PIWA Annual Convention focuses on multi-state issues

PIWA’s 2006 Annual Convention, held at the Manhattan Financial Center Marriott Nov. 1-2, featured a wide range of speakers who addressed changes that could impact the non-admitted market in New York and throughout the country.

PIWA Treasurer Lucas Snyder awards this year's Abe Snyder Memorial Scholarship to student Courtney Zhu.

Abe Snyder Memorial Scholarship
In keeping with recent tradition, the convention’s opening dinner was in memory of past president Abe Snyder, in whose name PIWA has established a memorial scholarship. The 2006 Abe Snyder Scholarship was presented at the dinner to Courtney Zhu, a freshman at St. John’s University majoring in actuarial science. Zhu’s scholarship was presented by PIWA Treasurer Lucas Snyder, who also serves as chair of the association’s scholarship committee.

Proposed federal insurance regulation
Appropriate for the week before election day, PIWA’s Opening Keynote Speaker was Gregory Wren, a state representative and attorney from Alabama who heads up the Coalition Opposed to a Federal Insurance Regulator, created to oppose S.2509, also known as the National Insurance Act of 2006.

Wren’s address focused on the lack of need for federal oversight of the insurance industry, quoting the bill’s sponsor, Sen. Sununu of New Hampshire, who said: “There is no insurance crisis that caused the introduction of this legislation.”

Gregory Wren, head of the Coalition Opposed to a Federal Insurance Regulator, gave the opening kenote speech.

He equated the office of a National Insurance Commissioner to the proverbial bottomless pit, noting that the office would be funded by fees, with no limit on its size. Federal insurance regulators would need to replace the efforts of some 13,500 Department of Insurance employees throughout the 50 states, with total budgets nearing $900 million countrywide.

Costs and questionable effectiveness and efficiency aside, Wren cited the market disruption as a serious concern should federal regulation be enacted. “To be a player, companies would need to be regulated at the federal level,” he explained. “Small, multi-state and regional companies would be squeezed down and unable to compete with large national companies.”

In the wake of Wren’s remarks, PIWA is developing a formal position on this measure. ELANY, PIA, NAIC and the National Coalition of State Legislators already have stated their opposition.

PIWA President Gary Hollederer moderates this year's panel discussion.

Multi-state risks
Recognizing that risks written by PIWA members continue to morph and expand, and that nearly all PIWA wholesalers write business in other states, PIWA’s first education program was a panel discussion on How to Place Multi-State Risks, moderated by PIWA President Gary Hollederer.

Experts from New York (ELANY Executive Director Dan Maher), New Jersey (NJ Surplus Lines Association President Steve Gross and the organization’s legal counsel, Michael Byrne of LeBeuf Lamb), and Pennsylvania (Pennsylvania Surplus Lines Stamping Office Executive Director Ken Rudert) discussed the laws and regulations for placing non-admitted business in each of the states.

The "How to Place Multi-State Risks" panel: New Jersey Surplus Lines Association President and legal counsel Steve Gross, Michael Byrne of LeBeuf Lamb, ELANY Executive Director Dan Maher and Pennsylvania Surplus Lines Stamping Office Executive Director Ken Rudert.

The panelists compared and contrasted the laws in each state, and provided specific examples of what each state requires when placing a nonadmitted policy.

Mock trial
The day's final education session was an E&O Mock Trial, entitled Don’t Court Disaster. Coordinated and moderated by ELANY Executive Director Dan Maher, the program featured a variety of lawyers who provided an entertaining—and eye-opening—look at the proceedings and ramifications of an E&O trial.

Thanks to Dan Maher, Milton Thurm, Dennis Kelleher, Kevin Reynolds, Julius Rousseau and Jonathan Kline for participating in the program.

Luncheon keynote speaker Kevin Brooks:
“Are professional underwriters rarer than honest politicians?”
PIWA’s luncheon keynote speaker, Kevin Brooks, President of Argonaut Specialty Insurance Services for the last two years and well-known to most PIWA members, provided his insights on the non-admitted market, developed throughout his nearly 30 years in the surplus lines business. Brooks was honored by PIWA in 1993 as the winner of its Service to the Industry award.

Kevin Brooks, president of Argonaut Specialty Insurance Services, offered the luncheon keynote speech.

Like any good politician (or company president), Brooks never actually answered the question that was the topic of his speech. However, he cited industry statistics and trends as the basis for his theory that the non-admitted market will continue to grow in size and profit. In 1972, said Brooks, the surplus lines market wrote only 2.2 percent of all commercial risks—a market share that had grown to 13 percent by 2005. Industry surplus in 1969 (the year Brooks entered the business) was $14 billion; by 2005, it had grown to $439 billion—a 300 percent increase.

According to Brooks, the non-admitted market share will continue to increase as more and more retailers turn to that market for risks that might once have been written in the admitted market.

Thanks, sponsors
Many thanks to the following companies, whose support made this convention and the Abe Snyder Memorial Scholarship Dinner possible: