enables property remarketing with TIV reduction securing successful renewal
The Miller cargo team placed a STP for one of the largest family-owned candy manufacturers operating in the USA. The insured distribute gummy products and chocolate across US and Europe from their main manufacturing site.
The local intermediary was looking for marketing options given the challenges in the property market with incumbents wanting to increase both rates and deductibles. Looking at a STP gave access to both property and marine carriers, meaning far more options available to obtain quotes. By splitting the inventory from property values, it lowered the overall limits required on the property policy, meaning the placement could be remarketed with more competitive property carriers.
Utilising one of our exclusive facilities, Miller was able to provide broader coverage tailored around the specific interest of the insured’s business operations. The result was a successfully retained property account with and the insured benefitting from improved pricing and coverage granted by the seamless and tailored protection of STP.
Cyber
Miller gathers Media Liability momentum into Sports Franchises
Miller’s cyber team recently placed primary media policies for two NHL teams following recent successes with a US wholesaler.
Historically, domestic markets have struggled to write these accounts given the high-profile nature of the clients combined with the claim’s frequency experienced in the sector. Often, domestic markets will write policies with restrictive terms and conditions. Following a review of the insured’s current policy, our team identified gaps in cover where we were confident London could step up.
Miller were able to source broader terms at more competitive pricing, which combined with our quick turnaround and expertise, proved enough to move carriers, much to the delight of the NHL teams and our wholesale broker client.
As a result, the wholesaler in question has advised that they will recommend Miller’s cyber team to all department leads nationwide, which is a great outcome for the team and should provide many more future opportunities.
Marine
Marine team’s key market relationships secure specialist primary P&I placement in Canada
Miller’s Marine team recently worked with a US wholesale broker to place hull & machinery and primary P&I coverage for an international fish farming company for their operations in Vancouver, Canada.
The win came about after local markets in Canada ceased writing the P&I element required by the insured. This coverage has always been, and remains, a very difficult part of any placement.
Miller was able to step into offer the client a solution as a result of the team’s underwriter relationships, ultimately securing the necessary coverage as part of the insured’s wider H&M/P&I package.
Excitingly, off the back of this success, Miller has already seen further similar enquiries from the producer.
Miller’s Marine team cruise to another win
This new win comes after a year-long pursuit and against a competitive local market.
Miller has worked on several enquiries with the US broker gaining an increasing amount of mutual trust and understanding. This has most recently led to a joint success securing improved P&I terms for a west-coast cruise operator.
The Miller team was competing against the local market, who were able to offer a very competitive quote with a 100% H&M and P&I package. Miller was looking to place the P&I with a P&I Club who can provide a much better level of service, but often at a more expensive rate.
However, on this occasion, Miller was able to place the P&I at a lower price than the domestic insurance market could offer.
D&O
D&O team obtains competitive terms to secure London market placement
Excitingly, working with a large independent retail broker, Miller has recently placed Primary ABC coverage for D&O and Independent Directors Liability excess coverage for a large US manufacturer. The insured is an industry-leading developer of next-generation all-solid-state battery technology.
The business was won after an introductory call with Miller’s D&O team and the producer, who had just won the account on BOR and selected Miller to place this in London. The producer was unhappy with their current London arrangements.
This was a challenging placement as the EV space is tough to insure, both domestically and in London. In this case, the domestic market did offer terms, however, due to very strong carrier relationships we were able to have the London market step up on pricing, retention and coverage. We not only secured expiring capacity but also negotiated additional layers on more advantageous terms than the domestic market.
