RMs Look To Improve Quality Survey
The Quality Scorecard, published for two years by The Quality Insurance Congress and the Risk and Insurance Management Society, was surrounded in controversy because of the negative light it cast on parts of the insurance industry.
It is being replaced by The Quality Improvement Process, also created to help risk managers make effective decisions about their brokers, as well as insurers and other service providers.
The industry "generally looked pretty bad," said Christopher Mandel, first vice president at New York-based RIMS. "I think the highest score on [the earlier] version was in the mid-70s. It confirmed what we all suspected, that the buyers view of the industry was pretty mediocre."
As a result of the ensuing conflict, he said RIMS, originally a representative in the Quality Insurance Congress, agreed to take on the survey "as a rescue from the ashes." The Quality Improvement Process will be released next year, he said.
"There was a lot of controversy around the first two versions," explained Mr. Mandel, assistant vice president, enterprise risk management at USAA, a diversified financial institution based in San Antonio. "Primarily because people didnt like their scores, I think. So they questioned the methodology and its validity."
To make the new survey more reflective of the industry's performance, he said, steps have been taken to involve industry players directly in the development of the measurement tool and the survey process. "I guess were also trying to take out of this version any level of subjectivity that others may have thought was there before," he added.
Mr. Mandel said that part of the accusation from the industry "was that this was done in a vacuum and they didnt consider the process fair." But he said that "based on the feedback were getting from those participants, we believe were on the right track."
The big challenge with the current survey is "the time frame where the industry is moving back into a hard market cycle," Mr. Mandel said. Buyers, he added, will be negatively affected by the hard market, which will only get worse.
"My opinion is that we were moving into a hard cycle, but 9-11 threw the gas on the flames," he said.
"I think its producing some extreme reactions," especially considering that the federal government will play "some significant role in underwriting the terrorist risk and keeping it away from the industry," he said, making "200-500 percent premium increases" unwarranted.
The challenge for survey respondents, he said, is to take the time needed to write a quality answer that is fair to those being assessed, "because its going to affect their business, theres no question about it," Mr. Mandel said. "Which is why they were so upset the last time."
Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, December 10, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.
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