'Tale of Two Counties' Shows Value of Preparation

It's been an eventful past 12 months in Brooklyn. We've been hit by a tornado, several intense snowstorms, and an earthquake since about this time last year. So, with Irene rolling in, and recalling the headaches that followed other weather events (snowstorm response was famously criticized just a few short months ago), I decided to retreat to my aunt's house in White Plains, Westchester County, to the north and west (and on a hill) to ride out the storm.

And, it worked out. We're dry, had power the whole time, an extra pair of hands to help with my three-month-old, and avoided property damage. However, it's a good thing we're where we were in Westchester — because almost immediately, I found out that north and west wasn't necessarily the best place to be. Some people I follow on Twitter, who live in some of the low-lying, water-adjacent communities in the county, reported flooded basements and power outages. That made me feel a little bad for posting this. Then I felt worse when I saw people in Elmsford, who had already raised their house following Hurricane Floyd, being rescued by boat barely 4 miles from my position. And by the time I saw this morning the catastrophic flooding farther upstate and in Vermont, I regretting seemingly joining what had become a chorus of people saying that the storm wasn't so bad (though I was just trying to convey that we were OK with a little snark.) In this way, it was a tale of two counties: the high ground, where we were, largely spared the worst destruction while some other areas were hit harder than expected.

I learned, however, to follow my own advice. I wrote last week that despite how much we try to prepare for hurricanes, the best we can hope for is that nothing wildly unexpected happens, and that no preparation is too cautious with the unpredictable nature of the weather — especially as major storms approach developed areas. For P&C insurance companies, projecting an aura of preparation is especially important. Customers expect to have to file claims, and in many cases this is the only time when they interact with their insurers. In a soft domestic market where the easiest way to grow is by poaching customers from competitors, a positive claims experience that builds confidence in your company can help ensure that when it comes time to renew, policyholders' eyes don't wander. That may be why claims system upgrades have increasingly focused on the customer experience, as Conning Research asserts. (I moderated a webcast on a similar topic, ironically enough, the day of the earthquake.)

People may gripe about being asked to evacuate, or the subways being shut down for a day, or accuse the media of sensationalizing a "minor" storm. But they'll never complain about their insurance company being available quickly if they unexpectedly are nailed by a CAT event.

Nathan Golia is senior editor of Insurance & Technology. He joined the publication in 2010 as associate editor and covers all aspects of the nexus between insurance and information technology, including mobility, distribution, core systems, customer interaction, and risk ... View Full Bio