By Dennis Pillsbury
Randall G. Goss is chairman and chief executive officer of the Dallas-based U.S. Risk Insurance Group.
Randall Goss, chairman and CEO of U.S. Risk Insurance Group, Dallas, Texas, states that "our greatest strength at U.S. Risk lies in our ability to innovate and develop new products for customers who have difficulty finding coverage. This is one way we solve the needs of our producers, particularly in this emerging hard market."
"We want to be the first company our producers think of when looking to place business in the E&S (excess and surplus) and specialty markets," adds Mac Wesson, president and chief operating officer (COO) of U. S. Risk. "And we can accomplish that by responding quickly every time they come to us with an opportunity. We must keep giving them reasons to come back."
U.S. Risk began operations January 1, 1986, "right in the middle of a hard market," Goss remembers. At that time, "we offered only three product lines--public officials liability, law enforcement liability and nonprofit D&O. For all three products, we acted as a managing general agent (MGA) on behalf of Lloyd's of London. We recognized that our greatest asset was the distribution network of agents offering our three products--we had a few hundred around the country--and began to develop new products for them to market." Products that followed included a program for Housing and Urban Development communities, a security guard program and "the first EPLI program to offer indemnity coverage as well as defense costs," Goss says.
U.S. Risk wants to be the first company that producers think of when placing business in the E&S and specialty markets, says Mac Wesson.
--Mac Wesson
But the company encountered several obstacles when it tried to expand its wholesale brokerage operation. "We went to companies and they told us to call back when we had volume," Goss says. "At about that time, an old line Texas agency--
R.L. Jarrett--became available and offered a solution to the problem."
We purchased the agency from London United Investments in 1990, and acquired about 20 different contracts with insurance companies, including primary energy, umbrellas, and so on." Jarrett had premium volume of about $12 million, as did U.S. Risk at the time. According to Goss, "these new contracts allowed our company to diversify and expand both product mix and the geographic distribution of business."
By the end of the decade, that
$24 million in volume had grown to reach $160 million in the year 2000. Premium growth over the last decade has averaged 20% to 25% every year. "So far, the volume in 2001 has exceeded the prior year by 50% and we anticipate premiums to be around $220 million for the full year," Goss notes. The majority of the business comes from independent agents. U.S. Risk has contracts with more than 5,000 agents nationwide. "Although we do work with the large brokerage houses, the vast majority (about 90%) of our business comes from independent agents," Goss says, adding that "one of the keys to the strong relationship we have with independent agents is that we, too, are independent. Not being owned by a large retail group allows us to form a unique relationship of trust with our producers."
The companies in the U.S. Risk Insurance Group employ approximately 220 people. The group has eight offices across the country. In addition to the Dallas headquarters, the company also has offices in Austin and Houston, Texas; Lafayette and New Orleans, Louisiana; Nashville, Tennessee; Hamilton, New Jersey; and Scottsdale, Arizona.
The companies in the U.S. Risk Insurance Group include the MGA--U.S. Risk Underwriters, Inc.; the wholesale E&S broker--U.S. Risk Brokers, Inc.; U.S. Risk Financial Services, Inc.; Professional Claims Managers, Inc.; and OmniSure Consulting Group, Inc.
In addition to continuing to serve as an MGA for various Lloyd's syndicates, U.S. Risk Underwriters also serves as an underwriting manager for a number of U.S.-based insurers. The company has eight major divisions: professional liability, energy, commercial underwriting, governmental programs, transportation, environmental, specialty and health care. "The newest division is our health care division, which was developed partly in response to one of the hardest markets--nursing homes," Goss points out. "We've put together a program for nursing homes that includes general and professional liability coverage on the home itself. We've written more than 1,000 homes in a difficult marketplace. By doing so, we provide a much-needed market for our retail agents and hopefully solve a critical problem for an industry that touches every citizen."
L.M. (Mac) Wesson, Jr., is president and chief operating officer of U.S. Risk.
He continues: "Our desire is to develop specialized programs for areas that are not saturated with competition. We want to provide markets for our agents in areas where they are having a hard time finding coverage from standard carriers." He points to some other programs, like international trucking, underground storage tanks and recreational liability, where "we essentially act like a carrier, performing all of the functions of a typical insurance company. We also developed an exclusive national program for the CGL GAP Policy." The policy provides coverage for certain exclusions in the standard CGL policy. Rounding out the U.S. Risk portfolio of exclusive programs is "the only coverage in the country for privately owned detention centers. It includes a broad range of coverages that are unique to that business, such as medical malpractice for infirmary personnel and civil rights coverage."
U.S. Risk Brokers, the wholesale brokerage operation, represents approximately 130 domestic and international insurance companies and offers virtually all forms of property/casualty insurance. "The combination of a seasoned, tenured group of brokers, along with innovative E&S and specialty carriers provides a valuable service to our agents," explains Goss.
U.S. Risk Financial Services, headquartered in Nashville, underwrites programs for the financial and mortgage banking industry. This group offers numerous programs unique to this industry, including bonds, professional liability and property/casualty coverages.
Professional Claims Managers began operations in 1986 to provide expert claims service in support of U.S. Risk underwriting programs. According to Goss, the litigious nature of most professional liability claims necessitates expert counsel that is intimately involved in every step of the negotiating process. The company has 15 employed lawyers, as well as a number of claims experts, and operates essentially as a third-party administrator.
OmniSure Consulting is a risk management company that provides services to health care facilities, primarily nursing homes providing long term care. Goss says the company "plans to expand to other fields eventually, focusing on the health care industry."
The fundamental cornerstones
Wesson says U.S. Risk's three fundamental cornerstones are its producers, its markets and its people.
The producers."We try very hard to associate with producers who reflect the kind of business practices that we value. We look to establish relationships with people who have a high degree of integrity and will provide us with quality business. When starting a new relationship with an agent," Wesson continues, "we look at each other to make certain there is compatibility. Ideally, we help each other and it grows from there."
The markets. "We're extremely proud of the markets that we represent. We view our relationship with them as a partnership," Wesson says, noting that "we are an underwriter and serve as the eyes and ears of the markets that we represent. We view our job as contributing to their success and try very hard to maintain an enduring relationship through good and bad times."
The people. "We have more than 200 people, all of whom are exceptionally good at what they do," Wesson says. "Our job is to create an environment where they can succeed and provide them with the tools they need to succeed. We're never at the end of that journey," he says, noting that the tools and the environment change and the company needs to also change to continue meeting the needs of its people. "I give a lot of credit to our profit center managers," he adds. "They have freedom and autonomy and have contributed greatly to our success."
Wesson continues that "finding people used to involve turning over every rock and recruiting people from other companies. I'm humbly proud that a lot of people now find us. They want to work for a growing company that respects its people." He adds, however, that "one of our strategic initiatives is to be creative in recruiting young people into the business. This business doesn't have the outward appeal for young people that say, the high tech or dot com industries do. However, we've found that when we get out and talk to people, we can make it exciting. And it's essential that we do. The average age in the industry is rising. We need to begin attracting talented young people into the business."
Goss concludes by relating the group's underlying corporate philosophies:
"We try to hire the very, very best people we can find. We don't look to fill a particular position but to recruit the best. Then we try and provide the environment to succeed and let them choose the direction their career will take. I view my job as a facilitator, as part of a team."
He continues,"We take integrity in our operations to a point where it's above and beyond the normal tenets of business. Our carriers will tell you they have an exceptional relationship with us partly because we believe in doing business the right way, even if it costs us money. Our first responsibility is to do the right thing. There have been situations where we have paid out money even though it was technically not owed under contract, because it was the right thing to do. We believe this kind of philosophy pays off over the long term, and try to instill that philosophy in every member of our staff.
"We strive for open communi-cations where no one feels ostracized. When anyone on our staff has a problem, it's our problem, not their problem" Goss concludes. "The long-term success of our company depends on our ability to meld together the needs of the individual and the company as one." *
For more information:
Web site: www.usrisk.com