Insurance Interview Paper

On November 8, 2017, I had the chance to interview a company about the insurance industry. I started doing some digging through companies that were respected in the industry, and I came upon a vast insurance company. The company happened to have a office located here in Birmingham, Alabama. This company I found is called Arthur J. Gallagher & Co., which is based in Itasca, Illinois and is the fourth largest Insurance broker in the world. I contacted Charles Johnston, the Area Vice President here in Birmingham, Alabama to interview so I could gain more of an insight on the industry. In the interview, I asked him questions that dealt with how the industry worked, an description of the positon, and the requirements.

Description of the Industry

Gallagher and the insurance industry as a whole. To explain in more detail, brokers sell policies to business owners and individual customers. Whereas your typical insurance agent represents one company, brokers work freely and most of the time represent more than just one company. Therefore, tolerates them to source vast options for coverage and prices to their prospective clientele. They also are required to be licensed in the state that they do business. In the interview, he said that brokers more opportunity to travel and require more face-to-face work. Whereas an underwriter looks for risk in policyholders the broker brings them. In more detail, they review the application they receive from the broker to decide if the prospect meets the requirements laid out by the company and how big the risk is so that the premium can be fine-tuned. Underwriters additionally look over the claims history of the policyholders to establish if they need to terminate their coverage over becoming an unprofitable risk. Johnston said, “underwrites are on the more technical side compared to brokers and normally do behind the scenes work.” The relationship between a broker and underwriter is close. That’s due to a broker mainly motivated to generate sales while an underwriter’s motivation is to guarantee cost-effectiveness. This led me then to ask Johnston about his typical workday. He said, “his day is usually busy with conference calls entailing risk assessment with different prospects the company handles and spend a lot of time outside the office consulting.” Later on, in the interview I asked how a broker and underwriter are compensated? He says, “underwriters are usually compensated on a salary, the majority of brokers are based on commissions from the premiums on the policies they sell. Also, that the median income for an underwriter was $65,000. For brokers the median