Insurance Underwriters Miss Face-to-Face Meetings. But Not for the Reasons You’d Think

In-person meetings used to be a staple of the insurance buying process. COVID-19 has forced underwriters and insureds to get creative when it comes to building relationships and pricing risks.
By: | October 9, 2020

For many companies, being able to tell their insurance and risk management story to carriers during in-person meetings has been key to the process of gaining coverage.

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Insureds get to share everything from risk management strategies and loss control efforts to their programs’ history, and underwriters get to decide based on these presentations if a relationship is worth pursuing.

“This is a people business,” said Donna Nadeau, chief underwriting officer for the Americas region at AXA XL. “We work in an industry that thrives on face-to-face meetings and person-to-person contact.”

When COVID-19 struck, the tradition of face-to-face meetings had to be put on hold. Now, underwriters are turning to new strategies, like video meetings and virtual site visits, to make up for a lack of in-person communication while insureds are relying more on data to market their risk management strategies and help secure coverage.

Good-Bye Eye Contact, Hello Zoom Fatigue

Overall, not too much has changed about the underwriting process since the pandemic hit. Underwriters were largely able to transition over to virtual means of communication and continue pricing risk remotely.

“I wouldn’t say that there’s actually been a tremendous negative impact,” said Lindsay Grimes, Marsh’s southeast property placement hub leader. “It’s more a loss of some of the relationship building opportunities between clients and underwriters.”

Donna Nadeau, chief underwriting officer, Americas, AXA XL

The biggest loss, as everyone transitioned to virtual meetings, has been the loss of relationship building moments that can happen in between meetings and the ability to read speaker body language during presentations.

“In-person meetings often give you the opportunity to have sidebar conversations where you might learn interesting nuances about the client’s business,” Grimes said.

The inability to conduct in-person is felt most acutely by insureds that are developing new underwriter relationships and those in lines that are facing hardening markets.

In new client relationships, insureds are often meeting underwriters for the first time over Zoom, where it can be more difficult to read their body language and facial cues due to the limited space speakers have for movement and gestures.

“Building new relationships is a bit more difficult virtually,” Nadeau said.

On top of that, speakers may experience Zoom fatigue, a condition where a person becomes mentally-drained from too many or too long of a video call, and thus is less energetic than they may be in-person.

“It’s been a lot more challenging to develop new relationships when it’s virtual. You’re trying to meet people on Zoom, and it can feel cold,” Grimes said.

“Those clients that already had deep rooted underwriting relationships and brokers that already had deep rooted underwriting relationships, I think have seen more success in this market.”

For insureds facing a hard market, the lack of face-to-face communication can also make it challenging to find coverage. Presenting a company’s risk mitigation strategies and telling a compelling story about previous losses can be key to securing coverage in already hardening markets like property and D&O lines.

“In a soft market … you don’t really need the in-person meeting or even a virtual meeting, because everybody’s trying to kind of grab up whatever premiums are available,” Grimes said.

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“In a harder market, it becomes more critical for underwriters to get a sense of a client’s risk management and risk mitigation strategies.”

New Technologies Bridge the Gap

The lack of in-person meetings has forced underwriters to get creative as they find new ways to meet with clients and price risk.

“Our underwriting teams have adapted remarkably well to this new, virtual world,” Nadeau said. “Not being able to connect in-person has resulted in the need to be quite creative.”

One solution has been virtual meetings — with cameras on. While imperfect, this gives underwriters a sense of a client’s body language and allows insurers to present information in ways that would be impossible during a “typical” phone call.

Lindsay Grimes, property placement hub leader, Marsh

“The advantage of videos is actually seeing people and seeing their expressions and reading body language,” Nadeau said.

The inability to jettison across the country for client meetings has also been somewhat of an advantage for underwriters and insureds. With travel time cut out, underwriters can work more efficiently and meet with their clients more frequently.

“We actually have more time to spend with clients. We’re not hopping on a plane and spending three hours or four hours or five hours traveling, and so we can take some of that time and then we can dedicate it to having a longer virtual meeting or more virtual meetings,” Nadeau said.

“Underwriters have had almost more contact with clients given the ease with which they can hop on a Zoom call with an existing or prospective client with no travel required,” Grimes added.

They’re also coming up with ways to assess risk and conduct site visits virtually, something that is especially important for lines like property, where seeing the structure can give underwriters an idea of what types of dangers it may face from natural disasters.

At AXA XL, Nadeau noted that the insurer has created a tool risk engineers use to assess sites and offer clients risk management feedback without an in-person visit. “This is a tool they can use that allows them to have those site visits virtually, and then we can provide feedback to our client so that they continue to manage risk,” she said.

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On the insured side, using data to clearly communicate program history and risk management efforts can help underwriters get a better picture of what a company needs from its insurance policies.

“Data is more critical than ever,” Grimes said.

“Underwriters are being inundated with submissions, and if they get a submission across their desk that has poor data, they’re not even really taking the time to come back to us and ask the client for additional information. They’re just declining it.”

In addition to a clear, robust data picture, insureds should work with their brokers to craft submission documents that give carriers and underwriters a strong sense of the state of the company.

A rigorous submission document, complete with loss history, data and the company’s risk management story, can help give businesses a better shot of securing coverage in this virtual world.

Put together a more robust submission document that includes a client introductory video and a clear risk mitigation playbook,” Grimes said. “Give an overview of the state of the business to kick off the submission and to give carriers a better sense as to where the business stands. Oftentimes, that’s what they are talking about in-person with that client.”

Post-Pandemic, Will Face-to-Face Meetings Return?

Though virtual solutions have helped underwriters connect with clients and conduct site visits, insureds and insurers alike are eager to get back to face-to-face communication. “When the time comes, we will absolutely get back to in-person meetings,” Nadeau said.

Some clients, Nadeau noted, are even pushing to conduct in-person meetings in states that have eased their coronavirus restrictions. Insureds are already requesting outdoor meetings and lunches with underwriters to discuss coverage options and to present new risk management strategies.

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While the industry seems excited to get back to in-person meetings once it’s safe to conduct them, it’s important for both insureds and underwriters to remember the lessons that the pandemic brought, especially when it comes to technology.

“We’ll still use virtual as another tool,” Nadeau said. “It’s a way that we can efficiently connect with people.”

Virtual meetings are yet another tool that underwriters and insureds can benefit from to have quick conversations when a question arises, and strong data will likely become a permanent fixture when insureds present their submission documents. &

Courtney DuChene is a staff writer at Risk & Insurance. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

Risk Scenario

The Betrayal of Elizabeth

In this Risk Scenario, Risk & Insurance explores what might happen in the event a telemedicine or similar home health visit violates a patient's privacy. What consequences await when a young girl's tele visit goes viral?
By: | October 12, 2020
Risk Scenarios are created by Risk & Insurance editors along with leading industry partners. The hypothetical, yet realistic stories, showcase emerging risks that can result in significant losses if not properly addressed.

Disclaimer: The events depicted in this scenario are fictitious. Any similarity to any corporation or person, living or dead, is merely coincidental.

PART ONE: CRACKS IN THE FOUNDATION

Elizabeth Cunningham seemingly had it all. The daughter of two well-established professionals — her father was a personal injury attorney, her mother, also an attorney, had her own estate planning practice — she grew up in a house in Maryland horse country with lots of love and the financial security that can iron out at least some of life’s problems.

Tall, good-looking and talented, Elizabeth was moving through her junior year at the University of Pennsylvania in seemingly good order; check that, very good order, by all appearances.

Her pre-med grades were outstanding. Despite the heavy load of her course work, she’d even managed to place in the Penn Relays in the mile, in the spring of her sophomore season, in May of 2019.

But the winter of 2019/2020 brought challenges, challenges that festered below the surface, known only to her and a couple of close friends.

First came betrayal at the hands of her boyfriend, Tom, right around Thanksgiving. She saw a message pop up on his phone from Rebecca, a young woman she thought was their friend. As it turned out, Rebecca and Tom had been intimate together, and both seemed game to do it again.

Reeling, her holiday mood shattered and her relationship with Tom fractured, Elizabeth was beset by deep feelings of anxiety. As the winter gray became more dense and forbidding, the anxiety grew.

Fed up, she broke up with Tom just after Christmas. What looked like a promising start to 2020 now didn’t feel as joyous.

Right around the end of the year, she plucked a copy of her father’s New York Times from the table in his study. A budding physician, her eyes were drawn to a piece about an outbreak of a highly contagious virus in Wuhan, China.

“Sounds dreadful,” she said to herself.

Within three months, anxiety gnawed at Elizabeth daily as she sat cloistered in her family’s house in Bel Air, Maryland.

It didn’t help matters that her brother, Billy, a high school senior and a constant thorn in her side, was cloistered with her.

She felt like she was suffocating.

One night in early May, feeling shutdown and unable to bring herself to tell her parents about her true condition, Elizabeth reached out to her family physician for help.

Dr. Johnson had been Elizabeth’s doctor for a number of years and, being from a small town, Elizabeth had grown up and gone to school with Dr. Johnson’s son Evan. In fact, back in high school, Evan had asked Elizabeth out once. Not interested, Elizabeth had declined Evan’s advances and did not give this a second thought.

Dr. Johnson’s practice had recently been acquired by a Virginia-based hospital system, Medwell, so when Elizabeth called the office, she was first patched through to Medwell’s receptionist/scheduling service. Within 30 minutes, an online Telehealth consult had been arranged for her to speak directly with Dr. Johnson.

Due to the pandemic, Dr. Johnson called from the office in her home. The doctor was kind. She was practiced.

“So can you tell me what’s going on?” she said.

Elizabeth took a deep breath. She tried to fight what was happening. But she could not. Tears started streaming down her face.

“It’s just… It’s just…” she managed to stammer.

The doctor waited patiently. “It’s okay,” she said. “Just take your time.”

Elizabeth took a deep breath. “It’s like I can’t manage my own mind anymore. It’s nonstop. It won’t turn off…”

More tears streamed down her face.

Patiently, with compassion, the doctor walked Elizabeth through what she might be experiencing. The doctor recommended a follow-up with Medwell’s psychology department.

“Okay,” Elizabeth said, some semblance of relief passing through her.

Unbeknownst to Dr. Johnson, her office door had not been completely closed. During the telehealth call, Evan stopped by his mother’s office to ask her a question. Before knocking he overheard Elizabeth talking and decided to listen in.

PART TWO: BETRAYAL

As Elizabeth was finding the courage to open up to Dr. Johnson about her psychological condition, Evan was recording her with his smartphone through a crack in the doorway.

Spurred by who knows what — his attraction to her, his irritation at being rejected, the idleness of the COVID quarantine — it really didn’t matter. Evan posted his recording of Elizabeth to his Instagram feed.

#CantManageMyMind, #CrazyGirl, #HelpMeDoctorImBeautiful is just some of what followed.

Elizabeth and Evan were both well-liked and very well connected on social media. The posts, shares and reactions that followed Evan’s digital betrayal numbered in the hundreds. Each one of them a knife into the already troubled soul of Elizabeth Cunningham.

By noon of the following day, her well-connected father unleashed the dogs of war.

Rand Davis, the risk manager for the Medwell Health System, a 15-hospital health care company based in Alexandria, Virginia was just finishing lunch when he got a call from the company’s general counsel, Emily Vittorio.

“Yes?” Rand said. He and Emily were accustomed to being quick and blunt with each other. They didn’t have time for much else.

“I just picked up a notice of intent to sue from a personal injury attorney in Bel Air, Maryland. It seems his daughter was in a teleconference with one of our docs. She was experiencing anxiety, the daughter that is. The doctor’s son recorded the call and posted it to social media.”

“Great. Thanks, kid,” Rand said.

“His attorneys want to initiate a discovery dialogue on Monday,” Emily said.

It was Thursday. Rand’s dreams of slipping onto his fishing boat over the weekend evaporated, just like that. He closed his eyes and tilted his face up to the heavens.

Wasn’t it enough that he and the other members of the C-suite fought tooth and nail to keep thousands of people safe and treat them during the COVID-crisis?

He’d watched the explosion in the use of telemedicine with a mixture of awe and alarm. On the one hand, they were saving lives. On the other hand, they were opening themselves to exposures under the Health Insurance Portability and Accountability Act. He just knew it.

He and his colleagues tried to do the right thing. But what they were doing, overwhelmed as they were, was simply not enough.

PART THREE: FALLING DOMINOES

Within the space of two weeks, the torture suffered by Elizabeth Cunningham grew into a class action against Medwell.

In addition to the violation of her privacy, the investigation by Mr. Cunningham’s attorneys revealed the following:

Medwell’s telemedicine component, as needed and well-intended as it was, lacked a viable informed consent protocol.

The consultation with Elizabeth, and as it turned out, hundreds of additional patients in Maryland, Pennsylvania and West Virginia, violated telemedicine regulations in all three states.

Numerous practitioners in the system took part in teleconferences with patients in states in which they were not credentialed to provide that service.

Even if Evan hadn’t cracked open Dr. Johnson’s door and surreptitiously recorded her conversation with Elizabeth, the Medwell telehealth system was found to be insecure — yet another violation of HIPAA.

The amount sought in the class action was $100 million. In an era of social inflation, with jury awards that were once unthinkable becoming commonplace, Medwell was standing squarely in the crosshairs of a liability jury decision that was going to devour entire towers of its insurance program.

Adding another layer of certain pain to the equation was that the case would be heard in Baltimore, a jurisdiction where plaintiffs’ attorneys tended to dance out of courtrooms with millions in their pockets.

That fall, Rand sat with his broker on a call with a specialty insurer, talking about renewals of the group’s general liability, cyber and professional liability programs.

“Yeah, we were kind of hoping to keep the increases on all three at less than 25%,” the broker said breezily.

There was a long silence from the underwriters at the other end of the phone.

“To be honest, we’re borderline about being able to offer you any cover at all,” one of the lead underwriters said.

Rand just sat silently and waited for another shoe to drop.

“Well, what can you do?” the broker said, with hope draining from his voice.

The conversation that followed would propel Rand and his broker on the difficult, next to impossible path of trying to find coverage, with general liability underwriters in full retreat, professional liability underwriters looking for double digit increases and cyber underwriters asking very pointed questions about the health system’s risk management.

Elizabeth, a strong young woman with a good support network, would eventually recover from the damage done to her.

Medwell’s relationships with the insurance markets looked like it almost never would. &

Bar-Lessons-Learned---Partner's-Content-V1b

Risk & Insurance® partnered with Allied World to produce this scenario. Below are Allied World’s recommendations on how to prevent the losses presented in the scenario. This perspective is not an editorial opinion of Risk & Insurance.®.

The use of telehealth has exponentially accelerated with the advent of COVID-19. Few health care providers were prepared for this shift. Health care organizations should confirm that Telehealth coverage is included in their Medical Professional, General Liability and Cyber policies, and to what extent. Concerns around Telehealth focus on HIPAA compliance and the internal policies in place to meet the federal and state standards and best practices for privacy and quality care. As states open businesses and the crisis abates, will pre-COVID-19 telehealth policies and regulations once again be enforced?

Risk Management Considerations:

The same ethical and standard of care issues around caring for patients face-to-face in an office apply in telehealth settings:

  • maintain a strong patient-physician relationship;
  • protect patient privacy; and
  • seek the best possible outcome.

Telehealth can create challenges around “informed consent.” It is critical to inform patients of the potential benefits and risks of telehealth (including privacy and security), ensure the use of HIPAA compliant platforms and make sure there is a good level of understanding of the scope of telehealth. Providers must be aware of the regulatory and licensure requirements in the state where the patient is located, as well as those of the state in which they are licensed.

A professional and private environment should be maintained for patient privacy and confidentiality. Best practices must be in place and followed. Medical professionals who engage in telehealth should be fully trained in operating the technology. Patients must also be instructed in its use and provided instructions on what to do if there are technical difficulties.

This case study is for illustrative purposes only and is not intended to be a summary of, and does not in any way vary, the actual coverage available to a policyholder under any insurance policy. Actual coverage for specific claims will be determined by the actual policy language and will be based on the specific facts and circumstances of the claim. Consult your insurance advisors or legal counsel for guidance on your organization’s policies and coverage matters and other issues specific to your organization.

This information is provided as a general overview for agents and brokers. Coverage will be underwritten by an insurance subsidiary of Allied World Assurance Company Holdings, Ltd, a Fairfax company (“Allied World”). Such subsidiaries currently carry an A.M. Best rating of “A” (Excellent), a Moody’s rating of “A3” (Good) and a Standard & Poor’s rating of “A-” (Strong), as applicable. Coverage is offered only through licensed agents and brokers. Actual coverage may vary and is subject to policy language as issued. Coverage may not be available in all jurisdictions. Risk management services are provided or arranged through AWAC Services Company, a member company of Allied World. © 2020 Allied World Assurance Company Holdings, Ltd. All rights reserved.




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