Business leaders are always looking for guidance and support in addressing their challenges, and that need has become more acute during the pandemic. When long-term strategy has suddenly been replaced with week-to-week recalibrations, a trusted source of insight can be invaluable. Insurance companies have been carefully tracking data and trends and adjusting their pricing and coverage to reflect changing business and consumer behavior. In this way, insurers have a unique vantage point on what we’ve just been through and what lies ahead.
Chris Demetroulis, managing director of transportation at Gallagher, has more than 25 years of industry experience. I sat down with him to talk about the evolving risk landscape, the importance of data and analytics in scenario planning, and why customer engagement is all about problem solving.
The following Q&A has been condensed and edited for clarity.
Scott: What are the primary issues your customers are facing, and how have you helped them manage their evolving risks?
Chris: First and foremost, we quickly realized that each client has been impacted differently by the stay-at-home restrictions that were implemented in response to the virus and the impending economic shutdown. Businesses were deemed either essential or nonessential, which dictated how they could operate during the pandemic. Even with the transportation industry, we have some clients operating at 125 percent and others virtually shut down.
Although we had a pandemic landing page with many resources that were updated daily, we asked our teams to be more targeted and specific when assisting clients, depending on the individual operations. Our clients were getting so many COVID emails that even though we had that information, we didn’t want to just broadcast it all over the place.
Now we’ve shifted to restarting the economy and the steps necessary to protect employees, property, and the public. We’ve changed our “pandemic” page to a “reopening” page that has comparables and all topics related to safety and business reopening.
We’ve also developed a five-step process to reopening business that we presented during a webinar that attracted 10,000 attendees. Now we’re finalizing that same five-step process specifically for industry practice groups.
Scott: How has your approach to client engagement changed during this time?
Chris: I was doing weekly webinars for the entire practice and trying to advise everybody through the pandemic crisis. Whether it was on Freightwaves.com or just through clients telling us what was going on in the marketplace, we were helping direct some of our struggling clients to businesses that were really busy. I would say that it was pretty successful.
Just to give you one example: we had refrigerated clients that were hauling consumer goods to meet demand from panic buying. When the auto downturn happened, I was calling my refrigerator carriers and giving them the numbers of some of our struggling clients. In some cases, these people had never talked to each other before. So it was an interesting way to bridge that gap in the first two to three weeks while everything was up in the air.
Scott: Tell us how you’ve used data and analytics to better understand the business landscape and industry trends in order to develop scenarios for your clients.
Chris: Gallagher’s core strategy involved investing in data and analytics. We introduced Gallagher Drive, which offers benchmarking and claim analytics through aggregation of all of our client data. We can drill down to data in a region, in a state, and even down to a county level in order to help clients make better decisions.
We were able to say to clients, “Listen, here is exactly what the model is telling you about your performance in the past 10 to 15 years, if you were in this type of program.”
The adaptability of the technology has proven very valuable as we entered into COVID-19. So now we’re looking at different things. We’re not just giving straight-up recommendations on structure, deductibles, and claims analytics; now we’re looking at metrics including unemployment, consumer confidence, the Consumer Price Index, and other sources to help make decisions. We’re triangulating on how these metrics are impacting industries as a whole.
One example: unemployment is up right now, and workers’ compensation claims are down during the pandemic. It’s pretty easy to say you’re going to have less cost coming up. But is there more information out there, hiding deeper in the data? And how is the claim cost going to change over the next three or five years?
Scott: What are the other ways in which Gallagher is differentiating itself as an insurance broker?
Chris: I look at this in really three tranches. There’s innovation, implementation, and execution.
One of the differentiators we have on the innovation side is a tool that we use every day called CORE360. It uses analytical tools and diverse resources to make a more customized maximum impact on the cost drivers that affect our clients’ total cost to risk. We can look at six different cost drivers and individually adjust them so customers pay less in insurance premiums, less for retentions, less for loss control. By reducing the exposure on a contract, we can give clients recommendations on the total cost of risk.
Our Gallagher Drive technology is going to pay dividends for us because we’re finding innovative ways to use it—not just in doing the claims analytics, but in taking items in the COVID-19 pandemic crisis, adding them into the mix, and being able to predict three to five years out.
The second piece is implementation. And let’s just concede at the beginning: many of the larger brokers have products and services to offer. The thing that we feel we do much better—and the reason we grow at the rate we do—is that we do a great job of volunteering the services.
Once you volunteer them, the most important of the three is execution. How do you prove it? What we do with CORE360 is measure results from coverage negotiation to claims advocacy to all the other services that drive incrementally better pricing and optimize insurance program structure. That’s the culmination of quality brokerage services.
You’ve probably heard the sports term “flooding the zone.” It’s been common to have 10 or 15 people from our team on client or prospect calls in order to bring the thought leadership and solutions directly to the point of service, and it’s proven to be really powerful during this time. When you talk about the differentiating factors that play into a client or a prospect’s view of Gallagher, that’s something that we developed on the fly, and it turned out to be a really good strategy to bring solutions to real time.
Scott: Could you share thoughts or philosophies on strategy, your approach to business, and lessons learned during your career?
Chris: First, if you do a good job of recording the service you provide, you have the opportunity to aggregate it and tell a great story of quality service over time. I think that’s crucial for trust.
Second, the value in our business is telling your clients what you’ve done for them, what you’re planning to do, and then, most important, doing exactly what you say you’re going to do. Clients need to have quality information, data, and time to make critical decisions.
Last, as business leaders, we’re hopeful that the decisions we make continue to propel the business forward for the benefit of our employees, clients, shareholders, and the community at large. Seeing how the preparation, planning, and execution of strategies manifest in our service delivery really justifies our entire team’s vision for the future.