Volume 37, Issue 1, January 2002
You May Be Surprised to Learn Who’s in Your Bed at Night
by Lyle R. Hill
I’m a little slow. I’m not proud of this, and I actually think that at one time I wasn’t. It sometimes takes me a little longer to catch on to things than it does for other people. This pains me to no end, but there is little I can do about it ... especially at this point in my life. A few years ago, after being taken advantage of by any number of con artists, charlatans and architectural aluminum salespeople, I wised up. No, I didn’t get any quicker. I just accepted what apparently everyone else knew all along ... that I’m kinda slow ... once in awhile even a bit dense. However, I also discovered something else while in the process of coming to terms with this weakness. For you see, once we identify and acknowledge our shortcomings, we are well down the road to dealing with them and even conquering them.
Although I will admit that if I would have been quicker to discover my slowness, I would have solved this problem much faster. On the other hand, if I would have been that much quicker then perhaps I wouldn’t have been slow in the first place and the quickness herein referred to would have had no slowness to overcome. Or perhaps the more perplexing question is whether or not a person can be both quick and yet slow at the same time? WAIT ... I’m getting a headache ... what was my point? Oh, yeah. OK ... I’m back.
The point I’m trying to make ... and yes, I realize that the points are few and far between ... is that I have come to grips with this slowness dilemma of mine and in some ways, I am a better person for it. For you see, I now do these rare things that if I had been a quick person, I would never have even thought about doing. For instance, I almost always read the instructions ... carefully and completely. I often take advice from people who know things about the things I don’t know much about. And perhaps most important of all, I have learned to ask a lot of questions.
The Check is in the Mail
I received my homeowner’s insurance policy renewal statement in the mail a few days ago and I did with it what I do with all bills when I first receive them. I threw it in the bill drawer, which is located in the kitchen. It’s the first drawer I pass when I come through the back door. The bill came on a Tuesday and I have a general rule that I never look at a bill during the week ... unless I’m on vacation. My weeks are hard enough to get through without dealing with bills, so I usually save them for the weekend which means that they often don’t get reviewed until Sunday night ... after the grandkids have gone home and the house has been more or less restored to working order.
Now, if I was a daring person (and for the most part I am not) I would tell you right here and now exactly who the bill was from because at this point, you—being the super quick reader and thinker that you are—and yes, I’m jealous of you ... have already figured out that I wouldn’t even have brought this insurance bill thing up unless I was going to rip them a bit. But alas, I am not that daring. Slow, yes ... daring, no. So that part of the story you will have to figure out on your own. And don’t call me because I still won’t tell you to which insurance company I’m referring here!
Anyhow, I received this bill, put it in the drawer and pulled it out to look at on Sunday night. Then it got interesting. Upon close examination of the bill, I noted that it is dated December 19, but has a due date of February 15 ... the invoice arrived two months before its actual due date. Now, I’m one of those guys who likes to get his bills paid and out of the way, and had I not noticed the difference between the processing date and the due date, I would have mailed in my check and never been the wiser. And my extremely quick and clever insurance company would have gotten paid close to two months in advance. The irony here, of course, is that I do a lot of work for this particular company and as long as they are paying me two months after the work is done and billed, I’m usually pretty content with the whole process.
Now we’ve already established that I’m slow, but there is something else that I am, too. I’m very thorough when it comes to keeping records. So, I pulled my last year’s invoice and discovered that the new policy was going to cost me 8.43 percent more than it cost me last year. Additional investigation indicated that my policy had gone up by a similar percentage the year before that as well. So over this two-year period, my insurance has gone up by approximately 15 percent.
I called my agent ... not to complain ... just to ask some questions. When the very pleasant receptionist answered, I asked for the agent by name. He was not in. And while I’m on this, I have now been with this agency for more than 18 years and have never spoken personally to the agent. He sends me a birthday card and a Christmas card every year, and I get lots of mailers offering to provide me with life insurance quotations, but I have never talked with him or met him in person. Maybe he’s a little slow, too. I mean after all, it’s only been 18 years.
I asked the pleasant-voiced woman who answered the phone if someone could help me understand my renewal bill. She took my name and policy number and apparently pulled it up on her computer screen and informed me that she could answer my questions.
“Why did my bill go up by more than 8 percent?” I asked.
She quickly and politely told me that costs are always going up and that if my home needed a repair it would (by their estimate) cost approximately 8.5 percent more to perform that repair in the next 12 months than it would have cost in the last 12 months. I then told her that I had some ties to the construction industry and that it was my understanding that material costs had gone down and that labor costs were predicted to hold steady. She then informed me that they are very scientific in their analysis of these things and never make mistakes in this area. I also pointed out to her that I had been with them for 18 years and never had a claim. She then congratulated me on my good fortune but further informed me that I could sleep well at night knowing that my home was insured by one of the country’s largest and most recognized insurance companies ... probably one of the most profitable too. And she further said that in some ‘hard-to-describe yet very real way,’ it was as though my insurance company was there sleeping right beside me.
This actually made me feel a little uneasy. In fact, the whole thing was kinda bothering me and while I know I shouldn’t have gone too much further with the conversation, I couldn’t resist.
So I pressed her on what process they used to come up with this inflationary cost projection. She then directed me to look at the front page of the renewal notice form and to pay particular attention to the last item mentioned in the coverage rate section. And there I found it ... the “inflation coverage index.” And on my particular renewal, I had a 190.7 inflation coverage index amount. Although my friendly insurance representative couldn’t explain exactly how, she assured me that this rate of 190.7 explained and therefore justified my 8.5-percent renewal rate increase. Something about how the people who do home repair work had to raise their prices to cover the inflationary impact of higher material and labor costs and naturally, these price increases had to be absorbed at least partially by the insured parties. After all, she explained, this is the way the real world works. I reminded her that I’m in the glass business and I’ve been convinced for years that it’s a business that doesn’t even come close to representing the real world as others may know it.
Who’s at Fault?
Ultimately, the conversation took a bit of a turn and I pointed out to her that the company she represented had not allowed us to increase our prices for either residential or auto glass losses during the past two years. And in fact, our prices for auto glass work had actually been forced to go down over this period of time.
“Well, who’s to blame for that?’ she asked.
“I’m not sure I know. Maybe we need an inflationary coverage index of our own. Do you think that would help?”
“It might not hurt,” she replied. “Have you had cost increases during the past couple of years?”
“Dozens of them,” I answered. “Material costs, equipment, labor and insurance costs, of course, have all gone up.”
“Well then, maybe it’s your own fault,” she stated with a slight undertone of arrogance in her voice. “You shouldn’t be blaming us. You’re to blame. In fact, you need to ask yourself ... what’s wrong with me?”
“I already know ... I’m slow ... very, very slow.”
“And the rest of your industry?” she snapped.
“Apparently,” I replied, “I’m not alone.”
I hung up, made out my check and mailed it the very next day ... a full six weeks before it was due. And I slept well that night in the knowledge that I was insured by someone much quicker and much more clever than I could ever hope to be. And I tried hard not to toss too much or snore too loudly so I wouldn’t awake the insurance company sleeping there beside me ... and dreamed peacefully of one day being an agent myself ... wow, am I slow or what?
Lyle R. Hill is president of MTH Industries of Chicago. firstname.lastname@example.org
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