Zurich Program Managers share their approach to supporting Program Administrators

Striking the right balance between empowerment and support can be challenging. But it’s top of mind for three Zurich Program Business Managers who work closely with Zurich Program Managers on their respective teams and their respective Program Administrators. Overseeing various portfolios of business, they help identify and communicate strategies for growth and provide resources and support to achieve shared goals.

We spoke with Sharon Burns from her New Jersey home base, Patti Heffernan who works out of  Schaumburg and Todd Klostermann who operates out of Omaha.

      

Here they share their priorities and what they find most challenging and most rewarding (which often are the same thing).

Q: Can you share a little background on the relationship role that you hold within Programs?

Sharon: My day-to-day interaction is with my team that manages the actual delegated underwriting of programs business, which entails all aspects of the underwriting in terms of the quote issuance, risk selection and more. I also am involved in meetings with Program Administrators where we talk about strategies for growth. It’s done in a very strategic way. Conversations are happening on a regular cadence, where we focus on how we are collaborating to write profitable business. Together, we are working to solve problems and identify strategies for growth.

Patti: My role is ensuring we’re executing on our commitments. If we say we need to get rate, we make sure Program Administrators have gotten that message. I view our roles as being more focused on the relationship. So, if something good or bad happens, we usually get called. Our program managers handle the details, and we participate when needed. We are there to ensure everything is flowing well, including claims service and whether we are getting filings done.

Todd: We foster relationships and build upon them. With the PAs that Patti, Sharon, and I oversee, we look over their portfolios, meet with individual segment leaders within those organizations and have quarterly reviews of existing business. Right now, we have an exciting opportunity to expand with some of our existing Program Administrators. We talk about our value proposition and our expertise and identify ways to turn that into another opportunity where we know the PA has a book of business.

Q: What is your background and expertise that you bring to the role?

Sharon: I am an attorney and I have a claims background, I’m a former claims manager. Because of my work history I like to analyze things and that does help. And also, the relationship part, my work history helps there too.

Patti: I started in claims a million and one years ago but about 35 years ago got into underwriting. I came over from Commercial Insurance, where I was in the Construction group for 10 years, then prior to that different companies. That lends itself to being a portfolio manager.

Todd: I started in Auto, but in 2015 I was nudged out of my comfort zone when I was introduced to property. Not only property, CAT property. Which has been fun and interesting. We’ve been able to make a lot of strides with partners in the CAT space. Everyone in our programs space also has technical expertise but also the market relationship acumen is where I think we really excel.

Q: What specifically do you like when it comes to working with Programs versus other roles you have held?

Sharon: Every day is different. Because we have different programs, they bring different challenges and opportunities. And I enjoy interacting with our  partners and working together to solve problems. An example of one that’s interesting to work on is the tribal program. There are different challenges when the property at issue is subject to sovereign protections. That’s a more unique program. The program manager who underwrites it reports to my team.

Patti: An interesting one I work with is film production, where these are short-term policies. During the COVID pandemic, there was a production company doing a bunch of filming for universities as they went virtual, and there were interesting challenges in how they had to set that up to keep things moving for these schools. They had to get creative to set it up so everyone was 6 feet away from one another. I learned a lot about how we had to keep going in the world. In Programs, you have to know a little about a lot of things. 

Todd: The overall programs market has grown from something like $67B to $79B in premium from 2021 to 2022. There is clearly a lot of GWP out there. Being relationship leads here with specific program partners, we are always finding new opportunities and new programs that we can get our foot in the door on. The Programs space is evolving, PAs are not looking for single carriers to take on programs, they’re looking for shared and layered opportunities, quota share opportunities, with carriers taking several pieces of multiple books of business rather than taking the entire program.

How have you been challenged as a program business manager?

Sharon: Relationships take time. There are different challenges with different Program Administrators. So, working through that can be rewarding and that can be challenging. What’s very helpful is just to pick up the phone. What’s happened is many people have become very Teams and Zoom oriented. Sometimes you just need to pick up the phone or maybe not send the email and just have a conversation and say, “Let’s collaborate together to solve this.” That’s one of the things that I try to do. Because I find you can avoid some of that back and forth if you just change the way you’re communicating. Just pick up the phone.

Patti: As Zurich’s strategy evolves, we have to get ahead of the message. Zurich will advise underwriters to do or not do something. There’s a timeline that is challenging, and we try to push back if it doesn’t make sense. But it’s about communicating very clearly and documenting it. One of the things I find – I like to pick up the phone – but you also have to put it in writing, so everyone walks away with the same understanding.

Todd: Insurance is very cyclical. Some of the lines of business that we write and have appetite for can shift, depending on what’s going on in the world, such as social inflation and nuclear verdicts. Our appetite is strong one year for a certain line and the next year it may not be, and Zurich may want to focus in another area. Communicating the challenges of the insurance market can be a challenge itself.

When it comes to portfolio management are there certain characteristics that you focus on to manage the portfolio?

Sharon: We delegate underwriting authority to our Program Administrators. The assumption is they will be able to handle about 85% of submissions and only refer into Zurich our permission to write 5-15% of business. So, we really need a partner that has invested in staffing, people with subject matter expertise. We’re also looking for partners that are committed to developing and executing a strong marketing plan so that we can meet our top and bottom-line targets on both sides — they have their own and we have ours, so there has to be strong collaboration. We want a partner that has a good distribution network. This all ties into how we will meet our goals. We need a partner that has those characteristics.

Patti: The characteristics we focus on depends on the program. Always of course we have to watch profitability — rate, profitability, and growth. We always have to look ahead to see what deductibles are doing, do we want to increase or reduce. There is a lot involved with program management, but when you look at it generally, we have classifications of grow, sustain, or reduce. So based on where we want to take the program, that is where we want to focus.

Todd: That’s the No. 1 job description of a Program Business Manager, is portfolio management. We’re giving the pen to our Program Administrators. We’re not referral underwriters. We are looking at the portfolio and looking at how to improve the loss ratio, how to grow the top line, improve marketing efforts, review claims in a way that’s different. We use data and analytics to give us different insights. We may get our technical underwriting team involved in audit reviews. We do a number of portfolio management activities throughout the month that give us an overall view of what that book of business looks like. We don’t say, “Hey, Program Manager, we see this,” and dictate a change. We say, “Hey, Program Manager, we see this, we want to bring it to your attention. Let’s work together to solve a problem.” We’re trying to be proactive versus reactive and talk something out before it becomes a problem. We’re doing a lot of work on our portfolio management process.

What are the ways you work with your Program Administrators to find out what their marketing plans are and how they intend to grow the business.

Sharon: We have a relationship where we are in constant contact with Program Administrators. In the fourth quarter of the year, the conversations start with partners about the following year and what our budget is and how we are going to get there. We outline a plan by quarter, documented and mutually agreed upon. We articulate the goal for GWP and rate targets and market strategy with dates that we can meet, and all this rolls back up to our goals. It’s collaborative. It’s also a living document, because things happen; maybe we have a great first quarter and are on target to make even more premium. Maybe we come up with a great idea that requires us to modify the marketing strategy. The Program Managers meet with Program Administrators every day. But formal meetings – the ones I’m talking about – are monthly, to see how the month was, did we meet the plan, are we on track. There are constant conversations about, are we on track to meet the goals we have identified and if not, how do we get back on track.

Patti: There’s some variability depending on the resources of PAs. Some Program Administrators have a big organization behind them. Others do not. Maybe they are not clear on how to look to the future to set up growth. So, then we may do some of the classes that our Marketing team runs to help them develop their program.

Todd: Any time we have a new Program Administrator, we’re introducing them to our marketing team and walking through the plan, to see what it looks like, what are some gaps, what type of white papers do we have that might be helpful. What type of distribution platforms do they have, are they working strictly with retail agents, wholesale? ZProgramsMatch is a huge asset. We’ve done innovation sessions with some Program Administrators to talk through the entire process to help them redefine a value proposition, get into markets they’re not in today, identify different distribution channels that we can open or unlock for them. We have CE sessions that have been very well received. That’s another way we can show value for our program partners, is our expertise on the marketing side.

Is there something unique that Zurich Program Business Managers do that maybe others in the business don’t do?

Sharon: Building trust is something we focus on. You have to have that constant communication. There has to be constant communication, whether a daily phone call, Teams meetings, and some actual in-person time with your partner. If it’s a relationship you do need to have that in-person face time, going to lunch and getting to know each other, where we’re laughing together. Then if something happens, it makes it easier to work through it, because you like each other as a person.

Patti: I go at most things with humor. Coming from construction, I focus a lot on controls and risk selection. I like to look at how do we fix something versus how we get more rate for it. I engage risk engineering and claims – I really look outside our unit to get additional insight.

Todd: I like to let people feel empowered to manage the business in the ways that they see are most impactful for them. I like to work very collaboratively with all our different partners across the business. It’s funny; when we bring a Zurich team in to meet with a program administrator, and everyone from Zurich gives their background and bio, some have been here 32 years, 20 years. I’m at 16 years, and sometimes I have the least tenure of anyone in the room from Zurich. It’s a very tenured and experienced team.