• Statistic Advisors Want To See

  Everyone likes to know what is going on. Are our actions getting worse or better? Do we do something more today than yesterday? Are we winning more or losing more? Only the Toronto Maple Leafs know the answers in advance so for the rest of us we must seek the statistics after the fact. AS an industry insurers use to keep track of how many cases were written, how many were issued standard, how many were placed, how many were not taken, how many were rated and how many were declined. As a junior risk taker in the business those numbers helped me judge how all risk selectors were doing and at times with a jaundiced eye looked tot he advisor as the cause of an increase in declines and “rated cases”. Always lacking at least from my perspective was an industry number on how many cases were disputed at time of claim. How many were denied? How many went to litigation? How many ended in compromise? How many were paid in relation to how many were totally submitted? I always wondered but never became an information champion seeking out those numbers other than a cursory “are they available anywhere question.

  After the demise of the great CLHIA package of statistics on placements, declines and rate cases some years ago I did complain but to ...

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• “The Reinsurer Made Me Do It”

   

  What a difference three decades makes in this industry that now sells investments with a side of life and living benefit insurance. Just focusing on one aspect like reinsurance, as I am want to do since 38.5 years of my 40 years in the business was wearing a reinsurance moniker, shows a humungous change. From the closet of obscurity or the fortress of solitude to the brunt of all risk selection criticism. From the quiet instigator of new products or supplier of surplus risk cover for the junior insurers to the ratchet vehicle for lower prices (read as lower mortality assumptions) and the glad recipient of risk when assets and investments were more fun for insurers, reinsurance has changed. No one has been as confused as the broker/agent who now lives with the echoing clarion call of “the reinsurer made me do it!”

  When the first signs of change occurred some 30 years ago with the reinsurers’ minor foray into everyday product design and acceptance of surplus risk, magazines like the Canadian Journal of Life Insurance and later Marketing Options rushed to find authors who could succinctly describe what reinsurance was and more importantly “who are those guys”. The major concerns of the early days of the eighties was “is it safe to place an insurance contract with a company who cedes the majority ...

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• Struggles With Risk Selection

  (Make them disappear)
  
  This Article was written in mid 2008 at the request of the editors of a magazine called Pravartak, the Journal of Insurance and Risk Management. A bit short as compared with many of my articles. Underwriting and its issues are so universal (be they the supply of top senior underwriters, the training of new underwriters, the communication between advisor and underwriter, the regulatory changes or the evolution of medicine) that articles, speeches and opinions are relevant in all insurance locales. The article was published in Volume III Issue 4, July-September 2008.

  Learning to love the underwriting process or, at the least, learning to survive that thing life and health insurers do called risk selection! Just how does the financial planner and/or life agent get comfortable with the categorization of clients into the super good, better than average, non-smoking leftovers, smokers and really impaired lives? How does the underwriter get comfortable with the sales concepts of distribution, the whining of agents who feel oppressed by the arbitrary nature of risk of selection or the inability of agent to gather all the information both financial and medical from the applicant the first time? Surprisingly you, if you are the agent and the source of all sales, are not alone as even the neophyte rookie unblessed underwriting candidate struggles these days with learning the “ropes” ...

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• The Other Underwriting (There are more than medical risks)

  An advisor I have a great deal of respect for, Lawrence Geller, asked me if I would write something about underwriting for the magazine produced by and for advisors. I think it will be published in June 2009. I was unsure what to write but tried to hit various points that were raised as current issues --- although many of the issues between advisor and underwriter fall into the “eternal” category. It was fun to write and I wrote it between games of the IIHF World Juniors 2009 in Ottawa.

   

  It is probably a stretch to say both advisor and underwriter understands the impact of illnesses or disease on longevity and mortality. Arguments rarely erupt between these two combatants, sorry partners, as all can recognize the individual with two heart attacks and poorly controlled diabetes and hypertension warrants an additional premium. There may be some debate on degree of extra mortality as the advisor argues that the applicant’s attending doctor says the individual is doing alright (but never alright compared to any normal baseline!); whereas, the underwriter knows the individual is highly substandard in comparison to the healthy insured population’s standard mortality pricing.

   

   This paper will not try to bridge the gap in the definitions of normal or standard medical assessments but rather try and lend some insight into how the underwriter thinks ...

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  Other risks

• HOLUA/IHOU Then, AHOU Now, and What Tomorrow?

  The following was written for OTR magazine as a response to Hank George’s article. I wrote it hoping the good old days when the OTR was full of point and counter point from which many of us learned that not everything is as it seemed. We learned from the verbiage thrown back and forth that was without edit and censorship. The freewheeling articles, letters, notes and short novels were the best part of OTR in some readers (underwriters) opinions. Alas, this attempt to respond to Hank’s article even though Hank himself thought it should be printed, fell to the axe of make changes, shorten it up, make it less personal, etc. Okay I get it. I will just put it out there on my web site.

   

  Every On The Risk crosses at least one of my desks and it barely has time to relax before I glance through it, tear out what I think is important to me and then I recycle the rest. As all that lovely glossy paper falls into the recycling bin I perpetually wonder why glossy paper as there is not a centre fold or an exotic car gracing the cover. I read what I think is both practical and relevant to the day to day operations of the underwriting department. I wonder who ever sees some of the esoteric ...

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  AHOU

• Financial Underwriting Why Bother?

  For the AHOU annual meeting in New York I was asked to be one of the back up speakers and thus to be ready to fill in when and where needed. This was a role I never played and I must say I would have preferred to give the speech since all the work was done. The following article is the nucleus of what I would have publicly stated although verbally I would have tried to be more provocative than in the written word.  I will also submit to the “On The Risk” magazine for publication but I must admit I am not optimistic it fits into their article expectations.

  When an underwriting historian looks at the subject of financial underwriting, they quickly come to the realization that the conflict/confusion/befuddlement in the different perspectives between underwriter and advisor has existed since days we could not agree on the value of the inventor of the wheel as key man! History being so out of vogue today I will skip the horse and buggy, the two great wars, the moon landing and the Cold War so I can jump to 1973. In 1973 wise men through the Society of Actuaries took a modern view of underwriting the large case. In that study, “Financial Underwriting For Individual Life Insurance” by Baskin and Marshall, transactions pages 509-571, the conclusions ...

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• Sember Ubi Sub Ubi

  Life is full of twists and turns, lessons and examples, memorable events, and the quickly forgotten. Recently, I came across an article in The Globe and Mail (much improved with the Wall Street Journal pages) that made me realize that what I have witnessed in some large companies was not unique to my eyes or sensibilities. It also made me realize I should step back and decide which group of leaders I wanted to be associated with if anyone would associate me with anything.

  I will not bore the reader with a repetition of the article. Suffice to summarize it as follows. From a leadership perspective, incompetent people can successfully and expediently ascend the corporate ladder by being exceedingly proficient at nurturing senior officers. Others with leadership skills fail miserably at nurturing senior officers. Said again, the latter group, too, can be classified as just as incompetent as the former.

  "Hello! Nothing new in the above diatribe," you say. "Has Ross succumbed to altitude sickness?"

  Okay, you're correct. There's nothing new there. However, it just points out that sometimes we have to be hit over the head with something before our minds can fully assimilate the reality before our eyes.  There were those in a previous life that tried to convince me that only I was out of step. My reluctance to join the political ...

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• Adapting to Army Boots

  I delighted my precious daughter a unique way when she was an infant and toddler. At six foot four inches, I would swing her through an arch, initiating well above my up-stretched arms down to safely above the floor. Emily would become a profusion of howls, giggles and smiles and always asked for more. Children grow, gain length and acquire accoutrements that befit a toddler. The accoutrement one day were shoes which were more akin to army issue boots.
  
  On that ill-fated day as I arced my Emily from near ceiling height to the intended near floor position, my life was about to change both temporarily and permanently. Emily curved her body inwards by bring up her legs. The ensuing collision of Emily’s army boots to my most vulnerable parts was akin to watching neutering back on the farm (my grandfather did it then with two bricks).
  
  I had a speaking role to play at an industry function and I had to adapt. Baggy pants, a stool to lean on and an MC who allowed me to remain upright and not moving made the day bearable and the audience none the wiser. Circumstance change and thus we adapt.
  
  Has our industry adapted? It is a question that would draw many to both sides in a debate. "Yes" is obvious since times have changed and thus ...

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• Big Knockers Never Ruled (But now they are doomed!)

  Growing up as a young healthy boy in Southern Ontario I had a passion for the finding the best knockers. They were not always easy to find and only the keen well trained eye could spot them either hanging around or lying right there at our feet. It was only as I matured into the late pre teens that I realized size was not the only criteria for winning the battle of the knockers or conkers as many a city folk called them. (Note: Conkers being derived colloquially from the word conk which means to hit on the head)
  
  Why are they doomed? It is not for the lack of chestnut trees but rather the ever spreading morass of rules and regulations meant to keep us and our children safe from harm or these weapons of mass destruction. On a recent trip to the UK my wife’s relatives broke the sad news to me. It was now against the rules and regulations of UK society in most areas to play with knockers or conkers (you pick the word that best describes your nuts). The UK law makers believe it is unwise and thus unsafe to play with conkers for in battle pieces of the chestnut may fly off and puncture the player’s eye. Since it would be impossible to enforce the other option, making ...

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• Eleven golden rules for financial underwriting

  Every insurance market in the world has witnessed periods when scrutiny of the financial integrity of application forms has been found wanting. Unlike medical underwriting, financial underwriting is not dependent on sound medical experience and reams of statistics. The fact that several companies in South Africa are expressing a concern about financial underwriting when there is increasing pressure to get applications converted to insurance contracts, is just one of the examples of the underwriting cycle for things like insurable interest, over-insurance and anti-selection by dubious consumers.
  
  Have there been early deaths that spur one to talk about financial underwriting at this juncture? No, not that we have heard about, but there is a mounting concern, because if one looks outside SA’s borders there is evidence of mortality skewed by early claims, where at death the wisdom of the underwriter’s financial judgement or lack thereof is called into question. Underwriters in SA need to ensure they are seen to be more proactive and in control of change.
  
  Poor financial underwriting has had many recurrences in the ultra- competitive North American market. The late 1960’s and early 1970’s saw a few early claims that made underwriters look rather foolish and gullible. Subsequent rounds of papers and articles emerged following poor results with what became known as ‘jumbo cases’ in the mid 1980’s and again in the ...

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For years, since Ross first edited and wrote for Life Office Management Association publications and then the historic Canadian Journal of Life Insurance, the unique style of opinionated and straight to the point writing has garnered continued exposure as a speaker in 39 countries.

The topics range through management, reinsurance, underwriting, technology and general insurance insight. His articles were most recently found in his section of the "Marketing Options" web site and previously the magazine under the banner "Off the Wall". He continues to write and deliver speeches.

Each of his contributions takes a unique view of the issue and his opinions come with insider industry anecdotes and humorous meanderings.