Climate and Insurance.org | takefive with David J. Teed

David J. Teed, CIC, is Executive Director of Business Development for the JLS Group, a New York City-based risk management consulting and insurance brokerage service that has been in business since 1909.

Prior to joining the JLS Group in May 2006, Mr. Teed was President and CEO of Vail and Sutton, a Poughkeepsie, New York insurance agency and brokerage.

Mr. Teed is a graduate of Hobart College. He, his wife and three children live in Hopewell Junction, New York. He has a CIC designation and is currently work on his CRM designation.

Takefive:
Mr. Teed, let’s begin by having you briefly explain how the JLS Group came to form its Live Asset Insurance program.

David Teed:
Live Asset was formed in June 2007 after I received a memo from an accounting source that stated “living landscaping” can be treated as an “asset” on a company’s balance sheet. This prompted me to ask how these assets were going to be insured. The search for the answer showed us that there were no viable insurance sources for this coverage in the marketplace, and therefore we saw a business opportunity for The JLS Group, Inc.

Takefive:
How were you able to overcome skeptical underwriters that live assets could be assigned values, and their conditions monitored?

David Teed:
Our research led us to HMI Horticultural Asset Management, who had a database of 750,000 plant material asset values along with five-year replacement cost projections for each plant. HMI engages an army of specialists across the country that support their plant values. The expert appraisers in each industry sector help determine their condition.

Takefive:
Can you explain the major provisions contained in a Live Asset policy?

David Teed:
The policy is a modified ISO named perils property form. The major provision is that our policy does not cover the fruit, nut, berry or spice grown on the tree, shrub, bush or vine. We like to think of it as insuring the life of the “golden goose” and not insuring the “golden eggs.”

Takefive:
What has been your company’s marketing strategy with respect to this product?

David Teed:
Our marketing strategy has been to create a website that answers most questions allowing us to drive people back to the site to electronically submit paperwork. The paid search ads as well as the search engine optimization strategies have been very cost effective. The best marketing is our national endorsement from the American Nursery and Landscape Association (ANLA) and a profile of Live Assets in Rough Notes.

We are working primarily through Brokers and Program Administrators that have direct access to the clients that need our coverage. Our marketing job is to “educate the educators” that this exciting new “Live Asset” product exists.

The states where we have seen the most activity so far are California, Texas and South Carolina. We are starting to roll out the national ANLA endorsement to the individual states and anticipate dramatic increases in participation shortly.

Takefive:
Finally, do you foresee insurers embracing other types of “green” product, like green roofs, in the future?

David Teed:
We can insure “green roofs” now. Our products will pay to remove debris, replace with like kind and quality, and finally reinstall trees on rooftops or where ever they are as long as they meet underwriting guidelines.

This product may be embraced by other insurers in time, but since we are open to all brokers and companies as a stand alone product, much like Hartford Steam Boiler, we do not anticipate heavy direct competition.

We are actively creating Live Asset Insurance products to position ourselves as the insurance leader for all plant material exposures. We are helping to facilitate global reforestation initiatives by creating insurance programs for tree planting operations where rain forests have been destroyed and are being replanted.

Insurance is the oil that lubricates the risk taking and innovation engines in society, and by doing our small part we hope to change the world, one insured tree at a time.