At a Town Hall meeting hosted during NAPSLO's Mid-Year Leadership Forum at the Marriott Resort in Harbor Beach in March, leaders representing the two largest professional surplus lines organizations spent 90 minutes laying out their strategy for the coming months — including the timeline for the approval vote, details on which annual events would still take place (and when) should the merger come to pass, and a long list of additional details sorted out after months of due diligence by the Merger Committee.

NAPSLO President Dave Leonard; AAMGA President Ed Levy; Hank Haldeman, NAPSLO past president and chairman of the AAMGA-NAPSLO Merger Committee; AAMGA Treasurer Bobby Owens, vice chairman of the AAMGA-NAPSLO Merger Committee; and NAPSLO Executive Director Brady Kelley took the dais to outline the greater purpose and finer points of the proposed new organization, which, if AAMGA and NAPSLO members were to vote to join forces, would create WSIA — the Wholesale & Specialty Insurance Association.

Among the benefits outlined to members: a single, rebranded organization with renewed energy and purpose; a simplified menu of programs and services; a larger, unified voice in its legislative and regulatory advocacy; cost savings gained by combining the management of the two separate organizations; synergy in committee and volunteer work; and refinement of existing networking events.

After about an hour of hearing the committee state its case, a question came from the back of the room.

“Is there anyone who wouldn't see this as a good idea?” one audience member asked. “This seems like a no-brainer to me.”

It was an excellent question, but not one of the committee members viewed it that way. They had never regarded the union of NAPSLO and AAMGA as a given, a done deal or a “no-brainer” of any sort. They had spent months busy hashing out every last detail, and knew that a merger of that magnitude had to be thoroughly studied from every possible angle.

An end and a beginning

Their diligence paid off. In July, members of both organizations made their voices heard, reaching a majority vote to merge under one banner and move forward as WSIA. It marked the end of one journey, and the start of a far greater one — and those who worked behind the scenes to ensure every conceivable angle was covered during the former process can now reflect on that work while embracing WSIA's future.

“While I had known and worked with most of the members of the Merger Committee and knew that they would be collaborative and cooperative, I was nonetheless surprised and impressed with the commitment that each member of the committee brought to bringing this effort to successful conclusion,” said Haldeman, Executive Vice President and Director at The Sullivan Group in Los Angeles.

Both organizations invested $75,000 to support the work and due diligence in studying the risks, benefits and pure feasibility of a union. Recommendations were made to the boards of both organizations, with each maintaining independent authority regarding the advancement of a merger proposal.

“We covered a lot of turf, but it really helped that we broke it all down into six distinct areas or topics and divided that work up among subcommittees supported by individual staffers,” Haldeman continued. “However, none of that really addresses what stands out perhaps the most, which is that this was yet another example of leaders from within a fiercely competitive industry being able to set aside competition and work together toward our common interest and build or further develop mutual respect and genuine friendships through this process.”

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Credit to Merger Committee

In addition to Haldeman and Owens, the merger committee included Harry Johnson of Johnson & Johnson Inc.; Corinne Jones of AmWINS Access; Mark Maucere of Arlington/Roe; CRC Wholesale Group's Dave Obenauer; Jacque Schaendorf of Insurance House; Kathy Schroeder of Sierra Specialty Insurance Services; and Western World's Gary Tiepelman.

“The merger committee did incredible work,” said Ed Levy, AAMGA immediate past president and Vice President, Western Region for Risk Placement Services Inc. in Scottsdale, Ariz. “They were thorough, fair, open-minded and considerate of all members' concerns.”

For Owens, President of the Programs Division at RPS Lexington, the largest surprise of the whole process was the amount of detail the staff was able to put together within the Plan of Merger. “The Committee did an excellent job of identifying all points of discussion and contention and was efficient at identifying solutions to every issue,” he said. “The staff took our work and dove into the detail needed to develop a comprehensive merger plan. It was quite a remarkable process.”

Indeed, the letter of intent to merge, the detailed governance bylaws for the new organization, the structure of the board and committees, the selection of the best representatives from each organization to serve as initial leadership, and the thoughtful design of the classes of membership are all just a few examples of the intense amount of effort put in by the group, said Dave Leonard, NAPSLO past president and Chairman/CEO of RSUI Group Inc. in Atlanta.

“Even the creation of the new logo and branding came from the committee,” Leonard noted. Its members, he added, “were clearly committed to create a totally new organization, combining the best of each predecessor, with the goal to enhance the benefits provided to the combined membership. That says to me they all believed it was a beneficial undertaking.”

The Merger Committee's members were also rewarded with a deeper understanding of the many things they had in common, said Haldeman: “Perhaps most telling was the fact that we took votes on virtually every choice, decision and recommendation along the way, and the committee really covered a broad swath of issues and actions — and not one single time was the vote anything other than unanimous.”

A single voice for surplus lines

While it might be tempting to perceive the union of AAMGA and NAPSLO as having the effect of raising the profile of the E&S market, many Members view that equation in reverse order.

“I think that the elevated profile of surplus lines and delegated underwriting solutions resulted in the merger rather than the other way around,” says Leonard. “The two organizations knew the strengths of the specialty insurance business, recognized the strengths of the two associations, and knew that bringing them together would better support what is a very important component of the insurance business.”

“There really are many ways, short and long term, in which the merger will benefit our industry and the clients that we serve,” added Haldeman. “Our ability to speak more clearly as an industry, in a single voice, with a higher profile, and a brand which accurately states who we are — the Wholesale and Specialty Insurance Association — immediately enhances our ability to communicate effectively with legislators and regulators, a function critical to the growth of our industry and its ability to bring innovative and challenging insurance solutions to the insurance buyer.”

Going forward, Levy sees WSIA having a stronger voice in regulatory and legislative efforts, broader education opportunities for members, “increased presence on college and university campuses — which will then create sustainability by offering recruiting opportunities for members, and a larger voice in the form of marketing and supporting the value and benefits of the wholesale distribution model.”

The new organization “has the inclusive membership and financial resources to be a very effective leader for the wholesale industry,” Owens adds. “Every sub-group within wholesale is now represented and the issues between each group can be efficiently coordinated. This will prove to strengthen the surplus lines industry by having such a strong organization supporting and advocating for the industry and should help expand the industry's reach into the future.”

Special Reports /

Stronger together: The journey to creating WSIA

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