Getting to know clients.

In this issue in the Insurance Advocate we pose the simple one word question “Ready?” We refer here to the lessons of Super Storm Sandy and to the prospect in the future of an industry’s preparedness in the wake of it. We present testimony of Ron Papa before the N.A.I.C., which has many searching ideas in it. In addition, in two side bars we have, first, the Casualty Actuarial Society’s overview of flood insurance and, second, assurance from I.I.I. in a separate side bar that the industry is ready. We have come to know the kind of responsible cooperation that FEMA, the Red Cross, police department, fire department, city, and other entities including the insurance industry shared during the remarkable set of events that followed the super storm. Actually, in each case there is reason to be proud of the performance. The DFS, as we report in these pages, was on the scene almost ubiquitously, even to the point where members of the staff dressed in casual clothes so they could be out on the scene on the hardest hit areas. We commend them…While many insurance companies gather extensive data about their clients, about 57% report they are missing revenue opportunities due to a lack of insight, so reports a study recently shared with the Insurance Advocate. This particular finding, from a recent Customer Experience Diagnostic survey conducted by management and technology consulting firm West Monroe Partners, highlights an industry knowledge gap concerning the handling of customer data and the role it plays in business decisions. West Monroe found that 43% of insurance companies are “unable to estimate the cost of acquiring a new client”, while close to half don’t calculate “customers’ lifetime value”. This uncertainty is costly to insurance companies, undermining their ability to strategically allocate resources, nurture customer relationships and run effective outreach campaigns, the company observes. For agents, the retention support would be a solid advantage versus some direct writing competitors. We are reviewing it further for possible reproduction in these pages… I continue to be amazed at the careful and thoughtful approach taken by Jerry Trupin in analyzing issues facing agents as they conduct business on behalf of their clients. Jerry takes a very careful approach this week to the matter of secondary dependent properties, cancellation of liability and a New York WC split point change. Please be sure to read him and the other columnist who enrich our pages with every issue.