Top View: John Mina, Risk Strategies

John Mina joined the insurance industry as a broker in 1986 and spent much of his career at Willis Towers Watson PLC and predecessor companies before joining Boston-based brokerage Risk Strategies Co. as president in 2017. He was named CEO in 2019. Risk Strategies, which celebrated its 25th anniversary this year, has grown rapidly since private equity firm Kohlberg & Co. invested in the brokerage in 2013. The brokerage has made 135 acquisitions over the past 12 years and is ranked 16th on Business Insurance’s Top 100 U.S. Business Brokers with nearly $1 billion in revenue. Mr Mina recently spoke to Business Insurance editor Gavin Souter about the future of risk strategies and how to navigate the insurance market. Edited excerpts follow.

Q: Risk strategies have been built over the last 25 years. What is your vision for the next 10 years?

A: In the long term, I would like to see Risk Strategies become a top five global broker. I think it will take more than 10 years, but if we’re going to start with long-term aspirations, that’s where I’d put my goal. My experience is international and I think that is an important aspect or element of being a realtor.

For the next 10, I think risk strategies will evolve in several ways. We will continue to invest in technology to represent how tomorrow’s customers want to be served. We’re all starting to see this shift in shopping habits where shoppers are increasingly tech-native. In the same 10 years, we will continue to develop within our specialist practices and go even deeper and provide more industry and product expertise to clients. And we’ll probably expand into a few new industry verticals where we don’t do much business right now, and we’ll probably do that through strategic acquisitions.

Q: Any specific one verticals in the mind?

A: Infrastructure, agriculture, technology and energy are probably the top four right now. There are a few others, but I think they all have a long-term need in the United States.

Q: And you mentioned international. Do you see international growth as well?

A: I do it. Our typical approach to expanding into a new vertical or geography is to first find the right partner and use that as a cornerstone to build from. We’re not going to be in a rush, we have a lot of opportunities here in the United States, but we’re probably going to go into international waters for sure within that 10-year period.

Q: You mentioned growing into a top five broker. It will probably require some pretty big acquisitions.

A: Yes, and if I look at the consolidation that’s going on in the industry, it’s not likely to end anytime soon. If we look at history and what happened in the 1990s, at some point comes the consolidation of the consolidators. So the number where we are right now at 16 to the top five could lead to consolidation of some players in that space or even ourselves.

Q: conditions change like rising interest rates affecting the price of brokerage M&A?

A: I think interest rates will eventually cool the market a bit, especially if they start to move up into the upper single digits, but they don’t seem to be having much of an effect to date. The odds are as high as they’ve ever been, and right now I don’t see any trend to show that they’re going down.

Q: Commercial insurance market rates have been rising for the past four or five years. Do you think we’re starting to move into the next phase of the pricing cycle?

A: If the next phase means significant reductions or a sustained soft market, I don’t think we’re there yet. Prices are not increasing at the same rate we have seen over the past few years. They are certainly getting tougher and there are some discounts for some customers.

Some lines of business, such as cyber, homeowners and catastrophic properties, continue to be under stress. Interestingly, I don’t see it as a capacity constraint, as insurers are more carefully trying to determine exactly what the underlying risk is and then how to properly insure it. But I’d say it’s slowing down; not yet in reverse.

Q: With that in mind, what advice would you give commercial policyholders to help them navigate the market?

A: I would make three recommendations. Clients need to make a real assessment of how much risk they can take as a business, and I don’t see that being done very often. If you are confident in your exposure and your ability to mitigate your risks, this is a good place to start when considering franchises, for example. Too often I see clients simply renew at expiration and fail to consider whether their risk tolerance or approach to risk mitigation has changed.

Second, I’d say that when you’re fighting for the best price with limited capacity, feed quality is absolutely critical. It’s a lot of work to put together a good story for insurers that correctly assesses risk, but glossing over the details only adds uncertainty, and that comes with price increases, capacity cuts, or both. So partnering with your broker to build the best and most accurate picture of your risk possible is critical. And with that, market it early; time is not running out.

And the last thing I would say and I would be remiss if I didn’t say that choosing a broker and getting a good market guide is critical. Less efficient is having multiple brokers shopping the same risks and muddying the waters trying to find the best price.

I have met very few insurers who have the time to compare quotes from different insurers, much less multiple brokers, and even fewer have the ability to drill down into the details that can really matter when comparing these options.

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