Both Mr. Motamed and Mr. Angerami held previous positions at Chubb–Mr. Motamed as chief operating officer, and Mr. Angerami as president of Chubb's E&S business. At Chubb, back in 2000, Mr. Motamed tapped Mr. Angerami, who had been working on the retail casualty side of the Warren, N.J.-based insurer to overhaul Chubb Custom, the company's E&S unit.

“We literally dumped out all the pieces and started over again–product, producer plant and everything else,” Mr. Angerami recalled, explaining that in the years that followed, the unit grew from very small and very unprofitable operation to a very large and very profitable one.

While CNA's units collectively write only about $100-to-$150 million in premiums today, Mr. Angerami describes the work ahead at CNA as an expansion rather than an overhaul.

“We want to be consistent in the marketplace. That means we're going to build on where we are,” he said.

“We're going to expand into areas where we think we can do well that we're not doing currently,” he added, objecting to the word “change” to describe the process that lies ahead.

“'Change' sometimes means that you're going to run away from what you're currently doing. Certainly if there's a business that becomes problematic, you have a responsibility to exit that, [but] that's not really the thought behind change” at CNA Select Risk, he said.

“'Change' for us is more of a building process–so that as you get out a couple of years and look back, we will be a much different organization, [but it will be] because we'll be doing more things for industry groups and more brokers with more people,” he said.

Mr. Angerami and Vice President Jeff Segall said CNA Select Risk will benefit from the advantages of a large retail organization–such as claims and risk control expertise–but underwriters won't be constrained by a standard lines mindset.

“What makes a surplus lines risk a surplus lines risk is that it doesn't conform to the appetite that retail companies have– it's too volatile or too unusual,” Mr. Angerami explained, adding that typically, underwriters working inside a retail organization “wind up being fenced in or controlled by that retail appetite.”

In contrast to other organizations where a large amount of business is produced by retailers, however, he said he has found “a better appetite for risk” at CNA.

“There's a willingness to look at risks that fall outside the traditional retail standard market appetites, evaluate them and say, yes, there's a way to do that. There's a price that makes sense and there's a reinsurance arrangement that controls the amount of exposure we retain in house,” he said. “It really takes a different view, [and] other organizations that are dominated by retail business never get there.”

“CNA can. CNA has,” he reported.

Going on to describe CNA's E&S operation today, Mr. Angerami took time to clarify some information in a press statement announcing his appointment, which described his role as one of “expanding the commercial insurer's standard lines business through the wholesale distribution channel.”

The phrasing, he said, was meant to distinguish E&S property and casualty business from professional and management liability lines–sometimes referred as “specialty” business within the organization.

The term “standard lines” was used in that announcement “to start to explain that what we would be building out would be a facility for nonadmitted p&c business as opposed to nonadmitted specialty,” he said.

Mr. Segall said an appropriate description of Select Risk business might be “standard lines business with a small 's,'” to denote standard coverages such as auto and general liability, but nonstandard risks that require nonadmitted paper.

Today, that's a small part of the $700 million premium volume written in CNA's nonadmitted company, Columbia Casualty, where the bulk of the premiums are from the “special specialty” lines like health care liability and directors and officers, the two men said.

Going through plans for each E&S unit of CNA Special Risks, Mr. Angerami started off with the casualty area. Within that area, he said CNA continues to have an appetite for the kinds of risks that never migrate back to the standard market–”risks placed on an independent placement (brokerage) basis, for tough product liability lines,” for example.

“Our appetite starts with alarm manufacturers, bicycle manufacturers, cable chain and wire manufacturing, electrical components and equipment manufacturers,” he said, alphabetically reciting some of the classes “that really do end up and stay in the surplus lines marketplace.”

CNA's positioning in the wholesale casualty arena is currently very strong, he reported, based on his early conversations with wholesalers. “It is business they have and would like to place with CNA. The issue becomes access, or size of our resources,” he explained, noting that there's work to be done in “scaling out the organization, hiring more underwriters and doing business with more producers to attract more of business in.”

“While we're doing that, we're looking to complement the current appetite list with things that aren't on it,” he said, noting that CNA is also looking to hire underwriters with expertise in areas that aren't on the list.

The model for casualty may well be the Atlanta-based transportation operation run by John Baskam, Mr. Angerami noted, describing it as a “segment specialty” within the CNA E&S business units.

Defining the term “segment specialty,” he said such a niche is created by internally bringing together a group of experts on a particular coverage or a portfolio of coverages for a particular industry and then having the internal specialists go out and look for specialist brokers to place that type of business.

Mr. Baskam is “a recognized industry specialist,” who manages a diversified book that includes trucks, taxis and limousines, according to Mr. Angerami. The transportation unit does business with fewer producers than casualty, but they are all expert brokers in the transportation arena, he said.

Illustrating how a segment specialty can grow, Mr. Segall noted that charter buses were added to the transportation mix just before Mr. Angerami came on board, and that limousines are an even more recent addition. Within the last two months, CNA also expanded its writings of trucks and taxis from eight states to 11, he said.

In the third E&S unit–programs–Mr. Segall said there are currently about a dozen programs written by managing general underwriters who have delegated authority.

Mr. Angerami–who listed a wide variety of programs, ranging from Idaho schools to demolition contractors to machine shops to tattoo parlors–said a common characteristic of the programs is that all have “an aspect to them that is surplus lines.” In other words, they are tough or unusual accounts you wouldn't find in the standard market.

In addition, he said multiple insurance lines are often involved in CNA's program offerings, including property, liability, auto and even some incidental professional liability. For example, a municipality program includes public officials' E&O, while the school program has educators' legal liability.

He said part of the expansion game plan involves seeking out more programs. “We have a group of professionals inside CNA who understand the business, know how to put it together, [and] actuarial support to analyze the business in a timeframe that keeps us competitive,” he said.

Mr. Segall said program specialists on the E&S side benefit from “lessons learned in the standard lines” divisions of CNA.

“Unlike a lot of other E&S companies that operate exclusively as E&S companies, we have our own risk control [and] claims folks. So we learn what's going on. We see trends,” he said.

For example, there are 200 risk control people dedicated to the construction area “from the ordinary retail standard lines side” of CNA, he noted. “We're able to capitalize and bring them into the picture” for programs like demolition contractors.

Similar benefits apply in the E&S transportation unit, he said, noting that handling claims for truckers is unique. By sharing in the wealth of resources devoted to transportation for the larger CNA organization, the E&S transportation unit doesn't just control its own expenses. “It also controls the cost of risk for the folks we insure,” Mr. Segall said.

“We help improve many of these kinds of second-avenue risks,” he said, preparing them to go into the standard lines market.

Mr. Angerami described the last E&S unit–property–as “a work in progress,” noting that the only distinction today between the CNA standard, large-lines property operation and the E&S property operation “is the distribution play.”

Essentially, large accounts are being sourced to a wholesaler for access to a market that has large property expertise, he said, noting that the goal is to build on that and also to “migrate into true E&S property business.”

“We're evaluating the details of the exact strategy and appetite today, staff requirements and infrastructure needs,” he said in an interview earlier this month, citing systems and actuarial support as examples. “We've been looking at that for the eight weeks I've been here, and we are getting very close to introducing a new strategy to our producers.”

What is true E&S property business?

Mr. Angerami said properties that aren't as well protected as standard market placements, or properties that might have some unusual exposure, such as vacant properties, would qualify. Those are written on nonadmitted paper because of the exposure they present, he noted.

In contrast, most of the business that CNA's property underwriters write today is admitted business, he added. “There's nothing special about it other than the fact that it's large, or it's layered, or it has catastrophe exposure.”

The reason it gets to a wholesaler is because the controlling retailer doesn't have access to markets that have the appetite or ability to write large property, he explained. “Our underwriter really writes a policy for that wholesaler that could be written in CNA retail if it came directly from a retail producer,” he said.

Mr. Angerami views the current E&S property unit as the foundation of what's to come, noting that the unit is already staffed with seasoned underwriters. “There isn't a lack of technical expertise internally to do what we want to do,” he said, explaining that the unit just needs more underwriters “to build it out on a countrywide basis [and] to take it to the next step.”

Across all four E&S units, Mr. Angerami envisions that CNA will “double, if not triple” its staff over the next two-and-a-half years, and “probably double the number of producers” working with CNA Select Risk.

He also foresees the prospect of leveraging existing broker relationships–placing property through wholesalers currently designated to work with CNA Select on casualty business, and vice versa.

“If you superimpose the number of property brokers we work with on top of the number of casualty brokers, there aren't a lot of matches,” he said.

As far as the targeted mix of business among the four E&S segments, nothing is set in stone. While all the groups have about the same amount of business volume right now, going forward the situation “will be very dynamic. It is going to change, and it's going to change rapidly,” Mr. Angerami said, noting that the rate of growth in each unit will depend on marketplace and CNA's ability to grow staff and infrastructure.

Overall, Mr. Angerami reported that there is no shortage of interest from applicants wanting to join CNA Select or reaching out with ideas for new segment specialties.

“People want to be part of a business that's building and envisioning a future that's got possibilities and creativity and growth and profit involved. That's certainly why I'm here,” he said.

Mr. Angerami believes that now is exactly the right time to be building, even though a soft market continues in many areas of the p&c insurance business “You don't want the marketplace to change and then build the machinery,” he said.