There's a reason midsummer is often referred to as the "dog days": It's called heat, pure and simple. Heat makes you sluggish, gives you a whole new perspective on the practicality of afternoon siestas and generally lowers your energy level from Ten Years After to Mungo Jerry. (Where the term "dog days" came from is another column for another time. Check back next year!)
So, now is a perfect time of year to kick back with a chilly glass of lemonade and enjoy a good read. I've been wending my way through the latest Jeff Shaara book, "The Steel Wave." It's the second of his planned World War II trilogy, this one focused on the preparations for and implementation of D-Day.
Shaara's specialty is historical fiction. Not the "let's take a good story and set it in medieval England" type, but a highly skilled art form brought to fruition in his father Michael's Pulitzer Prize-winning "The Killer Angels," which for my money may just be the best book about the Civil War ever written.
Shaara's method is to take historical events and personalities and tell their story by putting you into their heads. While the facts and events are verifiable, obviously we don't know exactly what was going through a specific person's mind at a specific moment, but through meticulous research Shaara makes his best guess and tells the story as if his suppositions were real. He takes pains to stress his ideas are conjecture, and although massive research goes into his work, it's still fiction. His books are great stories by a great storyteller.
If only insurance folks could navigate that potential conundrum so impressively. Judging by a veritable plethora of questions crossing the radar lately, "opinions" and "theory" are far too often presented as "fact," to the confusion and detriment of us all. And the real danger arises when these supposed facts are then used as the basis for coverage decisions, to the detriment of unsuspecting insureds. Alas, this is often how our advice and counsel morphs from nectar of the gods (for our clients) to chum for the sharks (attorneys).
A key example arose last week. A company underwriter e-mailed me the following (edited for brevity and to remove identifying information):
Mixed responses? Guessing? My response (also edited):
The Iowa example he refers to appeared in my November 2004 AAB column. Due to an outpouring of questions such as his, I did a follow-up article in January 2005, which presented essentially the same conclusion as my response above. This is one case where it would seem the facts are clear, the answer obvious. Yet almost four years later, the debate apparently continues. (Doesn't everyone read my column?) I love "I'm guessing the answer is yes." Guessing? Given the policy language, the answer is definitely yes, and the policy also has a clear audit provision allowing the carrier to go back and collect all the proper premiums due.
So what's the problem? This: There are more than a few folks out there who look at these facts and basically dismiss them along the lines of "that just doesn't make sense," or "I know what it says, but I'm not sure I believe it." (To which I say, "Welcome to insurance!") And if they're unhappy with certain insurance facts, they're certainly entitled to their opinion.
But the danger arises when folks go on to present those opinions as if they were facts. Conjecture and opinion--using your brain--are admirable skills, but Shaara has the key: Clearly separate the facts from the conjecture, and label them accordingly. Just a simple "of course, I may be wrong" when presenting personal beliefs would go a long way toward putting the listener or reader on notice that the preceding was a judgment or conjecture, not biblical truth. Until that day, unsuspecting readers and students can certainly be forgiven for getting confused and continuing to waste valuable time and effort, while increasing their risk of E&O, acting on mistaken beliefs in areas that should be a done deal.
An old compatriot of mine named Preston Matthews dubbed this acceptance of opinion as fact "knowledge by folklore." I love it! Next time a coworker or industry pundit states a guessed-at possibility as gospel truth, ask where this gem of wisdom was acquired. Don't be surprised when few give a factual response, such as "I read it in the policy." You're far more likely to hear one of the following folklorish responses: "Oh, I heard it in a class." "A guy I used to work with told me." "Everybody knows that!" "I read it in an article somewhere." Or one I'm personally extremely sensitive to, "The instructor said so--I have it in my notes."
There's more than enough complicated and confusing material in insurance to keep us busy the rest of our lives. Can't we lighten the load a bit by putting the easy and clear stuff to rest? If not, eventually the facts and opinions begin to meld and blur until everything seems negotiable and nothing is certain. While that may be fine in the world of fiction, in an industry that supposedly exists to increase the level of certainty perhaps Bruce Springsteen best described the inevitable, heartbreaking result: "God have mercy on the man who doubts what he's sure of."
Speaking of great rock guitarists, check out Eric Clapton's autobiography, "Clapton." It's an incredible read of an incredible life. Of course, I may be wrong.
But I'm not.
Chris Amrhein is an insurance educator and speaker with more than 30 years in the industry. He is also chief fun officer of www.insuranceisfun.com, where his newest book of insurance musings, "Yes, Virginia, There is Insurance," is now available. Readers may contact Chris at chris@insuranceisfun.com.
So, now is a perfect time of year to kick back with a chilly glass of lemonade and enjoy a good read. I've been wending my way through the latest Jeff Shaara book, "The Steel Wave." It's the second of his planned World War II trilogy, this one focused on the preparations for and implementation of D-Day.
Shaara's specialty is historical fiction. Not the "let's take a good story and set it in medieval England" type, but a highly skilled art form brought to fruition in his father Michael's Pulitzer Prize-winning "The Killer Angels," which for my money may just be the best book about the Civil War ever written.
Shaara's method is to take historical events and personalities and tell their story by putting you into their heads. While the facts and events are verifiable, obviously we don't know exactly what was going through a specific person's mind at a specific moment, but through meticulous research Shaara makes his best guess and tells the story as if his suppositions were real. He takes pains to stress his ideas are conjecture, and although massive research goes into his work, it's still fiction. His books are great stories by a great storyteller.
If only insurance folks could navigate that potential conundrum so impressively. Judging by a veritable plethora of questions crossing the radar lately, "opinions" and "theory" are far too often presented as "fact," to the confusion and detriment of us all. And the real danger arises when these supposed facts are then used as the basis for coverage decisions, to the detriment of unsuspecting insureds. Alas, this is often how our advice and counsel morphs from nectar of the gods (for our clients) to chum for the sharks (attorneys).
A key example arose last week. A company underwriter e-mailed me the following (edited for brevity and to remove identifying information):
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Enjoyed your writings re: any auto coverage, and had a quick question to hopefully clear up a debate that we have at [carrier]. In Section I, Paragraph B of the BAC: "Owned Autos You Acquire After The Policy Begins 1. If Symbols 1, 2, 3, 4, 5 or 6 are entered next to a coverage in Item Two of the Declarations, then you have coverage for 'autos' that you acquire of the type described for the remainder of the policy period. 2. But, if Symbol 7 is entered next to a coverage in Item Two of the Declarations, an 'auto' you acquire will be a covered 'auto' for that coverage only if: a. We already cover all 'autos' that you own for that coverage, or it replaces an 'auto' you previously owned that had that coverage; and b. You tell us within 30 days after you acquire it that you want us to cover it for that coverage." Would "policy period" be for the remainder of that policy term during which those vehicles were acquired, or as long as that carrier has a policy covering the insured? We've gotten mixed responses from agents, legal, etc. So in your "Iowa" story example, if I have a Symbol 1 liability policy that expires May 1, 2009, and acquire 200 vehicles today, I agree that those vehicles are covered through May 1, 2009. What happens if those vehicles aren't scheduled and the policy renews? Are those 200 vehicles covered for liability? I'm guessing the answer is yes, that carriers can go and get the premium back with a premium audit. |
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Maybe the answer is just too simple for most insurance folks, who are often raised to think of coverage as a vast, complicated morass only truly decipherable by the enlightened few. In this case, the policy language clearly states "any auto" is covered, without limitations beyond the exclusions. So here is how I think it operates: Your current policy: Symbol 1. 200 vehicles acquired during policy period = clearly covered. Renewal date arrives. New policy is issued with Symbol 1. "Any auto" is now covered--which clearly includes the 200 new vehicles. To those who disagree, I simply ask to show me in the policy any provision that states otherwise. The "Owned Autos You Acquire After the Policy Begins" provision is a clarification of the broadening effect of the automatic symbols versus Symbol 7, but there is no equivalent limiting language that then takes away the automatic coverage at renewal. Given that the vehicles are automatically covered by the Symbol 1, and there is no limitation or exclusion removing those currently owned vehicles, the symbol means just what it says--any auto--and the renewal covers the 200 cars. Note the same is true if you used any of the automatic symbols. One exception to the above is the policy's fraud and concealment provisions. If either the insured or agent were asked if there were any undeclared autos, and it could be proven they deliberately lied to the carrier, then all bets--and coverage--are off. Absent specific and provable intent to defraud, which is unlikely, using any of the automatic symbols means the policy clearly provides coverage on currently owned as well as newly acquired vehicles. Or as my mother might have said, "What part of 'any auto' don't you understand?" |
So what's the problem? This: There are more than a few folks out there who look at these facts and basically dismiss them along the lines of "that just doesn't make sense," or "I know what it says, but I'm not sure I believe it." (To which I say, "Welcome to insurance!") And if they're unhappy with certain insurance facts, they're certainly entitled to their opinion.
But the danger arises when folks go on to present those opinions as if they were facts. Conjecture and opinion--using your brain--are admirable skills, but Shaara has the key: Clearly separate the facts from the conjecture, and label them accordingly. Just a simple "of course, I may be wrong" when presenting personal beliefs would go a long way toward putting the listener or reader on notice that the preceding was a judgment or conjecture, not biblical truth. Until that day, unsuspecting readers and students can certainly be forgiven for getting confused and continuing to waste valuable time and effort, while increasing their risk of E&O, acting on mistaken beliefs in areas that should be a done deal.
An old compatriot of mine named Preston Matthews dubbed this acceptance of opinion as fact "knowledge by folklore." I love it! Next time a coworker or industry pundit states a guessed-at possibility as gospel truth, ask where this gem of wisdom was acquired. Don't be surprised when few give a factual response, such as "I read it in the policy." You're far more likely to hear one of the following folklorish responses: "Oh, I heard it in a class." "A guy I used to work with told me." "Everybody knows that!" "I read it in an article somewhere." Or one I'm personally extremely sensitive to, "The instructor said so--I have it in my notes."
There's more than enough complicated and confusing material in insurance to keep us busy the rest of our lives. Can't we lighten the load a bit by putting the easy and clear stuff to rest? If not, eventually the facts and opinions begin to meld and blur until everything seems negotiable and nothing is certain. While that may be fine in the world of fiction, in an industry that supposedly exists to increase the level of certainty perhaps Bruce Springsteen best described the inevitable, heartbreaking result: "God have mercy on the man who doubts what he's sure of."
Speaking of great rock guitarists, check out Eric Clapton's autobiography, "Clapton." It's an incredible read of an incredible life. Of course, I may be wrong.
But I'm not.
Chris Amrhein is an insurance educator and speaker with more than 30 years in the industry. He is also chief fun officer of www.insuranceisfun.com, where his newest book of insurance musings, "Yes, Virginia, There is Insurance," is now available. Readers may contact Chris at chris@insuranceisfun.com.
