Tight-Knit Broker Community Hard Hit

The attack by terrorists on Sept. 11 in New York City andWashington changed peoples lives and altered the future of theinsurance world in a way that few can fathom, insurance brokerageofficials say.

There was much speculation in the weeks following the attack onthe World Trade Center about the overall cost to the industry, withestimates running as high as $75 billion. Many brokers were busyassessing claims, securing new offices, counting the missing andsaying a prayer for those lost and their families.

The ruins need to be sifted through and carted away, thecasualties counted, and plans put in place to rebuild bothstructures and lives before the final assessment of losses can bemade.

Within the industry, two of the worlds largest insurancebrokerage firms, New York City's Marsh and McLennan Companies, andChicago-based Aon were the hardest hit. Between them, more than 500people are reported missing. In addition, a couple of employeeswere on board the highjacked planes.

Dealing with the attack, both brokerage firms put on their riskmanager caps and put their disaster plans to work, moving the morethan 2,700 employees who worked in the twin towers to new locationsthroughout the New York and New Jersey region.

Data needed to be recovered, phone lines hooked up, computersystems established. The business of working with customers–bothwith claims from the attack and business unrelated to thetragedy–needed to continue.

Notices went out to clients through e-mail, over the brokerages'Web sites and in newspapers, reassuring them that business wouldcontinue. And the families and colleagues of those lost needed tobe cared for as well.

“This is a terrible time for all of us,” said Jeffrey W.Greenberg, MMCs chairman, in a statement. “Our hearts, thoughts andprayers are with all of those who are lost or are suffering.”

“Our first concern has been, and continues to be, for thewell-being of our employees,” echoed Patrick G. Ryan, Aons chairmanand chief executive officer.

However, the damage was not limited to those in the World TradeCenter. The attack closed down offices nearby, including thedowntown New York offices of London-headquartered Willis, a fewshort blocks from “Ground Zero.”

No one from the firm was lost or injured, but employees andfunctions needed to be moved to offices in New Jersey after thedisaster area was shut down. The firm did not speculate on when itwould be moving back to lower Manhattan.

While buildings and data are the tangible elements that caneventually be quantified and replaced or repaired, the loss of lifeis another matter–especially in the closely-knit brokeragecommunity, despite its competitive nature.

“A lot of us have been affected by this,” observed KennethSciara, president of Hilb, Rogal and Hamilton of New York, whosemidtown Manhattan offices were not directly affected by thedisaster. “[Insurance brokers] are a close-knit group. We lost alot of friends and former employees.”

Insurance brokerages are reaching out to one another, offeringhelp in whatever way they can–for example, in some cases offeringoffice space to those displaced by the terrorist attacks.

“We are usually very strong competitors, but this is a time toget together and help,” Mr. Sciara said. “New York brokers aresticking together and no one is trying to take advantage of theothers. We are sensitive to how Aon and Marsh have been hit bythis.”

Liz Cougot, assistant vice president and director of corporatecommunications for Glen Allen, Va.-based Hilb, Rogal and Hamilton,said the brokerage has offered to help Marsh, Aon, and Frenkel& Company (a New York regional broker) with office space, claimservice and “whatever else they need from us.”

Executives at San Francisco-based USI Insurance Services weremeeting in New York and witnessed the attack, including Bernard H.Mizel, chairman and chief executive officer for the firm, saidThomas ONeil, chief executive officer of USI's Northeastregion.

USI's New York offices of 140 employees at Park Ave. and 32ndStreet were temporarily moved out of the city to surroundingsuburbs after communication lines were disrupted. It took a coupleof days to reroute traffic, said Mr. ONeil, but the infrastructureremains in good shape. Employees have since returned to theiroffices after communication lines were restored.

However, of bigger concern is for employees who have lostfriends and associates they had worked closely with in the WorldTrade Center, Mr. ONeil noted.

Both Marsh and Aon have established centers for family andemployees to go for help, including psychological support to copewith the situation.

The grief is no less at other brokerage firms, and executives atHilb, Rogal and Hamilton and USI said counselors have been broughtin to help.

“This will be a long and protracted cleanup and rebuilding,”according to Mr. O'Neil, who said that people will need emotionalsupport throughout the process of mourning and rebuilding.

Reproduced from National Underwriter Property &Casualty/Risk & Benefits Management Edition, October 8, 2001.Copyright 2001 by The National Underwriter Company in the serialpublication. All rights reserved.Copyright in this article as anindependent work may be held by the author.

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