A View From The Press Box

Consumers always receive a shock when prices soar.

How about fuel costs earlier this year? Consumer perception was that Big Oil was flush with cash, and weren't they?

In the aftermath of hurricanes and soaring prices, exactly how full are the tanks of coastal insurers?

I see a parallel between our industry and the industry of politics. Congress is loathed, but incumbents almost always win reelection. Why? Because they have convinced their constituents that they are honest, have the constituents' best interests at heart, and that they are outsiders to the loathsome business of Congress.

As a small, independent agency, I don't think we have a single client who likes the insurance industry. But as their agents, they have confidence in our integrity, professionalism and believe we are looking out for their best interests.

Changing the perception of the public toward our industry is a battle we cannot win because:

1. There is enough greed in our industry to make the perception partially true.

2. People will always complain.

But we can--by integrity, service, and professionalism--help our own clients understand that we are the "good guys."

When the consumer has to dig deep to pay for a necessity, and forego other needs, it's pretty evident they will complain, whether fuel, insurance, the cost of lettuce or whatever.

The main difference is the return on that cost. If the lettuce wilted on the way home or the gallon of gas ended up getting them only half the milage they expected, the hue and cry would be huge. So, is it any wonder they complain so loudly when their perception is that the product we offer is paid for with those same hard-earned dollars and returns so little in time of need?

Notice I said "perception," since it's not so in all cases. But as I have preached to the choir in so many previous posts, unless we change the public's overall perception of who we are and how we do business, we'll always be seen as the ones who gouge and rip-off the consumer, and never pay our fair share when the loss occurs.

Can we change that to our benefit in the future? And before the next disaster to avoid another drawn out Katrina legal and legislative debacle?

Unfortunately, I'm inclined to believe it's not all that likely to happen in the foreseeable future.

The public perception is so awful, that I try to avoid telling people what I do for a living when in a social situation.

We have an uphill battle to change perceptions, but it can be done, as Paul Fudge mentions, "by integrity, service, and professionalism."

I also think we need to do more in the public eye. It’s great to hear through industry news that crooked agents are being arrested, and those defrauding insurance carriers are being arrested. But the public at large should hear this, too.

The public needs to know that fraud in our industry is not acceptable and is being prosecuted. The public also needs to know that defrauding an insurance carrier raises rates for everyone.

One day we will be less of an enemy. We all just need to work at it.

WE are the industry they love to hate. How do you change their minds when so many think:

1. They shouldn't insure to value, even when you explain coinsurance.

2. The insurer should still pay them whatever they claim--it's their right to make a profit after all those years of paying premiums and never making a claim.

3. It's okay for them or their neighbor, who lost a few shingles in Wilma, to go up on the roof and tear off enough more to equal over 25 percent so they can collect for a brand new roof (Fl building code), THEN just replace the shingles that blew off or they took off, and pocket the money; and no one turned the perpetrator in for fraud.

4. They shouldn't put up shutters. Why? We're never going to get hit. It's just an insurance industry scam to raise rates. (The number of coastal houses without protection is mind-boggling, and businesses are even worse.)

5. The folks in Idaho or Montana should be required to subsidize our windstorm insurance, even if we want to put our unprotected houses and businesses on barrier islands, because if they don't, we can't afford to build on those islands.

6. The U. S. went all of 2006 without one hurricane, so they should cut the rates in half, NOW!

7. It's okay to mortgage the state's future for years to come just to get politically expedient, minor rate reductions NOW!

8. It's okay for the governer to predict his reforms will produce 25 percent reductions in homeowners rates, but blame the insurers for reneging when it turns out his math is faulty--and no one notices his sleight of hand.

etc., etc.

I agree with all of the points made by the previous posters. Nobody likes paying any premium for insurance. However, the industry is not blamless.

The lack of concern by State Farm demonstarted by the way they declined the Katrina storm surge claims...no coverage at all. That was a "sue me if you want to--we don't care" attitude. Now they are paying, not 100 percent but something, which is what they should have done from the beginning.

After 2004 and 2005, the premiums were at least double the pre-2004 levels.

The industry said we need these higher premiums and it was hard to argue against it. So from the public's perception, the rates are now "adequate"?

Then comes 2006...no hurricanes. Does the industry say, now we're caught up, and let's just see how it goes? No. Instead, it's more rate increases, more whining about Florida getting into the insurance business, etc.

I was in the business, and I think the industry is gouging and getting all they can get.

There is no easy solution, but I don't see the industry trying to work with the goverment to come up with something that makes sense. All you hear is how whatever Florida proposes won't work.