Risk Management and Insurance Program at CU Denver

We recently met with Barbara from the CU Denver Risk Management and Insurance Program. CU's business school is one of the top ranked business schools and the Risk Management and Insurance Program is one of only a handful of programs dedicated to preparing those interested in risk management and insurance for their careers and I believe it is the only program in Colorado offering the range of options to students that it does. There are undergraduate, graduate, and certificate programs offered and we have several Pinnacol employees enrolled.

I often meet with recent graduates and sometimes ask them about what their dream job was while going through college. Many times they tell me they really didn't know what they wanted to do while in school. They often default to majoring in business because they feel this will allow them the most options. I'd encourage anyone in school to check out whether their institution offers risk management and insurance classes and if they do to take a class or two to see if it intrigues them.

When fifth grade teachers ask their students what they want to be when they grow up no one answers "I want to work in insurance!". At that age it's all about being astronauts, rock or sports stars, and the like. The CU Denver RMI website points out that there are more jobs in risk management than qualified people to fill them. Insurance employees in the U.S. are retiring at the rate of about 3,500 annually, while there are just 1,000 annual graduates with risk management degrees from U.S. universities. I think that's simply because people don't think about insurance careers and its sometimes difficult to get meaningful information about what working in this field is like.

Programs like CU's are great ways for students to explore our industry and more often than not they will be amazed at the range of career options working in insurance can offer. Pinnacol is a medium sized company but we offer career paths in everything from Information Technology to Finance, Legal to Marketing and Communications, Nursing to Underwriting and Claims.

Barbara did a nice job presenting the programs offered and if I was back in school I'd definitely be motivated to explore their offerings further! The CU RMI website lists the following ways to contact them for additional details:

• Risk Management and Insurance Program, 303-315-8153,rmi@ucdenver.edu​

Management opportunity: Business Director position now open!

Its no secret that our employees generally stay with our company longer than at many other places. The average length of service is about 10 years. According to the Bureau of Labor Statistics the median number of years that  workers had been with their current employer was 4.6 years in January 2014. While we enjoy having our employees around we do occasionally see them leave. We have a manager who will be retiring soon and that has opened up a great opportunity for an experienced insurance professional to join our company in the capacity of a Business Director, Insurance Operations. As you might imagine, this is a critical role for us so I wanted to share more information on what this position does and what we are looking for.

For this particular Business Director role a strong knowledge of the Construction industry and related accounts is desired. Accountable for leading a multidisciplinary insurance operations team of direct and in-direct reports, the Business Director establishes team priorities, team goals, and expectations to facilitate the delivery of team-based services creating a distinctive customer value proposition, and best-in-class customer experience. This position is responsible for leading the team's efforts to identify, understand, and deliver industry specific services our customers value while maintaining oversight and accountability for the team's book of business to achieve financial, business and customer objectives (underwriting profitability, growth, retention, claims management and customer experience) by routinely monitoring and directing improvement efforts to drive key performance metrics. The Business Director is responsible for creating a culture based on lean management principles, continuous learning, and improvement resulting in Pinnacol becoming Colorado's recognized customer insight leader and consistently achieving best-in-class operational performance.

Candidates should bring extensive in-depth knowledge of insurance operations (claims, underwriting and risk management services), the proven ability to coach, mentor and manage employees and have the interpersonal skills to motivate staff. Our Business Directors must also be able to negotiate and build consensus, possess strong conflict resolution and negotiation skills, and have a proven ability to resolve issues/problems to beneficial solution for internal and external customers. Being a team player with a proven ability to develop and manage relationships across a team-based organization is also required as is the ability to assess, analyze and integrate information from agents, competitors, market and industry trend data to drive strategic and tactical decisions. This position requires a minimum of a Bachelor’s degree in business administration or related field with five or more years experience in a leadership position in insurance or related field desired. If this sounds of interest we'd love to hear from you or if you know someone who might be a great fit please let them know about this great opportunity!

Combined Ratio? What the heck is that?

Every industry has it's own set of metrics and insurance is no different. I was in a meeting this morning and happened upon a new employee who had no idea what combined ratio was so after the meeting I spent some time explaining this key measure of insurance company performance. The folks at IRMI.com define combined ratio this way:

The sum of two ratios, one calculated by dividing incurred losses plus loss adjustment expense (LAE) by earned premiums (the calendar year loss ratio), and the other calculated by dividing all other expenses by either written or earned premiums (i.e., trade basis or statutory basis expense ratio). When applied to a company's overall results, the combined ratio is also referred to as the composite, or statutory, ratio. Used in both insurance and reinsurance, a combined ratio below 100 percent is indicative of an underwriting profit.

This definition is absolutely correct but unless you are an insurance professional it might as well be Latin in terms of helping folks new to our industry understand what combined ratio really means. My favorite definition, shared by a former CEO of our company, is perhaps a little simpler to understand:

The cost of claims plus operating expenses divided by premium.

 An overly simple example might help. If an insurance company has $1,000 in claims and a $1,000 in operating expenses (the light bill, salaries, overhead, etc.) and collects premium of $2,000 the combined ratio would be 100%:

($1,000 + $1,000)/$2000 = 100%

In other words, for every dollar of premium collected, the insurance company spent one dollar in combined claims and operating expense. In the example above, if the insurance company had actually collected $2,500 in premium while incurring $2,000 in claims and operating expense the combined ratio would be 80% ($2,000/$2,500) and the insurance company would have made a profit of 20 cents on every dollar. Conversely, if the insurance company had only collected $1,900 in premium the combined ratio would have been 105% which means the insurance company would be spending 5 cents more on claims and operating expense than it was collecting per dollar of premium. 

Its important to realize that insurance companies can still make money even if their combined ratio is higher than 100%. If you know how you are probably already working in the insurance industry but for those who don't know the answer, it's not complicated or rocket science. The dollar of premium collected by the insurance company doesn't immediately get spent on claims or operating expense. Until it does get spent that dollar is being invested and as long as the return on the investment is greater than the extra 5% in the 105% example above the insurance company still makes money. 

Insurancejournal.com indicates that the combined ratio for the workers' compensation insurance industry in 2013 was 101%. That said, combined ratios vary dramatically between companies and even between states. Our employees are kept aware of Pinnacol's combined ratio as one measure of how we are doing as a company but for new employees, as for those outside our industry, it is sometimes challenging to understand what some of these metrics mean and why they are important!

New Training Class for Claims Representatives set to start!

We are starting another Claims Training Program and are interested in hearing from candidates interested in beginning (or continuing) a career in claims adjusting. Colorado's economy continues to grow and the state's employers are adding employees. A side effect of this is that even if the frequency of claims remains the same with a larger workforce you'll still see more people getting injured on the job simply because there are more people working. Pinnacol's Claims Representatives are responsible for helping these injured workers navigate their benefits through their employer's workers' compensation insurance coverage. We are going to be starting up another training program for entry level Claims Representatives and are looking for candidates interested in beginning (or continuing) an insurance career in this role. 

Claims and underwriting are the two things at the heart of what every insurance company does - whether selling pet insurance, life insurance, auto insurance, or property and casualty insurance. Obviously there are many other types of jobs with insurance companies but these are the two major career paths and there are definite differences between them both in terms of the actual work done but also in the unique challenges and job satisfaction they offer. 

Claims is where the rubber hits the road - it's where the risk that was analyzed and forecast by the underwriters becomes reality. In our world of workers' compensation its where we get to help folks who really need us. No one wants to be injured on the job and it can be a scary and challenging situation. Our Claims Representatives have to do a lot of education, investigation and consultation with injured workers, policyholders, and medical providers while continuing to move the claim toward a successful outcome. 

If exploring this type of role sounds interesting we'd love to hear from you! As this is a professional position, entry level Claims Representatives with no claims experience do need to have a Bachelors degree. For those with existing claims experience we can take that into account in lieu of the formal degree. As always, if you are interested we ask that you please apply via our company website. 

100 Year Celebration goes ahead without a hitch

Despite some threatening clouds this morning Pinnacol employees were treated to surprisingly good weather for today's celebration of our company's 100 year anniversary. The event, held outdoors in our parking lot, featured catered lunch for our employees as well as for our invited guests including company retirees, former and present board members, and two of our former CEO's. I heard, but haven't verified, that there may have been 60 or more retirees in attendance. The event was a true blending of the best of the past with the best of the present all wrapped up in the promise of the future. Our former Chief Financial Officer, Jeff Tetrick, who retired after 25 years of service, had the honor of opening the time capsule which had been buried when we moved into our Lowry facilities. That was appropriate as it was in large part due to Jeff's efforts that the relocation to Lowry happened at all.

It was a special treat to have three CEO's in attendance - Gary Pon, John Plotkin, and Phil Kalin. It's not often that happens and it was a pleasure to see them together. Gary Pon was tasked with transitioning the then State Compensation Fund away from State agency status and he oversaw us as we became the State Compensation Insurance Authority, then the Colorado Compensation Insurance Authority, and finally Pinnacol Assurance. Gary received a very warm reception and recognition from our employees as well as from our current CEO Phil.

Companies only turn 100 once, and then only if they are fortunate enough to make it to that milestone. Through those 100 years there have been several thousand Coloradans who have worked for our company and it is through their efforts, as well as the ongoing work of our current employees that make Pinnacol the company it is today. It is a privilege to live and work in this great State and we look forward to serving the people of Colorado well into the future.

Pinnacol's parking lot was transformed to celebrate our 100 year anniversary

Preparing to unlock the time capsule

Past meets present: former CEO Gary Pon and current CEO Phil Kalin

Pinnacol employees and guests pose for 100 Year pictures

Flashback 2002

On November 12, 2002, a time capsule was buried on the grounds of the brand new Pinnacol headquarters at Lowry. Tomorrow, July 7, 2015,  that time capsule will be opened after 13 years underground to help celebrate our 100 year anniversary.  In honor of this event I went ahead and researched some of the coolest things of 2002, because who knows, maybe some of these items are in the time capsule!

Coolest things in 2002: 

·       Trucker hats

A long time before
  Two and a Half Men

·       BlackBerry smartphones                          

·       Gen 2 iPods

·       Crocs

·       TiVo Series2

·       Xbox was introduced

·       PlayStation 2 was the bestselling video game console with Grand Theft Auto Vice City being the top game

·       Yu-Gi-Oh game cards

·       Ford F-series

·       Bleached hair/Chunky highlights

·       Sweat/track suits   

                                   

While some of these cool 2002 things may or may not be in the time capsule, there were also some pretty significant events that happened in 2002.

               Things that happened in 2002:

·       George W. Bush was President      

·       A gallon of gas averaged about $1.34

·       The most popular baby names in 2002 were Emily, Jacob, Madison and Michael

·       Spider-Man (the 1^st one) was the biggest blockbuster of the year

·       The Patriots beat the Rams in the Super bowl

·       The Anaheim Angels and Los Angeles Lakers are Champions

·       Tiger Woods wins his second consecutive Masters

·       Elizabeth Smart was kidnapped,  but was found safe in early 2003

·       Kelly Clarkson wins the first American Idol contest      

·       J.Lo (Jennifer Lopez) is named by Forbes as the most powerful Celebrity in the World

·       Miss America was Katie Harman from Ohio                   

·       Steve Fossett finished his non-stop trip around the world via balloon on July 4th. It took him 14 days, 19 hours and 51 minutes

·       Forest fires in Colorado have destroyed nearly 100,000 acres of land making them the worst in the state’s history. 
·       Scientists compare mouse and human genomes. The first analysis of two complete genomes reveals striking similarities. Scientists hope findings will hasten understanding of genetic diseases

While I seriously doubt there will be a trucker hat or a Gen 2 iPod or even a pair of crocs in the time capsule, it is possible we will see images of some very important things that happened in 2002. There could be newspaper articles or magazines. It is possible there could be an old Pinnacol shirt in there. It is also possible that those fashion trends we have grown to cringe about could be captured in photos left in the capsule. While Pinnacol has a 100 year history, whatever is in the time capsule (I pray there are not bugs!), will be displayed to see how far we have come in just 13 short years.

 -Alyson 

Our intern Alyson in 2002...

Alyson in 2015