ACI-NA Risk Management Conference Overview

Airport leaders from across the country came together to discuss emerging risks in today’s environment at the ACI-NA Risk Management Conference in New Orleans. Alliant had 14 brokers attending from both our P&C Specialty and Construction Divisions, along with six speakers - Justin Swarbrick, Tyler Smith, Regina Carter, Jim Cottone, Jim Holobaugh and Matt McManus – who delivered “Property Market Update” and “Surviving Construction at Your Airport."

Below are key takeaways from the conference:

1. Nuclear Verdicts/Social Inflation – The rising litigation costs and the impacts on the insurers – The 2015 'bus-shelter' case at a major airport kicked off inflated jury verdicts, a trend that will continue and end up driving premium increase. Airports should be asking: Do we take these cases to trial or do we settle? Could it be more cost beneficial to settle?
    
2. Hard Market? – We are not in a hard market because we have not seen true capacity issues, but we have seen an increase in pricing. If airports are exposed to natural catastrophes, it will be more difficult to procure higher limits and keep premiums down.
    
3. Property Valuations – This is going to be a major problem for airports that have not trended their property values and that have not done a recent appraisal. We are seeing 30-40% higher values on locations from two to three years ago. Airports will not be able to run from this issue and should start looking at an appraisal firm to do an appraisal every three to five.
    
4. Relationships – Meeting with your underwriters and maintaining a positive relationship with carriers is going to be huge when it comes to renewals. Yes, it will be beneficial to have a great relationship during the good/no loss years, but you NEED to maintain that relationship for when you have a bad/major loss year.
    
5. Submission – Having a good story to tell the underwriters and a good/clean submission will be key to getting your submission to the front of the line with favorable renewal pricing and terms/conditions.
    
6. OCIP (Gross or Net) – Everyone wants to know how much money was saved during an OCIP project. If contractors “bid gross” and then deduct their insurance costs, the airport will know exactly how much insurance will cost, if your contractor purchases it. If the contractors “bid net” it will be more difficult for the airport to calculate the amount of savings.
    
7. OCIP Monthly Meetings – The OCIP enrollment review is beneficial because it helps to ensure companies have not been overlocked from OCIP enrollment. Knowing which companies are no longer working on your jobsite is also helpful when reviewing loss reports.

This year’s Alliant hosted event was at STUMPY’S Hatchet House. We enjoyed throwing axes with roughly 40 attendees and I could say this year was a “bullseye.” We look forward to hosting future events at the ACI-NA Conference and enjoying everyone’s company.