When my older daughter was perhaps three years old, I stopped behind a car at a red light in the Bay Area. From her car seat in the back, she called out, "Come on, bozo, move it."

Oops. Perhaps I kibitzed even more about other drivers than I thought — and I knew I did it a lot. Offering constructive advice to my fellow drivers is one of the many habits I inherited from my father. 

Fast forward to maybe 15 years ago, when I was spending lots of time on freeways driving her and her sister to soccer games and other events. I began fantasizing (out loud, no doubt) about having a camera in my windshield to track the many transgressions of the drivers around me — in particular, the idiots who wove in and out as they raced each other in traffic, as though we were all just in a video game. Wouldn't it be great to capture the video, including the license plates, and forward it to police?

I wanted a camera in the back, too, to catch those who tailgated, sometimes within a few feet, to try to bully me out of the left lane even though there was a car just ahead of me in my lane. (I assure you, I did not drive slowly in my Mercedes convertible.)

Well, based on two recent viral videos, I think it's time to declare victory. We can all have cameras in our windshields and get at least some coverage in the back, at minimal cost. 

Doing so would be a major step forward for insurers — reducing fraud, simplifying the adjudication of blame after an accident, and reducing accidents by even getting some of the idiots to stop tailgating.

There are already lots of dash cams available, but they can cost several hundred dollars, impeding adoption. I'm thinking we should all be able to just attach our smartphones to the dashboard, as Uber and Lyft drivers do, and have it record video through the windshield on a continuous loop. 

If you're in an accident, sensors in the phone would let it know, and the phone would preserve the recent video and continue recording until you tell it to stop. If you see something dangerous happening on the road in front of you, you could also tell Siri to save the latest stretch of video. You could get it to authorities later or, with some prep work from police and fire departments, even have your phone forward it right away, in an emergency.

Most smartphones these days have cameras both in front and in back, so the phone could also capture video (albeit somewhat obscured) of what's happening behind you. (As a bonus, you'd be able to settle those "He hit me first" fights your kids have.) 

Dashcam apps that run on smartphones are already available at pretty low cost. One in the Apple store costs about $12 to install, then charges about $10 a month.

But why wouldn't insurers subsidize the apps? Why not make them free? Think of the savings in terms of adjusters' time and legal fees if you have dash cam video of accidents. Think of the fraud that could be prevented if we get lots of dash cams on the road — an insurer wouldn't just benefit from the cameras of its insureds but from all the cameras out there, much as security cams at homes and businesses now provide footage of all sorts of incidents they weren't necessarily designed to document.

An attempt at insurance fraud led to the viral video that drew me back to my long-term belief in the power of ubiquitous cameras. (In addition to the dashcam fantasizing I've described, I wrote a book with Chunka Mui in 2013, "The New Killer Apps: How Large Companies Can Out-Innovate Start-Ups," that described the spread of cameras as one of six major drivers of innovation.)

The viral dashcam video shows Ashpia Natasha driving on a parkway in New York in mid-October, when a Honda Civic cuts in front of her and slams on the brakes. She reacts quickly enough that she stops without hitting the car. After a brief pause, the Civic goes into reverse and accelerates into her car, smashing into the front bumper. Four people get out of the Civic and walk around looking dazed, as though they've been badly injured. They ask for Natasha's insurance information and start taking pictures of the damage to both cars, then realize they're being recorded on a dashcam. 

A car that stopped behind her — as seen on footage from her rear dashcam — had turned its flashers on right before the accident, seemingly to keep other cars away. It pulls up beside the Civic, picks up one of the passengers and drives off. The Civic quickly follows.   

As of this writing, it isn't clear that those who staged the accident have tried to file an insurance claim, but police have the license plate numbers of the two cars that staged the accident and are investigating what is clearly an attempt at fraud. In the meantime, the video made it easy for Natasha's insurer to agree to cover the $8,300 of damage to her car.

The other dashcam video that caught my eye was taken recently by a driver who used it to prove to police that he hadn't driven near a cyclist, even though the irate cyclist berated him for minutes in a parking lot, called 911, and got the police to come, sirens blaring. 

The dashcam video itself is pretty mundane — but the footage did its job by greatly simplifying a he-said/he-said situation for law enforcement. 

The encounter really went viral because the 22-year-old driver used his phone to video the 73-year-old cyclist yelling at him, while staying remarkably calm, and because the encounter ended with a real twist: Not only did the driver not have to pay a fine, but the cyclist was given a criminal misdemeanor citation for creating a public disturbance and had to pony up $160. 

(I'm very pro-cyclist and desperately want drivers to be more careful. Back in the days when I cycled a lot, cars cut me off twice and caused collisions, one of which knocked me out briefly and the other of which could have led to much worse injuries, though I walked away unscathed. But this cyclist was being a first-class jerk. For those of you who, like me, enjoy the occasional bit of schadenfreude, here is the video of the cyclist realizing that he, not the young driver, will have to pay a fine.)

Having dashcams in some significant percentage of cars on the road, via smartphone apps, could help law enforcement in other ways, too. Think of how quickly an Amber Alert could find a car if police could ping dashcam apps and ask drivers if they'd agree to have their phones used to look for a certain license plate or car model of a certain color.

Now, there are a bazillion issues to work out. For one, would the math work for an insurance company that wanted to subsidize the use of smartphones as dashcams, especially given that the high-risk drivers they'd most want to equip are less likely than good drivers to welcome documentation of their actions. There are also plenty of technical issues related to positioning the camera in the car and getting good enough resolution. 

Maybe the thorniest issues would relate to privacy. Having cameras spreading has certainly caused problems. They can be used recklessly, as has happened with some retailers using faulty face recognition to try to spot repeat shoplifters. And tiny, ubiquitous cameras can even be used maliciously, as China has done while repressing the Uyghurs. 

The dashcams could also pose a distraction — and we don't need any more distracted driving. I keep my phone in my pocket when I drive and am not tempted to look at any text messages, but if my phone is in front of me on the dashboard...? We'd all have to be more disciplined about putting our phones on "Do Not Disturb" and blocking text messages while driving. 

Despite the inevitable transitional issues, I think that, in time, the benefits will very much outweigh the costs.

By the way, my daughters are grown up and are, um, counseling other drivers at least as much as I do.

I raised them right. My father would be proud.

Cheers,

Paul

The long-term care (LTC) insurance market is broken: Premiums are unaffordable for many, benefits are being pared back, and the number of policyholders has plummeted. Yet 70% of adults will require paid-for senior care services during their later years.

What can the insurance industry do? How can we widen coverage and ensure more Americans enter retirement with the financial protection they need?

See also: The Crisis in Long-Term Care

The Current State of LTC Insurance

There is no single cause of the decline in LTC insurance coverage. Demographic changes, inaccurate actuarial models. and ill-fitting regulation all played a role.

A large factor has been the continual increase in life expectancy over the last five decades, and those extra years usually require extensive – and costly – senior care. 

Actuarial models failed to fully account for the change with the policies that were being sold in the '80s and '90s. Later, books began to mature, and claims ramped up as policyholders aged into senior care, forcing carriers to aggressively increase renewal premiums across the board, often by as much as 40% in a single year.

But it wasn’t entirely the fault of poor actuarial models; regulation was also culpable. Many states modeled their regulations for long-term care insurance after those for health and life insurance, mandating minimum loss ratios. While this might work in theory, it failed to account for the unique nature of long-term care insurance, where policies take decades to mature. During the initial years, claims are infrequent, resulting in deceptively low loss ratios. However, a dramatic uptick in costs follows as policyholders age and the high price of senior care kicks in. Regulations failed to provide the necessary flexibility to anticipate and account for that surge in future claims, leaving insurers unable to properly price policies over time.

The result has been a market where dozens of carriers have exited, and the few that remain price policies at premiums that are unaffordable for many Americans.  

Product Innovations in LTC Insurance

Thankfully, we’re beginning to see some product innovation within the LTC market, which is opening up access once again. Hybrid life/LTC policies have been growing in popularity. They can often provide better value than two separate policies. 

They can also offer greater perceived value to policyholders, given that hybrid policies often provide for partial return of premium. Legacy standalone LTC policies were usually offered on a use-it-or-lose-it benefit basis, meaning that the purchaser might never see a penny of the premiums they spent decades paying. 

Carriers are also offering greater flexibility when it comes to payment windows. Following the conventional wisdom of waiting until you’re around 55 years of age to get LTC insurance often means that premiums are out of reach. Carriers are responding by extending payment windows, with many now offering windows up to age 100, with premiums designed to be affordable relative to typical retirement incomes.

See also: The Future of Caregiving

Consumer Education and Engagement

The average consumer is unfortunately very ill-informed. A worryingly high percentage believe that Medicaid will pick up the tab for their senior care costs. It won’t. Others, meanwhile, are under the impression that their health insurance will provide cover for the care they’ll need. Again, it doesn’t. And to top it off, most Americans are severely underestimating the typical cost of senior care.

Awareness drives action, and as an industry, the insurance world, from brokers to agents, needs to do a better job at educating their clients about their likely care needs in later life, the cost of this, and the coverage available. One of the quickest wins here would be to challenge the conventional wisdom that consumers should wait until their mid-50s to take out LTC cover. Introducing the idea of LTC coverage to people in their 30s and 40s should become the new normal, as this will drive down annual premiums and open up access.  

New Distribution Strategies

Lastly, there has been a quiet evolution in employer-sponsored LTC insurance programs. There is a misconception that LTC insurance is no longer offered by employers. “True group” LTC plans are generally no longer offered, but these have been replaced by individual plans, also known as “multi-life” LTC.

These plans arguably offer a win-win for consumers and insurers. Individual policies allow for more effective underwriting and pricing among carriers, while offering more flexibility and policy benefits to policyholders.

The LTC insurance market is starting to self correct, after decades of declining sales and big losses. Continued innovation and a more informed public will help to ensure more Americans have the coverage they need for their golden years. 

For a working parent in the U.S. to leverage time away from work to welcome a child, the key has typically been whether they are fortunate enough to have a short-term disability plan or paid leave policy through their employer, or a state disability benefit. 

Fortunately, times are changing. Paid family leave policies have been enacted across several states (nearly two dozen), with more following suit. Employers are also stepping up, with 75% now offering paid parental leave, according to a recent survey by Mercer. Bonding time for adoptive and foster parents is also gaining momentum as employers strive to offer more comprehensive benefits.

However, for working parents, understanding what leave benefits they qualify for, and how various benefits work together, can be very confusing. Supporting employees is also a complicated task for employers and leave administrators. HR teams and managers are spending more time than ever learning about the evolving state leave benefits to support employees.

Meanwhile, the modern employee has come to expect a self-service approach to their benefits. As in other areas of our lives, being able to access parental leave benefits information on-demand from anywhere is not just the future, but what’s possible today. Embracing technology as a means to deliver a streamlined parental leave planning experience is vital to reducing complexity and easing the burden for all stakeholders.

See also: The Staffing Crisis in Insurance

Paid Family Leave “Baby Boom”

The growth in available state paid family leave benefits has been significant in the past two years. As of August 2024, there are now 22 states plus the District of Columbia that offer either mandatory or voluntary paid family leave benefits. States implementing paid leave policies have increased working mothers’ likelihood to return to and stay at work. According to research from American University’s Department of Economics, in the first year of access to state paid family leave benefits there was a 20% decrease in working mothers leaving their jobs post-birth, and a 50% decrease after five years. 

In addition to state paid leave laws, more employers are adding paid leave benefits to respond to working parents’ needs and to attract and retain valuable employees. According to WTW’s 2023 Leave, Disability and Time-Off Trends Survey, 73% of employers were changing or planned to change their leave benefits, with most doing so to improve the employee experience. Many employers report adding different types of paid leave benefits to support their employees, and access continues to expand as additional states implement new leave laws or voluntary programs. 

With this growth in state and municipal paid family leave offerings comes added complexity around managing parental leave benefits. More than one in five Americans will be working remotely by next year, which means HR teams need to quickly learn about state and municipal benefits that may not have been a factor in the past. Managing and leveraging parental leave benefits is a greater challenge than ever before, and one that can be addressed with technology-driven solutions in the market today.

Streamlining the Parental Leave Journey

Employers and leave administrators are turning to systems that facilitate education and better support the planning journey. 

For working parents to feel confident planning their leave, they need to understand how the latest federal, state, and municipal leave benefits apply to them. Employees attempting to find the information themselves spend countless hours searching for answers. In fact, only 26% of U.S. workers are very confident that they know how various leave types work together, according to The Hartford’s 2024 Future of Benefits report. 

For employers, technologies that can leverage advanced algorithms to model benefits information are a game changer. Being able to access up-to-date information on the evolving landscape of parental leave benefits not only reduces the administrative burden on HR teams and leave administrators, it better supports working parents. It also helps educate parents on available benefits and how they interact with each other.

In addition, the opportunity to provide a self-service leave tool is critical to employee retention and satisfaction. Empowering employees with the latest planning tools can be a strong differentiator in today’s modern workforce. Those who are investing in technology that supports employees’ wellbeing are the employers that will stand apart. 

See also: New Workers' Comp Laws for 2024

Demystifying the Parental Leave Journey

Today’s workplace is evolving, and so are the systems required to facilitate efficient processes for employees and employers alike. With additional paid leave laws being enacted and benefit choices for parental leave expanding, technology can help all stakeholders keep pace. 

Enhancing the parental leave planning experience through innovative technology solutions can ease the burden around education and access. Doing so is an investment in the future of the workforce, ultimately making it a more equitable experience for all working parents.

Business failure is more common than many realize. According to 2024 data from the U.S. Bureau of Labor Statistics, 20% of businesses fail within their first year. By year five, 49% have failed, and by year 10, 65% are out of business. Businesses fail to consistently attract and retain customers.

Acquiring and keeping customers becomes even more challenging during uncertain times. But there are opportunities for growth, if you think strategically. 

After four decades of running my own business, I’ve developed a set of tips to help strengthen client acquisition and retention efforts–-even in difficult circumstances.

1. Technology Adoption 

Are you using the latest technology to understand your customers? If not, you’re already behind. Technology is at the heart of client acquisition, providing the tools to dig deeper into customer behavior and create meaningful interactions.

Advanced Analytics and AI: Advanced data analytics provides deeper insights into customers' behavior. Predictive analytics pinpoint trends and customer preferences, enabling more precise marketing campaigns. AI-driven technologies–chatbots or virtual assistants–can automate customer interactions, delivering instant responses and personalized experiences. These tools also anticipate customer needs, resulting in higher engagement and satisfaction.

Personalized Customer Relations: McKinsey reported that personalization is more important than ever: “Seventy-one percent of consumers now expect personalized interactions, and 76 percent feel frustrated when they don’t” get them. AI can analyze customer data to craft customized offers, content, and targeted advertising. strengthening relationships and improving retention.

See also: The Power of Lifecycle Marketing

2. Identifying and Owning Your Niche Market

In unpredictable markets, specialists win. By targeting a niche, you deliver more than just a product—you’re offering expertise. It's tough for generalists to match the trust and loyalty that experts in a specific field can build.

Finding Your Niche: What market segments are being overlooked in your industry? Underserved markets may be smaller, but they allow your business to stand out more easily. As demand grows, your focus on these areas will set you apart from competitors that are still targeting more crowded spaces.

Positioning as a Specialist: By operating in a niche, you establish yourself as a specialist. Expertise and tailored solutions attract clients who are looking for specific services, while you are building a strong reputation. For example, businesses committed to sustainability are more likely to choose companies specializing in sustainable packaging solutions.

Niche Market Community: You can engage your audience meaningfully by hosting forums, creating targeted content, and offering events that speak directly to your niche’s needs. This fosters a sense of belonging, and strengthens customer loyalty.

3. Transparency That Builds Trust 

In challenging markets, trust is essential. However, many businesses struggle with open communication. Transparency about business practices and changes builds trust, strengthens loyalty, and boosts retention, even in uncertain markets.

Open Communication: Be upfront about pricing changes or business challenges. If you need to raise prices or change your offerings, communicate why and show respect for your client.

Transparency: Share both successes and failures with your clients. Being open about the issues that you face and how you plan to overcome them improves your credibility.

Loyalty: Build loyalty through that transparency. NielsenIQ found that 72% of consumers believe transparency is crucial. 

4. Staying Agile in Your Offerings

What succeeded last year may not be effective today. In an unpredictable market, adaptability is crucial. Businesses that modify their offerings to meet evolving demands are the ones that succeed.

Adapting to Changing Needs: It's important to keep your product or service aligned with changing market demands. As customer needs evolve, adjusting your offerings ensures your business stays relevant. For example, the recent rise of remote work requires new remote-friendly digital tools, while in P&C insurance there’s a growing demand for personalized coverage options. Adapting to these types of changes in the market is essential for staying competitive.

Listening to Your Customers: Seek and incorporate customer feedback into your offerings. Surveys, social media, and direct client interactions will provide valuable insights. Use them to refine your offerings to better suit customers' needs.

Staying Ahead of Trends: Monitoring trends and emerging technologies can give you a competitive edge. This may involve being the first to adopt new technology or to capitalize on emerging needs in the marketplace.

See also: Customer Segmentation Is Key

5. Forming Strategic Partnerships to Expand Reach

No business thrives alone—especially in tough times. Forming strategic partnerships opens doors to additional resources, markets, and opportunities. A well-chosen partnership can enhance your influence and boost your efforts to attract new clients.

Collaboration for Mutual Benefit: Align with partners whose goals complement yours and allow you to provide more comprehensive solutions. For example, a provider of eco-conscious goods could partner with a logistics company that focuses on using sustainable transportation methods to offer a fully eco-friendly solution. 

Leveraging Shared Resources: A strategic partnership brings access to additional resources—whether it’s new marketing channels, advanced technology, or specialized skills. By combining strengths, you not only enhance the partnership but also deliver greater value to your clients.

Boosting Credibility and Reach: Partnerships can enhance your brand’s credibility and unlock opportunities. Collaborating with a well-respected company can instantly boost your reputation and open doors to clients that may have previously overlooked your services. 

Conclusion

Economic turbulence brings significant challenges to acquiring and retaining clients, but it also creates opportunities for innovation and growth. By embracing advanced technology, focusing on niche markets, fostering transparency, and building strategic partnerships, companies can not only survive but thrive during difficult times. These strategies lead to stronger relationships, deeper loyalty, and sustainable growth–-even in the face of uncertainty.

As carriers seek better ways to support their agencies and nurture loyalty amid market changes, heightened customer expectations  and a flood of AI-enabled possibilities, they can no longer rely on outdated approaches to manage distribution. Next-generation distribution management can play a pivotal role in fostering growth, delivering exceptional agent experiences, and perhaps most fundamentally, advancing the agency into its next evolutionary stage. 

The needs of the modern insurance agency go beyond basic functions like managing producer relationships and tracking commissions. To thrive, agencies must be in the vanguard of agile, data-driven systems that can seamlessly support a fast-moving business environment.

Why Traditional Approaches Fall Short

Traditional approaches to agency management systems now often fall short. Legacy agency management systems lack the flexibility to keep up with shifting business requirements, regulatory changes, and the rapid pace of technological advancements. 

This rigidity makes it difficult for insurers to respond swiftly to market changes. Additionally, reliance on manual processes and static data slows decision-making, depriving insurers of real-time insights and predictive analytics that are crucial for identifying trends, optimizing sales strategies, and maximizing returns on investment from their distribution networks. 

Another significant issue is the disconnect between insurers and their distribution partners; traditional systems often fail to foster direct engagement. This lack of collaboration can lead to inefficiencies and missed opportunities, as insurers struggle to fully understand the needs and performance of their producers, hindering stronger relationships and improved business outcomes.

See also: Distribution Management: A Path to Maturity

The New Standard for Distribution Management

To overcome the limitations of traditional systems, insurance agencies should shift toward adopting distribution management platforms that emphasize agility, collaboration, and data-driven decision-making. 

Modern agencies need systems that harness the power of collective knowledge. By leveraging AI and machine learning, agencies can analyze vast datasets, drawing on the collective experience of thousands of agents. This wealth of insights enables agents to make informed decisions about which leads to pursue, and which strategies yield the best results. It transforms individual agents into informed decision-makers who can optimize performance and tailor their approaches to meet both producer and customer needs in real time.

Equally important is real-time visibility into producer activity. By tracking and managing producer performance with precision, insurers can identify trends, measure productivity, and make timely adjustments that drive success. This transparency empowers agencies to address challenges proactively, refine strategies, and seize emerging opportunities, giving them a competitive edge.

To further support their producers, agencies should provide producer-centric tools that offer in-the-moment guidance and personalized support, rather than relying on static training materials. These intuitive, flexible resources enhance productivity, strengthen engagement, and foster collaboration, ultimately improving business outcomes by building stronger relationships with carriers.

Finally, agility and scalability are essential in an industry constantly shaped by rapid change. Agencies need cloud-based platforms that are flexible, scalable, and capable of seamless integration to adapt quickly to regulatory shifts, scale operations efficiently, and respond to evolving customer demands. This ability to evolve with the market is key to remaining competitive in today’s insurance landscape.

See also: Digitization and Enablement of Agents

Elevating Distribution in the Modern Era

The demands of both the market and customers are changing faster than ever, so the insurance industry needs to respond in kind. Shifting the fundamentals of distribution management into a higher gear helps because it goes beyond simply tracking commissions and ensuring compliance. By plugging into these new capabilities, agencies will be empowered to foster stronger relationships, innovate with confidence, and capitalize on emerging opportunities. By embracing a modern, data-driven approach to distribution management, insurance agencies can maintain a competitive edge and continue to enjoy growth in today’s ever-evolving landscape.

American Water, the largest regulated water utility company in the U.S.., was shut down recently following a cyber attack. The shutdown followed similarly high-profile attacks, including one across the Atlantic on the body that runs transport in the U.K. capital, Transport for London. Attacks like these can cost a fortune, to say nothing of the havoc they can cause to ordinary people. And they’re becoming more frequent and more serious all the time.

The most recent AXA Future Risk Report named cybersecurity risks third (after climate change and geopolitical instability) among the greatest current challenges worldwide. There were 2,365 cyberattacks in 2023, with 343,338,964 victims. Data breaches were 72% above 2021, which had held the record. Data breaches cost $4.9 million on average in 2024. More More than 90% of organizations have reported email security incidents. And compromised business email accounts accounted for over $2.9 billion in losses in 2023. The numbers show the scale of the challenge.

See also: The Evolving Landscape of Cyber Risk and Insurance

Clearly, therefore, we need a new approach. The traditional one relies heavily on a perimeter-based defense strategy, often referred to as the "castle-and-moat" approach. This emphasizes building strong defenses around the perimeter of a network to stop unauthorized access. But there’s a problem here: The approach assumes that threats are mostly outside the system in question, and that internal systems and users are secure and can be trusted. It doesn’t account for possible insider threats, stolen details, or malicious actors able to get beyond the "castle and moat" via phishing or other methods. 

In fact, 95% of successful cyberattacks are believed to take place because of errors or weaknesses caused by people, rather than technical problems in the system. Traditional security measures also depend too frequently on recognizing known threats and applying fixed rules to detect and stop attacks. This may have worked in the past, but it needs to evolve.

What might a new approach look like? There are at least three main aspects. education, risk assessment, and risk prevention. 

First, education. The best defense against a cyberattack on an organization is a workforce that consists of people who can recognize risks, understand them, and respond to them in the right way – and to do that on a continuing basis, as risks morph. This "human firewall" is a powerful form of defense against bad actors. To develop one, organizations must invest in high-level education and training, recruiting, where possible, government agents, former hackers, and others who understand cyber-risk from the other side. 

Second, risk assessment. It’s hard to solve a problem when you don’t know what the problem is. There are now tools that use cutting-edge technology to score organizations according to how vulnerable they are to cyberattack. That score can be broken down into different areas of potential vulnerability, giving organizations a way to gauge their exposure quickly and know where they should invest their time, money, and other resources to limit the likelihood of a costly breach. Cybersecurity companies are developing the means to provide an increasingly vivid picture of organizations from the standpoint of their robustness to cyberattacks. Now and for the foreseeable future, organizations should assess their vulnerability continually.

Connected to that discipline is the third: risk prevention. Once you know where your vulnerabilities are, you can take bold action. There has been enormous innovation in cybersecurity in recent years, and it would be remiss of any company not to take advantage. The difficulty is that there are so many companies selling services it’s hard to know which ones to buy; this is why it’s worth seeking out experts and partners to guide you.

See also: A New Focus for Cyber Criminals

Cybersecurity companies are engaged in an arms race with their "black hat" counterparts. There will always be those who use their undoubted talents for nefarious ends, and as cybersecurity gets better, cyberattacks will inevitably become cleverer. From the standpoint of an organization, the key, then, is not to put some measures in place and then forget about them. Organizations must be constantly vigilant and take a continuous-improvement approach to cybersecurity if they’re going to anticipate and remain robust against mutating cyberthreats. That means investing in education and training, in tools to evaluate vulnerabilities, and in the software that makes those weaknesses into strengths.

For individuals and for organizations, suffering a cyberattack can be stressful and costly. The fact that cyberattacks are largely invisible can elicit a sense of powerlessness, and even when the cyberattack is dealt with, there can be a lingering fear that something is still in the system, working its way through sensitive files and folders, perhaps stealing personal data from your clients or customers. The damage, in other words, can be emotional and reputational, as well as financial. 

But organizations are not at the mercy of cyber-criminals. Companies around the world have developed truly cutting-edge software solutions, tools, and forms of technology to help make the digital information infrastructure of companies all but impregnable. Taken together, they represent a whole new approach to cybersecurity – one fit for our age.

In sports, there are no guarantees. It’s a good thing, then, that there are insurance policies that players, teams, venues, and leagues can rely on to help mitigate risk on and off the field, all while the players work hard for a win. 

Sports insurance includes everything from players’ health and accident protection to general liability and workers' compensation. Professional sports tend to get most of the headlines, and sure, there are insurance policies specifically for them, but from an insurance professionals’ perspective, the majority of insurance policies are written for schools, universities, and amateur leagues. 

Even so, if there is risk, or money, involved, there is likely to be an insurance policy available to protect from that risk — if someone is willing to pay for it. 

College Coverage

Colleges within the National Collegiate Athletics Association have long protected their athletes from on-field injures. If someone is hurt while playing for their college team, they could be assured that their treatment and rehab would be provided by their school. 

But once they graduated, that wasn’t always the case — until this year. 

Beginning in August 2024, the NCAA is now mandating that schools give their athletes medical coverage that will extend two years after the athlete completes their eligibility – either through graduation or some other separation from the sport. 

That means that if an athlete graduates, only later to find some nagging injury has flared up, that athlete will now be covered — at least for two years. 

These policies have a $90,000 limit per injury, with no deductible. They also cover mental health services related to that injury for up to $25,000, though that will be counted as part of that $90,000 total. 

Obviously, this coverage is only for injuries sustained while participating in an NCAA sport or practice. That caveat worries some schools, though. It is going to be up to the schools to document injuries as they happen. And for programs with understaffed training programs, many schools worry that the new recordkeeping burden may be more than they can manage. 

See also: Navigating the Complexities of Venue Insurance

Professional Policies

Once sport hits the professional level, it becomes big business. And just like any business, sports teams and leagues have an army of insurance professionals helping take care of their numerous policies. 

From the club level, a professional sports team has similar policies to just about any other business, at least when it comes to the facilities and back-office employees – health, general liability, umbrella, business interruption, and workers' compensation, among others. 

When it comes to the players, the policies have some nuance. 

Typically, player insurance policies are covered by the leagues’ collective bargaining agreements. While each team carries separate health insurance plans for their back offices, every player in the league typically is covered by a single nationwide policy. This allows the players to keep their coverage if they are traded and are then forced to move their families across state lines. 

When it comes to individual sports, such as tennis or golf, the coverage is generally up to each individual athlete. Some players’ associations offer group coverages the individuals can buy into. 

Workers' compensation is particularly tricky when it comes to players, especially in high-impact sports. All professional athletes are covered by their state’s workers' compensation program while they are playing. The leagues are typically responsible for purchasing those plans. 

If an athlete is injured on the field, the plan will cover a portion of their salary, as well as treatment for their injuries. 

But the tricky part is that fewer and fewer workers' compensation plans are willing to write policies that include coverage for concussions or traumatic brain injuries. 

So far, each league has been able to find carriers to include brain injuries, but with the past billion-dollar settlement the NFL paid, as well as the inevitable flood of lawsuits to come, the key question is whether insurers will continue to indemnify teams when the policies are up for renewal. And if the teams and leagues end up being on the hook for the billions of dollars of liability, the viability of these leagues becomes a legitimate concern. Workers' compensation for contact sports could become a nightmare. 

Salary Safety

Beyond players' health and safety, there is another insurance policy that professional teams have been opting for more and more lately, and that is a disability policy that would refund the team if a player is no longer able to perform but their contract still says they are due a multimillion-dollar payout. 

Often things like signing bonuses or, in some leagues, the entire value of the contract must still be paid if the athlete is no longer physically able to play. That could be tens or even hundreds of millions of dollars for top athletes. 

On top of that, if the team is paying for a player who can no longer play, they are often still stuck with that money as a hit against their salary cap, meaning they can't hire anyone else to replace them. 

Enter insurance. 

Teams are increasingly buying disability policies to protect themselves in case their stars are injured on the field but the team still has to pay out. Some of those policies kick in the first game the star misses. Others have waiting periods – often eight games or so. 

In the NFL, the collective bargaining agreement sweetens those insurance policies, and if a team gets a refund on that salary, then they also get that salary cap space returned. 

The catch to these policies is that they have extremely high premiums, so they are only worthwhile in some situations. Other policies are rumored to have exclusions for things like traumatic brain injury, potentially limiting their usefulness. 

See also: Leadership Lessons From Sports

Amateur Coverage

Professional and college sports get most of the headlines, but for the typical insurance professional, it is the K-12 and amateur leagues that will drive most of the insurance business on a day-to-day basis. 

Schools typically purchase their player coverages through commissions or the school board. 

Youth and amateur leagues tend to buy coverage on behalf of the teams participating. In general, the field owner or municipality will require the league or individual teams to show proof of coverage before they can use the facility. 

These policies include general liability as well as participant liability and even inland marine policies to protect things like equipment. 

Increasingly, and especially in the wake of high-profile sexual abuse cases involving women and youth athletes, many municipalities are requiring hefty abuse liability policies. Some of the highest requirements right now are in California.  

Standard polices often cover abuse, but they generally have limits that are too low to accommodate the new wave of coverage requirements or to protect against the monstrous settlements, meaning stand-alone policies with higher limits and separate deductibles are needed. Those add-on policies typically require background checks and potentially other safeguards, such as clear policies and protocols to ensure the participants are safe. 

Steve Ballmer, the former CEO of Microsoft and one of the world's richest people, recently opened his $2 billion Intuit Dome, which will be the home of his Los Angeles Clippers NBA team. The arena is drawing rave reviews. 

The app that goes with it? Not so much. 

Ballmer appears to have fallen in love with his new arena so completely that he assumed customers would treasure it, too. He also seems to have let the coders run the show when it came to building the app, so "customer-centric" became "coder-centric."

So let's have a chuckle at the expense of a man who's worth, oh, $125 billion more than we are — then make sure we don't make the same, all-too-common mistakes that he did. 

How far off the mark is the Intuit Dome app? Here is how a guest columnist for the Washington Post described the experience of taking his son to a Billy Joel concert there:

"There was no way I would have downloaded the Intuit Dome app if I hadn’t received a bunch of scary emails with subject lines that started with a red exclamation point and said that no one would be allowed into the arena without it. And although I had purchased two tickets, one would have to be transferred to my 15-year-old son’s own Intuit Dome app. We had to show these tickets on the app to get in. I could not move these tickets to my Apple Wallet, use a screenshot or print them out.

"To use the Intuit Dome app, I had to surrender my address, email and phone number (none of which, unlike every other app I have used, it was able to autofill). If I wanted to buy anything at the Intuit Dome, I had to give the app my credit card information because neither cash nor Apple Pay would be accepted. The app strongly encouraged me to take a selfie for my “Game Face ID,” so it could use facial recognition. It wanted my license plate number for parking....

"It was a time investment that might make sense for someone who is going to the Intuit Dome very often. For instance, an L.A. Clippers player....

"The app brags about how its 'Zoom Thru' tech allows me to 'navigate Intuit Dome like a pro.' This is not my goal. My goal is not even to be an amateur. My goal was to eat popcorn and listen to Billy Joel."

You can see where Ballmer is coming from. He wants to design an entire experience befitting his team's expensive new home, and he's assuming he'll have lots of repeat customers who will happily adapt to the arena's rules, which ought to produce efficiencies in the long run. 

But that's not how customers think. As the columnist wrote, he and his son weren't looking for an Intuit Dome experience. The columnist wanted to buy tickets, get into the arena, and watch a concert. That's all.

The classic line about marketing is that "the consumer doesn't want a quarter-inch drill; the consumer wants a quarter-inch hole." But the Intuit Dome app focused on delivering a branded, quarter-inch drill — and, in the process, let the technology get decidedly unfriendly. 

The columnist wrote:

"In the week before the concert, the Intuit Dome app asked me to update it three times, which is weird because most apps do that automatically. Then, as I was finally entering the stadium, my app logged me out. An attendant came over and used an iPad to look me up, though she could not find our tickets....

"After five minutes of recovering passwords, the nice woman said I was close enough to solving the Intuit Dome app’s three riddles to be allowed inside."

I've known Ballmer for going on 40 years, since I covered IBM for the Wall Street Journal back in the days when the IBM-Microsoft relationship was core to the nascent personal computer industry. He's a seriously smart and disciplined fellow who will surely address all the problems with the Intuit Dome app. And quickly. A year from now, we'll all have forgotten we had this conversation.

But I hope these early problems will stick with you, because remembering them could head off problems. The temptation is so very strong in business to view the world from an internal perspective, not from the customer's, as hard as we may try. And I see insurance companies at least tempted to make that mistake when it comes to apps.

Just about all the major insurance companies have apps that they expect customers to use to make a payment, ask a question, or file a claim. I also see insurers talking about wanting to interact more often with customers. 

But a lot of customers don't want an Allstate or Geico or State Farm experience any more than they want an Intuit Dome experience. They just want to do their business with you and move on. They likely don't want to interact with you more often, unless you have something useful to tell them or to do for them. 

They want you to fit into their lives. They don't want to have to fit into yours.

Cheers,

Paul

P.S. A couple of Ballmer stories:

The first time I met him was in April 1987, for breakfast at the Plaza Hotel in New York. IBM was making an announcement that day that was designed to retake control of the PC operating system, and Microsoft wanted to get ahead of the announcement by briefing the major media. But Ballmer wasn't there. Not 10 minutes after the appointed time. Not 15. Not 20. I went ahead and ordered breakfast. Finally, 45 minutes late, a large man plops himself down in the seat opposite me, wearing a T-shirt and running shorts, covered in sweat, and with dirt and pebbles on the back of his shirt and underside of his forearms. He had gone out for a run in Central Park, and his back had gone out. He had spent the last hour and a half, mostly lying by the side of the road, eventually managing to get upright and hobble over to the fancy restaurant at the Plaza.

Talk about a dramatic entrance.

I got a bit of an inside look at how he operates when Bill Gates offered to open Microsoft's archives to me for a book I was doing on IBM's problems, "Big Blues: The Unmaking of IBM," published in 1993. I spent a week at Microsoft headquarters in Redmond, WA, where Ballmer set me up in a small conference room next to his office. Every morning at maybe 8, he'd come in with boxes of material and brief me both on what was in them and on the people he'd arranged for me to interview that day, to give me the Microsoft side of the early days of working with IBM. Every night at 7 or so, he'd come back and spend maybe an hour with me answering any questions that had come up. 

That was all extraordinarily helpful. Once I had so much detail from Microsoft, the IBM folks could either let that version stand unanswered or find a way to respond — and soon enough almost every IBM executive who had turned down my request for an interview for the book found a way to talk to me at length.

The revealing part came because my base of operations abutted Ballmer's office. He had insisted on having the smallest size of office available at Microsoft, even though he was the No. 2 executive, and he was like a caged animal in there. He sounded at times like he was literally bouncing off the walls. He bellowed so much, at least in those days, that he had to take voice lessons to learn how to be himself while not damaging his vocal cords. He was mostly enthusiastic but could also be extraordinarily loud when upset. I've never seen such range of emotion in an executive. 

Al Lewis wears two hats, both professionally and to hide his bald spot.   Hat #1: Validation of Outcomes. Al is the founder of the Validation Institute, the authority on measuring validity of health outcomes. His two books on outcomes measurement both topped the trade bestseller list, while one earned kudos as the best healthcare book of the year.  Hat #2: Employee Health Literacy. As “Quizmeister-in-Chief” of Quizzify, his mission is to teach employees to use healthcare services appropriately, using a Jeopardy-meets-Choosing Wisely-meets-Comedy Central format. Quizzify is authorized to display the Harvard Medical School shield. Examples: Extensive trivia quizzes about lifestyle/nutrition, and especially how to find the hidden sugars Customizable health benefits questions Gentle but effective dissuasion of use of weight loss drugs. A 28-question “Curb Their Enthusiasm” quiz is used for “self-preauthorization,” to cull out all but the most committed users, who should be the only ones you finance Slashing the cost of emergency visits and admissions by weaponizing EMTALA to protect you and your employees from hospital overcharges. Most of your ER bills will only have three digits in them if you follow his guidance He graduated Phi Beta Kappa with honors from Harvard, where he taught economics, as well. He also graduated from Harvard Law School, albeit with no honors that time -- other than winning their annual trivia contest, of course.

Paul Carroll

Health insurance has always driven me nuts. It just doesn't work the way it's supposed to work. The idea was that you would have these massive forces pitted against each other, but they've all been co-opted. Pharmacy benefit managers (PBMs) were going to be middlemen, saving everybody money, but now they’re champs at collecting hidden fees. Health insurers were supposed to push back against unnecessary medical procedures, but they've learned that they're really just sort of a cost-plus operation, so they're in no great hurry to push prices down. 

All that said, I’ve always been intrigued by Quizzify, because you take a very different tack toward health. You go bottom up, rather than top down. Employers hire you because you say, Let's make the consumer smarter, because there are a lot of things that will not only make them healthier but also take cost out of the system. 

That's more of a preamble than I intended. I’d be interested in your historical perspective on health insurance and the enormous costs of our healthcare system in the U.S.

Al Lewis

You're spot on. Historically, all these great innovations like HMOs, PPOs, wellness, PBMs, and now even value-based care were supposed to solve our problems. But they’re classic examples of the observation that every cause starts out as a movement, becomes a business, and degenerates into a racket.

A main reason our costs are so high is there’s no economic disincentive for employees to push back on those rackets, because they pay only a small fraction of the bills. Most companies just give every full-time employee a benefit and say, It’s yours to spend. There’s nothing else in business where every employee gets an unlimited budget and no training in how to spend it.

Some companies that self-insure explain to employees that when they spend money, it drives up costs for everyone. I say, No, no, no, that doesn’t work. 

It’s just the opposite. You have to show people that it’s in their very own best interest not to demand or agree to many drugs, tests, and procedures – not because it's going to cost the company money but rather because too much healthcare can often be bad for their health. And that's exactly what we teach: Just because it’s healthcare doesn’t mean it’s good for you.

Paul Carroll

You and I have been talking for a long time about the wild claims wellness vendors have made about how they can save money for employers. I remember a piece you wrote years ago about a vendor’s claim that by screening 1,000 people it could prevent a heart attack. You calculated that the screening and preventing that one heart attack would cost $1 million and that 90 or 99 people would get unnecessary, possibly harmful treatment because of false positives from the screening.

Al Lewis

The false positives will always get you. Vendors didn’t have a clue about false positive math. Or regression to the mean or participation and survivor bias. Or maybe they did know all that and weren’t telling their customers.

Paul Carroll

Overuse is a point you make nicely in your description of Quizzify’s origin. Tell us a bit more about how it works today.

Al Lewis

If you educate people on their healthcare by asking them an entire year’s worth of trivia questions where the answer is always pointing you toward using less healthcare because you’re using too much, you're going to lose your audience. People are going to say: “Oh, they're just trying to save money on insurance.” So we have multiple topics in our monthly quizzes – questions on nutrition, mental health, gut health, health benefits. Even everyday health, like: “Is it safe to dip a chip after someone double-dips?” Makes the whole quiz fun and not a Debbie Downer. 

Our most popular topic is nutrition because it’s not just useful but also is a lot of fun. We mock companies, and we name names. We don't do this like the wellness industry does and just tell you to avoid added sugars. No, we actually show ingredient labels and ask: “Here is a bottle of Naked Juice that says in bold letters it has no added sugar. How much added sugar does it actually have?” The multiple choice answer is 53 grams. That's the level of specificity we get to, and people eat that stuff up. No pun intended.

Paul Carroll

Where do you most move the needle in terms of savings on healthcare costs?

Al Lewis

We don’t save a nickel on nutrition, and we don’t lie to employers to say we do.

Where we save the money is in the stuff that happens right away. You’re familiar with what we teach people about dental care. The savings are huge, because it turns out that most cavities don’t need to be filled, but something like 120 million are nonetheless filled every year in the U.S. It's the number one clinical procedure, by far. Instead, all the dentist needs to do in most cases is coat the cavity with silver diamine fluoride, like mine did after I asked for it, but we teach that you have to ask. Took two minutes, totally painless, and cost $40. So you save maybe $120 by not filling the cavity. Do the math: $120 times 120 million is more than $14 billion a year. 

If your dentist says they've never heard of the treatment, they're lying. They just don’t proffer it because it’s an existential threat to their finances.

We save a lot on scans, too. Our trivia questions teach that a CAT scan emits 100 times the radiation of an X-ray, and suddenly employees stop demanding inappropriate ones. Americans do twice as many scans as people in other countries, and with nothing to show for it. Just cutting back on the number that get demanded gives you about a 20% savings on that coverage right away.

That doesn’t include the savings from gentle pushback on scans doctors propose. My very own doctor suggested a CAT scan to me the other day as a follow-up to an ultrasound, but I asked the classic question that Quizzify teaches employees to ask: “Would the result change the treatment plan?” She acknowledged that it wouldn’t, so we didn’t do the CAT scan. 

Without Quizzify, nine people out of 10 would have had the scan done on the doctor’s say-so.

The best example of all is the weight loss drugs, where we have this 27-question intro quiz called, “Before Your Journey.” It's very simple. You require people to take the quiz, probably as part of your wellness incentive program. The PBMs get very upset and threaten your rebates if you try to do conventional preauthorization on your own, but they can’t stop you from educating your own employees in your own wellness program.

This is not preauthorization. It’s employee education.  Employees just take the quiz. If they still want the drugs after learning about Ozempic Face (with a great, wrinkly, before-and-after picture) or the fourfold increase in your chance of impotence, or 25 other things, we support them with a year-long curriculum to help manage digestive side effects and then teach them all the tricks that the food industry uses to addict them to sugar. 

But about 80% of the people who start the initial quiz do not continue to the drugs, once they understand more about the downsides. These are mostly people who would have dropped out after a certain number of months anyway after wasting a ton of your money, so everybody wins except Novo, Lilly, and the big PBMs.

Paul Carroll

You also have an emergency room consent form that I know is quite popular.

Al Lewis

We do a lot with ERs. We show people pictures of two free-standing centers. One is urgent care, and one is an ER. We help people understand which is which, and which will charge far more than the other.

As for the consent form, a federal law says patients can propose whatever price they want to propose in an ER. The ER can reject your offer, but they still have to treat you the same as everyone else if they do. Quizzify’s Consent says the patient agrees to pay twice what Medicare would pay for the visit, and Medicare doesn’t pay much, so two times Medicare is usually under $1,000.

In fact, we’re going through this personally right now. My wife had an ER visit. We didn’t sign their consent form and gave them the Quizzify Consent instead. They accepted it, but then we got a bill that was as if they never saw what we wrote down, plus they upcoded a test to rule out Lyme Disease; they coded the test as a Level 4, a code that is reserved for moderately severe issues. The difference in cost is mind-blowing. But we have irrefutable documentation of our consent and that we are a Level 2 or 3, so we sued In small claims court, and I’m sure the bill will get knocked way down. I always win these things.

When you use Quizzify’s Consent, your charge for an X-ray will be maybe $60. You’ll pay $18 for crutches, not 10 times that. I have the actual invoices for those charges from a case in Pittsburgh. If anyone wants to write to me, I’ll send ‘em.

Paul Carroll

Every little bit helps, and some of these issues you’re tackling aren’t exactly little. 

Thanks, Al.

A 2023 study by the American Property Casualty Insurance Association (APCIA) reveals that the insurance industry saw a net underwriting loss of $26.9 billion in 2022, the largest underwriting loss since 2011. More recently, AM Best’s First Look Report shows that the U.S. property/casualty (P&C) industry recorded a net underwriting loss of $21.2 billion in 2023. That’s a slight improvement over the previous year, but it's concerning, nonetheless.

In an industry that is all about risk, this level of loss is alarming, especially when global trends beyond our control drive it. Inflation, climate change-fueled natural disasters, state regulations, and other factors are all to blame. There’s not much the insurance industry can do to curb inflation or the ravages of climate change. However, we can take a good, hard look at the things we can control. Reigning in costs around operations, claims management, and focusing on growth are all examples of things we can and should improve to keep costs down. By investing in technology to identify and solve operational challenges, carriers can be more profitable and create more value for their customers. 

Identifying Operational Bottlenecks

Mid-sized insurance carriers face various challenges that can lead to financial losses. Understanding these areas can help them take proactive measures to mitigate risks. Common ways mid-sized carriers might be losing money include inefficient claims management, labor-intensive processes, and legacy technology that fails to provide a solid customer experience. Modern technology can do more of the heavy lifting to streamline operations and reduce costs.

Mid-sized insurance carriers must actively address these potential areas of loss by adopting technology, improving risk management practices, and ensuring that operational costs are under control. 

So, where should they start?

Making Strategic Tech Investments

Let’s approach this in terms of emergency room triage. The first step is always to stop the bleeding. Where are the worst injuries that need your immediate attention? Mid-sized insurance carriers can leverage technology to streamline costs in these critical areas. 

1. Automation of Routine Processes. Are your agents still using outdated tools like spreadsheets or re-keying customer information more than once? That’s a problem that’s costing you money. Implementing automated claims processing reduces the time and labor involved in assessing and paying out claims. By investing in AI and machine learning, carriers can improve claims evaluation, detect potential fraud, reduce human error, and make more informed decisions with minimal human intervention.
2. Customer Self-Service Portals. Offering secure online customer portals where insureds can manage their policies, obtain insurance coverage cards, verify information, file claims, and make payments reduces the need for customer service staff and enhances customer satisfaction. Our research shows that customers who engage repeatedly with their insurers’ portal have a 25% higher retention rate.
3. Data Analytics and Predictive Modeling. When it comes to risk assessment, leveraging big data and predictive analytics helps carriers better assess risks, leading to more accurate pricing and reduced loss ratios. In addition, the ability to analyze customer data can help identify patterns and trends that inform more targeted marketing and sales efforts, reducing customer acquisition costs. Analytics can help carriers leverage customer data to identify payment trends, user engagement, and the ability to track customer journeys and identify areas for improvement. It can even help carriers explore new revenue streams by dynamically offering customers new risk products based on their individual needs and preferences. 
4. SMS/Text Messaging. Outbound messaging plays a pivotal role in customer retention and premium renewal collections. Our research shows that 26% of customers whose policies were on the verge of lapsing promptly paid their premiums after receiving a single SMS alert notifying them of the impending policy cancellation. Furthermore, sending a cancellation message via SMS on the renewal day slashed cancellations by 52%.
5. Chatbots. Implementing AI-powered chatbots to handle simple customer inquiries can decrease the volume of calls and emails, freeing up human resources for more complex issues. Customers used to avoid chatbots at all costs. However, improvements in AI have changed that. Research shows that Millennials prefer to engage with chatbots first for basic assistance. 

By adopting these technologies, mid-sized insurance carriers can significantly reduce operational costs, improve efficiency, and stay competitive in an increasingly digital marketplace. 

To stay competitive, carriers need to focus on new customer acquisition and retaining existing customers while finding ways to keep operational costs under control. The good news is that technology solutions are available today that can solve many of these challenges at a reasonable price. It comes down to leveraging technology to demonstrate to your customers that you anticipate their needs. This is crucial for winning new business and building loyalty with the customers you already have. 

Sponsored by: ITL Partner: insured.io