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Transurance Ware Preston and Bruce Thomas

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Transurance Ware Preston and Bruce Thomas Marsh Telecom Executive Forum Atlanta, GA 10/12/06 What Executives Think About Insurance Pros Insurance is a ... – PowerPoint PPT presentation

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Title: Transurance Ware Preston and Bruce Thomas


1
Transurance Ware Preston and Bruce Thomas
Marsh Telecom Executive Forum Atlanta, GA
10/12/06
2
What Executives Think About Insurance
  • Pros
  • Insurance is a great financial tool.
  • Insurance recoveries are essential when you have
    had a large loss.
  • Insurance works best when other risk management
    initiatives dont.

3
What Executives Think About Insurance
  • Cons
  • Insurance recoveries are never enough.
  • Insurance policies are hard to understand.
  • Settling claims is slow and painful.
  • Many types of loss are difficult or impossible
    to prove.
  • The broader my coverage, the harder it is to get
    paid.

4
What Executives Think About Insurance
  • Wishes
  • Payments should be more certain, like other
    financial contracts.
  • I would like to buy more insurance but not if it
    involves more hassle or if I do not know what I
    am getting.
  • I would like to retain more risk, but Im
    concerned about all of the expenses that will not
    be reimbursed by insurance when I have a large
    loss.

5
Interpreting These Comments
  • Companies have significant damages that are
    collateral to covered loss events but that are
    not paid by their insurance.
  • These damages are difficult to define, prove, or
    measure.
  • They want more coverage to pay for these damages.
  • They want a means of insuring these damages that
  • Combines economic efficiency with payment
    certainty
  • Does not involve anymore hassle

6
Transurance
  • Transurance is a new form of agreed value
    insurance that supplements traditional insurance
    to pay for collateral damages that are not
    covered.
  • The payout is a pre-agreed percentage of the
    recovery from a traditional insurance policy so
    the loss does not need to be proved.
  • The proceeds can be used as the policyholder sees
    fit.
  • The cost is the same pre-agreed percentage of the
    referenced insurance premiums.
  • Transurance can be applied to any type of
    insurance.

7
Arch Property Transurance Program
  • Pays for Collateral Damages
  • Economic costs that are not covered by property
    insurance
  • Payout is a percentage of the insurance payment
  • Insured may choose payouts up to 20
  • Maximum limit is 20 million per occurrence and
    in the aggregate
  • Premium is generally the same percentage of the
    insurance premium
  • Pay 10 more to get 10 more
  • Minimum premium is 15 thousand
  • Proceeds may be used as policyholder sees fit
  • Collateral Damages do not need to be proved

8
Arch Property Transurance Program
  • Exclusions
  • Named windstorms, earth movement, flood, and
    other typical exclusions
  • Credits will be granted to the extent these
    perils are covered by insurance
  • If 50 of the insurance premium is for these
    perils then one should be able to buy 20
    Transurance for 10 more premium

9
What Are Collateral Damages?
  • Any expense or loss of revenue associated with an
    insured property loss that is not paid by
    property insurance
  • Deductibles and amounts in excess of limits
  • 15 to 20 of claimed amounts are not covered by
    insurance
  • Business continuity expenses that are
    traditionally uninsurable
  • Difficult to define, prove or measure
  • Discretionary in nature
  • Include advertising expenditures concessions to
    vendors, distributors, and employees legal and
    consulting expenses additional administrative
    and financing cost lost revenues cost of new
    risk management programs etc.

10
The Business Environment
External
Competitors
Community
Customers
Internal
PPE Employees Capital Other Property
Politicians
Suppliers
Regulators
J/V Partners
Debtholders Stockholders
11

100,000
Transurance
Insurance
50
12
Structuring Transurance
1,250MM
500K
750MM
1MM
250MM
1MM
50MM
3MM
13
Reasons to Buy Transurance
  • Collateral damages are significant
  • 15 to 40 of property insurance recoveries
  • Transurance covers them simply and
    cost-effectively
  • No hassle buying this coverage or settling claim
  • Cost is typically the same as property insurance
  • Everyone is sensitized to coverage gaps after a
    loss
  • Why be second-guessed?

14
Obtaining a Quote
  • Transurance Services, LLC is the Program
    Administrator
  • This is a surplus lines product
  • Submission requirements
  • Property insurance underwriting submission
  • Contact Information
  • TransuranceServices.com
  • Ware Preston 203-356-1583 WP_at_transuranceservices.c
    om
  • Bruce Thomas 203-445-0830 BT_at_transuranceservices.c
    om
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