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The Thomas Howell Ferguson Blog

FINREP Texas Kicks Off the Inaugural Conference in 2022! (Part Two)

November 18, 2022 – Austin, Texas – Noelle Codispoti from The National Alliance for Insurance Education & Research discussed the opportunities for recruiting and retaining the next generation of professionals in the insurance industry.  She focused on three things that team members need:

  1. Companies must provide what they need in order to be successful (equipment, tools, etc.)
  2. Employees need to feel safe and respected
  3. The team must be comprised of the right individuals

She discussed the importance of communication to the employees on the plan the companies have for them. Often, the employer has a plan but fails to communicate that plan to the employee.  Communicating that plan helps the employee to avoid the guessing game and not feel unappreciated. 

Nicole Thornbro from the Texas Department of Insurance discussed some popular fraud schemes.  Those include agent fraud, employee fraud, workers’ comp fraud, etc.  Other popular fraud schemes include vehicle fires, date of loss fraud (which is the most popular), lies about the excluded drivers, exaggerated theft claims, and fictitious titles. 

Agent fraud includes slumming or stealing premiums, not funding policies at all, adding claimants to legitimate claims, employing unlicensed individuals and then collecting kickbacks from them, and commission schemes on things like identity theft for life or fire policies. 

With regards to employees’ involvement in fraud, she notes that not only are they caught stealing documents, but they are often involved in fraudulent situations in nursing homes.  There, they are caught manipulating the residents’ trust fund accounts and stealing patient information to sell to insurance company agents for cold calling. 

Her comments on crime rings include doctors’ and lawyers’ offices’ involvement, staged accident rings, staged home burglaries, body shop exaggeration of after-market items, employees stealing info, etc. 

Deputy Commissioner of the Financial Regulation Division, Jamie Walker, gave an update on the Texas Department of Insurance (TDI).  Texas is the 2nd largest insurance market in the United States and the 7th largest in the world.  She said that there are two things that we should monitor:

  1. The NAIC land definition project
  2. The NAIC investment reporting project 

Commissioner Walker said that she wants to hear from companies, especially when things are going well! She likes to hear about solutions to problems. 

THF’s Mike Rosciam gave a short update on hackers.  First, 45% of companies have experienced a data breach, and 91% of those started with an email.  He reminded everyone that you don’t have to be the best at this, but you at least must be better than the lowest company. 

One way to protect your company is to encourage your team to use a system like LastPass.com where you can store your passwords.  He encourages using long passwords with multiple letters, symbols, and numbers.  In addition, he says to use different passwords for everything.  If a hacker gets access to one of your passwords, then you’re in trouble if they are all the same or similar. 

Gary Wang from Pinnacle Actuaries discussed bias in insurance.  He said that race in insurance is not a new discussion.  He noted that culture, for example, can predict eating habits that affect your overall health and, therefore, your insurance.  For companies, if you differentiate, make sure you base it on meaningful information. 

Overall, this is a difficult discussion.  We all have different ideas of what it means to be fair.  What are the underlying factors that cause certain races to be at higher risk?  Is it jobs?  Is it the quality of homes?

There is no good definition to describe what it means to create unfairness to people.  Gary discussed questions like, how are you going to price policies in minority-dominated areas vs. non-minority-dominated areas?  In the end, fairness costs money. 

Great topic, which we know that we’ll see and hear more about in the future. 

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