|
An EIC should be familiar with creative risk
transfer solutions which may include captives, trusts, bonds, insurance and reinsurance, and various financial transactions which are tax
advantageous. An EIC
should have formed
significant relationships with specific consultants, attorneys and accountants to outsource certain necessary skills and have the ability to manage
the process. For example, specialized skills
may involve negotiations with regulators, funding mechanisms and developing remedial cost
figures. An EIC should understand capacity
available in the domestic insurance market,
have access to foreign markets if necessary,
and understand how insurance captives are
often
utilized. As environmental insurance is
recognized as an advantageous solution to
many environmental problems and potential
exposures, the demand and insurance premiums will significantly increase.
Confidentiality Agreements are commonly executed for the Client’s insurance
submissions. An EIC should know the environmental insurance market submission which will include technical data. The EIC will often need to discuss the environmental data, environmental regulatory climate, assessment of liability, financial statements and claims data, among other things, with the underwriter. A close relationship
between an EIC and an underwriter will typically result in better results for the EIC’s Client. This is because significant negotiations will take place over the actual policy wording, pricing, financial transactions, submission materials necessary to bind
coverage, timing, allowable terms, and input on claim payments and resolutions.
In order to comprehensively bind coverage, the environmental policies must address all coverage elements. An EIC should coordinate with the Client, risk managers,
attorneys and/or accountants to assure that the Client’s needs have been met. An
experienced EIC would have worked on negotiating endorsements, and know the
acceptable risks, limits, deductibles, pricing, and manuscripted language, which
will provide maximum protection for the Client. Most general brokers will be unable
to dedicate resources to the job of controlling this process and facilitating the prompt delivery of an insurance policy. |
 |
An EIC should be accessible to the Client and the Client’s other professional
representatives at all times. In addition, an EIC should be able to clearly explain the
financial benefits of the risk transfer approach to the Client’s management team which often includes inside and outside counsel, accountants, and financial officers. An
EIC should have a few knowledgeable professionals who can provide continuous
personalized assistance. Large brokers are often unable to efficiently call upon the necessary resources from their large staff each with a specific specialty in order to quickly deliver an effective product, particularly for smaller placements. Large brokers typically have too many diverse interests present with respect to internal revenue
incentives for production.
An EIC must monitor changes to environmental exposures and alert the Client
if modifications to the financial transaction or policy are needed. Changing
environmental statutes, tax laws or legal developments are a few examples of
areas which an EIC should closely monitor to ensure that the Client’s risk
exposures remain protected. An EIC, which has been involved with prior
environmental claims, will be most sensitive to the ongoing protection of the
insured, and will be able to provide advice on the proper presentation and
handling of claims.
For more information, please send an email to TAdams@AlperServices.com
|
