A.M. Best Gives 'Hide Here Comes the Insurance Guy' A Positive Rating

The key to success for any tool is acceptance by the industry it targets. When I published Hide Here Comes the Insurance Guy, I knew it had to be accepted by the insurance industry if it was going to be taken seriously. The overwhelmingly positive response has both validated the book and humbled me as an author.

Below is a review from David Dankwa, associate editor of BestWeek, which is a publication of AM Best, the financial rating company. The article appears in the November 13, 2006 edition, along with a podcast interview available at bestdayaudio.com.

In New Book, Risk Manager Explains 'Commercial Insurance' in Plain Language

OLDWICK, N.J. November 13 (BestWire) — "If I had grown up in Wisconsin, I would know cheese; Georgia, peaches; Florida, AARP," writes risk manager and author Rick Vassar.

As fate would have it, Vassar was raised in a suburb of Hartford, Conn., the insurance capital of the world, where "folks gather at the local diner in the center of town and discuss such compelling subjects as the necessity of waiver of subrogation and additional insured status or the effects the new insurance commissioner would have on the local economy.

"This is where "the insurance curse began in my family," he writes.In his book, "Hide Here Comes the Insurance Guy," described as a practical guide to understanding business insurance and risk management, Vassar shares the wealth of information he's gathered over several decades in what he calls "plain speaking" insurance language.

There aren't any books available that address the needs of the business insurance consumer, and second, many business professionals refuse to enlighten themselves on the nuances of the insurance trade, he says. As such, "the insurance guy" Vassar describes in his book is a lonely person, something of a corporate outcast. He is the type of co-worker people steer away from in the hallways, afraid that he'd work insurance into a conversation.

Using humor, Vassar, also founder and president of Virginia-based Vassar Group, provides insight into the commercial insurance industry from a risk manager's perspective, offering practical advice on the insurance purchasing process. As he describes how terrorism insurance works, how to value one's property when considering property coverage, and workers' compensation strategies, he also picks on attorneys in a section called "The Skinny on Attorneys" and on adjusters in "Anatomy of an Insurance Adjuster."

Vassar discusses in depth the selection of an insurance broker and argues that bigger isn't always better. The difference between a big, national broker and a local or regional broker is like Advil and Ibuprofen, he writes. "You're only paying extra for the name."Vassar says if a company is in tune with what's going on in the marketplace, it can get the same pricing from a small local broker that would from a midsize, regional broker or Marsh & McLennan.

Also, from a service standpoint, Vassar says he prefers a midsize broker to handle his company's midsize account. "Currently, we have a good bit of premium but it wouldn't be a big number for a national broker, like Marsh. For a midsize broker, it's a significant portion of their overall book of business. So, we're more of a big fish in a small pond, whereas with a bigger national firm, we wouldn't get the same level of service," he says.

He frowns on the practice of corporate insureds assigning brokers to shop specific markets, often at the urging of the incumbent broker who insists that "the underwriter only wants to work with one broker per account." Vassar writes that assigning markets defeats the purpose of a free-market system.

He writes also about the role of lawyers in claims processing. "If you're an organization, especially in a self-insured or self-funding situation and you're going to make a decision that's going to have a financial impact on your company, then it needs to be the company that is making the decision as to the financial viability of either settling the case or taking it to trial. Many companies just hand it off to lawyers as soon as they get a lawsuit."

Vassar cites the McDonald's hot coffee case, "where there was an opportunity to settle the case as a medical claim, and they ignored it. Well, the issues in that case were that there was a legitimate injury, a legitimate burn, and eventually they did work to improve the cups and they lowered the temperature of the coffee that they were serving. They also later settled the claim for a much higher amount."

While the book targets buyers of insurance, Vassar says the insurance community also can learn a lot from it. "I believe the book will give valuable insight to the insurance community as to how risk managers and businesses process their information concerning risk and insurance. If a broker or insurer has a better understanding of the needs and concerns of the insured, they will be better able to market products that will meet these needs."

And what do businesses need? Vassar says it is: "The best price and the comfort of knowing that what they are buying will cover an event that creates a financial uncertainty which could prevent them from opening their doors tomorrow, or could close their doors forever."

(Listen to an audio conversation with author Rick Vassar at bestdayaudio.com)(By David Dankwa, associate editor, BestWeek: David.Dankwa@ambest.com) BN-NJ-11-13-2006 1032