A private equity institution was looking for ways to grow their real estate division. Traditionally their strategy focused on acquiring existing assets, however transitioned to greenfield development projects. As part of CPG’s strategic insurance and risk review, it was discovered that their insurance policies contained several critical exclusions, including all development and construction work. These exclusions exposed their entire $100,000,000 development portfolio in the event of a loss. CPG worked with the client’s preferred insurance representatives to design a closed-gap insurance program that was aligned to their business strategy. Not only were these critical coverage exclusions eliminated, but CPG was able to lower the clients premiums.

The lender on a large development project required the builders risk coverage to include the full insurable value of the project. Since the location was within an earthquake zone, the additional premium on excess coverage was substantial. Through catastrophic modeling, CPG was able to determine that the probable maximum loss was substantially lower than the insurance limit requirements being enforced by the lender. Working with the lender CPG was able to negotiate a builders risk earthquake sub-limit of $50,000,000. This coverage was not only suitable for the project, but provided premium savings of roughly $1,000,000.

The general contractor on a construction project had insufficient professional liability coverage to satisfy our client’s insurance requirements. The incremental cost to secure this additional coverage was quoted at $408,000 – a cost that was going to be absorbed by our client. As the insurance and risk advisor on this construction project, CPG explored alternative options to effectively mitigate a professional liability loss and tabled the idea of utilizing an owners protective professional indemnity (OPPI) insurance. CPG was able to enroll the project in an OPPI program at a cost of $114,000 – saving the project $294,000 with better overall coverage.

A sporting agency with limited risk management protocols began experiencing a high volume of claims. Due to their troubling loss history, their insurance premiums were expected to increase over 500%. CPG proposed the idea to self-insure the first $1,000,000 through a self-insured retention (SIR), and re-insure the excess liability. To maintain an effective SIR program, CPG developed a comprehensive risk mitigation plan to significantly reduce our client’s self-insured losses. The implementation of this strategy not only provided insurance cost savings of over $1,000,000, but greatly reduced the number of claims and self-insured losses through fostering a risk management culture.

During a major weather event one of our client’s buildings was damaged; however not reported to the insurance carrier. The property manager subsequently filed a claim months after the incident, which was then denied for failure to notify. The out-of-pocket expenses to repair the damage was estimated at over $640,000. CPG was engaged to review the situation and work with the insurance carrier on a resolution. Based on our client’s loss history and proactive approach to loss prevention, CPG successfully negotiated the payout of fifty percent of the loss, which amounted to over $320,000.

As insurance markets continue to tighten, insurance carriers continue to look for ways to de-risk and underwrite accounts where they feel comfortable with their exposure. CPG has worked closely with an asset manager to develop a comprehensive insurance and risk management program that addresses all critical processes within their business. With an effective governance process in place, CPG is able to provide assurance to underwriters that risks are being adequately mitigated. With these processes in place, CPG was able to put the client in the best light come renewal and able to secure favourable coverage terms and pricing – resulting in savings and premium avoidance of over $3,200,000 annually.