Insurance leaders, you spend every day helping customers plan for the future, and you know that disaster can strike anyone, anytime. But have you done all you can to prepare your company for what the future holds? Whatever lines of insurance you sell, there’s just one policy for company longevity: a strong leadership pipeline. Unfortunately, many insurance companies forgo this essential coverage. Last year, Deloitte found that just one in three insurance companies believes its future leaders are prepared to respond to tomorrow’s business challenges — despite 87% citing leadership development as a priority. What’s so important about leadership development? For one, leadership quality cuts straight to the bottom line. Equity analysts place, on average, a 16% premium on company stock prices when they see effective leadership. But when they perceive a company’s leadership is ineffective, analysts discount the company’s stock price by about 20%. Strong leaders build value because they know people are an insurer’s greatest asset. They recognize that empowering team members pays off in loyalty, reduced turnover and enhanced customer service. I’ve seen my company through nearly a quarter of its centennial life, and through the course of my career I’ve learned a thing or two about insurance leadership. Like many of us — be honest — I didn’t grow up dreaming of a lifetime in insurance. California Casualty was my first job out of college, though, and it’s been the incredible career I never expected. The company’s mix of challenge, inspiration and flexibility has helped me grow from sales consultant to team manager to vice president. But I’d have never reached the position I’m in — not to mention stayed for two decades — had I, too, not learned from strong leaders. Now it’s my turn to find the company’s up-and-coming leaders, and I look for five traits in tomorrow’s standard-bearers. See also: The Insurance Renaissance, Part 4 First and foremost, effective leaders have integrity. Integrity is difficult for some, but it’s actually a simple concept: People with integrity do the right thing even — and especially — when no one is watching. In our industry, policyholders depend on us to fulfill our obligations, often when they’re most vulnerable. That’s why California Casualty created a written code in 1965 to act as the company’s moral compass. It champions integrity and the singular importance of doing the right thing for our customers. The code reminds me — and future leaders — that it’s better to fall short of our goals than to meet them through dishonesty. Strong leaders must also be able to influence others, and I’ve seen firsthand the importance of inspiring, motivational leadership. Before any sweeping change, my company informs key influencers and involves them prior to the full-staff rollout. This creates buy-in and helps them serve as role models to team members who might not feel as comfortable with changes, and provides hands-on leadership experience before they truly take charge. Confidence, tempered by humility, is another quality I’ve found is essential for insurance leaders. These leaders surround themselves with team members whom they can learn from — and whom they can teach — when exploring issues and making tough decisions. Confidence also means being transparent with your team. I don’t always make the right decision, but I’m confident that, if I make a wrong move, my team and I will work together to adjust, learn and improve. Alongside confidence, I look for flexibility balanced with accountability, which helps to unlock a team’s potential. When I first became a team manager, I learned that my sales strategy didn’t necessarily work for others. I had to step back and recognize that there’s more than one way to exceed targets. There’s one final trait all successful insurance leaders share: strong communication skills. To build a successful team, you must clearly articulate goals and the drivers behind them. At our sales rallies, we talk about targets, of course, but we also seek to understand the “why” behind our numbers. We recently implemented underwriting changes, for example, that made it more difficult for sales consultants to sell policies. Taking time to discuss policies’ loss ratios and profitability issues has helped our sales team adapt to these changes and improve the company's future. See also: Can Insurance Innovate?   With all the important qualities an insurance leader must possess, it’s tough to find tomorrow’s perfect leadership team. But once you’ve identified promising candidates, you’ll need to help them rise to the challenge. First, start with face time. Get to know tomorrow’s leaders on a personal and professional level. To help them define what they want to achieve — both in their current role and in the next — work with them to create short-term and long-term goals. Boredom lurks behind turnover, so setting “stretch” goals is a great way to keep up-and-coming leaders engaged. Second, find opportunities to let them shine. Never underestimate delegation as a leadership-building tool. When employees are given ownership, it builds their confidence, showcases their talents to others and prepares them for their next positions. I give young leaders opportunities to assist with recruiting and hiring, mentoring new associates, and leading annual meetings. Next, give them a say in company decisions. Employees at all levels have fresh ideas that can benefit the company. By giving them a say, you nurture growth, learn their thought processes and cultivate buy-in at the same time. Finally, build bench strength. Don’t wait for a position to open. Employ an approach of continuous development to ensure you can tap the right talent when you need it. Plan ahead as you hire: Employees who understand technology and analytics will be increasingly important for insurance leadership. In the end, insurance leadership isn’t about titles, nor is it about sales figures. In our industry, it’s our job to be there in policyholders’ times of need; we have the chance to truly improve lives. So while I may not have always dreamed of an insurance career, it has been an incredibly fulfilling one. Now it’s my job to find new leaders who feel that way, too.

Google the phrase “working with millennials,” and more than 22 million results pop up. No other generation has had so much emphasis placed on them as they entered the workforce. Recently, I attended a conference where the primary or secondary focus of nearly every session was how to deal with millennials, or how to make the workplace more palatable to millennials or why we should make millennials comfortable. Who Cares? One panel speaker made two points that sum up the problem: 1) Why do we feel like we need to cater to the millennials? They are coming into a place of work, a professional atmosphere where they need to figure out how to get along with everyone else and not the other way around; and 2) It’s not all the millennials' fault – parents are to blame. Toward his second point he gave two examples, but one really stood out. A millennial showed up for an interview accompanied by her dad. This speaker knew the father, so he assumed the father was just there to say hello and make the introductions. No! When the prospective employee was asked to come into the office for the interview, her father followed right in behind her. I don’t think she got the job. Several years ago, a Harvard Business Review article addressed the problems created for millennials by their parents. One manager interviewed for the article said that if he gave a poor evaluation to a millennial he often got a call from the parents. What!!?? It’s not necessarily the millennials who are the problem, but the parents who have always tried to make things easy for their kids – never letting them experience failure or, Heaven forbid, discipline. See also: The 'Sharing Economy': What It Means for Insurers (Part 1 of 3) No Different Than Us – in Some Ways Let’s face it, college graduates today are no different than we were the day we graduated. We wanted to be in charge and have our ideas appreciated and applied from day one. We were brilliant; after all, we just graduated from college (I wish I was as smart now as I thought I was the day after graduation). We thought we were worth more than we really were. But someone was patient with us. In the same way, we need to be patient with and help (not cater to) this new generation. But there are some differences between past and current generations. Past generations knew – sort of – that there were “dues to be paid" (and what was meant by “dues”). We knew that there were consequences for actions we took. We knew the battles were ours and ours alone – our parents did not feel the need to call our boss (personally, I would have been ashamed to have my battles fought by my parents – especially as an adult). We learned – rather quickly – that we weren’t nearly as smart or important as we thought we were. But the biggest difference: We knew the workplace was not going to change to suit us; we had to fit into it. If we wanted the workplace to change, we had to wait until we were in charge. This is where we are doing millennials a disservice. Their parents protected them from the realities of the world, and now we, as employers, are doing the same thing. No one can grow professionally if they are never allowed to make mistakes, suffer the consequences and learn how to recover stronger. Allow these newly minted adults to grow up, especially if their parents never allowed them to suffer the consequences that they needed to suffer to mature!

On the day after the U.K. referendum voted to leave the European Union, a leading U.K. newspaper ran a cartoon with the caption, "Democracy is too important to be left to the people." Of course, it was tongue in cheek, but the point was well made. Since the vote, markets globally have tumbled, shares in financial institutions have fallen, some as much as a third, the U.K. has "lost" Prime Minster Cameron and some are already seeing this referendum as the first sign of the breakup of the European Union. In my blog of Feb. 29, "What Happens if U.K. Exists the E.U.?", I suggested that, for the insurance industry, nothing good would come of the U.K. leaving Europe. I wasn’t alone in that thinking. In the days immediately before the vote, 20 European insurance institutes signed a letter asking that the U.K. not leave. The U.K.-based institute of brokers BIBA urged its members to vote to remain. Surveys of U.K.-based insurance executives showed almost universal agreement to stay. But everyone was allowed to vote, not just insurance professions. The results showed massive division between different parts of the country, and even directly within families, with the agenda dictated ultimately by three key aspects: the economy; sovereignty and immigration. Some are currently arguing that the third factor, immigration, was the most persuasive and divisive – but in fairness they do a disservice to the complexity of the arguments. In my lifetime, this event is outstanding in that almost everyone had a point of view, and in many cases were prepared to vocalize it. One madman even exercised his democratic freedom by murdering a member of the U.K. Parliament on the other side of the issue. Overall, it was a dirty campaign that, if anything, has undermined the public’s trust in our public representatives. The challenge really rested with the bilateral nature of the decision. You were either Remain or Leave. There was no halfway house or room for indecision. And then the results came in. And chaos was unleashed. The philosopher and statistician Nassim Taleb talks about “black swans" – events of low probability but maximum impact – and many are saying that this is one of them. His 2007 book Black Swans – Coping With the Improbable suggests that many financial services organizations are simply not prepared to cope with losses beyond what they have predicted in their models. But this isn’t entirely true. One major U.K.-based global insurer has already said that, despite its stock value falling by 25%, it has adequately stress tested its business. I really hope that it represents the wider U.K.-based insurance industry, as opposed to being a one-off. Even so, asset managers are already actively reviewing their portfolios, and there will inevitably be a number of knock-on effects. What all this means for the man in the street remains uncertain. In a saturated market, suffering from overcapacity, will the "leave" vote affect insurance premiums and, if so, in what way? There is already a threat of increased taxation, and it’s unlikely that the insurance industry will remain unscathed. How the major global insurers based in mainland Europe will respond to the U.K. "issue" will also make interesting viewing. The fall in value of U.K.-based insurers coupled with the weaker pound sterling will make some U.K. insurers extremely vulnerable to predators, especially those keen to gain a foothold in the Northern hemisphere. Do not be surprised by some M&A activity in the coming months. At the end of the day, despite all the uncertainty, this is an industry – and a country –that is characterized by resilience. For those working in it, and living in it, we have to be honest and recognize that there are likely to be difficult times ahead. But whatever we think of the vote, the essence of how we choose to live in the U.K. (and the Western world) is in respecting the will of the people. Let’s just get on with it.

No industry has been witness to as many changes in the business world as insurance. Paradoxically, the insurance industry has remained (relatively) the same operationally. However, it can no longer turn a blind eye to the change rapidly occurring around and within insurance. The need of the hour is not “inno-va-shun”— shying away from necessary change. It is a straightforward pursuit of real innovation, the combination of modernization and creativity that will capture business and keep it. Unfortunately, our minds have conjured up thoughts around innovation that make it seem like more of a hurdle than it actually is. We may harbor futuristic, expensive, technologically impossible notions around the term. But innovation, stripped of all the hype and abstractness associated with it, is simply a survival tool that will foster competitiveness and growth. There is little mystery involved, and there is much opportunity for payoff to the business. In some cases, becoming innovative is as simple as lifting off traditional constraints. Experts within and outside of insurance are centered on constraint removal, asking, “What is the shortest path from unmet insurance needs to insurance sales?” This has sparked an investment frenzy. InsurTech, (a variant of Fintech) is focused on innovation and investments in insurance, and it is growing by leaps and bounds. CB Insights reports a figure of $2.65 billion in InsurTech investment for 2015, representing 350% growth over 2014 investments.  According to PwC’s survey based on companies included in their DeNovo platform, funding of Fintech start-ups more than doubled in 2015, reaching $12.2 billion, up 118% from $5.6 billion in 2014. Cutting-edge InsurTech and Fintech companies are forcing insurers to take a radically different look at the competitive landscape. There is an increasing awareness by insurers of this change, reflected in a PwC report indicating that 74% of insurance companies identified their own industry as the one part of the financial services sector that will most likely be disrupted by FinTech over the next five years. So what innovation is happening in insurance?  Is it all about hiring a set of experienced contrarians, providing them with a fertile environment, lots of time and space and access to unlimited funds to come up with an assembly line of  “the next” ideas that will radically transform the insurance industry? That sounds exciting. Who wouldn’t want their own highly funded insurance incubator? See also: How to Plant in the Greenfields   The truth is far more prosaic. Innovation in insurance is not just restricted to developing new solutions and technologies or products and services but it is grounded in the consistent development of new offerings, channels and business models to reach and expand in existing and newer markets. It is the building of the next-generation insurance operation that will work as the world changes. Rather than wait for transformation of the existing business, insurers are looking to innovate, reinvent and create new business models to operate and succeed in a new business paradigm. The time is ripe to experiment and be part of the disruption unfolding, rather than being left by the wayside Helping fuel the innovation is an array of new partnerships, accelerators, incubators and innovation labs within the industry and individual companies. They are creating solutions, products, services and business models, de novo options – de novo, from the Latin expression meaning “from the beginning,” “afresh,” “anew,” “beginning again.” And it is not just new capital backing de novo models. Existing traditional insurers are investing into their own greenfields, start-ups and incubators. They are launching new companies and business models to reach new market segments and introduce new products and services. They are carefully building and maintaining the new efforts outside of the traditional brand, distribution channels and business operations to keep the new efforts out from under traditional constraints. There is a wide array of experimentation and de novo options happening within insurance companies to respond to these challenges by generating opportunities. But to do so, these insurers need a “platform solution” that will enable agility, innovation and speed, not unlike platform solutions that have powered de novo options in other industries. Fundamental to the platform is the need for low IT costs because investment must be focused on the business, products and channels, not in the capital and operational expenditures for the traditional bricks and mortar infrastructure. An insurance cloud platform can be the differentiating and critical enabler. See also: InsurTech: Golden Opportunity to Innovate   New platforms need to go beyond the core insurance solution to include ready-to-use, pre-built content, data sources, channel options and best practices that can jump start the business. An ĵacceptable timeframe would be weeks to months, instead of the years that many business transformation projects require. The insurance industry is quickly realizing the need for innovation. It is not a question of when … but how soon one innovates. New insurance companies, MGAs, underwriting firms and others are incubating new products, new business models and new channels and reaching new market segments. The unprecedented number of new endeavors is a clear indication of this phenomenon. Yet, too many insurers are locked into legacy core systems or engaged in multi-year legacy transformation programs, limiting their ability to innovate and experiment with de novo options. Rather than waiting, insurers should aggressively seek to leverage a “platform solution” as outlined in the Majesco report, Greenfields, Startups and Incubators: Innovation in Insurance Products, Channels, Services and Business Models. Experimenting and innovating today will prepare insurers for tomorrow’s opportunities. One cannot but agree with Rob Siltanen when he said, “Here’s to the crazy ones. The misfits. The rebels. The troublemakers. The round pegs in the square holes. The ones who see things differently. They’re not fond of rules. And they have no respect for the status quo. You can quote them, disagree with them, glorify or vilify them. About the only thing you can’t do is ignore them. Because they change things. They push the human race forward. And while some may see them as the crazy ones, we see genius. Because the people who are crazy enough to think they can change the world, are the ones who do.” How are you preparing to change your world — the world of insurance?

The rising business use of cloud services and mobile devices has opened a Pandora’s box of security exposures. Software as a service (SaaS) tools such as Salesforce.com, Gmail, Office 365 and Dropbox, as well as social media sites such as Facebook, LinkedIn and Twitter, are all being heavily leveraged by companies to boost productivity and collaboration. This SaaS trend also has opened up a whole new matrix of access points for malicious attackers to get deep inside company networks. Wall Street recognizes that all organizations will have to acknowledge and make decisions on how to mitigate new business risks introduced by cloud services. And big bets are being placed on new technologies to help companies get a handle on these fresh exposures. See also: The Need for a Security Mindset ThirdCertainty recently sat down with David Baker, chief security officer at Okta, a cloud identity management vendor that’s one of dozens of security vendors developing cloud security systems. A $75 million round of private investment last fall pushed Okta’s market valuation to more than a billion dollars, vaulting it into so-called “unicorn” status. Okta’s backers include a who’s who of venture-capital firms that are placing big bets on cybersecurity plays: Andreessen Horowitz, Greylock Partners, Sequoia Capital, Khosla Ventures, Altimeter and Glynn Capital, among others. Baker talked to us about this particular big bet on cybersecurity tech. The text is edited for clarity and length. 3C: Congratulations on achieving unicorn status.

Baker: Thank you. We have a lot of work to do as a company to continue growing. The problem that we solve is really about enabling companies —  enterprises, as well as small, medium and big companies — to adopt the cloud. 3C: How would you frame the big challenge? Baker: The problem for companies now is that the things I need to access in the cloud bring a whole host of security concerns. I have users working within my four walls, and they have to authenticate into these applications where I have critical business data. It could be information about my company’s source code, or email or all of the files we share. So what’s needed is a secure way of authenticating users into all of those systems. It also is a challenge to provision that identity into the downstream applications and, just as importantly, to de-provision users. So when a user eventually is transferred to a different group or is terminated, their access has to be disabled. So it’s about managing that identity and also managing the access of that identity to these cloud services. 3C: Lots of employees set up their own Gmail or Dropbox account to be more productive. It sounds like they shouldn’t be doing that? Baker: Correct. The security piece is knowing what set of tools you want your employees using, and then making sure you have an authentication mechanism in place to enable them to go securely into those cloud-based applications. See also: Cyber, Tech Security Start to Merge 3C: The company sets the rules, and its employees should use only the company-sanctioned versions? Baker: Correct. Users get exactly the version of Dropbox the company wants them to use, not their own personal account. Okta creates a secure connection to that version. The IT administrator can give the employees access to hundreds of apps. Right now, we have connectors to well over 4,000 different applications across the internet. 3C: Seems like we’re extending the traditional network perimeter. It’s not just the on-premises servers and clients that companies have to be concerned with, it’s everything out in the internet cloud that employees might try to use. Baker: I’ll do you even one better. The perimeter really exists with respect to identity. When I’m sitting at home or in the coffee shop and using my cellphone to get access into an application, I am now the perimeter. So that’s why we like to say, really, identity is the new perimeter. This article first appeared at Third Certainty. More stories related to cloud security: Be selective about what data you store and access from the cloud Cloud apps routinely expose sensitive data SOC-2 compliance crucial for keeping data safe in the cloud

The 2^nd Appellate District has issued the first of what should prove to be several appellate decisions on the timeliness of independent medical review (IMR) decisions. The court was considering the assertion by a W.C.A.B. panel that IMR timelines are mandatory and that late IMR means the W.C.A.B. -- and not doctors -- will determine whether treatment is medically necessary. In SCIF v W.C.A.B. (Margaris), the court annulled the W.C.A.B. decision and remanded with instructions to issue a new decision. The court’s reason for accepting this case was set out early in the decision: “…We issued a writ of review because this case presents an important issue of first impression regarding the interpretation of section 4610.6, and because it relates to an issue upon which the appeals board has rendered conflicting decisions.” In its analysis, the court provided an extensive discussion of the history of authorization for medical treatment, the implementation of utilization review (UR) for treatment requests and the enactment of the statutory scheme for IMR.  As noted by the court in SB 228 and 899, the legislature changed both the standards and process used by an employer to evaluate a request for medical treatment. The legislature adopted the medical treatment utilization schedule (MTUS). The legislature then removed the existing process for resolving medical disputes using dueling doctors and required the use of utilization review, which required review of treatment requests in light of the MTUS. In 2012, the legislature enacted another set of reforms to address disputes over UR determinations. As noted by the court, a UR determination authorizing medical treatment was binding on the employer but became subject to further review through IMR — but only for the employee. The court further observed that even where an IMR determination is ultimately reversed by the W.C.A.B., the issue of medical appropriateness was to be returned to IMR for further review, not decided by the W.C.A.B. See also: IMR Practices May Be Legal, Yet…   Turning to the specific issue before it, the court determined the use of “shall” in Labor Code 4610.6 was directive, not mandatory: “…The appeals board concluded that section 4610.6, subdivision (d), is clear and unambiguous.  According to the appeals board, “shall” is mandatory, and any IMR determination issued after the 30-day time frame is necessarily invalid. In support of this interpretation, the appeals board cited section 15, which provides “‘[s]hall’ is mandatory and ‘may’ is permissive” (§ 15.). Thus, the appeals board concluded that construing “shall” as mandatory, such that an untimely IMR determination is invalid, comports with both the ordinary meaning and the statutory definition of “shall.” As we explain, however, the issue is more nuanced than the appeals board recognized. … We note that section 15, upon which the appeals board relied in this case to support its interpretation of section 4610.6, subdivision (d), juxtaposes “mandatory” against “permissive,” which arguably suggests the legislature used “shall” in the obligatory permissive sense rather than in the mandatory-directory sense, as the appeals board concluded. (See McGee, supra, 19 Cal.3d at p. 960 [discussing section 15 and concluding that “on its face, the statutory language suggests that the legislature intended the present provision to be mandatory (i.e., obligatory), rather than permissive.”]) However, given the difference in meaning given to “shall” in the statutory context, we conclude section 4610.6, subdivision (d), is ambiguous. Accordingly, we move beyond the plain language of that section and consider its meaning with reference to the rest of the statutory scheme and the intent of the legislature.” The court commented further on this issue: "Generally, time limits applicable to government action are deemed to be directory, unless the legislature clearly expresses a contrary intent.  (Edwards, supra, 25 Cal.3d at p. 410.) “‘In ascertaining probable intent, California courts have expressed a variety of tests. In some cases, focus has been directed at the likely consequences of holding a particular time limitation mandatory, in an attempt to ascertain whether those consequences would defeat or promote the purpose of the enactment.  [Citations.] Other cases have suggested that a time limitation is deemed merely directory ‘unless a consequence or penalty is provided for failure to do the act within the time commanded.’” The court also found the lack of a penalty or consequence for noncompliance to be significant. Citing similar language in actions by the state personnel board, which had been held to be directive rather than mandatory, the court suggested a failure to meet the statutory time frame did not result in a loss of jurisdiction. The court also indicates in its review of the mandatory vs. directory dichotomy that statutes that set time frames for government actions that do not include a self-executing consequence are almost universally construed as directory. The court also noted that construing the 30-day time frame as directory furthers the legislative objective of SB 863. “We conclude from these findings that the legislature intended to remove the authority to make decisions about medical necessity of proposed treatment for injured workers from the appeals board and place it in the hands of independent, unbiased medical professionals. Construing section 4610.6, subdivision (d), as directory best furthers the legislature’s intent in this regard. The appeals board’s conclusion in this case — that an untimely IMR determination terminates the IMR process and vests jurisdiction in the appeals board to determine medical necessity — is wholly inconsistent with the legislature’s stated goals and their evident intent. … Finally, and perhaps most tellingly, the legislature provided that, “[i]n no event shall a workers’ compensation administrative law judge, the appeals board, or any higher court make a determination of medical necessity contrary to the determination of the independent medical review organization” (Stats. 2012, ch. 363, § 45, codified at § 4610.6, subd. (i)). We find this portion of the statute — particularly the use of the phrase “in no event” — to be a frank expression of the legislature’s desire to remove the issue of medical necessity of proposed treatment from the jurisdiction of the appeals board in all cases subject to IMR. The legislature’s intent would be defeated by giving section 4610.6, subdivision (d), mandatory effect, as the appeals board did in the present case.” See also: 20 Work Comp Issues to Watch in 2016 Additionally, the applicant attorney argued that the W.C.A.B.’s holding in the Dubon case (Dubon 2) supported the W.C.A.B's usurpation of authority to decide medical treatment. The court noted the holding in Dubon 2 is supported by the AD’s regulations providing that IMR applies solely to timely and procedurally proper UR but that no similar regulation existed for IMR. The court declined to comment on the W.C.A.B.’s decision in Dubon 2 as the issue was not before it. Comments and Conclusions: There are currently two other cases pending in the appellate courts, both in the 3^rd appellate district — on this same issue and, interestingly, this case was not the first grant on the issue. However, the court set a very aggressive briefing schedule and, even with multiple amicus briefs it heard, considered and decided this case in, what is by appellate standards, a very short time (less than six months). Clearly the court was very interested in this issue, which had multiple W.C.A.B. panel decisions with conflicting holdings. The court, in its decision, also rejected arguments offered by both the applicant and the W.C.A.B. that untimely IMR resulted in unnecessary delays — a rationale offered by the majority panel in both Dubon and Margaris. The court, very astutely, noted this argument made no sense given the time frame for obtaining QME opinions or litigating medical treatment issues before the W.C.A.B.  The court pointed out that, even with the delays in completing IMR, the W.C.A.B. decision was more than 13 months after the initial decision in UR and more than 10 months after Maximus rendered its decision. The court was clearly, and properly, skeptical of the argument that letting the W.C.A.B. decide medical issues would result in a more prompt disposition. The court did offer an option to applicants to challenge untimely UR through the ability to file a petition for writ of mandate to compel a decision. While a statutorily viable option, this is impractical, especially in light of the current timeliness of most IMR determinations. Further, the issue here has never really been the timeliness of IMR. The goal for the applicant attorney bar, and apparently some of the commissioners, has been to usurp the medical decision making process from being medically driven to being litigation-based. The decision does not provide a lot of nourishment for those who are waiting for some sliver of light on the Dubon 2 issue. The court, in its footnote, declined to really comment on Dubon 2, but it did note there was some basis for the W.C.A.B.’s decision. However, the very strong language of the court emphasizing the public and legislative policy behind having medical decisions made by physicians, and the much greater speed and certainty of the UR/IMR process over the legislatively disfavored litigation process, may provide some hope that, given a chance, the appellate court would also reject the W.C.A.B.’s arguments in support of Dubon 2.

This essay takes issue with the Oklahoma Supreme Court’s recent decision in Torres v. Seaboard Foods to declare some workers’ compensation (WC) laws unconstitutional. The problem with the opinions of Justices Edmonson, Combs and Colbert isn’t simply that they reached the wrong conclusion — but that they reached it for the wrong reasons. To justify their decision, all three justices went out of their way to invoke the grand bargain, a historic compromise between employers and employees that guarantees medical and wage replacement benefits to injured workers. Before the grand bargain was struck in 1917, most U.S. employees injured on the job had to sue their employers for damages. The process was often prohibitively expensive, onerous and time-consuming for hardworking citizens who found themselves unable to earn a paycheck — when they needed funds to cover medical bills and other expenses during their convalescence. The grand bargain is worth championing because it put an end to this intolerable state of affairs, thanks, in part, to luminaries such as Crystal Eastman, who thought an injured worker shouldn’t have to spend “nearly half of (his settlement) to pay the cost of fighting for it.” See also: Taking a New Look at the ‘Grand Bargain’ Eastman’s emphasis on avoiding long, costly court battles was typical of the thinking that guided the U.S. into embracing the grand bargain. It is therefore disappointing to see Justice Colbert argue that he is “forced to insure that claimants and employers in the (WC) system have their day in court." Colbert’s rationale is contrary to grand bargain principles. The only thing forcing Colbert to such a conclusion is his decision to put the interests of injury lawyers ahead of the interests of injured workers and of the employers who provide the benefits those workers deserve. If the Oklahoma Supreme Court is as committed to preserving grand bargain principles as Justice Colbert claims, it doesn’t need to do anything revolutionary. It only needs to rule in the same way that it did in 1917, when it initially recognized the state legislature's ability to pass special legislation concerning WC in the interest of the general public. This article is the summary of a much longer essay on the topic, which draws on numerous primary and secondary sources and which you can find here.

If insurance were a map, we would be surveying a whole new world. The fences and boundaries of tradition have fallen. The snow-capped mountains of certainty are melting away. The rivers of market share are changing course, and streams of data are coming directly to our doors. We know there are still products to plant and fields to harvest, but how will our planting change in the months and years to come? Many insurers will be looking at greenfields for the answer. Greenfields, start-ups and incubators are different ways of looking at the same essential concept — starting from scratch. Each is a new beginning. Greenfields are new initiatives often aimed at developing new markets. Start-ups are most often new initiatives that will reach existing markets. Incubators are designed to test new products within new or existing markets. For our purposes, we will lump them all together under the title of greenfields, because from an organizational perspective the need for them and preparation for them are similar. See also: Start-Ups Set Sights on Small Businesses Cultivating the soil Think about how insurance has grown, just based on the questions we have asked ourselves over time. Insurers used to ask, “How do we do what we do better?” They were thinking of underwriting, selling and meeting market demand. As the internet and the digital realm arose, they began asking themselves, “How do we do what we do differently?” They needed to know how to reach the same people with better channel management and improved customer service. Now, they are asking, “How do we do what we don’t currently do at all?” They want to know how to identify, build and capitalize on new risk needs, new markets and social networks, how to use technology to its fullest, how to become a trusted resource for services outside of insurance and how to reinvent the organization and brand so that it is prepared to be profitable no matter what initiatives lie on the horizon. It is the preparation that is an important first step. A great idea can’t take root in an organization that won’t support it. How can insurers prepare for greenfield development? Abandoning silos Greenfield insurance companies that are starting outside of a traditional insurance organization and those that are starting under the umbrella of traditional insurance companies both value “fresh air” and an environment that is unclouded by tradition. Starting from scratch allows them to think without constraint, test without constraint and operate without constraint. They do have barriers. Most are operating within a window of opportunity, and all are operating under the assumption that investments need to pay off. But for the most part, greenfields take advantage of the fact that organizational politics, processes, traditional technologies and time-honored ideals are all open to reassessment, replacement or removal. Organizational silos need to be bridged, if not completely abandoned. The new opportunities where greenfields will work best will be created by cross-functional teams that understand how to integrate new technologies with the best ideas. This is one reason hackathons have recently grown in popularity. They are simply borrowing a common concept from ad agencies, TedX events and jazz musicians…the idea that walls and ideas aren’t compatible. The best fertilizer for ideas is a diverse set of perspectives on how the idea will be constructed and how it will work in practice. Teams need functional area experts, but they also need general leadership with a holistic perspective as well as input from technology partners who grasp what is technologically possible. Investing in seeds Seeds are investments, and most investments have phases. The greenfields in insurance are ripe for these investments, and they are bearing fruit. But those that will be most successful will pay close attention to planting methods. For example, farmers don’t take the newest seeds and plant 1,000 acres. They test them in plots. In insurance, our ideas need to be cultivated quickly, first in small pots, in our incubators and centers of excellence — we can call these our insurance greenhouses. If they appear to be working, we test them in small geographies, then roll them out to larger segments. Seed planting is speed planting. The idea works, or it doesn’t. We scale up quickly or toss the idea out. We invest wisely by investing small, until the investment proves itself and then we invest more. As we watch seed money flowing into InsurTech, we know that some of these investments won’t pay off. Many venture firms will have invested more in a proof of concept than they should have. Some will attempt a rollout before the concept is mature. The best growth will happen through organizations that know how to phase greenfield investment. See also: Investment Oversight: Look Beyond Scores! Greenfields will be capitalizing on technology to save investment funding. This includes reusing technologies and sharing systems. Cloud platforms with a “pay as you go” pricing model are perfect for greenfield development because they answer the demand for agility, innovation and speed (low implementation time, quick speed to market, light or no customization) with lower investment and maintenance costs … allowing the investment to focus on the business, not the infrastructure. Greenfields are creative pursuits to new opportunities. Their back-end solutions will require just as much creativity as their front-end marketing, but they will want solutions that don’t require massive customization. Greenfields will therefore capitalize on what they don’t need to build from scratch. Modern core platforms will allow them to use pre-built, integrated content and data sources, pre-built best practices and products and pre-built channel options. They will use their creativity to build new business models around pre-built infrastructures, instead of building new systems from the ground up. The passion for planting In the coming weeks, we will take a more in-depth look at greenfields, start-ups and incubators. We’ll look at the surprising growth of insurance innovation investment and what it means to existing businesses. We will discuss how deeply the choice of platform can affect insurer preparation, and we’ll also look at the greenfield spectrum that includes new value-chain technologies, new aggregator channels and completely new types of insurance. Our goal is not to gawk at the high number of entrants into the market, but to glean a whole new perspective on opportunities. You may find that your unique position will allow you to have market-capturing ideas ahead of others. And you may develop a passion for planting your own seeds in the greenfields of opportunity. Is your organization ready for your team’s next great idea?

You’ll get no argument from anyone in the global cybersecurity community if you make this statement: “There needs to be a paradigm shift in the way organizations of all sizes view information security.” There are unmistakable signs that such a sea change is underway, driven by intensifying cyber exposures. But organizational change at a macro level won’t happen overnight. And a certain level of turmoil can be expected as the productivity side of the house battles for budget with the security side. That’s the upshot of an impromptu discussion I recently had with three top cybersecurity experts from consulting giant Deloitte. Ed Powers and Scott Keoseyan—U.S. managing principal and cyber threat intelligence director, respectively, at Deloitte’s Cyber Risk Services practice—and Adnan Amjad, a partner with Deloitte’s U.S. Cyber Threat Risk Management practice, helped lead Deloitte’s cybersecurity consulting services, which last year assisted nearly 1,000 clients with cybersecurity planning, including numerous large enterprises and federal agencies. See also: How to Eliminate Cybersecurity Clutter What Powers, Keoseyan and Amjad continue to hear is that the frustration level among senior management is rising. Despite truckloads of cash being spent on the latest defensive technologies, cyber risks continue to intensify, seemingly with no end in sight. Keeping tabs on information Powers told me many organizations have been unsuccessful because they “predominantly use technologies for sharing information rather than protecting it.” That approach includes virtualized data centers and cloud computing. While both can boost productivity, collaboration and innovation, they also introduce complexity, which translates into new exposures to intruders with malicious intent. Organizations must remember that they often are using technologies that have not—from a security standpoint—kept up with the pace of broader business innovation, Powers said. See also: How Good Is Your Cybersecurity? A very fundamental shift—the organizational thinking—must take root, Amjad said. Security must be built into systems from the beginning, and organizations must be more vigilant monitoring them. It’s also critical that the systems have capabilities to respond to cyber attacks. Not just an IT problem And the productivity side of the house needs to work more in concert with the security side of the house. People must be cognizant that cybersecurity is a business issue— not just a technology issue. Of the nearly 1,000 cyber clients Deloitte served last year, many said security is a first-order business risk. That way of thinking may be a difficult transition for lots of companies, so it must start at the top of the organization and permeate down. Security landscape evolves Some industries have caught on. Big banks recognize that security is a business issue for them. They are aware that the safety of their and their customers’ data is important. And some companies in the health care, manufacturing and energy industries have come to understand that cybersecurity is a critical part of their operations. Many organizations, however, lag way behind in cybersecurity and must catch up. Like their counterparts with better security measures, they should determine the actual risk they face. Even the board members should be trying to understand this. Organizations—even sophisticated ones—also must realize that protecting their own four walls is not sufficient. There are too many bad actors using numerous methods and routes to penetrate through the barriers and get access to critical information. Organizations must understand the vulnerability footprint of the people with whom they do business on a regular basis and be certain their supply chains also are secure. This article first appeared at Third Certainty.

In 1965, as college freshmen in the Deep South, we were oblivious to the cultural revolution that was starting to sweep campuses around the country. We were tradition-bound and institutionally managed by a dress code. Our hair could not touch our shirt collars (shirts with collars were mandatory) or cover our ears. Our shirts had to be tucked in, and a belt was required, as were socks. We were free to dress anyway we wanted within those restrictions, and we did. Most chose blue shirts with blue socks or yellow shirts with yellow socks, and, for the bold members of our class, there were pink shirts with pink socks. We wore the same uniforms; only the colors differed. Obviously, these clothes were so “1964 and high school.” So as we grew into sophisticated freshmen with a larger world view we advanced our wardrobe to include Madras (bleeding Madras) in shirts, shorts and some slacks. At last we were different – we were all different – just in the same way. In less than another 18 months, the craziness that was the West Coast – the hippie movement – arrived on campus. Our dress code was gone as fast as our belts and socks. Our bleeding Madras was replaced by cut-offs and tie-dyed T-shirts. At last, we were free to be individuals – to do our own thing – and we did. All of us did our own thing – just the same thing. Fast forward 40 years, and I’m in an agency board room listening to an agency’s management team discussing plans for a new website and a new proposal format to showcase the agency's uniqueness – how it differs from competitors. My question was simple: What makes you different? Give me five or six real, definable and measurable examples of offerings that you bring to the market that your competitors don’t or can’t. The discussions were bold (like college freshmen) and the ideas as diverse as our then-new wardrobes, but to me the sameness was obvious. As they bragged – I gagged. What they saw as “bleeding” Madras, a revolutionary new look, I saw as yellow socks and yellow shirts – and I knew that the competitors were wearing the same wardrobe, because I had been in their closets, too. After several hours and more “styling,” the team agreed on what made them different. I listened politely, then restated their list to be sure that what I heard was what they said. All agreed. Now the challenge was to bring this list to life in a website and presentation. I could live their delusion no longer. I stated, “I know most of your competitors, and they make these same claims and provide the same offerings. In fact, some of them use the same resources to deliver these same offerings. Where’s the difference?” I hit a nerve. One of the producers said, with significant frustration, “Yeah, but we really do it.” With equal frustration, I stated confidently, “I can call each of the principals of all of your competitors and ask them if they really do these things, and I promise you they will each say, Yes.” To prove the point, I created a spreadsheet with the nine major competitors of their agency listed. I then studied the website of each and captured two or three of the most significant “brag points.” Finally, I hid the names and brought the spreadsheet with me to the next meeting. I said, “Tell me which is your agency - it should be easy because you are unique.” After many attempts, they acknowledged that they couldn’t because they weren’t. Before you discount this article and this challenge as not applying to your shop, I have one suggestion. Try it. Can you find your uniqueness? Would your clients find it? Would they believe it? How long have you had that nice Madras shirt? See also: Dare to Be Different: It's the Only Approach That Works