By Les Cunningham CGC, CR*, CCR*, CGRa businessnetworks *A NARI Certification

1. The Myth of 10 and 10- Developing a Win/Win for Insurance Companies & ContractorsWin-Win-Win or No Deal By Les Cunningham CGC, CR*, CCR*, CGRa http://www.businessnetworks.com *A NARI Certification

2. Basis of my information: It will offer you a different perspective thatmay lead to significant results for you personally and corporately. • Business Networks200+ companies • a. Hands-on review of their numbers • b. Participation in all the major associations • c. One-on-One consulting • d. Owned and operated my own business for 15 years • e. Won 15 C.O.T.Y. awards in a 7 year period

3. Financial Reality: With Financial Pressures on the Insurance Companies and the Restoration Contractor, it must beWIN-WIN-WIN or NO DEAL!

4. WIN-WIN-WIN or NO DEAL! (Insurer-Contractor-Policy Holder) Actually, for the Insurer and Contractor to succeed, it needs to be: Win (Insurer)… Win (Contractor) … Win (Policy Holder)

5. The Insurance Marketplace is a War in Progress. Mergers & Acquisitions Cost sensitivity over the past 8 years, resulting in reduced quality of service to the insured. Direct Writers (Internet, Banks) Competitive marketplace – everyone’s positioning themselves.

6. What do the Insurance Companies Need to “Win”? • Great Service from the Contractor (Absolutely!) • Happy Policy Holders (Yes!) • Rock-bottom prices from the Contractor (Really?)

7. What does it cost the Insurer to meet Policy Holder’s Expectations? • Knowledgeable Staff (training – lots of turnover) • Lack of Knowledge costs money (when a simple water damage turns into a major mold problem) – this in turn affects costs for the insurer and their ability to be competitive. • Professional Contractor Resources • 24 / 7 Emergency Response(Internal call center or outsourced)

8. It Hurts the Insurer to Lose Policy Holders… • Loss of Policy Revenue • High Turnover of Policy Holders increases the marketing and administration expenses in order to obtain, set up and cancel the Insured.

9. What do Policy Holders Need for their “Win”? • Coverage as Per Policy • Immediate Response • A Competent Professional Contractor • Life Back to Normal, ASAP • Constant Communication (i.e. a sense of control)

10. Why Do Policy Holders Leavethe Insured? • Price (Coverage costs too much.) • Poor Service on a Claim (Not meeting customer expectations.)

11. What does the ContractorNeed to “Win”? • A Reliable and Regular Source of Work. • Clear Communication from the Insurer. • Insurers who pay“Timely” & “Fair Prices.”

12. What Does It Cost the Contractor to Meet Customer Expectations? • 24/7 Immediate Response • Infrastructure to Manage this (Overhead). • Training Costs – Ongoing • Technical & Customer Relations • Risks of Not Training • Being sued for not following published standards (ASCR & IICRC). • Fines for not following Ministry of Labour Occupational Health & Safety regulations. A knowledgeable contractor will save the insurance company money.

13. The “10 & 10” Myth The Restoration Contractor can prosper (survive) on 10% overhead and 10% net profit. Doesn’t Work. Let me show you…

14. See For Yourself: Overhead Net Profit Mythical Company $5-Million, 10 & 10 10.0% 10.0% Real Companies (35) withwith avg. of $1.5 Million 32.4% 2.0% Real Companies (30) withwith avg. of $4.8 Million 25.5% 7.8% Allstate, 2000 Revenue of $29.1 Billion 22.3% 10.5% State Farm, 2000 Revenue of $29.6 Billion 18.0% 7.0% 14:18

15. 10 & 10 Analysis (Source Data): Does Volume Make a Difference? 15:18

16. Conclusion: Win-Win-Win or No Deal • Quality services retain Policy Holders for the Insured. • Knowledge & Training saves money for everyone. • The contractor needs fair pricing in order to provide knowledgeable and quality services. 

17. Questions? ? ? ? ? ? ? ?

18. Thank You! From the Business Networks Team for the opportunity to be of service to you and your company!!