“Existential” is a word used far more often than it should be these days. Its importance has been diluted with its too easy and too frequent use as an adjective to assign far greater weight to events, people or things than are deserved. And yet, this is the adjective most often used when considering the COVID-19 pandemic and the response of governments in the U.S. to the many problems associated with it.

As stated by Joshua Raymond Muhumuza in his blog post, COVID-19 nudges us to rethink our approach to the existential threats of our time (April 28, 2020), Cornell University Alliance for Science:

“The world as we knew it ended a few months ago. What we have now is a seemingly alien muddle that we are all trying to make sense of. Aside from occasioning an unprecedented global public health crisis, COVID-19 is a not-so gentle nudge for humanity to rethink—and maybe reset— several things pertinent for our very existence.”

This is not an unreasonable characterization. The loss of life is tragic. The harm caused to families, whether directly through illness or loss of life, or due to the staggering effects on the American economy, deserves sympathy, compassion and remediation. The harm goes well beyond the physical effects of COVID-19.

But this commentary – repeated in one form or another in publications and broadcasts and across the Internet – is also lacking in context. This is not the first pandemic the world has ever faced. In fact, it is not even the first pandemic of this century, which began only 20 years ago. Under the microscope that exists today, the lack of preparation of both the public and private sectors is appalling, but also not unprecedented. In 2009, the California Nurses Association/National Nurses Organizing Committee (CNA/NNOC) and its 16,000 members were preparing for a one-day strike at 34 hospitals in California and Nevada in part due to lack of preparation, including access to adequate personal protective equipment (including N95 masks), for the H1N1 pandemic. The strike was averted. (See: here) 

Nurses figure prominently in the current pandemic crisis and the public policy debate regarding how the workers’ compensation system is to respond. This debate is the focus of legislative and regulatory action nationwide. In California, Assembly Bill 664 (Cooper), was amended on April 17 to define the term “injury,” for workers’ compensation purposes, to include being exposed to or contracting, on or after Jan. 1, 2020, a communicable disease, including COVID-19, for certain peace officers, firefighters and healthcare employees. The communicable disease must be the subject of a state or local declaration of a state of emergency issued on or after Jan. 1, 2020. The bill also creates a conclusive presumption that the injury arose out of and in the course of the employment and also exempts permanent disability resulting from such communicable diseases  from the apportionment provisions in Labor Code § 4663.

See also: COVID-19: Stark Choices Amid Structural Change  

Gov. Gavin Newsom declared a state of emergency due to COVID-19 on March 4. He subsequently issued a statewide stay-at-home order on March 19. London Breed, the mayor of San Francisco, declared the existence of a local emergency due to COVID-19 on Feb. 25. 

AB 664 also states, “It is the intent of the legislature in enacting this section to fully compensate the peace officers, firefighters and healthcare employees whose lives are placed at risk when they are exposed to or contract COVID-19 or other communicable diseases in the course of performing their duties.”

That last part, “…in the course of performing their duties,” would seem inconsistent with creating a conclusive presumption that would mean, in all cases, that being exposed to or contracting COVID-19 is a compensable injury regardless of whether the injury, as defined in the legislation, occurred arising out of and in the course of employment.

AB 664 is pending in the Senate Labor, Public Employment and Retirement Committee. No hearing has been set.

Also pending in this committee is Senate Bill 1159, written by Sen. Jerry Hill (D-San Mateo), chair of the Senate Labor, Public Employment and Retirement Committee, and Assemblymember Tom Daly (D-Anaheim), chair of the Assembly Insurance Committee. In the California legislature, the Insurance Committee has jurisdiction over workers’ compensation issues in the Assembly.  

SB 1159 is a work in progress. It seeks to create a “disputable” presumption of compensability for certain critical workers whose illness or death results from exposure to COVID-19 during a period in which the critical worker is in the service of an essential critical infrastructure employer. These and other terms will be made more specific during May. Unlike AB 664, SB 1159 has a sunset date, is specifically limited to injuries resulting from COVID-19 and is not retroactive.

The California debate, including whether Gov. Newsom will issue an executive order encompassing many of the issues framed in these two bills, focuses on five issues: (1) whether a presumption of compensability is conclusive, (2) which workers could claim the presumption, (3) whether the presumption is retroactive (and to when), (4) whether the presumption is limited to COVID-19 exposure and illness and (5) whether exposure alone, without contracting COVID-19, is a compensable injury.

How these issues are resolved will, dare I say, have an existential impact on the workers’ compensation system. A conclusive presumption inevitably means that workers’ compensation will provide healthcare and wage replacement benefits for illnesses not arising from an occupational injury. For the public and private sector classifications most often named to benefit from such a presumption, these benefits would be in place of benefits paid through ERISA plans, various state-mandated leave programs and other employee programs such as sick leave or personal or administrative time off. 

By allowing these changes retrospectively, California would also allow healthcare plans to recoup money paid out in benefits, and prospectively to deny any coverage for COVID-19 from an employee. In essence, workers’ compensation becomes the primary healthcare insurance for any worker subject to the conclusive presumption. It would also allow California’s Employment Development Department (EDD) to recoup money paid under that state’s disability insurance program (SDI) to disabled workers who contracted COVID-19 from community or travel sources. 

The proper role for workers’ compensation in this crisis is to ensure it does what it is intended to do and has done for over a century. Now is not the time to try to lessen the burden on other benefit systems by creating a legal fiction that all exposure to COVID-19 occurs at work for certain employees – even in those occupations that have a high risk for occupational exposure. 

See also: Impact of COVID-19 on Workers’ Comp  

With this observation, however, comes a solemn obligation. This potential existential  risk is more likely to become a reality each time an employer or an employer’s insurer or claims administrator denies a claim without proper investigation or justification. The national debate over presumptions over the past several years strongly suggests that not all actions taken by employers on claims are consistent with the underlying grand bargain of workers’ compensation.

As observed by the Colorado legislature when addressing the question of rebuttable cancer presumptions in 2017, “Nine years of experience has shown that the rebuttable presumption established by House Bill 07-1008 has produced no demonstrable benefit to firefighters but has led to significantly greater costs to employers of firefighters.”

During this critical time in our nation, it's important for policymakers to understand that the various programs that make up America’s social welfare system should be providing for those who are ill with the benefits both law and contract oblige these programs to provide. The focus should be on the unacceptable gaps in this system and how to close them, not how to shift responsibility from one program to another with all the unintended problems that will cause. 

The COVID-19 pandemic has put an enormous strain on the healthcare system, delaying non-emergency medical care, potentially creating a higher risk for pain patients. However, the behavioral health community is adjusting with transitions to telemedicine and other alternatives that allow their patients to receive the care they need. With clinicians feeling additional stress during this time, telehealth options are readily available for the healthcare community, too. We cannot expect those working in healthcare to properly care for others unless we are prioritizing their mental health needs.

Two of the leading researchers and practitioners in pain medicine joined us for our special edition Out Front Ideas COVID-19 Briefing Webinar Series to discuss the challenges of treating pain patients during the pandemic and how the healthcare landscape is adapting:

• Beth Darnall, PhD – pain psychologist and associate professor, Department of Anesthesiology, Perioperative and Pain Management at Stanford Health Care
• Steven P. Stanos, DO – medical director of pain medicine and medical director of occupational medicine services at Seattle’s Swedish Health

Workplace Wellbeing

Due to the additional stress that the pandemic has created for healthcare workers, behavioral health psychology and counseling have become available in many primary care facilities. The behavioral health industry has a concierge of services that allow doctors to work with a therapist confidentially in a time of need. This “care for caregivers” model also includes Zoom-based videos and lectures covering helpful techniques like tai chi demonstrations, breathing exercises, guided meditations and chair yoga. These videos are then saved in an archive, making them readily available for later use when caregivers need them. While created to get through the stress of the pandemic, these videos will help to alleviate tension that healthcare workers face regularly.

Behavioral health, as well as many other clinical disciplines, had to rapidly adjust to telehealth visits, creating safer access for patients. Not only does this alleviate stress for the clinicians, it creates a safer workspace for clinicians and staff alike. In addition to the creation of video resources for the healthcare community, crisis management and wellness resources are available. Organizations like the American Psychological Association have created online resources that collate information for clinicians and administrative leaders, providing on-demand access when they need it most.

Patient Wellbeing

COVID-19 has created disruptions in all areas of our lives, but it has been especially challenging for those managing chronic pain. These patients are seeking stabilization in their lives, but continued disruptions have complicated their paths to wellness. These disruptions can compound mental and physical ailments for a pain patient, making it especially difficult for those with co-morbidities. The pandemic has exposed the vulnerability of opioid patients given the difficulty it has created for those who need access to medications. Some patients have requested options to taper off opioids or reduce their usage since the current environment may leave them feeling even less in control. 

Because patients are at the mercy of the elements currently, it is increasingly critical to use patient-centered communication. Many pain patients who were just beginning to develop regular schedules are now dealing with the stress from a lack of routine. Refreshing patients on skills learned through previous treatments may help create structure and give clinicians key insights into their at-home routines. Understanding a patient’s stress level can make medication refills easier because conditions like anxiety may be exacerbated currently, putting an opioid patient more at risk than usual. This continued communication will be key when there is a return to normalcy, to maintain consistency in the care of an injured worker.

Treating Pain During COVID-19

Accessibility is essential in treating pain patients throughout the pandemic. Nearly all visits have become telehealth visits, including psychological follow-ups and physical therapy. Behavioral medicine now offers options like individual or group sessions and on-demand treatments that can be used without a therapist. Immersive, experimental treatments, like virtual reality (VR), have created more engaging therapy for patients, putting control in their hands so they can get help when they need it. This portfolio of options, including internet-based treatments, creates readily accessible care for pain patients.

Patients who were involved in rehabilitative programs can now experience treatment virtually. The same content they would receive in-office, through physical therapy, pain education and relaxation training, can be delivered through courses a few days a week. A couple of options for these treatments include Zoom group visits or private YouTube videos, which comply with the Health Insurance Portability and Accountability Act (HIPAA). 

All of these virtual programs work to support the hospitals when they need it most. For those experiencing significant pain and those with co-morbidities, emergency procedure clinics are now open to avoid ER visits and waiting on an approval process through a hospital. These clinics help to reserve hospital capacity for patients who need it most during the pandemic. 

Current Research

The need for alternative treatments during the pandemic has created a wave of new research and guidelines for therapy. The National Institutes of Health (NIH) introduced the “Heal Initiative” to reduce opioid usage and awards grants for tools creating alternative pain management. One of those viable options includes VR, which has shown to be equivalent and sometimes even more effective than in-person pain therapy. These concepts retrain a patient’s brain and can optimize experiences based on biofeedback. This type of experimental treatment is especially helpful in areas where there are not enough trained clinicians to deal with those experiencing acute and chronic pain. As this technology gets increasingly cheaper, it will create better long-term tools for patients in need.

New guidelines created by the American Academy of Pain Medicine (AAPM) and the American Society of Regional Anesthesia (ASRA), in conjunction with Veterans Affairs (VA) and the Department of Defense, outline best practices for pain management during the pandemic. This document also addresses public health issues and the welfare of providers. It covers the potential issues surrounding telemedicine, explains how to treat opioid management, outlines mental health considerations for patients and healthcare providers and defines emergency procedures, like those associated with cancer patients. The document discusses emergency procedures for patients with poorly controlled pain that need opioids and how to help those experiencing withdrawals from use. The document also advises the use of acetaminophen to treat pain because the topic is still controversial in its interactions with the treatment of COVID-19. 

See also: Impact of COVID-19 on Workers’ Comp

While this period is transcending longstanding barriers now that on-demand care has been proven necessary, it is also important to continue assessing pain from a multidimensional perspective. This includes evaluating the risk for each patient, so in-person psychological evaluations are being used to treat the more symptomatic patients. Using resources like patient records and history to discern patients' pain can provide insight into which patients may be more at risk. Though it may seem that telehealth visits could increase the risk of opioid abuse, there is no evidence on the extent of that risk when it is still the same patient reporting the same pain value, in-office or not. It is critical to take a patient’s reporting at face value and remember that pain will always be subjective.

To listen to the full Out Front Ideas with Kimberly and Mark webinar on this topic, click here. Stay tuned for more from the Out Front Ideas COVID-19 Briefing Webinar Series, every Tuesday in April. View the full list of coming topics here.

When I founded and edited what became known as a "new economy" magazine in 1997, to explore all the strategic possibilities created by the internet, a friend told me a curious thing.

"You know," he said, "there were magazines with names like Popular Electricity back in the early 1900s, when it was this great new thing. Then electricity just became part of daily life, and the magazines went away."

Sure enough, after half a dozen fine years, my magazine, Context, faded away, as did all the similar publications, including Business 2.0 and the Industry Standard, which once were so thick with ads that they looked like phone books.

It may now be time to start retiring the term "insurtech," too.

It's not that technology is no longer a key driver for the insurance industry. Far from it. In fact, the pace of innovation has been picking up for years as companies have become more knowledgeable about the possibilities of various technologies, about how to incorporate them and about how to innovate, in general. Now, COVID-19 is making the industry step on the accelerator because so many interactions must happen virtually.

The issue is that technology is now so ubiquitous that it's time to stop treating it as this new, alien thing. Yes, the many technologies now at the industry's disposal — blockchain, the various flavors of artificial intelligence, etc. — are wildly complex. But so is the laptop or phone you're using to read this right now, yet you treat your device as a tool, a simple extension of your hand or your brain. It's time to start thinking of insurance technology — not insurtech — the same way.

We're solving business problems, not technology problems, as we innovate within our organizations. We want to have the most efficient operations, the smartest underwriting, the fastest and smoothest claims processes for clients. Technology will play a role almost everywhere, often a key role, but the goal isn't simply to have the best AI or the coolest blockchain application.

The industry has been migrating toward a more balanced view of technology and innovation. You see that, for instance, as companies try to rethink the customer journey, where the focus is squarely on the customer and where technology facilitates much of what happens, but in the background.

Some technologies will still require great attention, in and of themselves. Something like blockchain, for instance, could provide a competitive advantage if you figure it out before your competitors, or it could be an expensive bust for you, so you need to develop a deep understanding of the technology. But even with something like blockchain, you're starting with that business problem you're trying to solve.

I suspect the term "insurtech" will play out rather as "digital strategy" did at the consulting firm that published my magazine.

When the late, great Mel Bergstein founded Diamond Management & Technology Consultants in 1994, he had the then-radical idea that digital technology could drive corporate strategy, rather than just be an afterthought. The firm did a lot to popularize that concept, especially when one of our partners, Chunka Mui, co-wrote a best-seller in 1998, "Unleashing the Killer App," whose subtitle was "Digital Strategies for Market Dominance."

The notion of digital strategy stayed popular through 2010 or so, I'd say, and plenty of consulting firms will still sell you one, but every strategy has a digital piece to it these days. Try to imagine a strategy that isn't digital. So, "digital strategy" has gradually become "strategy."

Likewise, while a few people still talk about "e-commerce," it mostly has a simpler name: "commerce." Amazon was treated as a technology company for the longest time even though it sold books. Now, it's treated as what it is: a retailer (that's extraordinarily sophisticated in its use of technology) and a provider of technology services through its AWS cloud business.

"Insurtech" hasn't been around nearly as long as "digital strategy" or "e-commerce," and the combination of insurance and technology in innovative ways will only pick up speed from here. But the innovation needs to happen as part of, well, the normal innovation process and not as a sort of excursion into foreign territory. So, I think "insurtech" will soon enough be referred to by a different name: "insurance."

It’s not clear what “normal” will look like when the throes of the COVID-19 pandemic are behind us. The world will probably not return to the way things were in February. But the world is learning to cope; so are insurance carriers. Recently, Novarica’s team facilitated a virtual town hall to learn how insurer CIOs and their teams are adjusting to working from home (WFH) as an entire organization. 

Most insurers appear to be navigating the same challenges and enjoying the same benefits from the transition. Despite varying reaction times of state governments in issuing shelter-in-place orders and encouraging non-essential workers to stay home, most insurers appear to have taken aggressive action to protect their employees and ensure continuous service for their customers by mid-March at the latest.

While some individuals and teams within insurance companies already had experience with WFH, insurance IT leaders noted apprehension about large-scale efforts to do so. A month later, here are some of the key considerations—and lessons—insurance IT executives have learned from the rapid-fire process brought on by COVID-19. 

This Isn’t a Snow Day

While most companies, including insurers, have been prepared for small-scale WFH events in the case of weather events like heavy snow or a hurricane, CIOs were bracing themselves for the strain that more widespread WFH would put on certain areas of their organization. VPN access and general internet bandwidth were a main concern for insurers across the board, but with additional licensing, close collaboration with key suppliers and careful management, carriers are staying online.

Paper processes are another area of focus for many insurers; some are partnering with lockbox vendors to close manual gaps by handling scanning and e-payment. Most insurers noted that they are sending limited numbers of key employees to the office to manage any processes that can’t be immediately made digital. At least one insurer at the town hall noted that the company shut down specific lines of business that would guarantee a floor on return for the time being, but all participants said they aren’t seeing a dynamic outflow of cash. 

One long-term adjustment an insurer noted was that employees were encouraged to take their entire office setup home to optimize their workspaces for the duration of this pandemic. This included signing out desks, chair and computers—anything that would help employees keep their productivity levels up while remaining safely at home. 

See also: COVID-19: Stark Choices Amid Structural Change  

Communication and Transparency Are Key

Insurers’ biggest concern right now is consistent across the board: people. This includes their employees, their agent/broker/vendor partners and their customers. No matter the action being taken, all insurer IT executives said their top concern was keeping everyone safe while they’re doing their jobs. The best way of ensuring this gets done is by communicating openly and often. Most organizations are holding company-wide town halls on a regular basis, offering virtual facetime with senior leadership as well as with their direct managers. 

When possible, video chat is being encouraged to keep everyone in touch and engaged. Team leaders and executives have sent out thank-you notes to the teams staying productive during a global crisis, and some CEOs are answering employee questions during their town halls to make sure every voice is heard. Engagement methods like voting on the questions to be asked during meetings, themed virtual happy hours, informal daily team huddles and mindfulness resources posted on company intranets have all seen positive results at insurers. 

While video conferencing has been an adjustment for some organizations, most participants in the town hall said it has been a valuable tool for helping teams stay close even though they have to be apart. In addition, most 2020 metrics for managers have been altered or paused to allow them to prioritize caring for their teams. As one CIO said, while business continuity plans have been a good guide for this situation, everyone is learning along the way. 

The Future Holds More WFH Flexibility

With insurers, vendors and agents all successfully shifting more than 95% of their operations online, the future of work might look vastly different from how things operated at the beginning of March. Many insurer IT executives are finding that digital projects that were on the road map are suddenly a priority. Digital applications and processes are all on the rise, and some vendor partners are even offering upsell opportunities at a discount that could help boost digital functionality. 

But will remote work become a permanent fixture for most American workers? It might for some of them; remote talent pools allow for a broader range of applicants to fill empty roles, and some employees feel more productive within their own walls. Most insurer CIOs think the answer lies somewhere in the middle. 

While it’s becoming clear that most roles can be completed from home, many employees find themselves missing their in-office neighbors and water cooler chats. Every office has its own culture, and some insurers may hire more remote workers and allow more flexibility with WFH options. Others might shift back more toward traditional ways of working.

The insurance industry, like much of the world, had to shift rapidly to WFH practices. While the transition wasn’t entirely seamless, insurer IT executives have found broad success by focusing on the people and processes that keep their organizations going. These short-term changes are likely to lead to permanent alterations once we have reached our new New Normal, whatever that looks like.

“When one thing is different, it is change; when everything is different, it is chaos!”

Yesterday, Corona was a beer. Today, Corona is still a beer but is also a disease, a pandemic. It is the reason I’m at home typing this article, and you’re at home reading it. If the Civil War was the defining event in our county in the 1800s, and the world wars, Korea and Vietnam were the defining global events of the 1900s, then corona – the virus, not the beer –will be the defining event of 2000-2020. If you consider worst-case scenarios, this coronavirus crisis may just be it.

I question whether the worst of these worst cases is not the disease but our reaction to the real and imagined threats. Time will tell. 

For perspective, consider the following:

It was October 1962. I was a sophomore in high school. Coach Blanco was our teacher. He was sitting on his desk facing south. Tension was in the air because the U. S. Navy was going to confront the Soviet Union that day over its deployment of ballistic missiles in Cuba. In the previous weeks, we had prepared for such a contingency by practicing nuclear bomb drills – literally getting under our desks and covering our heads with our arms and hands. 

Coach said, “Boys, if you see me get off this desk and crawl under it, you do the same because that means I’ve seen a mushroom cloud.” Nervous laughter followed. Thank God we never needed to act on his instructions.  

Since that time, the U.S. has fumbled through the Vietnam conflict (which in retrospect should never have been fought) and avoided nuclear war. We finally declared victory in Vietnam and withdrew. Decades later, the Soviet Union collapsed, and the Berlin Wall came down. We have been blessed. 

See also: 10 Moments of Truth From COVID-19  

Shortly after the Cuban Missile Crisis and the assassination of John Kennedy (Nov. 22, 1963), Lyndon Baines Johnson became president. The Great Society followed, with a set of programs that aimed for the total elimination of poverty and racial injustice. Some progress was made, but real challenges remain.

Today, our country and the world are threatened by the coronavirus and the nearly complete shutdown of our malls, schools, Main streets, manufacturing, commerce and social lives. The U.S. has gone from a booming economy to an economy that has gone down in a boom.  

I could go on, but I won’t. I’ll offer the following six questions for your consideration. Consider these strategic planning issues to be pondered as you plan your future, next week, next month and next year(s). Obviously, this is not an all-inclusive list.

1. Tomorrow - who will be your clients and prospects?  
2. What will be their wants and needs that you are positioned to address?
3. Since the virus crisis eliminated “place” as part of the value provided by your office, will you compete as well in a virtual market as you did on your Main Street?
4. As technology and the growing Gen X, Gen Y and future generations become more enamored with each other, does human touch (like a good neighbor or your local agency) lose value?
5. As technology allows us to provide service that is fast, hot and cheap, will clients tolerate current commission levels, will coverages be quoted net of commissions or will commissions become negotiable? 
6. What is your greatest nightmare about the agency business? Is it closer to or further from your horizon than it was on last New Year’s Eve?

After the assassination of JFK, the journalist Mary McGrory said, "We'll never laugh again," and Kennedy aide Daniel Patrick Moynihan famously replied, "Mary, we will laugh again. It's just that we will never be young again."

If I might be so presumptuous: After our coronavirus experience, we will laugh again, and the young will still be young, but we will never feel invincible again.  

See also: Rethinking Risk Management in a COVID-19 World  

My friend Mark attributes his success to “waking up scared to death every morning!” Do you? Should you? Or will you remain in your comfort zone of yesterday, dumb, fat and happy?  

Place your bets on tomorrow!

In 2008-09, during the height of the Great Recession – a time when the U.S. economy was in a meltdown and every auto manufacturer was seeing sales plummet – Hyundai Motors increased its market share by a remarkable 40%.

Understanding how Hyundai did it offers a valuable lesson to any company that’s trying to navigate a period of consumer crisis. Here’s how the story goes:

In October 2008, Wall Street and the banking sector began to implode, car sales fell precipitously and Hyundai sought an answer to a question that was vexing most auto industry executives during that dark time: Why weren’t people buying cars? Why weren’t they coming into showrooms? Why weren’t traditional car buying incentives (rebates and financing deals) – which were always effective in past economic slumps – driving foot traffic into the dealers?

To answer these questions, Hyundai executives did something extraordinary. They talked to their customers. Through those conversations, Hyundai was able to put its finger on exactly what was going on in consumers’ heads.

What Hyundai executives came to realize is that – even in the depths of a financial crisis – plenty of consumers were still interested in buying cars, and plenty of consumers still had the money to buy cars. But people were staying away from the dealer showrooms because they were afraid.

They were afraid that they’d buy the car, get laid off shortly thereafter and be saddled with car payments they couldn’t afford. (Remember, at this time in the U.S., the economy was shedding hundreds of thousands of jobs each month.)

With the benefit of hindsight, the fear might sound like common sense. Back then, however, the realization was an “Aha!” moment for executives, and it triggered an entirely new line of thinking at Hyundai around how to arrest, if not reverse, the sales decline.

The company shifted its focus from sales incentives to fear mitigation and tried to figure out how to eliminate (or at least alleviate) the emotionally charged worries that were keeping consumers away.

The answer lay in an entirely new offering that Hyundai rolled out in January 2009 and dubbed the “Job Loss Protection Program.” It was a guarantee whereby the automaker basically said to consumers: If you buy a car from us, and within one year you are laid off (for any reason at all), just bring the vehicle back and – no questions asked – we’ll forgive all remaining payments on the car.

This single tweak to their customer experience was a game changer. With the fear of job loss impacts removed from the purchase decision, consumers flocked to Hyundai dealers, boosting sales by double-digits, increasing market share by 40% and elevating the brand’s prominence in the marketplace to levels never before seen.

Hyundai weathered the Great Recession better than many other automakers. The approach the company used to accomplish that feat has clear relevance now, as both B2C and B2B companies navigate an even bigger consumer crisis triggered by the COVID-19 pandemic. To emulate Hyundai’s approach — so that you better engage your target market, as well as strengthen loyalty with existing customers — follow this three-part formula:

1. Look at the world from the customer’s perspective.

This is, of course, the golden rule of customer experience design.  ts importance, however, is accentuated during challenging times, when customers are thinking and feeling in a way that’s very different from normal. Understanding those dynamics is critical to adjust your customer experience so it resonates even more strongly with your target clientele.

Doing this effectively requires truly immersing yourself in the customer’s perspective, which is not something that can be achieved solely through dry research surveys and satisfaction studies. In times of crisis, teasing out what’s on your customer’s mind requires getting close to them (physically or virtually), stepping into their shoes and seeing the world through their eyes.

Hyundai accomplished this by having in-depth conversations with sales prospects and customers. Other avenues for immersing yourself in the customer perspective include consulting with front-line employees (as they can tell you what they’re hearing from customers), as well as actually observing customers as they interact with your business (to spot existing pain points or new ways to better serve them). All of these insight-gathering techniques help reveal those not-yet-obvious consumer needs that fuel customer experience innovation.

See also: The Messaging Battle on COVID-19: Are Insurers Losing?  

2. Pay attention to emotional needs, not just rational ones.

In the two-year life of the Hyundai Job Loss Protection Program, only 350 cars were returned to the company – a minuscule percentage of overall sales, and a statistic that belies the impact the program had on the automaker’s brand recognition and business success.

The fact that so few cars were returned under the program, despite its tremendous popularity, suggests that consumers’ perceived risk of job loss (and the resulting impact on one’s ability to make car payments) was much greater than the actual risk of that outcome. What that really means is that the true value of the Protection Program was in its ability to satisfy consumers’ emotional needs, as opposed to rational ones.

That doesn’t make it any less of a beautiful solution to what consumers clearly viewed as a real problem. Indeed, the program underscores the importance of not just thinking in terms of rational, logical requirements that customers might have during times of crisis. It’s equally important to satisfy their emotional requirements, which in the case of Hyundai amounted to the mitigation of fear. For other businesses (or other types of crises), those emotional considerations might be addressed, for example, by giving customers peace of mind, by making them feel like they’re part of a community or by instilling in them a sense of pride or confidence.

Whatever the tactics, the key point is that in a crisis (as we’re experiencing with the COVID-19 pandemic), people are in a vulnerable, emotionally charged state. While creating emotionally resonant customer experiences is important at any time, it’s even more vital during difficult times, and presents a unique opportunity to create an indelible, positive impression on the people you serve.

3. Advocate for your customer in tangible ways.

Being an advocate for your customer means putting their interests ahead of yours. Importantly, it’s not about good annual report copy, website content or an advertising campaign that touts “putting your customers first.” It’s about showing customers that this company’s got your back, that we’re in your corner. It’s rare that people see companies do this, so, when it does happen, it creates a memorable peak in the customer experience that helps cultivate loyalty.

The impact of customer advocacy, however, is amplified during crises because of the vulnerable position in which many of your customers will find themselves. When you’re in a stressful situation, when you’re in a pit of despair due to tough circumstances, if someone extends a hand to help you get out of that quandary, it’s an engaging gesture for which you’ll be eternally grateful. That’s the power of advocacy in forging new customer relationships, as well as cementing existing ones.

The Hyundai Job Loss Protection Program transferred risk from the customer to the company. It was a tangible demonstration of advocacy by the automaker – a gesture of support and goodwill, even if it was grounded in a very business-focused desire to get consumers back into the showrooms. (No apologies for that are necessary, because the fact is, over the long-term, customer advocacy is simply good for business.)

In the current COVID-19 pandemic, you can spot those organizations that are employing Hyundai-like tactics. Instead of responding to the crisis by invoking platitudes in one of those “we’re here for you” broadcast e-mails, the smart organizations are being thoughtful. They’re thinking carefully about what people are going through, and they are making tangible changes to their customer experience as a result. Examples include:

• Australian supermarket giant Woolworth’s, which in mid-March was among the first retail stores to establish dedicated shopping times for elderly and disabled customers. Their move was in response to panic buying by the general public, which left vulnerable populations struggling to get their basic necessities. Woolworth’s made it easier for them to do so.
• American Family and Allstate insurance, which, within hours of one another, were the first U.S. auto insurers to announce they’d be refunding a portion of their policyholders’ insurance premiums. Both insurers noted that people were driving far less (due to stay-at-home orders), and this was a way to help ease some of the financial strain that their customers were experiencing.
• Scholastic, which recognized the difficult task that teachers, parents and children faced as they moved to remote schooling. In response, the company curated an online library of virtual lesson plans to help instructors and caregivers minimize the disruption to kids’ education.
• U-Haul, which saw an opportunity to help scores of college students who, on short notice, were instructed to vacate their dormitories as schools shut down to prevent the spread of COVID-19. The moving and storage company offered any college student in the U.S. and Canada 30 days of free storage while they figured out what to do with their belongings.

These are all examples of companies that carefully considered how the landscape in which they operated had changed, and how the lives of people in their communities had been altered. Were these firms being purely altruistic? Perhaps not, but that doesn’t diminish the significance of their actions.

These companies are, after all, for-profit entities. It’s okay if they aspire to earn a better brand reputation. It’s okay if they hope to attract some new customers via their actions. The point is, they’re doing it in a noble way, a way that genuinely aids people in the short term, even while potentially helping the company in the long term.

Their actions were guided not by what was legally required, not by what a regulator mandated and not even by what many of their customers (or non-customers) may have reasonably expected. Their actions were guided by what was fair, what was right and what served the best interests of consumers.

See also: COVID-19: Stark Choices Amid Structural Change

Critics might note that some of these firms’ customer experience enhancements were quickly copied by competitors. That’s true, but there is a first-mover advantage here. Those businesses that drive experience innovations (rather than follow them) tend to be viewed by consumers in a more positive light. (Hyundai’s 2009 Job Loss Protection Program was copied by other automakers within a few months, but none achieved the notoriety that Hyundai did.)

Furthermore, while a single, specific experience enhancement may be easy to copy, what’s much harder to replicate is the outside-in mode of thinking that customer experience leading firms possess. That’s where they derive long-term strategic advantage, because they’re the ones that are perpetually devising new and improved customer experiences that become a hallmark of their brand.

With every crisis comes opportunity. Not an opportunity to exploit a bad situation for business gain, but, rather, an opportunity to enrich the lives of those you serve by genuinely and selflessly helping them during a time of need. In a crisis, that’s how you cultivate customer loyalty, that’s how you generate positive word-of-mouth and that’s how you come out stronger on the other side.

The article was previously published here.

During this pandemic, many workers (nurses, police, grocery store clerks, transit professionals, etc.) are considered essential, potentially putting them at heightened risk for contracting COVID-19. A key question, of course, is whether a worker who contracts COVID-19 is compensated under workers’ compensation for income loss and medical expenses. 

Below are some frequently asked questions that get posed to me as president and CEO of the Workers Compensation Research Institute (WCRI). We’re an independent, not-for-profit research organization that provides high-quality, objective research and statistical information about public policy issues involving the various state workers' compensation insurance systems in the U.S. 

Q1: Is COVID-19 covered under workers' compensation and, if not, why not?

A1: Historically, communicable diseases, like the flu, have generally not been covered.  Workers’ compensation covers injuries and illnesses that arise out of and in the course of employment. It is generally difficult to establish work-relationship for a disease that could be contracted anywhere. Indeed, some states’ statutes bar compensation for communicable diseases. In the past few weeks, though, a number of states have taken steps to expand workers’ compensation coverage to include COVID-19 for certain groups of workers.

Q2: What is the course of action for states seeking to cover essential workers affected by COVID-19?

A2: Some states consider that their current laws, regulations and procedures are sufficient to provide compensation for workers who demonstrate that they contracted COVID-19 at work. Other states have changed their rules, either by executive order or legislation, to increase the likelihood that a worker who contracts COVID-19 may be eligible for workers’ compensation. The states vary in terms of the scope of workers covered and in terms of the burden of proof required by an ill worker to establish work-relatedness. A number of states’ laws and orders cover only first responders or healthcare workers. Others expand coverage to include other groups of workers deemed to be essential, e.g., grocery workers. In some states, the worker may be eligible for workers’ compensation if the worker can demonstrate that the illness was the result of his employment or occupation. In other states, for the workers covered, there is a presumption that their illness arose from work, though that presumption can be rebutted.

Q3: Is this the first time coverage has been expanded for conditions that may arise outside of work?

A3: No. For example, we have seen workers’ compensation coverage expanded to include those, particularly first responders, who witness a traumatic experience and as a result have post-traumatic stress disorder (PTSD) and can no longer perform their duties. 

Q4: Is workers' compensation administered at the state or federal level?

A4: Individuals injured on the job while employed by private companies or state and local government agencies are covered by workers’ compensation programs administered by the states. The essential features of the states’ workers’ compensation systems are similar, but they may vary in terms of the compensability of some conditions, the amount of benefits paid and other features. Federal and some other workers are covered by four disability compensation programs administered by the U.S. Department of Labor.

See also: Impact of COVID-19 on Workers’ Comp  

Q5: What does workers' compensation cover, and are the benefits across the country the same?

A5: Workers’ compensation covers all medical benefits and wages lost while off work due to the injury. It covers the first dollar of medical care, and there are statutory formulas for the income benefits that replace lost wages. WCRI’s workers’ compensation laws reports are a great resource to identify the similarities and differences across workers’ compensation systems in U.S. states and Canadian provinces.

Q6: Is WCRI working on any research that will help us better understand the impact of COVID-19 on state workers’ compensation systems?
A6: WCRI has a wealth of studies that provide a pre-COVID baseline for evaluating the impact of the virus on workers’ compensation claims. This includes WCRI’s CompScope Benchmarks studies, which compare a range of workers’ compensation performance metrics across 18 states. In the future, we will evaluate the impact of the virus on the composition of claims and their costs, how the virus may have affected the delivery of care to workers and the impact of that on worker and claims outcomes, including duration of disability.

To learn more about WCRI, visit www.wcrinet.org.

Sadly, the insurance-focused news outlets are starting to overflow with references to who is suing whom over certain types of coverage related to the COVID-19 pandemic. There is a growing regulatory and legislative outcry for the insurance industry to pay out in instances where there is no specified coverage or where coverage is actually excluded. Both business and personal lines customers do not fully understand where they are (and are not) covered. It is a pretty dismal picture, and it is going to take a long time to sort all this out. In the meantime, a growing trend provides a glimmer of hope in all this chaos – parametric insurance.

Parametric insurance covers a specific event that can trigger a claim payment based on metrics from a recognized source such as the Richter scale for earthquakes or the number of hours a plane is delayed. While parametric insurance isn’t new – it has been available in emerging nations over the years – usage has been limited and sporadic. During 2019, there were undoubtedly some launches of more mainstream products such as Swiss Re’s Quake Assist product and Sompo’s flood product. However, this month, there have been at least four notable launches or expansions:

• AXA Climate – AXA partnered with Dutch satellite technology firm VanderSat to derive triggers linked to soil moisture levels, enabling drought-related parametric insurance. The same soil reading technology can determine excess moisture, as well, triggering payment in either direction.
• Global Parametrics/Arbol – Global Parametrics, a parametric and index-based disaster risk transfer company, teamed up with Arbol, a technology-driven marketplace that uses blockchain and smart contracts to provide weather risk insurance coverage to smallholder coffee farmers in Costa Rica.
• Parsyl – Parsyl Insurance launched a suite of connected cargo insurance solutions for perishable goods, called ColdCover. Parsyl’s quality-monitoring and risk management platform leverages smart sensors and data analytics to manage the supply chain as well as loss control. The featured product within the company’s new suite is called ColdCover Parametric, which includes customized quality triggers and payout levels.
• Understory – Understory initially launched its Hail Safe product for auto dealerships this past November but rolled it out to a significant number of additional states in April. The product coverage is triggered through the use of Understory’s proprietary hail sensor. Understory partnered with international weather risk manager MSI GuaranteedWeather to bring the product to market.

These examples are stated simply for brevity. But the scenarios are not that simple. For example, the Global Parametrics and Arbol example also includes an ecosystem of related parties in the transaction. And Parsyl provides services and an extensive risk management system so that cargo and fleet owners can manage exposures. From an education perspective, it is worth getting further details on all four scenarios. However, for purposes of this blog, the particularly hopeful note is that all this has happened in one month – the cycle of innovation and response is speeding up.

See also: Keeping Businesses Going in a Crisis  

Insurers and technology providers are coming together to find opportunities to create products that have specificity in terms of coverage and payment amounts. This is a very good thing! Insurers need to continue to seek opportunities to innovate in this area. Clearly, not all product lines are appropriate for parametric policies. However, in more instances than not, bringing sensors, aerial imagery, weather data and science to insurance products across all product segments can only help create transparency both in coverage creation and in loss settlement. This needs to be a goal for all insurers.

Since starting the Out Front Ideas COVID-19 Briefing Webinar Series just a couple of weeks ago, we have been receiving questions from our listeners regarding COVID-19 and how it is changing the landscape of workers’ compensation. With daily changes in regulations occurring across the country, we wanted to answer the most pertinent questions affecting how we handle claims moving forward. 

Three industry experts joined us for our special edition Out Front Ideas COVID-19 Briefing Webinar Series to answer audience questions regarding the impact of COVID-19 on workers’ compensation:

• Max Koonce – chief claims officer, Sedgwick
• Nina McIlree, MD – vice president, medical management, Zurich North America
• Thomas Robinson – co-author, Larson’s Workers’ Compensation Law

What does the term "presumption" refer to in workers’ compensation law?

Presumptions are mechanisms in workers’ compensation law used to switch the burden of proof in claims. Instead of the injured worker needing to prove the injury occurred in the course and scope of their employment, these presumptions state that the illness or injury is presumed to have occurred while on the job. Some presumption laws were already in place, but mainly applied to firefighters and first responders who filed claims related to heart and lung diseases, and sometimes cancer where exposure could have occurred on the job.

In the instance of COVID-19, presumptions are changing on a state-by-state basis. Several states, through either legislation or executive orders, have enacted presumptions relating to COVID-19 occurring in first responders and healthcare workers. Illinois has embraced a presumption that covers all essential business employees who could be at risk of exposure, and other states are looking at similar legislation. 

How do these presumptions define healthcare workers?

A big problem with these presumption orders is that they are often vague. Some define healthcare workers as those on the front lines treating infected patients. Other orders simply refer to “healthcare workers” and could apply to a wide variety of people employed in the healthcare system who may have no exposures to patients. Unfortunately, this lack of definition in new statutes is confusing.

See also: Sustainability in the Time of Coronavirus?  

Are presumptions rebuttable? Is it difficult for an employer to prove that an employee contracted COVID-19 somewhere other than the workplace?

While not impossible, it will be challenging, especially because the goal of presumption laws is to shift the burden of proof to the employer. However, if a fact finder can prove that exposure to the virus came from someone else (e.g., someone was showing symptoms in their household), the employer may be able to file a rebuttal. 

How does the industry handle new COVID-19 claims?

At the foundation of workers’ compensation, we determine each claim based on the merit of each case. That said, are legislative changes in presumptions necessary for cases like healthcare employees who have faced exposure to multiple patients with the virus? Healthcare workers are typically at higher risk anyway, so we already see a higher frequency of claims from their industry.

The current crisis also changes the investigative process for claims examiners. Their process has become much more detailed for COVID-19 claims, including contact tracing and testing to prove positives. In all presumptions, there is more entitlement for specific groups of employees, which creates inequity in claims, when other employees may be just at as much at risk. 

Are the testing and quarantining periods covered within a workers’ compensation claim?

This coverage varies by jurisdiction, but some have required this to be covered under workers’ compensation. Some jurisdictions require the testing and quarantine to be covered under workers’ compensation, even if the employee ultimately is shown not to have COVID-19.

What industries are filing COVID-19 claims?

Healthcare represents the highest percentage of claims, including food service within the healthcare industry. Public entities are also seeing a large number of claims due to first responders. Combined, these industries cover about 65% to 70% of COVID-19 claims. The rest of the claims are coming from essential industries, like grocery stores, where employees cannot practice shelter in place or social distancing. There were also a few early exposure claims from the transportation industry, like airlines, but, with travel regulations in place, those have now almost entirely dropped off.

What is an employer’s liability claim?

When workers’ compensation was initially crafted, employees gave up their right to civil litigation for workplace injuries in exchange for guaranteed no-fault benefits. Under this agreement, workers’ compensation is the “exclusive remedy” for employees who suffer a workplace injury. Employer’s liability is the potential exception to this exclusive remedy. Under very narrow circumstances, certain states allow an injured employee to pursue civil litigation, alleging that the actions of the employer created a situation where the injury was “substantially certain” to occur. In regards to COVID-19, there has been some litigation filed alleging the employer did not provide proper protective equipment and knew employees risked exposure.

If we release an injured worker for modified work, but work isn’t available because of current conditions, do examiners continue temporary transitional employment (TTE)?

Because every state has its own workers’ compensation laws, the answer varies. Some states will insist that benefits be continued for a light-duty release even when an employer has no control over whether a business is currently operating due to current regulations. With a full-duty release, when many businesses are closed currently, the employee would collect unemployment in lieu of workers’ compensation benefits. Continuation of healthcare benefits for injured employees is the most crucial consideration currently, so we can encourage a return to work when businesses do reopen. 

Is workers’ compensation litigation continuing given the current crisis?

State agencies are trying to manage litigation in a few different ways. Some states are using virtual or telephonic processes to work through settlement hearings. Others are using an alternative notarization process, where you can see all members signing necessary documents. The remaining states are using limited staff to process documents needed for litigation to work through the process. There are state agency matrices designed to inform clients and examiners what methods they are using and whether they are currently operating. There is a prioritization of resolutions currently because the public is facing so many uncertainties in their daily lives.

See also: What Comes After the Coronavirus  

When does an employer need to report a claim involving COVID-19 to its carrier or claims administrator?

The best practice is always to report it as you would with any other work-related illness. If an employee says he has been exposed to the virus on the job and wants to file a claim, file it. Consider the future of not filing a COVID-19 claim. For example, does it leave you responsible if you did not take the necessary steps to file a claim, and OSHA gets involved, or an employee decides to file a suit? What if the employee can prove she made a clear statement about being exposed to the virus while on the job?

To listen to the full Out Front Ideas with Kimberly and Mark webinar on this topic, click here. Stay tuned for more from the Out Front Ideas COVID-19 Briefing Webinar Series, every Tuesday in April. View the full list of coming topics here.

Many insurers have made grand, public gestures, returning some $10 billion of premiums to customers whose lives and businesses have been put on hold by the coronavirus, but I'm not sure customers have really noticed. I worry that the insurance industry is losing the messaging battle at a crucial time. We risk being relegated to the traditional role of the bad guy, hiding behind lawyers to deny any and all claims, at a time when we need to be helping customers as much as possible--and need to be seen doing that good work.

Already, some politicians are trying to turn coronavirus into a sort of asbestos, making the insurance industry cover risks that it never signed up for. Yes, with SARS serving as a warning in the early 2000s, the insurance industry wrote policies in recent years that excluded pandemics, in a way that the industry never explicitly excluded asbestos, but public opinion is a funny thing: Groundswells can develop if they aren't headed off at the beginning. And politicians respond to groundswells. After all, it's people who vote, not corporations.

To try to figure out whether the industry had already lost the battle for public opinion, and what more the industry could be doing, I called an old colleague who has been doing PR for major insurance clients for decades. (We'll just call him Sam, because he wants his clients, not him, to be the story.) The good news is that he said the battle isn't lost yet. The bad news is that Sam thinks the industry needs to do a lot more to get the message out that it's living up to its responsibilities while helping clients however possible.

"A lot of people hate the insurance industry," Sam said. "Here's how they see us: Clients pay us a bunch of money, then they have an issue, file a claim, and the insurance company hires a lawyer to fight them--over a product they bought but never received."

He said it's crucial to keep hammering away at the message that insurance companies are in the business of paying claims. They wouldn't have any customers if they didn't pay claims.

"That message gets tricky, of course," Sam said, "because the customer hears, You pay lots of claims, just not mine...?"

Some industry leaders--including Evan Greenberg, CEO of Chubb, and John Neal, CEO of Lloyd's--have seemed to make headway with repeated assertions that the industry can't be saddled with risks it wasn't paid to take on and, in particular, that it simply isn't practical or fair to expect insurers to cover what amounts to the cost of a war.

Hitting those themes, a Washington Post columnist wrote, "While the businesses that are currently shuttered didn’t do anything wrong, neither did their insurers.... Since everyone is getting the benefit [from the shutdown], everyone should pay for it: through borrowing now and taxes later. Think of it as Americans belonging to one of the largest mutual insurers in the world: the United States of America, Ltd."

Sam said the industry doesn't do itself any favors with legislators or customers by referring to its capital as surplus or reserves. "Reserves? Surplus? Come and get it!" he said.

But he said the argument against raiding reserves is pretty straightforward: Claims for business interruption would be some $300 billion a month, for an industry with $800 billion in reserves--and, oh, by the way, that money isn't just sitting there; it's set aside to pay other claims that insurers already face. The industry wouldn't last long in the face of such claims.

Neal has said that just paying legitimate claims will already make COVID-19 the most expensive event in the history of insurance.

The fact that Marsh offered a pandemic policy two years ago and got no takers seems to resonate in conversations I have with folks outside the industry: It hardly seems fair to make insurers pay on policies that customers declined to buy.

But Sam said insurers need to get beyond the defensive. "Nobody reads the fine print until something goes wrong," Sam said, "and if you're spending all your time defending the exclusions in the fine print, then you won't be able to get the stink off you."

Going on offense means working--as publicly as possible--with governments to prepare for the next pandemic. contributing as much wisdom, technique and discipline as possible. That sort of work has already begun in the U.S., with what's being referred as PRIA (a pandemic version of the Terrorism Risk Insurance Act, or TRIA), and in Europe, with what's being called Pan Re.

Sam said that, while insurers need to stick with a hard no on business interruption claims under policies that were never designed to cover pandemics, they need to say yes in every possible way on service to customers in these difficult times.

"We have to cushion the blow as much as possible," Sam said.

When the industry does good things--and I see many--it also needs to toot its own horn more. Maybe the messages are getting lost in the shuffle because of everything else going on, but it seems to me that the industry could do a lot more to dramatize how it's helping clients. The world is hungry for good-news, human-interest stories these days. Yet a friend of mine told me that his auto insurer, one of the top five, didn't even notify him of a rebate on his premium.

"I saw the news about premium rebates, so I called my company," my friend said. "They told me, yes, we're rebating X dollars. I said, "That's great, but was I just supposed to notice on my statement, or were you ever going to tell me?'"

I suggest we tell people as often as they can stand to hear. So far, insurance commissioners seem to be siding with the carriers on business interruption policies, but lots of other forces are aligning against the industry. Consumer groups are complaining, and politicians are listening. Some civil authorities are using language in shutdown orders designed to trigger insurance coverage, and legislators in several states are considering forcing insurers to cover business interruption claims on the pandemic. Even the president said two weeks ago that insurers should cover many claims. The plaintiffs bar is, of course, ready, willing and able to help with such claims.

If Sam is right--and he's more optimistic than I am--then the industry has time to stand up for itself. But time is running short. If the tide turns, it will likely turn for good.

Stay safe.

Paul Carroll

Editor-in-Chief