Ten years, still on this plan

I've been auditing myself for the last 18 months or so. It's a necessary part of the business plan I am executing. But, some moments sting a bit. I wrote this 10/26/2010. This was while I was planning my exit and about 7 months before starting a new company. Unedited, but adding some context. Overall, I was right. But, overall, I also had no idea how hard it is to undo the mindset of an industry.

"What if we are at square one? If the mission is to truly take care of people how can you do this with one product, but the thing is we do not have just one product we also have Safeco, we have group life and disability we have large insurance we have small business insurance through Safeco/peerless so square one needs to get bigger. 

What if we stopped with what we had already, the only new business we add is that that comes in through the existing policyholders we have. What if we just stopped and made sure everything we had was accurate. Everything is not necessarily reasonable so what percentage of the book can be touched?

What would you need to know? You would need to know a factual account of the policies we have on file. What would be a procedure?

·         Make the addresses accurate, delete anything over 5 years old

·         Make the phone numbers accurate delete old SPI information

·         Use the new feature to disable duplicate members

·         Through this conversation you can be cross-selling, strengthening the relationship, reminding about referrals. 

Do you rewrite? If the customer asks and is being “cooperative” I would think you would want to be proactive. The worst thing that happens is we do not have a better rate, the best thing is the majority of the people would be thrilled with lower rates and would likely ignore all the offers coming in from the other companies, this could be two ways to counter the existing soft market and develop the relationships needed to be strong going into the next soft market. 

Is it an information problem? How many duplicate households can be decreased? What kind of savings would we realize by cleaning up addresses and removing these duplicates by way of not mailing to these people? 

How would you get everyone on board? You communicate the message clearly, that if we start at a $10,000,000 book and end the year at a $10,000,000 book it can still be a success. What if we increase the retention rate? What if we add policies therefore hopefully strengthening retention. Is that a win? What if during this year and in these conversations we educated on claims? What if people chose higher deductibles and therefore less claims were submitted? How much does this save? What if we discouraged people with triple a or other care towing services from using ours? Yes, we lose $5 but how many claims does this prevent? Although removing the coverage removes income how many claims and associated costs does it remove?

How many LJ's(umbrella policies) have the wrong information? How many LJ's are missing the declarations page for the homes we do not insure? What a great way to get some quotes. You would have to have a designated production team, for this in order to save on the follow-up and make sure this is getting done. How much money can we make here?

How about FN's(rental properties)? How many do we insure and we do not insure the primary home? What about where liability could be extended? What about the people that have other risks and would not mind a full review? How much cross-selling can occur?

Is this like a premium clean up project? What are the success measures? Can we designate the server space being used? Is the policy account an accurate measure? NO dollars in and out are the only accurate measure. Back to the point above, if 1/1/2011 the book is worth $10,000,000 and then on 1/1/2012 the book is worth $10,000,000 is that a success? 

Yes, if the number of claims is down, frequency cost money.

Yes, if by a silly measuring stick of policy count as a source of retention, that the total policy count is up

Yes, if there is a survey being done and the scores increase

The opportunity was there to publicly state that “ as the country went through this difficult time we are going to tighten our belts and not increase rates…” it is not a matter of taking away compensation or perceived rewards but rather a function of how we do business how can we do business better? Will better save money, yes. Will better increase loyalty, yes in all likelihood it would. Imagine how it would have flipped every company on their heads if we made notice publicly that nobody will see an increase in 2011.

What else?

Have I scaled it, yes. Have I done it several times with "smaller" test sets of data? Yes. Has it taken hold and really scaled beyond a few hundred to a couple of thousand households(customers)? Not yet. Far more obstacles than I thought. But everything listed works and scales.