title of meeting satts sales and technical training school ticket to adventure construction segment...

Title of MeetingSATTS

Sales and Technical Training School

Ticket to Adventure

Construction Segment OverviewMartin X. HorsmanAssistant Vice PresidentConstruction Segment

April 15, 2008

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Construction OverviewMartin X. HorsmanAssistant Vice PresidentConstruction Segment

Title of Meeting


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Topics

•Construction Segment Snapshot

•“Selling” Your Underwriter/What Your Underwriter Needs to Know

•Exclusionary Endorsements

•What Your Competition Might Not Address – Your Opportunities

•CNA Differentiation – Tailored Coverage Extensions

•CNA Differentiation – Risk Control

•CNA Differentiation – Claim

•Underwriting Appetite

•CAM Construction Programs

•Resources

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Construction Segment Snapshot

• $1 Billion Profitable Business Segment

•$200 million in new business in ’05 & ’06, $180 million in ’07.

•Long-term and continuing commitment to Construction

•Dedicated & designated underwriting, risk control and claims personnel at the point of sale

• Middle Market, Risk Management, Small Commercial and Other (e.g. Captive Business)

• Our 11 Focus Classes (CAM) Programs generate the majority of our business Street & Road / Concrete / Electrical / Land Improvement / General

Building / Roofers / Utility / HVAC-Plumbing / Landscaping / Pool & Spa / Building Equipment Installation & Repair

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“Selling” Your Underwriter/What Your Underwriter Needs to Know • Business Operations

CAM Supplemental applications• Scope of Exposures

Supplemental applications (auto personal use, Non-owned & Hired, UM/UIM)

• Named Insureds Complete explanations and amount of operations

• Loss History Five years, not including expiring

• Financial Statements Most recent year-end audited

• Contractual Risk Transfer Copy of standard contracts/subcontracts used

• Controls (Risk Control/Safety Program Culture, from the top down) Risk Control survey required prior to quote, incl job site visit

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Exclusionary GL Endorsements – Industry “norm”• Amendment of Insuring Agreement-Known or Continuing Injury or

Damage (Montrose)

• Asbestos

• Exterior Insulation Finish Systems (EIFS) / Exterior Finish Systems (EFS)

• Professional Services

• Residential (applicable to specific trades and/or states)

• Silica / Respirable Dust

• Subsidence

• Wrap-Up / Owner Controlled Insurance Programs (OCIP/CCIP)

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What Your Competition Might Not Address:Your Opportunities•Pollution and/or Professional Liability Exposures

Contractor’s checklist / Questionnaire / Claim Scenarios

• Involvement in Wrap-ups - (OCIP / CCIP)

• Joint Venture Involvement - Past, present and future

•Builders Risk CoverageIs the owner really providing the coverage? Is it adequate?

•Contractual Risk Transfer - Is it adequate?

•Risk Control/Safety Assistance – Account Service

•Continued Coverage when changing carriers – e.g., OCPs

•Non-Construction Exposures – properly identified and covered?

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CNA Differentiation – Tailored Coverage ExtensionsWe have tailored coverage enhancements beneficial for contractors:

• Contractors General Liability Extension Endorsement (GLEE) which provides great coverage extensions such as DIC/Excess-Wrap Up Coverage on Non-Residential Wrap-Ups; Insured’s interest in past Joint Ventures; Aggregate Limits per Project for on-going operations – and much more!

• Blanket Additional Insured Coverage for both ongoing and completed operations

• CAM specific program coverages such as Earthmovers Limited Pollution Liability, Roofing Replacement Expense Coverage, Electrical Disturbance Testing Coverage

• Contractors Equipment Deductible Waiver for LoJack® Brand Protection System and for equipment registered with the National Equipment Register

• Professional and Pollution Liability Coverage through CNA Pro/Schinnerer

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CNA launched the School of Risk Control Excellence (SORCE) as a mechanism

to reduce loss cost drivers and improve risk controls.

- 85 SORCE classes currently offered through the catalog- Over 30 4-Hour classes and 55 1-Hour classes - 25 classes focused directly on Construction exposures

2007 Results •371 classes completed with 216 co-branded with agents•362 existing CNA accounts have attended (6665 people trained)•1181 Prospect accounts have attended•Retention Rate for accounts that have participated in the SORCE classes

is 89%•$4.9 million in new business premium generated from prospects turned

clients and existing client who wrote additional new business

CNA Differentiation – Risk Control Capabilities

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•Construction Claim Expertise•Dedicated Construction Unit in Express Center to handle all Express

GLPD claims •Dedicated Utility Strike Claim Units in both the Northeast Service

Center and the Express Center in Reading•Designated Claim Representatives in the Service Centers and Claim

Consultants in the Major Case Units countrywide to manage all Construction-related claims.

•Construction claims at CNA (with the exception of the Express Units) handled by Adjusters who have obtained the C.R.I.S. Certification from IRMI.

•CNA Staff Counsel, Special Investigations Unit (SIU) and Subrogation personnel will be designated to support the Claim staff and to manage Construction claims where their expertise is required or will add value.

CNA Differentiation – Claim Service

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Construction CAM® Programs – U/W Appetite •American Road & Transportation Builders Association (ARTBA)

•American Society of Concrete Contractors (ASCC) •Electrical Contractors Class Program (ECCP) •Land Improvement Contractors of America (LICA) •Master Builder Advantage Program (MBAP) •National Roofing Contractors Association (NRCA) •National Utility Contractors Association (NUCA) •Sheet Metal, Mechanical, HVAC & Plumbing Contractors program

(SMAP) •The PLANT program for landscape & lawn care contractors (PLANT)•Spa and Swimming Pool Contractors program (SPLASH)•Building Equipment Installation & Repair program (BEAR)_________________________________________________________________________•Best in class contractors with the exception of those contractors primarily

involved in very hazardous work such as nuclear work and subway construction

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ARTBA Summary • Program is designed for highway, street & road contractors.

• Program is endorsed nationally by the American Road & Transportation

Builders Association

Key Underwriting Issues:

– Work zone safety, falls from elevated bridges and overpasses– Traffic control (flagging operations)– Misuse of cranes (setup, weight overload)– Contractual risk transfer practices– Silica exposure

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ASCC Summary

• Program is designed for contractors involved in concrete construction, repair and maintenance such as curbs, sidewalks, driveways, patio floors and non-residential foundations. Focus is on flat work, although tilt-up construction up to 50 feet is allowed.

• Concrete pumping operations (for others) not allowed

• Endorsed nationally by American Society of Concrete Contractors

Key Underwriting Issues: – WC: manual material handling, work zone safety, silica exposure– GL: work zone safety (traffic control), risk transfer, silica exposure,

underground utility damage, trench/excavation safety

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ECCP Summary

• Program is designed for electrical contractors working within commercial, industrial or institutional buildings.

• Program is endorsed nationally by the Independent Electrical Contractors association

Key Underwriting Issues:– Emerging Trends: low-voltage voice, data, and video (VDV) wiring

and installation – No electrical utility company or power line work– Falls from elevations– Electrocution

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LICA Summary

• Program is designed for land improvement/earth moving contractors. Typical operations involve land clearing, grading of land, site preparation work, excavation work, terracing of land, and irrigation and drainage system construction.

• Program is endorsed nationally by the Land Improvement

Contractors of America

Key Underwriting Issues:– Landfill exposures – Underground utility damage– Equipment theft and fires

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MBAP Summary• Program is designed for general contractors involved in

commercial, industrial or institutional projects.

• No formal partnerships with any trade associations; although CNA participates at AGC and CFMA events to support this program and stay abreast of GC issues and trends.

Key Underwriting Issues:– Contractual risk transfer practices– Job site security and protection– Selection of quality sub-contractors– Quality control/documentation program

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NRCA Summary• Program is designed for commercial, industrial and institutional

roofing contractors.

• Program is endorsed nationally by the National Roofing Contractors Association

Key Underwriting Issues:– May 1 renewal cycle (60% of the book)– Falls from elevations and through roof openings– Fires from torch work– Water damage during and post construction

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NUCA Summary

•Program is designed for underground water, sewer and natural gas main utility contractors.

• Program is endorsed nationally by the National Utility Contractors of America

Key Underwriting Issues:– Damage to existing underground utilities– Trench/excavation safety– Work zone safety

– Struck-by injuries (struck by vehicles, equipment, materials)

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PLANT Summary

•Program is designed for landscape contractors, lawn care companies and nurseries.

• Program is endorsed nationally by the Professional Landcare Network (PLANET)

Key Underwriting Issues:– Falls from heights (WC coverage no longer written on tree care risks)– Manual material handling; slip & falls from equipment– Equipment and tool theft – Auto: vehicles making multiple service calls, often under time pressure.

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SMAP Summary• Program is designed for sheet metal, mechanical, HVAC and

plumbing contractors.

• Program is endorsed nationally by the Mechanical Contractors Association of America

Key Underwriting Issues:– No testing or remediation work allowed for IAQ or mold – Quality control program (water damage) -- Falls from heights– High hazard process piping work– Auto: service vehicles making multiple service calls under time

pressure

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SPLASH Summary• Program is designed for spa and swimming pool contractors that

build or install in-ground, above ground, spas and hot tubs and swimming pool and spa cleaning and maintenance companies.

• Firms with manufacturing, wholesale and/or retail exposures are acceptable, as long as the risk also has significant construction/installation exposure.

• No formal partnerships with any trade associations

Key Underwriting Issues:– No construction or installation of indoor residential pools and spas.– No construction or installation of pools and spas on upper floors or

rooftops of buildings (either existing or new).– Diving related injuries - diving board and water slide exposure must

follow strict risk control guidelines.– Exposure to and/or contact with chemicals.

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BEAR Summary•Program is designed for a wide range of building equipment

installation, dismantling and repair contractors including those who do drilling in industries that we consider to be low to moderate risk such as water well drilling and soil core sampling.

• No formal partnerships with any trade associations

Key Underwriting Issues:– No crane rental or leasing (with or without operations). Incidental

operations will be allowed to certain percentage and evaluated based on strict risk control guidelines.

– Rigger's Liability– Formal, written safety programs must be documented and in

place for all potential insureds/– Theft of equipment and tools.– Falls from elevation and electrocution.

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Resources

•Local Branch: Front-line underwriting personnel with very high levels of authority

•Regional Construction AVPs– Martin Horsman – Bobby Hammond– Ed Harkins

•www.CNACentral.com -CAM Program Marketing Materials and Underwriting strategies -CAM Supplemental Applications

•Victor O. Schinnerer•www.osha.gov• Industry Publications: Engineering-News Record, Construction

Executive, Trade-specific publications such as ARTBA’s Transportation Builder and NUCA’s Utility Contractor, PLANET’s the PLANET News

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Q&A•Martin X. Horsman•[email protected]•(Work Phone) 860 513-6490

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DisclaimerThe purpose of this presentation is to provide information, rather than advice or opinion. It is accurate to the best of the speaker's/author’s knowledge as of the date of the presentation. Accordingly, this presentation should not be viewed as a substitute for the guidance and recommendations of a retained professional. In addition, CNA does not endorse any coverages, systems, processes or protocols addressed herein unless they are produced or created by CNA.

Any references to non-CNA Web sites are provided solely for convenience, and CNA disclaims anyresponsibility with respect to such Web sites.

To the extent this presentation contains any examples, please note that they are for illustrative purposes only and any similarity to actual individuals, entities, places or situations is unintentional and purely coincidental. In addition, any examples are not intended to establish any standards of care, to serve as legal advice appropriate for any particular factual situations, or to provide an acknowledgement that any given factual situation is covered under any CNA insurance policy. Please remember that only the relevant insurance policy can provide the actual terms, coverages, amounts, conditions and exclusions for an insured. All CNA products and services may not be available in all states and may be subject to change without notice.

CNA is a service mark registered with the United States Patent and Trademark Office. Copyright © 2008 CNA. All rights reserved.

title of meeting satts sales and technical training school ticket to adventure construction segment...

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