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Column: Workers' Comp

Optimistic Voices

By: | March 3, 2017 • 2 min read
Roberto Ceniceros is senior editor at Risk & Insurance® and chair of the National Workers' Compensation and Disability Conference® & Expo. He can be reached at [email protected] Read more of his columns and features.

Workers’ comp industry optimists expect that President Trump’s economic policies will help propel additional insurer premium volume growth through 2017 and even beyond.

Recent growth in employment and wages are expected to generate billions in new workers’ comp premiums written. Factors like lower business taxes, reduced regulatory burdens and shifts in trade policy espoused by the president could fuel further growth.

“Certainly the proposals of the current president suggest it is quite possible we will have an increase in employment in 2017,” including policies that motivate companies to hire domestically rather than overseas, all of which would add to workers’ comp premiums, said Steven N. Weisbart, senior VP and chief economist at the Insurance Information Institute.

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That would also presumably spread revenue to other industry service providers. More jobs inevitably mean more injured workers to service, especially the newly hired.

Recent growth in employment and wages are expected to generate billions in new workers’ comp premiums written.

Weisbart calls his viewpoint “mildly optimistic.” He isn’t alone. His optimism is shared by others who pay close attention to how economic trends impact the workers’ comp industry.

Shifts in business and economic policies, including potential trade agreement changes, are expected to contribute to a strengthening economy over the next couple of years, said John T. Leonard, president and CEO at MEMIC Group, a Portland, Maine-based workers’ comp insurer.

“There will be an increase in payroll associated with a growing economy, particularly [in construction] and payroll is the cornerstone of the development of premium,” he said.

Yet, doubters suggest President Trump’s actions could backfire.

I write my columns a few weeks before publication and as I craft this particular one, headlines suggest Trump-inspired trade wars could slice gross domestic product and harm trade-dependent U.S. employment.

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Even the optimists know headwinds are always a threat.

We are in the midst of one of the longest economic expansions since World War II, increasing the historical likelihood of a coming recession, Weisbart said. But a recession could get pushed farther out, should Congress go along with the president’s proposals, he said.

There is no shortage of oft-quoted comments about the value of economic predictions. Some point out that even with hindsight, observers never agreed on the Great Recession’s causes, let alone its ferocity.

Perhaps, Yogi Berra said it best with his simple quote, “It’s hard making predictions, especially when they are about the future.”

I don’t agree with a lot of President Trump’s policies. But on this topic I hope Weisbart and the optimists have it right. Not many would disagree that economic expansion is always more fun than contraction. &

More from Risk & Insurance

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The Profession

Curt Gross

This director of risk management sees cyber, IP and reputation risks as evolving threats, but more formal education may make emerging risk professionals better prepared.
By: | June 1, 2018 • 4 min read

R&I: What was your first job?

My first non-professional job was working at Burger King in high school. I learned some valuable life lessons there.

R&I: How did you come to work in risk management?

After taking some accounting classes in high school, I originally thought I wanted to be an accountant. After working on a few Widgets Inc. projects in college, I figured out that wasn’t what I really wanted to do. Risk management found me. The rest is history. Looking back, I am pleased with how things worked out.

R&I: What is the risk management community doing right?

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I think we do a nice job on post graduate education. I think the ARM and CPCU designations give credibility to the profession. Plus, formal college risk management degrees are becoming more popular these days. I know The University of Akron just launched a new risk management bachelor’s program in the fall of 2017 within the business school.

R&I: What could the risk management community be doing a better job of?

I think we could do a better job with streamlining certificates of insurance or, better yet, evaluating if they are even necessary. It just seems to me that there is a significant amount of time and expense around generating certificates. There has to be a more efficient way.

R&I: What was the best location and year for the RIMS conference and why?

Selfishly, I prefer a destination with a direct flight when possible. RIMS does a nice job of selecting various locations throughout the country. It is a big job to successfully pull off a conference of that size.

Curt Gross, Director of Risk Management, Parker Hannifin Corp.

R&I: What’s been the biggest change in the risk management and insurance industry since you’ve been in it?

Definitely the change in nontraditional property & casualty exposures such as intellectual property and reputational risk. Those exposures existed way back when but in different ways. As computer networks become more and more connected and news travels at a more rapid pace, it just amplifies these types of exposures. Sometimes we have to think like the perpetrator, which can be difficult to do.

R&I: What emerging commercial risk most concerns you?

I hate to sound cliché — it’s quite the buzz these days — but I would have to say cyber. It’s such a complex risk involving nontraditional players and motives. Definitely a challenging exposure to get your arms around. Unfortunately, I don’t think we’ll really know the true exposure until there is more claim development.

R&I: What insurance carrier do you have the highest opinion of?

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Our captive insurance company. I’ve been fortunate to work for several companies with a captive, each one with a different operating objective. I view a captive as an essential tool for a successful risk management program.

R&I: Who is your mentor and why?

I can’t point to just one. I have and continue to be lucky to work for really good managers throughout my career. Each one has taken the time and interest to develop me as a professional. I certainly haven’t arrived yet and welcome feedback to continue to try to be the best I can be every day.

R&I: What have you accomplished that you are proudest of?

I would like to think I have and continue to bring meaningful value to my company. However, I would have to say my family is my proudest accomplishment.

R&I: What is your favorite book or movie?

Favorite movie is definitely “Good Will Hunting.”

R&I: What’s the best restaurant you’ve ever eaten at?

Tough question to narrow down. If my wife ran a restaurant, it would be hers. We try to have dinner as a family as much as possible. If I had to pick one restaurant though, I would say Fire Food & Drink in Cleveland, Ohio. Chef Katz is a culinary genius.

R&I: What is the most unusual/interesting place you have ever visited?

The Grand Canyon. It is just so vast. A close second is Stonehenge.

R&I: What is the riskiest activity you ever engaged in?

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A few, actually. Up until a few years ago, I owned a sport bike (motorcycle). Of course, I wore the proper gear, took a safety course and read a motorcycle safety book. Also, I have taken a few laps in a NASCAR [race car] around Daytona International Speedway at 180 mph. Most recently, trying to ride my daughter’s skateboard.

R&I: If the world has a modern hero, who is it and why?

The Dalai Lama. A world full of compassion, tolerance and patience and free of discrimination, racism and violence, while perhaps idealistic, sounds like a wonderful place to me.

R&I: What about this work do you find the most fulfilling or rewarding?

I really enjoy the company I work for and my role, because I get the opportunity to work with various functions. For example, while mostly finance, I get to interact with legal, human resources, employee health and safety, to name a few.

R&I: What do your friends and family think you do?

I asked my son. He said, “Risk management and insurance.” (He’s had the benefit of bring-your-kid-to-work day.)

Katie Dwyer is an associate editor at Risk & Insurance®. She can be reached at [email protected]