Insurance Reasoning / Spill-over
Insurance Reasoning / Spill-over
There is a new subject in Economics that is taking the country by storm. It’s called ObamaMath. It starts with the addition of 7 million people together with the subtraction of 5 million people to determine the success of an ill conceived equation. Right. 7 million sign ups, but 5 million dropped. Unsure number who have paid premiums. Unsure number of young buyers, i.e. paying clients. Readers of the Insurance Advocate understand insurance math and errors in risk financing that are cornerstone concepts in the business of insuring, from adverse selection to the law of big numbers and cash flow underwriting. I cannot imagine that there is an insurance professional in the solar system who would not be worried about ObamaMath and its relationship to other aspects of insuring. Our cover story from the March 17th issue was devoted to the spill-over effect of healthcare on the property and casualty business and other aspects of ensuring. Our viewpoint here, despite obvious appearances, is not a partisan one. We believe it is a common sense viewpoint that invokes insuring logic tin he face of political and ideological partisanship. We will continue to run articles on ObamaCare and ObamaMath, its effects on insuring and on medical professionals. Many of you have enjoyed the guest articles we have run from medical doctors who are deeply concerned over the integrity of their profession and who focus more upon the provision of care than the distribution of cost, but most of whom find the shockwaves of ObamaCare to have undone the delicate balance in the medical delivery system… In this issue, we continue our series of searching articles on megatrends that affect insurers, in this case regulatory, filing and other compliance aspects. The insurance industry has no shortage of survey results and enterprises interested in influencing the practice of insurance for the better, even if the near-term goal is the generation of business for a law firm or a consultant firm. The materials produced and presented here do not lack objectivity. We welcome your comments on these trends and perhaps some suggestions as to the means of addressing them… Frank Rich is an excellent writer and thinker on subjects that affect the conduct the business. In one of his recent articles, from a series called ROI, he observes that there is a great difference between being interested in some and being committed to it. He uses that to distinguish better and worse entrepreneurs’ approaches to operating businesses and, more pointedly, to the conduct of staff members who come to work, in some cases, with no more than their lunch bag. Frank’s advice to business owners is clear: imply commitment, not merely interest at all times. If there is a subject that is of no more than passing interest, distinguish it as a hobby or a back burner item and do not let it get confused with the business to which successful entrepreneurs are almost blindly committed.… Speaking of commitment, this issue includes several articles and photos of individuals who “step up” and make themselves heard as leaders of the independent agents and local associations, in this case the Suffolk County IIAB. See page 32.… In addition, we are proud to feature a great program run by PRI to enhance risk management education and the use of latest techniques for controlling exposure. Story and photos on page 12.… The volunteer sector has always had individuals who have distinguished themselves by setting high standards for the associations and companies with which they are connected. It is interesting to read this issue’s installment of “Looking Back” which revisits a policy statement of the IIAB that came out 25 years ago. With some amendments and updating, it is still relevant to today’s need for confidence in the property-casualty insurance business. It is worth a read. Interestingly, an individual who was among the architects of this document is Mr. Jeff Yates, former IIAA chief executive, who has just retired from service. Jeff, like so many of his peers in the IIAA and in other trade associations, has served the industry faithfully, well beyond the simple carrying out of their duties. The scope of the task is often as large as the scope of this policy statement may 25 years ago. Leaders of the independent insurance agents and professional insurance agents associations are left to deal, when the volunteers go back to work in their offices, with the broad issues of sustaining credibility for the system they represent. We admired them. Jeff Yates deserves our applause and thanks.
