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Q&A: Dominic Casserley, , Willis Group Holdings P.L.C.

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Q&A: Dominic Casserley, , Willis Group Holdings P.L.C.

Dominic Casserley took over as CEO of Willis Group Holdings P.L.C. in January, after a 29-year career in management consulting at McKinsey & Co. In an interview with Business Insurance Associate Editor Matt Dunning, he discussed his acclimation to the insurance industry and the company's growth strategy. Edited excerpts follow.

Q: What have you personally found to be the most surprising or challenging facet of the insurance industry's inner workings?

A: I think the most interesting challenge we've faced is prioritizing opportunities. We see significant interesting opportunities to serve our clients and thereby grow around the world. But the reality is that we can't do all of them. The second aspect of working in the brokerage space has been the large amount of mergers and acquisitions activity, at dizzying price numbers in some cases, which are sometimes a bit difficult to figure out how they work. You end up having to include a huge amount of leverage in order to make some of them work, particularly in North America.

Q: In what ways do you think the company's relationship with its producers, analysts and other personnel is changing?

A: Clients are demanding more data and more analytics, and also demanding teams of people from Willis, and that has some important indications for our staff. They've got to be more comfortable working in teams, they've got to be focused on building up their skills in new areas, and specialization around a particular industry or product area is becoming more and more the norm.

Q: Can the rate of growth Willis has seen in its human capital practice be sustained on a consistent basis once the health care reform law has been fully implemented?

A: An element of the growth in our human capital practice is the ongoing inflation and innovation in the health care space, independent of the health care reform act. We don't see any signs of that changing, and that creates ongoing health care cost management issues for employers. Secondly, if you look at the history of other major regulatory changes, there's a bit of a spike when they happen, but the change doesn't stop thereafter. The idea that the Patient Protection and Affordable Care Act is the last piece of legislation we're going to see in the U.S. is slightly unlikely. I think we're going to be fine tuning it and changing it for some time, and who knows how politics might factor into how all of that plays out.

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Q: How would you characterize Willis' appetite for acquisitive growth in the next one to two years, both domestically and internationally?

A: We look at opportunities globally. We're looking at companies that help us grow, where we see synergies with our company, and critically, where we see positive cash flow coming out of the deal. If we're going to pay some amount of money, we want to make sure we get more cash back out, and we'll be very disciplined about that. We're going to be targeting acquisitions that meet those criteria, but we don't necessarily have a domestic/international split. We're looking at how they'll fit globally within our company.

Q: What is the status of Willis' search for a carrier partner for its Global360 sidecar facility? What are some of the criteria you've set forth for evaluating potential partners?

A: The criteria are easy. It's imperative that whatever agreements we put forward are in our clients' best interest. We're looking at arrangements that can ultimately help our clients and that are sustainable. We're in advanced stages of discussions with multiple carriers from a range of different markets and geographies who've expressed strong interest in participating in this Global360 facility. Obviously, we're not in a position to comment on any specific arrangements or deals, but we are in advanced negotiations.