A View from the Press Box

Unless you believe global warming is just another one of those crackpot scientific theories–you know, like evolution and gravity–you’ll find NU Associate Editor Mark E. Ruquet’s recent column on climate change–”Insurers Can’t Afford To Give Global Warming The Cold Shoulder,” a fascinating read. Mark raised some interesting challenges for insurers, which are literally paying the price for global warming in terms of higher disaster losses.

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It’s time once again for independent agencies that do an outstanding job selling insurance and providing risk management services to prepare their entries for the National Underwriter “Commercial Insurance Agency Of The Year” award. For the sixth straight year, agencies that are role models for their peers—running successful sales organizations while serving as risk managers for their commercial clients—will be given national exposure via NU’s prestigious program.

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In our latest “Question Of Ethics” in this week’s edition of NU (available online as well), we asked readers to tackle the dicey problem of how to reconcile potential conflicts that inevitably arise these days over any sort of contingency fee agreement. That argument might be moot if all carriers eventually end such bonus arrangements, but I cannot imagine there won’t be other incentive compensation plans to take their place, which will raise their own conflict-of-interest issues.

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Recently I received a handful of e-mails from readers annoyed with me for “showing my true colors” by expressing views normally heard in more “liberal” publications. I’ve included my exchanges with them as comments on this entry, to help shed light on my thinking for those who may have been equally pissed off, but didn’t want to bother writing to tell me so.

Was State Farm–its longtime advertising claims to the contrary–not a good neighbor when it came to dealing with the multitude of Hurricane Katrina claims in Mississippi? Did this really have to end up in court? Or should the carrier have been more proactive and flexible in adjusting claims where the source of normally excluded water-related damage was less than clear?

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It’s the insurance industry’s worst nightmare–Congress seriously considering a bill to repeal its longtime exemption from federal antitrust laws. The mood on Capitol Hill towards the industry is ugly these days, in the wake of alleged mishandling of Hurricane Katrina claims. What do you think would happen if both the Justice Department and Federal Trade Commission were given authority over insurers? Would it seriously hinder the industry’s operations? Lower profitability? Would it hasten outright federal regulation?

I am no longer the sole blogger at National Underwriter, as I was joined last week by our longtime insurance technology editor, Ara C. Trembly. Ara is never at a loss for an opinion, always speaks his mind and never shies away from controversy–all critical traits for any successful blogger. Given the fact that insurance is one of the most resistent industries to change in general, and tech changes in particular, Ara should have plenty of fodder for debate. I urge you to check out his musings at www.insurancetechguru.com.

I got hit with an additional wave of e-mails and phone calls when I ran my Jan. 22 blog entry–”What If Hillary Was Right About Healthcare Reform?”–as my editorial column in our Feb. 5 magazine. The spirited responses I received from readers (some irate, others merely furious, although a few actually agreed with me) are posted with this entry. But I also want to call your attention to one very interesting phone call from an agent in Michigan who wondered how much better off the auto and workers’ comp insurance industries might be if a single-payer health plan took over the troubled medical components of both casualty lines. An intriguing possibility, don’t you think?

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We’ve referred to the insurance director of the Consumer Federation of America as “Insurance Industry Gadfly” J. Robert Hunter so often that I wouldn’t be surprised if he’d been tempted to check his birth certificate to see if his mama had burdened him with that moniker. But the truth is that Bob has given the industry a ton of grief over the years, including a recent report accusing property insurers of “overcharging” to reap “excessive” profits. Thus, you could hear the industry’s collective gasp when the news broke that the “legendary” Mr. Hunter had been tapped in Florida to help calculate property insurance rate reductions mandated by the recently passed reform law.

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It always ticked me off that Citigroup, after it acquired Travelers, had the audacity to swipe the insurer’s long-time logo–the red umbrella. Not only was that an example of blantantly stupid marketing (Why would anyone want to appropriate another company’s brand identity?), but it was arrogant and downright obnoxious as well. So it is with some satisfaction that I heard this week about how Citigroup would sell “its” umbrella logo back to Travelers, which–after being spun off in 2002–went on to merge with the St. Paul Companies a year later. The Travelers’ signature red umbrella is back where it belongs, and it’s about time! Perhaps there is some justice in this world after all.