Capabilities Brochure

1. USI Southwest
Broker Services Capabilities Summary
Complex Risks in Real Estate,
Development and Construction.

2. About USI
Market Leader
USI is a portfolio company of
Goldman Sachs Capital Partners, Employee
Benefits
a private equity affiliate of Goldman Sachs & Co. Property and 34%
Casualty
57% USI
National Presence / Local Expertise Workplace
USI has 71 offices in 19 states and 9%
approximately 3,500 business professionals
serving over 60,000 business clients.
Broad Product Resource and Distribution Capability
USI provides property, casualty, health & welfare products and financial services in
5 broad categories with over 20 products and services.
Geographical
Geographic
Diversity
Broker Services Risk Management Services
Property / Casualty Risk Control
Health / Welfare
Employee Benefits Risk Financing / Alternative Risk
Wealth Management
Alternative Risk Claim Advocacy
Pension / Risk
Executive Retirement Information Services
USI Workplace
Environmental Mitigation Actuarial Analysis
Worldwide Market Access Data Collection & Reporting

3. USI Southwest Real Estate Practice
USI Southwest is a full service insurance brokerage and risk management consulting firm
focused on the needs of the real estate industry.
Our goal is to redefine the role of the insurance broker in real estate financial transactions. We
believe that by developing long-term, strategic relationships with real estate firms and their
advisors, we can improve the efficiency, structure and investment returns on real estate
transactions.
We also believe that as a privately held, strategically focused brokerage, we have the flexibility
and the speed to react more creatively to deal-specific hurdles and the special needs of real
estate companies. Our smaller size does not, however, equate to inexperience: our professionals
have over 10,000 transactions to their credit.
Our combination of industry experience and responsiveness results in meticulous due diligence,
creative and cost-effective insurance solutions, and the development of unique product and
financing alternatives.
USI Southwest is based in Houston, with offices in Dallas, Austin, Albuquerque, and New
Orleans. USI is a portfolio company of Goldman Sachs Capital Partners, a private equity affiliate
of Goldman Sachs & Co.
Due Diligence
USI Southwest does not just sell insurance. We are engaged by real estate firms to analyze
business risk, assess risk management practices, interpret coverage adequacy, and design cost
effective solutions. How can your agent or broker sell you insurance if they do not take the time to
understand your business?
USI Southwest applies its unique due diligence perspective to traditional buyers of insurance.
Does your broker/agent provide you with a Risk Analysis Report highlighting the business risks,
operational risks, and financial risk of your business? Do they analyze historical exposures?
Identify future exposures? Discuss current trends? Anybody with a broker's license can sell you
insurance. USI Southwest helps you manage risk.

4. Business Risks
Business risks are inherent to most activities undertaken by a company. Many of the risks
associated with conducting business are not insurable, such as the risk of a new competitor
emerging or that of a company's products becoming obsolete. However, there exists a large body
of exposures, particularly those arising from direct or indirect relationships between a company
and other parties, which do have insurance implications:
• Legal/Contractual Obligations
Service commitments
Indemnifications provided (and received)
Product delivery, performance, and reliability standards
Employment contracts
Equipment and real estate leases
• Strategic and Financing Initiatives
Mergers and acquisitions
Joint ventures
Partnerships
Public and private debt and equity issues/placements
• Supply Chain Management
Vendors
Suppliers
Resellers/Retailers
Contingent business interruption exposures
Operational Risks
Operational risks are defined as those risks associated with the day-to-day operations of a
business enterprise. As one would expect, operational risks are dependent on the operations of
the organization. Operational risks for real estate companies are different than those of
manufacturing or technology firms.
Operational risks are the most easily transferred risks to third parties. The pricing of the risk
transfer is the most uniform.
• Coverage associated with operational risks include:
Workers' compensation

5. Business interruption
Property
Liability
USI Southwest is uniquely qualified to assess operational risk. We have extensive experience in
the real estate industry and the corresponding operational risks.
Financial Risks
There are numerous financial risks associated with the management of any business. Like any
other exposure to loss, certain financial risks are insurable and certain financial risks are
uninsurable. Unlike business and operational risks, where the line of insurable vs. uninsurable is
clear, the insurability of financial risks are a "moving target".
Traditional financial risks are classified as those risks associated with the financing for and
financial management of a business. Including:
• Interest rate risk
• Foreign currency risk
• Credit risk (from customers)
• Credit risk (to suppliers)
Non-traditional financial risks are classified as those risks not associated with the financing of a
business but, rather, those risks that have a direct financial impact on the business and are not
otherwise classified as business or operational risks. Including:
• Risks from shareholder litigation
• Risks from third party (non-product related) litigation
• Risks associated with political instability (confiscation, contract disruption, war)
• Risks from regulators and other governmental agencies
• Risks associated with mergers/acquisitions/divestitures
USI Southwest has devised unique risk transfer and risk sharing alternatives for clients with
exposures in these areas.
Geographic Reach
USI Southwest is licensed in all 50 states. We have clients in all of them. We work in key foreign
countries and we do not cede control of your account to a "correspondent firm".

6. Transparency
We are your partner. We act like one. We disclose our compensation. We disclose our insurance
company relationships. We certify all of our proposals for accuracy and disclosure. Is there any
other way for a partner to act?
Resources
Most small brokers/agents have limited resources. Most large brokers save resources for their
Fortune 500 clients. What about the rest of you? USI Southwest has developed a comprehensive
set of specialized resources. We will do whatever it takes to bring the best resources to bear for
our clients — regardless of the economic impact to us.
Customer Service
Some things never go out of style; like having an Account Executive that actually acts like an
Account Executive and not a concierge. Our Account Executives service their clients. They do not
redirect your phone calls to the appropriate department. They ARE the appropriate department.
When you need outside, specialized resources, our Account Executives coordinate them and
remain your single point of contact. They know your claims history. They know your safety issues.
They know your short-term needs and long-term dreams. Service like that is always in style.
Select Client List Select Client List
Upon Request

7. The USI Advantage
We match great people with a great process.
You get strong, consistent results.
Process
Most brokers have inferior processes or no process at all. USI Southwest has
developed a patented process that is:
• Individually Tailored to meet your needs
• Measurable so we know if we are performing
• Accountable to you
• Aligned with your goals and objectives
• Proactive, not reactive
People
Small brokers/agents have limited resources. Large brokers save resources for their
Fortune 500 clients. USI Southwest has developed a comprehensive set of specialized
resources and expertise to meet the needs of the upper middle market.
• Industry Specific Risk Management
• Executive Protection
• Environmental Risk Mitigation
• Advanced Claims Advocacy
• Loss Control
• Health/Welfare

8. Real Estate Portfolio Management
Property coverage for complex and high-value asset portfolios requires significant market
knowledge and structuring capability. USI uses our Risk Management principles to properly
assess the risk profile of such asset driven accounts, with the intent to provide each client with
the information necessary to make a decision about their level of risk retention, risk funding
methodology, and allocation strategy.
This process includes actuarial based analysis of historical property losses, payments under
deductible and retention limits, and assignment of loss values to each property in the portfolio. By
understanding prior outcomes, we can then allocate premium and loss costs for proper billing and
budgeting.
In some cases, the client may wish to take a high
retention under a master policy, fund the
retention, and charge out the premium to each
property based on a risk allocation model. In
such a case, the premium is driven down by
increasing retention to a level actuarially out of
the money for non-catastrophic losses. The self-
funding of the retention is then spread across the
portfolio in an equitable fashion.
USI drives this process by completing the historical analysis, and placing the coverage in markets
that understand such structures. In some cases, foreign markets and third-party wholesale
brokers participate by assisting us in covering the worldwide market to the benefit of our clients.
Understanding the current difficulties of wind exposure coverage in first tier counties along the
Gulf and Atlantic coasts is an important part of structuring retentions. USI leverages the non-
coastal portions of the portfolio in the marketplace to improve the overall pricing profile of the
program.
In some circumstances property owners hire third-party management firms to operate and
manage their properties. In such cases, the management firm can allocate costs for insurance
and losses under a contractual agreement. Third-party loss and premium data can be
incorporated into USI’s loss analysis in such a way to determine if allocations are representative
of actual experience of the property being charged. It can be benchmarked to further assure cost
controls under contractual arrangements.

9. Construction Practice
The USI Southwest Construction team has the intellectual capital and market access to assist
general contractors, construction professionals, project financiers and developers of every size to
create strategic risk management solutions.
We anticipate trends and issues in the construction industry and develop strategies for our clients
to improve risk profiles, lower cost and add profit through customized risk management and
financing programs.
The USI team is a true partner and works with you to create strategic risk management
solutions in the following areas:
• Construction All Risk
• Workers Compensation
• Employers Liability
• Third Party Liability
• Advanced Loss of Profits
• Surety
• Contractor Default Insurance
• Claims Services and Advocacy
• Loss Control
• Environmental Risk Mitigation
• Enterprise Risk Management
The USI Construction Practice takes a broad-based approach to the assessment and effective
management of our construction partner’s comprehensive financial risk profile. We use our
knowledge and experience to develop a clear understanding of our clients' needs,
thereby assisting in the effective analysis, control and transfer of risk.

10. Risk Management Philosophy
The USI Risk Management Division provides services to clients in the middle and upper middle
market segments, which is traditionally underserved by multinational brokers with similar skill
sets. Our clients have the need for risk management related service, support and analysis, but
typically have a small risk management staff, if any. Our philosophy is to partner with our clients
to become an extension of the risk management department by performing the tasks necessary
for internal support, including providing reporting information suitable for board level review.
The risk analysis is strategic as well as technical. Strategic analysis is a joint effort with our clients
to determine the current risk profile of the company, the economic impact of that profile, and the
proper risk finance methodology. In some cases, we are present at the formation of a new risk
management department, and can assist in the structure of the program from the outset
Technical analysis is an ongoing service designed to
provide risk specific, actuarial, and claims data in the
time and format most useful for the client. These can
be bundled or unbundled services including
Environmental Risk Analysis, Loss Control, Actuarial
Based Analysis and Reporting, Claims Advocacy,
and Program Design and Placement supported by
our Service Model.
We are not simply selling products; we are
providing capital-based and information-based
solutions.
Our capacity to provide such solutions is based in the
understanding that insurance is just another form of
capital. It is fungible and by its nature is often the
most efficient financial solution available, as proven
by its commoditized nature. We think with our clients
in terms beyond commoditized product sales, and
instead, take the view of a risk manager, using
insurance as one available tool. This allows us to
give our clients a broader view of available options.

11. Directors & Officers Coverage
In 2006 USI was chosen as the partnering retail broker by NASDAQ to support their wholly
owned Directors and Officers Insurance operation in the Southwest. This exclusive relationship
significantly expands USI’s D&O information resources and placement capability. In alignment
with our Risk Management philosophy, we take a consultative rather than a transactional view of
D&O insurance. Our expanded team consists of over 70 industry professionals dedicated to
professional lines of coverage, including: Directors and Officers Liability, Employment Practices
Liability, Fiduciary Liability/Crime, Errors & Omissions, and Mergers & Acquisitions.
We jointly consult and place D&O
coverage for over 350 public companies
and over a thousand private companies
in a variety of industries – from microcap
to Fortune 500.
We use NASDAQ’s proprietary D&O
database with multiple years of data to
benchmark client accounts.
Benchmarking is based upon Securities
Litigation Trends, Projected Settlement
Analysis, Pricing, and Peer Purchasing
Trends. The unique resources available
to our clients through this relationship are
unmatched in the industry.
Major carriers use us for new product definition. We have routine inquiries and referrals from
major law firms throughout the country. We provide our clients with high-level policy summaries
and comparisons. Service standards and timelines are part of the placement and ongoing
account service methodology to ensure management of the process to each client’s standards.

12. Environmental Risk Mitigation
Single Source Environmental Strategic Resources.
Risk Management Specialized Skills.
Specific Solutions.
Providing an array of environmental risk
The USI Environmental Risk Mitigation Group
management solutions:
capability cuts across industries. ERMG provides
• Environmental Risk Profiles
strategic information and specific solutions to
• Environmental Exposure Analysis environmental problems and opportunities utilizing
• Risk Mitigation Structuring our unique environmental resources.
• Environmental Law Profiles Decision-makers benefit from direct access to a
• Environmental Loss Modeling national network of seasoned professionals who
• Environmental Insurance provide the most accurate, up-to-date information,
Program Evaluation linking the various disciplines of environmental risk
• Insurance Policy Form Analysis management.
• Environmental Insurance Program The Power of Professional
Marketing Relationships
• Remediation Cost Caps for Developers Selected from the ranks of environmental
• Lender Liability Protection underwriters, attorneys, marketers, educators and
• Web Based Interactive environmental risk managers, this superior
Environmental Risk Management resource group offers a breadth of specialized
Programs for Clients knowledge and technical skills –and the ability to
• Education and Training Programs deliver innovative solutions to meet your business
objectives.
ERMG uses as its network platform the online
Environmental Knowledge Delivery System
(www.environmentalriskmanager.com). This
relationship makes available the benefits of our
licensing agreement with the International Institute
Environmental Risk Management (“I2ERM”) in
conjunction with Texas State University, allowing
USI to obtain for our clients the latest information,
knowledge, and solutions for environmental risks.

13. Program Design & Placement
Each risk management program includes elements of self-insurance, risk transfer, risk avoidance
and risk reduction. Our objective is to assist clients in the identification of exposures to loss and
determine the most economical means of dealing with each risk. The outcome is a
comprehensive plan that maximizes positive economic impact and minimizes catastrophic
exposure to the balance sheet and current year cash flow.
A crucial part of program development is
identifying and quantifying expected losses and
pass-through loss costs then structuring a plan
to address those known losses. Our Risk
Management Division helps clients quantify
those losses by use of actuarial principles and
the latest catastrophe modeling software.
Identification of burning layers in the context of
each client’s risk appetite will combine to
determine the most economical structure by
In addition to plan structure, an understanding of the insurance marketplace and having
relationships with those carriers capable of providing coverage are necessary. USI has access to
and works with financially stable domestic and international markets to ensure the ability to place
any structure we jointly conceive with our clients.
Non-traditional risks need to be analyzed and
mitigated, as well. We have specific resource
capabilities to resolve domestic and international
non-standard risks. We advise and place
alternative risk products, risk finance options,
contingent risks and weather derivatives. These
tools can be used in concert with traditional
retention and insurance models to mitigate
differences in conditions or risk aggregation
problems.

14. Catastrophe Loss Analysis
Catastrophic Modeling
Catastrophes can strike at any time and in many forms,
from hurricanes to earthquakes to terrorism. When we
see the effects of a Hurricane Katrina or the Indonesian
earthquake and tsunami of 2004, we are reminded not
only of the personal tragedy and cost in human lives,
but also the incredible financial risk to which each of
our client companies is exposed. To prepare for and
minimize the impact of a catastrophe on a company’s
assets, a comprehensive risk management strategy
must be developed.
The foundation of this plan must be built upon the accurate quantification of physical values
exposed paired with the likelihood and extent of the catastrophic event. USI provides the tools to
develop a sound catastrophic risk management program.
Natural catastrophe models are a complex
Loss Estimates from system of algorithms that incorporate the
Modeling assist with the fundamental physical characteristics of
catastrophic events and expresses them
following:
mathematically. These characteristics are then
•Manage areas of high exposure to
applied to a geographical distribution of
catastrophic loss.
exposures. In addition to loss probability, the
•Estimate consistent and reliable loss characteristics of a portfolio’s physical assets,
costs for all locations.
such as age, construction, and zip code, must
•Develop data to more effectively also be considered when formulating and
negotiate property insurance terms and evaluating ultimate financial risk. USI provides
conditions. this analysis so that clients can make informed
•Purchasing appropriate limits. decisions on limits, retention levels and
•Demonstrate sound risk management whether to retain, mitigate with loss control or
practices. contractually transfer the risk through an
insurance product.

15. Owner Controlled Insurance
Owner-controlled insurance programs (OCIPs), also called wrap-up insurance, are insurance
programs designed for large construction projects. Under such plans, the project owner procures
certain insurance coverages for all tiers of contractors and sub-contractors performing jobsite
operations. This program replaces the traditional approach where owners require contractors to
provide proof of Workers Compensation, Liability and Property insurance. Under an OCIP, the
owner assumes the insurance burden by defining the insurance limits, establishing and
supporting OCIP administration, establishing the risk sharing profile of the program, assuming the
responsibility for safe workplace operations to include the work of all contractors, and purchasing
the insurance
Increased Popularity of OCIPs
The use of OCIPs is expanding from several
factors:
• The increase in the number of large
capital improvement projects
undertaken to repair the nation’s
deteriorating infrastructure.
• The booming economy fueled by the
growth and expansion of high-tech
businesses.
• The implementation of less stringent
insurance regulations.
OCIPs generally produce lower insurance
costs to the owner compared to the • A highly competitive construction
conventional approach. This is driven by insurance market.
increased buying power by pooling coverage,
reduced construction cost by eliminating overhead and mark-up in contractor bid amounts,
elimination of inter-insurance company litigation, elimination of duplicate coverage, fewer
accidents due to central oversight and workplace safety methods, reduced administrative costs
compared to collection and auditing of contractor policies, and potential cash-flow benefits by
master financing of the project premium.

16. Private Equity Practice
USI is redefining the role of the insurance broker in private equity transactions. By developing
long-term strategic relationships with private equity firms and their various partners we can
consistently improve the efficiency, structure and investment returns on private equity
transactions. As a privately held company owned by a significant private equity firm we
have the experience, flexibility and the speed to react more creatively to deal-specific
hurdles and the special needs of private equity companies.
The USI Advantage
We match great people with a
great process, so you get
consistently strong results.
People - Small brokers/agents have
limited resources. Large brokers save
resources for their Fortune 200 clients.
USI Southwest has developed a
A Dallas-based private equity firm
comprehensive set of specialized
resources and expertise to meet the reduced employee benefit costs
needs of the upper middle market. Risk for two of its portfolio companies
Management, Executive Protection, by more than two million dollars
Environmental Risk Mitigation,
in annual fixed expenses. Utilizing
Advanced Claims Advocacy and
USI’s Benefit Portfolio Solution
Health/Welfare.
resulted in a larger multiple on
Process - Most brokers have inferior EBITDA, dramatically increasing
processes or no process at all. USI the firm’s capital gain at liquidity.
Southwest has developed a patented
process that is individually tailored to Our combination of strong experience in
meet your needs, is measurable so we diverse industries and our responsiveness
know if we are performing, is results in meticulous due diligence,
accountable to you, is aligned with your creative and cost-effective insurance
goals and objectives and is proactive, solutions, and the development of unique
not reactive. product and financing alternatives.

17. Surety Specialization
USI has contract and commercial surety specialists within our construction practice dedicated to
the creation and management of programs specifically designed for the construction industry.
Surety bonding has been used in the construction industry for more than 100 years. Most
contractors are required at some time to provide a bond to guarantee performance. Frequently
bonds are the key to a construction project and the inability to become bonded may lose a
contractor work.
Ability to secure credit can be
adversely affected by changes in
the worldwide financial markets
and bank lines of credit may be
particularly vulnerable. A surety
facility gives a contractor an
advantage in overcoming such
uncertainties.
Contractors need a reliable bonding facility at a competitive cost. Although bonds can be
provided by either banks or insurance companies, a bond obtained from a bank may impact upon
a contractor's borrowing facilities since banks tend to consider bonds as a financial liability and
reduce the contractor's credit facility accordingly. Commercial surety bonds provided by an
insurance company offer a dynamic financial management tool often providing off-balance-sheet
credit on terms and conditions more favorable than other financial instruments.
An alternative to subcontractor bonding is contractor default insurance (CDI). CDI indemnifies the
insured for losses incurred as the direct result of a subcontractor or supplier default. It also
provides coverage for losses that are the indirect result of a default such as liquidated damages,
acceleration of other subcontracts or extended overhead. CDI delegates control of default
remedy to the insured. Thus empowered, general contractors can act more quickly to address
potential defaults and mitigate the impact if they do occur.

18. Service Standards
InServ Service Standards
InServ is a service platform that allows each service
team to track the activities needed in the servicing,
marketing and management of an account. Most
large brokerage firms have defined service
standards, however, it is incumbent on the account
manager to track and adhere to agreed
performance standards. Given the service slippage
that can occur in such an environment, USI has
developed automated support to our servicing
platform to track service requirements. Over time
we expected to continually increase the level of
automated support we now enjoy.
The Inserv model is implemented via our account
• 120 day renewal lead times
management system. A timeline is created with
• Risk manager submission
each client that identifies tasks that require action
approval
on specific dates throughout the policy year. A
• Policy delivery within 60-days graphic timeline is provided to the client to illustrate
of binding the agreed service plan. As the account data is
• 24-hour endorsement subsequently entered into our account management
request and certificate system, the pertinent dates in the timeline are
issuance diaried so that automated notices are generated to
ensure timely response to the agreed actions. Each
• Quarterly TPA/Claims
team member is required to create such an activity
reviews
support plan with automated diary entries so that we
• 180-day stewardship meeting can initiate the required activity at the right time.
Accounts are internally audited three months after
the effective date for compliance to these service
standards.

19. International
The world is smaller today than ever. In fact, many USI
clients are multinational corporations, with multiple
foreign locations and workers, transacting business with
the entire world. Some are manufacturing their products
overseas for distribution here in the US while others are
also selling their products to a vast international
marketplace. Never has a comprehensive global risk
management expertise and philosophy been more
necessary. At USI, we have the experience, the
network, and the markets to implement the international
International Coverages
• Foreign Casualty risk management philosophy of our clients. Our people
• Foreign Property
• Kidnap & Ransom have structured international programs for some of the
• Employee Benefits
largest corporations in the country and they bring that
• Political Risk
• International Transit & Cargo expertise to each client’s account. USI can place a
• Stock Throughput
• Product Recall and Expense simple trip travel policy or structure a global loss
• Foreign Products Liability
• Currency Conversion sensitive program that will minimize a client’s cost of risk
• Work Comp/Social Security
while maximizing their use of foreign currency.
Understanding various legal systems, insurance laws and languages can be a daunting prospect
when implementing a global risk management program. As members of the Worldwide Broker
Network, USI has access to the technical, legal and professional resources of over 8,500
insurance professionals in more than 75 countries. Empowered with this resource, USI helps our
clients overcome country-specific insurance policy and claims issues. In addition, USI has direct
access to all of the international markets and then, through the WBN, we have access to the local
markets that we must access to provide the necessary admitted coverage.

20. Claims Advocacy & Data Services
USI recognizes the value of claims handling and claims information to the present and future
viability of a client’s account. There are prevailing industry problems with each aspect of claims
management that we individually target, with a goal to improve the overall claims handling
process, claims costs, settlement procedures, and data collection and reporting. When each of
these operating segments is not properly controlled and managed, the result can be costly in a
variety of ways.
USI partners with our clients in an oversight, process management and data collection role. In
this role we enhance the existing services provided by TPAs and insurers, augment the
usefulness of claims data with specialized reporting, and provide direct professional guidance and
oversight on claims management.
This includes tracking specific large claims in concert with the TPA efforts. It also includes taking
measure of the methods and practices used by your TPA and making advisory recommendations
to improve the process, reduce costs, control costs, eliminate process bottlenecks, and
streamline the operating method as necessary.
The raw information is transferred to RiskEnvision, USI’s
internal automated data collection system. The system
provides for consistent aggregation of claims data. Once
transferred, the data becomes uniform, eliminating the
problems of varying reporting formats from different
insurers, incomplete data sets, unsuitability to various
sorting options, and tight limitations on report generation
capabilities.
By further benchmarking this information, third-party operator efficiency can be documented
against peers and industry standards. Within the resulting framework, Loss Control standards can
be created, and cost management steps can be initiated.

21. Risk Control Services
USI Risk Control Services assists clients by Risk Control Services
supplementing or providing a range of Loss
•Reduce Employee Injury Rates
Control services for development &
and Related Risk Costs
implementation of Risk Management strategies.
Our in-house loss control professionals utilize • Reduce Fleet, Property & General
loss and experience data to enhance safety and Liability Cost of Risk
improve work environment risk profiles
• Asset Protection Program
• Coordination of Insurance Carrier
This is accomplished by developing a forensic
Safety Services
understanding of each client’s operational profile,
• OSHA Benchmarking
related exposures for loss, prevailing corporate
• OSHA Compliance Assistance
culture, client specific appetite for risk, and risk
management driven objectives. From this • Employee or Management
information, USI develops a Risk Control plan Training
tailored to each client, and then assists in • Accident Investigation
operational implementation and oversight until
the objectives are met.
A national property management and
real estate developer, was able to
reduce losses by more than 30% in
year over year losses after
implementing USI’s recommended
risk control plan. USI’s Risk Control
representatives attributed success of
the plan to program development,
follow-through and continued
oversight by USI’s Risk Control
representative.

22. Risk Management Services
Technical Services
The USI Risk Management Division uses actuarial principles to provide services to our clients in
need of technical information to support risk management decisions. These services are provided
automatically to clients when we act as broker and place their corresponding coverage. Services
can also be unbundled and provided on a contract basis. Our RMD services are provided by
personnel in our Houston regional office.
Collection, Interpretation and Analysis of
Loss Data
In concert with our claims support function, USI
can import loss data from a variety of disparate
sources (TPAs, insurance company databases,
etc) and collate it into a single system. The data
is then parsed for analysis and interpretation.
Loss Forecasting
Loss triangles and reserve analyses are created
to provide the client with reasonable expectations
of future claims costs on past losses. Similarly,
loss projections frame expectations for future WORKERS COMPENSATION
INCURRED LOSS TRIANGULATION
claim experience. The information can be used As of MARCH 31, 2006
Losses
for program design and placement, for corporate Policy
Inception
(Oldest
to 106
Current) 10 Months 22 Months 34 Months 46 Months 58 Months 70 Months 82 Months 94 Months Months 118 months
budgeting purposes, and for determining LOC/ 96/97 100,000 268,245 268,245 268,245 485,706 486,303 515,199 236,420 231,233 231,233
2.68 1.00 1.00 1.81 1.00 1.06 0.46 0.98 1.00
security needs for casualty lines of coverage. 97/98 100,000 216,965
2.17
227,371
1.05
231,022
1.02
201,992
0.87
215,241
1.07
215,241
1.00
215,241
1.00
215,242
1.00
215,242
98/99 191,240 238,347 257,767 353,066 263,161 263,161 263,161 266,011 263,351 263,351
1.25 1.08 1.37 0.75 1.00 1.00 1.01
99/00 174,541 503,201 581,892 657,150 540,372 540,372 540,372 545,776 540,318 540,318
2.88 1.16 1.13 0.82 1.00 1.00
Benchmarking 00/01 64,085 235,390
3.67
187,422
0.80
256,752
1.37
262,832
1.02
299,956
1.14
302,956 305,985 302,925 302,925
01/02 75,000 191,516 274,442 268,974 329,642 342,828 346,256 349,719 346,221 346,221
Client data can be compared to peer data sets 02/03 220,584
2.55
640,253
1.43
625,891
0.98
569,054
1.23
614,578 639,161 645,553 652,009 645,489 645,489
2.90 0.98 0.91
via USI’s national subscription database source. 03/04 272,529 348,372
1.28
208,291
0.60
231,203 249,699 259,687 262,284 264,907 262,258 262,258
04/05 711,110 415,405 419,559 465,711 502,967 523,086 528,317 533,600 528,264 528,264
The resulting comparatives provide insight into 2005/6 348,929
0.58
774,622 782,369 868,429 937,903 975,420 985,174 995,026 985,075 985,075
peer coverage limits, premium costs, and Avg.
Incremen
tal LDF X 2.22 1.01 1.11 1.08 1.04 1.01 1.01 0.99 1.00
Cumulati
retention limits. ve LDF X 2.82 1.27 1.26 1.13 1.05 1.01 1.00 0.99 1.00
Cl i Ad d D t

23. Health / Welfare
Careful strategic planning, ongoing evaluation and our unique service platform are the main
drivers that assure a comprehensive and competitive employee benefit program. We approach
this process by defining your objectives and developing an organized action plan to achieve those
objectives. Based on information gathered from both the client and the carrier we provide a
complete analysis of the client's existing plans and contractual arrangements; as well as,
demographic analysis, historical claims and reserve analysis. These analyses allow us to
effectively advise you regarding plan design, funding options and administrative support.
USI Compliance Department
Our ERISA and compliance attorneys
regularly meet with our clients regarding new
developments and issues related to Welfare
plans. They guide our clients through
intricate and complex risks associated with:
• COBRA, HIPAA and FMLA
• HSA / FSA
• Sick Leave and Re-Hire Provisions
• Wellness Guidelines within ERISA
• Medicare Part D
We establish a baseline by reviewing cost
• Contribution Modeling
containment and wellness strategies,
• SPD Evaluations
evaluating provider networks for
• Non-Discretionary Employee
applicability and access, and by reviewing
Eligibility Classes
the executive benefit programs.
Plan design alternatives that could positively impact claim cost and/or administration expense are
identified and evaluated. Various stop loss and pooling level options are studied based on the
client’s risk tolerance. We know that efficient implementation and effective employee
communication is critical and our proven process insures a successful role out and enrollment.
Our USI Service Timeline insures that all deliverables are identified and addressed during the
program year.

24. Employee Benefit Communication
Workplace Benefits
Communication / Data
Cleansing
USI Workplace Benefits is a wholly owned
subsidiary of USI. USI Workplace Benefits is
the leading benefits enrollment company in
the country, providing services to more
employees than any other of its type. This
unique service is a one-on-one automated The steps include the following:
benefits enrollment service to public and
• A USI representative works with your
private companies across the country.
human resources department to
It is typically not possible for the human
download your benefits data into the
resources department of a company to have
Benefits Communication system.
one-on-one contact with each employee to
• During the annual enrollment period,
discuss benefits. This is especially true if
USI representatives meet with each
employees are spread across the country.
and every employee personally or by
Regardless of the employee count and
telephone to guide them through the
location, during the benefits enrollment
benefits selection process.
period, a USI representative will personally
• A dependent audit is performed at
talk to each and every employee, guiding
the enrollment point to cleanse the
them through the benefits election process.
enrollment of any non-qualifying
Having a union workforce is not an issue with
participants
implementing this enrollment product. In fact,
unions typically embrace the process. Like
• This can be done on a no-cost basis.
USI Workplace offers additional
the human resources department, the union
voluntary benefits to employees at
rarely has a vehicle through which they can
enrollment. The income from the
have one-on-one contact with its members.
voluntary benefits pays for the
We have enrolled companies with both union
communication and data cleansing.
and non-union employees, and used the
enrollment to convey union information to its
members.

25. Alternative Risk Solutions
In some circumstances standard insurance coverage can not address the risks a company faces.
Similarly, traditional capital sources are typically not available to fund or offset non-standard risks.
Clients find themselves retaining financial and operating risks they’d prefer to transfer. Alternative
risk finance solutions are creative ways to either transfer such risks, or, to retain them in a way
that minimizes the financial downside.
Completed Projects
• Enhanced over $1 billion in securities
for Petrobras
• Enhanced the first government backed
securitization for the country of Belize
• Enhanced the first mortgage
securitization for the country of Ukraine
• Eliminated risk elements for a $55
million funding for offshore Pemex
construction
• Sourcing funding and insurance for an
existing client for a $100 million
pipeline supply project
USI develops innovative solutions that help clients mitigate complex or difficult-to-address risks
by combining insurance, financial and capital market strategies. Risks that create capital
inefficiencies are targeted on a domestic and international scale.
Our alternative risk experts have solved problems for mid-cap to large-cap corporations around
the world. Our role varies from advisory, to structuring, from consulting to providing capital
through our partnering relationships. The answers are not product driven, but capital driven, and
they manifest themselves in a variety of ways – insurance policies, derivatives, senior or
mezzanine capital, project finance and self-funded facilities designed to smooth the volatility of a
risk over time. We begin creating solutions where the traditional markets end.

26. Weather Derivatives
Weather Call Options
This coverage is structured as a derivative instead of an insurance indemnity policy on an annual
cumulative or weekly basis for risks of rain, snow and/or wind at selected locations. Proof of loss
is not required, simply proof of event, which allows you to estimate extra-expense and revenue
shortfalls correlated to weather events, and recover the loss on a call option basis, creating a
fixed cost cap on the risk.
For example you determine that snowfall or
freezing temperatures can cause disruptions
or delays resulting in loss of cash flow or
trigger additional expenses such as
liquidated damages, the aggregate effect of
which you want to cap in your budgeting
process. You can enter into an option
agreement that would include a traditional
insurance styled actuarial approach.
We would determine the 25–year average weekly snowfall at the locations in question during the
months desired. Let’s assume that number is 8-inches at each location. A retention would be
added – let’s use 2 additional inches per location per week. We would determine the amount of
potential losses/expenses to be incurred under the scenario described; let’s assume its $500,000
per week. An option contract would be written and an option fee charged. If, then, at any time
during the designated period, more than 10-inches of snow fell at a designated location, the call
would be exercised and the counterparty would pay $500,000. There would also likely be an
aggregate cap in the option contract.
Since there is no insurance involved, there is no proof of loss. This is event driven. If the event
happens, the option is exercises. This is easy to do with weather since there is significant data
available from weather stations everywhere. In your case, it’s even easier since the weather
station is usually at the airport.

27. Team Chart
USI Southwest
REAL ESTATE PRACTICE
TEAM LEADER / COORDINATION
Property Engineering Account Risk
Specialist Specialist Executive Management
Program Design COPE Service Data Analysis
Placement Primary Coordination Risk Finance
Secondary
Characteristics
Environmental
Property Senior Account Specialist
Intermediary Manager USI ERMG
Placement Catastrophe Account
Modeling Maintenance
Specialist Claims
PML Analysis Advocacy
Values Exposed Complex Claims
Surety Account
Specialist Manager
Program Design Business Technical Loss
Placement Impact Support Prevention
Specialist USI Loss Control
BI Analysis
Claims
Manager Management
Claim Liability
For additional information on the D&O Specialist
USI Southwest Real Estate Risk Coordination
Services Practice Group, please
contact:
Perry Smith Shawn Heiser, CIC, ERM
RE Practice Director - Senior Vice Client Executive &
President Environmental Risk Specialist
USI Southwest USI Southwest
1445 Ross Avenue, Suite 4200 1445 Ross Avenue, Suite 4200
Dallas, Texas 75230 Dallas, Texas 75202
(Office) 214.443.3155 (Office) 214.443.3103
(Cell) 214.957.1575 (Cell) 228.383.5946
perry.smith@usi.biz shawn.heiser@usi.biz
Jill Webster, CPCU, ARM, CIC Donnie Whitworth
Account Executive Client Executive
USI Southwest USI Southwest
1445 Ross Avenue, Suite 4200 1445 Ross Avenue, Suite 4200
Dallas, Texas 75202 Dallas, Texas 75202
(Office) 214.443.3137 (Office) 214.443.3123
(Fax) 214.443.3900 donnie.whitworth@usi.biz
jill.webster@usi.biz

28. Sue Myers, CPCU, AIC, ARM Linda Hoover, CPCU, CIC, SCLA, CRM
Technical Underwriting Coordinator Risk Management/Claims Advocacy
USI Southwest USI Southwest
1445 Ross Avenue, Suite 4200 1445 Ross Avenue, Suite 4200
Dallas, Texas 75202 Dallas, Texas 75202
(Office) 214.443.3184 (Office) 214.443.3196
(Fax) 214.443.3900 linda.hoover@usi.biz
sue.myer@usi.biz
Steve Campo Rusty Compton
Practice Leader - Management Senior Vice President – Group
Professional Services Health Benefits
USI Southwest USI Southwest
1445 Ross Avenue, Suite 4200 1445 Ross Avenue, Suite 4200
Dallas, Texas 75202 Dallas, Texas 75230
(Office) 214.443.3168 (Office) 214.443.3110
steven.campo@usi.biz rusty.compton@usi.biz
Lynn Owen, CIC Joella Heath
Regional Account Executive - MPS Claims Representative
USI Southwest USI Southwest
1445 Ross Avenue, Suite 4200 1445 Ross Avenue, Suite 4200
Dallas, Texas 75202 Dallas, Texas 75202
(Office) 214.443.3114 (Office) 214.443. 3150
lynn.owne@usi.biz joella.heath@usi.biz
USI Holdings Corporation is a leading distributor of insurance and financial
products and services to businesses throughout the United States. Founded
in 1994, USI has grown – organically and through acquisitions – to become,
according to Business Insurance, the ninth largest insurance broker in the
United States. USI is located in 19 states and is headquartered in Briarcliff
Manor, New York. For more information regarding our value-added insurance
products and services, visit our Web site at www.usi.biz.
USI Southwest Real Estate Practice
1445 Ross Avenue, STE 4200
Dallas, TX 75202