TT:
AON fills energy insurance void
By Sandra Chouthi
The Trinidad Guardian
Port
Spain
Petroleumworldtt.com
10 29 06
What
growth potential can AON, a Fortune 500 company
with annual revenues of US$10 billion, possibly
see in T&T?
AON
Energy Caribbean Ltd’s official information
eight-page catalogue notes T&T’s $108
billion in GDP and a major economic power within
the Caribbean.
“Looking
to the future, AON believes that Trinidad will play
an increasingly important role as a supplier of
energy to the US as well as to other countries,”
the booklet read.
That
said, AON is here for the long haul, said Houston-based
Trevor Montoute, vice-president of AON Risk Services
(Holdings) of the Americas, Inc.
Speaking
from a numbers and an income point of view, Trinidad-born
Montoute said AON does not need this country. But
income is not the only reason why AON, which Fortune
500 has ranked at 237, has positioned itself at
33 St Clair Avenue.
“You
have a lot of LNG. You have a lot of methanol, ammonia.
You have a lot of plants here. What it means is
that you have a lot of skilled people,” Montoute
said. “What it means is you have a lot of
people here who would require a lot of services
which cannot be provided by local companies.”
“This
is not just about placing insurance. We are a consulting
business. A big area of our business, which is lacking
in this country, lacking from the insurance side,
is loss control or risk control.
“How
you manage risk and mitigate it and how you deal
with it within these petrochemical plants as against
a building is different.”
He
said AON relying on a local associate/broker to
service a Trinidad-based international petrochemical
firm efficiently is risky.
He
added that if an associate company in T&T makes
a mistake with a foreign company’s account,
AON could lose its business.
“That’s
one example of why Trinidad would become so important
to us once we have very large clients operating
here. We have to be here, whether we still use the
local associate or not,” he said.
He
said even though AON Energy doesn’t handle
the whole account, the intent is to have an operation
in Trinidad to handle a client’s affairs.
“We
are not a transactional broker where we are looking
for a placement, where we’re looking for some
commissions. This is a long-term relationship.”
AON,
insurance broker and risk consultant headquartered
in Chicago, was registered in June 2005 and received
its brokerage licence in December 2005.
Citing
absolute confidentiality as key to its operations,
Montoute and managing director Lou-Anna Ferreira-Patterson
said they could not even name their five petrochemical
clients, much less state how much premium income
they have generated from them.
“We’ve
been trying to determine, and we don’t have
very accurate figures what the total premium income
is for energy business in Trinidad,” Ferreira-Patterson
said.
They
said when AON, which has a 40 per cent shareholding
in Agostini Insurance Brokers, first entered the
T&T market, local brokers feared it would “come
in and take all the business and leave.”
That’s
not the case, Ferreira-Patterson said. “The
thing is, it’s open competition.”
More
than that, providing insurance for the petrochemical
sector is highly specialised.
“So
you have a small number of insurance companies which
provide coverage for companies that fall within
an energy/petrochemical sector,” she said.
“It’s very limited. Nobody outside of
that small group can provide insurance for that
sector.”
Sadly,
local insurers are unable to write energy business,
said Patterson-Ferreira, who worked for Consolidated
Insurance Company for 14 years.
“I
think they have seen the potential. And I know some
of them have tried to get a piece of the action,”
she said.
“There
are many who would like to. The Maritimes, the Tatils.
Beacon is trying to do something right now. So a
lot of insurance companies would love to participate.”
Of
AON’s partnership with Agostini, Montoute
said it was decided that while the local broker
is important to its entire network, AON decided
to specialise and underwrite the energy side of
business.
Patterson-Ferreira
said local insurers do not have the expertise and
the reinsurance treaties to support writing energy
business.
AON
advises energy clients on what types of insurance
they need before going on the reinsurance market
for a company to take their risks.
“The
local companies cannot take it. We have to go outside.
We go to the US market, the traditional energy market,
the UK market.”
“Basically,
AON has our energy hubs of major divisions are in
the US—Houston and London,” said Ferreira-Patterson,
who is listed on AON’s information sheet as
being the only Trinidadian who could attest to having
acted as insurance broker and risk management consultant
to every local methanol plant.
The Trinidad Guardian
Thursday 26th October 2006
Copyright
©2006 Trinidad Guardian. All Rights Reserved.
