Risk Insider: Tony Boobier

The Value of Experience

By: | May 23, 2017 • 3 min read
Tony Boobier is an experienced independent consultant focusing on insurance analytics. An international speaker, commentator and published author, he lies awake at night thinking about the convergence of insurance and technology. He can be reached at [email protected]

Over dinner I was discussing the importance of experience with professional (and senior) insurance colleagues. We spoke about new business models, blockchain, cognitive analytics, and how AI would ultimately change our industry and our professions.

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One of them raised his eyes to the ceiling. “I don’t know if experience matters any longer,” he said, and he had a point. “After all,” he went on, “aren’t we increasingly looking at the way the insurance industry operates, and tearing up the rule book?”

As Thomas Edison put it, we can keep to the rule book, or we can make progress.

I wondered afterwards about what my colleague had said, especially about the topic of experience. When I look at my own CV covering nearly four decades, it’s as if the experience gained over the first three decades is no longer relevant. Isn’t it only the most recent stuff that matters? And who really cares about hard-earned professional qualifications based on an old-school syllabus?

If knowledge is that which we believe in, then isn’t experience how we apply that knowledge?

I’m not the only one to have thought about the issue of experience. As distinct from knowledge, experience seems to be something much deeper. If knowledge is that which we believe in, then isn’t experience how we apply that knowledge?

Let’s have a quick history lesson. Knowledge, according to the philosopher John Locke (1632-1704), comprises three levels: intuition, demonstrable knowledge (where we make comparisons), and faith or opinion, which Locke accepts isn’t really knowledge at all but only something we believe in.

(By the way, Locke was around about the same time that the insurance industry as we now know it was first conceived in the coffee shops of London, but that doesn’t make him an insurance expert.)

Nowadays we often tend to equate knowledge mainly with academic and other professional qualifications, which seems to miss at least some of the point. In London, cab drivers who learn the streets of London and can navigate without Sat Nav are said to have “the knowledge.”

Locke also had something to say about experience: If we imagine the mind to be a blank piece of paper, experience is where knowledge comes from. Put another way, he said that all knowledge comes from experience. It seems that we really need to know can’t be learned in a book.

So what’s this to do with insurance? The insurance industry is continually and increasingly being challenged to revisit traditional business models, some of which are tried and tested. Disruption is the name of the game.

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Yet, Insurtech startups continually complain that more than other industries, insurance companies seem to comprise gatekeeper after gatekeeper, each being (in the opinion of these startups) ultra-cautious. “Why are insurers so slow to take on board my great idea?” they say.

Perhaps such reticence is based on the experience of an individual who intuitively isn’t certain about proposed changes, and has no option but to treat these new ideas with an element of skepticism? Or maybe it’s a byproduct of an insurance industry whose ultimate success depends on the evaluation of risk, entirely based on experience?

The impact of change will be enormous, and the consequences of failure could be expensive. But we shouldn’t forget that the insurance industry underpins the financial security of companies and individuals, and shouldn’t be attracted by bright shiny technological baubles.

More from Risk & Insurance

More from Risk & Insurance

4 Companies That Rocked It by Treating Injured Workers as Equals; Not Adversaries

The 2018 Teddy Award winners built their programs around people, not claims, and offer proof that a worker-centric approach is a smarter way to operate.
By: | October 30, 2018 • 3 min read

Across the workers’ compensation industry, the concept of a worker advocacy model has been around for a while, but has only seen notable adoption in recent years.

Even among those not adopting a formal advocacy approach, mindsets are shifting. Formerly claims-centric programs are becoming worker-centric and it’s a win all around: better outcomes; greater productivity; safer, healthier employees and a stronger bottom line.

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That’s what you’ll see in this month’s issue of Risk & Insurance® when you read the profiles of the four recipients of the 2018 Theodore Roosevelt Workers’ Compensation and Disability Management Award, sponsored by PMA Companies. These four programs put workers front and center in everything they do.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top,” said Steve Legg, director of risk management for Starbucks.

Starbucks put claims reporting in the hands of its partners, an exemplary act of trust. The coffee company also put itself in workers’ shoes to identify and remove points of friction.

That led to a call center run by Starbucks’ TPA and a dedicated telephonic case management team so that partners can speak to a live person without the frustration of ‘phone tag’ and unanswered questions.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top.” — Steve Legg, director of risk management, Starbucks

Starbucks also implemented direct deposit for lost-time pay, eliminating stressful wait times for injured partners, and allowing them to focus on healing.

For Starbucks, as for all of the 2018 Teddy Award winners, the approach is netting measurable results. With higher partner satisfaction, it has seen a 50 percent decrease in litigation.

Teddy winner Main Line Health (MLH) adopted worker advocacy in a way that goes far beyond claims.

Employees who identify and report safety hazards can take credit for their actions by sending out a formal “Employee Safety Message” to nearly 11,000 mailboxes across the organization.

“The recognition is pretty cool,” said Steve Besack, system director, claims management and workers’ compensation for the health system.

MLH also takes a non-adversarial approach to workers with repeat injuries, seeing them as a resource for identifying areas of improvement.

“When you look at ‘repeat offenders’ in an unconventional way, they’re a great asset to the program, not a liability,” said Mike Miller, manager, workers’ compensation and employee safety for MLH.

Teddy winner Monmouth County, N.J. utilizes high-tech motion capture technology to reduce the chance of placing new hires in jobs that are likely to hurt them.

Monmouth County also adopted numerous wellness initiatives that help workers manage their weight and improve their wellbeing overall.

“You should see the looks on their faces when their cholesterol is down, they’ve lost weight and their blood sugar is better. We’ve had people lose 30 and 40 pounds,” said William McGuane, the county’s manager of benefits and workers’ compensation.

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Do these sound like minor program elements? The math says otherwise: Claims severity has plunged from $5.5 million in 2009 to $1.3 million in 2017.

At the University of Pennsylvania, putting workers first means getting out from behind the desk and finding out what each one of them is tasked with, day in, day out — and looking for ways to make each of those tasks safer.

Regular observations across the sprawling campus have resulted in a phenomenal number of process and equipment changes that seem simple on their own, but in combination have created a substantially safer, healthier campus and improved employee morale.

UPenn’s workers’ comp costs, in the seven-digit figures in 2009, have been virtually cut in half.

Risk & Insurance® is proud to honor the work of these four organizations. We hope their stories inspire other organizations to be true partners with the employees they depend on. &

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]