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A MADISON COLLEGE PUBLICATIONA MADISON COLLEGE PUBLICATION

Is TODAY’S INSURANCEINDUSTRY PREPAREDFOR TOMORROW?

INSURANCE FRAUD

TIPS VOICES

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T o m o r r o w ’ sI n s u r a n c e

P r o f e s s i o n a l sISSUE 1 | APRIL 2012

T o m o r r o w ’ sI n s u r a n c e

P r o f e s s i o n a l s

Is TODAY’S INSURANCEINDUSTRY PREPAREDFOR TOMORROW?

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AAA salutes the Insurance & Risk Management Program of Madison College for making a difference.

AAA is proud to support initiatives that strengthen our community. By pooling our talents and resources, we can build a more fulfilling future.

CongRAtulAtIons on beIng A

DRIVIng FoRCeIn ouR CoMMunIty

YOUR AD HERE

SUPPORT STUDENTS AND ADVERTISE IN THE OCTOBER ISSUE OF TIPS

CONTACT MADISON COLLEGE,

INSURANCE AND RISK MANAGEMENT PROGRAM

I N S I D E F R O N T C O V E R I N S I D E B A C K C O V E R

D O N O R STHANK YOU TO OUR DONORS WHO SUPPORT THE INSURANCE & RISK

MANAGEMENT PROGRAM’S EFFORTS AND WHO HAVE SUPPORTED

THE STUDENTS THROUGH THEIR FINANCIAL GIFTS:

AAA Wisconsin

Celerity Staffing Solutions

Community Foundation of the Fox Valley Region

Delta Dental of Wisconsin

EMC Insurance Companies

Frankenmuth Insurance

Germantown Mutual Insurance Company

Liberty Mutual Group

M3 Insurance

Steven Murphy

Swett & Crawford

UNUM Group

West Bend Mutual Insurance Company

Wilson Mutual Insurance Company

Wisconsin Chapter Risk & Insurance Management Society, Inc.

Wisconsin Public Risk Management Insurance Association

I N S U R A N C E A D V I S O R Y C O M M I T T E EA SPECIAL THANKS TO THOSE WHO DONATE THEIR TIME

AND WISDOM TO MAKE THIS PROGRAM POSSIBLE:

Chair: Heidi Nienow Regional Sales Director, Independent Agents, AAA Wisconsin

Secretary: Diane Wilkinson VP Client Services, M3 Insurance Solutions for Business

Student Representative: Claire Gribble Student, Madison Area Technical College and Intern, Neckermann Insurance Services

Kay Abel Agency Owner and Alumni, Abel Insurance Associates, Ltd.

Roger Baker Learning Consultant, CUNA Mutual Insurance Company

Anne Bell Learning Alliances Specialist, American Family Insurance Company

Diane Dillett Agency Owner, The Dillett Company

Dan Edge VP Medical Affairs, WPS Health Insurance

Roger Frings Policy Initiatives Advisor, Office of the Commissioner of Insurance

Ryan Jones Staffing Specialist, Celerity Insurance Staffing

Jim Kuerschner Corporate Sales Manager, Society Insurance Company

Steve Murphy President/Alumni, Murphy Insurance Group

Ross Squires Commercial Agent, Hausmann-Johnson Insurance

Ron Vermillion VP Marketing, Germantown Mutual Insurance Company

Allan Wearing Sales & Marketing Director, Group Health Cooperative of South Central Wisconsin

Dr. Bettsey Barhorst President

Terry Webb Vice President, Learner Success

Turina Bakken Associate Vice President, Learner Success

Robert Dinndorf Executive Director, Foundation

Denise Reimer Interim Dean, Business & Applied Arts

Bryan Woodhouse Interim Dean, Business & Applied Arts

Martha Lester-Mittenzwei MBA, AAI, AIC, CIC, Insurance & Risk Management Program Director

TIPs is issued 3xs annually, February, April, and October. All profits are returned to the Insurance & Risk Management Scholarship and Professional Development Fund for students.

To support and encourage the students through advertising, contact Martha Lester-Mittenzwei, Insurance & Risk Management Program Director, mlester-mittenz@matcmadison.edu or 608-243-5417 for information and rates.

Volume 001 Copyright 2012

http://matcmadison.edu/program-info/insurance-certificate

Follow the students on Facebook: Insurance & Risk Management Program, Madison College

Disclaimer:The information provided in the articles is based on students’ learning and interpretation and does not constitute legal advice. Readers are advised to conduct their own due diligence on information prior to implementation or reliance upon any material provided.

Cover Image: © Michael Flippo | Dreamstime.com

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Is today’s insurance industry Prepared for Tomorrow

Insurance fraud, wisconsin tort reform, and madison college

putting risk management to practice

Establishing Accurate claims reserves

TIPs Voices

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10-13use of analytics at the strategic level 14

REAL WORLD SMART 15fall schedule of classes 18

Welcome to our fi rst edition of TIPs, a magazine about Tomorrow’s Insurance Profes-sionals. We are so excited to launch this informa-tional magazine that is written by Insurance & Risk Management students and designed by Graphics students at Madison Area Technical College. The magazine will be issued three times per year, April, October, and February. Each issue will have a dif-ferent theme. Our introductory issue, describes our program, our students, and what they are learning.

The magazine not only gives the students something to be excited about but it is an oppor-tunity to showcase their learning and share their inspirational stories. Plus, all profi ts from the mag-azine will go back to support the students through

scholarships and funding for insurance and risk management professional development.

We are very thankful to Ingrid Slamer and the Fall 2011 Electronic Page Layout class, who took on concepting a design for our magazine. There were twenty three student design submis-sions from the class. Each one was so unique and incredibly creative. Ethan Frame won the vote for this design, and the Spring 2012 Electronic Page Layout students helped put the fi rst issue together.

Neither this magazine, nor our program, would be a success without the support of our donors, advertisers, and our Advisory Committee. To them, we owe a very special Thank You!

Please enjoy.

T o m o r r o w ’ s I n s u r a n c e P r o f e s s i o n a l s

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training of new talent must also change. A four-hour lecture, followed by a test, on any insurance or risk management topic is not going to get some-one excited about a career. The state-of-the-art automation available at Madison Area Technical College, along with the support of both insurance and risk management professionals, has allowed Madison College to build a program that is educa-tional, interactive, and unique.

The Insurance & Risk Management Program at Madison College

Launched with the Fall Semester of 2009, the Insurance & Risk Management Certificate utilizes accelerated learning to provide students with a basic understanding of the insurance industry and its products to enable entrance into the insurance and risk management workforce. Our partner-ship with industry employers allows us the ability to make students aware of internship and full time employment opportunities.

The certificate includes 11 credits of core insurance courses and 6 elective credits from the Property and Casualty, Life and Health, or Risk Management areas to enable student specializa-tion with a total of 17 credits. Madison College stu-dents working towards a degree in Business Man-agement or Finance can earn their degrees with an Insurance & Risk Management Emphasis by com-pleting 6 credits from a select list of insurance and risk management classes.

This series of courses is a great addition for those who already have earned a Bachelor’s Degree and would like a specific focus in insur-ance. Students who have experience in a different industry, and are interested in a career change, will find this program is an efficient and effective method to gaining insurance knowledge. Current or returning students with an Associate’s Degree will also find this certificate an efficient pathway into the insurance industry.

… the insurance industry would lose about 1.3 million people between 2008 and 2028 due to baby-boomer retirements

Pre-Licensing & Continuing Ed

All of the pre-licensing courses (Property, Casualty, Life & Health) meet the State of Wiscon-sin’s requirements for Pre-Licensing Education and allow a blend of on-line and classroom hours. Many of the insurance and risk management courses qualify for continuing education cred-its for licensed intermediaries in Wisconsin. Stu-dents searching for continuing education that will enhance their background, broaden their knowl-edge, and add credentials to their resume will find these classes very beneficial. Industry profes-sionals are also welcome to join the designation program courses to aid them in preparing for the national exams. Upon completion of courses from The Institutes and LOMA, students can take the proctored national exam right on campus.

The Program Goals

The Insurance & Risk Management Program strives to build an exciting, interactive, real-world learning environment that creates an interest, enthusiasm and entry way for students into the insurance and risk management industries.

Information on the Insurance & Risk Manage-ment Certificate, and individual course offerings, can be found at http://matcmadison.edu/program-info/insurance-certificate. Follow the program on Facebook; Insurance & Risk Management Pro-gram, Madison College.

Martha Lester-Mittenzwei is the Insurance & Risk Manage-ment Program Director. An alumnus of Madison College, Martha returns with over 30 years of industry experience and a Masters of Business Administration, with a double emphasis in Insurance & Risk Management and Human Resources, from Concordia University. She has earned her Associates in Claims, Accredited Advisor in Insurance, and Certified Insurance Coun-selor Designations. Martha can be reached at 608-243-5417 or email mlester-mittenz@matcmadison.edu.

According to the Bureau of Labor Statistics, Career Guide to Industries 2010–2011 Edition, the Insur-ance Industry had approximately 2.3 million jobs in 2008. 61% of those were with insurance compa-nies and the balance was with insurance agencies, brokerage firms, and providers of other insurance related services. Nationally, the average annual wage of non-supervisory employees in insurance was $44,564 compared to $31,615 for other private industry occupations in 2008. In Wisconsin, a state with the 6th-largest concentration of insurance companies, the 2010 average annual insurance industry salary was $60,683 compared to $39,562 for all other workers, according to Wisconsin’s Office of the Commissioner of Insurance.

In a 2008 article by Dennis Pillsbury in Rough Notes, “The War for Talent,” the author stated the insurance industry would lose about 1.3 mil-lion people between 2008 and 2028 due to baby-boomer retirements. The numbers are incredibly surprising. A study by Deloitte Consulting, LLP, Generational Talent Management for Insurers: Strategies to Attract and Engage Generation Y in the U.S. Insurance Industry, shows that the major-ity of underwriters, adjusters, and salespeople are 40 or older.

With great earnings potential and employment opportunities available, why aren’t students lining up by the thousands to pursue a career in insur-ance or risk management? One reason may be a lack of available insurance and risk-management programs. In 2009, IRMI (International Risk Man-agement Institute) listed colleges and universities nationally with studies available in this industry. The list contained thirty names.

The biggest reason is more than likely a lack of understanding of the career potential and opportunities available. How many current indus-try employees ever planned on insurance as a career? In a generation of students that are mak-ing informed choices about their future, more of an effort has to be put into highlighting this great industry. That was the reason Madison College’s President, Bettsey Barhorst, recommended the addition of the Insurance & Risk Management Cer-tificate Program.

We’ve Come A Long Way

When we look at the changes the industry has gone through since 1688, when merchants, ships’ owners and their captains met for coffee on Tower Street in London, to insurance practices today, we can certainly say we’ve come a long way. A shorter look, from the policy-typing pools, hand or mail delivery of applications, accepting cash pay-ments, and filing paper files in the 1970s to today’s automated processes, shows dramatic changes in the way customer service is provided, claims are handled, premiums are determined, and financial stability is managed.

With so many changes behind us and con-tinued business advancement in front of us, the

…more of an effort has to be put into highlighting this great industry.

Is Today’s Insurance Industry Prepared for Tomorrow?Martha Lester-Mittenzwei INSURANCE AND RISK MANAGEMENT PROGRAM DIRECTOR

F O C U S O N T H E F U T U R E

used by the court to impart the law in civil wrongs, other than breach of contracts. The new legisla-tion clarifies many fuzzy areas that were part of the previous bill and caused problems during liti-gation because of the lack of clarity. Among the more notable reforms in the new bill that were mentioned, was the addition of clear limits for punitive damages. The bill limits punitive damage awards to the greater of two times the compensa-tory damages or $200,000. The new bill applies to cases after its publication on February, 1st 2011.

Madison College

The lunch ended with a cordial note from all attendees and with very positive remarks from the Madison College audience in regards to the

experience and exposure acquired during the event. The field trip was organized by Martha Les-ter-Mittenzwei, Director of the Insurance & Risk Management Program at Madison College.

Columba recently completed Pre-Licensing Education at Madison Area Technical College and passed the state exam for her Property & Casualty Insurance License. She is currently taking Introduction to Loss Investigation (AIC33). Columba’s previous experience has been 15 years working on world-wide insurance programs, as a bi-lingual Customer Service Manager, for Marsh Brockman and Schuh in Mexico. She enjoys working with people and developing long term relationships. Columba is looking for employment in the Madi-son area in property and casualty customer service or claims.

Putting Risk Management to PracticeRobert Ness INSTRUCTORIn the Assessing and Managing Risk course, part of the Insurance Certificate program, students learn how to manage the hazard risks that face every company big or small. There are six key steps to the traditional risk management process. The steps range from identifying potential risks to finding solutions to minimize those risks. One way the stu-dents of this course learn to apply their new skills is by visiting an actual business or organization and identifying some of the property and liabil-ity risks that are unique to that business. They are then required to identify loss control efforts that the business currently uses and any recommendations that the students might suggest.

Photos of risks and loss control efforts of a major home improvement store are shared with the class which gets them prepared to do the assign-ment. Students are encouraged to come up with a business or organization that has some unique or interesting risks. Every semester seems to bring a new mix of risks. The fall semester included a new and used goods retailer, a church, a major state public building, and a showboat of all places! Stu-dents often choose a business or organization that they know they can get an up close look at, a place where they know someone on the inside. This also keeps them from looking too much like they are “casing the joint”!

Property risks are often the most obvious ones to identify, property that can be easily dam-aged, high valued, or hard to value. Identifying some unique liability risks can be a bit more dif-ficult. Slip and fall hazards in high traffic areas are a liability risk that students usually notice.

The students often say that they find it harder to come up with loss control recommendations above the obvious ones that a typical smart busi-ness would already have in place. One recent student who selected their own place of worship was excited to share their recommendations to the church insurance committee, which she par-ticipates in. Other students who have surveyed a business where they currently work were excited to share their findings with their employer.

Photos are highly encouraged to enhance the presentation to the class that is expected. The presentation often leads to a fun discussion among the students over the risks found and some of the risks and solutions not originally identified by the presenting student. The big take away, stu-dents always seem to mention, is this is a fun and interesting way to apply the skills they are learning in the risk management course.

Bob is a Corporate Risk Manager for American Family Insur-ance and teaches Assessing and Managing Risks part time for Madison College. The course utilizes the study materi-als and text for Associate in Risk Management (ARM) 54. Bob holds a Bachelor of Business Administration Degree in Marketing and Insurance from the University of Iowa along with his Associate In Risk Management (ARM) and Chartered Property Casualty Underwriter (CPCU) Designations.

Insurance Fraud

John Kloc, SIU director with Sentry Insur-ance, was the speaker of the first topic. During his presentation, John discussed his findings from the analysis of the data provided by the National Insurance Crime Bureau about fraud. The analysis was based on the last 3 years of fraud data (2009, 2010 and 2011). Some of the most interesting find-ings are summarized here.

The number of fraudulent Fire/Arson claims has decreased over the last 3 years. This is impor-tant because historically there is a direct cor-relation between the increase of the number of fraudulent fire claims and harsh economic times. People in financial trouble may resort to burning their houses, to obtain money from their insur-ance, so they can pay their debts.

The number of Workers Compensation (WC) claims, overall, has not seen significant change. This stabilization suggests that people are not tak-ing on more risky behavior in the workplace.Injury/Unrelated fraudulent claims in WC have increased. Most of the fraudulent claims come from people that get injured during their free time. This num-ber cannot be directly related to a bad economy. However, there may be a correlation between the

type of injury and the need to continue to receive weekly compensation during recovery.

The speaker concluded the presentation explaining that the increase in fraudulent claims is not only caused by harsh economic conditions but some other factors like a shift in population val-ues, political beliefs, and how the government and society assist their fellow citizens. The Insurance industry is taking the necessary steps to prevent or reduce fraud in the early stages by implement-ing new technologies and making use of informa-tion available on social networks.

Tort Reform

The speakers for the second part of the ses-sion were Jeff Davis and Patrick Nolan. They are both partners of the Law firm Quarles & Brady LLP, which is based in Milwaukee. As law experts they focused on Insurance litigation and the “Tort Reform Bill”. On the insurance litigation side, Jeff and Patrick presented some of the most interest-ing insurance court cases and resolutions that occurred during 2011. The point of presenting these cases to the audience was to provide some legal resources for the insurance industry mem-bers. The cases can be reviewed to determine the appropriate criteria for the interpretation and reso-lution of similar controversies.

The lunch was finalized with a presentation of the “Tort Reform Bill”. The Bill was approved in 2011, and it contains a group of modifi-cations for the criteria and methodologies

Insurance Fraud, Wisconsin Tort Reform, and Madison College Columba Mendoza

On February 15, 2012, the students of the Madison Area Technical College Insurance & Risk Management Program were invited by RIMS (Risk and Insurance Management Society) and CPCU

(Chartered Property Casualty Underwriters) to their joint business lunch. During this lunch, members of different fields of insurance interchanged ideas and discussed some of the topics that affect the industry. The topics of the day were “The increase of insurance fraud is not directly related with current economi-

cal situation of the country” and “New changes in legislation affecting policy interpretation”.

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The loss ratio method, which creates total reserves for all claims within a type of insurance, is used by the actuarial depart-ment when other methods of creating reserves are insufficient. When a claim is reported after the policy expiration date for a medical malpractice claim, the company may choose to use this type of reserve.

Stair-stepping, increasing reserves only as payments are being made on the file, should be avoided. This does not provide an accurate picture of the loss potential. Reserves should be increased or decreased as new information is obtained that gives reason to believe the payout will be different than originally anticipated.

Each one of these methods has its appropri-ate time to be used based on the claim facts and claim representative’s experience. Insurers may use all or just a few of the methods depending on their procedures. Nevertheless, establishing claim reserves with a certain level of accuracy remains a very important part of the claim adjuster’s role.

Nicole took and passed the national Associate in Claims (AIC) 33 exam, upon completion of the course. She is presently employed in a claims environment and took the Introduction to Loss Investigation course to gain a better understanding of claims overall.

GERMANTOWN MUTUALINSURANCE COMPANY

W209 N11845 Insurance Place PO Box 1020Germantown, WI 53022-8220

Phone (262) 251-6680 Fax (262) 623-3130

www.gmic.com

SERVING POLICYHOLDERS AND INDEPENDENT AGENTS IN WISCONSIN SINCE 1854

Reserves are a dollar amount that an adjuster sets aside for a claim file, estimating the amount of money the insurance company will pay out for a particular loss. Establishing this value, within reason, is a very important task for the adjuster. A reserve represents a dollar amount of money the insurance company owes to another party, but has not yet been paid, and therefore impacts the insurer’s financial status. Companies may vary on the method they use, however, there are a few common processes.

The individual case method is used based on the claim representative’s experi-ence in handing similar claims. For exam-ple, if the claim representative handles only property damage claims, they would investigate the amount of damage and deter-mine what the amount will be paid based on their knowledge from previous similar claims. Some factors claim representatives may consider for this reserve method on a bodily injury claim are claim-ant information (age, gender, occupation), nature and extent of the injury (permanent injury, pain and suffering), special damages (expected medical bills, wages lost), claimant representation (lawyer representation, typical value of local court ver-dicts), liability factors (compensatory and punitive damages), and miscellaneous factors (drinking or drug use involved, economic conditions).

The roundtable method, which uses the agreement of two or more claim personnel that have reviewed the claim. This method is not the most suitable method as it is time-consuming.

Claim personnel will review and discuss the claim and come to an agreement on a reserve, or aver-age the figures discussed. This reserve method may be used when a claimant or insured has more serious medical expenses than originally expect-ed, i.e. enters a coma from a car accident.

The average value method uses a fixed dol-lar amounts that is established for certain types of claims. This method is usually based on facts from previous claims and will reflect current situations. An example may be when an insured typically sets minor bodily injury claims at $4,500 based on pre-vious experience with those types of claims, the claim representative will use set the initial reserve with this dollar amount. It may be increased or decreased later as new information is obtained.

The formula method is another approach claim representatives may use in setting reserves. The formula method uses a mathematical calculation. Insurers establish the formula that the claims staff uses based on the claim facts and type of loss. It is frequently used to determine the amount paid out for additional living expenses under a home-owner’s policy. Generally, it would be determined based on a percentage of structural damage.

The expert system method can also be used. This is done via a software application that will estimate losses and loss adjustment expenses, once the adjuster enters the details. The claim representative will set their initial reserves based on the numbers the software pulls from previous similar claims. The expert system provides more stability than the individual method.

Establishing Accurate Claim ReservesNicole Nysse

As a young adult I had one goal in mind after graduating High School, I wanted to own my own collision center. While working in the Auto Body industry I attended classes at Madison College to earn my two year certificate in Collision Repair and become I-car platinum certified. Due to a tough recession I realized I needed more education and wanted to keep my future wide open to more opportunities. So, I enrolled in business classes to understand how a business operates. I am now on course to graduate next fall with an associate’s degree, but with the motivation from an amazing instructor at Madison College I now am face to face with endless opportunities.

My new goal is to graduate with an empha-sis in Insurance. I work in an industry that thrives because of insurance. The insurance industry pro-vides job opportunities that can seem endless. There are many reasons why I would love to work in the claims department for an insurance company. First and foremost I admire how insurance com-panies view their clients. They survive because of the customers and they do everything in their best interest to ensure the customer receives fair and prompt service.

The next best reason, insurance companies have developed great working environments for their employees. We all want to work where we are treated with fairness. The insurance companies we have visited, and the industry professionals we have spoken with, all appear to treat their employ-ees with respect. The opportunity to grow profes-sionally is apparent in every department. Employ-ees in these organizations stay and many of them move into management roles.

I could go on for hours about why I would love to work in the insurance industry, but when it comes down to it....I want to wake up every

morning excited to help people in the commu-nity, build a sense of professionalism, and earn a decent living. Insurance is right up my alley.

Adam completed the two year certificate in Auto Body Colli-sion Repair at Madison Area Technical College. He has been working in a variety of capacities with auto body repair since 2005. He is currently taking Introduction to Loss Investigation and hopes to combine his experience and education to work with auto insurance claims.

Adam Reihl

The Next Best reason

I have learned a great deal in my Introduction to Claims class. From the number of different areas offered within claims, to the connection between court TV. I am lucky to have also obtained an internship opportunity working with claims. I was presented the opportunity by Martha Lester-Mit-tenzwei (Insurance and Risk Management Program Instructor) to explore a new and invigorating career at Neckerman Insurance Services. I couldn’t have asked for a better place to immerse myself.

Neckerman is a wonderful, warm, welcoming, family environment. I like the fact that it is small, but the agency has made a successful name for themselves. My position at Neckerman Insurance Services is fairly simple. I call our current custom-ers to let them know that the policy they have with us is up for renewal and the agent would like to review it with them. I try to make about thirty to thirty five calls every time I work. I don’t want to make too many calls and get too far ahead. The Personal Lines Department is very busy. I also do not want to move too slow. That, I’m afraid, would put me out of a job.

Another task of mine at Neckerman Insurance Services is to make Claim Satisfaction Calls. This ensures that our customer’s needs have been met after their claim has been submitted. I call and ask our client if the adjustor has contacted them and assisted them. If not, I let their personal account

manager know and follow-up is immediately done with the insurance company.

I really enjoy being part of a team. I get to go to meetings and interact in important events. I also like the fact that I am able to see claims hap-pening. This is giving me a wonderful experience. Even though I do not have a license, I feel like I am getting educated with great information. I hear a lot of interesting and different claim situations and see how the insurance company responds. Plus, a majority of the terms I have learned in class, I put to use at work! I feel as though I am putting my education to use every day.

Taking Introduc-tion to Claims has opened my eyes to the many different kinds of opportunities there are in the insurance industry. My interest has grown stronger for a career in this field. I am currently studying communications, but I do intend to further my career in insurance. Martha has been a great resource and an excel-lent instructor. She has an amazing way of mak-ing insurance fun, exciting, and not at all boring. Many people think that it is a boring field. How-ever, I assure you that learning from Martha is much more than learning insurance, it is a builder for your future.

I hope that my career continues to grow with Neckerman Insurance Services. I really enjoy it. I also hope that my knowledge of insurance contin-ues to expand.

An Intern’s ViewClaire Gribble

Claire is currently enrolled in Prelicensing and working towards her Wisconsin Property and Casualty License.

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I want to wake up every morning excited to help

people in the community, build a sense of professionalism,

and make a decent earning. Insurance is right up my alley.

MetLife is hiring in your area! We are looking for talented people to help us meet

our vision: building financial freedom for everyone.

If you are ready to find out just how far a career with MetLife can take you, contact:

Sarah Weseloh, Recruiting Director (414) 615-4880 9000 W. Chester St., Suite 100 Milwaukee, WI 53214 sweseloh@metlife.com Or apply on-line at www.greatlakes.metlife.com MetLife is an Equal Opportunity Employer. Metropolitan Life Insurance Company (MLIC), New York, NY 10166. L0312247870[exp0413][WI]

My interest has grown stronger for a career in this field.

T I P S V O I C E S

Sarah Spahos

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On Tuesday, November 12, 2011, Madison College students in the Introduction to Loss Investiga-tion class took a tour of Service Master Cleaning Restoration at 4410 Duraform Ln, Windsor, WI, under the supervision of instructor Mrs. Martha Lester-Mittenzwei.

The tour started in a conference room where our tour guide, Mr. Dan Tinder, first explained what Service Master does and how it is connected with the insurance industry. Service Master spe-cializes in the restoration of home and business structures, and their contents, after an unfortunate event such as fire, flooding or weather damage. They work closely with insurance companies and the insured to make sure that the insured’s prop-erty is restored back to pre-event conditions in a timely, efficient and cost effective manner.

Next Mr. Tinder showed us some of the tools of their trade. The first tool he showed us was a F.L.I.R. gun or forward looking infrared radar. This device is used to look through walls for water damage and shows the difference in tempera-ture between wet areas and dry areas behind the wall. Before this was available, estimators needed to punch a hole in each wall to check for water damage. This device not only saves time when estimating water damage, but saves needless

Service Master TOUR

damage to structures. Mr. Tinder also showed us a handheld computer programmed with Exacti-mate, a restoration estimating program also used by insurance companies. He explained, this allows an estimator to input a description of the damaged area at the scene and the computer calculates the estimated cost of restoration.

Students were shown pictures of a home that Service Master was currently restoring. The pic-tures were amazing and provided a real look into the damage a fire can cause. In the main storage and work area of Service Master, our guide had set up some displays to show us a few other pieces of equipment they used. We were then provided the opportunity to try them out.

This tour was great because it provided inter-esting information and gave the students a differ-ent perspective of a claim. The information wasn’t to promote Service Master, but to inform us as to the restoration process. It was not only educa-tional, it was “hands-on” learning. Thanks to Mr. Tinder and Service Master Cleaning Restoration for taking the time to provide us with this unique experience.

Greg Dewey is a Business Management student with experience coordinating loss repairs from the business’ side. Greg took the course Introduction to Loss Investigation to gain a better perspective of claims handling from the insurance companies’ standpoint.

It was not only educational, it was “hands-on” learning.

Greg Dewey

American Family hosted students for an informational presentation by claims staff, a

tour of their claims department, and a wonderful lunch.

T I P S V O I C E S It was fabulous to hear from so many different industry professionals. A New View of the

Insurance IndustryI enrolled in the Madison College Introduction to Loss Investigation course to get my feet wet in the insurance world. Sure, I’ve had insurance all my life (and been grateful), but I couldn’t say I truly knew how it all worked. If you get into a car accident, you call your insurance agent, but what determines the outcome of a claim? What if you are injured on the job? What if other parties are involved in your claim? Would you fully understand the terms of coverage if you have a house fire? How will the Insurance Company, that you pay premiums to, handle it?

This course will give the average citizen a deeper understanding of how insurance compa-nies are regulated, how policies are constructed, how to recognize and report fraud, how claims should be handled by the insurance company, the responsibilities of the claims adjuster, negotiat-ing techniques, and how ethics are the foundation for Good Faith Claims Handling. We also learned the wide range of employment opportunities and satisfaction that emanates from the world of insur-ance through class excursions to local insurance-related companies in Madison.

Industry Tours

In our visit to an American Family Insurance Cus-tomer Care Center we spoke to eight employees from Managers to Customer Service Represen-tatives and Branch Representatives whose jobs varied from taking initial claim calls to investi-gating on-site claim damages. Another trip took us to M3 Insurance (f/k/a Mortenson, Matzelle & Meldrum), an Insurance Agency that specializes in finding just the right insurance to meet their cli-ents’ needs in the fields of Property & Casualty, Employee Benefits, Corporate Retirement Plans, Executive Benefits & Disability, Personal Insur-ance, and Risk Management. At M3 we spoke with a Marketing Representative, an Agent, a Service Representative, someone from Human Resources and an owner.

Our final outing was a visit to Service Master Restoration Services. Here, the employees come into the claims picture by working with Insurance Adjusters to coordinate clean up and restora-tion after disasters like fires or floods. They are dedicated to the same cause as the Insurance Adjuster; to get the insured’s life back to normal as quickly as possible. It was fabulous to hear from so many different industry professionals.

The numbers and misunderstandings

There are statistics that show up to 33% of Insureds feel it is okay to inflate a claim to recov-er their deductible, and 22% of Insureds feel it is okay to inflate a claim to recover their premiums. This is mostly a result of a lack of confidence in insurance companies and a sense of entitlement among insureds. I believe that education of the public at the level of this Intro to Loss Investiga-tion course would make huge strides at reversing these startling statistics. The education would lead to an increasing consumer confidence and respect for an industry that provides so many benefits to society: providing payment and covering the social burdens of the losses, providing peace of mind, reducing risks, meeting federal and local statutes for insurance, providing countless employment and tax revenues to their communities. I feel per-sonally enriched by the experience of this class.

Sarah Spahos is a paralegal student who took Introduction to Loss Investigation to broaden her background and learn more about the insurance industry. She took and passed the national Associate in Claims (AIC) 33 exam upon completion of the course.

Use of Analyticsat the Strategic Level

Jeffrey Noble

1514

Friends of Madison College presents

A NEW CENTURY OF PROMISEFRIDAY, OCTOBER 26, 2012

ALLIANT ENERGY EXPO CENTER

How you can become involved: � Contact the Madison College Foundation

and volunteer to join a committee.

� Contribute to the silent auction.

� Spread the word…tell your friends.

� Put the date on your calendar and buy a ticket.

HONOR THE PAST. IMAGINE THE FUTURE.Event proceeds benefit the Madison College Foundation’s Forward Fund and scholarships.

We always do what we say we will.

...And we’re always looking for more people like us.

Preferred Independent Insurance Agency

2008, 2009, 2010 & again for 2011-InBusiness Magazine, Executive Choice Awards.

Apply Online Today!

www.hausmann-johnson.com700 Regent StreetMadison, WI 53715

1-800-729-4287

Real World Smart Bryan WoodhouseINTERIM DEAN,SCHOOL OF BUSINESS & APPLIED ARTS

Iwould like to welcome you and thank you for your readership of our inaugural edition of Tomorrow’s Insurance Professionals! It is our hope and expectation that you fi nd the content in this edition, and in the editions to

come, to be interesting, informative, and applicable to the challenges you face as a current or aspiring industry professional.

With over 30 degree programs, numerous cer-tifi cates, and nearly 4,000 degree and non-degree students there is always something new, and on the cutting edge, happening within the School of Business and Applied Arts (and indeed all around our college). As this initiative in particular has come together over recent months I have many times been asked the question, why a magazine? The answer, at least in my mind, is relatively simple and summarized below: ¾ Our curriculum challenges students to think creatively about solutions to problems. A student driven, industry focused publication is a great way for students to develop critical thinking and creative skills through research, analysis, and publication of industry specifi c topics. In sum, it is a great way to demonstrate what they are learning.¾ At Madison College we are always seeking new avenues for our students to apply their skills to real world projects, and to infuse an element of entre-preneurship into the curriculum. This publication is the product of collaboration between our Insurance and Graphic Design programs to conceptualize, organize, and launch a real world product.¾ Our mission is to provide accessible, high qual-ity learning experiences that serve the community. We view this publication as an excellent learning experience, but moreover it is our hope that this publication will serve the insurance community as a vehicle for delivering valuable information, and as a means to excite young professionals about the opportunities for employment and career develop-ment within the insurance industry.

To say that we are merely proud of this very fi rst edition of TIPS and the opportunity to show-case our student talent would be an understate-ment. So to all who contributed and supported this endeavor, thank you.

Mr. Agarwal emphasizes that busi-nesses must consider adopting multi-channel design principles to stay competitive. Consum-ers not only want the fl exibility to purchase insur-ance policies through numerous avenues but many consumers still prefer the expertise and guidance of an agent. Therefore, the agency system should still be nurtured while blend-ing new-age communication tools, such as the internet and mobile phones. Regardless of the channel, the branding and message must be the same. Customer preferences and satisfac-tion should be regularly monitored and the data used to steer forward.

Analytics Critical to Success

Using analytics to improve the fl ow of infor-mation at the strategic level can only help insur-ance carriers improve their long-term strategic decision-making. By identifying high-value cus-tomers, they can develop new strategies to target them through the appropriate channels, and map new business growth. If the primary goal is to indeed address customers’ ever-changing needs, then the use of analytics is paramount to the long-term success of the insurance organization.

Sources1. Rangaswamy, Arvind; Gerrit H. Van Bruggen (Spring 2005). “Opportunities and Challenges in Multichannel Mar-keting”, Journal of Interactive Marketing.2. Agarwal, Punit; March 2, 2011. “Analytics Critical to the Success of a Multi-Channel Insurance Strategy”, property-casualyt360.com.3. Gordon, Mark B.; January 2009, “Leveraging Business Analytics in Today’s and Tomorrow’s Insurance Sector“.

Jeff Noble teaches Marketing and Entrepreneur courses in the School of Business and Applied Arts at Madison Col-lege. Jeff holds a Masters of Business Administration with a Marketing Emphasis from the University of Wisconsin Madison-School of Business. Prior to teaching, Jeff worked in the insurance industry. Jeff took the course Technology Uses in Insurance this past Fall to meet his continuing education requirements for insurance licensing and also to learn more about the technological advances in the insurance industry. Jeff will be accompanying the Insurance & Risk Management students on their tour to Lloyds in London in May 2012.

Traditional distribution models in the insurance industry have often been product-driven, with less reliance on key servicing components; i.e. – if we build it, they will come. But today’s customer is more informed, and tech savvy than ever, with a multitude of purchasing options available. With products no longer being the key differentiator, dis-tribution and servicing have to evolve to address customers’ ever-changing needs.

In the insurance industry, the proliferation of the Internet, mobile technologies, and social networking sites has substantially altered the purchasing behavior of customers. As a conse-quence, most leading insurance carriers have in recent years adopted multi-channel distribution. Multichannel marketing is simply using many dif-ferent marketing channels to reach a customer1 with the objective being for the consumer to buy from them in whatever way is most appropriate. While the traditional agent channel continues to provide a substantive infl uence on the insurance application and sales process, a growing number of customers are turning to the Web to research and buy insurance products. 2

In his article, Analytics Critical to the Suc-cess of a Multi-Channel Insurance Strategy, prop-ertycasualty360.com, Punit Agarwal states that “multi-channel distribution is a powerful strategy for growth-enabling carriers to target new markets and customer segments, retain customers and increase wallet share. However, a multi-channel approach also brings several challenges.”

One of the fi rst challenges is balancing the need to continue to invest in an existing agent net-work, with the need to invest in promoting online self-service. While the online channel enhances/creates additional reach and certainly conve-nience for the customer, it also has a downside

of lower customer retention. Yet another chal-lenge created by multi-channel distribution is the propensity of customers to switch chan-nels during their insurance purchase cycle.

Today, customers may start their insurance product research online but end up crossing over to a different channel such as the call cen-

ter or agent to fi nally make the purchase.

MADISON COLLEGEINSURANCE AND RISK MANAGEMENTPROGRAM

1716

DINE and DISCOVER

percept ion

We invite you to hostan on-campus lunch presentation to inspire our students with stories about

your company and career.

• Help students discover theopportunities our industry offers.

• Change the perception of careersin insurance and risk management.

• Be part of building Tomorrow’s Insurance Professionals.

Schedule your Dine & Discoverfor Fall Semester 2012 by contactingmlester-mittenz@matcmadison.edu

or 608-243-5417.

real i ty

¾ Advertise in TIPs

All profi ts are returned to the Insurance & Risk Management Students Scholarship & Professional Development Fund. Full Page Advertisers can also author an article highlighting one of their employ-ees, a claim, or a topic related to the current issue.

Our Next Two Issues:October 2012—Business Planning:Creating mission and vision statements, developing a business plan, applying risk management strategies to supply chain man-agement, travel, and other areas. Madison College Insurance & Risk Management Stu-dents tell of their tour of Lloyds in London.

February 2013 —The Ever Changing Insurance Environment: the up and down sides to social media and other current topics facing the industry. Madison College Insurance & Risk Management Students tell of their experience at the 2012 REBEX Conference.

Student content included in each edition:•Profi les•Informational articles•Professional development experiences on and off campus

¾ Advisory Committee

Volunteer your time to help direct our program.

¾ Annual Executive Symposium

Attend or be a panel member. This is our biggest fundraiser each spring. Top Industry Professionals discuss current insurance and risk management topics and all profi ts from the program are returned to the Insurance & Risk Management Student Scholarship & Professional Development Fund.

¾ Employ our Graduates

Contact Martha Lester-Mittenzwei, Program Direc-tor, with the details of your job opening.

¾ Financial Gifts

Provide a tax deductible donation to our Founda-tion specifi cally for Insurance & Risk Management Scholarships & Professional Development.

Madison College derives most of its funding from tax revenues and student fees. There are many needs that cannot be met from these sourc-es, including student scholarships and opportuni-ties to attend industry events. You may give online at www.madisoncollege.org/giving-madison-col-lege or mail your gift to the Madison College Foun-dation, 3550 Anderson St., Madison, WI 53704. Please indicate that you wish your gift to go to the Insurance & Risk Management Program.

¾ Guest Speaking

Visit one of our classes and share your story, knowledge, and experience.

¾ Host a Dine & Discover

Visit our campus, provide a lunch for a limited num-ber of students, and tell them about your company, your career and the Insurance & Risk Management industry.

¾ Internships

Offer our students part-time employment opportu-nities during the school year or full time during the summer to enhance their learning with a real taste of the industry.

¾ Promote the Industry to High School Students in your area.

¾ Tours

Invite our students to your business, or industry event, to learn more about your organization and the industry.

If you are interested in supporting our efforts to attract new talent to our industry, please contact Martha Lester-Mittenzwei, Insurance & Risk Management Program Director. Mlester-mittenz@matcmadison.edu or 608-243-5417.

How Can YouHELP ATTRACT NEW TALENTTO THE INDUSTRY?

14

18

After contacting MATC to assist with developing an Insurance Certificate training, we were amazed at the information they put together for a 2 hour training course. Extremely useful and appropriate information that we were able to put to use right after the class. Can’t wait to have them back again!

Tim Sell , DNR Purchasing Section Chief, Bureau of Finance Wisconsin Department of Natural Resources

2 0 1 2 F A L L S C H E D U L E a n d c o n t i n u i n g e d

COURSE C.E DAY DATESINSURANCE PRE-LICENSING PROPERTY & CASUALTY NONE F/S 10/5–10/13

INSURANCE PRE-LICENSING LIFE & HEALTH NONE F/S 11/2–11/10

INTRO TO LOSS INVESTIGATION (AIC33) YES T/TH 9/4–11/13

TECHNOLOGY USES IN INSURANCE (AIT132) YES W 9/5–10/17

GENERAL INSURANCE INDUSTRY OVERVIEW YES F 10/19–12/7

DETECTING EMPLOYEE FRAUD (ACFE) PENDING T 10/9–12/11

The Insurance & Risk Management Courses are offered in a “hybrid” format which combines face to face classroom with on-line tools to enhance student learning. For more information on dates and times, please visit http://matcmadison.edu/program-info/insurance-certificate or e-mail Martha at mlester-mittenz@matcmadison.edu.

“Martha Lester-Mittenzwei and Madison College do a phenomenal job with their Continuing Education courses. As an insurance professional for over 17 years, I have been through numerous classes with numerous trainers and frankly, they were horrendously boring. That is until we discovered Martha and the group at Madison College. Not only is her class informative and practical, it’s also fun and interactive. Kudos Martha, keep up the great work!”

Paul A. Perkins, Sales Manager, Group Health Cooperative

The instructors at Madison College really want students to be successful. I could not have asked for more supportive and encouraging instructors. I have learned so much from this program.”

Lynn Meier