President's Report
Foundation makes most of donations to enhance, improve its projects

Are we having fun yet?  In my own businesses, I often ask that simple question because I think it is an essential element of success.  The work and success of the Foundation is no different.  We are having success and we are having fun.  Our fun may be defined a bit different from belly laughs but we are doing a great job with the limited resources we have and that equates to fun.  Whether it is a golf outing to raise funds or awarding scholarships to deserving college students pursuing an insurance-related education, we are putting smiles on people's faces including our own contributors.  Those smiles may even come from a regulator that finds out something about our industry and realizes we are part of the solution not the problem.  But let me review some of our success over the past year to give you a closer look.

Fundraising - We embarked on a capital raising campaign that focused on our London participants and encouraging past contributors to consider re-upping their finished pledges.  Our appeal to London started on a fast track in 2004 with a major contribution from the Council of Lloyd's.  We have had additional success from a number of the Lloyd's brokers and our appeal is continuing as we try to reach our goal of $5 million and we need to press on to complete this task.  

I want to digress to make sure everyone understands just how efficient the Board is in the operation of the Foundation's business.  The Board serves with no compensation and that includes travel expenses to the various meetings held during the year.  Administrative costs are kept to a minimum in order to allow us to devote our resources to our projects: Scholarships, Grants, the A.M. Best Annual Review of the Excess & Surplus Lines Industry, Associate in Surplus Lines Insurance designation program and Insurance Symposiums put on by two colleges.  The funds you contribute make it back to the purposes of the Foundation with extremely little spent on administration.

With that said, I want to encourage you to help us reach our fundraising target.  Included with this report is a pledge card that you can fill out and return to show us your support.  This industry has been very good to us and your reinvestment of some of your returns will go for a great cause and help further our recognition as a needed facet of the insurance business.

Scholarships - We awarded 12 scholarships to college students last fall.  These are students that are pursuing a degree with some tie to the insurance industry.  Many of these students have been or are NAPSLO Interns.  Quite a few of these students also were exposed to the surplus lines business through the Insurance Symposiums put on by Dr. Carol Jordan of Troy University and Dr. Michael Hubbel of Olivet College.  The symposiums are open to students from colleges other than the sponsoring school.  We are extremely proud of these students and wish them all well as they complete their studies and begin a possible career in the insurance industry.

Excess and Surplus Lines Annual Review - A.M. Best Company released the 12th annual review of the surplus lines industry at the NAPSLO convention last fall.  The report discusses issues relating to our industry as well as reviews the financial performance of surplus lines insurers.  The study has been financially supported by the Foundation since it was first published in 1994.  The report is sent to all NAPSLO members (whether they contribute to the Foundation or not), insurance departments and PCI members.  In addition, we supply the report for all the NAPSLO education schools and make the executive summary of the report available on the NAPSLO website.  This report has become the most widely recognized and quoted authority on the excess and surplus lines industry.

Grants and Programs -In  addition to the symposiums at Troy and Olivet, we are open to funding research grants that relate to the surplus lines industry.  We have reviewed several proposals and funded those that met our criteria for support.  We are looking into supporting additional college level symposiums in other areas around the country.  These programs have gone over extremely well with the participants and helped interest a lot of students in our segment of the industry.  

Associate in Surplus Lines Insurance- The designation program started 10 years ago has matured and is now going through an update of the two courses.  The text books are being rewritten and the exams tailored to electronic delivery by the Insurance Institute of America, with financial assistance from the Foundation.  We are proud to be approaching our 1,000th designation recipient.  The course work still requires four segments of insurance study, two of which relate specifically to surplus lines.  I want to thank Arthur Flitner from the IIA for his able assistance on the Board over the past several years.  

In review, I feel we have made some nice strides in the Foundation's work, and yes, we did indeed have some fun.  I recognize all of the other issues that presented themselves during the year and wish all those in the path of the hurricanes and other disasters a speedy recovery.  Hopefully, our industry has helped in that regard not only in providing coverage but making coverage available in the future as the market ebbs and flows with the changing economic tide.  The continued recognition of the need for the surplus lines industry, and in particular, the need to preserve freedom of rate and form, is in essence, the cause that the Foundation is committed to serve.  The Board of Directors has been tremendous over the past year in their support of these aims and I thank them all very much.

Respectfully submitted,

Joseph D. Timmons, CPCU, ASLI
President