Insurance Smart – Laying the Foundation

Michael Binns, CPCU, AIM

Insurance Smart

Welcome to your Insurance Smart blog! The plan is simple –  help the everyday consumer get a little “smarter” about insurance.  Each week we will explore a different topic, ranging from the basic, to the complex – and everything in between. In this inaugural edition, however, we are going to lay some ground work.

Experience Counts

Perhaps you are thinking – why this blog? Does this guy really know anything that’s actually going to help me, my family, and/or my business navigate the ever rough waters of insurance?

For starters, I am a 3rd generation insurance guy.  I acquired my 1st insurance license when I was 19 while still in college.

My professional career began as an underwriter when I was 23.  I will not bore you with everything in between then and now – you can review this on your own by accessing my LinkedIn profile.  My point is this – you can trust me.

Oh yeah, and you are now likely asking yourself – so what? Why should I care? Insurers are all the same – looking to line their pockets with my hard-earned money – right?

Wrong! (for the most part anyway) – insurers play a vital role in the US economy and work hard to set reasonable rates based on risk.  Not only are the good ones there when you really need them, they also contribute in a big way to local economies.

Economic Impact
Insurance works. It works for individuals, for families, and for the economy as a whole. Some people know from personal experience how important it can be.
Most people do not have a very clear idea of how and why insurance works. Most people are unaware of the insurance products available or how they can be employed in individual cases.
In addition, many people are unaware that the insurance industry plays an important role in the economic security of the country.
Consider the graphic on the right.  Take just a minute to review it and then think about the opposite – a negative $6K per capita (or more) impact.  How long do you think our great nation could sustain this type of economic impact?  Answer – not long.
Below you will find a link to the complete Lloyds study and website.  It’s interesting stuff, much of which you probably have never been exposed to.

Lloyds Study – Non-Life Insurance Contributions

Local Contributions

Every dollar collected by admitted insurers is taxed.  These taxes are frequently used to fund critical projects like roads, schools, and other essential services.

Depending on the state and the amount of premiums collected, these revenues can easily be in the tens, and even the hundreds of millions. If you are interested in seeing how these numbers add up in your state, go to your state’s department of insurance website and search under “premium tax revenues”.

That’s it for this edition.  I plan to keep these posts crisp and concise, allowing readers to gain additional insights, facts and information.  We will focus future posts on more specific things that more directly impact you and your family.

Until then, be happy, be safe and stay connected!

Value, Trust and Service