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Gray Matters: Nancy Gray is a captive queen at Aon, having earned her crown by juggling a booming business in Vermont with major growth in emerging onshore domiciles. How does she do it?

It would be easier to sympathize with Nancy Gray if she didn't thrive so well in the chaos around her.

After all, her responsibilities have intensified in the six years since her employer International Risk Management Group was acquired by Aon in 2001. Gray has leapt from deputy manager of Aon's Vermont captive office, to managing director of Vermont, to her current charge as executive director, North America, Aon Insurance Managers--and that was just through 2003.

Her responsibilities have grown right along with the captive industry. Captive legislation has been passed in a number of states, and promising young onshore domiciles are making headlines for themselves. As a result, Grays oversight of North America has now taken on new meaning and more responsibility.

In addition to leading her broker's charge in Vermont, Gray leads the charge in Aon's Canada and Hawaii offices. She also supervised the 2004 openings of new offices in Phoenix and Charleston, S.C.

"She's juggling a lot of different things at a lot of different times," says Stephen Cross, CEO, Aon Captive Services Group. "It's extremely challenging, but she seems to handle it all very well. I think she finds it all very exciting, actually."

Those less suited to managing a swiftly evolving business might find it more terrifying than exciting. Not Gray. The 42-year-old Vermont native finds time to take on advisory roles and to speak at engagements at various captive domiciles, while lending a hand in pioneering the International Center for Captive Insurance Education, and serving as the representative of the Aon Global Risk Consulting Americas Operations Board to the jurisdictions of Bermuda, Cayman and Barbados.

Not to mention, she's the mother of two young teenagers: son Kyle, 15, and daughter Kathryn, 13. How's that for a "wow" factor?

Grays success arises from her ability to channel the energy from the pandemonium around her and reorganize it into a rational outcome.

"She's a stabilizing force," says Ken Long, executive director of risk management at San Antonio, Texas-based AT&T Inc.'s global headquarters. That compliment is a hefty one, coming from a senior manager at a company with more than 300,000 employees where the only constant is change.

AT&T has recently undergone a series of buyouts and mergers--Pacific Bell, Ameritech, Southern New England Telephone, Legacy AT&T, Bell South, Cingular Wireless--companies that had their own independently managed captives. Gray has been the helmswoman as the acquisitions come rolling in, consolidating alternative risk liability into AT&T's two existing captives as the communications holding company became the largest in the world

AT&T's trust in Gray is noteworthy, considering its diversified brokerage program necessary to accomodate the company's size. To Long, who uses Marsh primarily on the insurance side, the answer is very simple.

"We want a consultant, an advisor and a strategic planner--we' re very large, have very diversified programs and we need that expertise," he says.


"A lot of people talk about customer service and their ability to get things done, but typically they fall short," says Mark B. Falloon, director of insurance and risk management at Dallas-based chemical company Celanese Corp., Falloon. "In my experience with Nancy, she's never missed a deadline and she's never fallen short on a promise or commitment. She's one of the main reasons why we continue to stay with Aon."

According to Cross, Grays starts as one of the leading captive executives in the United States stems from her excellent rapport with big clients like AT&T and Celanese. When a captive manager works on major accounts, her reputation tends to build, and Gray's reputation, Cross says, is second to none.

"A lot of people out there confuse activity with productivity, and she doesn't," says Cross. "The word execution comes to mind. She has a tremendous ability to multitask and still get everything executed."

"I'd clone her if I could," he adds. "I'd have five Nancys if I could."

Gray began her career with a large Boston accounting firm, where she was asked to audit a captive insurance company back in her home turf in the Green Mountain State. "I thought at the time--this was back in the '80s--a captive insurance company, what's that?" she recalls.

The answer to Grays question was very different back then than it would be today. When she moved back home to Vermont in 1989 to break into the captive management arena, Bermuda and Cayman had the lion's share of the captive insurance business. Vermont was a lesser known domicile with less than 100 captives. Domiciles like Arizona, Nevada and South Carolina didn't even exist yet.

"It's changed significantly, very dramatically, in fact," Gray says. "There used to be tax benefits associated with being offshore, and after 1986 those tax reasons really went away. It became more politically correct to be onshore as opposed to offshore."

Gray says it's really been in the last five years that onshore captives have taken off, due in large part to U.S. companies' attention to corporate governance. By the time Gray was promoted to executive director, North America, the title carried more weight than it ever had before. She had to take the reins on figuring out Aon's stake in emerging domiciles, weighing the benefits of involvement from locations as far and wide as Nevada and New York, Montana and Washington, D.C.

"That's one of my challenges," says Gray, "trying to determine where we should have a physical presence."

One of the considerations in determining Aon's presence in any particular captive domicile is the commitment of the state's regulatory environment, which, if lacking, Gray says, means it will be difficult to find long-term success in that domicile.

Another factor Aon considers when entering a domicile is geography. For instance, a West Coast client might look at Nevada or Arizona. South Carolina is attracting many clients from the South and the East Coast, as well as prospects looking to relocate from Bermuda.

But those domiciles represent some of the options available to corporations. Those options seem to be multiplying as time goes on. In Grays estimation, not all will survive.

"I don't think that we can have 50 captive domiciles that will be successful in the long term, if every state decided to pass captive legislation," she says. "I think there is a marketplace for 10 well-established U.S. domiciles."

She knows her stuff when it comes to captives. But even Gray recognizes that, in such a burgeoning business, there can always be more to learn.

Along with other members of the Vermont Captive Insurance Association, Gray was involved in the 2004 creation of the International Center for Captive Insurance Education, a domicile-neutral organization.

She says she was among many folks who recognized the limits of education through typical avenues such as the Risk and Insurance Management Society Inc. and the Insurance Institute of America.

"When I became involved in the insurance industry, I wanted to learn more about it, so I became a CPCU," she says. "And one of the things I recognized was that it was insurance industry focused, but not captive focused."


Gray's enthusiasm to learn and achieve as much as possible is not all that surprising considering the heights she's reached at Aon and in the U.S. captive arena, a corner of an industry primarily operated by men. But she says that while she works in a male-dominated industry, she's been well supported.

"My mentors--whether it was my early days at Ernst & Whinney and currently with some of the leadership at Aon--they're men," she says. "I've been fortunate that the mentors I have had through the years don't view whether you're a man or a woman as being the deciding factor as to whether you' re going to move to the next step."

And, says Cross, Gray is one woman, extremely successful at age 42, who is not even close to reaching what she is capable of.

"I'm not sure I know how anyone really gets to where they do," says Cross. "You don't have to be loud and pushy to get there, because Nancy tends to come across as quiet. If you prove yourself with respect to execution, you're going to get yourself to the top. She's got there very quickly."

Perhaps Gray possesses a certain "Je ne sais quoi," quality her clients and colleagues can't quite nail down but which inspires their loyalty to her. It could have something to do with Cross' characterization of Gray as "quietly stubborn," a dichotomy of being a great listener but not afraid to speak her mind--a positive attribute in a leader, he adds. Long describes his own dichotomy, of Gray as a "consummate professional" but one who occasionally lets her hair down too.

During a recent visit to AT&T's San Antonio headquarters, for example, Gray seemed a bit more conservative than usual, he says, because along for the ride was president and CEO of Aon, Greg Case. Long says he and Gray were walking through AT&T hallways at one point when he began to offer a colorful critique of the modern artwork.

"My commentary was very Southern, like This looks like a hillbilly front porch,' or 'this looks like a trash heap,' and so forth," Long recalls. "I saw a side of Nancy that I had never seen before. She actually laughed and embellished my description of the paintings and went from, 'Well, that's very interesting' to 'You're absolutely right, that's disgusting.' I thought, boy, she has a human side and a great sense of humor as well."

Nancy Gray: cool under pressure, but loose enough to appreciate hillbilly humor.

ERIN FOGG is associate editor of Risk & Insurance[R]. She can be reached at efogg@lrp. com.
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Title Annotation:PROFILE
Author:Fogg, Erin
Publication:Risk & Insurance
Date:Sep 1, 2007
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