All eyes are on Philadelphia this week as the Democratic National Committee officially nominates Hillary Clinton for president, just days after Republicans wound down their own convention in Cleveland for candidate Donald Trump.
If you were looking for the underwriters responsible for drafting the critical insurance policies covering these historic events, however, you would need to turn your attention to an office in Fort Wayne, Indiana.
K&K Insurance has been involved in the elections and political events space since 1988, when it insured the Democratic National Convention in Atlanta. The company also worked on the 1996 Republican National Convention in Houston, eight years later.
More commonly known for its presence in entertainment, sports and leisure, K&K’s involvement in the political scene was middling until 2012, when it insured both the Republican convention in Tampa and the Democrats’ event in Charlotte. That was also the year K&K underwriters first insured a presidential campaign, working for the Democratic ticket as it sought reelection to the White House.
“It was a bit of a baptism by fire,” said K&K senior underwriter Warren Mead, who worked on the campaign as well as both conventions. “We learned the lingo, worked with social events and soirées, and ended up doing the events surrounding the inauguration ceremony later in January.”
That set the company up for its heavy presence in the 2016 election season. The presidential race makes for high-profile business, Mead says, so campaign managers tend to seek out insurance professionals who understand the space. Candidates from both parties found K&K and, at its peak, the managing general underwriter was handling insurance for eight of the 17 Republican candidates and one Democrat through its special events program.
It was a busy primary season and now, Mead and another K&K underwriter are overseeing coverage for the final, successful Republican and Democratic nominees going into the homestretch. Part of that involves arranging insurance for the unofficial kickoff of the general election: the party conventions.
Much of the process is business as usual for K&K, which provides general liability, excess and auto policies for campaign events. Underwriters look at the size of the venues, arrange for key insurance certificates and manage coverage for rented and leased property. Other concerns, such as security, are addressed by the host cities – in this case, Cleveland and Philadelphia – which are given government grants used to purchase insurance.
That doesn’t mean insuring the events is necessarily straightforward, however.
“It’s as much an art as it a science,” Mead said of the process. “There are conventions every four years, and to some extent you know who is going to be there and how it’s going to be organized. But, because the events are so high-profile, I like to get as many people involved as possible – it’s always important to have one or two more sets of eyes on something like this.”
This year is particularly unique, with dynamic – and often divisive – personalities on both sides of the race. More than 10,000 people registered to protest during the Republican National Convention and ongoing debate over the DNC’s nomination process continues to plague the party well into its own event.
And though the potential for civil unrest is largely addressed through insurance obtained by the host cities, that kind of sentiment warrants attention in K&K’s underwriting process as well.
“This general election, I think, is going to be unlike anything we’ve seen before,” Mead said. “This time around, any candidate has the propensity to stir up the wrong kind of response in people, and you have to take that into consideration. Violence is a more prevalent concern for any event, and because the risk factor is so unknown and so hard to pin down, it causes a lot of [insurance] companies to start bowing out.”
In drafting coverage and providing risk management support under these pressures, Mead says the underwriters working on both the Republican and Democratic conventions compared notes on potential risk scenarios and worked to minimize any discrepancies in rating influenced by differing state regulations. K&K also sent an on-site loss control specialist to both conventions to provide support on the ground.
Yet the company also considers the “law of large numbers” in its approach to underwriting. While some unrest may occur, large events like conventions are often relatively peaceful. This was certainly the case in Cleveland, where the RNC wrapped up its event last week with just 18 arrests in the city.
K&K also has its history in entertainment underwriting on which to lean. In many ways, Mead says, the Republican and Democratic conventions are not unlike other major events – they take place in large venues, attract crowds and feature high-profile and celebrity speakers.
“We start off with a lot of event experience we can bring to the table, rather than having to build from the ground up,” he explained. “It makes sense to use these events as a springboard.”
Whatever happens as the Democratic National Convention concludes on Thursday, K&K still has more than three months – and many campaign events – ahead.
“The general election will just take off like a rocket and we’ll be right back into it,” Mead said, “from August 1 to the general election in November.”
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