Case Study: Single Family Office Searches for New Broker to Educate Next Generation and Craft More Specific Coverages with Atténuer Risk

Summary

In this success story, we share how a single-family office (SFO) with multiple generations and unique coverage needs for their asset and liability exposures, including for those participating on boards, searched for a new broker with the help of Atténuer Risk. Kate Norris, Founder of Atténuer Risk, used the firm’s proprietary Request for Proposal (RFP) and scorecard to help the SFO evaluate and select the right broker. With the right broker team in place, the family now has both an educational asset for the next generation and a team helping them place the right coverages that best suits each household’s needs.

The Challenge

The SFO was uncertain if their current property and casualty (P&C) broker was up to the task of continuing to serve the family members and the family office. The family, which included three generations across 15 households, had been working with the broker for more than 25 years. However, the family now felt they had outgrown the broker and reached out to Atténuer Risk to help conduct both a risk blueprint and a robust broker search.

Phase One Approach: The Risk Blueprint

For the initial phase of the project, Atténuer Risk conducted a “risk blueprint” that evaluated the one household’s risk profile, coverage, and mitigations in place as well as provided a high-level review of the family office coverage. The risk blueprint for the second-generation household revealed that the household was underinsured for fine art and liability exposures.

Additionally, the review of the family office business coverage identified policy deficiencies for board participation and trustee work as well as professional liability. The issues uncovered along with a recent subpar claim experience with the current broker prompted the family office to hire Atténuer Risk for phase two of the project: a robust broker search.

Phase Two Approach: The Broker Search

Atténuer Risk conducted a vigorous broker search to find a team to handle the multiple needs of the SFO’s as well as the coverage needs of multiple generations and households. Consequently, the broker needed to be nimble and work collaboratively to solve for the family’s board participation and trustee work, a serious liability risk if not properly addressed. Additionally, the broker needed to be able to help educate the third generation on insurance basics and to communicate effectively across all three generations and the family office.

Based on the phase one project results as well as many conversations with the second-generation (G2) lead and family office executives, Atténuer Risk established the baseline criteria for potential brokers and created a custom RFP used to vet invited brokers. The RFP addressed both the household needs along with the needs of the family office’s business.

Atténuer Risk tapped into its unique knowledge of the broker community serving family offices to create a concise list of broker firms to participate. All in all, Atténuer Risk selected five broker firms, the G2 family lead requested one broker firm, and the incumbent broker was asked to participate. Each invited broker held a one-hour call with Atténuer Risk to review the RFP and answer their questions. The RFP did not disclose the family or specifics of the family’s risk management architecture. Brokers had three weeks to complete and return the RFP responses along with sample materials.

Upon receipt of the RFP responses for the SFO, Atténuer Risk evaluated the answers usings its proprietary scorecard and discovered that three firms were the better fit for the family. As a next step, Atténuer Risk held an RFP review call with the G2 family lead and the SFO executives, and based on the scorecard results, the team agreed to move forward with interviewing the top three brokers with all three signing an NDA.

Overall, the three interviews uncovered additional areas of strength for each broker. The family was searching for a personality fit and service model that best suited their needs as well as a team who could work with the third generation and help solve for the unique coverage requirements of the business of the family office.

The Outcome

In the final analysis, the broker selected had an incredible team lead, a day-to-day client contact who the family felt would be an asset for their next generation family members and an expert at crafting coverage specific to their family office situation.