Insurance meetings were among the hardest hit two years ago, but now things are looking up for industry planners, destinations and venues.
"We experienced a 13 percent increase in insurance bookings in 2010 over 2009," says Hal L. Powell Jr., regional vice president, sales and marketing for Benchmark Hospitality International, based in The Woodlands, Texas. "It appears that 2011 will be somewhat stronger than 2010."
At the Greater Columbus Convention Center in Columbus, Ohio, Senior Director of Sales Sherry Chambers sees improvement in the market, but not nearly as many bookings as a few years ago.
"In 2007, we probably had 50 or more insurance conferences," she says. "That number dropped to maybe a handful in 2009. In 2010, we were back in the 10-to 12-meeting range. I do anticipate a couple dozen meetings will come back in 2011, which is a good sign."
This upswing hasn’t been felt across the board. At Nemacolin Woodlands Resort in Farmington, Pa., Dennis Noonan, vice president, sales and marketing, reports lagging bookings.
"We are not seeing a huge comeback in the insurance market right now; it is still down," he says.
Like Chambers, Noonan longs for the days of the past.
"We are dying to see the insurance market open up again," he says. "Back in 2006 and 2007, we were probably bringing in about 2,500 insurance room nights per year at high-end, luxury levels. Right now, we are sitting at about 40 percent of those levels."
Perception issues
The infamous AIG meeting of late 2008 led to massive perception fallout across the meetings market. Two years later, the press has moved on and companies are again looking at resort properties, says Steve Bova, executive director for Financial & Insurance Conference Planners (FICP), based in Chicago.
"Insurance companies are still conscious of the perception of meetings they are holding, but they also feel that some scrutiny has been lifted," he says.
Gus Vonderheide, vice president of group sales for Hyatt Hotels & Resorts, also based in Chicago, agrees.
"We are seeing less issues relating to perception," he says. "That said, it is still playing a role in the choice of a destination for some planners. In the past, going to a warm weather destination may have been an automatic decision. Today, they are thinking twice."
Although issues may have lessened, some resorts are still hurting.
"There is still a little bit of fear going back to AIG," Noonan says. "People are still running a little low and staying under the radar with high-end resort programs. While the economy is starting to move, it is moving slowly."
Meeting Details
While insurance meetings and incentive meetings usually go hand-in-hand, times have changed the group gathering landscape.
"When I started more than five years ago, we were doing primarily incentive meetings; I don’t remember doing any regular business meetings," says Eldon Gale, director, meeting and event management group for Nationwide Insurance, based in Columbus, Ohio. "Fast forward to 2009, when the floor fell out of the economy, and we were cancelling almost every incentive."
Gale and his team focused almost exclusively on business meetings throughout 2009 and in early 2010, but soon realized the effect of such a shift.
"Our agents were not as engaged; we weren’t giving them the motivation they found with incentive travel," he says.
In 2010, the company started combining business and incentive meetings, according to Gale.
Looking ahead, Gale sees incentives in the near future.
"I am planning for 2012 right now and we are looking at international incentives," he says. "We are back to travelling."
The company is also planning to send business meetings to attractive destinations.
"In 2009, we localized things a lot and kept them in Columbus, which had a lot to do with perception," Gale says. "If you took your team to a business meeting in Phoenix or Las Vegas, it would raise eyebrows, but if you met in January in Columbus, no one would ask questions.
"Now we are looking more at warmer destinations," he continues. "Our executives don’t want sales conferences to be perceived as punishment for not hitting numbers. We are not looking into resort-y locations, but definitely warm weather places."
At Nemacolin, Noonan isn’t yet seeing a rise of incentive meetings and instead is getting calls from local insurance offices for management and strategy meetings.
"We are lacking in incentive meetings, but seeing management and strategy meetings in the insurance sector," Noonan says. "The meetings are not even regional, just local; I am not seeing a lot of reach out from big, national insurance companies."
How large are insurance meetings these days? The answers depend on whom you ask.
"Our insurance meetings are smaller in scope," Noonan says. "Back in 2006 and 2007, we were seeing 150-room programs. Now we are seeing 10-to 20-room meetings."
Over at Nationwide, Gale sees something different.
"Our meetings have increased in size and decreased in frequency," he says.
At the Greater Columbus Convention Center, Chambers sees the same trend as Gale.
"With our insurance meetings, we’ve noticed the number of people have increased, but the events are not as extravagant as they once had been," she says.
How long are lead times for insurance meetings?
"Today, a piece of business might come in within 30 days or less of the event date," says Hyatt’s Vonderheide.
Chambers agrees.
"In the last six months, I’ve seen insurance companies and associations planning events from one week to two months out," she says. "Lead times are incredibly short these days."
Planner concerns
According to Vonderheide, insurance planners are more cost-conscious than ever before.
"Insurance meeting planners are looking for a great value," he says. "Attrition and cancellation clauses are always a topic of conversation. They want to make sure they are signing smart contracts."
Budget concerns are leading to longer contract negotiations, Powell says.
"Our insurance clients want to negotiate everything up front," he says. "Unlike in the past when they wanted just the room rate and then would figure everything else out later, now they want to know the total cost of the meeting. Planners are interested in the cost of rooms, food and beverage, transportation from the airport and so on, so they can get a handle on the total price. They are more detailed then ever."
Price negotiations can be tough on resort properties, according to Noonan.
"I don’t mind negotiating, but when you go too far, you don’t get it back," he says. "If you start giving things away, what are you telling your clients who are paying normal rates? I think there is a risk there."
Deals are good news for planners.
"We are starting to be more strategic in booking meetings long- term to gain multiple-year contracts with the same hotel," Nationwide’s Gale says. "There are still good prices out there to be had. I am trying to move as fast as I can in a buyer’s market with the understanding that things could change."
Future Forecast
What does the future hold for the insurance meetings market?
"Meetings are coming back," Nationwide’s Gale says. "Things may not be as busy in 2011 as in 2007, but that has a lot to do with the planning cycle, which in some cases is 18 to 24 months out.
"Now we are booking, so two years from now will look pretty good."
Although the economy hasn’t been kind to resorts, Nemacolin’s Noonan is optimistic, with a hint of caution.
"I am confident we will see the insurance market come back," he says. "Some of our old reliables are poking their heads up and looking around, which is a good sign. Even so, I’m not ready to blow the trumpets quite yet."
Katie Morell (www.katiemorell.com) is a Chicago-based freelance writer and former Meetings Focus editor.
