1997 good bet for insurers
	Legally speaking: Claims must be handled consistently
	Insurers remain vulnerable to disasters
	Preparing for the millenium
	Right idea, wrong timing
	Short takes
	Tips for success from a top salesman
	Become a more productive manager
	Cell phone etiquette

1997 good bet for insurers

Fewer catastrophies, improved loss-cost trends, a strong stock market and relatively low environmental liabilities has made 1997 a banner year for insurers. A.M. Best Company predicted that the final results would show the past year as the best in 20 years for insurance underwriters.

While industry-wide premium growth remained in the 3%-4% range, the industry analyst predicted that growth in the overall surplus would pushed the industry to its best financial status since World War II. A robust stock market is primarily responsible for the healthy insurance portfolios.

While 1997 was exceptional for the property/casualty insurance industry, Best reported a major gap between strong and struggling companies. Furthermore, the Best report cautioned that some companies are aggressively reducing premium rates at their own peril because there’s no reason to believe that the industry will continue to enjoy an absence of major catastrophic claims.

Legally speaking: Claims must be handled consistently

A California appellate court decision could give policyholders more clout when they are suing insurers over coverage disputes. The decision in Pfizer vs. Orange County means that policyholders can investigate and take advantage of inconsistencies in the way insurers handle claims. Previously this type of pretrial investigation was limited to bad-faith cases.

If the decision is upheld by the California Supreme Court, it could have a nationwide impact since California is a leader in insurance litigation. Attorneys for the policyholders say the decision will encourage insurers to handle claims consistently. Insurers, on the other hand, maintain that such fishing expeditions will end up costing all policyholders and will open up the private records of the insureds to general scrutiny.

The decision means that if two different units of the same insurance company handle a claim differently, those differences could leave the insurer liable for damages.

The case started when Pfizer was sued by plaintiffs in New York because of alleged problems with the concave artificial heart valve it supplies to hospitals. Pfizer sued its insurers over a dispute in coverage, and successfully got access to insurance claims filed by other medical supply policyholders.

Insurers remain vulnerable to disasters

A leading reinsurance company has warned that reinsurance coverage for natural disasters in most major markets of the world is insufficient. A report from Swiss Reinsurance Company said that the relative amount of reinsurance purchases has dropped to a three-year low, presumably because of the relatively small number of major disasters such as 100-year storms or 500-year earthquakes.

The report concluded that reinsurance coverage is inadequate in heavily populated areas where disasters would create major economic losses. With major disasters, losses could threaten an insurer’s solvency if the underwriter did not have adequate resources to pay policyholders claims.

Preparing for the millenium

While the year 2000 poses a huge and expensive risk for many businesses, some companies are offering specific coverage for losses created by computer confusion. The policies cover losses "due to inability to correctly recognize, process, interpret or accept" a specific date or time.

The potential nightmare for businesses lies with computers programmed with only two digits to indicate the year. Unless the computers are reprogrammed, internal clocks will treat the year 2000 as the year 1900 – a misinterpretation that could wreck havoc in data and systems the computers manage.

The Insurance Services Office, Inc. (ISO) hopes by April to introduce a series of exclusions and endorsements to help underwriters address Year 2000 losses in standard property and liability insurance policies.

The ISO proposal has drawn fire from computer giant Microsoft, whose spokesman called the exclusion "a disservice to policyholders."

Right idea, wrong timing

Allendale Insurance Company decided in 1994 to do a study of 500 insured locations in California to provide data on ways to mitigate losses from earthquakes. The report analyzes such liabilities as unanchored heavy equipment, and sprinkler systems or gas lines that were not properly braced.

Unfortunately for Allendale, the study was a report only, and there was no follow-through. When the Northridge earthquake hit in 1994, the same liabilities that Allendale identified were major sources of damage.

According to Allendale spokesman Kenneth Devlin, 90% to 95% of earthquake vibration damage is preventable and a few thousand dollars in mitigation measures can save millions of dollars of damage that occurs after the fact.

The Rhode-Island based company is a hoping to apply the same mitigation techniques to properties in the New Madrid fault zone which, according to Devlin, is not getting nearly enough attention from insurers.

Short takes

What workers want most. A survey by Catalyst, a nonprofit business research organization, found that full-time workers in dual-career marriages want flexibility most. The survey found that 87% of the women and 82% of the men highly value the ability to come to work late or leave early on occasion to accommodate personal needs.

Raises and compensation in ’98. While the cost-of-living raise is becoming a thing of the past, most businesses are projecting pay increases of about four percent this year in order to maintain their competitiveness in the job market. According to the Washington Post, the highest raises will go to those in computer, telecommunication and accounting industries.

Eight hours every night. If you lose just one hour of sleep every night for a week, you might as well pull an all-nighter according to a Cornell University study on sleep. Dr. James Maas says sleep deprivation is cumulative and job performance suffers because of it. On the other hand, an additional hour of sleep each night can boost one’s alertness by 25 percent.

Why people buy. According to Target Marketing magazine, there are basically four reasons people use your product or service:

• You offer the best price;
• you offer the best service;
• you offer the best quality;
• you’re the only game in town.

Tips for success from a top salesman

Frank Pacetta knows how to turn failures into successes. The Xerox sales manager led his district from last to first place in his region in just one year. Here’s how he did it according to the Wall Street Journal:

• Prepare customer proposals on weekends or evenings leaving daytime free for sales.
• Never say no. Everything is negotiable with a customer.
• Pay personal attention to customers by sending thank-you notes, congratulatory cards on birthdays or promotions, or inviting customers to lunch.
• Go the extra mile with your customer, helping with billing problems or handling other company problems for which you are not directly responsible.
• Meet customer requirements even if you have to tackle your own company’s bureaucracy.
• Know your competitor’s product thoroughly.
• Be early for meetings.
• Dress and groom yourself sharply so you will look like a first class product.
• If you linger in the shower each morning because you don’t want to go to work, find another job.

Become a more productive manager

Being productive doesn’t just happen. It takes a plan. Try these five strategies published in the Denver Business Journal to increase your productivity and help you become a more effective manager:

Set goals every day. But don’t be unrealistic in what you want to accomplish. Plan some free time for those unexpected situations that will inevitably come up.

Match your schedule to your daily goals. If you goals include such things as finishing a report or working out for 30 minutes, organize your schedule accordingly.

Follow your plan. Many people make a to-do list and then let distractions derail them from accomplishing what they need to do. Use discipline to focus on your priorities.

Review your goals. This is a daily activitiy. At the end of each day, review how well you did in meeting your goals and assess why you did not finish some things you had hoped to.

Reward yourself. Set up a system to reward yourself for accomplishing your goals. Little rewards help motivate you to stick to your plan.

Cell phone etiquette

• Turn your ringer off. A phone ringing during a business meeting is annoying. Get a phone with a silent vibrator option.
• Don’t talk and drive. It’s just plain dangerous. If you absolutely have to use the phone while traveling, pull over and make the call.
• Keep conversations private. Others really don’t want to hear you conduct business in airports or restaurants. Fine a quiet corner to have your conversation so you won’t disturb people around you.
• Ask permission before taking a call. If you have to attend a meeting while you’re expecting an important call, let people know beforehand that you might be interrupted. If the call comes in, ask others if they mind your leaving the room.
• Use a regular phone for important calls. It’s difficult to negotiate important business when you have to contend with static and other distractions.