Moving

My wife and I are in the midst of a hectic season.  For the first time in 20 years, we’re moving.  The timing and circumstances have aligned to create this season of de-cluttering, massive garage sales, real estate transactions, and in just a few weeks – moving into a new home.  Our three daughters have left the nest, and we have too much house for two people and two very confused dogs.   This move will split the difference on work commutes  for my wife and me, and will put us within 10 minutes of our first grandchild, expected to arrive in September.

So how is this related to a blog on risk management and insurance?  Amidst all of the hectic activity surrounding this transition, risk and insurance plays a significant role.  Today, we are dispensing with 20 years of accumulated and no longer needed property by having a moving sale out of our garage.  The risk manager in me cannot help but look at the crowds of bargain seekers in my driveway and garage with trepidation that someone might injure themselves on my property.  I find myself moving certain items to create clear paths and eliminate potential trip and fall hazards – my wife thinks I’m a paranoid nut.  I calmly explain that as a former underwriter and risk manager, I see the worst case scenario in everything. I can’t help myself.

I am also in conversation with moving companies to help us get our remaining property from point A to point B without destroying my back.  Part of that conversation includes insurance on our property while in transit.  Of course, the moving companies offer to sell us varying levels and amounts of coverage.  Actually, our existing homeowners insurance policy provides some coverage for our property in transit, even while it is in the care, custody, and control of a moving firm.  However, we will likely temporarily add some of our more valuable items to our scheduled property endorsement that broadens the coverage and eliminates the deductible should tragedy befall those items during the move.

The point of this post is to illustrate that no matter what you do in life, there are risks involved and there are usually insurance protections available to insulate you from the financial consequences of those risks.  Unfortunately, many people (outside of the industry insiders) operate on many false assumptions and learn the hard way when things go wrong.  They say that ignorance is bliss – but it can also be very costly.

Now, back to the garage sale before my wife gives away my 1970s classic rock collection.

Developing New Insurance Talent

A few weeks ago I wrote about and highlighted MIFuture.org and its efforts to develop young insurance talent for the Michigan (and beyond) insurance industry.  Now I would like to highlight another organization that has a nationwide reach and a plethora of resources for both students and educators.  INVEST has a forty-year history of advancing the education and development of talent for the insurance industry.

I strive to convince young people that the risk management and insurance industry is a viable career option that is not as staid and boring as some think it is.  In fact, it is one of the most stable industries going, and offers a wide variety of career options.  The stability of the industry is illustrated by my first employer straight out of college many years ago: I worked for CIGNA Property & Casualty which at that time included a subsidiary known as the Insurance Company of North America, which happens to be the oldest U.S. stock insurance company tracing its founding back to 1792.  Insurance is an industry that is here to stay and its employment opportunities are not as susceptible to the economic winds as are many other industries.

With that in mind, young students who care to explore the industry should peruse a few of INVEST’s resources that are specifically geared towards those interested in learning more.  I highly recommend INVEST’s LearnInsurance.org website.  Students can explore the different insurance career options and find where their interests may best fit.  They may also learn some insurance fundamentals and find scholarship opportunities.

For those already in the industry, or in education positions devoted to teaching insurance content, the INVEST website offers many great resources as well.  I encourage you to check it out, and support this organization.

Airlines and Risk

In less than an hour, I am off to the airport to pickup my daughter who is flying in for a visit from Wyoming where she attends college.  Since I was a young boy, I have been fascinated by airplanes and the entire notion of air travel.  At times, I considered a career as a pilot or perhaps some other management capacity within the industry.  Today, all of this has me thinking about the risks that are inherent in the airline business.

Being late to pickup my daughter is not an option, so this will be a brief, top-of-consciousness type of blog post.  As always, I welcome your comments to continue the conversation.

No one who lived through the horrors of the 9/11 attacks back in 2001 will ever forget the images of that day.  Airplanes used as weapons of mass destruction, with no regard for the lives on board or within the targets.  Aside from large public venues that attract crowds of people, there are few items of property with such significant risk for terrorism-related losses than commercial airplanes.  And yet, this is just one of many risks faced by the airline industry.

The missing Malaysian Airlines flight from several months ago, and the tragic landing accident of Asiana flight 214 one year ago both illustrate the risk of mishaps that have catastrophic effects on the affected passengers and their families.  Statistically speaking, these tragic airplane mishaps are rare and we’re all familiar with oft-cited fact that air travel is actually safer than highway travel.  Still, many people have a fear of flying primarily because of the horrors of these rare but tragic events.

The airlines face many other less dramatic risks such as less serious injuries to passengers who thump their head on airplane overhead bins and employees who are injured as they coordinate the massive logistical dance that takes place at the gates and on the ramps of airports everywhere daily.  And then there are all of those little carts, tractors, and trucks darting in and out between airplane gates that must avoid collisions and mishaps to person and property while still hustling to keep the airlines on schedule.

It’s not just property and liability risk either.  There are business and strategic risks associated with the hedging of fuel prices which is perhaps the most significant driver of airline profitability.  Brand/reputation risks can be affected by any number of factors, including the catastrophic occurrences such as those described above.

I’m sure that I’m just scratching the surface, and I have to get going to the airport to meet my daughter.  Let me know what you think about the risks associated with the airline industry.  My hat is off to airline and airport risk managers.

One graduate’s perspective

Happy Independence Day!  This holiday is a celebration of the birth of our nation with the Declaration of Independence on July 4, 1776.  However, this morning I am thinking of “independence” in more general terms.  I am thinking about the journey to independence taken by many young college students as they complete their degrees.  It’s a time of much personal and cognitive growth as they pursue knowledge and social growth working towards a chosen career path.  I’ve seen this growth and journey toward independence in my students and in my own daughters.

Recent Ferris State graduate Ethan Henderson discovered that he had a passion for the risk management and insurance industry while attending Ferris State.  Ethan has now begun his insurance career and he shared the following words about his Ferris experience:

Ferris State University is the reason I am graduating college with a job doing what I want to do. To further explain, I need to talk about the recently reinstated risk management and insurance degree at Ferris. I made the switch from Finance to Insurance after my sophomore year at Ferris, mainly because I did not want a typical desk job, preferring something more interactive and social instead. I liked the idea of math and risk assessment, but wanted to tie that in with marketing and personal selling. The program was like nothing else I had learned up to that point.  As soon as I started in the assigned curriculum, it was obvious that the material was very specific. With courses ranging from the specifics of property and casualty insurance, all the way to the broader business management and law type courses.

About two months along in the insurance program an opportunity for an insurance internship with State Farm in Big Rapids came across my email from my advisor. I immediately responded, was interviewed, and hired within two weeks. Through the internship I was able to receive my producer’s license in property, casualty, life, accident, and health, as well as become bank certified. Without a doubt I could not have passed any of those exams without the current curriculum and information I was learning in my insurance courses at Ferris.

The internship turned into a part time sales job that I held for the rest of my time at Ferris State. In December of my senior year, I began to apply all around the country for a commercial underwriting position, post-graduation. Deciding that I wanted to start my career in underwriting was something that I had decided upon learning about the job in my insurance courses, and wanting to get out of sales, at least for a while.  I had multiple phone interviews, and ended up getting to the last in person interview for two different companies by February of my senior year. I drove down to Cincinnati, as well as Farmington Hills, Michigan to interview. Within three weeks I was called back and offered a commercial underwriting position at both companies! So not only was I still two months away from graduation, but I had two amazing job offers to choose from. Both companies stressed the appeal of my Insurance degree from Ferris, as well as the internship that I was set up with through the program. I ended up taking the commercial underwriting job for the Farmington Hills company, and they have located me in Minneapolis, Minnesota.  I could not be happier with the education and opportunities this University and the risk management and insurance degree have provided me.