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Farmers Insurance Laying Off 11% of Workforce, Citing Industry Challenges

insurancejournal.com

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Re: Farmers Insurance Laying Off 11% of Workforce, Citing Industry Challenges

#11

Post by sydbarrett74 »

whynotmaybe wrote: post #4
JKCalhoun wrote: post #2

All I see in the article is the discussion of "profits". I would think the PR department could come up with something about "trying to keep costs competitive for our customers" or something like that. Instead they're telling California and Florida customers to take a hike ... along with 11% of their employees. When is the last time we heard a company enact a company-wide, 50% cut in officer's salaries and a freeze on…

2014 https://www.ibtimes.co.uk/nintendo-boss-cuts-salary-save-job... 2019 https://www.hcamag.com/us/news/general/ceo-sets-70k-minimum-...

Those are 'rarer than hen's teeth' exceptions that prove the rule.

Re: Farmers Insurance Laying Off 11% of Workforce, Citing Industry Challenges

#12

Post by foooorsyth »

JKCalhoun wrote: post #2

All I see in the article is the discussion of "profits". I would think the PR department could come up with something about "trying to keep costs competitive for our customers" or something like that. Instead they're telling California and Florida customers to take a hike ... along with 11% of their employees. When is the last time we heard a company enact a company-wide, 50% cut in officer's salaries and a freeze on…

I appreciate the direct language. It’s refreshing to not have to read through the lines of PR-speak.

Re: Farmers Insurance Laying Off 11% of Workforce, Citing Industry Challenges

#13

Post by nvahalik »

I wonder which part of the business they laid off those folks from. The article doesn't say.

In general, there are 3 main parts of an insurance company that are "in house": underwriting, claims, and accounting.

Accounting isn't really something that can be automated or outsourced.

You can't automate claims, but you can outsource.

You can automate/outsource _some_ underwriting and/or parts of the underwriting process.

Increasingly, I've seen independents adjusters (IAs, not to be confused with Public Adjusters [PAs]) doing underwriting inspections. Basically, when your adjusters aren't adjusting, they are inspecting new policies to ensure that they meet guidelines.

So I am guessing these layoffs are probably from one or both of those areas.

Re: Farmers Insurance Laying Off 11% of Workforce, Citing Industry Challenges

#14

Post by lotsofpulp »

londons_explore wrote: post #7

I really don't think an insurance company should have 24,000 employees. Even 240 employees sounds like too many to me. They serve 10 million customers. Nearly every customer should be able to use an entirely automated online form for signing up and for making insurance claims. Claims should be settled entirely with the customer uploading a 1 minute video showing what damage occurred, plus the bill to fix it. Assume 1…

You seem to have found an edge in the insurance business, which will enable you to offer more competitive premiums and win business from existing insurers. Best of luck!

Re: Farmers Insurance Laying Off 11% of Workforce, Citing Industry Challenges

#15

Post by pwarner »

criley2 wrote: post #8
JKCalhoun wrote: post #2

All I see in the article is the discussion of "profits". I would think the PR department could come up with something about "trying to keep costs competitive for our customers" or something like that. Instead they're telling California and Florida customers to take a hike ... along with 11% of their employees. When is the last time we heard a company enact a company-wide, 50% cut in officer's salaries and a freeze on…

I hate to be that person, but this is the future. Because of climate change, more of our country is barreling towards "uninhabitable". It's not Farmers fault that we released too much CO2 and now wildfires and hurricanes are way worse and getting even more worse. If the people of California and Florida want insurance so they can build matchbox houses in high risk disaster zones, then they can start a public insurance…

For sure insurance companies have a chance to act as a forcing function to drive better building codes, fuel management, etc. Those are hard things, especially for existing homes, but it's a simpler calculation for a homeowner to put $100k into a retrofit of it will save them $10k a year in insurance...

Re: Farmers Insurance Laying Off 11% of Workforce, Citing Industry Challenges

#16

Post by [deleted] »

whynotmaybe wrote: post #4
JKCalhoun wrote: post #2

All I see in the article is the discussion of "profits". I would think the PR department could come up with something about "trying to keep costs competitive for our customers" or something like that. Instead they're telling California and Florida customers to take a hike ... along with 11% of their employees. When is the last time we heard a company enact a company-wide, 50% cut in officer's salaries and a freeze on…

2014 https://www.ibtimes.co.uk/nintendo-boss-cuts-salary-save-job... 2019 https://www.hcamag.com/us/news/general/ceo-sets-70k-minimum-...

[deleted]

Re: Farmers Insurance Laying Off 11% of Workforce, Citing Industry Challenges

#17

Post by justin66 »

londons_explore wrote: post #7

I really don't think an insurance company should have 24,000 employees. Even 240 employees sounds like too many to me. They serve 10 million customers. Nearly every customer should be able to use an entirely automated online form for signing up and for making insurance claims. Claims should be settled entirely with the customer uploading a 1 minute video showing what damage occurred, plus the bill to fix it. Assume 1…

> Claims should be settled entirely with the customer uploading a 1 minute video showing what damage occurred, plus the bill to fix it.

And your plan for when clients are unwilling or unable to conform to your idealized filing process would be what? Simply don’t reimburse them? Or when they’re unsure what’s covered ? Or have some other question that’s urgent and not covered by an online FAQ? It’s a highly regulated industry, so that’s all going to go great.

Have people been so beaten down by shitty non-service from tech companies that they think this approach is normal?

Re: Farmers Insurance Laying Off 11% of Workforce, Citing Industry Challenges

#18

Post by hutzlibu »

londons_explore wrote: post #7

I really don't think an insurance company should have 24,000 employees. Even 240 employees sounds like too many to me. They serve 10 million customers. Nearly every customer should be able to use an entirely automated online form for signing up and for making insurance claims. Claims should be settled entirely with the customer uploading a 1 minute video showing what damage occurred, plus the bill to fix it. Assume 1…

Well, when you have claims involving million, you probably want to spend more then 10 minutes investigating a claim. Insurance fraud is a real thing.

Otherwise I agree, there is likely a lot that can be done to make the processes more efficient.

Re: Farmers Insurance Laying Off 11% of Workforce, Citing Industry Challenges

#19

Post by nvahalik »

londons_explore wrote: post #7

I really don't think an insurance company should have 24,000 employees. Even 240 employees sounds like too many to me. They serve 10 million customers. Nearly every customer should be able to use an entirely automated online form for signing up and for making insurance claims. Claims should be settled entirely with the customer uploading a 1 minute video showing what damage occurred, plus the bill to fix it. Assume 1…

> Nearly every customer should be able to use an entirely automated online form for signing up and for making insurance claims. Claims should be settled entirely with the customer uploading a 1 minute video showing what damage occurred, plus the bill to fix it.

Ah yes, the perfect recipe for fraud!

> Assume 1 claim per customer per decade

Herein lies the problem in some parts of Florida/California. If Florida gets hurricanes every year, then you're talking about a lot of payouts. This is a big part of the reason they are pulling out.

> and each claim takes an average of 10 minutes to handle

Normal claims take several hours apiece, depending on the type of claim and loss. Claims are documented. That way people can't get a new roof every 3 years and never replace it. Also, people don't actually know what their policies cover. Adjusters have to know the policies they adjust so that they can approve/deny coverage based on what the policies actually state.

> check video, spot check bills, make payment

They'd go out of business pretty quickly. People like to crap on insurance companies but there are a lot of people out there who are grade-A A-holes who feel like they should be compensated. It's amazing what some companies will pay for but it's also amazing how entitled people feel like they are.

Re: Farmers Insurance Laying Off 11% of Workforce, Citing Industry Challenges

#20

Post by mooreds »

londons_explore wrote: post #7

I really don't think an insurance company should have 24,000 employees. Even 240 employees sounds like too many to me. They serve 10 million customers. Nearly every customer should be able to use an entirely automated online form for signing up and for making insurance claims. Claims should be settled entirely with the customer uploading a 1 minute video showing what damage occurred, plus the bill to fix it. Assume 1…

There's your $1B business idea. /s

No, seriously, I know some folks are trying to reinvent insurance. I worked for an insurance brokerage in my youth. There are a few hard parts:

* sales. It's a confusing, uninteresting product, so you have to sell it. Ever wonder why you see so many commercials for State Farm, Allstate, etc? You can work around this some with independent agents, but then you have to recruit and retain them.

* risk management. You have to know how to price the risk (or find someone who can). I'm sure this can be automated to a great extent, but then you have to write or buy this software. I worked for company that built a business on finding weird risks (outfitter and guides, special events, inland boat coverage) and connecting them to people who could price the risk.

* legal understanding. Have you ever fully read a homeowners policy? There's tons and tons of legalese defining exactly what is covered and what is not. ACORD[0] does a lot of this, but you still need to know what you are doing.

0: https://www.acord.org/ACORD-about/ACORD-About

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