Conglomerate Commercial Insurance Case Study

Striking that balance requires a deep understanding of three things: our clients, their businesses, and the broader commercial insurance landscape. Unlike insurance brokers, who simply sell insurance, insurance consultants provide comprehensive, tailored, strategic, big-picture recommendations and guidance.

This case study illustrates how the commercial insurance consulting firm of MB Davis Group managed this exact balancing act for a recent client.

Get to Know the Client

One of MB Davis Group’s clients is a large conglomerate that does approximately $200 million in annual revenue. Owned by a prominent family and employing many people across the United States, this conglomerate owns multiple businesses under the umbrella of the parent company.

Rather than working in one static industry, they operate in several arenas. Some examples include:

• real estate,
• technology,
• warehousing,
• and manufacturing.

Inheriting a Great Master Insurance Policy… with Room for Improvement

When taking over this account, MB Davis Group was fortunate. The client’s insurance broker was excellent and had put together a competent, convenient, effective insurance program.

This master insurance program covered the entire conglomerate, offering numerous advantages for both MB Davis Group and the client:

• Only navigating and maintaining a relationship with one underwriter
• Benefiting from a large umbrella limit
• Avoiding the need to buy and to manage many separate insurance programs
• Generally enjoying a comprehensive insurance program that made life easier

However, there was a catch that left room for significant improvement in this client’s insurance program. Certain businesses have specialty exposures, which are best addressed with specialty insurance policies.

Some common examples include:

• Oil and gas businesses, which have downhole (underground) exposures
• Warehousing businesses that take possession of other people’s property to put in their warehouse, which creates warehouseman’s liability exposures
• Manufacturing businesses, which have spoilage, product recall, and other relevant exposures

The conglomerate owns numerous businesses with these kinds of specialty exposures.

While the existing master insurance program simplified everything, it did mean the conglomerate client was missing out on the benefits of specific policies designed to cover industry-specific exposures.

When handling a client that operates in multiple arenas, part of a commercial insurance consultant’s job is to effectively navigate the idiosyncrasies that come with each of those businesses.

Maximizing the Existing Commercial Insurance Program: Accounting for and Finding Relevant Exposures

Over approximately six months, MB Davis Group visited each of the conglomerate’s different companies. During that time, the commercial insurance consulting firm became extremely knowledgeable about the operations within each of these businesses.

“Commercial insurance consultants shouldn’t start with the insurance. They need to understand the business first,” said Mitch Davis, MB Davis Group founder and lead commercial insurance consultant. “When you don’t understand the business fully, it’s like a liver specialist offering a health solution—without even looking at the rest of the body. Only when you know the business from the ground up are you in a position to provide the appropriate solutions.”

As a result of this groundwork, MB Davis Group could put together a commercial insurance policy that retained the effective master insurance program but baked in numerous enhancements specific to individual businesses.

• Downhole exposures for their oil and gas segments
• Warehouseman’s exposures for their contract work

In this process, MB Davis Group even identified an exposure that wasn’t being properly addressed. It was an unusual exposure known as hired and non-owned auto (H/NOA). While most people reviewing their insurance program wouldn’t think this was a major issue, for this conglomerate, it was a significant exposure.

One of the company’s divisions hired dozens of contractors, and these workers used their own private vehicles to get back and forth from work. In this company’s case, it was urgent to address this exposure, and it ended up being caught and rectified before it became a financial issue.

Creating the Best of Both Worlds in the Client’s Commercial Insurance Policy

“With this client, we inherited a good insurance program and were able to make it even better,” said Davis. “After careful review of the client’s business structure, we made their insurance more appropriate for all exposures. Not just one.”

As a result of this diligent legwork, MB Davis Group delivered their conglomerate client a commercial insurance policy that both retained its simplicity and accounted for the nuance of the company.

“We’re getting to the point where their policy truly offers the best of both worlds,” said Davis.

Does Your Commercial Insurance Program Give You Specialized Coverage… without the Headache?

Are you receiving adequate insurance coverage? Are you also avoiding needless hoops and complexity in your commercial insurance program? Striking that balance requires extensive knowledge about you, your business, and the commercial insurance landscape at large.

Finding that knowledge and getting personalized answers to your questions isn’t easy, though.

That’s why MB Davis Group offers free consultations. These are opportunities to talk to an actual commercial insurance expert about your specific insurance program, questions, and concerns.

If you’re ready to talk to a commercial insurance consultant who offers this balanced approach, book your no-cost consultation today.