Transcript Restaurant Programs of America Broker Services Proposal

Restaurant Programs of America
Broker Services Presentation
Presented By:
Dean Carras, President
About RPA and Our Key Strengths
“The insurance industry recognizes us as the experts in the restaurant
industry and the restaurant industry recognizes us as the insurance experts.”
-Dean J. Carras
 Highly
experienced and knowledgeable staff of insurance
experts in the restaurant industry
 Respected by some of the most prestigious names in the
restaurant industry
 Developer of state of the art technology for our
restaurant clients
 Access to exclusive restaurant insurance products
through our affiliate, Innovative Coverage Concepts
Offices located in:
* Parsippany, NJ
* Langhorne, PA
* Middlebury, CT
* Asheville, NC
* Kansas City, MO
* Newport Beach, CA
* Palm Beach Gardens, FL
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A Few of Our Current Clients
 EHI/Doherty Allendale, NJ
Jerry Marcopoulos - (201) 818-4669 ext. 123
97 Casual Dining Locations
 Hooters of America Atlanta, GA
Matt Wickesburg - (770) 799-2238
205 Casual Dining Locations
 Miller’s Ale House Jupiter, FL
Mark Peterson - (561) 427-0055
60 Casual Dining Locations
 Rose Casual Dining Newtown, PA
Jeff Warden - (215) 867-1851
62 Casual Dining Locations
 Starr Restaurant Group Philadelphia, PA
Bruce Koch - (267) 238-3668
26 Fine Dining Locations
 Restaurants-America Chicago, IL
Ted Kasemir - (847) 510-2500
22 Casual Dining Locations
 TL Cannon Ponte Vedra Beach, FL
Ritch Mabry - (904) 273-9558 ext. 111
62 Casual Dining Locations
 Passion Foods Washington, DC
David Wizenberg - (202) 393-1510
10 Fine Dining Locations
 Commander’s Palace New Orleans, LA
Arlene Nessor - (504) 896-7626
4 Fine Dining Locations
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Our Value Proposition

At RPA, we take pride in delivering the best products and
services to our clients through a focused and specific
approach we take in the following areas:
 Coverage Analysis and Program Structure
 Marketing/Underwriting
 Written Commitment With Service Standards
 Loss Prevention/Safety
 Claims Mitigation
 Analytical Tools
 Assistance in Risk Management Services For Franchisees
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Coverage Analysis and Program Structure
We will conduct a full coverage analysis at each renewal to ensure that your exposures are
being properly addressed and that the appropriate program structure is in place.
Sample Coverage Analysis and Recommended Coverages Format
CURRENT POLICY
COVERAGE LIMIT / DEDUCTIBLE / ETC.
Carrier
AM Best Rating
Policy Period
Named Insured
Type of Form
Overall General Aggregate
Liquor Liability - Each Common Cause Limit
Liquor Liability - Aggregate Limit
XYZ Insurance Company
A+ XV
1/1/2012 - 1/1/2013
ABC Restaurant
Occurrence
$5,000,000
$1,000,000
$1,000,000
Employee Benefits Liability - Aggregate Limit
Employee Benefits Liability - Each Claim/Employee Limit
-Employee Benefits Liability Deductible
-Retroactive Date
Notice of Cancellation
Coverage Territory
RECOMMENDED COVERAGES
Trade Name Restoration / Food Borne Illness
Cyber Liability
Foreign Commercial Package
$1,000,000
$1,000,000 Each Employee
$10,000 Each Employee
November 1, 2011
30 days, except 10 for non-payment of premium
US, Canada, and Puerto Rico; international waters or airspace if injury or
damage occurs in the course of travel or transportation between locations in
US, Canada, and Puerto Rico; worldwide products; worldwide as respects
the activities of a person whose home is in US, Canada, or Puerto Rico but is
away for a short time on your business; providing suit is brought in US
COMMENTS
Add Broad Form Named Insured Endorsement
Increase to $2,000,000
Lower to $1,000 Each Employee or Claim
Request a 11/1/96 retro date
Increase to 60/10 or 90/10
Confirm whether insured's operations require a separate
foreign package policy
DESCRIPTION OF COVERAGE
Covers your loss of income should a food borne illness event causes one or some of your restaurants to close. Also covers
expense for clean-up and compliance.
Covers you for your liability arising out of a security breach in your network. Examples of losses that could occur include:
• Sensitive customer data is stolen from your network and you are required to incur substantial notification expenses.
• Customer credit card information is used to counterfeit credit cards and illegally use them to charge goods.
• One of your employees’ laptop is lost or stolen with sensitive customer or network security data.
Covers you for liability arising out of your operations/employees overseas. Based on your exposure, a few of the coverages this
policy will provide include: Foreign Commercial General Liability, Foreign Automobile, Foreign Voluntary Workers'
Compensation/Employer's Liability, Travel Accident & Sickness, Kidnap & Ransom/Extortion, Commercial Crime, etc.
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Marketing/Underwriting
The measurable improvements that we have helped our clients achieve in their overall loss
picture, coupled with our detailed carrier submissions, gives us a compelling story to tell
our underwriters, which enables us to provide broader terms and conditions, as well as
lower rates.
Sample of a few points included in a recent submission to strengthen the perception of our client’s risk:
“We started working with ABC Restaurant in April of 2011. ABC had adverse experience with general liability as
well as liquor liability claims. We worked with ABC to implement and monitor a number of Risk Management
initiatives which were designed to reduce the frequency and severity of liability claims especially liquor, and
slips and falls. Among the initiative implemented were:

A written corporate policy regarding the service of alcoholic beverages which includes a set of
procedures to monitor patron’s alcohol consumption, alerting managers if any party or individual
orders a third drink, offering free food, coffee, ordering and paying for cabs, alerting local authorities
if a patron refuses cab, etc. All managers then attended a seminar on the new policy when it was
rolled out in late 2011. This policy has also become a permanent part of the training module.

We have audited and totally redesigned ABC’s claims / incident reporting procedures in order to make
sure that when an incident occurs, we have put ourselves in the best possible position with regards to
defending the claim. Initiatives in this regard include:
 Web based online incident / claim reporting
 Reporting forms prefilled with pertinent information including a number of “drop down” dialog
boxes embedded in the forms so that we can make sure we capture important information such
weather conditions, location within the restaurant, condition of floors, lighting, etc.
 We have provided webinar based training on an ongoing basis to ensure that store managers
are able to access the forms and know how to fill them out.”
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Written Service Commitment
Day to Day Management of Your Account
In addition to the services outlined in this proposal, this is the service you can expect from
us if we have the privilege of writing your account:
Upon Receiving Your Order to Bind Coverage

Upon receiving the order to bind coverage from you, you will receive the following:
•
•
•
•
•
•
•
A revised version of our proposal incorporating any changes or revisions that are made as a result of
our proposal meeting,
A binder of insurance which will serve as evidence of coverage outlined in the proposal until the actual
policies are received from the carrier,
Automobile Insurance Identification cards (if applicable),
A claims kit which includes all of the forms and instructions in order for you to submit any type of
claim to us,
Your copies of any certificates of insurance which are required by your landlords, loss payees,
mortgagees, and other creditors or leinholders,
An invoice reflecting the premiums for all bound coverages, and
A premium financing agreement (if applicable).
Within Five Days of Binding Coverage

Online Claims Set-Up Meeting: Within 5 days of binding coverage, the senior members of your
service, claims and loss control service teams will conduct an online claims setup meeting in order
to introduce themselves and review the claims process with you.
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Written Service Commitment (cont’d)
Day to Day Management of Your Account
Ongoing Service Items

You will receive copies of claims acknowledgments within one day of the initial report.

Your copy of certificates of insurance requested by you will be mailed to you within 24 hours of
your request for the certificate unless you request it sooner, in which case it will be sent
immediately by fax, hand or overnight mail.

Loss runs will be sent to you on a quarterly basis, or at whatever periodic intervals you require.

All requests for endorsements (changes to your policies) will be acknowledged within 24 hours.

All phone calls will be returned within 3 hours or before the close of business on that day
whichever is sooner.

All correspondence from you will be responded to within 24 hours and acknowledged in writing.
120 Days in Advance of Each Renewal

At one hundred and twenty (120) days in advance of each renewal, the Account Service Team will
update all information and present your insurance program favorably to selected carriers.
Negotiations will be undertaken on your behalf with all carriers to insure the most favorable
renewal terms and conditions.
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Written Service Commitment (cont’d)
Risk Management Service Plan
Account Name
Policy Term
to
RMC Meetings
Quarter
Anticipated
Claims Performance Review
Loss Analysis
Date
Date
Date
Date
Date
Date
Scheduled
Completed
Scheduled
Completed
Scheduled
Completed
Claims Review Meetings
Stewardship Report
Date
Date
Date
Date
Anticipated
Scheduled
Completed
Scheduled
Completed
8
9
10
11
12
1st
2nd
3rd
4th
Individual location inspections/surveys
Month
1
2
3
4
5
6
7
Anticipated
Scheduled
Completed
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Loss Prevention Services

Loss Prevention is the most overlooked aspect in many
insurance programs
 The vast sums of money spent on “loss prevention” each year
by clients and carriers are mostly wasted. So-called “loss
prevention services” from insurance carriers are typically no
more than simple inspection services and/or libraries for
secondary information on loss prevention techniques, which
are often not utilized.

Our approach is much more focused and economical
 Using the tools and techniques we have developed in our
experience insuring restaurants, we find out exactly where
losses are coming from and develop practical, cost-effective
ways to help prevent future incidents.
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Loss Prevention Services (cont’d)

Risk Management Committee (RMC)
 The purpose of the RMC is:
• Create a forum for representatives from your organization, RPA, and the
insurance carrier to review your claims/loss activity and collect pertinent
information;
• Determine the root causes of your losses;
• Discuss and develop practical solutions/strategies for mitigating these
losses and preventing future claims;
• Establish action items and timelines for implementing corrective measures;
• Monitor the effectiveness of these measures.
 The RMC meets periodically throughout the year
 RPA tracks various claims performance indices from period to
period (quarterly, semi-annually, etc.), and uses the change in
these indices to determine the effectiveness of the Risk
Management Program we have implemented.
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Loss Prevention Services (cont’d)
Sample of a few action items that resulted from a recent Risk Management Committee Meeting:
1. The committee has observed a pattern of employee cut claims arising out of employees using knives to open bags. It
was determined that the use of the "Viper" and "Pouch – Mate" bag openers could alleviate this problem.
ACTION – RPA will provide vipers and pouch made bag openers for use in the ASI stores.
Responsibility – Gundi
Completion due date – June 30, 2012
2. Written self – audits are completed by ASI on each store annually. In addition, ABC International inspects a random
sample of stores each year. Also, Chartis has committed to conducting physical surveys of 10 locations in the current
policy term.
ACTION – RPA will do a store ranking by frequency and incurred dollars in order to determine which stores
we would like to have surveyed.
Responsibility – Nick Galakis
Completion due date – June 30, 2012
3. In the claims review, several claims involved guests slipping on wet floors in the bathrooms. The notes in one of the
claims suggested that the protocol is to inspect bathrooms four times per hour and another claim suggested that the
protocol was to check the bathrooms once per hour. There also seems to be some confusion as to whether or not the
stores are required to keep paper logs of the bathroom inspections. It was determined that Debbie will double check
on the protocol that is currently in place. The committee generally agreed that it was not a good idea to keep any sort
of log with regard to the bathroom inspections, as this information is discoverable and could tend to weaken our
position in the defense of the claim.
ACTION – Determine the protocol for inspecting bathrooms on an hourly basis.
Responsibility – Marc Fabrizio will contact Debbie to confirm status of current protocol.
Completion due date – May 30, 2012
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Loss Prevention Services (cont’d)

Loss Control Engineering Surveys
 Our proposed services include the following:
• We will conduct a survey at the corporate level of your existing operational
policies and procedures for safety and loss control in the areas of General
Liability, Workers’ Compensation, and Property exposures in order to make
sure that all potential exposures to loss are addressed.
• We will compile a General Liability, Workers’ Compensation and Property
claims analysis and develop a Loss Cause Analysis to identify Loss Leader
Categories and Loss Leader Locations.
• We will conduct field surveys at a select number of locations in order to
audit compliance with corporate policies, and to identify specific hazards
and conditions, both physical and operational which can lead to losses. We
will also offer suggestions for improvements for any such hazards and
conditions.
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Loss Prevention Services (cont’d)

Lease and Contract Review
Sample of a few observations/recommendations we made to a client regarding one of their leases

As you surmised, the lease only requires you to insure your trade fixtures, equipment, inventory, and other
contents. (See Item 7.(2)) You definitely are not required to insure the building. Item 6.(b) reinforces this
fact by indicating that the Tenant is to pay all charges passed through to the Landlord, including the
Landlord’s share of the cost of insuring common areas. Furthermore, in a strip center with many tenants, it
would be improbable that you would be responsible for insuring the entire center and it would be impossible
to insure just the portion of the building you occupied. In all such centers, the Landlord insures the building
and, often, each tenant must pay its proportionate share of that cost. That certainly seems to be the case
here.

If the building had a fire loss, the insurance carrier insuring the building for the Landlord would be required
to pay for the damage to the building and your insurance carrier would be required to pay for the damage to
your fixtures, equipment, inventory and other contents. While the lease makes no mention of
improvements and betterments, contents coverage normally covers the cost of such I&B’s if you have paid
for them.

The Landlord’s request to increase the limits of your insurance from $1 Million to $1.6 Million is
unjustified. Many leases contain a provision allowing the Landlord to require increases in coverage after a
certain period of time has elapsed or based on what similar risks in the same geographical area normally
carry. Often, such clauses use the word “reasonable.” However, there is no such provision in this lease.

Item 26.(a) contains an indemnification provision for any liability or costs arising from Tenant’s use of the
premises, any breach of the lease, or any other act or omission of the Tenant. While not unusual, this
indemnification provision is quite broad, requiring Tenant to indemnify for a wide variety of acts or
omissions . You should be aware that insurance companies will insure such an indemnification obligation
only as respects tort liability. Your obligation to defend other claims not involving personal injury or
property damage are outside the scope of insurance.
Interestingly, indemnification for tort liability (which is covered by your insurance) is included in the
Tenant’s requirement, but not in the Landlord’s requirement.
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Loss Prevention Services (cont’d)

Restaurant Risk Management Technology
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Claims Mitigation

Left to their own devices, insurance company claims
departments and TPAs do not give their claim files the
amount of attention that we feel is necessary to keep
losses to an absolute minimum. Our claims mitigation
process includes the following:
• Prompt investigation
• File documentation
• Reserve setting
• Frequent follow-up
• Periodic claims review meetings
• Reserve underwriting alerts
• Underwriting alerts
• Access to adjuster notes
• AcuComp
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Analytical Tools

Focused Loss Analysis
RPA has come up with statistical methods which are useful in
measuring the effectiveness of the RPA Risk Management
Program. Some of these techniques are listed below:
 Analysis of your historical losses and exposures
 Establish “grades”
 Set Benchmarks and Goals
•
•
•
•
Average Claim Size
# of Claims per $ Sales
% of Claims Closed Without Payment
$ Claims per $ Sales
RPA tracks various claims performance indices from period to
period (quarterly, semi-annually, etc.), and uses the change in
these indices to determine the effectiveness of the Risk
Management Program we have implemented.
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Analytical Tools (cont’d)
Sample Workers’ Compensation Claims Performance Exhibit
Workers' Compensation Loss Analysis - Valued at 5/1/12
A
B
C
D
E
F
G
Incurred
Capped at
H
I
J
K
Ultimate
Ultimate in
Capped at excess of
Paid
Reserves
Incurred
$250,000
Uncapped
Ultimate
Loss
$250,000
$250,000
2007
164
$140,077
$0
$140,077
$140,077
$140,077
$140,077
$0
$55,926,220
1.000
2008
133
$877,623
$83,154
$960,777
$910,047
$1,114,501
$1,015,654
$98,847
$44,897,374
1.160
2009
96
$92,160
$20,336
$112,496
$112,496
$136,007
$136,007
$0
$47,276,754
1.209
2010
124
$370,644
$119,604
$490,248
$490,248
$642,225
$642,225
$0
$43,730,756
1.310
2011
34
$25,505
$18,868
$44,373
$44,373
$284,873
$284,873
$0
$46,972,317
6.420
$425,899
$413,217
$508,203
$483,491
Policy year Total Claims
Average x Current Year
Claim Counts
A
LDF
Claims Performance
B
C
D
Total Claims
Closed
Claims
Open
Claims
2007
164
164
0
13
44
107
2008
133
130
3
22
44
67
2009
96
95
1
8
70
18
2010
124
120
4
18
87
2011
102
32
2
18
72
Policy year
Payroll
E
F
LT Claims Med Claims
G
A
RO claims
Policy year
B
C
D
E
Loss $ rate per $100 Payroll
Capped
Capped
Incurred
Ultimate
Unlimited
Unlimited
Incurred
Ultimate
$250,000
$250,000
F
G
Closed
LT # claims /
#claims/total
$1MM
#claims
Payroll
2007
$0.25
$0.25
$0.25
$0.25
100%
0.23
2008
$2.14
$2.48
$2.03
$2.26
98%
0.49
2009
$0.24
$0.29
$0.24
$0.29
99%
0.17
19
2010
$1.12
$1.47
$1.12
$1.47
97%
0.41
4
2011
$0.09
$0.61
$0.09
$0.61
94%
0.38
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Analytical Tools (cont’d)
Sample General Liability Claims Performance Exhibit
General Liability Loss Analysis - Valued at 4/22/12
A
B
C
D
E
F
G
Incurred Loss
capped at
H
Ultimate
Loss
capped at
J
K
Total Sales
LDF
Policy
Year
Total
Number of
Claims
2006
200
$608,540
$0
$608,540
$252,521
$608,540
$252,521
$356,019
$152,400,000
1.000
2007
232
$211,927
$0
$211,927
$185,402
$211,927
$185,402
$26,525
$158,850,000
1.000
2008
266
$233,021
$90,000
$323,021
$263,702
$424,450
$319,657
$104,792
$163,500,000
1.314
2009
254
$55,523
$38,400
$93,923
$93,923
$140,603
$140,603
$0
$165,000,000
1.497
2010
273
$45,388
$26,312
$71,700
$71,700
$134,366
$127,392
$6,974
$159,950,000
1.874
2011
109
$6,979
$104,333
$111,312
$99,239
$509,809
$362,535
$147,274
$164,000,000
4.580
Total Paid
Loss
Total
Reserves
Total Incurred
Loss
$25,000
Unlimited
Ultimate
loss
I
Ultimate
Loss
excess of
capped
amount
$25,000
Loss Rates
Claim Counts
Claim Count
C
Open
Claims
D
Closed
Claims
CWOP
CWOP%
A
Policy
Year
2006
200
0
200
163
82%
2006
$3,043
$3,043
$3.99
$3.99
1.31
2007
232
0
232
193
83%
2007
$913
$913
$1.33
$1.33
1.46
2008
266
2
264
225
85%
2008
$1,214
$1,596
$1.98
$2.60
1.63
2009
254
3
251
226
89%
2009
$370
$554
$0.57
$0.85
1.54
2010
273
5
268
251
92%
2010
$263
$492
$0.45
$0.84
1.71
2011
262
27
82
100
92%
2011
Standard
$426
$480
$1,949
$2,200
$0.68
$0.40
$3.11
$1.85
1.60
0.8
A
Policy
Year
Standard
B
E
F
80%
B
C
Avg Claim
Incurred
Ultimate
D
E
Loss Rate
Incurred
Ultimate
F
Claim Rate
Per $1 million
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Risk Management Services for Franchisees
 Best
Practices - Safety Protocols
 Access
tools
to customized web-based risk management
 Establish
uniform insurance requirements
 Explore
potential for developing specific insurance
program for your franchisees
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National Accounts Team Members
DEAN J. CARRAS - President
Dean Carras has spent more than 30 years in the insurance industry, focusing on specialty programs.
Early in his career he foresaw how concentration on a market niche creates value for policyholders—
better coverage at lower prices. Today, his companies have five offices and write thousands of
restaurants throughout the country, including some of the most well-known and prestigious ones. As
an individual who continually demonstrates results and an unswerving integrity, Dean has earned the
trust and confidence of restaurateurs around the country as well as insurance industry executives.
PAUL P. GIUNTO – Senior Vice President
Paul Giunto’s early insurance career involved major posts at large brokerage firms, including Johnson
& Higgins, Marsh & McLennan, and Aon. A graduate of St. Vincent College, Paul earned his CPCU
designation in 1977. He has been involved in high levels of responsibility for automation,
property/casualty operations and creation of specialized insurance programs. Paul joined ICC’s senior
management team early in 2009 and will be intimately involved in direct production, building a sales
team, and assisting with the development of various new initiatives.
JEFFREY M. HALLMAN - Vice President/National Accounts
Jeff Hallman launched his career with a major insurance company more than 30 years ago, and is a
cum laude graduate of the Wharton School, University of Pennsylvania. He specializes in large
businesses with complex insurance needs, and his extensive experience with hospitality accounts is
put to good use managing RPA’s National Accounts Department.
PHILIP LIEBERMAN, CPCU, CLU – Vice President
Phil Lieberman has over 35 years of experience in the insurance industry. He joined the firm at its
inception and has since been involved in all aspects of the firm’s operations. Phil is a graduate of Yale
University and is the firm’s primary resource for contract analysis and coverage issues.
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National Accounts Team Members (cont’d)
DAVID R. HAMBLETON – Senior Account Executive
David’s industry experience spans more than 30 years beginning with his early years on the
underwriting side at both Hartford Steam Boiler and Chubb. Most of his career has been spent on the
brokerage side with international brokers such as Johnson & Higgins, Willis and Marsh, where he
managed a portfolio of middle market property/casualty accounts and was responsible for program
design, market negotiations, program implementation, and ongoing servicing.
JOSEPH PEREZ – Senior Account Executive
Joseph Perez has over 27 years of experience in the property casualty insurance industry as an
underwriter, management consultant and broker. His expertise includes program design, marketing
and coverage analysis. He is well verse in different risk financing techniques including guaranteed
cost, large deductibles, self-insurance and captives.
JUNE LEMONGELLO – Client Services Manager
With more than 27 years of experience in the insurance industry, June Lemongello oversees
marketing, underwriting and internal service activities for RPA. She has worked in Client Servicing in
the restaurant division of The Dining Car Agency, Wachovia Insurance Services and now RPA.
MARC FABRIZIO - Claims / Loss Control Manager
Since 1988, Marc has been intimately involved with claims management. For over ten years, he was
on the front lines of litigation defense, attending trials and arbitrations, conducting claims audits, and
adjusting claims for major insurance companies and third party administrators. He will be working
with clients in developing and implementing loss control protocols, as well as assuring that we provide
excellence and responsiveness in our delivery of claims service.
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National Accounts Team Members (cont’d)
NICHOLAOS S. GALAKIS - Risk Management Specialist
Nicholaos S. Galakis is a risk control professional with over twenty five years in property and casualty
loss prevention and client management expertise. In addition to loss control, he has managed all
aspects of broker relations and customer service including technology support, technical services,
underwriting, claims, loss control & relationship growth.
MARTIN D. MICK – Technology Development Specialist
Martin D. Mick has been involved in the restaurant industry as operator, consultant and business
service provider for 35 years. Early work included service as a senior executive of a 1400-unit
national chain. Through his own company he has provided specialized consultative services in the area
of turnaround management, serving as CEO, COO and Board member for both public and private
companies. He is the author of Food Safety Management and Compliance and has provided national
media commentary on risk management related to the multi-unit restaurant environment. Mr. Mick is
a developer of interactive web-based tools and custom digital services to the restaurant industry
through RestaurantRiskManagement.com.
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What Can You Expect as a Result of Doing
Business With RPA?

RPA will work diligently as your partner to deliver
world-class insurance and risk management program
designed to:
 Get your losses down to an absolute minimum.
 Relentlessly market your account to the insurance
marketplace in order to get the lowest possible rates that the
market will bear.
 Help you in developing best practices and programs for your
franchising operation.
 Make sure your are covered appropriately for all of your
exposures to loss.
 Point out areas in which you are not currently insured.
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