Column: Roger's Soapbox

Pollsters, Ponies And Post-Truths

By: | March 3, 2017 • 3 min read
Roger Crombie is a United Kingdom-based columnist for Risk & Insurance®. He can be reached at [email protected]

Here’s what we know about what lies ahead: nothing. Nothing at all. Events are largely unpredictable far into the future; people much more so at any remove. Earthquakes happen without much warning; life is a minestrone.

To quote George Carlin: “We’re all here on a big rock, zippin’ around a bad star for no good reason. We don’t know where we came from, we don’t know where we’re going, we don’t know how long it’s gonna last, and we have to keep going to the bathroom. And on top of that, the whole thing is completely meaningless.”

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Despite which, forecasting is a basic requirement of any business — and in four industries that come immediately to mind, it’s the entire business.

What do the pollsters do wrong that insurance does right?

Weather forecasting is the weakest one. The bouncy weather girl hasn’t been selected for her brains or inside knowledge, because, generally speaking, she has neither.

Polling is another, although its reputation lies in ruin following a recent stunning series of wrong forecasts. Brexit. The British economy post-Brexit. Trump. Events have proven beyond the forecasting abilities of pollsters and economists, for that matter. The dismal science indeed.

Bookmaking fares better — not the art of printing and binding, but the science of knowing which horse or team will win the race or the game (Trump foxed even those guys). The “bookies” (or the OTB or what have you) make a solid living forecasting the outcome of complex events.

So do insurers. What is insurance if not the ability to accurately forecast life spans and accident probabilities?

Which begs the question: What do the pollsters do wrong that insurance does right? Easy enough to discern. It’s the clause in every insurance contract that says that if you lied on your application in any meaningful way, the policy is invalid. Simple.

Pollsters must rely on the answers they are given. Many of them phrase their questions to derive desired answers. I know this to be true, because I been politically polled. What was wanted was not the truth, but confirmation of the pollsters’ biases.

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Insurers want the truth, the whole truth and, quite literally, nothing but the truth. Not the post-truth or the alternative truth. A smoker who claims to abstain is warping beyond repair the forecasts on which premiums are based. The citizen who says she intends to vote Clinton, because she is embarrassed to admit to liking Trump, can lie with impunity. Many of them did, apparently.

Horse racing, football and all sports on which wagers are laid also rely on the integrity of the players, the officials and the supervising bodies. That’s why a drugged athlete offends our sense of fair play. Without that, all bets are off.

My truth may differ from yours, but the smart forecasting industries dial that out of the equation. That’s why insurance companies have billions and why there are at least two legalized betting shops on every high street in Britain.

Martin Luther King put it best: Peace if possible, truth at all costs. &

More from Risk & Insurance

More from Risk & Insurance

2017 Risk All Stars

Immeasurable Value

The 2017 Risk All Stars strengthened their organizations by taking ownership of improved risk management processes and not quitting until they were in place.
By: | September 12, 2017 • 3 min read

Being the only person to hold a particular opinion or point of view within an organization cannot be easy. Do the following sound like familiar stories? Can you picture yourself or one of your risk management colleagues as the hero or heroine? Or better yet, as a Risk & Insurance® Risk All Star?

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One risk manager took a job with a company that was being spun off, and the risk management program, which was built for a much larger company, was not a good fit for the spun-off company.
Rather than sink into inertia, this risk manager took the bull by the horns and began an aggressive company intranet campaign to instill better safety and other risk management practices throughout the organization.

The risk manager, 2017 Risk All Star Michelle Bennett of Cable One, also changed some long-standing brokerage relationships that weren’t a good fit for the risk management and insurance program. In her first year on the job she produced premium savings and in her second year is in the process of introducing ERM company-wide.

Or perhaps this one rings a bell. The news is trickling out that a company is poised to dramatically expand, increasing the workforce three- or four-fold. Having this knowledge with certainty would be a great benefit to a risk manager, who could begin girding safety, workers’ comp and related programs accordingly. But things sometimes don’t work that way, do they? Sometimes the risk manager is one of the last people to know.

The Risk All Star Award recognizes at its core, creativity, perseverance and passion. The 13 winners of this year’s award all displayed those traits in abundance.

In the case of 2017 Risk All Star winner Steve Richards of the Coca-Cola Bottling Company, the news of an expansion spurred him to action. He completely overhauled the company’s workers’ compensation program and streamlined its claim management system. The results, even with a much higher headcount, were reduced legal costs, better return-to-work experiences for injured workers and a host of other improvements and savings.

The Risk All Star Award recognizes at its core, creativity, perseverance and passion. The 13 winners of this year’s award all displayed those traits in abundance. Sometimes it took years for a particular risk solution, as promoted by a risk manager, to find acceptance.

In other cases a risk manager got so excited about a solution, they never even considered getting turned down. They just kept pushing until they carried the day.

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Butler University’s Zach Finn became obsessive about what he felt was a lackluster effort on the part of the insurance industry to bring in new talent. The former risk manager for the J.M. Smucker Co. settled on the creation of a student-run captive to give his risk management students the experience they would need to get hired right out of college.

The result was a better risk management program for the university’s College of Liberal Arts and Sciences, and immediate traction in the job market for Finn’s students.

A few of our Risk All Stars told us that the results they are achieving were decades in the making. Only by year-in, year-out dedication to gaining transparency about her co-op’s risks and learning more and more about her various insurance carriers, did Growmark Inc.’s Faith Cring create a stalwart risk management and insurance program that is the envy of the agricultural sector. Now she’s been with some of her insurance carriers more than 20 years — some more than 30 years.

Having the right idea and not having a home for it can be a lonely, frustrating experience. Having the creativity, the passion and perhaps, most importantly, the perseverance to see it through and get great results makes you a Risk All Star. &

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Risk All Stars stand out from their peers by overcoming challenges through exceptional problem solving, creativity, perseverance and passion.

See the complete list of 2017 Risk All Stars.

Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]