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In this Benefits Now video, Heather Acerra breaks down important Illinois benefits compliance updates for 2026 in a clear, concise and practical way. HR leaders will gain insight into evolving leave laws, pharmacy benefit regulations, mental health parity requirements, and ACA reporting - with a focus on what matters most and what to review now. Heather Acerra Employee Benefits Sales Executive (309) 335-5586 HAcerra@cottinghambutler.com

On February 3, 2026, the Consolidated Appropriations Act of 2026  (CAA 2026) was signed into law. This expansive federal spending package includes significant reforms impacting Pharmacy Benefit Managers (PBMs). While the full effects of the CAA 2026 won’t be felt until 2029, this new mandate has already shifted pharmacy benefits away from the opaque ‘black box’ model toward one focused on better transparency. The CAA 2026 is part of a wider federal push to increase PBM transparency and lower drug costs. This includes the Department of Labor (DOL) proposed fee disclosure rules, recent FTC enforcement actions regarding insulin pricing, and the recent debut of TrumpRx. Background PBMs are third parties that manage many health plans’ prescription drug benefits.  Health plans often rely on PBMs to process prescription drug claims, design pharmacy networks and negotiate rebates from drug manufacturers. In recent years, the PBM industry has faced growing scrutiny amid questions about lack of pricing transparency and PBM practices, such as retaining a share of manufacturer rebates.  In response, state PBM laws have surged nationwide in the absence of federal regulations.  Applicability of such state laws for ERISA employers has always been questioned.  Now, both Congress and the Executive Branch have provided the launching point of federal regulatory change for the pharmaceutical delivery industry. Key PBM Changes Under the CAA 2026 Include: 100% Rebate Pass-Through : For plan years beginning after August 3, 2028, 100% of rebates, fees and discounts must be remitted to group health plans. Medicare Part D ‘Delinking’ : Beginning in 2028, Medicare Part D will require PBMs to charge a flat service fee instead of taking a portion of the drug’s price. Enhanced Audit Rights : The law strengthens plan sponsor leverage to audit PBM data annually, which will be a critical tool for verifying contractual compliance. Mandatory Transparency Reporting : Detailed reports on prescription drug spending data and formulary rationale. Heightened Fiduciary Oversight : The law clarifies the disclosure obligations for PBMs as service providers, heightening the employer’s fiduciary obligation to assess the reasonableness of all compensation. Why This Matters for Employers The CAA 2026 does not require employers to become pharmacy benefits experts. It does reinforce the expectation that employers work with their brokers and pharmacy partners to ensure transparency and alignment with evolving standards. Employers should expect that: PBM compensation is understood and defensible: Employers should be able to explain how their PBM is paid and what fees are retained. This clear, practical understanding is foundational to fiduciary oversight. Pharmacy spend is being actively managed, not just renewed :   Employers should be able to demonstrate that pharmacy spend is regularly reviewed and that action is taken to manage any waste and inefficiency, with brokers and pharmacy partners supporting this ongoing oversight. Contracts are aligned with market direction : Upcoming renewals are an opportunity to ensure contracts reflect the upcoming phased in expectations around rebate pass-through, fee transparency, and audit rights.  The shift toward fee transparency can be illustrated with a simple example:   Current : A manufacturer paid a $2,000 rebate. The employer would receive $1,700 as the “rebate” while the PBM would retain $300 as a “formulary or administrative fee.” Future : The manufacturer pays a $2,000 rebate. The PBM must pass the full rebate to the plan and will charge bona fide service fees. What Employers Should Do Now While some provisions phase in later, the next one or two PBM renewal cycles are where employers can proactively align their program with future requirements. Employers should work with their broker to ensure a few core areas are in place: Understand how their PBM is compensated : Employers should work with their broker to confirm, at a high level, how their PBM earns revenue, including what compensation flows back to the plan and what is retained for services. The goal is clarity and defensibility, not complexity. Ensure PBM contracts are aligned with CAA transparency standards : As contracts renew, employers should expect their broker to help ensure PBM agreements are aligned with future transparency standards and regulatory requirements. Demonstrate ongoing pharmacy oversight : Employers should be able to point to regular reviews and informed decisions around pharmacy spend, with guidance from their broker and pharmacy partners. Reassess options as new transparency data becomes available : Enhanced reporting helps employers and brokers validate the competitiveness of the current PBM model and explore alternatives when appropriate. How Broker-led Pharmacy Consulting Supports These Expectations PBM contract and financial diagnostics :   Supporting transparency by validating rebate pass-through, service fees, and contractual compliance. PBM RFP and renewal strategy : Helping employers transition from opaque pricing structures to fee-based models that align with emerging regulatory standards. Clinical and cost management programs : Guiding strategies such as specialty management and biosimilar adoption to balance clinical outcomes with cost efficiency. Executive-ready reporting: Providing clear, defensible documentation that supports prudent fiduciary management. A Broader Shift: The Launch of TrumpRx What it is : A prescription price comparison and discount platform for the public that provides consumers with a pathway to view and access lower cash prices at retail pharmacies. What it is not : An employer health plan, a PBM replacement, or a structural reform of employer pharmacy benefits. How it impacts employers : Increases price visibility at the retail level, which may lead to situations where the consumer cash price is lower than the insured rate. This reinforces the broader movement toward transparency without altering employee plan structure. While the mechanics are familiar to employers and brokers who have experience with other prescription discount cards or coupon programs, the key distinction is that TrumpRx discounts are manufacturer-sponsored and tied to specific participation requirements. Looking Ahead While the CAA is now federal law, the specific rules will continue to take shape over the next 18 months. Federal agencies are tasked with defining standards for ‘bona fide service fees’ and formatting for transparency reports. With continuously evolving standards, proactive contract review is an essential part of the enhanced fiduciary oversight.

Nuclear verdicts continue to rise with escalating financial stakes for businesses. In our recent webinar, our claims management experts broke down what's driving massive jury awards and shared proven protective strategies. Through real-world case studies and field-tested approaches, attendees walked away with practical tools and actionable steps to reduce risk exposure and strengthen their defense against nuclear verdict outcomes. Key Takeaways: Are You Prepared?  Establish proactive training programs, comprehensive policies, strategic hiring practices, and a strong safety culture before incidents occur. Are the Right Claim Strategies Implemented? Implement rapid response claim strategies including first call settlements, accident reconstruction, evidence preservation, and thorough investigation techniques. Are Your Drivers Prepared? Ensure drivers are trained on proper accident scene procedures, evidence documentation, law enforcement communication, and immediate reporting protocols. Click here to view the presentation. Additional Resources: Post Accident Preservation Checklist Vehicle Accident Kit Client & Driver Claim Reporting Training Video : The Accident Zone

Discover how Cottingham & Butler helped this family of street and road construction companies achieve a consolidated program with centralized practices to take advantage of the anticipated long-term ROI. Key Wins The Situation One of the largest street and road contractors in the Midwest has historically been operating its entities with full autonomy and completely independently as it pertains to insurance and risk management processes and decisions. There was an apparent opportunity for economies of scale and carrier/program buying power they were not taking advantage of. Why They Needed Change Six commonly owned operating entities were buying six separate insurance programs with 16+ insurance companies and being represented by multiple brokerage firms. Each entity was operating with full autonomy and completely independently of each other. The organization was operating without unified risk management standards, resulting in fragmented philosophies and inconsistent decision-making across business units. Significant inconsistency and opportunity in program structure, coverage forms, limits purchased, retentions, property valuations and more. Safety operations, claims handling, and insurance/contract mechanisms were frequently misaligned, creating both vulnerabilities and strategic opportunities. Anticipated non-renewals on two of the operating entities The Cottingham & Butler Approach Strategic Program & Coverage Optimization Successfully consolidated main Property & Casualty Insurance Programs with 1 insurance company to take advantage of economies of scale and buying power Secured a consolidated large deductible for casualty lines for increased upside savings potential. Secured a $50M+ increase in property coverage limits. Future anticipated long-term cost savings of $2M+ Integrated Safety & Claims Services Contributed to the integration of standardized procedures, programs, and processes. Implemented customized safety trainings and consulting service plan. Implemented centralized claim intake, management, and root cause investigation practices. Negotiated special claims handling procedures with the carrier partner for prioritized claims handling and better outcomes. Implemented ongoing claims advocacy and consulting service plan. Contractual Risk Transfer Identified and corrected numerous vulnerabilities for transferring 3rd party risk. Contributed to bolstering and integrating standardized contractual risk practices and agreements including subcontractor, hired hauler, flagger and temporary staffing agreements. Implemented ongoing contractual risk transfer Ready to maximize your coverage? Contact us today to begin your journey!

The Benefits Brief: Micro-Strategy Sessions  are monthly, 15-minute virtual sessions designed for CFOs, Human Resource, and Benefit Leaders who want fast, actionable insights on employee benefits strategy and healthcare cost management. Each episode delivered expert guidance, emerging trends, and practical takeaways - packed into a concise format that respected your time and sharpened your strategy. Check this series out below! The Hidden Cost Lever - Rethinking Health Plan Eligibility: 8/6/25 Click here to view the presentation. Beyond the Plan: Exploring Alternatives That Benefit Members and the Bottom Line - 9/2/25 Click here to view the presentation. Health Plan Mastery: Regain Control, Reduce Costs - 10/7/25 Click here to view the presntation. Beyond the Script: Managing the True Drivers of Pharmacy Costs - 11/4/25 Click here to view the presentation. The Care Traffic Controller: Directing Patients to High-Value, Low-Cost Healthcare - 12/2/25 Click here to view the presentation. Captives and the Cost of Certainty - 1/26/2026 Click here to view the presentation. BJ McAndrew BMcAndrew@cottinghambutler.com 608.228.6055

Written by: Chris Loewenberg, Vice President - NSTD For small fleet operators, the insurance landscape has become increasingly challenging. Trucking auto liability premiums have surged by 36 percent per mile over the past eight years, according to the American Transportation Research Institute (ATRI), putting significant financial pressure on carriers - especially those with limited resources to absorb these increases. Last year, insurance cost and availability ranked as the third-greatest issue facing the trucking industry, with lawsuit abuse, a primary driver of rising insurance costs, coming in at number two. As we move through 2026, small fleets continue to face difficult choices: reducing coverage to lower premiums but increasing exposure to catastrophic loss, raising deductibles to shift more risk onto the business, or maintaining comprehensive coverage while absorbing premium increases that impact profitability. While no single strategy can stop premiums from rising, there are practical steps small fleets can take to reduce volatility and improve how they're viewed by insurance carriers. Turn Safety Technology into Real Insurance Value Simply having technology like ELDs, telematics, or dash cameras isn't what drives insurance results. What matters to underwriters is the trend of the data and how you're using it to improve over time. Underwriters focus on whether your fleet can demonstrate improvement - reduced speeding, better hours-of-service compliance, or documented driver coaching after incidents. Fleets that actively review data, address issues, and take corrective action are viewed as more stable and predictable risks. Technology creates insurance value when it supports better decision-making and safer operations - not just when it exists. Work With Insurance Partners Who Understand Trucking Trucking insurance is highly specialized, and small changes in operations, equipment, or contracts can create coverage gaps if they aren't properly addressed. Working with insurance professionals who understand the nuances of trucking - coverage triggers, exclusions, cargo requirements, and contract obligations - helps ensure policies remain aligned with how your fleet operates. This expertise extends to everyday items often overlooked, like certificates of insurance. Knowing when a certificate is truly required, what language matters, and how quickly it needs to be issued can prevent delays, contractual issues, or uncovered exposures. Fleets that build long-term relationships with knowledgeable advisors benefit from continuity, better guidance through market changes, and fewer surprises at renewal or claim time. Use Partnerships and Resources to Reduce Total Risk Insurance costs extend beyond the policy itself. Small fleets can benefit from partnerships and resources that help reduce overall risk: Fuel discount programs that help manage operating expenses Access to excess cargo or specialty coverage when freight changes Safety and training resources focused on common claim drivers Guidance on understanding SMS scores rather than just reacting to them Used correctly, these tools help fleets operate more defensively and avoid surprises that can negatively impact insurance outcomes. Actionable Steps for Small Fleet Operators While market conditions remain challenging, small fleets can take meaningful steps to improve stability: Focus on safety trends and documented improvement, not just compliance Use technology as a management tool, not just a requirement Build relationships with insurance partners who understand trucking-specific risks Treat insurance decisions as part of a long-term strategy, not a yearly transaction Take advantage of resources that reduce total cost of risk beyond the policy itself Rising insurance costs may be unavoidable, but volatility and surprise don't have to be. Fleets that take a disciplined, informed approach to risk management are better positioned to weather the storm and build long-term stability.

Employers subject to Affordable Care Act (ACA) reporting under Internal Revenue Code Sections 6055 or 6056 should prepare to comply with reporting deadlines in early 2026. This guide provides comprehensive information on deadlines, covered employers, reporting requirements, and penalties for the 2025 calendar year. Key Deadlines for 2026 For the 2025 calendar year, covered employers must: File Returns with the IRS: March 31, 2026 (electronic filing required for employers filing at least 10 returns during the calendar year) Post Website Notice or Furnish Statements: March 2, 2026 Post a clear, conspicuous, and easily accessible notice on their websites informing individuals that they may request a copy of Forms 1095-B or 1095-C The notice must be retained until October 15, 2026 Statements must be furnished to requesting individuals by the later of January 31, 2026, or 30 days after the date of the request Alternative: Instead of posting the notice online, reporting entities may provide Forms 1095-B or 1095-C directly to individuals by March 2, 2026. Who Must Report The following employers are subject to ACA reporting: Employers with self-insured health plans (Section 6055 reporting) Applicable Large Employers (ALEs) with either fully insured or self-insured health plans (Section 6056 reporting) ALEs are employers with 50 or more full-time employees  (including full-time equivalent employees) during the preceding calendar year. Important: ALEs with self-funded plans are required to comply with both Section 6055 and Section 6056 reporting obligations. However, the IRS allows these employers to use a single combined form (Forms 1094-C and 1095-C) to simplify the reporting process. Understanding Section 6055 and 6056 Reporting Section 6055 Reporting Section 6055 applies to providers of minimum essential coverage (MEC), such as health insurance issuers and employers with self-insured health plans. These entities use Forms 1094-B and 1095-B  to report information about the coverage they provided during the previous year. Section 6056 Reporting Section 6056 applies to ALEs—generally, those employers with 50 or more full-time employees, including full-time equivalents, in the previous year. ALEs use Forms 1094-C and 1095-C  to report information relating to the health coverage that they offer (or do not offer) to their full-time employees. Combined Reporting Employers reporting under both Sections 6055 and 6056—specifically, ALEs with self-insured plans—use a combined reporting method by filing Forms 1094-C and 1095-C. Reporting Deadlines by Employer Type Action Fully Insured ALEs Self-insured ALEs Self-insured Non-ALEs File Forms 1094-C and 1095-C with IRS March 31, 2026 March 31, 2026 N/A File Forms 1094-B and 1095-B with IRS N/A May use combined C forms OR B forms March 31, 2026 Provide Forms 1095-C to employees Upon request after March 2, 2026 website notice* Upon request after March 2, 2026 website notice* N/A *Alternative: Reporting entities may automatically furnish statements directly to individuals by March 2, 2026, instead of posting a website notice. Website notices must be retained until October 15, 2026. Requests must be fulfilled by the later of January 31, 2026, or 30 days after the request date. Filing Extensions Employers may receive an automatic 30-day extension  to file with the IRS by completing and filing Form 8809 by the due date of the return. Additional extensions of time to file may also be available under certain hardship conditions. Electronic Filing Requirements Filing Threshold: Employers that file at least 10 returns  during the calendar year must file electronically. Key Points: The 10-or-more requirement applies in the aggregate to certain information returns (Forms W-2, 1099, 1094, 1095, etc.) Electronic filing is done using the ACA Information Returns (AIR) Program The electronic filing requirement does not apply to employers that request and receive a hardship waiver When filing electronically, follow the formatting in the 'XML Schemas' and 'Business Rules' published on IRS.gov rather than paper return formatting Penalties for Non-Compliance A reporting entity that fails to comply with ACA reporting requirements may be subject to penalties under Code Section 6721 (failure to file correct information returns) and Code Section 6722 (failure to furnish correct payee statements). However, penalties may be waived if the failure is due to reasonable cause and not willful neglect. Penalties may also be reduced if the reporting entity corrects the failure within a certain period. 2026 Penalty Amounts (for 2025 Returns) Penalty Type Per Violation Annual Maximum Annual Maximum (Small Employers*) General $340 $4,098,500 $1,366,000 Corrected Within 30 Days $60 $683,000 $239,000 Corrected After 30 Days and Before Aug. 1 $130 $2,049,000 $683,000 Intentional Disregard $680 No limit No limit *Small employers are defined as those with average annual gross receipts of up to $5 million for the three most recent taxable years. How Cottingham & Butler Can Help Navigating ACA reporting requirements can be complex and time-consuming. Cottingham & Butler has the below support to ensure your organization remains compliant while minimizing administrative burden. Our ACA Reporting Services Include: Compliance Assessment:  We evaluate your current reporting status and identify your specific obligations under Sections 6055 and 6056 Penalty Risk Mitigation : Proactive review and error-checking to help avoid costly penalties ESRP 226J Penalty Appeal : In the event the IRS issues a penalty, our team of ACA experts can assist in drafting a response to appeal the penalty Ongoing Compliance Guidance : Year-round support to help you stay ahead of regulatory changes and maintain compliant practices Form Preparation & Electronic Filing (Additional Cost) : Professional preparation   of Forms 1094 and 1095 with electronic submission through the IRS AIR Program   Contact your Cottingham & Butler account team to discuss how we can support your ACA reporting needs for 2026 and beyond. This document is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice. Information is current as of January 2026.

As cyberattacks become more frequent and costly, it's crucial for organizations to maximize their financial protection against related losses by purchasing sufficient insurance. Cyber coverage, also known as cyber liability insurance, can help organizations pay for a range of expenses that may result from cyber incidents - including, but not limited to, data breaches, ransomware attacks and phishing scams. The Growing Cyber Threat Landscape The statistics paint a sobering picture of today's cyber risk environment: These numbers underscore the critical importance of comprehensive cyber insurance protection for organizations of all sizes. Two Types of Coverage Cyber insurance typically falls into two categories: first-party coverage - for your direct losses, and third-party coverage - for liability to others. First-Party Coverage First-party coverage protects your organization from direct losses, including: Incident Response Costs: IT forensics, system restoration, customer notifications and call center services Legal Costs: Legal counsel for notification and regulatory obligations Data Recovery: Reconstituting deleted or corrupted data Business Interruption: Lost profits and additional costs from system downtime Cyber Extortion: Response specialists and ransom negotiation Reputational Damage: Crisis management and public relations services Third-Party Coverage Third-party coverage protects against claims, fines and legal action from others: Data Privacy Liability: Costs from third-party lawsuits, credit-watch services and compensation for compromised information Regulatory Defense: Fines, penalties and defense costs from regulatory action or privacy law violations Media Liability: Defense costs and damages from defamation, libel, slander and intellectual property infringement claims How Cottingham & Butler Can Help The cyber insurance marketplace is complex and rapidly evolving. Our team brings deep expertise in cyber risk assessment and insurance placement to help you navigate this challenging landscape. Risk Assessment and Coverage Analysis : We evaluate your cyber risk profile, identify exposures and coverage gaps, and work with your IT teams to understand your unique risk landscape. Market Access and Carrier Relationships : We maintain strong relationships with leading cyber insurance carriers to secure optimal terms and pricing. Claims Advocacy and Support : We provide dedicated claims support to expedite the process and coordinate with approved vendors to minimize business disruption. Ongoing Risk Management : We offer regular coverage reviews, emerging threat briefings and recommendations as your organization grows and changes. Cyber insurance can make all the difference in helping organizations avoid large-scale financial losses. Cottingham & Butler is dedicated to helping you understand your cyber exposures, navigate the insurance marketplace and implement comprehensive protection strategies. Questions?

If you're feeling like your organization is juggling more challenges than ever before, you're not alone. A recent State of the Market Survey of over 1,000 employers confirms what many leaders are experiencing . The good news? While these challenges are real, they're also predictable and manageable with the right strategies. Here are the critical issues shaping the employer landscape this year - and how forward-thinking organizations are turning obstacles into advantages. Economic Uncertainty: Inflation & Rising Healthcare Costs Nearly 60% of employers cite economic uncertainty as their primary challenge, driven by policy shifts from the new administration, ongoing inflation concerns, tariffs affecting supply chains, and sector-specific layoffs. With 64% of employers struggling with inflation and 42% facing rising healthcare costs, organizations are grappling with anticipated 7-8% healthcare cost increases. Resources and Tools: 5 Proven Strategies Every Employer Needs to Know  - How to cut Healthcare costs by up 30%.  We've compiled five of the most impactful considerations your company can make to save on health coverage costs while providing exceptional benefits plans for your employees. Case Study: Cost Containment Through Alignment and Transparency  - As a certified Great Place to Work®, J. J. Keller & Associates, Inc. is committed to providing high-quality, affordable healthcare for their 1,800 associates and their families by employing smart healthcare consumerism strategies that create win-win solutions and reduce the increasing healthcare burden on employees while ensuring they receive the medical care they need. 10 Ways to Reduce Healthcare Costs  - In this session, we share 10 proven strategies that can help you reduce healthcare expenses without driving away your top talent. Compliance Challenges Are Growing Over 26% of employers struggle with evolving federal and state regulations, including employment law changes, increased agency enforcement, and shifting DEI policies. Resources and Tools: How to Navigate State Compliance Regulations  – Brett McKitrick highlights the growing challenges of HR compliance as states increasingly pass complex legislation. Executive Order Aims to Reduce Prescription Drug Costs  - On May 12, President Donald Trump issued an executive order  (EO) that aims to bring the prices Americans pay for prescription drugs in line with those paid by similar nations. How does this impact you? Monthly Compliance Webinar on Compliance Hot Topics  – Use this link to register for upcoming hot topic compliance webinars to stay in the know.  Attraction and Retention Challenges Persist Nearly 60% of employers continue to face talent attraction and retention issues, implementing strategies focused on engagement, compensation, development, and skills-based hiring. Resources and Tools: Critical Role of Compensation in the Recruitment Process  - In today's competitive market, a well-designed compensation strategy is no longer optional, it's essential for attracting top talent and reducing costly turnover. What Employees Want  - From rising compensation expectations to evolving benefit needs, creating an effective total rewards strategy has never been more challenging - or more crucial for your success. Innovative Survey Tool that Transforms Traditional Employee Feedback  - Employers often assume they understand what employees want, but do they truly grasp how satisfied employees are with their benefits packages?   Strategic Workforce Planning Is Essential With 76% of employers actively hiring and most maintaining optimistic hiring plans, organizations are aligning workforce strategies with long-term business goals. Resources and Tools: Employee Benefit Benchmark Reports  - Use our industry specific benchmark reports to give you detailed insights into what other companies in your industry are offering, helping you design a benefits program that attracts top talent without overspending. Empowering Employers in attracting talent  - Maximize employee value and satisfaction with a strategic Total Rewards approach. Benefits & Strategic Communication  - We recognize the pivotal role that communication plays in shaping the employee experience. Our approach is centered around designing and implementing effective benefit communication strategies and materials that not only inform but also empower employees to make educated decisions about their benefits. Moving Forward Together The market presents complex challenges, but organizations that stay informed, focus on strategic planning, and remain agile will thrive. Cottingham & Butler's comprehensive approach addresses each of these critical areas, providing you with the expertise, resources, and innovative solutions needed to navigate uncertainty and position your organization for long-term success. Ready to tackle these challenges head-on?  Contact your Cottingham & Butler team today to discuss how we can help you turn market challenges into competitive advantages.

Our recent webinar, "Cross-Border Safety: Strengthening ELP Standards and CDL Integrity," brought together SMSC Senior Safety Consultant Kara Vines and Belinda Garcia, a retired training and development specialist with the Texas Highway Patrol, to address critical updates to English language proficiency (ELP) requirements for commercial drivers. Whether your fleet operates across state lines or manages drivers from foreign-based carriers, this session delivered practical guidance to strengthen hiring practices and maintain compliance with the new enforcement standards. Missed the live session? View the recording to access these essential insights. Key Takeaways: ELP is now an out-of-service violation — As of June 25, 2025, drivers who can't communicate sufficiently in English will be placed OOS during roadside inspections, with no translation apps or interpreters allowed during assessment. Two-step roadside assessment process — Inspectors will evaluate drivers through verbal interaction and U.S. highway sign comprehension, with failed assessments resulting in immediate OOS placement regardless of where the driver is based. Texas intrastate operations face unique risk — Texas has resisted enforcing the federal ELP rule for intrastate CDLs, creating compliance uncertainty for carriers operating within the state. Enforcements apply to all drivers operating in the U.S., including foreign-based carriers. Click here to view the presentation.

For over 138 years, we've operated on a simple belief: take care of our clients, invest in our colleagues, and good things will follow. That philosophy has guided us from our start as a small main street shop to becoming the third largest privately and independently held insurance broker in the United States. Now, we're adding a new chapter to that story. We're excited to announce that Mike Hessling has joined Cottingham & Butler as President, effective January 19, 2026. Mike’s appointment reflects our commitment to our bright future while staying true to the values that got us here. Mike Hessling President Building on Momentum Over the last few decades, we've had the privilege of serving more clients in more ways than ever before – and we see even more opportunity ahead. Adding a President gives us the capacity to go after it. Mike will partner with CEO David Becker to develop and execute our strategic agenda, with a focus on continued growth and long-term planning. He joins an already strong leadership team, and our people will keep doing what they do best - delivering for our clients. Cottingham & Butler has been family-owned and independent since its founding in 1887, something that's increasingly rare in an industry marked by consolidation. For the Butler family and the over 1,400 passionate professionals, that independence isn’t just a tradition; it’s the foundation of how we serve our clients Better Every Day. "What I love about our business is we make decisions that are right for our clients, our employees, and the long-term future of this company," said Andrew Butler, Executive Chairman. "Mike understands that, and it's part of what makes this such a good fit – for him and for us. We're excited about what's ahead."   The Right Leader at the Right Time Mike joins us from Gallagher Bassett, where he spent over 12 years and rose to CEO of North America. In that role, he led a $1B+ claims operation and a team of more than 3,000 professionals, delivering consistent organic growth year after year. But it wasn't just the numbers that caught our attention – it was how he achieved them. "We've built something special at Cottingham & Butler and adding Mike positions us to build on that momentum," said CEO David Becker. "His track record speaks for itself, but what impressed us most was how he's built his success – taking care of clients, developing people, and running a disciplined operation. Those are the same things we prioritize here at C&B." Mike brings a diverse background to the role. He started his career at Arthur Andersen, then spent years in management consulting at Bridge Strategy Group and Bain & Company before joining Gallagher Bassett in 2012, bringing both strategic perspective and operational expertise to his work. He holds an MBA from Northwestern University's Kellogg School of Management and a BS in Accounting from Penn State. He's a CPA who scored in the top 1% in Illinois on the exam. He's been recognized on the Insurance Business Global 100 list three times and received the Business Insurance Break-Out Award in 2017, which honors the next generation of industry leaders. Beyond business, Mike founded and chaired Gallagher Bassett's Inclusion & Diversity initiative and serves on the board of Youth Outreach Services in Chicago. He and his wife Val are the proud parents of eight children and are relocating to Dubuque from the Chicago area  – we're excited to welcome them to our community.   A Shared Vision For Mike, the decision to leave a successful tenure at Gallagher Bassett came down to something harder to quantify than revenue or growth targets. "I've admired Cottingham & Butler from afar for years – the culture, the client focus, and the way they take care of their people," he said. "I'm excited to join this team and help build on what's already a tremendous foundation." It's a sentiment that resonates with C&B's leadership. In a market where service and quality matter more than ever, Cottingham & Butler has carved out a distinctive and stellar reputation – one that Hessling says he's eager to be part of. "This is an investment in our future," Becker said. "We want to make sure we have the leadership in place to pursue new opportunities while never losing sight of what matters most – taking care of our clients and building great careers for our people."

Written by: Cottingham & Butler Food & Agribusiness Group A Moment to Reflect Before We Look Ahead As 2025 drew to a close, many of us pause to take stock - of what worked, what changed, and what lies ahead. For risk managers and insurance buyers, this reflection is more than tradition, its strategy. The property insurance market has shifted dramatically over the past two years and understanding where it’s headed in 2026 is critical for setting goals, budgets, and expectations.  With softening trends accelerating, admitted and non-admitted markets colliding, and coverage terms evolving, now is the time to ask:  Will the E&S market plateau - or continue to soften? And how should you position to capture the upside while protecting against volatility?   What’s behind the softening?   Capacity Surge:  New entrants and returning carriers have boosted competition, driving down rates and improving terms. In many placements it’s typical to see oversubscription of 50-70% on individual layers, a clear signal that markets are eager to deploy capital.   Reinsurance Relief:   After historically tough 1/1 renewals in 2023, risk adjusted property CAT rates fell in January and midyear 2025 (loss free programs down ~10–15%; higher layers down up to ~20%), with strong ILS participation and healthy retained earnings driving supply. That relief has trickled down to primary property pricing and terms.   Profitability:  While catastrophe (CAT) losses remain elevated, industry capital levels are strong. 2024 ranked as the third-costliest year for natural catastrophes, with losses approaching $140 billion. For 2025, natural-catastrophe losses are projected to decline by approximately 13–24%. Reinsurers and markets closed out 2025 with robust capital positions and higher attachment points, reinforcing overall resilience. This strength is expected to support continued market softening - barring the occurrence of an extreme peak-loss event.    Bottom line:  The E&S property market is not likely to reharden broadly in 2026 without a severe, capital eroding catastrophe. We expect continued softening/plateau characteristics: modest rate decreases, expanding capacity, and better terms.  Where are the improvements?   Deductibles:  In 2025, many insureds capitalized on favorable market conditions to secure lower deductibles. During the hard market cycle from 2017 to early 2024, deductible levels often climbed to uncomfortable thresholds, shifting more risk retention onto buyers. As competition intensified, carriers were compelled to offer reduced deductible options with minimal impact on overall pricing - reflecting the depth of current market flexibility.  Limit Correction:  Many insureds are leveraging today’s competitive market to reinvest savings into higher limits. During the hard cycle of 2017 to early 2024, buyers often reduced total limits - driven by cost pressures or limited capacity. With abundant supply and improved pricing, organizations are now restoring or expanding limits to strengthen balance sheet protection and meet lender or contractual requirements.  Terms & conditions:  As competition intensifies, markets are offering enhancements to differentiate themselves. Buyers are seeing “blanket” coverage   reinstated, removal of restrictive endorsements such as Occurrence Limit of Liability (OLLE), higher margin clauses, and increased sublimits for critical exposures. These improvements reflect carriers’ willingness to provide broader protection as part of their competitive strategy.  Admitted vs. Non-Admitted Collide   Converging economics.  As E&S softens (rate, deductibles, broader terms), some admitted carriers  still push rate for technical adequacy . The result: both channels now  compete head-to-head  on price and form in segments that have been historically dominated by the admitted marketplace.    Scale and Share.  E&S now represents  a much larger slice of commercial lines  than a decade ago; NAIC/AM Best data show a sustained shift of complex property risks to non-admitted carriers - especially in FL/CA/LA. As admitted appetite expands in select niches, the contest will be won on  form, price, capacity, and engineering cred , not just license status.     Strategies for Insureds in a Softening Cycle    1) Double down on Risk Engineering.  The best price cuts and coverage offerings are going to data rich, engineered facilities with credible valuations, CAT hardening (roof, defensible space, flood measures), and maintenance discipline. Underwriters are rewarding evidence, not anecdotes.     2) Treat valuations as a competitive weapon.  Accurate valuations (cost/sq ft) and modern cost indices unlock broader blanket limits and reduce margin clause friction.     3) Revisit Program Structure . Take advantage of larger participation from competitive carriers and cleaner tower structures. Look to explore higher limits, lower deductibles, all while achieving modest rate reductions.     4) Push Non-Admitted vs Admitted Options.  Admitted vs. E&S is no longer a foregone conclusion for some sectors of the Food/Ag industry.  In 2026, lead with whichever channel wins on economics + form + engineering support, not label. Expect side-by-side options and a structured recommendation.    5) Invest in Relationships - Domestic and Overseas.  Reinsurer appetite and London/Bermuda capacity are relationship sensitive. Consistent submissions, technical calls, and plant tours with underwriting and engineering teams generate durable concessions (limits, terms, perils) that outlast a single renewal cycle.    Closing Thoughts:    The property insurance market has shifted dramatically - and opportunities like this don’t last. For nearly six years, buyers absorbed higher deductibles, trimmed limits, and accepted restrictive terms because there was no alternative. Today, the pendulum has swung. Capacity is plentiful, coverage is broadening, and markets are competing to win your business.    The question isn’t “Will the market stay soft?” - it’s “Are you positioned to take advantage before it changes again?”    Every renewal is a chance to reset your strategy:  Could you restore limits cut during the hard cycle?  Reduce deductibles without adding cost?  Secure blanket coverage and remove restrictive endorsements?  These aren’t hypothetical - they’re happening now for those who act. Waiting means leaving value on the table and risking being caught when the cycle turns.