No Place Like Insurance For The Holidays!

By Chris Amrhein, AAI

Once again it’s that magical time of the year when we cast away our cares for one glorious month and ponder our many blessings of the past year. This holiday season is no different, and to help you relax and enjoy the season, herewith is our annual recommended holiday reading list for insurance lovers everywhere.

Who Moved My Market? In this cheerful yet wise anecdote on life in the wondrous world of insurance agents, the author tells the tale of two mice who one day awaken to a puzzle – their plentiful soft markets, which have served them well for so many years, have suddenly disappeared. Where once an abundance of markets appeared, now only a few hard scraps remained, and those nearly indigestible. At first our two mice ponder the mystery. Did terrorists steal away their sustenance? After coming to the realization the soft days were gone, the two chose different courses. One quickly laced up his traveling shoes and set off in search of new sources of coverage. The other, still totally puzzled at the sudden shift in the marketplace, decided to sit tight and wait for his markets to return. The author invites you to decide which mouse is more like you, and how would you react to such a crisis? As the one hopes for rescue, the other journeys through a seeming maze of discovery. As he searches, he discovers great truths about insurance markets, and writes them on the wall of the maze for his friend or the industry trade press to discover. These include such insights as: “E&S is where it’s at!” “Reinsurance Rules”; and, of course, “Clients should understand they’ve been getting away with murder on those low premiums!” At last both mice find a happy ending – the first by finding sufficient new markets to survive, and the one who stayed home eventually accepting a buyout offer from a national chain.

The One-Minute Underwriter. A marvelously entertaining and educational tale of a young man, seeking to find the ultimate underwriter, who finds himself introduced to the infamous One-Minute Underwriter. Amazed at the man’s clean desk, confident yet relaxed manner and seeming abundance of free time to share his thoughts and techniques with a young novice, he asks for the secret. His answer? “Anyone can be a One-Minute Underwriter”, offers the One-Minute Underwriter. “Although many study for months and years trying to grasp and master the complexities of the underwriting discipline, it really all comes down to a simple, yet effective technique. Pick up a copy of the current industry trade press. Is the market “soft”? Then the answer to every submission is a simple “Sure, we want it – what price point do you need to win the account?” “But what if the industry pundits claim the market is hard?”, queried the young man. “Even easier,” gently yet firmly replied the One-Minute Underwriter. “Then your answer to every submission is “no, we are no longer interested in that type of business.” “That’s it? Soft means yes and hard means no?”, asked the amazed young man. “That’s it!”, smiled the One-Minute Underwriter. “Wow!” cried the young man. “I want to be a One-Minute Underwriter, too! And I will repay your kindness in sharing your secrets with me by teaching others this marvelous wisdom!” “As you wish’, replied the One-Minute Underwriter, “but if I were you I’d just forget it. My company has already laid off every underwriter but me. But I hear the housing market is doing well, Perhaps you should try and find a ­One-Minute Realtor.”

The Seven Habits of Highly Effective Adjusters. First published nearly twenty years ago, the timeless guidelines of this classic are reaffirmed through their daily usage by adjusters everywhere. How can any adjuster go wrong following such time-tested advice as “Be Proactive – deny the claim quickly”? Or “Begin with the Denial in mind.” Many is the adjuster who, in the depths of depression, has found his or her day brightened by reflecting upon such wisdom as “Seek first to confound, then to obfuscate,” “Claim Intent Comes First” and, of course, “Synergize – define it all as pollution.” Let us not forget the seventh, and my personal favorite, “Sharpen the pencil”, explaining key techniques such as the secrets to paying ACV under replacement cost provisions, and how to find that magic settlement point at which an insured will (often grudgingly) settle for your offer and yet still not call an attorney. Truly timeless! If it has been several years since you absorbed the truths of this classic, reread it today. And buy a few copies to share with your friends. And don’t forget to obtain a copy of the the author’s equally motivational sequel, “Preserving-the-Carrier’s-Principal Centered Adjustership”.

The Texas MoldBillies! (To the tune of the Beverly Hillbillies) Let me tell you all a story of a man named Ted. A middle-class Houston businessman who loved his house and bed. And then one day while he was drinking something cold, his nose started running and he thought “I bet it’s mold!” Black mold. Thick as could be. Well, the next thing you know, old Ted’s a millionaire. Seems they opened up his wall and that mold was everywhere. He sued his insurer, paid his lawyer a fat fee, burned down the house and moved to Beverly. Hills, that is. Right next door to Ed McMahon.

Profit From the Score. No, not credit score. Too passé. This is the explosive true story of a recent breakthrough in underwriting analysis that is certain to drive the insurance world outside the box, across the chasm, all at the speed of thought. You’ll soon find yourself riveted by this unbelievable yet true tale of a small band of rural English teacher/actuaries who, while searching for new computer algorithms in an effort to create even deeper levels of play for Doom, unwittingly unearthed a template for behavior prediction that leaves credit scoring in the dust! Their discovery? Grammar Score underwriting! Amazingly yet uncannily accurate in its ability to predict individual driving experience, the teachers noticed their students who were best able to properly stick to the rules of grammar also seemed to have the best driving records. After nearly two hours of intensive research (involving the pulling of MVRs and matching them to term papers run through Grammatic), they released their findings to a stunned insurance industry. “It seems grammar is an extremely accurate indicator of driving skill”, said Mary Alfred, spokesperson for the teacher/actuary team. “Improper punctuation indicates a tendency to speed. Dangling participial modifiers are clear indicators of collision losses. And improper verb conjugation directly correlates to DUI frequency. We could always tell, for example, that Billy Walker was drunk when he wrote his assigned essays. Talk about abuse of past tense!” One insurance carrier executive reflected the thoughts of many when she stated, “It doesn’t make any sense to me, but it sure seems to work!” Given the inarguable conclusiveness of the findings, within weeks every major insurer had filed to make Grammar Score their key basis for auto coverage underwriting. Soon no one will remember the days when auto coverage could be purchased without submitting a 500-word essay on “Where I drove last summer.” (NOTE: Although at press time several class action suits alleging inherent Grammar Scoring discrimination against groups such as Rednecks are proceeding through the courts, no imminent changes to the new underwriting rules are anticipated.)

Add just one or two of these classics to your reading list. Soon you’ll be amazing your insurance friends at those end-of-the-year insurance festivities with your new-found wisdom. That, plus a few gallons of eggnog, and your holidays are sure to be the best ever. Merry Christmas to all!

December 2002 American Agent & Broker