Rising Star Phil Huffman Sees Bright Future for Manufacturing Despite Some Clouds: Risk and Insurance | So Good News
US manufacturing could soon get a boost thanks to the CHIP Act. Marsh’s Phil Huffman shares the subsectors he’s most excited about and how he’s helping his clients steady their course through economic turmoil.
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Here’s a conversation with Phil Huffman, Senior Vice President and Growth Leader at Marsh and a 2022 Manufacturing Power Broker Finalist and Rising Star.
Risk and Insurance: What makes you want to make a living in brokerage? And how do you start manufacturing from there?
Phil Huffman: Like many people, I stumbled upon installments and insurance.
A good friend from school convinced Willis to pursue a career in manufacturing around 2013. At the time, I was considering a career change.
I wanted to get back into large account business development after running the management track in banking for three years. He introduced me to their new headquarters and I hit it off immediately. After a meeting and a discussion about my experience, These are the types of clients I’ve historically worked with and why they’re looking for a change. She made an offer and jumped at the chance.
As Willis and I began to make a name for ourselves in Pittsburgh, other brokers started calling. Marsh really stands out when it comes to learning more about the competitive landscape and how other brokers operate. That’s the model. P&C operating model; I decided to move easily with resources and depth of expertise.
I made this change back in 2015 and it’s been a really amazing ride since then.
more than anything else. Being here in western Pennsylvania, I found a unique opportunity in manufacturing. For the past 20 years, Western PA Northeast Ohio and West Virginia have moved away from the Rust Belt moniker that has always been associated with them. They are manufacturing hubs and their cores and manufacturing here is really a diversified sector.
I’m the companies that build 3D printers and everything else in between, value-added raw material manufacturers. We work with suppliers. These companies are tackling really complex problems and doing well while exploring new challenges in the market.
working collaboratively with their teams; Strategizing how we can help them innovate and grow and really taking intelligent risks is a really fun part of the job.
R&I: Are there any aspects of manufacturing that you are particularly excited about?
PH- Electric cars [EV] And as long as this market really evolves. I know there’s a lot of talk about hydrogen and other power sources, but I think the benefits of EVs are really exciting. There are many things to consider from a risk perspective.
construction of new factories; supply chain challenges; availability of raw materials; or battery transportation; storage and recycling considerations; A place where brokers have their work cut out for them.
Additive Production is another cool industry. It’s a sector that I’ve spent a lot of time on over the past four or five years. The impact of technology on the wider manufacturing sector is particularly light; It’s a really interesting thing right now from a tooling and prototyping perspective. I think we’ll continue to see more of that coming onto the shop floor.
I also work a lot with plastic. Now this is a really interesting subsection. You’re seeing corresponding pressures for these companies to close the cycle, especially around ESG initiatives and waste.
Finally, the semiconductor and chip space. It’s a topic given where we’ve come in the last few years and what we’ve seen in the automotive and other related industries. I think we will see an increase in expansion due to the pending intervention of the government in that sector. it is clear, You have big players; But I think there could be a lot of new competition there as well.
R&I: Many American manufacturers seem to be able to get funding through the Chips and Science Act. How do you see growth impacting your client’s insurance coverages?
PH- I think it’s mostly a “wait and see” scenario, so there’s still a lot to unpack there. Some major players have already announced significant capital investment in the US. We’ll definitely be seeing more of it.
Projects of that scope and scale will certainly bring new risks and insurance products for some of the companies undertaking these projects. We will likely see OCIPS and CCIPS and other different structures for these new builds and expansions. Guarantees may be tested due to supply chain and liquidity concerns. I know there’s been a lot of conversation recently in the construction of these new plants, where there’s a shortage of steel and other materials needed to actually build these plants.
with available funds; You will see many new market entrants. So when you think about legacy companies; Say there are 20 chip makers in the US right now, and another 20 are coming in the next few years. Could there be early quality issues? Could the recall market be tested along the way? Those are the coverages you can consider.
You also have a portion of these funds available through loans. If you look at what happened with the CARES Act during the height of the epidemic, After what happens now, there is a lot of scrutiny over how the funds are secured and ultimately used. We are now seeing a lot of lawsuits about misappropriation or misappropriation of these funds. Can you get it at some point and test out the D&O markets?
A big thrust of this bill is aimed at fighting another market: China. When they consider revitalizing or improving their business in an effort to improve ours. cyber security; intellectual property; Hidden conversations about trade secrets are also coming back into focus. We’re talking to technology companies and many of our manufacturing clients about protecting their intellectual property, so we’re seeing an uptick in the application of that set of coverage to organizations that may not have considered it before.
R&I– The World Trade Organization recently predicted that global trade will slow by 2023. On the installment side, What can you do to brace for the consequences of your customer shock?
PH- I think it’s really similar to some of the concerns that manufacturers have during the height of COVID.
More than anything else, the main topic we discussed with clients was liquidity and their ability to withstand the volatility that was coming. for example, In situations where the collateral is encumbered by cash or revolving credit facilities; Clients can work with their brokers to find alternative collateral structures that support their obligations.
In addition, Where do some of our multinational clients operate? Political risk and trade credits are two vehicles we should discuss; Ensuring that they are able to handle adverse events that may occur in the various locations where they operate.
In addition, Brokers should get closer to their clients’ decision-making teams at times like these to provide better insights into risk finance. Risk management strategies and related programs can’t stand still when you have increased volatility.
Above all else, we need information to flow. Not only in manufacturing, but in all industries. extent We see changes happening every day. Make sure our clients are aware of the work we’re doing—every tool involved. [our] toolbox — especially important when faced with new challenges.
R&I: What are the pillars of your brokerage philosophy? How you’ve supported your customers through economic turmoil.
PH- Being extremely open with clients and starting the planning process early are both extremely important. The markets have seen a lot of chaos in the past few years and at the end of the day our customers are the ones who feel the biggest impact. Making sure they have the time and data they need to process these hard truths and make tough decisions is paramount moving forward.
In a production and customer service I’m thinking of trying to be helpful even though I’m not a problem solver. Some of the more effective work I’ve done for clients has nothing to do with brokerage: maybe they need a lawyer for a special project, or they’re having problems with their bank and are looking for alternatives. Leveraging my network to help clients solve other problems has gone a long way in building trust and ensuring they are successful in their roles. This goes beyond insurance transactions.
A long time ago, a tycoon once said, “If you take care of people, everything else takes care of itself.” It’s something that sticks with me in every part of my career. Ask customers why they do what they do. It is very important for clients to understand how they are measured for success in these roles. If your efforts are consistent with those things, it’s really hard to go wrong. &