How Active Assailant Insurance Can Help Your Business Survive after a Mass Casualty Event

Co-authored by Chantal Roberts, CPCU, AIC, RPA

Are those firecrackers? Is a car backfiring? Perhaps there’s a disturbance of some kind. Today’s managers and owners rarely consider if an active shooter incident can occur on their property. Unfortunately, active shooter or active assailant incidents are more prevalent in the United States than ever before. Due to the increasing occurrence of this type of loss, a business that faces this situation may find itself without coverage for many claims that arise post-event. These uncovered losses can include posttraumatic stress (PTSD) treatment, structural improvements of buildings, post-event security, or the inability to handle the onslaught of media post-event.

This article outlines typical policies most businesses buy and describes additional coverage business owners should consider to protect their business, employees and customers/guests if the unthinkable event occurs. It discusses active assailant policies along with other risk prevention techniques. This article helps business owners understand the liability products available and provides some pricing examples. Active assailant coverage is surprisingly affordable, and while not right for every business, certain owners will want to obtain a quote for this important coverage.

Definitions Matter

According to Vox, the week of January 5, 2014, is the only full calendar week without a mass shooting since January 1, 2013. As of April 27, 2019, 104 mass shootings killed 124 people and wounded 375. The Gun Violence Archive defines “mass shootings” as “events in which four or more people, excluding the shooter, were shot.”[i] So ubiquitous are mass shootings that the shooting on the last day of Passover, 2019, in a Poway synagogue did not make the front page in most major newspapers.

The U.S. Department of Justice and the Federal Bureau of Investigation (FBI) outlined active assailant incidents in 2016 and 2017. The FBI found 20 occurrences in 2016; the number increased to 30 in 2017. Unlike the Gun Violence Archive, the FBI excludes gang- and drug- related activities as well as gun-related activities that do not harm others. All 50 shooters were males who acted alone, and the majority of them were in their 20s.[ii] Active assailants focus on soft targets – locations with a high number of people and low security. The events usually occur in businesses (45%), schools (25%) and government facilities (10%).[iii]

The U.S. Department of Homeland Security defines an active shooter as “an individual actively engaged in killing or attempting to kill people in a confined and populated area, typically through the use of firearms.”[iv]

This definition may be important because not all active assailant insurance policies define an active assailant event in the same way. An active assailant incident can range from a shooting, a stabbing, or an explosion such as the Boston Marathon bombing, to individuals driving automobiles into a crowd.

Insuring agreements (the insurer’s promise to pay), definitions and exclusions differ among policies. Historically, active assailant policies stemmed from terrorism and kidnap and ransom policies. However, as these horrific events escalated and the types of damages began to increase, underwriters and claims professionals recognized that these policy forms failed to meet their clients’ needs.

The public and employees began placing more expectations on business owners to protect them from harm. Often business owners failed to recognize their standard commercial policies could leave them with large, uncovered losses, losses that would exceed their policy limits and litigation costs that could devastate a small-to-medium sized company.

Overview of Standard Commercial Insurance Policies

Most business owners buy several insurance policies, such as commercial property and liability, worker’s compensation and business interruption coverages. Attempts by the insurance industry to modify current business policies to cover these events still left coverage gaps for active-assailant incidents. Clearly, society needed more protection.

During an active assailant incident, bullets, explosions, or the police knocking down doors to gain access to the interior will damage the building. Provided the business has the “special” cause of loss form, the insurer would probably cover the damages if the insured meets all other insurance provisions.

The general liability (GL) policy responds when the business owner is “legally liable” for an accident and has breached a duty or standard of care. The business owes an invitee, its customer, a high duty of care to provide an environment free of hidden risks or perils. However, when an active assailant strikes with little or no apparent connection to the property, how can the business’ customers and employees find liability against that owner? While the general liability policy should provide a defense, it may provide few if any benefits to injured customers or employees.

This is where active assailant policies can be invaluable. Paul Marshall, the Managing Director of the Active Shooter/Workplace Violence Division Team at McGowan Programs, one of the premier writers of this coverage, likened the coverage to a “go-fund me account.” The policy will provide immediate benefits, without the wait to determine liability, according to Marshall.

Additionally, while the GL policy provides medical, funeral and death benefits for the customer, regardless of fault, payable amounts are usually $1,000 or $5,000, which may not cover all personal expenses resulting from an active assailant incident. Additionally, costs for an active assailant event, such as cleanup, media control and other costs not faced by a typical injury on a business’ premises can be expensive.

The Occupational Safety and Health Administration (OSHA) Act of 1970 mandates a business ensure the “safety, (health) and security of employees.” As a general standard of care, OSHA can find employers responsible if employees receive “reasonably foreseeable” injuries.[v] While worker’s compensation policies are necessary to provide for the health and well-being of employees injured at work, policies usually extend coverage for the employee while in the course and scope of the job. What about workers who have left their post and are injured as they walk away from the job site? Would they find coverage under workers compensation? Court decisions are still rare regarding these types of events.

Similarly, if an incident arises out of a personal quarrel such as domestic violence, coverage may not apply since the incident does not result from employment. Because workers compensation courts are state-specific, no federal standard applies. One state may find a connection to employment that another state does not.

Business interruption policies are important for the continuation of a commercial endeavor after a loss, but the policy responds only when “direct physical loss of or damage to property at premises…” occurs.[vi]

An employer’s current business policies may leave the owner with significant coverage gaps after an active shooter event. As society changes, insurers respond. Beginning in London and now firmly entrenched in the U.S., specialty insurers in the surplus lines market developed policies to meet the needs of business owners should an active assailant event occur.

Why Every Business Owner Should Consider Active Assailant Coverage

While business owners have many reasons to want active assailant coverage, the most important reason is that the policy helps them avoid large uncovered losses from an active assailant event, losses that would cause the business financial hardship.

A standard commercial property coverage policy will pay to restore the property to its state prior to the loss. However, if the business wants to tighten security by reconfiguring entrances and exits, the property policy would not cover such renovation costs. School administrators rebuilt Sandy Hook Elementary School after the shootings not only to focus on increased security but also to rearrange the school in response to those suffering from PTSD.[vii] The rebuilding of the Sandy Hook elementary school cost Connecticut taxpayers $50 million. A standard commercial property policy would not provide that coverage, even given actual damage to the premises itself. Some active assailant forms will provide that coverage.

Liability policies respond if the active assailant event meets the definition of an “occurrence” as defined by the policy. If an active shooter or other event causes multiple injuries or fatalities and a court rules the event is one occurrence, an owner’s liability policy limits will quickly erode. While it may seem beneficial for the court to determine that such an event constitutes more than one occurrence, this, too, can harm a business that has a large self-insured retention or a high deductible.[viii] Finally, liability policies generally have assault and battery exclusions and terrorism exclusions. It is possible the insurer could invoke these exclusions and deny the damages.

As mentioned previously, a workers compensation policy may not respond to employees’ medical needs if the employees are not in the scope and course of their employment when the event occurs and if the attack on employees is unrelated to the workplace.[ix] For example, an administrative law judge may not find a purely personal quarrel between spouses or intimate partners work-related. Many workplace fatalities arise from domestic quarrels. In workplace shootings between 2003 and 2008, a current or former partner killed nearly 33% of the female decedents.[x]

Other Insurance Considerations

If the business did not sustain direct physical damage from an active assailant event, the business interruption policy would not respond. However, if police quarantine the area during investigation and the business cannot reopen during that time, coverage for civil authority may apply. Business owners should discuss this important item with their current brokers to determine if they have coverage and if their limits are appropriate.

The “Other Insurance” clause appears in nearly every policy (except life insurance) and is most prevalent in property and liability policies. This clause establishes how multiple insurers will pay a loss where the event triggers more than one policy. Depending on policy language, the policy will provide no coverage if there is another insurer that covers the same risk; or it will provide a proportionate share of the damages with the other insurer; or it will be in excess of the other insurer. Policies include this language to prohibit a business from profiting by submitting a loss as the same claim to more than one insurer. Check this clause in the active assailant policy to ensure these policies are primary, not excess, of other liability coverage.

Finally, an insurer could consider an active assailant occurrence as an act of terrorism, which a business’ policy purchased under the Terrorism Risk Insurance Program Reauthorization Act of 2015 (TRIPRA) could exclude.[xi] The incident must meet certain criteria, such as property and casualty losses of more than $5 million. Additionally, the U.S. Secretary of the Treasury, the Attorney General and the US Secretary of Homeland Security must declare the loss a “Certified Terrorist Attack.” The government did not certify the Boston bombing event because damages did not exceed the $5 million threshold.[xii] In addition, for insurers to consider the active assailant event as an act of terror, the act must be a part of “an effort to coerce the civilian population of the United States or to influence a [U.S. government’s] policy…”[xiii]

What Is Active Assailant Insurance?

After an agent or broker reviews the current coverages of a business, the agent may offer active assailant insurance as a separate policy. Active assailant coverage can help fill coverage gaps so the business does not face uncovered losses that are potentially bankrupting. Coverages encompass crisis management aid, off-site/international attacks, loss of attraction losses and prevention techniques.

Indirect loss costs arise unexpectedly after active shooter events, and active assailant policies help to stem those costs. For example, after a 2017 airport attack in Florida, Broward County spent over $500,000 to return luggage abandoned by passengers.

Unlike standard business policies, most active assailant policies offer crisis management both pre-event to help plan for an active shooter and post event. Hiscox’s terrorism policy evolved to encompass active assailant coverage, according to Jennifer Rubin, head of Hiscox’s terrorism, war and political violence division. Hiscox partners with a public relations company to provide crisis management services, both firms working with the media to ensure that communication flows smoothly post event.[xiv]

Post event, experts reassure families and demonstrate to the public that the business is handling the assault with competence and consideration. The insurer also may facilitate victim counseling and plan steps needed to assist crisis victims. Crisis management will help the business return to customary operations more quickly than business owners who deal with the aftermath of these events on their own.

Business interruption coverage does not begin unless direct physical damage or a shut down due to civil authority occurs. Likewise, a business interruption policy would not respond to a business downturn because customers no longer feel safe at the location. This contingent loss – not a direct loss like damage to the building itself, but an indirect “loss of attraction” because of the event – can be fiscally devastating. An active shooter policy can help with this contingent loss.

Litigation is costly regardless of the type of loss, and it is beneficial for a business to obtain broad coverage for the litigation that will follow an assault. Some carriers writing this coverage offer loss prevention services pre-event so that businesses can identify troubled individuals in an effort to avoid the event all together.[xv] These services may include training and social media monitoring as well as other pre-loss activities.

Business owners must take special care when reading their policies to understand the policy definitions and determine when coverage is in-force. For example, while workers compensation may cover employees’ injuries, the active assailant policy may specifically exclude such injuries, according to McGowan’s marketing material. A business owner should require an endorsement naming the employees, volunteers, or students as insureds to prevent the form from excluding these persons from coverage.

Determining thresholds or maximum amount of coverage is an important decision. Is $1 million in coverage enough considering your exposure or would $3 million be better? Most small businesses usually choose between $1 million and $3 million in limits, according to several active assailant underwriters.

In some policies, coverage begins after a certain number of victims are physically wounded or deceased. The policy may also limit a maximum number of victims – for example, the limit could be set at 50 victims. It is important to consider not only the deceased victims of the active assailant but also those who have emotional or mental trauma due to the assault. On March 23, 2019, in Coral Springs, Florida, police responded to a second student who died from suicide – a student who initially survived the shooting at Marjory Stoneman Douglas High School on February 14, 2018. Therapists diagnosed the student with PTSD while at university, and the school district provided therapy animals and counselors. This help may be insufficient for many survivors.[xvi]

Policy definitions play a major role in an active assailant policy. Consider whether the policy covers only an active shooter or if assaults by knives and explosives also are covered losses. Additionally a policy may exclude assaults by vehicles. In London in June 2017, assailants used an automobile to drive into a crowd of pedestrians.

Each policy will respond to the crisis differently based on how it defines the event or occurrence.

A policy could describe a firearm as loaded to be “deadly,” and a firearm must meet that definition before coverage would apply. For example, absent threats of deadly force or no bodily injuries, deaths, or attacks with loaded firearms, PTSD claims may not be covered. Business owners should consult their agents and brokers to ensure they have the broadest coverage available given the premium.

How Costly is Active Assailant Coverage?

Most small-to-medium sized business owners today buy coverage limits of $1 million or $3 million, as previously mentioned. Larger businesses can buy limits up to $100 million, according to one underwriter.

Underwriters base quotes on number of employees added to annual number of guests for retail stores, schools and other establishments. They use crime maps to assess all locations and a variety of other factors to determine premium. Many carriers use a three-page or less application, so applying for coverage is easy. Business owners can obtain quotes through insurance agents who offer more nuanced coverages. If your current agent cannot help you, visit Trusted Choice at the Independent Insurance Agents & of America website to find a drop-down menu that will help you locate an independent insurance agent in your area.

Premiums are still affordable. For example, an art museum in a major city purchased $1 million limits for $3,000. A New Jersey hotel purchased $1 million limits for $6,500. A stock brokerage in Pittsburgh with 1,515 employees and yearly visitors would pay about $1,340 for $1 million coverage or $2,320 for $3 million coverage.

While active assailant policies have covered some recent events, these are “long-tail” claims, meaning it may be years before carriers total the final loss numbers. Because carriers writing the coverage have little history on which to base rates, the rate future remains cloudy.

Other Risk Management Tools

Business owners can protect themselves by employing methods other than insurance, such as monitoring social feeds and conducting emergency drills.

One idea in this era of protection against active assailants is to arm front-line personnel. Fourteen states allow teachers to carry guns in the classroom.[xvii] The belief is that armed personnel can defuse the active assailant situation before the police arrive. Arming personnel may open the business to a higher standard of care and higher premiums.

Underwriting applications ask if a business has armed guards. Always completely disclose your business’ current situation on the policy application. Any mistakes or misrepresentations could void coverage.

Unfortunately, juries could find that armed personnel were acting as an agent of the business, which increases the business’s liability. While active assailant insurance applications ask if the business has an onsite security team, armed civilians could eliminate any potential carriers willing to underwrite the risk.[xviii]

Just as schools conduct tornado and fire drills, a business can reduce the risk of casualties by using active assailant scenarios to develop a plan, implement it, and train employees, students and other covered personnel. In these simulations, participants develop a clearer vision of how to remove themselves and their customers from the situation until help arrives, if possible. Insurance applications ask who designed the business’ emergency plan and if a risk-consulting firm reviewed it

Applications also ask about past threats and attacks. Again, always disclose any events or activities that might be important to the underwriter considering the risk.

It is also useful for employers to monitor social media feeds. Monitoring social media can help identify an employee or person who might become an active shooter. In the case of the shooting at Marjory Stoneman Douglas High School, the school had expelled suspect Nikolas Cruz for “disciplinary reasons.”[xix] In the police and FBI investigation of the shooting, social media posts from Cruz showed weapons lying on a bed and a YouTube message stating, “Im [sic] going to be a professional school shooter.”[xx] Being aware of these red flags and taking action when found can help reduce the risk of an active assailant event.

How Will a Carrier Handle Your Claims?

The insurance industry divides insurance in the U.S. market into two categories: the admitted market and the non-admitted market. The admitted market insurers, also known as “standard market carriers,” are insurers who are “admitted” to carry out insurance functions in a state. Admitted carriers follow each state’s department of insurance rules and regulations. Non-admitted carriers are often excess and surplus line insurers and operate in the state without conforming to each department of insurance approval process. This difference is important when it comes to claim handling since most admitted carriers have their own claims department while non-admitted insurers often use third-party claim administrators (TPA), which are independent firms hired by carriers to handle its claims.

When considering active assailant coverage, ask about the claims process should an incident occur. You will require swift assistance following an assault. Carriers are currently developing a new type of claim team to handle these losses, trained and ready to deploy overnight. These specialty teams should encompass worker’s compensation adjusters who understand traumatic injuries management as well as aspects of PTSD; liability adjusters to address non-employee claims; property adjusters to appraise physical damages to buildings; and a lead or general adjuster as a point person with whom the business can correspond and coordinate plans. One of the closest models to these types of teams is airline disaster adjusters.

Admitted insurers such as AIG have their own staffs. Non-admitted carriers like syndicates at Lloyd’s of London generally contract with large TPAs, which have a dedicated crisis management team familiar with active assailant events.

It’s a New Time in America

Experts say no one can predict an active shooter occurrence. However, due to their increasing frequency, the insurance marketplace has stepped forward to address the concern. Preventive steps offered by some carriers range from helping employers identify troubled individuals before they kill to providing training designed to teach those in a crisis how to respond to reduce casualties.

No policy can be “one size fits all,” but careful coordination with an experienced insurance agent will help you avoid financially catastrophic and uncovered losses that could force your business into bankruptcy.

Work with an Agent Who Understands Active Assailant Coverage

A recent article in Insurance Journal warned agents about straying into coverages outside their expertise. Active assailant coverage is new and emerging. Few agents have deep expertise in this coverage. It pays to know your agent and ask what experience she or he has in placing this coverage.

According to Lori Hunter, a broker with Worldwide Facilities in Los Angeles, “This coverage is highly specialized and few brokers have expertise in part because it is a newer coverage. Only a few companies quote this line [of coverage], so my recommendation is to ask for two or three quotes and go over the policy forms with your agent. Pay special attention to the insuring agreement, the definitions and the exclusions.

“If you remain unsure about coverage ask your agent to arrange a call with the underwriter or representative from the wholesaler or MGA that quoted the risk to answer any questions you may have.”

Will These Events Continue to Escalate?

Active shooter and other mass violence events in America are not going away. We are probably years away from gun regulation, although students of the Parkland shooting sparked a national trend of activism that may result in legislative changes. Increased political rancor, greater alienation in our population and untreated psychiatric disorders are just some of the reasons we may see these events, whether with guns or other weapons, continue to increase.

In a 2015 essay by Malcolm Gladwell, author of The Tipping Point, discussing the work of sociologist Ralph Larkin, Gladwell wrote that the Columbine shooting “laid down the ‘cultural script’ for the next generation of shooters.” Gladwell suggested that “low threshold” shooters would be motivated to act. “The problem is not that there is an endless supply of deeply disturbed young men who are willing to contemplate horrific acts. It’s worse. It’s that young men no longer need to be deeply disturbed to commit horrific acts.”[xxi]

Should You Consider Active Shooter Coverage?

Virtually all business owners today should determine if their business could be the target of, or adjacent to, an active shooter event. Today’s active assailants not only focus on schools, but they also focus on soft targets – locations with a high number of people and low security. Malls, theaters, taverns near areas where the public congregates, houses of faith, charter schools – no organization with public access should consider itself exempt from this type of tragic event. An event that occurs nearby can spill over into your establishment.

According to the Department of Homeland Security, active shooter situations typically evolve quickly, are highly unpredictable and usually end within 10-to-15 minutes. The damages, both physical and psychological to people as well as property damage costs, however, will persist for years. As active shooters continue to threaten and insurers respond, coverage will change, both narrowing and expanding to manage the tragic consequences of these violent mass events. An annual discussion with your agent prior to renewal or when circumstances change in your business can help ensure you have the most appropriate coverage for your current loss exposures

[i] Lopez, G., & Sukuman, K. (2018, July 09). Mass shootings since Sandy Hook, in one map. Retrieved April 3, 2019, from

[ii] United States, US Department of Justice and Federal Bureau of Investigations, FBI. (2018, April). Active Shooter Incidents in the United States in 2016 and 2017. Retrieved April 3, 2019, from

[iii] Active Shooter Facts. (2018, November 30). Retrieved 3 April 2019 from

[iv] United States, US Department of Homeland Security. (n.d.). Active Shooter Pocket Card. Retrieved April 1, 2019, from

[v] Moorcraft, B. (n.d.). What is active shooter insurance coverage? Retrieved April 1, 2019, from

[vi] Insurance Services Office, Inc. Business Income (and Extra Expense) Coverage Form; CP 0030 (10/12).

[vii] Delgadillo, N. (n.d.). With Shootings on the Rise, Schools Turn to ‘Active Shooter’ Insurance. Retrieved 1 April 2019 from

[viii] Marshall, Paul. Buyer’s Guide: Active Shooter Insurance; Retrieved 27 March 2019 from

[ix] Marsh Risk Consulting. (n.d.). Protecting People and Operations from Active Shooter Threats (Tech.). Retrieved April 1, 2019, from Shooter White Paper-11-30-17.pdf

Michigan Independent Colleges & Universities

[x] The Facts on Gender-Based Workplace Violence. (n.d.). Retrieved April 22, 2019, from

[xi] Ibid.

[xii] Boston Bombing Lesson: Risk Managers Urge Better ‘Terror Act’ Certification. (2015, March 18). Retrieved April 28, 2019, from

[xiii] Marsh Risk Consulting; Marsh’s Casualty Practice; Marsh’s Property Practice. Protecting People and Operations from Active Shooter Threats

[xiv] Hiscox’s Rubin: The Range of Active Shooter-Type Scenarios Is Expanding. (n.d.). Retrieved April 3, 2019, from

[xv] Marshall, P. (2018, September 3). Insurance Coverage for Active Shooter Risks. Retrieved April 3, 2019, from

[xvi] Mazzei, P. (2019, March 24). After 2 Apparent Student Suicides, Parkland Grieves Again. Retrieved April 2, 2019, from

[xvii] Maqbool, A. (2018, December 07). Inside a US training course to arm teachers. Retrieved April 2, 2019, from

[xviii] Heisler, A. (2018, May 03). Allowing Guns in the Workplace Introduces Liability Risk. Retrieved April 2, 2019, from

[xix] Kennedy, K. (2018, February 15). School shooting suspect made ‘disturbing’ social media posts. Retrieved April 2, 2019, from

[xx] Penney, T. (2018, February 15). Prior social media posts and active shooters. Retrieved April 2, 2019, from

[xxi] Gladwell, M. (2019, April 19). How School Shootings Spread. Retrieved from

The power of the press release

A press release does several things for your business.

  • A news release announces a recent accomplishment you have achieved. For example, it could be a class you completed; a professional designation you earned; a civic award; your appointment to a board or charity; an educational goal you may have attained; a new program you are rolling out; an office expansion; or any noteworthy event that keeps your name in the public arena. One caveat: Don’t fall into the trap of the “I feel good” press release. Find the hook in the accomplishment, which means that the accomplishment also helps your clients, not just you.
  • A press release announces a new program roll out or personnel change. Maybe you have partnered with a new carrier or formed a new strategic alliance. Perhaps you’ve lured a new hire with impressive credentials. Maybe you’ve grown so much that you’re opening a new location.

A press release reminds editors that you are an expert. Every press release should include a brief biography or a short history of your company. The pitch reminds editors to call you, not your competitor, the next time they are looking for a quote or information on insurance for an article they are writing or a television soundbite.

You can write a release yourself after you get the hang of it, but for your first few releases, we’d suggest hiring a professional. “Pushing” the press release is an additional cost and we can help you determine how to best publish your news release. A press release provides free advertising and puts your name in front of important local or national newsmakers who can turn to you when they need information, which means more free advertising. Keeping your name in the public arena is vital to increasing business.

Ask yourself this question: If I planned to buy a house, which realtor’s name would immediately pop into my head in my location? Try to make your name synonymous with insurance in your community.

Press releases are a very inexpensive form of advertising that reminds your community that you are the best one to call when purchasing insurance.

Weasel words can weaken your writing

Do you use “weasel words”? I don’t mean a furry critter that goes through your garbage in the late hours of the night. Weasel words are terms and phrases that are deliberately fuzzy. Rather than providing clarity, weasel words obscure your message.

Weasel words get their name from the crafty weasel, which sucks eggs without breaking the shell. Similarly, weasel words suck the meaning out of your message. If you communicate with phrases like “highest quality,” “prompt service,” or “highly qualified,” you may be weaseling, even if inadvertently.

Before you write, ask yourself, “What exactly do I offer?” If you believe your product is of the highest quality, explain why. For example, tell your clients that you represent only A-rated insurance carriers and briefly explain the importance of that rating. This offers much clearer information to your potential customer.

If you offer prompt service, you might say “We return all phone calls within 24 hours and you will have my cell number.” This clear message informs people that “We are so committed to excellent service that we offer you this promise.” No matter what product they buy, everyone wants to be a priority customer.

No matter what product they are buying, everyone wants to be a priority customer.

“Highly qualified” doesn’t explain the depth of your expertise. “Meeting the insurance needs of the Phoenix contractor’s community for over a decade” gives potential clients a better understanding of the depth of your knowledge.

Another way to weasel is with vague introductory phrases, like writing, “With all due respect”? If you disagree with someone’s opinion, don’t bother telling them that you respect them. State your case and then offer to discuss their concerns with them personally. This leaves the door open for more communication.

Weasel words can destroy communication. No matter well you write it is easy to slip into fuzziness. Weasel words weaken your writing and don’t educate the reader to the benefits of doing business with you.Ferret

White Papers keep your business in your prospects’ minds

More and more insurance industry organizations turn to White Papers to spread their message.

What is a white paper? A white paper is usually a “thought leadership” paper of about five-to-12 pages that highlights one or more of the benefits of your business. Insurance organizations use white papers to educate the public by delineating a problem or a challenge then posing a solution, usually highlighting your services.

Here are some of the key elements of a white paper:

  • Cover page
  • Executive summary
  • Description of the problem or issue the paper addresses
  • A solution to the problem
  • An action step (how readers can take action utilizing your product to solve their dilemma)
  • Charts and graphs, if needed
  • Footnotes, if needed
  • A conclusion
  • Information about your company

Once written, organizations distribute their papers either electronically to sites your potential clients visit, to sites that warehouse business data, or to their customer list. They are also great to hand out at a trade show booth or a local networking event.

One of the best uses of a White Paper is to announce its publication with a press release distributed through Business Wire or some other news service agency. A White Paper may simply serve as a reminder to clients who haven’t used your services in a long while or to those who’ve considered you in the past. It’s one way of saying, “We’re still eager to work with you.”

White papers generate short-term “buzz” and create a long-lasting testimonial that builds your brand.

Insurance white papers abound. Some insurance-related white papers we’ve written include “Computer Modeling Tames Super-Cat Hurricane Risk,” “Growing Wildland Urban Interface Increases Wildfire Risk,” and “Supply Chain Risk: Hidden Exposures for Your Company.

To non-insurance readers, these topics sound pretty dull. Okay, to insurance geeks, they still sound kind of dull. That’s why, if you’re considering a white paper to promote your business or technology, finding a writer with knowledge of the insurance industry and enthusiasm for the project is imperative. I can help.

Feel free to contact me at via my website at for more information or call me (602) 870-3230.

Lose those adverbs and strengthen your writing

Part of our ability to promote and persuade in the insurance industry hinges on our ability to write clearly, concisely and unemotionally. By eliminating adverbs from our writing, we can reduce the clutter in our communications.

What is an adverb and why should anyone care? An adverb is a part of speech that modifies several parts of the language, including verbs and adjectives. Often, adverbs end in “ly.”

Adverbs often answer questions like “when,” “how often,” “how,” or “in what manner.” Here are some adverbs:

· admittedly
· sadly
· totally
· highly
· completely

Adverbs weaken your writing. Most adverbs can be eliminated from text without losing one iota of meaning.

We see adverbs often in insurance writing. Have you ever written any of these sentences?

“The home was totally destroyed.” If it was destroyed, why do you need to add “totally”?

“Admittedly, you made a valid point.” If you say the point was valid, why add “admittedly”?

“I note that you were understandably confused.” Not only is the tone condescending, but it’s clearer to say, “I understand your confusion.”

We can avoid the use of adverbs in writing by using verbs. Instead of saying, “I was badly mistaken,” how about saying, “I was wrong”? Or instead of writing, “That is highly unlikely,” try “That is improbable.”

Search “ly” with your ‘find’ function and you can search and delete those adverbs. Your writing will be clearer and more concise.

Even the best writer needs occasional help to deliver the best message in the fewest words. A copywriter streamline your communications and set you apart from your competitors.

Improve your insurance technical writing by removing passive voice

meetingWhat is passive voice and why should you avoid it in your insurance writing? No matter what you’re writing for the insurance industry, a blog, a technical report or a white paper designed for marketing your business, passive voice weakens your writing. Once you understand a little about passive voice, it becomes much easier to find and eliminate it in your own writing.

What is passive voice?

Passive voice sentence construction occurs when the subject of a sentence becomes the object of an action. I know, it’s a grammar thing, something we disliked in school. Here’s an example of passive voice.

Our underwriting team was defeated by the western region.

Passive sentence construction weakens your writer because, in a nutshell, no one takes responsibility for the action. Written actively, this sentence would read like this:

The western underwriting region defeated our sales team.

Ouch! That wording smarts a bit more, doesn’t it?

In passive voice, the subject of the sentence is acted upon.

The applicant was rejected by Tom due to his negative loss history.

In active voice, the subject of the sentence (Tom the underwriter) performs the action.

Tom rejected the applicant due to his recent negative loss history.

One easy way to fix this and many passive sentences is to put the actor, Tom, ahead of the verb, “rejected” in the sentence.

Tips to find passive voice

To find passive voice, look for verb forms like “to be,” like “is,” “are,” “were,” followed by what is known as a past particle, a verb typically ending in “ed.” To make things harder, not all forms of “to be” are passive, but it’s a good red flag.

Here are a few more examples.

The claims department’s closing ratio was reduced last month by a high number of flu-ridden adjusters.

Rewritten actively you might say something like this:

Absenteeism in the claims department from the flu reduced last month’s closing ratios.

Here’s another passive construction.

The marketing team’s attendance at RIMS was delayed by one day due to bad weather in Atlanta.

Rewritten actively, the sentence might read like this:

Due to bad weather in Atlanta, the marketing team arrived at RIMS one day late.

I know what you’re thinking: “This is too hard! It’s grammar! I have a solution for you, or rather Microsoft Office does. While grammar check in MS Word won’t catch every instance of passive voice, it does a darn good job.

Here’s the plan

First, ensure you turn on grammar check in Word. If you aren’t sure how, read this link. Just be sure when you click your Review tab on Word and you click the Spelling & Grammar tab, the box at the bottom marked “Check grammar” has a check mark in it. (Now, if I’d said “is clicked,” I would be using a passive construction and Word would not catch it.)

Next, run the Spelling & Grammar check on your entire document. If you are new at writing active voice (the opposite of passive voice and what we strive for), you will probably have a high percentage of passive voice in your document. You will find the percentage of passive voice instances on the final grammar check tab under Readability, Passive Sentences.

Finally, to narrow down the location of your passive writing, go paragraph by paragraph with Spelling and Grammar. Do this by highlighting one paragraph at a time. If necessary, highlight sentence by sentence. Find the offending sentence and reword it. As you move to active voice in all your documents, you’ll find your writing comes alive and your audience, whether or not they understand grammar mechanics, will appreciate your writing style much more.

I’m a technical person – Give me a number

What percentage of writing should be passive? Professional writers argue percentages, but I strive for no passive writing in my work. If you’re new to this concept, shoot for five percent passive, and then aim even lower as you learn.

But we write about insurance,” you may argue. “It’s technical and somewhat boring!” Experts argue that even highly technical writing should avoid the use of passive voice. Even though we’re writing about insurance, we should never bore our readers. Our writing should be clear, crisp, concise and active. This writing style engages the reader and helps to ensure he or she will tag along to the end of your writing, whether it’s a claim report, an underwriting manual or a insurance white paper designed to educate clients or consumers.

In conclusion

One of the problems of passive voice is that we may attempt to distance ourselves from our decisions with the use of passive voice. I recommend you step up and say it like it is – take responsibility by using active voice. After all, that’s what we do in the insurance industry – we make decisions.

Active voice bolsters your writing, helping to engage your reader every step of the sometimes technical way. With the help of Microsoft and a few simple tips, you can actively improve your writing.

Tips to avoid a dryer fire

Dryer hoses. Use a metal one as shown.

How safe is your dryer? According to the US Fire Administration (USFA), about 2,900 dryer fires occur each year in the United States. These fires caused five deaths, about 100 injuries and over $35 million in property losses annually. While the leading cause of dryer fires is accumulated dust, fiber and lint, the type of exhaust hose you install can greatly reduce your risk of fire.

Using a plastic or vinyl dryer hose can cause fires, according to the USFA. The photo shows in the top half the type of dryer exhaust hose you should use. If you are currently using the bottom type, a plastic hose, replace it immediately. These types of hoses can melt or ignite.

It’s always a good idea to take a few other preventative measures. 1) Clean your lint filter after each cycle. 2) Install a smoke alarm in your laundry room or adjacent to your dryer. 3) Never leave the dryer running when you’re away from home. 4) Never vent your dryer anywhere except directly outdoors. Venting into an attic or soffit is a recipe for fire and violates most local fire codes.

The average cost of a dryer fire if it’s contained to the room of origin ran just under $1,800 in the past few years, according to USFA. However, dryer fires that spread beyond the room of origin had an average cost of just over $49,000. Money is only part of the equation if a dryer fire breaks out in your home, however. Who can put a dollar value on the injury or death of a loved one, or the death of a beloved family pet, should a fire break out?

For further information on dryer safety, visit this link National Fire Protection Association link.


How Do I Write a Professional Bio?

Every insurance professional should develop several professional biographies. Why a bio? Because despite our increasing reliance on electronic communications, people still want to know a little about you before they contact you. Your bio is a marketing tool that helps to build your brand. Your brand is your name and the name of your company. When people consider insurance, you want your name to be the one that comes into their minds. This can only come through repeated branding of your name, or the name of your agency, with insurance.

Here are the top reasons to write your professional bio.

There are thousands of insurance agents and other insurance professionals for people to choose from, plus growing competition from direct writers. Therefore, it is imperative that you set yourself apart from the crowd. A professional bio quickly showcases your experience and sets you apart from the crowd.

A bio is the quickest way to say, “Insurance is not just a job; insurance is my career and I am proud to be an agent.”

A bio will introduce you to new clients and potential strategic partners. Your bio can open doors to many new opportunities.

You can use your bio to obtain speaking engagements and media appearances. Perhaps you might author an article for a local newspaper on some aspect of insurance. Maybe you could be a guest on a local radio talk show. Perhaps you may give a talk at a local service organization. The bio opens the door to all this and more to help you build your brand.

Your bio can provide a dash of personal information that helps people relate to you in some way. This builds bridges and encourages people to contact you.

Have at least two bios on hand. One should be short, so pick the key points in your personal life and your career that provide the best flavor of who you are. A longer one can take a deeper dive into your background and you can use it for speaking engagements and in responses to requests for proposals. Once you write your bio, you can use it again and again, or revise it as your career deepens and your expertise grows.

If you or your team need help creating a bio that works for you, feel free to contact us at Insurance Writer.

Are We Too Focused on the Goal?

Oakland policeA few years ago, the Oakland Police Department spent hours trying to oust a gunman who had barricaded himself inside his house. After firing tear gas canisters into the house, the officers finally noticed the home owner standing beside them in the police lineup, chanting, “Please come out and give yourself up!”

It’s a great thing to set goals and feel proud of our successes. However, to truly succeed in life as well in business, we should remember there are others beside us, also helping us to succeed. Survey after survey shows employees feel increasingly disenfranchised from their work, which hurts productivity and creates customer service issues galore. Employers complain woefully about a lack of talent, yet fail to do everything in their power to keep the very employees they currently employ.

Take a moment today to listen to and sincerely respond to those who help you to succeed, including your employees.

Squirrel! ADHD Officially Hits Training

squirrel - nutkinOhio has become the first state to officially allow continuing education for accountants in ten-minute increments. I don’t know whether to yell “Squirrel” or applaud them for understanding the way most people seem to learn today.

What do you think? Would you want your accountant doing his or her continuing education in ten-minute increments?

Risk Avoidance and What the Heck is Wrong With People?

anger management

I rarely go into Circle Ks or convenience stores or places of that ilk because I’d prefer not to get shot (risk avoidance). However, on the way to a volunteer gig the other day and against my better judgment, I stopped in a Circle K near Interstate 17 in Phoenix to buy a pop (or soda, as some call it). As I walked in, I noticed there was a mop bucket full of black water near the register and that my shoes stuck to the floor as I went to get my pop. As I filled my cup, I noticed a sign that said, “Out of straws.”

At the register I said hello to the cashier and asked the young man if he was holding out and if perhaps he did have a straw. He nearly started crying. He said they ran out of straws earlier in the day and he couldn’t get any from neighboring Circle Ks (franchise issues?). He said that people were so irate that they were dumping their entire sodas on the floor, which he had to clean up.

I asked, “Really, it’s like ‘I hereby dump my soda on the floor in protest because you are out of straws?'” Yes, he responded sadly. He said he had given his two-week notice because he just “just couldn’t take it anymore.”

Wow. Not having a straw for a Big Gulp? Not a rage-o-meter offense, in my humble opinion. Which leads me to today’s topic: “What the heck is wrong with people?” That young man, so traumatized by the day’s events that he quit his job, is a human being. He’s someone’s son, he’s a grandchild, and he’s a human being with feelings. Have we swung so low that we’re willing to dump our sugary sodas on the floor and our rage onto a poor cashier in a convenience store?

Don’t get me wrong. I know that everyone, me included, acts badly from time to time. We lose our temper in traffic, we snap at someone who may only be trying to help us, or we hang up in frustration on a customer-support person. However, for people to stoop this low, to “make a statement” that makes no statement other than they desperately need anger management, to me is simply beyond comprehension.

I have nothing deep and philosophical to say about this except it makes me much more aware that my behavior has consequences. It also reminds me that this type of bad behavior means we as risk management professionals will always have jobs.

I am so grateful that I don’t carry useless, non-specific rage over an imaginary victim status. When a store is out of straws, it isn’t a personal affront to me or an assault by the universe to make my life harder. Apparently, though, that rage is present in and acted on by many.  And that, my friends, is exactly why I stay out of convenience stores. That and Milk Duds. But that’s another story.

Talent Management a Top Concern for the Nation’s Insurers

By 2020, an astounding 40 percent of the workforce will be our Millennials, born between 1976 and 2001. Is your organization ready?

business team standing


Did you know that by 2014, Forbes predicts that 36 percent of the workforce will be comprised of Millennials? And by 2020, an astounding 40 percent of the workforce will be our Millennials, born between 1976 and 2001. Is your organization ready?

Yesterday I attended a Society of Insurance Trainers & Educators gathering in Scottsdale hosted by Markel. We discussed the current generation of Millennials entering the workforce and taking their places in many of the nation’s insurance internships. Where are we going to get this talent? I think the question that is perhaps more important is this: Once we recruit them, how do we manage them for their long-term growth and their long-term retention in the organization?

Here are a few facts we know about our Millennials.

  • More than high salaries, Millennials want to find careers that “make a difference.” Our industry has failed to capitalize on the fact that as an industry, we pump billions into the economy to restore people’s lives, allow businesses to grow and expand, and to promote worthwhile charities. Maybe we should strongly consider improving our image through our marketing efforts.
  • Millennials are the most chauffeured, tutored, scheduled and micromanaged generation in history. They are not, by and large, risk takers. You know that hovering manager who drives the self-directed Baby Boomer employees crazy (and often out the door)? Why not place that manager in charge of your new hires and interns? Mills want and need more reinforcement as opposed to Boomers, who generally want to be shown a desk and left alone.
  • As Millennials graduate from college, they are often swimming in debt. Let’s show Mills a career path with income factors they can tie to specific achievements, for example earning an Associate in Claims or the CPCU designation.
  • According to Pew Research Center, our Millennials are the most college-educated generation in US history. Holding a college degree, or even an advanced degree, does not necessarily mean that all those young people possess the skills to succeed in the insurance industry. Don’t be surprised when you must invest in teaching skills you assume a Millennial would have learned in college, like critical thinking or how to use a spreadsheet.
  • Millennials will be your biggest brand ambassadors. We need to encourage their responsible dialogue on social media, not discourage it or suppress it in the workplace. Almost one-quarter of Millennials factor their job choice on the hiring organization’s social media policies, according to the Forbes article.
  • Millennials will assume supervisory and management positions much more quickly than did we Boomers. Therefore, it is critical that we hire for leadership attributes: integrity, communication skills, self-confidence, a sense of humor, creativity and critical-thinking skills, to list just a few.

If you are concerned about where the insurance industry will find its next generation of talent, take heart. The industry has begun to seriously address this problem. (We’re never first to the scene of a fire, are we?) Let’s keep talking, but more importantly, let’s begin to change the perceptions of our industry to attract and retain that next generation.

Cavalcade of Risk #205

There’s a lot of great news and advice from the risk management front in this edition of the Cavalcade of Risk.

Risk management tips

There’s a lot of great news and advice from the risk management front in this edition of the Cavalcade of Risk. Let’s begin by evaluating the risk that your employer-provided health insurance may soon be a thing of the past. InsureBlog’s Nate Ogden evaluates Ezekial Emmanuel’s dire predictions.

When it comes to worker health and safety, Julie Ferguson of Workers’ Comp Insider says that it may be time to shake up the film industry again. According to Ms. Ferguson, it is no more acceptable for film employers to try to play fast and loose with worker lives than it is for coal mining, manufacturing, or any other industry.  In her post Death on a Georgia Railroad Trestle, she talks about how a recent fatality is sparking calls for safety reforms in the Hollywood film community.

Speaking of worker health and safety, did you know you can probably avoid hiring your next workers’ compensation claim? Much of workers compensation cost containment is related to good information, good systems, and proper planning. When it comes to hiring, it can be staggering to think about the amount of liability a company is taking on with each new employee. When you bring on a new employee, you are also bringing on the liability that they can safely perform their job. Michael Stack at Reduce Your Workers’ Comp blog offers us a few tips.

We always look forward to a glimpse at Bob’s Cluttered Desk, and this month Robert Wilson looks at school shooting drills. States are embracing active shooter drills in public schools, conducting sometimes unannounced drills that simulate an active shooter on campus. In some districts teachers are expected to be shot by pellet guns as part of the training. Is this a good idea, or simply a way to traumatize teachers and their students?

How much does your genetic composition affect the risk you will have a chronic condition?  The answer is not as much as you might have thought. Jason Shafrin of The Healthcare Economist investigates.

With today’s college students frequently graduating with loads of debt, Jon Haver of Pay My Student Loans blog, describes why today’s graduates need to consider life insurance now, not in the future.

Finally, at my Insurance Writer blog, I offer the top ten habits new risk managers should avoid to succeed in their new and often challenging positions. I learned many of these mistakes from first-hand experience.

Dennis Wall is our next host. He has chosen his theme and he is asking for posts related to residential mortgages, force-placed insurance, the participants in the mortgage process, the participants in the securitization of mortgages, and related themes.

Top Ten Mistakes to Avoid as a New Risk Manager

If you’re a new risk manager, these tips can help you transition into your new, challenging role.

Avoid these mistakes

The transition into your first risk management job can be difficult. Whether your boss promotes you into your first risk management job or hires you from another organization, you want to excel at your new position over the long haul. In part, that means avoiding mistakes, even though we often learn our best lessons when we fail. However, some mistakes can seriously hurt your risk management program, harm your reputation, or even derail your career. Here are ten mistakes you can avoid.

1. Don’t rush in with all the answers. You may arrive wanting to form your own alliances and acquire your own team, but avoid making hasty decisions. Give current employees a chance to prove themselves before you transfer them or hire your own team. The same applies to vendor relationships. You can lose a great deal of historical exposure along with loss history and coverage negotiation knowledge if you immediately decide to switch insurance brokers. “Changing brokers can be a great way to create significant coverage gaps or an errors and omissions claim for your friend the new broker,” according to one Atlanta broker. Some vendor alliances, such as relationships with contractors and body shops, may be long-standing, especially in a small town. Rushing in and making changes can cause big ripples in a little pond.

2. Don’t try to do everything at once. In my teens, I read a book called Ringolevio, about a kid named Emmett Groan growing up in the streets of New York City. One of his compatriots frequently warned Emmett when he was about to rush headlong into a decision, “Take it easy, greasy, you’ve got a long way to slide.” I found that advice very applicable in risk management. If you inherit a big job, you will be faced with hundreds of decisions, some big, some small. Take your time. While you may feel overwhelmed at first, chip away at the organization’s most pressing problems. Put out fires as they arise. Then schedule time for you and your advisers — your brokers, your attorneys, your actuaries, and your managers – to develop sound strategies and solid strategic plans.

3. Don’t use a shotgun, use a rifle. If the organization is experiencing too many injuries, for example, don’t jump to an obvious solution like deciding more personal protective equipment will answer the company’s biggest safety issues. Talk with front-line supervisors, study historical loss data, and consider several options before you throw money at a problem. Once in the door, interview employees, talk with other managers, meet with your vendors, and set a few important priorities for your first six months in the job. Using a rifle approach means you’ll have to say “No” to some people. This can cause problems. When possible, explain why you’re declining to act on the problems or the specific issues others may present to you. The more transparently you operate, the less criticism you will face. Openness reduces speculation and helps avoid resentment.

4. Don’t job hop. Most people can be very ambitious early in their careers. Yet too much ambition can hurt your career. Think long and hard before changing jobs. Bad bosses rarely outlast their employees. Deciding to change jobs because of a conflict with a supervisor is often short-sighted. The grass might seem greener on the other side, but sometimes that’s because of a septic tank (to paraphrase a famous comedian). These questions may help you avoid rash decisions.

  • Am I making the change solely to earn more money or for a more prestigious title? If so, will this change “pay for” what I will lose?
  • Am I making the change because I’m feeling unchallenged or bored? If so, what steps can I take to make my current job more challenging? For example, would becoming more active in a trade association, offering your expertise to a local non-profit, or mentoring an up-and-coming risk management professional add challenge and interest?
  • How will this impact my retirement financially? Will I be changing retirement systems or will I lose significant bonuses or vacation due to the change? Always factor those figures into the salary decision. This question becomes more important as you edge closer to retirement age.
  • How will this change impact my family and my coworkers? Our coworkers can turn even a challenging job into an appealing one. Do you really want to leave your coworkers? As for family, what ages are your children? Disrupting school-aged children can be very problematic and have negative, long-term consequences.
  • What are the odds I will regret this decision? Go ahead, we’re numbers people. Put a percentage to your decision then ask yourself if you’re really ready to take that gamble.

It takes months to settle into a new job. It’s often a year or more before we feel comfortable. Some studies show that many people who change jobs would have done much better if they had stayed put longer. Change for the sake of change frequently is not positive.

5. Don’t entertain gossip about your predecessors. Some at your new organization may try to build an alliance with you at the expense of your predecessor. Short-circuit these conversations whenever possible. Tactfully turn the conversation to another subject or excuse yourself from the conversation. Try not to make an enemy of the person who is trying to get into your good graces.

6. Don’t revisit your predecessor’s decisions. Especially when working with unions, you may find people lined up at your door asking you to revisit your predecessor’s judgments. Unless your predecessor’s conclusions negatively impact your overall program, don’t rush into undoing the decisions and the work he or she completed. You may not be operating under the same set of facts or with the same long-term vision that former risk manager had at his or her disposal.

7. Don’t believe your own PR. Never pretend you know more than you know and don’t start believing your own “press.” While others may soon invite you to participate on panels and present at conferences, remain humble and teachable. It’s terribly painful to learn humility through humiliation.

8. Don’t fail to communicate. A lack of communication is one of the most damaging mistakes a risk manager can make. A risk manager must have the ear of employees across the organization, from line supervisors to senior management. According to Don Donaldson, President of LA Group, a Texas-based risk management consulting group, “A risk manager needs to be an excellent communicator and facilitate his or her message across the entire organization. In my mind, that requires getting out of the office and pressing the flesh; seeing and being seen and listening, really listening, to determine what is going on in the organization.” Management by walking around is one strong tool in a new risk manager’s tool bag. Once people see that you’re willing to leave your office to discover what is happening, whether it’s on the shop floor or on the sewer line, they’ll more readily accept your expertise and counsel.

9. Don’t get discouraged. “New risk managers may make the mistake of thinking that risk management is as important to others in the organization as it is to them,” according to Harriette J. Leibovitz, a senior insurance business analyst with Yodil, Inc. “It takes time, and more time for some than others, to figure out that you’re more than an irritation to the folks who believe they drive all the revenue.” Over time, you will prove your value to the organization many times over. Until that day, quietly do your job and find encouragement from your risk management peers.

10. Don’t forget to laugh. You will be privy to the peculiarities of human nature both at its finest and at its worst, so don’t forget to find the lighter side of situations when you can. A robust sense of humor will help you through the rough spots and build bonds with your coworkers.

While these are just a few tips to help you in your new role as a risk manager, your peers probably can offer many more ways to ensure success. Over my career in risk management, I have found my fellow risk management professionals to be some of the most generous people in my life, always willing to share their expertise and provide me with a helping hand. Develop and lean on your network.

If this is your first job as a risk manager, you’re in for a wonderful experience. Take time along the way to enjoy the experiences, appreciate the great people you will meet and appreciate the lighter side of risk management.

How to Manage Today’s Insurance Professionals


I recently spoke with risk management consultant and former insurance agent Dan Weedin, author of Insuring Success. Weedin and I share something in common: A passion for the insurance industry and a concern that today’s top insurance talent is disappearing. We talked about some of the challenges facing agencies and insurers as they try to align staffing needs with retiring talent.

As millions of Baby Boomers retire within this decade, the industry’s talent crisis is real. An added area of concern for insurance organizations is that many of those “Boomers” are deciding whether they should take that last chance and change careers. “Burnout, disgust, and unhappiness in one’s job will lead to change, especially at an age when timing is of the essence,” Weedin says. As these long-tenured and valuable employees leave, so do all their “smarts” that organizations accumulated over the span of their working career. That is how an organization can lose its memory and suffer from what Weedin refers to as “institutional amnesia.”

Can the insurance industry solve this problem? Yes, according to Weedin, but organizations must begin immediately to develop a solid strategy and execute a talent management plan. Here are several changes he suggests organizations can make.

  • People are tired of “working for the man” and are seeking new opportunities. “Companies have done this to themselves,” Weedin believes. “Command and control leadership tactics won’t work any longer. Collaborative cultures are much better. Business guru Peter Drucker once said, ‘Culture eats strategy for breakfast.’ It’s about the culture and how people contribute that makes a difference. The rewards go far beyond the financial. Employees must be challenged and continue learning to stay with an organization for the long-term.”
  • Pay special attention to Boomers between the ages of 50 and 60. Later Bloomers are making employment changes, according to Weedin. “They’ll either start their own companies or look for employers that offer value-added employment for them. You don’t engage employees through command and control. To attract these employees with the technical knowledge so desperately needed in the insurance industry today, a more collaborative and flexible workplace is imperative.”
  • Insurers are slow to react to market changes and slow to react to make changes in their culture. The result in the industry is the merging and acquisition of companies, which can be problematic. This paradigm shift needs to occur quickly, or insurers will find themselves in constant “catch up” mode, losing valuable ground.
  • Create an environment of collaboration. Develop areas where employees from different departments can converge and communicate. There is plenty of research that shows that happy, more connected employees are better workers that stay longer and improve the company and its bottom line.
  • It is difficult yet imperative to find and keep good talent. The most profitable companies tie compensation to underwriting success, which can only be achieved with help from the claims department. Accurate data input by claims personnel allows cleaner underwriting profit analysis by insurers.

Innovative insurance companies are making major changes to cope with the tidal wave of retirement. Consider moving away from cubicle seating and into more open workspaces. Question the traditional departmental seating in favor of more open and collaborative workspaces. It’s working in high tech, and it would work wonders in the insurance industry. Consider placing rows of adjusters between underwriters and sandwich in other departments to encourage cross-pollination. Underwriters see the results of their work in action and claims people can discuss coverage intent and coverage language. Open seating increases a company’s intellectual capital. By nature, most humans want connection in the workplace, especially the new pack of millennials entering the workforce who grew up with coaches, mentors and social media. Allow them to fulfill these needs by creating a culture of collaboration and affiliation.

In today’s competitive environment, a one-shot leadership event will not deliver the changes your organization needs to remain competitive. Moving forward in this century’s business climate, insurance organizations must develop an intentional strategy to develop intellectual organizational capital, invest and empower employees and create a culture that rewards all employees. The results, according to Weedin, are fewer headaches, happier employees who stick around, and ultimately, increased profitability. Companies that fail to find that balance between empowered employees and profits will ultimately fail.

Avoid a Copyright Infringement Allegation by Using Only Purchased or Creative Commons Graphics

Every artist is entitled to make a fair profit on his or her work. You may consider that image you grabbed off the web “just a picture.” In fact, the artist may have worked hours on that image or graphic. Not only is it cheaper in the long run in you avoid litigation, it’s the ethical thing to do.


I visited a local social media networking group in Phoenix the other night. The [mis]information provided by the “expert” regarding the use of images in social media posts was scary. The group coordinator assured these fledgling bloggers and posters that as long as they don’t have a call to action in their post, they can use any image they find on the internet. After all, they were “educating” the public. Wrong!

According to Ruth Carter, owner of Carter Law Firm in Phoenix and the author of The Legal Side of Blogging: How Not to Get Sued, Fired, Arrested or Killed, “A lot of people think you can use any image you find online as long as you provide an attribution and a link back to the original, but that’s not true,” Carter said. “What you might be doing is committing copyright infringement and making it easy for the artist to discover that you stole his or her work.

“When a person takes a photo or creates a graphic, they own the copyright in it. This means they have the exclusive right to control where others can copy and distribute that image. If you use their work without their permission, you could be committing copyright infringement. If you get caught, if you’re lucky you might get a cease-and-desist letter or a DMCA takedown notice. However,” Carter continued, “they could send you a bill for using their work or they could sue you. In the worst-case scenario, you could be sued for up to $150,000 per image plus the artist’s attorneys’ fees. And it doesn’t matter than you didn’t know that you were committing copyright infringement when you did it.

“If you need images for your blog or website, use images that come with a Creative Commons license, preferably one that allows you to modify and commercialize the image,” Carter recommends.

To prevent needing a $300-plus an hour lawyer to defend yourself against a copyright infringement allegation, use images with creative commons attribution or purchase images from legitimate vendors.

Every artist is entitled to make a fair profit on his or her work. You may consider an image “just a picture.” In fact, the artist may have worked hours on that image or graphic. Not only is it cheaper in the long run if you avoid litigation, it’s the ethical thing to do.

Should We Use Stamps or Metered Mail in Marketing Mail?

ElvisOne Christmas I was in a long line in the post office in Garden Grove, California. An elderly woman was in line in front of me and when she finally got to the counter, she ordered a book of stamps. After her request, she qualified her statement by saying with a great deal of irritation, “And none of those darn Elvis stamps, either!” Everyone within earshot tried not to laugh out loud.

While bulk mail may save a few pennies, I always use a real stamp. In fact, I often get creative and use stamps with themes or beautiful pictures just to draw the letter opener’s eye to piece.

If we can help you write copy that will produce sales, contact us at 602.870.3230.

We help agents, carriers and insurance thought leaders throughout the US with their blogging, marketing and ghostwriting efforts. Why not call for a free consultation? With over a quarter century in the insurance industry, we understand your business.

More WordPress training to help you optimize your insurance marketing results!

Did you know that about 20 percent of today’s websites and blogs are developed on WordPress?

I’m taking more WordPress training today so I can continue to help you deliver stellar social media results. Small changes to the way you handle your social media tasks can really help improve search engine results for your business.

We will cover some tips for WordPress users in the near future.

How Long Should Sentences and Paragraphs Be in Business Writing?

As agents, consultants and claims people, we should write in top form before we send that letter or publish the final draft of our blog. Here are a few tips on sentence and paragraph length.

There is a lot of poor writing out there on the web. Even in professionally written White Papers and blog entries, there is lots of room for improvement. As agents, consultants and claims people, we should write in top form before we send that letter or publish the final draft of our blog. Here are a few tips on sentence and paragraph length.

The “eye likes white space.” If you mail a letter or publish a blog without adequate paragraph breaks, readers will quickly lose interest. Creative use of white space encourages the reader to dig in and begin reading, then refuses to intimidate the reader along the way.

How long is a sentence?

Most writing experts agree – use concise sentences in business writing. Strive for an average of 15-to-20 words in even the most technical documents. However, good writing uses varied sentence length. If you write all 10-word sentences, your work would be choppy. If you use all 20- or 25-word sentences, the reader will soon lose interest. Vary sentence length and strive for an average of not more than 20 words per sentence. Briefer is better. A four-word sentence that is informative is perfectly acceptable. “Risk management maximizes profits” speaks volumes in four words.

How long is a paragraph?

A paragraph is a relatively short block of text that opens with a statement—a topic sentence—which describes what the paragraph contains. Many writers, even experienced ones, tend to stray toward lengthy paragraphs. This is a mistake. Strive to average less than 100 words per paragraph. Also keep formatting in mind, because if you format using more than one column per page, your paragraphs should be even shorter.

Remember these three rules for better business writing:

1.       The eye likes white space

2.       Sentence length average: 15-to-20 words maximum

3.       Paragraph length average: Less than 100 words

Is Enterprise Risk Management Still Important to Today’s Organizations?

Governance, Risk & Compliance (GRC) framework can provide strong benefits to organizations, helping to integrate and manage regulated operations. In this survey sponsored by Corporate Governance Consultancy Services, 33% of respondents shown in this infographic state that enterprise risk management is the most important. 27% of the respondents say that enterprise risk management continues to be important. For more details please visit



GRC Software | ERM Software
Courtesy of: CAREWeb

Expressing Professional Gratitude

Today, though, I urge you to take a moment to contact a person in your career for whom you are grateful, either past or present, and say, “Thank you.”

This year my women’s group, which has been meeting once a month for our third year, is reading and discussing a book by Amanda Gore, The Gospel of Joy. I heard Ms. Gore speak at a teleconference last year and her highly personal presentation really hit my core beliefs.

Her book is perfect for a study group since there are twelve chapters in the book, one for each month. Each chapter explores a different spiritual principle, for example, listening, laughter, hope and gratitude. Gratitude has always been my struggle. I sometimes say, “My glass isn’t only half empty; it has a hole in it.” In other words, I have to work to stay grateful.

One of the questions in her gratitude chapter hit home with me. It asked, “Did your parents’ behavior model gratitude?” I can easily say that, “Yes,” their behavior did. Both my parents were independent insurance agents and both people of strong faith. My father, a Lutheran, served in his church as a council member and all-around fix-it guy. My mother, a more reserved Catholic, quietly put her faith into action by volunteering for years at the Westside Food Bank. Their motto in business was “Service before self” and while they were very successful insurance agents, they never let profit interfere with doing the right thing.

I grew up with three older brothers and one of us, usually me or my brother, Ted, was always wrecking a car. (I was quite sure my father owned an interest in the local body shop he insured.) After our accidents, my father would assess the damage then quietly say, “Everything happens for the best.” Frankly, at the time I thought he was slightly mental.

“Dad,” I finally asked when my brother ran his Mustang into a ditch at the end of our street, “How can a car accident ‘be for the best’?”

“Perhaps this minor accident where no one was hurt saved him from a major collision. After all, cars we can fix. You and the boys are irreplaceable.” Dad could always put things into perspective for me. I am so grateful for the wonderful lessons my parents taught me.

This story leads me to my topic – professional gratitude. There are so many insurance gurus who have mentored me over the years, from one of my first bosses at Commercial Union – who predicted, “Ms. Germond, in five years you will be a claim manager,” and I was – to the many risk managers who helped me when I was a fledgling risk manager, never an easy job.

Over the years I have trained and mentored my share of risk and claims professionals. Rarely do they thank me. I’m not dismayed by this; I rarely think of it because at some level, I am sure they are grateful but unaccustomed to expressing gratitude verbally. Today, though, I urge you to take a moment to contact a person in your career for whom you are grateful, either past or present, and say, “Thank you.” I guarantee you: This will mean a great deal to him or her. 

As many of you know, for years I have alternated between running Insurance Writer full time and working more directly in the insurance industry. I just couldn’t stay away from a challenge. But I also know there is more to life than a paycheck. This year, I’m putting it all on the line to branch out, utilizing my God-given gifts to provide specialized services to the insurance industry.

If you’re interested in learning more about Ms. Gore, here is a link to her YouTube channel. If I can help you, these are some of my areas of specialty:

  • Copywriting, including White Papers, advertising copy, articles, ghostwriting and blog entries
  • Consulting with small-to-medium sized businesses to reduce losses and improve workers’ compensation programs
  • Curriculum development and on-site training, including:
    • Customer service training
    • Workers’ compensation claims management training
    • CGL coverage training
    • Business auto training
    • On-site Associate in Claims training
    • Miscellaneous management training

Please feel free to contact me at (602) 870.3230.


Why Does My Insurance Company Hate My Dog?

It’s time for the insurance industry to wake up and smell the dog food. A more nuanced approach to pet underwriting is a win/win for the industry and for pet lovers everywhere.

dog liabilityProperty Casualty 360 and other industry magazines report escalating dog bite settlements. The industry is moving to endorsements and policy language to exclude canine liability. Why doesn’t the insurance industry take a more analytical approach to underwriting household dogs? As dog trainers will tell you, aggression is not breed-specific. Almost any dog improperly socialized, or with dog aggression in its line, will bite. I’ve seen American Kennel Club-elite Labradors, one of the friendliest breeds, that will take a chunk out of you, and German shepherds that wouldn’t bite you if it would save their own or their master’s life.

Rather than deny coverage by breed, why not partner with the American Kennel Club (AKC) and use the Canine Good Citizen program as an underwriting guideline? The Canine Good Citizen must pass 10 temperament tests – for example, allowing a stranger to approach, demonstrating a lack of dog aggression (very important since so many people get bitten when their people-loving dogs tangle with other, not-so-dog-friendly pooches), and the dog’s reaction in a crowd. Evaluators are available in hundreds of locations throughout the United States.

People who love their dogs would happily dole out the small cost associated with their dog’s evaluation rather than face no insurance. This is not a blanket endorsement of the American Kennel Club. However, their Canine Good Citizen certification is a strong indicator of Fido’s friendliness and steady temperament.

The insurance industry has always adapted coverage to meet the needs of a changing society. Dog ownership is not changing; in fact as crime rates escalate, more Americans turn to dogs for their safety. Underwriters do not understand canine temperament. Instead, there has been a knee-jerk reaction to exclude one of our home’s best protectors against burglars, and many Americans’ best friends. Simply, insurers refuse to take a more nuanced approach to underwriting dogs. Using the Canine Good Citizen is a solid approach instead of a blanket exclusion by breed. It might take some time to develop the partnership with the AKC, but in a previous discussion I had with a staff member at the AKC, they are eager to help. 

Americans love their dogs. And dogs will not go away. Instead, more owners will deny they own an excluded breed and insurers will be stuck in coverage battles that will do nothing to further the industry’s image. Additionally, messing with America’s best friends will do nothing to improve the industry’s always struggling image.

It’s time for the insurance industry to wake up and smell the dog food. A more nuanced approach to pet underwriting is a win/win for the industry and for pet lovers everywhere.


Associate in Claims 40, Personal and Commercial Auto Coverages Class Available Online

I’ll be teaching the AIC 40, Personal and Commercial Auto Coverages, online beginning February 20, for Prepademy. Visit this link for more details. Remember, your professional education is something no one can take from you.

Join us for a great classroom (online) experience!

What Does 2014 Hold for Insurance Rates?

With 2014 rapidly approaching, contact your broker or consultant now to discuss steps you can take to reduce your 2014 commercial premiums.

What can you expect for property and casualty insurance pricing in 2014? Expect some increases, but watch for significant decreases in at least one line of insurance. According to Willis’s recently published Marketplace Realities 2014, new capacity is flooding the market from “as widespread as China and Omaha.” New capital supply offers a more “inviting marketplace,” Willis executives believe. Others insurance experts across the U.S. agree. Here is what to expect in 2014.

Primary and Excess Casualty

Do not expect huge decreases in casualty prices even with “abundant” capacity and “new market entrances,” according to Willis and other experts. With the loss of the federal terrorism backstop looming in December 2014, carriers hesitate to write exposures with large risk concentrations. Underwriters are also avoiding manuscript endorsements, relying more heavily on Insurance Services Office (ISO) language. Standard ISO language has more court decisions behind it, which equates to more predictable loss experience for underwriters to base their rates, many believe. Willis predicts casualty pricing to increase two to 10 percent in 2014.

Auto and Fleet

Auto liability continues to challenge fleet owners nationwide. Experts predict auto liability pricing increases between two to 10 percent. Underwriters are imposing higher retentions on risks with large fleets, heavy trucks or poor loss experience. Carriers like ACE offer auto liability buffer limits, coverage outside the working layer when primary limits do not meet umbrella attachment points.

Workers’ Compensation

There are several emerging issues in workers’ compensation. With the Affordable Care Act expected to bring new insureds into the healthcare system, expect strains on the work comp system. This will put pricing pressure on workers’ compensation premiums. While experts predict that earlier treatment for comorbidities will benefit workers’ compensation experience, we predict this will be a long-term benefit. In the near term, Willis predicts work comp rates will increase from 2.5 to 10 percent. The exception is California, where employer can expect rate increases of up to 20 percent.

Employment Practices Liability (EPL)

Adverse claims experience is placing upward pressure on EPL coverage. Entities domiciled in certain California counties may find themselves unable to obtain coverage, Willis predicts. While overall capacity remains “abundant,” there are no new EPL carriers entering the market. Pricing overall will be flat to a 10 percent increase, with private, nonprofit and smaller employees predicted to face up to 15 percent increases. The Equal Employment Opportunity Commission continues its aggressive enforcement plan despite some staggering trial losses for the EEOC in 2013. There is no time like the present to explore ways to decrease your EPL risks and avoid EEOC scrutiny.


When Cyberrisk gets its own page in a white paper discussing rates, you know it is a hot topic among insurers and risk managers. There were more than eight hacking incident per day in the US in 2012 according to the report. With increased security concerns, coverage is now a “must have” for many organizations. Calling the market for stand-alone Cyberrisk “active,” Willis predicts rates will remain competitive. If your firm has had losses, however, Willis predicts slight changes — between -two to five percent overall. There are many new Cyberrisk buyers in the marketplace and pricing for first-time buyers remains competitive. If you outsource your data to cloud vendors, underwriters will review your existing contracts. Your indemnification language will be a critical factor in underwriting your risk.

Directors & Officers (D&O)

Price increases are moderating with pricing expected to be flat to a high of 20 percent for financial services firms. Homeowner and condominium associations as well as educational institutions should expect premium increases. One carrier has indicated a willingness to provide “mega limits” for Side A coverage, which protects executives against claims not indemnified by the corporation. The non-traditional money that is now flooding the insurance industry may lead to downward pressure on D&O pricing in 2014, Willis contends.


We saved the best news for last. With loss ratios hovering between 75 and 85 percent for many property insurers, Willis and other insurance experts predict a big decrease in property insurance pricing. In non-catastrophe exposed risks, expect a 10 to 12.5 percent decrease in pricing. For cat-exposed property, Willis predicts smaller decreases of between five to 10 percent. Any port in a storm, right?

With 2014 rapidly approaching, contact your broker or consultant now to discuss steps you can take to reduce your 2014 commercial premiums.

Writing an Executive Summary in an Insurance Publication

A well-written executive summary also allows your reader to decide: “Is this worth reading further?”

Whether you’re writing a proposal or preparing a white paper, an executive summary is an integral part of any lengthy or complex report. An executive summary allows the reader to quickly understand the scope of the report, your major finding and your conclusions. It is a succinct wrap-up of the report or proposal’s contents. Because time is such a precious commodity, people who should read an entire report may only skim it. The executive summary allows the readers to know, in one or two paragraphs, what to expect in the report. A well-written executive summary also allows your reader to decide: “Is this worth reading further?”

The executive summary should be very near the beginning of your document and set out by a heading and unique formatting. If you know your presentation will be read by many employees, for example if you’re responding to a Request for Proposal (RFP) for broker services, write the executive summary to the highest ranking person who will read your report.

In the executive summary, avoid the nuts and bolts of how to implement a project, but provide an overview of the problems being addressed, what action to take, and what the benefits of taking that action are.

Your executive summary should be a call to action. Use action phrases such as “We recommend” or “The problems you have faced in prior data conversations can be avoided by utilizing our project management experts.”

Broadly speaking, an executive summary should do the following:

1. Tell your readers what your report contains or what it evaluates.
2. Explain any method of analysis you used.
3. Summarize your findings.
4. Succinctly state your recommendations.
5. Briefly state any limitations you encountered that might have impacted the results of your report.

It may be a good idea to write your executive summary after you have written your report. When you have completed your report or proposal, use a voice recorder and summarize each section of your report. For example, in a white paper, you may have headings such as “problems of integrating technology,” “what to look for in a claims management system,” and “what to expect during data conversion.” Briefly describe the findings of each major section in your white paper, with a strong emphasis in your executive summary of the conclusions that your company, of course, is best positioned to solve. Keep your summary brief — an executive summary should probably be fewer than 1,000 words.

If you’re pitching your product or service to a large organization in your document, the executive summary may be the only part of the presentation that the decision makers read. From there, your report may be passed to lower-level managers to determine whether your proposal has merit. You may only get one shot at convincing a senior executive that your company or product is worth further exploration. A strong executive summary can mean the difference between winning that new account or losing it to your competitor. The extra efforts you apply to develop this summary can reap huge rewards.

We provide editorial services to some of the nation’s finest carriers, agents and risk management consultants. If we can help you, please contact us at 602.870.3230 to discuss your writing and editing needs.

Cavalcade of Risk #192 Gallops Into View

Cavalcade of Risk #192 gallops into view with some interesting risk-related posts and great advice from various risk experts in their specific fields, from life insurance to enterprise risk management.



Excuse the slightly tongue-in-cheek lead-in, because this week’s Cavalcade of Risk is full of great risk management information. We visit a variety of risk management experts for their take on current events impacting their practices. Take a few minutes, grab a cup of coffee and visit and interact with our contributors.

In this post, Dr. Sidorov looks at a recent scientific study that examined national insurance data to determine what happened to the commercial health insurers in the wake of the Obamacare rule that they spend at least 80 to 85 percent of their income on medical care. It turns out that the most vulnerable part of the health insurance market-individual insurance-saw a decrease in profitability.

Jeff Rose helps us through the maze of medical conditions that can limit your ability to buy health insurance in his post. If you have an aortic valve disorder like aortic stenosis or aortic insufficiency, these conditions will impact you when you apply for life insurance. Insurance companies are very cautious about aortic valve disorders because of their potential to cause serious heart problems. There is hope, however. Jeff informs us you can still get insurance despite your condition. It really depends on a few factors, including the seriousness of your condition. To get a better idea of what to expect, read his guide to insurance underwriting for aortic valve disorders.

Here’s a news flash: If you are uninsured, there is a risk of being overcharged for hospital services. In California, the risk is 0. Jason Shafrin of The Healthcare Economist explains why here.

Recently, there have been some remarkable changes in how life insurance is now underwritten, including the use of social media and new technology. Henry (Hank) Stern of InsureBlog has the details.

Julie Ferguson of Workers’ Comp Insider isn’t talking scratch when she asks: “How much risk do you want to take with your kids’ chicken nuggets?” Chickens are on the front burner on the legislative circuit lately with the USDA seeking to overhaul poultry processing regulations that many see as unsafe for workers. But Julie notes that there is more than just worker safety at stake. Read her fast take on fast food here. I would have said, “Winner winner; chicken dinner.” Except after reading her post, and watching the video, I may go vegan. Soon.

David Williams of Health Business Blog says that a patient advocate tells him that it’s “dangerous” to rely on online doctor ratings and reviews and to rely on the “facts” instead. David argues that the case against reviews is seriously overrated and the proposed alternative paths are not as promising as they sound. Read his comments here. I have to admit, I’m a big believer in Yelp and a frequent Yelper myself. I don’t go out to dinner without checking Yelp, let alone try to find a service provider, doctors and dentists included.

Here are some closing thoughts from yours truly regarding the trends I and other risk management experts throughout the US are currently seeing.

  • Enterprise risk management is becoming increasingly important to organizations.
  • Jury verdicts continue to rise. Check your liability limits and double check your policies to determine if you have defense inside or outside limits. Most professional liability policies provide defense within limits, and defense costs can erode your limits significantly.
  • Workers’ compensation costs have moderated in a few states; however, don’t expect to see rates decrease anytime soon, like never. Medical costs continue to escalate nationwide, outstripping wage loss benefits paid.
  • Cyber risks continue to be the bane of businesses at home and abroad; however, hackers increasingly target small-to-medium sized businesses because they seem to provide the path of least resistance to hackers.
  • Commercial insurance prices increased by six percent in the second quarter of 2013, the 10th consecutive quarter of price increases, according to a recent survey conducted by Towers Watson. Now is the time to bulletproof your risk management practices and consider increasing your deductibles or taking higher self-insured retentions.

This does it for another edition of Cavalcade of Risk.

Take the Associate in Claims Class AIC 37 Online and Earn Your AIC Designation

I’m teaching the revised curriculum for The Institutes Associate in Claims Class, AIC 37, Managing Bodily Injury Claims, for Prepacademy, an on-line learning organization that provides an outstanding way to prepare for and pass your exams.

It’s not too late to join us! I’m teaching the revised curriculum for The Institutes Associate in Claims Class, AIC 37, Managing Bodily Injury Claims, for Prepacademy, an on-line learning organization that provides an outstanding way to prepare for and pass your exams.

We began last night, but have a week breather. Our next AIC 37 class covering Chapter 2 starts on Thursday, September 26. It’s not too late for you to join. You can also listen to the recording from Chapter 1 to catch up before our next class. For more information about this exciting web-based training opportunity, click this link.

We’re just winding up the Workers Compensation portion of the AIC. Prepademy is a convenient and easy way to successfully study for your Associate in Claims and other Institutes designations.

Journalists Covering Insurance can Benefit from Free Handbook

The Insurance Information Institute offers a free, 200-plus page handbook for journalists who cover insurance. It’s available as a free download at this link. While it can be hard to understand the intricacies of insurance jargon and how the industry operates, this guidebook answers many questions and provides a handy reference to various organizations who can assist journalists with more information.

Defining and Achieving Maximum Medical Improvement in Workers’ Compensation Claims

Achieving Maximum Medical improvement in a workers’ compensation claim may not be easy, but it is one of the most important goals in claims management.

Maximum medical improvement (MMI) is a term used frequently in workers’ compensation claims management. Often, your adjuster will explain that a case is not ready to settle because your employee has not “reached MMI.” What is MMI? From the employer’s viewpoint, achieving MMI is one of the most important goals in a workers’ compensation claim. MMI is the point at which treatment options have been exhausted and, generally speaking, temporary total disability payments can be terminated. MMI may also be referred to as “permanent and stationary.”

Case law varies in defining MMI

Case law in various states defines MMI in a variety of manners. In Ohio, for example, MMI is defined statutorily as “a treatment plateau.” In California, the Division of Workers’ Compensation defines MMI this way: “Your condition is well stabilized and unlikely to change substantially in the next year, with or without medical treatment. Once you reach MMI, a doctor can assess how much, if any, permanent disability resulted from your work injury.” Texas defines MMI statutorily as “the earliest date after which, based on reasonable medical probability, further material recovery from or lasting improvement to an injury can no longer reasonably be anticipated.” MMI will vary depending on the claim’s jurisdiction.

MMI – “As good as it gets”

The common thread of both case law and lengthy discussions attempting to define MMI is this – the employee is at a treatment plateau: his or her medical condition will probably not substantially improve. MMI then, might be described this way: “This person’s medical recovery is as good as it gets.”

Does MMI mean the employee can function at his or her pre-injury status? Not necessarily. Even if the employee has not reached his or her pre-injury status, however, the employee can achieve MMI. Some states such as Texas are very clear in stating that an employee’s recovery need not be equal to or better than the pre-injury state.

Defining MMI may be clearly defined in statute, but getting your doctors to declare an injured employee at MMI is not always straightforward. One way to determine if an employee is MMI is to send a nurse case manager with the employee to the medical provider. The nurse should ask this important question: “Is the employee’s recovery as good as he or she will get?” If the doctor says, “Yes,” then obtain a written opinion to that effect and begin the settlement process.

Lack of cooperation in treatment can be managed

What about the claimant who refuses to cooperate in his or her recovery? All reasonable treatment must have at least been offered to the employee. There are times when further diagnostic testing and evaluation are deemed medically reasonable and necessary. It may later be determined that no further treatment would benefit the claimant, or where further treatment is identified and the claimant refuses the treatment. In that intervening time until the employee refuses treatment, the claimant has, in many states, not reached MMI and the employer still owes benefits. Only when treatment is recommended and refused, or not undertaken within a reasonable time, has an injured worker reached MMI. For example, a consulting surgeon may recommend a back fusion; however, the employee declines surgery. In this case, the claimant has usually reached MMI and your claims administrator can begin to conclude the case.

Pressuring the employee for a quick decision on surgery may push the employee to obtain an operation he or she would otherwise refuse. If may be best to give an employee a few weeks to consider his or her decision to obtain further treatment rather than insist on an immediate answer, even if it means paying a little more in temporary disability.

Chronic pain and MMI

Many injured workers allege chronic pain. Chronic musculoskeletal disorders and diagnoses such as arthritis and fibromyalgia impact workplace injuries. In most cases, if the employee’s pain would be materially improved by participation in a pain clinic or pain program, the injured worker has not reached MMI. A patient with chronic conditions may require continuing treatment to maintain his or her recovery or to avert any further deterioration. However, if further treatment is directed solely to maintenance of the patient’s condition and there is no likelihood of further improvement, the patient is at MMI.

The most difficult situation is when the employee’s symptoms fluctuate dramatically. These employees will complain of “good days” and “bad days.” These types of symptoms are troublesome and often delay MMI; however, fluctuation alone is immaterial to a decision of MMI. When symptoms fluctuate, the time it takes to determine whether the patient is at MMI may increase. However, the underlying reasoning remains the same: if the patient has plateaued or the number of good days is growing, consider the patient MMI and begin the settlement process.

However, before deciding MMI has occurred because the employee has had no continuing substantial improvement, the adjuster must offer all “reasonable treatment.” Reasonable treatment does not include experimental procedures. Reasonable treatment usually means treatment that is based on evidence-based medicine guidelines such as the Official Disability Guidelines. With alternative treatments plentiful, employees may want try therapies with only anecdotal track records of success. Just because there are untried treatments available, this does not make them reasonable. Treatment options should be evaluated on a case-by-case basis. When addressing requests by employees for alternative treatments, solicit the treating physician’s opinion in states where employers can direct medical treatment.

MMI is an often subjective and always an important goal

Reaching MMI is subjective and often a time-consuming and sometimes frustrating process. A great deal of state-specific case law concerning the definition of MMI provides some guidance. If you are in doubt, your claims adjuster or legal counsel should assess the likelihood that your employee’s condition has stabilized to the point of MMI. If so, your adjuster or legal counsel should begin to immediately attempt to settle the claim.

Take the New and Improved Associate in Claims 37 Class

In conjunction with Prepademy, I’ll be teaching the revised curriculum for The Institutes Associate in Claims Class, AIC 37, Managing Bodily Injury Claims, beginning August 28, 2013. For more information about this exciting web-based training opportunity, click this link.

We’re just winding up the Workers Compensation portion of the AIC. Prepademy is a convenient and easy way to study for your Associate in Claims designation.


Germond Recertifies in Human Resources

Germond re-certifies her Senior Professional in Human Resources certification.

As part of my dedication to continuing education, I recently received my Senior Professional in Human Resources (SPHR) re-certification. This renewal of my SPHR certification means that I stay current in human resources issues facing today’s business owners and claims departments.

The SPHR is the industry gold standard among human resource professionals. I keep up-to-date in this important area for two reasons: 1) because SPHR training supports me in becoming a more skilled curriculum developer and trainer and 2) because a lack technical talent both in the US and abroad impacts the insurance industry now and will even more so in the coming decades. 

Cut Rate Auto and Homeowners Insurance May Cost You

Cut rate auto and homeowners insurance may cost you big in the long run.

You no doubt frequently receive solicitations and ads from insurance companies promising to save you money on your auto or homeowners insurance. Most consumers are looking at each expense they pay to cut costs. However, buying cut-rate insurance may cost you much more in the long run.

Insurance is your first line of defense against life’s calamities. After a loss, these are just a few of the problems a good insurance company can help you solve.

  • Provide prompt and courteous service year round after a loss.
  • Provide knowledgeable adjusters who can assist you in making important post-loss decisions.
  • Find a top-rated repair shop to repair your damaged car.
  • Promptly and conveniently provide a replacement vehicle while your vehicle is in the shop if you purchased rental coverage.
  • Pay for a similar alternative living space if you are unable to occupy your home after a loss.
  • If you are sued after a loss, provide a strong defense with excellent legal counsel.
  • Provide prompt board-up services after a loss.
  • Help you locate a trustworthy contractor if your home or roof is damaged.

Cut-rate insurance carriers cost less because they generally provide fewer services and less coverage. The decision to purchase insurance should go beyond price. Protection for your home and family after a loss is priceless.

Several of my friends have recently been involved in auto accidents and found themselves lacking rental reimbursement coverage and gap coverage. Gap coverage helps make up the difference between a totaled new car and its depreciation if the vehicle is damaged while the owner is still “upside down.” A good independent insurance agent can help you avoid these necessary coverage gaps. 

Don’t get suckered into buying insurance solely based on the lowest premium. If you have a loss, cheapest may cost you.

The AIC 44 Workers Compensation Claims Practices Class Begins May 23

I’m teaching the new and improved Associate in Claims class, AIC 44 Workers Compensation Claims Practices, on-line at Prepademy. This class begins Thursday, May 23 at 5 p.m. Pacific time.

Register with Prepademy for a great preparation for the AIC 44 class. Visit this link for more information.

As a former workers compensation claims manager, I love teaching this class, especially in its new, streamlined format. And if you miss the live presentation, Sandy Masters, the owner of Prepademy, makes the classes readily available on line so you can view them at your convenience.

We hope you can join us!