As senior director/VP of hospitality practice at Arthur J. Gallagher Risk Management Services, Jackie Collins helps hoteliers find solutions that reduce the costs associated with risk—through traditional insurance plans or alternative options.
The hospitality division at Gallagher works with more than 8,000 companies related to the sector, from ownership groups (including real estate investment trusts) to third-party management companies, developers and contractors. Collins has been working with hotels for 17 years, and leading the team for nearly seven years.
Collins started out studying radiology and applied sciences at Hinds Community College and Baptist Hospital in Raymond, Miss. “It takes a special person to work in the medical industry,” she said. “For various reasons, I decided I was not that person. I ended up switching gears and changed my major to business. At one point, the dean’s office recommended that I interview with a local insurance agency.”
She got the job as an assistant account manager with Ross & Yerger Insurance in Jackson, Miss., in 1990 and spent the decade working her way up through the ranks, first an account manager at the Bottrell Agency (now Fisher Brown Bottrell Insurance) and Chandler Sampson Insurance Agency before ending the 1990s as a producer at Bottrell. “I wanted to be part of an organization that offered the resources larger clients needed in order to grow and protect their businesses,” she recalled. In 2003, she was recruited by Gallagher to be an area VP, and has stayed with the company since, achieving her current position after more than 10 years with the firm.
Gallagher was a good match for Collins’ interest in industry practice groups, especially as she began working with the hospitality sector. “In previous years, I had spent much of my time working with the construction industry,” she recalled. “I was looking for somewhat of a change, but I still wanted to use my experience in a new area. Hospitality was the perfect fit as we work with clients from the design stage to operations.”
Evolving Risk Management
After spending years moving from company to company, Collins says Gallagher’s culture is what has kept her there for the better part of two decades. “Gallagher provides full support in allowing us to manage our accounts,” she said. “While a number of brokers pass a new account off to an account team, Gallagher’s model is different. Gallagher allows me to manage all of my accounts, which allows us to treat each account like a new account every single year.”
Collins’ team at Gallagher uses the company’s Core360 model to evaluate a client’s risk management—and to then try and reduce the overall cost of that risk. A client’s total cost of risk is affected by the premiums paid, retentions absorbed, coverages provided and exposures presented, she explained. “Many hospitality carriers are restricting the coverage they offer even as they seek rate increases.”
All reviews begin with studying premiums that are being paid and whether or not the team can restructure a program to reduce those premiums as well as reduce any coverage gaps. “Along with reviewing coverage gaps, we review uninsured and uninsurable exposures in an effort to educate the client as well as reduce these self-insured exposures.”
Once the client has a plan in place, Collins’ team focuses on loss control and claims handling. “A robust loss-prevention program will help reduce third-party claim payouts,” she said. “This makes a client more attractive to the carriers and premiums are kept at a minimum.” The team also works with its clients from a contractual liability standpoint. “We help them understand what risks they are absorbing through contract language as well as what risk they can transfer to others.”
To minimize the impact of coverage reductions, Collins stressed the importance of identifying and communicating which coverages are the most important to the client’s business. “The client may be willing to accept some changes but not others, and this information is helpful when negotiating with carriers,” she said. “Review the client’s loss history and document any mitigation measures that have been put in place to address those losses, such as water improvement and mold management plans, or any steps that have been taken to deter sex trafficking activities.”
Clicking with Clients
“We make it a point to have periodic meetings with our clients throughout the year in an effort to approach situations in a proactive manner. We provide market updates to our clients in order to keep them updated on current market trends. We also invite clients to participate in various webinars hosted by Gallagher and/or outside industry experts that address coverage, loss control and other pertinent industry trends. With all of that being said, I have a great relationship with my clients and they know that I work hotelier hours (24/7/365).”
Logic in Logistics
“It is very important to be organized and have a great support team. While I am ultimately responsible for the success of each client’s program, there is a very strong support team that works in conjunction with me. Each member of the team takes ownership of their role in making the program a success. Not only does this include the day-to-day service team, but it also includes claims management and loss control. Our team meets on a regular basis to be sure our clients’ needs are being met.”
10 Steps to Reduce Premiums
Collins recommends 10 steps hoteliers can take to reduce premiums as well as broaden coverage:
- Start the marketing process early.
- Scrub loss data to be sure that claims have either been closed or have the correct reserve amounts.
- Review building and contents values to be sure they factor in accurate replacement costs.
- Update the property’s construction details to ensure that they reflect the age of the roof and any updates that have been made, including to the electrical, heating, ventilation, air conditioning and plumbing systems.
- Complete business income worksheets to confirm the appropriate business interruption values.
- Quote higher deductible options.
- Review revenue/sales figures for liability coverage. Premiums are calculated based on room revenue, food/beverage revenue and alcohol revenue. It is important that this information be accurate.
- Review payroll numbers in order to obtain accurate workers' compensation quotes.
- Evaluate the calculation of the client’s experience modification factor. This is an area where errors are often found that can be corrected to reduce premium costs.
- Double check employee classifications. New rules have been introduced to address employees who are furloughed and still receiving a paycheck.