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Whatever floats your boat
The pros at Western Marine help retailers build profits in recreational marine
By Elisabeth Boone, CPCU
“There is nothing—absolutely nothing—half so much worth doing as simply messing about in boats.”
So said Ratty to Mole in The Wind in the Willows, the beloved childhood classic by British author Kenneth Grahame.
To anyone who owns a personal pleasure craft, from a modest fishing boat with a small outboard motor to a sleek luxury yacht, there truly is nothing more worth doing than messing about in boats. Most recreational sailors are just as happy scraping the keel and polishing the brightwork as they are actually steering their craft across a placid lake or the open ocean, and many boaters enjoy competing for fun as well as honors.
Recreational boating is big business, and it’s also risky business. Most retail agents feel comfortable writing a personal watercraft policy for a homeowners client who owns a small boat—but when it comes to more expensive and sophisticated pleasure craft, retailers can benefit from the guidance of experts in the specialty marketplace. This specialized expertise also is valuable for retailers who need markets for related risks like boat and yacht dealers, marinas, boat manufacturers, and repair facilities.
A leader in arranging coverage for recreational watercraft and ancillary businesses is Western Marine Insurance Services Corp which operates as a program manager and underwriting manager and also has wholesale and retail divisions.
Western Marine was established in 1981 by Joseph Cecchini and R.J. Lorenzi. Based in Stockton, California, the firm originally operated only in the western United States. Today, with 49 employees and offices in La Jolla and Merced, California, and Frankfort, Kentucky, Western Marine does business in all 50 states and is deeply involved in the recreational marine community.
The firm’s AquaPac Millennium policy provides property (hull), liability (protection & indemnity), and medical payments coverage for the owners of virtually every kind of personal recreational watercraft: airboats, bass boats, cruisers, houseboats, pontoons, runabouts, sailboats, ski boats, sport fishing boats, trawlers, and yachts. Western Marine also offers a program for jet skis and personal watercraft as well as mechanical breakdown coverage for boats and yachts.
Western Marine writes commercial marine insurance packages including property, liability, and commercial auto coverages for boat and yacht brokers and dealers; marinas, including rentals, fuel docks, campgrounds, motels, and accessory stores; small to mid-sized custom boat and ship builders; marine engine builders; and boat repair facilities. The firm also manages an insurance program for yacht clubs.
Western Marine operates two wholesale divisions, which account for 75% of its business: Western Maritime Insurance Services, based in Stockton, and Maritime Central in Kentucky, which was established in 2006 as part of an initiative to expand Western Marine’s operations beyond the western states. The wholesale divisions place business for some 1,500 independent retail agents and brokers and offer the same coverages as the retail unit.
Keys to success
Two keys to success for intermediaries in any specialty market are underwriting expertise and the skills to build and maintain relationships with both carriers and retail agents and brokers.
Sheila Eskue helped establish Maritime Central in Kentucky and is vice president in charge of that office. Eskue’s insurance career spans more than 35 years and includes both retail and wholesale experience in production, underwriting, claims adjusting, and program management.
Working closely with retail producers at Western Maritime Insurance Services is Stephanie Solano, a 25-year veteran of the insurance business whose background encompasses experience with a specialty carrier as well as both general lines and surplus lines facilities. She joined Western Maritime in 2006 as commercial marine operations manager and is based at the company’s headquarters in Stockton, California.
“My responsibilities are to maximize the firm’s opportunities within the recreational marine industry, to improve agent and broker relationships, and to ensure uniformity in processes and procedures in the wholesale division,” Solano explains.
Among commercial recreational marine risks, Eskue says, marina operators in particular face a host of property exposures because their docks are susceptible to damage caused by weather.
“Hurricanes, ice and snow collapse, earthquakes, tornadoes, floods, and wave wash are all events that can seriously damage or destroy a dock,” she explains. “We work with a variety of carriers, and they address this exposure in different ways depending on the location of the risk.
“Some restrict their writings in certain geographic areas; others do provide coverage but underwrite each risk very carefully,” Eskue says. “In some cases a carrier will exclude certain coverages or require a higher deductible in order to write the risk.”
On the liability side, Eskue comments, recreational marine facilities face many of the same exposures as other industries, in large part because of the litigious nature of our society. To help manage these exposures, she says, her office arranges legal liability insurance and also offers umbrella coverage with limits of over $2 million.
For retailers who may not be familiar with liability insurance for marinas and related exposures, Eskue says, “Marine operators legal liability is equivalent to garagekeepers legal liability.”
As wholesale facilities, Western Maritime Insurance Services and Maritime Central match client risks with the appropriate insurer that writes recreational marine business.
“We have both exclusive and proprietary programs with admitted and nonadmitted markets,” Solano says, “and we work with many major A rated carriers that specialize in recreational marine coverage.”
Retail partners
As noted earlier, the wholesale divisions of Western Marine work with some 1,500 independent retail producers around the country to place recreational marine business. Of these producers, Solano says, “About 20% specialize in this market, another 20% have a strong focus in this area, and the remaining 60% are generalists.
“We love working with generalists, because we can help them learn about the recreational marine industry and educate them about exposures and show them how to develop business,” Solano says. “When they realize that we can guide them through the process, they become confident and enthusiastic about working in this market and start calling us to discuss their prospects. We can even provide leads.”
Adds Eskue: “We pride ourselves on the fact that we love to educate agents who aren’t familiar with recreational marine risks. We have resources that we can share with them to help them understand terminology, and we’re always happy to explain the various coverages needed by these risks.
“Playing this educational role benefits our retailers by giving them an edge over competitors, and it also helps us stay sharp because we have to be sure we’re providing current and accurate information,” Eskue says.
Now that Western Marine has begun to expand its footprint beyond the western states, Solano says, “We’re working to establish a national brand and set ourselves apart in the market. A key advantage for us is that we’re specialists; recreational marine business is all we do.
“As I pointed out earlier,” she continues, “we have proprietary and exclusive programs that we can tailor to the needs of the particular risk, and we enjoy the flexibility of having access to both admitted and nonadmitted paper. We work with highly rated national carriers that specialize in recreational marine business, and we can work with their underwriters to put together the best coverages for a given risk.”
As specialists, Solano adds, “We have our finger on the pulse of this industry and keep current with the rapidly changing trends.
For more information:
Western Marine Insurance Services
Web site: www.aquapac.com
www.maritimecentralins.com |
