Kevin Ingram, CFO, FM Global

Great, thanks Jack. First of all, thank you for having me on today, I really appreciate it. I grew up in Illinois, went to school in DeKalb, Illinois at Northern Illinois University. I got my accounting degree, went to work in public accounting as most people do. I worked at Ernst & Winnie, I'll date myself, I'm an old guy, it was Ernst & Winnie when I was there. I was there when the merger happened between Ernst & Winnie and Arthur Young. I was there for a little over six years and left to work for my clients. I went to work for a client, a commercial property insurance company based in Park Ridge, Illinois. They merged with two other insurance companies in 1999, so I moved from Illinois to Rhode Island. I spent about the next 10 years in Rhode Island in a variety of finance roles. In January 2010, I moved to London, to Windsor where the Queen's castle is, as finance director for our non-US, non-North American businesses, about 800 million pounds of revenue in that UK company. Worked there for five years, left in mid to late 2014, moved back to Johnston, Rhode Island. I left finance and went into corporate services, which gave me responsibility for capital management, business process improvement, and a group of business risk consultants. I was the Senior VP of Corporate Services. Our CEO told me, 'It's great because Corporate Services means absolutely nothing to anybody, so if I want to move something into your area, I can do it, nobody can tell me it doesn't belong.' So I did that for about two and a half years. Then our CFO retired, I talked to the CEO, and I became CFO in the fall of 2016. So now I'm the Senior Executive Vice President and CFO of FM Global, just enjoying the ride.

Yes, I was. The first job I had, and I did that for a long time. I worked at a small independent grocery store where I grew up in Aurora, Illinois. I worked there from eighth grade through university until I got an internship. I did everything except work in the meat department: stocking shelves, cash registers, produce, deli. It was fun. I think when you start working young you learn responsibility, being on time. I hate being late for anything. My wife and I have been married 35 years if we're going somewhere that I've organized, when I say it's time to leave at three o'clock, really at three o'clock. If it's something she organized, I'll sit on the couch watching the ball game and when she's ready, let me know. If the thing started at four and we leave at five, that's okay because it's your thing, not mine. It's pretty funny.

Yeah, we came back. We opened our corporate office on October 4th. We made it a soft opening, told people to work with their managers to see what makes sense. My view was we need to get people back in the office. Our plan is three days a week in the office and two days working virtually. We spent the last 18-plus months working virtually, it's been very effective, the company has done incredibly well, but you lose so much by not being together: mentoring, impromptu meetings, problem solving, collaboration. There's nothing impromptu in a virtual environment. So we're guardedly optimistic. The first Monday we had 210 people in a building that holds just under 1,000, so it's going the right way. This is a big issue companies will face.

You're absolutely right. We've seen that too. A lot of millennials and new hires over the last 18 months haven't had the opportunity for collaboration, and now they'll come into the office. The concern is they may be behind the eight ball because they missed fundamental development.

FM Global is a commercial property insurance company. All we insure is large commercial property. We're global, formed in 1835. We specialize in loss prevention and engineering services, helping clients avoid losses. We have a research facility in Rhode Island where we study wind, flood, earthquake, fire, explosion. We have about 7 billion dollars of global written premium, 19 billion dollars of capital. We're a mutual insurance company owned by policyholders, which helps us withstand the volatility of property losses. For example, in 2017 with Harvey, Irma, Maria, we had big underwriting losses, but as a mutual we can weather that.

Climate change is real and will impact facilities. First, understand your risk: flood, wildfire, how it's changed due to climate change. Then, what can you do to mitigate? For example, if a flood could shut you down for six months, what investments can reduce that to two days? Prioritize risk improvement because no one has unlimited money. As a CFO, I understand that. So help clients prioritize their spend for the most benefit.

Yes, 9/11 opened everyone's eyes to terrorism. Before, it was excluded from most property forms. After, terrorism is underwritten differently, with government backstops like TRIa. Now people look at truck bombs, Oklahoma City style. Also cyber is a big exposure: could people get into controls of turbines or power grids? Cyber is causing big issues in commercial property. So it's about understanding exposure and what you can do to mitigate.

First, we realized the pandemic impacted all our employees. We said employees are our most valuable asset. We wanted them and their families safe. But we still had a business to run. Next, we ensured people had the technology to work virtually. The pandemic gave us a real live business continuity test. But it created new exposures: more remote access means more cyber risk. Also, we lost the benefits of being in the office. Our company was very successful, but we need to get some of that back. The business model has changed; we'll have a hybrid. But people realize the commute is wasted time, but they chose to live where they live. It's about balancing.

I think you need to understand your business. The more time I spend with policyholders and operations people, the better. Those operational roles helped me understand real problems, so as CFO I can help prioritize what to spend money on. The world is changing with digitalization and social engineering. You have to invest, but understand the benefits and paybacks to prioritize. You can't do everything, so understanding customer pain points helps in prioritization.

Look, when I talk to my risk manager, it opens my eyes to new things. Right now, cyber is a big thing: what cyber insurance coverage are you buying? Understand your total risk exposure, not just commercial property. As a CFO, you need to understand all exposures that could significantly impact your organization and what steps you take to mitigate them. Invest over time. I care about what's best for FM Global and ensuring we're in a strong place 5-10 years down the road. I'm 59, will retire in 5-6 years, so I want to set the organization up for success.

Thanks Jack, it's www.fmglobal.com.

Thanks Jack, I appreciate it. I'm happy to answer any questions if anyone does have anything, so just let me know. Appreciate your time. Thanks for the invite. Thanks, have a good one.