Commercial property owners need to protecttheir assets, and a focus on resilience is an im-portant way to mitigate property risks, advisesRichard Montminy, head of property at ZurichGlobal Corporate in North America. In this RiskPerspective presented by Zurich, he discussesmarketplace trends and shares insights on prop-erty risk management.

What trends is Zurich seeing in 2016 in the property in-surance marketplace?

The market is seeing an abundance of capacity,driven in part by the entry of new and alternative playersin commercial insurance. These include non-traditionalinsurers, start-ups and investors seeking new opportu-nities. At the same time, we are continuing to see down-ward pressure on property rates. In the past, we used todescribe the market cycles as “soft” or “hard,” but thesearen’t really coming into play anymore; it’s just the mar-ket. The marked reduction in insured catastrophe losseshas also been pressuring both insurance and reinsur-ance rates downward. At the same time there has beena continued flow of attritional and large losses hitting themarket, including most recently the Fort McMurray wild-fires in western Canada. Even though these losses ap-pear to be putting a slight damper on rate declines, theoverabundance of capacity continues to drive the marketthat we have been experiencing in 2015 and into 2016.The challenge that insurers will face as we look forwardis that the continued drawn-out downward pressure onrates across the property industry is creating an un-healthy market that is not sustainable over the long run.

How can commercial property insurers deliver value toretain profitable business in an environment of declin-ing rates? How can you truly differentiate?

In a market where rates are declining, it can betempting to seek the lowest price for coverage. But thereare significant differences among insurance providers.At Zurich, we differentiate our value through our ability

to give our customers insights to improve the resilienceof their organizations. We’re constantly working with cus-tomers to build that into the infrastructure of their organ-izations so that they can regain their footing quickly aftera loss. Zurich has more than 100 years of experience indelivering on our promises to customers in North Amer-ica, and as a leading global insurance group we can helpproperty owners manage their risks in more than 200countries and territories. Risk insight, claims expertise,global reach, financial strength -- these are just a few ofthe reasons why multinational corporations have chosenZurich as their risk partner for many years. We providevalue not just in the insurance policies we offer but alsothrough the insights we deliver.

How does Zurich help property customers build re-silience?

Our risk engineers are equipped to help customersharden their assets against a variety of perils. Zurich riskengineers work closely with customers to build businesscontinuity plans, and to take steps before, during andafter a loss. We bring not just a catastrophic perspectiveor a fire perspective but broad-based experience in miti-gating a broad spectrum of risks. Our teams gain insightsfrom working with customers in all industries, and we areable to share insights to help reduce property risks. Forexample, a company in the plastics industry acquired apeer with manufacturing processes somewhat differentfrom our customer’s operations. Zurich had experiencewith a loss on similar exposures faced by another cus-

tomer, and our engineer was able to share these insights.We showed the companies where they could build pro-tection into their processes. In another instance, we en-gaged with a large hospitality company to show them howto build in protection to prevent water intrusion, whichcauses most of the damage in hurricanes. From securingrooftop equipment with cables to sloping balconies to en-courage drainage to the proper glazing and support struc-ture of windows to resist projectiles and breakage, Zurichhelped this customer enhance its resilience. We haveshown our customers that it’s possible to retrofit buildingsbut generally much cheaper to incorporate the proper de-sign up front. Many of our large customers have used ourinsights to implement changes in the design phase.

How important is it for insurers to make investmentsthat help customers build resilience?

We want our customers to expect full engagementand attention from us. Zurich continues to invest heav-ily in our risk engineering group, to deliver insights andto ensure we’re keeping up with changes in buildingand industry standards. Our teams have been throughcatastrophe events many times, and we are able to ad-vise customers on what they need to do in the first hour,the first week and month etc. when a loss occurs.Zurich’s relationships with vendors enable us to helpcustomers plan for generators and fuel, for example.We are making investments to strengthen our ability tohelp our customers think about and plan for resilienceand recovery.

For more information about Zurich property solutions and risk insights,visit zurichna.com and the Zurich Virtual Literature Rack at zurichvlr.com.

CONTENTSOLUTIONS

Richard Montminy | Head of Property at Zurich Global Corporate in North America |

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Our risk engineers are equipped to help customersharden their assets against a variety of perils.