Underwriter Unplugged Episode 1: "Schools, Cities and Towns Oh My!"
I've spent the better part of the last 30 years working for insurance companies. During this time I've seen the good the industry can do even though most people never see it and the bad when it can't get out of its own way. The majority of my experience has been in the financial trenches first as a front line underwriter and then as an executive overseeing the teams watching the numbers as health insurance rate proposals and renewals went out the door. Basically I'm a numbers guy. I know all the "ins and outs" and more than most people would ever want to know about what makes up your health insurance premiums and how and why they are calculated (I know, fun guy at a party). Over the years I've seen some crazy things. I remember in the 1990's when there was discussion in the IT department that they didn't think they needed to code four digits for premium as no family plan would ever hit $1,000 a month. Now, that number would be a dream for most employers or families paying that bill. There were also many times where I would see something internally and then see something outside of work, maybe on the local news, that contradicted what I knew. Or there was a solution to a groups problems that I knew would never make it to the groups desk even though it would save them millions of dollars as it wasn't in the incumbent brokers best interest. I was never able to say anything and I hated that. I could see solutions to problems in the community and couldn't be heard. Well now that I am running my own consulting business and truly independent I can open up about the solutions I see to some of our problems out there and hopefully provide some help. That gets me to the topic of Episode 1 of Underwriter Uplugged: "Schools, Cities and Towns Oh My!".
My inspirational tipping point for this entire blog really came last winter which if you remember was a rather miserable winter, even by Wisconsin standards. As the winter went on it seemed almost every night somebody came on the local news channel, WBAY or WLUK, and had a story about some local town or city like Oshkosh or Outagamie County that was forced into a budget crunch because they were running short of road salt and had to order more but the price had gone up by $4 a ton (WBAY 2019). What would they do? Would they have to cut somewhere else? These stories led into spring and the flooding we had and the local city pump houses failing in certain cities in and around Green Bay and they didn't have the money in the budget to fix them and streets and homes were continuing to flood. If only they had so many tens of thousands of dollars in their budget to solve this. Of course this led into early summer which is the season that most school districts renew their health insurance. That leads us into our annual health insurance increases and what will each of the local districts do? Will they cut benefits yet again? Will they go without pay increases? Will they have to cut spending on the art programs (notice it's always the arts programs, never something like football)? We need to stop this madness?!
There are solutions out there that can help fill some of these gaps but they are outside the box, revolutionary ideas that will change the way we do business. For example if you look at health insurance it ranks as either the second or third biggest budget item for almost any public or private organization. Yet what do we do with it? Well, we hire a consultant who every one to three years shops it and gets us some numbers to compile on a spreadsheet and generally the group takes the lowest rate with the path of least resistance. That's not getting it done?
There are solutions out there that can and will provide significant savings to these groups but they aren't being presented? Why? The reason is actually two-fold. First the current consultant has little incentive to change the way business is done as long as it is continuing to renew. He or she continues to get paid and takes the path of least resistance. Second, from the clients side there's an old saying "nobody ever got fired for hiring IBM". It's safe and predictable.
If you want change you have to embrace it. What if I told you I have five to ten ideas that could possibly save you money that you had not heard of before? Would you listen? What if I said I have one idea so great that it would actually improve the benefits for some of your employees, reduce your liabilities day one, provide costs savings year one and each and every year after. Would you listen?
What if I said I the best idea I have seen in my entire career is out there, available to you and you have not seen it? Would you want to?
You see not all of our budget gaps are solvable. I'm not saying they are, but it's frustrating to know there are solutions out there that can fix some of these real problems we are having and either you are not being presented these solutions or you have seen them and don't understand them because they were presented poorly.
If you want a chance to think outside the box and see some real savings and improve the benefits for your employees, contact me to find out more.