As a youngster listening to my Grandfather teach the magic of compounding interest, studying Value Line Publishing reports with my Father, or fireside chats with both wonderful mentors discussing equity opportunities, I grew up in a special atmosphere for which I am so humbly grateful as it rooted in me an extraordinary understanding of the financial world and all its intrigue.
At 12 years old, my father joined a little known, at the time, company called Berkshire Hathaway as a divisional President. What a special factor in my life as my Father had me reading all the annual reports and various publications from and on Warren Buffett and Charlie Munger. Off to college, I attended University of Nebraska and studied under the wonderful Dr. George Rejda (“Principles of Risk Management & Insurance” now in its 12th Edition and used widely amongst many colleges and universities), interned for Merrill Lynch, and then had my eyes opened to the interesting world of casualty risk through Dr. Rejda, an underwriting internship and Berkshire’s reinsurance activities. Wausau Insurance recruited me after college to learn the underwriting ropes.
Upon taking the jump from underwriting into insurance brokerage, my father called me one day to ask that I secure for him appropriate Professional Liability (E&O) insurance for his newly formed RIA; begun after his years at Berkshire and Calumet Industries. Appropriate insurance means containing language that properly meets/matches the exposures and does so for an acceptable budget.
I then learned, through the amazing and gracious mentoring of Bud (President) and Nancy Bigelow (Chief Underwriter) of Cambridge Alliance, which became the largest national underwriter of Investment Advisors (later purchased by Markel), that there was a significant difference between various E&O insurance contracts, unlike standard property/casualty language which is commoditized for business lines such as Auto, General Liability and Property. I learned that in the RIA world, the Insurance Services Office has decided to forego a recommended industry form (such as they do for all other lines); every underwriter, therefore, issues their own unique form with multiple differences to the insuring agreement, defense allocation, definitions, exclusions, conditions, etc. I clearly saw that this was to be an educational process that must be treated carefully to insure my Father correctly. After all – it’s my Dad! P.E. Golsan & Co. became our very first RIA customer and our first Cambridge Alliance (now Markel Cambridge Alliance) customer. Now, as of 2016, Golsan Scruggs is Markel Cambridge Alliance’s largest RIA national broker and the Western Referred Agent to the program that encompasses almost 3,000 advisory firms (2016).
What does this past history confirm for an IA seeking to find the “best fit” for their E&O representation? History confirms there are two critical components an IA should demand from their insurance broker; Superior Knowledge (compared to average) of: (1) the investment world – what and who an IA is and does – knowledge of the 1940 Act and all its implications, and (2) the multiple contractual differences (ever-changing) among the key E&O insurance markets. Investment and Insurance knowledge such that an IA’s risks are properly secured.
Since P.E. Golsan & Co., each and every client who has retained Golsan Scruggs is considered part of the Golsan Scruggs family. Just as I served my Dad, it is with our upmost that the same care and attention to detail shown is equally applied by our entire team to all customers – big, small or otherwise.
Thank you for the confidence you have placed in Golsan Scruggs to protect your fiduciary interests. It is an honor and a privilege to be of service and call you part of the family.