January February, 2004






By Barbara Coyner

Northwest logging contractors know the score when it comes to business liability insurance: it’s a real pain. Bill Pickell, Manager of the Washington Contract Loggers Association (WCLA), figures he’s got a prescription for that pain with WCLA’s new American Forest Casualty Company RRG. The newly formed Risk Retention Group (RRG) offers million-dollar liability policies and umbrella plans to contractors primarily in Washington, Oregon and Idaho, with services also available in Alaska and Montana. “No other association is doing what we’re doing,” says Pickell, president of the new company. “We’re the new kid on the block, and we offer pride and ownership with a potential return and lower premiums. We really assess our risk and know our own loggers well.”

Pickell, previously a logger and forester, was elected President of WCLA from 1983 to 1985, and got a crash course in insurance issues when he switched horses to become the Manager of WCLA in 1990. He can recite the ins and outs of taking the group from a 480-mem-ber, low-budget operation to a 1000member $2.5 million mover and shaker by 2003. Thanks to a seasoned insurance manager, WCLA moved first into a retro plan (when the premium exceeds the payout, the plan returns money to its group), which kept the loss ratios down.

Always fine-tuning, the association later worked with a rent-a-captive company in Bermuda, hiring the offshore insurer to front services. When the Bermuda outfit announced its intent to drop services to WCLA, management had to hustle. The association decided to operate off a 1986 Congressional Law authorizing the RRG for groups having a tough time finding their own liability insurance, and opted to domicile in South Carolina. “We started in April 2003 and had just a short period to set it up,” Pickell says. “Usually you have 18 months to form a company, hire a lawyer, get your underwriters and set up claims staff.

The rent-a-captive extended coverage through September 1, but we had just three weeks to they’d license us.” With $5 million tied up in the Bermuda company, WCLA put out the word to contractors, promising a 6 percent return on preferred stock issued by the new holding compa ny. In a complicated set of moves, the RRG came down to the wire with appropriate monies in hand and a good plan to offer.

Pickell says it’s a $6 million pro gram just in liability, with almost $9 million for all lines. The idea is to move from non-profit to for-profit status, with a goal of $20 to $25 million in ten years, and a chance to go public if members vote to do so. “Loggers have a heck of a time getting coverage, but Northwest loggers are regarded as more professional, considering their historically low losses,” he says. “We’re going to try to work through state associations and make some offers to give a share of the commissions if they promote this. So far, we’ve been selling through individual mailings and have had a good response.”

Pickell notes that liability insurance is offered through other companies, and WCLA doesn’t intend to horn in on small-town brokers now serving clients. The new company, however, will furnish free quotes to contractors, conduct rigorous safety inspections to minimize risk, and work with reliable re-insuring companies, all in an effort to stay efficient and competitive. “Our members are proud and since joining the agency in 1985, I’ve seen a strong loyalty. We’ve made a profit since day one on this, but we’re not out to screw loggers to do it. We want to keep costs low, but on the other hand, there is a risk.”

The Olympia-based WCLA can be reached at 1-800-422-0074 or contacted on the Web at www.loggers.com . There is also a satellite office in Coeur d’Alene.


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This page was last updated on Tuesday, September 28, 2004