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THE HARTFORD: Supporting A Flexible Approach to Offer Long-Standing Profitable Programs

Featuring Richard Suter, Assistance Vice President, Program Business Development, Captive & Specialty Programs

Posted on 06 Oct 09

In this issue, we are proud to feature The Hartford, set to celebrate a milestone bicentennial anniversary in 2010, and one of our newest Storefronts. We spoke with Richard Suter, AVP, Program Business Development, which is part of the Captive & Specialty Programs department at The Hartford. The group consists of 65 employees primarily out of Hartford, Connecticut and Boston, Massachusetts. Richard has been in this position for four years, and during this time, he and his dedicated team have been committed to developing new programs.

There are 49 active programs today, with 22 of these having been developed since the team has been in place. Additionally, The Hartford supports various program models. “We try to approach the marketplace with flexibility,” says Richard. “We’ll set up a program with a retailer who has no desire to underwrite, and we will work with more sophisticated program administrators who want to underwrite, perhaps have their own TPA, loss control department and want to conduct the marketing as well. We try to plug into all types of program models.”

The department has two major categories of program development: Captive Programs and Specialty Programs. “We are unique in the marketplace because we have these two categories of programs together within one division,” says Richard. “In theory any program administrator who wants to share risk can do so seamlessly with a captive, and if an administrator wanted to come out of a captive but keep the program intact without risk sharing, we could do that as well.”

With Captive Programs, the focus is on the concept of risk sharing. “The idea is that when our partners have ‘skin in the game’ it’s good for everyone,” explains Richard. The Captives can either be owned by agencies, associations/franchises, or by the accounts themselves, known as Group Captives. “The owner of the Captive is in a risk position so when things go well, everyone profits handsomely. If things go poorly, there is a negative impact. Our interests are therefore aligned, and there is an incentive to drive success, to drive profitability,” says Richard.

An example of one of The Hartford’s Group Captives and one of its most unique programs is EPIC, Elite Partners Insurance Captive. What distinguishes EPIC is that it has open distribution, whereby any agent can work with the program administrator, IRM, to access the facility.

EPIC is a heterogeneous captive, open to a variety of classes with certain eligibility guidelines. Examples of eligible classes for EPIC include: Retail Chains, Distributors, Grocery Stores, Food & Dairy Processors, Bottlers and Beverage Distributors, Light Manufacturing (with low hazard products exposure), Restaurant & Fast Food Chains, Warehouse & Storage, Printing, Graphics or Publishing, High-Tech, Biotech, and Telecommunications. EPIC targets larger accounts with a risk size between $250,000 and $2 million in premium.

“In sharing the risk, safety becomes paramount,” says Richard. There is an emphasis on promoting risk management and putting loss control in place among the EPIC group members. This results in lower claims costs and helps to drive down premiums for the group and for any of the entities individually.

“Furthermore, there is expertise among the group that goes beyond any particular class. The group meets multiple times a year to discuss safety, to promote best practices, and to learn from one another.”

Richard explains that although there are many homogeneous captives out there, some members don’t want to be a part of a group to which their competitors also belong, they don’t want to be in a captive with the same risks. “An advantage of a heterogeneous captive is that you spread the risk more. If there is a legal issue in a specific industry, the negative impact among a group with different classes is diluted. Any industry-specific trend is diluted.”

Another program offered by The Hartford is Craft Brewery. The Hartford has partnered with Peter Whalen of Whalen Insurance, an acknowledged expert in the craft brewing industry, to administer an all-lines solution to this sector. The Craft Brewery program includes breweries/production facilities and brewpubs that brew their own beer and may also have a restaurant. The program includes liquor receipts up to 50% of overall receipts, and Specialty coverages such as Spoilage from Equipment, Off Premises Utility Interruption, Food Contamination, and Product Recall.

“The Craft Brewery program is a good illustration of working to find experts [Peter Whalen] in a particular field with a proven track record,” says Richard.

The Hartford recently launched a brand new program for Septic Contracting and Pumping. This is one of six open-access programs available directly to Hartford-appointed agents only, both retail and wholesalers, and another example of the different models the carrier supports. Unlike EPIC or Craft Brewery, there is no administrator. It operates directly from the appointed agent/wholesaler to The Hartford. The program includes all things septic, including installation/service, system pumping services, inspection and portable toilet rental and cleaning companies. The other open-access programs include Alarm Contractors, Arborists, Pool & Spa, Self-Storage and Truck Manufacturers.

When discussing with Richard the company’s marketing strategies, some key elements are in place. “We attend numerous conferences throughout the year, and we are very active visiting our program administrators. What’s more, we try to keep our Hartford field sales force aware of our presence and appetite so that they can be on the lookout for opportunities as well. We try to leverage The Hartford ‘feet on the street’ already out there.”

Along with Richard, there are three others on staff who are dedicated to developing programs. “One of our goals is to expand our surplus lines capabilities and to write more non-admitted programs. We currently have a program for Healthcare Facilities in which two of the lines (GL and Professional Liability) are written on a non-admitted basis. The program, available in 32 states, is designed for long-term care nursing homes, assisted living, and independent living facilities, and offers a blended solution of admitted and non-admitted coverage.

To find out more about The Hartford’s Captive and Specialty Programs, please visit the company Storefront. You can also contact Richard via email at: or call him at: (860) 547-4470.