Risk Management

The Profession

Mary Anne Hilliard has served in several risk management and safety positions with Children’s National, and says keeping kids safe and healthy is a fulfilling reward.
By: | November 2, 2016 • 4 min read

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R&I What was your first job?

I got my first real job at the age of 14 working for Burger King in Coral Springs, Fla. Coming out of college, I was a registered nurse here at Children’s National in the adolescent unit.

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

I wanted to build on my nursing career. I was thinking of being a nurse practitioner but my roommate was studying for the bar, and I thought that would be an interesting combination, so I ended up going to law school. When I graduated, I worked at a law firm in Washington DC, Jackson and Campbell, PC, where I practiced health law with a concentration on malpractice defense litigation. Children’s National, one of our clients, recruited me back in-house.

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

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We’ve focused our risk management approach on building trust by doing the right thing.  Two important examples include our approach to disclosure and our focus on prevention as the best way to manage risk.  Many times that means focusing our safety efforts on the prevention of negligence-based injury.

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

Risk managers need to make sure they are keeping up with needs as they relate to new business models and new payment models in health care. As we make the shift from volume-based to value-based care, risk managers will need to refocus and make sure they’re appropriately managing new risks. … For example, the current incentives are modeled to keep people well so they don’t get admitted to the hospital, but what if someone needs to be admitted, and we’re too slow to do it because we’re trying to reduce readmissions? We can help health care providers change their business model without having to learn the hard way.

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

Doing the right thing. That will always be the hardest part about working in risk. The phone rings when something has gone wrong. I joke with my team that being in risk management is like working in a kitchen: It’s always hot!  That’s why we risk managers have to stick together and share strategies for success.

R&I What emerging commercial risk most concerns you?

In health care, it’s the consolidation in the marketplace and the shift to value-based care and consumerism. As it relates to traditional malpractice exposure, the biggest risk is probably IT-related risks and cyber exposure.

R&I Are you optimistic about the U.S. economy or pessimistic and why?

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I’m optimistic because America is a great country with a solid foundation around individual rights and freedom. Sometimes the press and politics can cause us to lose sight of that. But we still lead the way in many domains.

R&I Who is your mentor and why?

Dominic Colaizzo from Aon, because he taught me that the best way to manage risk is to do the right thing — especially after you’ve done the wrong thing. After you’ve done a great job with prevention, then you focus on buying insurance from a company that you trust.

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

The team at Children’s National was able to reduce our rate of serious safety events by greater than 80 percent. And we’ve sustained that for nearly a decade.

R&I How many emails do you get in a day?

I get about 200. I answer 150, and spend too many weekends catching up!

R&I What is your favorite book or movie?

I recently enjoyed “Positive Intelligence” by Shirzad Chamine. It’s a great read for everyone looking for life balance and for risk managers looking for strategies to stay cool in the kitchen!

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

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I love this little Italian place called Pulcinella that’s right in my neighborhood. They know my family by name and they have great pizza.

R&I What is your favorite drink?

Beer. Sam Adams.

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

I just came back from Donegal, Ireland, where I visited some old Irish relatives. I saw the site where my grandfather’s house had been. My kids were with me, and it was an amazing experience.

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

Running with headphones. I’ve had some close calls with that. But it’s a risk worth taking because it keeps me physically and mentally healthy.

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

The rewarding part of working in pediatric health care is being part of a team that takes care of kids.

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

They’re not really sure. They know I work in a hospital and that I get a lot of calls at weird times, and that I love what I do. &




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

More from Risk & Insurance

More from Risk & Insurance

Property

Insurers Take to the Skies

This year’s hurricane season sees the use of drones and other aerial intelligence gathering systems as insurers seek to estimate claims costs.
By: | November 1, 2017 • 6 min read

For Southern communities, current recovery efforts in the wake of Hurricane Harvey will recall the painful devastation of 2005, when Katrina and Wilma struck. But those who look skyward will notice one conspicuous difference this time around: drones.

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Much has changed since Katrina and Wilma, both economically and technologically. The insurance industry evolved as well. Drones and other visual intelligence systems (VIS) are set to play an increasing role in loss assessment, claims handling and underwriting.

Farmers Insurance, which announced in August it launched a fleet of drones to enhance weather-related property damage claim assessment, confirmed it deployed its fleet in the aftermath of Harvey.

“The pent-up demand for drones, particularly from a claims-processing standpoint, has been accumulating for almost two years now,” said George Mathew, CEO of Kespry, Farmers’ drone and aerial intelligence platform provider partner.

“The current wind and hail damage season that we are entering is when many of the insurance carriers are switching from proof of concept work to full production rollout.”

 According to Mathew, Farmers’ fleet focused on wind damage in and around Corpus Christi, Texas, at the time of this writing. “Additional work is already underway in the greater Houston area and will expand in the coming weeks and months,” he added.

No doubt other carriers have fleets in the air. AIG, for example, occupied the forefront of VIS since winning its drone operation license in 2015. It deployed drones to inspections sites in the U.S. and abroad, including stadiums, hotels, office buildings, private homes, construction sites and energy plants.

Claims Response

At present, insurers are primarily using VIS for CAT loss assessment. After a catastrophe, access is often prohibited or impossible. Drones allow access for assessing damage over potentially vast areas in a more cost-effective and time-sensitive manner than sending human inspectors with clipboards and cameras.

“Drones improve risk analysis by providing a more efficient alternative to capturing aerial photos from a sky-view. They allow insurers to rapidly assess the scope of damages and provide access that may not otherwise be available,” explained Chris Luck, national practice leader of Advocacy at JLT Specialty USA.

“The pent-up demand for drones, particularly from a claims-processing standpoint, has been accumulating for almost two years now.” — George Mathew, CEO, Kespry

“In our experience, competitive advantage is gained mostly by claims departments and third-party administrators. Having the capability to provide exact measurements and details from photos taken by drones allows insurers to expedite the claim processing time,” he added.

Indeed, as tech becomes more disruptive, insurers will increasingly seek to take advantage of VIS technologies to help them provide faster, more accurate and more efficient insurance solutions.

Duncan Ellis, U.S. property practice leader, Marsh

One way Farmers is differentiating its drone program is by employing its own FAA-licensed drone operators, who are also Farmers-trained claim representatives.

Keith Daly, E.V.P. and chief claims officer for Farmers Insurance, said when launching the program that this sets Farmers apart from most carriers, who typically engage third-party drone pilots to conduct evaluations.

“In the end, it’s all about the experience for the policyholder who has their claim adjudicated in the most expeditious manner possible,” said Mathew.

“The technology should simply work and just melt away into the background. That’s why we don’t just focus on building an industrial-grade drone, but a complete aerial intelligence platform for — in this case — claims management.”

Insurance Applications

Duncan Ellis, U.S. property practice leader at Marsh, believes that, while currently employed primarily to assess catastrophic damage, VIS will increasingly be employed to inspect standard property damage claims.

However, he admitted that at this stage they are better at identifying binary factors such as the area affected by a peril rather than complex assessments, since VIS cannot look inside structures nor assess their structural integrity.

“If a chemical plant suffers an explosion, it might be difficult to say whether the plant is fully or partially out of operation, for example, which would affect a business interruption claim dramatically.

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“But for simpler assessments, such as identifying how many houses or industrial units have been destroyed by a tornado, or how many rental cars in a lot have suffered hail damage from a storm, a VIS drone could do this easily, and the insurer can calculate its estimated losses from there,” he said.

In addition,VIS possess powerful applications for pre-loss risk assessment and underwriting. The high-end drones used by insurers can capture not just visual images, but mapping heat, moisture or 3D topography, among other variables.

This has clear applications in the assessment and completion of claims, but also in potentially mitigating risk before an event happens, and pricing insurance accordingly.

“VIS and drones will play an increasing underwriting support role as they can help underwriters get a better idea of the risk — a picture tells a thousand words and is so much better than a report,” said Ellis.

VIS images allow underwriters to see risks in real time, and to visually spot risk factors that could get overlooked using traditional checks or even mature visual technologies like satellites. For example, VIS could map thermal hotspots that could signal danger or poor maintenance at a chemical plant.

Chris Luck, national practice leader of Advocacy, JLT Specialty USA

“Risk and underwriting are very natural adjacencies, especially when high risk/high value policies are being underwritten,” said Mathew.

“We are in a transformational moment in insurance where claims processing, risk management and underwriting can be reimagined with entirely new sources of data. The drone just happens to be one of most compelling of those sources.”

Ellis added that drones also could be employed to monitor supplies in the marine, agriculture or oil sectors, for example, to ensure shipments, inventories and supply chains are running uninterrupted.

“However, we’re still mainly seeing insurers using VIS drones for loss assessment and estimates, and it’s not even clear how extensively they are using drones for that purpose at this point,” he noted.

“Insurers are experimenting with this technology, but given that some of the laws around drone use are still developing and restrictions are often placed on using drones [after] a CAT event, the extent to which VIS is being used is not made overly public.”

Drone inspections could raise liability risks of their own, particularly if undertaken in busy spaces in which they could cause human injury.

Privacy issues also are a potential stumbling block, so insurers are dipping their toes into the water carefully.

Risk Improvement

There is no doubt, however, that VIS use will increase among insurers.

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“Although our clients do not have tremendous experience utilizing drones, this technology is beneficial in many ways, from providing security monitoring of their perimeter to loss control inspections of areas that would otherwise require more costly inspections using heavy equipment or climbers,” said Luck.

In other words, drones could help insurance buyers spot weaknesses, mitigate risk and ultimately win more favorable coverage from their insurers.

“Some risks will see pricing and coverage improvements because the information and data provided by drones will put underwriters at ease and reduce uncertainty,” said Ellis.

The flip-side, he noted, is that there will be fewer places to hide for companies with poor risk management that may have been benefiting from underwriters not being able to access the full picture.

Either way, drones will increasingly help insurers differentiate good risks from bad. In time, they may also help insurance buyers differentiate between carriers, too. &

Antony Ireland is a London-based financial journalist. He can be reached at [email protected]