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Category: Insurance Writer
Risk Avoidance and What the Heck is Wrong With People?
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?
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. This type of debt can be harrowing and worrying for so many millenials, that’s why some may turn to CreditAssociates to help them get out of this crushing time.
- 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.
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.
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.