Commodity pricing a top exposure for energy firms
The ongoing drop in oil prices is putting new emphasis on risk management in the energy sector as insurers brace for potential market changes.
While exploration and production companies raced to open wells in recent years due to surging demand and advances that made extraction less expensive, many drilling companies have started idling their least profitable wells as a supply glut suppresses prices.
With crude prices dropping over 50% in the past six months to less than $50 a barrel, experts say the energy sector and insurers must re-examine longstanding assumptions.
Houston's construction industry is expected to grow almost 2.5 percent in the next five years, according to an industry observer.
Annual new construction spending in the Bayou City is expected to climb from $9.7 billion in 2012 to $14.2 billion in 2016, and will hover around $14 billion through 2019, according to Aon (NYSE: AON), a global insurance and risk management provider.
It seems like fracking is the buzz word when it comes to energy these days, but within the sector there are a plethora of coverages and exposures people may not realize exist. “Fracking that really is the word of the day it seems. Everyone is interested in it. There has been a huge uptick in the activity level in the on-shore US market,” said Bruce Jefferies, President of Aon natural resources. “It’s not just the East really, in fact frankly it is probably more so South Texas in the eagle ford shale area and also in the North Dakota Bakken region. Those areas along with the northeast where you have the Marcellus Shale, the activity levels are substantially above what it was say five years ago.”
The energy industry is not a risk for every underwriter; it requires considerable underwriting expertise due to its complexity and rapid growth. “Power is one of the fastest growing segments in the U.S,” according to Tom Fitzgerald, CEO of Aon Risk Solutions U.S. retail operations. “Between rapid expansion and growth, legislative, regulations and supply chain complexity, power and utility operators need a partner with an intimate understanding of the unique risks they face every day.” “It [the power industry] creates a very complex underwriting process that requires expertise specific to this industry,” said Mark Fishbaugh, the recently-appointed practice leader for Aon Risk Solutions’ national power practice group who shared his thoughts on underwriting the power in a recent podcast with Claims Journal.
The power industry requires a lot of underwriting expertise due to its unique risks and complex supply chain. According to Aon Risk Solutions’ CEO, the power industry is rapidly developing. “Power is one of the fastest growing segments in the U.S,” said Tom Fitzgerald, CEO of Aon Risk Solutions U.S. retail operations. “Between rapid expansion and growth, legislative regulations and supply chain complexity, power and utility operators need a partner with an intimate understanding of the unique risks they face every day.” Just this year, Aon Risk Solutions created a global committee to address the unique risks related to the power industry. During a podcast interview with Claims Journal, Mark Fishbaugh, the recently-appointed practice leader for Aon Risk Solutions’ national power practice group explained the different risks among coal, nuclear, gas and renewable energy and why the supply chain in the power industry is more complex than in other industries.
Aon Risk Solutions, the global risk management business of Aon, has strengthened its US financial services group leadership team with a number of appointments. Brian Wanat, who previously served as co-leader of the group, has been appointed as chief executive officer (CEO). He is joined by Christine Williams who will serve as chief operating officer. Anne Corona, in addition to leading the professional risk solutions group, will assume leadership of the US financial services group West region, overseeing Denver, Los Angeles, Dallas, Houston and San Francisco.
Let’s say you just finished with the renewal of your company’s insurance policies for the year, but you still have some nagging questions or doubts. Why did we buy these policies, and not some others? Did we buy enough? What do our peer companies do? Why did we end up with that limit or deductible? If you take the steps below, it should help you anticipate and answer the most important questions during the process of the renewal. As a result you should have a lot more confidence that you’ve made the best decisions for your company.
In your list of fun things to do each year, renewing your company’s property and casualty insurance programs is probably not near the top. However, all challenging projects are more enjoyable when we are properly prepared. Don’t we all wish we had worked out religiously for months before our next physical? Let’s rise to the occasion and do the work that needs to be done now so that we are better prepared when insurance renewal time comes.
HOUSTON — Few markets present the insurance industry with such a rapidly changing risk profile as the energy sector.
Aon plc (NYSE: AON), the leading global provider of risk management, insurance and reinsurance brokerage, and HR consulting and outsourcing services, today celebrates 48 brokers and consultants as winners of the prestigious Risk & Insurance Power Broker® designation. These brokers and consultants were chosen based on their dedication to clients and passion to excel.
Dec. 2, also known as Cyber Monday, is the biggest online shopping day of the year. This year, shopping totals are expected to top last year’s record-breaking totals by 15 percent.
Chad C. Jackson, staff director of risk management for FedEx Corp., dramatically restructured the company's aviation insurance program to address rising premiums by taking on a substantial self-insured retention.
With more than 200 insurance policies placed globally, Chad C. Jackson has devised and optimized a framework around FedEx Corp.'s insurance programs that has reduced costs.
Aon Risk Solutions, the global risk management business of Aon plc (NYSE: AON), today announced a bolstering of the Construction Services Group with several promotions and new team members. These personnel moves include Geoff Heekin as executive vice president of global construction, Michael Herrod as leader of the National Surety Practice, Phil Luecht as regional managing director for the West and Rodney Moss as regional managing director for the Southwest.
Aon Risk Solutions, the global risk management business of Aon plc (NYSE: AON), received three Oil & Gas Awards, recognizing its innovative products and philanthropic programs in the oil and gas sector. Aon earned the Corporate Social Responsibility Initiative of the Year award for the Rocky Mountain region on March 12 and was honored as Insurance Provider of the Year for the Northeast region on March 14 and the Gulf Coast region on March 20.
The Houston office of Aon Risk Solutions, the global risk managementbusiness of Aon plc (NYSE: AON), recently earned two honors, recognizing its human resource practices as well as rising stars.
(Reuters) - From water worries to well blowouts, the inherent risks of oil and gas extraction are often played down by those in the business. But another group of profit-seekers has every reason to keep a close eye on dangers for drillers: their insurers.
The power industry poses unique risks, according to Mark Fishbaugh, practice leader for Aon Risk Solutions’ national power practice group. He explains the different risks among coal, nuclear, gas and renewable energy and why the supply chain in the power industry is more complex than in other industries. He outlines top risks including an aging infrastructure, vegetation management and cyber terrorism.
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