The Volcano and Your RIMS

Will RIMS attendance be down because of the lingering effects of the Icelandic volcano? Is insurance's face-to-face business model a thing of the past?

By MATTHEW BRODSKY, senior editor/Web editor of Risk & Insurance®

BOSTON---It is often easier to get risk managers to open up, one, when they are dressed in casual clothes and, two, before they realize you are a member of the media. On the morning of April 25, at the Boston convention center for the annual RIMS Volunteer Day event, one such risk manager, dressed in clothes appropriate for building bookshelves, talked about how about 25 of her London underwriters might not be making it to RIMS because of Iceland's Eyjafjallajokull volcano, which blew its top April 14 and threw international air travel a smoky loop.

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The disruptions in air travel raise the question as to whether flying halfway, or all the way, around the world for business is a smart idea, or at least necessary all the time. With sustainability and saving money in mind, wouldn't it be more appropriate for companies to use videoconferencing technology, say, or even just old-fashioned phone calls to do more business?

Would that fly in an industry like insurance, which prides itself on being a "personal" business?

Just from anecdotal observations at the annual conference of the Risk and Insurance Management Society Inc., one would have to say that a lot of people have managed to fly in for the meeting in Boston, and many of them are speaking foreign languages, or English with a funny dialect.

Elizabeth Demaret, who is managing director of international services at Arthur J. Gallagher, said that her work is "first and foremost" a personal business, perhaps even more so than with U.S. insurance.

"I couldn't run my business without personal contact," she told Risk & Insurance®.

Imagine, she explained, a client with a $50 million claim in China. Would you be able to handle that over the phone?

Even for everyday sorts of tasks and favors, it is only natural to do more for someone you know, whom you've met.

It is easier to put somebody on the bottom of a to-do list, she said, if you've never met them.

Then again, business has still gotten done in the insurance world the last couple weeks, despite ash clouds hovering over Europe.

"I've never had a canceled trip because of a volcano before," said John Murphy, executive vice president of Ironshore, adding that one of his international meetings had instead been done by videoconference ... which he observed with a smile on his face was far cheaper than flying.

Murphy then went on to describe to Risk & Insurance® his impressions of the property insurance market, and when, if ever, he foresees an end to softening. More on that later ...

Getting back to business travel, take the example of the Chubb WORLDcert system, unveiled and demonstrated at a press conference on April 26 at RIMS. It allows drug and medial device developers to secure insurance documentation for clinical trials online. The functionality, with drop-downs and pop-up calendars, is similar to buying an airplane ticket. No need here to really even pick up a phone, let alone fly somewhere to deal with a local agent or underwriter.

April 27, 2010

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