Industry Insights

Few events will have a profound impact on both your business and personal lives, and that statement could not be truer than in reflection of what we experienced 20 years ago. On the morning of September 11, 2001, I was in a meeting with a number of reinsurers and our attorneys in a New York City skyscraper on the corner of Park Avenue and 50th Street. There were about 20 of us in a boardroom discussing a legal matter in which we had a common interest. There was an arbitration coming, and we were discussing strategy and timing.

The NCAA Women’s College World Series is one of my favorite sporting events of the year. While I lived in New Jersey, I was lucky enough to be the volunteer assistant coach for the Rutgers University women’s softball team for 10 years. During that time, we were never a great team, but I enjoyed being around the players because of their enthusiasm for the game and the joy they brought with them – to the games, to the practice field and even to lifting, study hall and team meetings. (Okay, that last one was a stretch…)

I went home from my office at 501 Penn Avenue in Pittsburgh, PA, around noon on March 18, 2020, after making sure one of our new employees had the computer equipment she needed to work from home. During my commute, I listened to a President Trump news conference on CNBC radio discussing the Coronavirus. At the time, I thought we would be home for six to eight weeks, and then we would be back in the office and things would return to normal. Well, a lot has happened since then.

I have a confession to make. As I watched the Coronavirus pandemic spread throughout the world and into the United States in late January and February, I was openly derisive about the potential impacts. I was convinced this would just be another flu (don’t we have one of those already), and this would not likely be a significant concern, both from a risk/loss perspective and from a societal impact standpoint. It’s a good thing I learned an important lesson a long time ago: be humble in defeat. 

At HM Insurance Group (HM), we’re very proud of our financial strength. Our Stop Loss paper is rated “A” by A.M. Best, and we have a combined surplus of more than $1,000,000,000. That’s a lot of zeroes. This capital is the financial bedrock of the promise we make to employer groups – we will pay their claims. The Stop Loss market has changed a lot in the past ten years. Prior to the passage of the Affordable Care Act (ACA) in 2010, we issued limited policies, meaning they had annual or lifetime policy maximums of $1,000,000 or $2,000,000. As an underwriter at that time, it was hard to envision claims reaching those policy limits. But now it’s something that happens with frequency.