Carpe Opportunitas! - Seize the (Professional Development) Opportunity
A WORLD OF OPPORTUNITY IS EMERGING. SEIZE IT. · A WORLD OF OPPORTUNITY IS EMERGING. SEIZE IT. 2017...
Transcript of A WORLD OF OPPORTUNITY IS EMERGING. SEIZE IT. · A WORLD OF OPPORTUNITY IS EMERGING. SEIZE IT. 2017...
Business Insurance
Employee Benefits
Auto
Home
Prepare. Protect. Prevail. With The Hartford.®
A WORLD OF OPPORTUNITY IS EMERGING.SEIZE IT.
2017 MIDSIZE BUSINESS MONITOR
More mid- to large-size U.S. businesses are pursuing multinational activities, from simple business trips to manufacturing. The Hartford’s second quarter 2017 pulse survey sheds light on their perception of the risks and how you can help them prepare for the unknown – wherever they’re conducting business.
2 | © September 2017 The Hartford. No part of this document may be reproduced, published or posted without the permission of The Hartford.
2 | KEY THEMES
3 | EXPOSURES EXPLORED
5 | COVERAGE BELIEFS
8 | UNCOVERING EXPOSURES
10 | KNOW WHAT'S IMPORTANT
11 | METHODOLOGY
13 | CONCLUSION
14 | ABOUT THE HARTFORD
TABLE OF CONTENTS80% of mid- to large-size companies have some degree of multinational exposure. The most common types of international exposure are selling products and services outside the U.S. (90%) and employees traveling outside the U.S. for business (86%).
86% of leaders of mid- to large-size businesses believe that they have specific international coverage. Most commonly, they refer to an endorsement on their U.S.-based general liability policy. Fifty percent of those who do not have coverage expect that their current U.S.-based policy will cover them internationally.
Cybersecurity/data breach are the key concerns related to their international operations.
Key themes
“The Hartford’s Midsize Business Monitor offers meaningful insights about key coverage concerns and fears regarding international exposures – and what’s important to business leaders when looking for a carrier for multinational coverage. Ninety percent of mid- to large-size businesses feel relatively knowledgeable about their international risks and exposures. Those who feel most knowledgeable are also most likely to be very concerned that their company does not have adequate coverage.
It continues to be important to educate clients about the potential multinational exposures their company faces, and how to properly protect against it.”
Mo Tooker Executive Vice President Middle Market
3 | © September 2017 The Hartford. No part of this document may be reproduced, published or posted without the permission of The Hartford.
WHO HAS EXPOSURES?
80% of mid- to large-size companies have multinational exposures. Of that segment, here are the reasons why:
WHAT ARE THEIR EXPECTATIONS?
Of companies that currently have international exposures:
Exposures explored
Have leased or owned premises outside
the U.S.
Have equipment located in third-party facilities
outside the U.S.
Have employees who travel outside the U.S.
for business
Have employees permanently assigned
outside the U.S.
50%
Sell products or services outside the U.S. (including internet sales)
90% 86%
76% expect an increase in
international operations
22% expect no change
1% expect a decrease in
international operations
69%
70%
4 | © September 2017 The Hartford. No part of this document may be reproduced, published or posted without the permission of The Hartford.
Here’s what our survey revealed on the concentration of exposure in different parts of the world.
Central America/ Caribbean: 26%
Canada/Mexico: 85%
South America: 29%
Europe: 60%
Central Asia: 19%
Australia: 16%Africa: 5%
Southeast Asia: 30%
WHERE ARE THE EXPOSURES?
5 | © September 2017 The Hartford. No part of this document may be reproduced, published or posted without the permission of The Hartford.
PERCEPTION: WHAT COMPANIES WITH INTERNATIONAL EXPOSURES BELIEVE
REALITY: WHAT KIND OF INTERNATIONAL COVERAGE BUSINESSES ACTUALLY HAVE
65% endorsements on U.S.-based general liability policy (most common, which often has significant gaps in coverage, leaving them underinsured or in some cases uninsured)
Coverage beliefs
COVERAGE FACTOIDS
Larger companies (>$100M) are more likely to have a foreign/global package policy than smaller ones (69% vs 45% )
Companies with local policies are more likely to have a local general liability policy
Roughly HALF of those who don’t have specific international coverage expect their current U.S.-based policies to provide it
90% of leaders surveyed feel relatively knowledgeable about their international risks and exposures
• However, these “knowledgeable” leaders are most likely to be very concerned that their company does not have adequate coverage
79% turn to their U.S.-based agent for information about international coverage
VS.
14% believe they don’t
86% believe that they have specific international insurance coverage
56% foreign/global package policy that specifically provides international coverage
25% local policies in countries where they do business
6 | © September 2017 The Hartford. No part of this document may be reproduced, published or posted without the permission of The Hartford.
KEY REASONS FOR NOT HAVING SPECIFIC INTERNATIONAL COVERAGE
“Our current U.S.-based policy should provide
coverage.”
“Our international operations are too new
– just starting up.”
“We don’t feel we have significant/enough exposure to warrant separate coverage.”
“Our insurance company(ies) haven’t discussed it with us.”
“Our agent(s) haven’t discussed it with us.”
“We don’t know where to go to obtain
coverage.”
“We don’t know enough about it … don’t know
when we need it.”
48% 31%
14%
24%
3%
17%
3%
“Our research suggests that most mid- to large-size companies are uninsured, underinsured or improperly insured when it comes to international exposures. That means there is an unmet need in the insurance market and a corresponding opportunity to meet that need. To do this, an insurer would need to listen to their clients, understand their needs and respond accordingly. The Hartford is listening to its clients and agent/broker partners. We know that you want us to provide multinational insurance solutions that meet the same level of quality and service that you enjoy from The Hartford in the U.S.”
— Alfred Bergbauer, Head of Multinational Insurance, The Hartford
7 | © September 2017 The Hartford. No part of this document may be reproduced, published or posted without the permission of The Hartford.
Of the business owners we recently surveyed, most had serious concerns about their multinational exposures.
“We are seeing some alarming trends in both the threat landscape and the regulatory environment that should encourage mid- to large-size businesses to closely review their cyber risk exposure and make sure their insurance program includes appropriate cyber risk coverages. Cyber regulations are still developing and vary greatly from country to country – having a trusted insurance provider for this coverage is increasingly important.”
— Tom Kang, Enterprise Cyber Risk Lead, The Hartford
KEY CONCERNS:Cybersecurity
Product liability
Employee security and safety
Terrorism
Data breaches
Complying with international rules
Product loss/damage
Political instability
worried that they don’t have adequate coverage for their international operations
68%
Cyber risk/data breach
Business travel accidents
Product liability
Stolen/damaged property abroad
Injury/property damage caused
by employees’ negligence while
abroad
Emergency medical or political evacuation
Emerging risks that may impact my
industry
Employer liability for employees who are
foreign nationals
Cargo in transit
Workers’ compensation for
employees abroad
Business auto for damage to vehicles
used abroad
Kidnap and ransom incidents
83%
77%
75%
74%
72%
71%
71%
70%
67%
67%
64%
57%
WHAT KEEPS BUSINESS OWNERS UP AT NIGHT?
8 | © September 2017 The Hartford. No part of this document may be reproduced, published or posted without the permission of The Hartford.
COMMUNICATION GAPS
17%The insurance
carrier
14%The insurance
agent
28%Both an agent and a carrier
41%No one
Uncovering exposures
WHO INFORMS BUSINESS OWNERS ABOUT INTERNATIONAL COVERAGE?
>40% of leaders in mid- to large-size businesses have never been asked by their agent or carrier about their international
coverage needs
59% of those without specific international coverage have communicated
to an insurance agent or carrier about coverage for their international operations
Professional liability:
“Are employees covered overseas?”
When to get international coverage:
“Once I have inter-national branches?”
“Only when we manufacture outside the U.S.?”
Tailoring policies to specific regions (i.e., local laws)
Impact of political scenarios:
“How do U.S. sanctions impact my ability to do business in certain countries?”
Product liability
WHEN DISCUSSED, SUBJECTS INCLUDE:
9 | © September 2017 The Hartford. No part of this document may be reproduced, published or posted without the permission of The Hartford.
ASK THE RIGHT QUESTIONS
Do you:
“Many mid- to large-size businesses may not fully understand the wide array of complex risks that their international exposures generate – topics like taxation, local regulatory restrictions and coverage requirements, and claims handling implications. When asking the right questions, multinational exposures are easy to uncover – many people just don’t know where to start. We’ve created tools to make it easier for agents and brokers to have those conversations with their clients, to uncover the need, and have great solutions to help protect them.”
— Kevin Strong, Head of Strategy and Global Network Operations,
Send or have employees overseas?
Sell products overseas?
Have goods warehoused overseas?
Have equipment overseas?
Have international locations?
Have foreign suppliers or customers?
10 | © September 2017 The Hartford. No part of this document may be reproduced, published or posted without the permission of The Hartford.
KEY: Very important Somewhat important Neutral Not that important Not at all important
Expertise in global coverage
63%
Same carrier as we use for our other (domestic) coverages
Understanding of local laws in each country Broad coverage
Ability to tailor coverage to my company’s specific needs
Knowledge about my industry and its specific risks
Recommendation from my agent
Limits/ability to offer separate limits from the U.S. policy
Company name and reputation
Ability to offer coverage across many different countries/regions
Allows me to work with U.S.-based staff (claims; service)
Claims service
Allows me to work with local staff in each country (claims; service)
Know what's important
70%
61%
28%
31%
63%24%
57%
6 %
55%
53%
47%
62%
6 %
28%
8 %
3 %
7 %
48%
62%
13%
31%
7 %
32%
41%
43%
Business leaders value a carrier who under-stands their industry and needs as well as local laws.
28%
36%
5 %
More than half say the ability to work with U.S.-based staff is very important in selecting a multinational carrier.
Most look for a carrier with broad coverage across a wide variety of geographic areas, but need coverage tailored to their specific needs.
33% 12%
37%
36% 13%
35% 17%
36%
8 %
15%
11 | © September 2017 The Hartford. No part of this document may be reproduced, published or posted without the permission of The Hartford.
OUR SUBJECT
Current trends among mid- to large-size businesses regarding their exposure to international exposure/risks.
OUR QUESTIONS:
• What are business owners’ concerns and fears regarding international exposure?
• What’s important to them when looking for a carrier?
OUR RESEARCH TARGET
• Leaders of mid- to large-size businesses with international exposure
» C-Suite or senior management with insurance decision-making authority
• Public or private companies
• Revenue between $10M – $1B
• At least 251 full-time employees
HOW WE CONDUCTED OUR SURVEY
• Online quantitative survey using panel recruited nationally
» Data were collected from May 16, 2017 through June 15, 2017
» A total of 204 interviews were completed
» Average survey length was 10 minutes
Methodology
28% Under 35
36% Other C-Level:
CFO, COO, CTO, etc.
22% Chairperson/
CEO/President
16% Executive VP/
Senior VP/ Executive Director
15% VP/
General Manager/ Managing Director
12% Owner/ Partner
72% Sole Decision
Maker
62% Male
38% Female
43% 35 – 49
27% Shared
Decision Making
25% 50+
2% Decision
Influencer
Gender:
Title:
Decision Making Role:
BUSINESS LEADER DEMOGRAPHICS
Age:
12 | © September 2017 The Hartford. No part of this document may be reproduced, published or posted without the permission of The Hartford.
FIRMOGRAPHICS
$10M–$50M
$50M–$100M
$100M–$500M
$500M–$1B
General Liability
Property
Workers' Compensation
Professional Liability
Product Liability
Umbrella
Commercial Auto
Employment Practices
Liability
Cyber Liability/Data Breach
Directors and Officers
Liability
Fiduciary Liability
Crime
Pollution and Environment
Liability
Kidnap and Ransom
Inland Marine
Ocean Marine
Cargo/Warehouse 75%Commercial Hull P&I 70%Marine Liability 85%
Manufacturing
Professional Services
Retail
Computer Technology/IT
Finance/Insurance
Healthcare
Consulting
28% 100%
58%
53%
22%
22%
25% 100%
58%
49%
13%
13%
23% 90%
58%
31%
10%
11%
25% 62%
57%
29%
10%
10%
9%
6%
5%
Annual Review: Type of Business Insurance:
Key Industries Represented:
Number of Agents/Brokers You Work With:
46% One Agent
12% Three or More
Agents
42% Two Agents
Number of Carriers You Work With:
U.S./International Agents You Work With:
6% Four+ Carriers
46% U.S.-Only Agents
1% International-Only Agents
54% Both
13% Three Carriers
37% One Carrier
45% Two Carriers
13 | © September 2017 The Hartford. No part of this document may be reproduced, published or posted without the permission of The Hartford.
For U.S. companies that do business in more than one country, every border introduces a whole new set of challenges. Laws, customs and language barriers can turn an insurance need or claim into a maze. As mid- to large-size businesses expand their offerings to customers and employees, integrate new technologies into their operations, pursue new market opportunities or engage in activities outside the U.S., owners and executives need to consider how each of these actions can impact their organization’s risk profile and risk management needs.
TAKING ACTION
Given the potential impact of these risks, it’s critical for mid- to large-size businesses to:• Actively review their insurance program based on their current and anticipated
scope of operations, including international activities• Design a multinational insurance program that meets the risk financing strategy
of the corporation • Stress test the program with loss scenarios to truly understand how the program
will perform in the event of a loss
Conclusion
17-0937 © September 2017 The Hartford
To learn more about these and other risk management topics, visit: thehartford.com/global.
The Hartford® is The Hartford Financial Services Group, Inc. and its subsidiaries. All property and casualty policies are underwritten by Hartford Fire Insurance Company, Inc., and its property and casualty affiliates, Hartford, CT. Employee Benefits are underwritten by Hartford Life Insurance Company and Hartford Life and Accident Insurance Company, Hartford, CT.
With more than 200 years of expertise, The Hartford (NYSE:HIG) is a leader in property and casualty insurance, group benefits and mutual funds. The company is widely recognized for its service excellence, sustainability practices, trust and integrity. More information on the company and its financial performance is available at thehartford.com.
Join us on Facebook at facebook.com/thehartford.
Follow us on Twitter at twitter.com/thehartford.
Follow us on Instagram at instagram.com/thehartford.
ABOUT THE HARTFORD
Business Insurance
Employee Benefits
Auto
Home