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The Regulators: Season 2 Episode 6

Transitioning to the New Normal with Insurance Experts

The Regulators S2 E6 Insurance Experts

All 50 states have partially or fully opened after shutting down due to the COVID-19 pandemic. For many, returning to work can be scary, awkward and confusing. Karen Stakem Hornig⁠ — National Insurance Producer Registry's CEO, Tennessee Insurance Commissioner Hodgen Mainda, and Susan Neely⁠ — President and CEO of the American Council of Life Insurers discuss how the virus has changed their thoughts about professional life and influenced their workplace transition plans.


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EPISODE TRANSCRIPT

Karen Stakem Hornig [00:00:01] For me, productivity equaled office hours. And the last 15 weeks have shown me that I've been completely wrong about remote working.

Commissioner Hodgen Mainda [00:00:12] We transition to a full five-day remote working schedule doing that. We've been able to trim our budget, which has been really, really beneficial to taxpayers.

Susan Neely [00:00:22] We've made a seamless transition and possibly are even more productive than ever.

Mike Consedine [00:00:27] Welcome to the regulator's podcast, where we look at the important issues facing consumers, state insurance regulators and the industry. I'm your host, Mike Considine, CEO of the NAIC. All 50 states have partially or fully opened at this point after shutting down to the COVID-19 pandemic. For many, myself included, the reopening means transitioning back into a workplace. Returning to whatever is the new normal can be scary, awkward and confusing for some. Organizations will have to make changes to the workplace, to their policies, to their approach to employee relations, and to discuss how different organizations are handling this transition to the new normal we have a first for the regulators podcast in that we have more than one guest. So, joining me today are Tennessee Insurance Commissioner Hodgen Mainda, National Insurance Producer Registry CEO Karen Hornig, and Susan Neely, who serves as president and CEO of the American Council of Life Insurers. All of you have abbreviations for your various organizations, so we'll get into those. But thank you for your participation in this special podcast. Virtually, of course. So thankfully, no masks are required. But welcome, everybody.

Commissioner Hodgen Mainda [00:01:50] Thank you.

Karen Stakem Hornig [00:01:51] Thank you, Mike.

Susan Neely [00:01:52] Thank you.

Mike Consedine [00:01:52] So we'll get right into it, because I know this is an exciting topic that has consumed all of our collective attention over these past few months. And I'm going to ask maybe a few questions for each of you, and we'd like you all to weigh in and if you feel like expanding on a comment from one of the other guests, feel free to do so. We want to make this as interactive as possible.

But Karen, CEO of the NIPR. I'll start off with you because I know we've been working closely on some of our collective and mutual challenges, but I'd be really interested in hearing about how working remotely has challenged your thoughts and ideas about your workplace functions and how those thoughts and insights are going to impact the reopening of NIPR?

Karen Stakem Hornig [00:02:45] Thanks, Mike. You know, when I entered the workplace a long time ago, almost 40 years ago as a young lawyer, one benchmark in exceptional performance was the number of hours you logged in your office or in the law library. So as a result, I had a long-ingrained bias against remote working. For me productivity equaled office hours. And the last 15 weeks have shown me that I've been completely wrong about remote working. NIPR is a technology company, so we have somewhat of an advantage in shifting to remote working. But we were able to pivot one hundred percent to remote working very quickly and our team members are reporting higher rates and productivity and that's been borne out in verifiable outcome measures. So, people are adjusting to electronic tools. There's always a struggle there. And we've had to adjust to some issues around scheduling. But the outcomes have been so positive that NIPR has made the decision to continue remote working until we see a consistent decline in COVID cases in our area. We're based in Kansas City, where right now we're seeing a troubling trend of upward cases like several areas are. So, we're doing slow and steady, putting the health of our employees first. And I think when we reopen and however it looks, then we will have far more employees who are either completely remote workers are or partially remote workers.

Mike Consedine [00:04:36] Yeah. Karen, thanks. Absolutely fascinating. And I know, you know, we increasingly are reading about any number of organizations that, as they look ahead, are making that decision to continue remote operations. So certainly, that's a trend we'll need to keep our eye out, because it certainly has implications also for companies that we regulate. But, you made another comment which I can also, having been a recovering lawyer myself, and certainly understand the bias towards remote working and the need have time in the seat, as it were.

And Commissioner Mainda, going to you, because we also share an experience of working for state government, which has also, I think, fairly struggled with how you do remote work, because so much of the work you all do involves interaction with each other or with the consumers that you're protecting or the entities you're regulating. I'd be interested in your views on this issue. Again, particularly coming from a large state agency that has a fair amount of interaction with consumers.

Commissioner Hodgen Mainda [00:05:47] Thank you, Mike, and thank you for having me on. I'd first like to applaud the proactive approach that Governor Lee, my boss and the administration has taken to support Tennesseean after a series. As you know, Mike, we have had two tornadoes, a derecho and a global pandemic all happening in the last three to four months. While following the safer orders, we've been able to maintain close to 100 percent of business processes while prioritizing safety of the employees and, of course, the general public. And we transition to a full five-day remote working schedule while ensuring that our customers are supported. And doing that, we've been able to trim our budget, which has been really, really beneficial to taxpayers and utilize technology, as we are doing today, and using platforms like Zoom and WebEx to stay in touch internally, but also with our external stakeholders to continue business for 6.8 million Tennesseans. Mike, I say all of that to say that we are now in the process of reimagining what reopening of our workspace looks like. I'm glad that 60 percent of Tennessee Commerce and Insurance Department employees were working from home before COVID-19. And so transitioning to whole five day works schedule was a little easy for us, but the reimagining has forced us to rethink, do we really need everybody who was in the office before back in the office and what does that look like? I say that to say it's never probably going to be the same as it was prior to March of 2020.

Mike Consedine [00:07:42] Yeah. Commissioner, you've had, I know, quite the year already. I mean, as you were listing all of the events you've had to deal with, it feels like something right out of the Old Testament or a scene from Ghostbusters. And now I'm reading you've got this Saharan Dust bloom coming for Nashville, so you get to add that to your list of experiences. So, I hope you get a break here at some point soon. Susan, let me turn to you again as a fellow CEO of a large and very diverse membership organization with your members ranging from very small companies to very large intergalactic companies. You know, given this diversity, I guess more focused on sort of the ACLI itself as an organization.

How are you doing and what are you doing to really adjust to sort of the current reality, particularly around your members support and advocacy?

Susan Neely [00:08:36] Mike, it's such a good question, and I think like the commissioner and Karen, I can answer unequivocally that we've made a seamless transition and possibly are even more productive than ever because of the ability to be so focused. We're not getting on planes. We’re not staying at hotels. We're not doing all the things that can be a distraction. And still we're getting so much done. I care and I come from the era was just not how many hours you love that made you productive, but also being seen for all of us who wanted the boss to know that you are really a to be seen as an up and comer and an eager beaver. You want to get in the ring before the boss. If that was 6:00 in the morning, you did it and you'd stay, you know, 8:00 or 9:00 at night. I think we may be working those hours now, too, but we're doing them from our kitchen table or our family rooms or our patios. So, we have done very well working remotely. I would also say just because you and I've talked a lot about just sort of how you change the culture of an organization and build capabilities and nimbleness all the work we've been doing in that regard since I came on as CEO two years ago has stood us in very good stead. Certainly, we made a big investment in technology a year ago that has allowed us to have the hardware capability to be connected to all the work we've done to bust down departmental silos and foster innovation deep in the organization. And to upend that old command control way of working has really, really been important in this crisis footing that we've all been working on so we can leap into action on behalf of all those member companies that you referenced Mike and work with Commissioner Mainda and Governor Lee and all the states that make sure that we were declared essential services and, you know, work with you to achieve some of the temporary accommodations that have been so important to keep the whole enterprise, the whole sector doing what it needs to do. And I'm grateful we made the effort to achieve the cultural change that allowed us to really hit it out of the park, if I say do say so myself on behalf of the team to support what the industry is doing in this time.

Mike Consedine [00:11:04] Thanks, Susan. And I think you all have mentioned, you know, that the increased level of productivity. I wonder, though, if we're sort of creating sort of the next generation of workplace counseling issues where your home life and work life kind of meld together in the days seem to be sometimes endless. But I guess that's something we'll have to work through as we progress through this new normal. And speaking of the new norm, I think that's a term that we we've all been hearing and struggling to define.

I'm really interested to hear your particularly well informed insights on how you think that new normal that new world is going to be different than the one that we departed from back in March of this year. Are they going to be mostly cosmetic and possibly fleeting changes, or are we truly talking about some fundamental shifts in life insurance, in NIPR operations, in state government operations

So if you all break out your crystal ball and maybe Susan. I'll start with you...

Susan Neely [00:12:21] Well, Mike, we are, we are doing our best to break out the crystal ball or try to see around corners. And I don't think we have answers yet, but it always starts for all of us by anticipating where in particular, from our standpoint, the policy debates and the issues may be going so that we can think through now what our answer is and our position should be. We spend a lot of time thinking about how we can always have four positions. We don't want to just come into the commissioner and all the NAIC members and say, here's why we don't like something. We know you want to be problem solvers until what can we offer? So we are doing some work to see around corners. I don't have the answers, but I'll tell you kind of what we're seeing. You know, first step and very much in in the NAIC's wheelhouse, we were grateful for some of the temporary regulatory accommodations we've gotten so we can continue to operate and serve our consumers and the citizens and people in your states. And we're hoping we've created some proof of concept around temporary producer licensing and doing licensing on a virtual basis. E-remote notarization, e-signature, regulatory filing flexibility. Some of those things you granted, which we are so grateful for, and we hope we have some proof of concept that some of those things could be permanent because we think we've proven that the consumer is protected. We've also our demonstrating that these things are just easier for the consumer and we can get more producers licensed so they can be out there with good jobs supporting people in their financial security needs. The other thing we're seeing around the corner is that, you know, none of these things are new, there are issues that have just been brought into sharp focus because of the pandemic. And those are the issues of individual financial security. We had coverage gaps and gaps in access to retirement security vehicles. We had gaps in paid family medical leave and support for workers who have to be caregivers and have income replacement for that. Those we had savings gaps, people with inadequate savings. Those old existed before the pandemic. Well, now they're right out there in our face. We have to think about what to how to resolve this as a country. Policymakers, there's bipartisan concern, which is good. Let's always start with that. And we need to you know, redouble and triple our efforts to figure out what the policies are that will help fill those gaps. And so that's what we're thinking about. How can we be part of the solution in that regard? And have to help the American economy recover, where are the long-term patient capital. We invest in infrastructure, so we're looking for those opportunities and policies to further that. And then the other issue, that's the other crisis that's front and center is, of course, the crisis around racial injustice, the economic inequalities and disparities that underpin that. And we're thinking about that as well. So, for those of us, I think it's everybody in this discussion who want to be relevant, there was a big continued leadership opportunity. And I look forward to figuring out what some of the answers are to these things. But that's what we see coming.

Mike Consedine [00:15:37] Yeah. And I think so many of those are great opportunities for us across the sector to work together, so we to look forward to that.

Karen, I'll turn it over to you next. I'm guessing a number of the things that Susan mentioned, you know, particularly technology related, resonate with you, because as we've discussed, you know, there are aspects of NIPR operations indirectly that rely on sort of physical touchpoints, be they exams or fingerprinting. So maybe, again, your perspective on the new normal for NIPR and maybe sort of the producer licensing community.

Karen Stakem Hornig [00:16:14] Yeah. Thanks, Mike. You know, we've talked a lot over the last five years or so about digital innovation in the insurance space. And we've been to startup conferences and spoken to innovators. And often you would hear the industry criticized for being slow to adopt a digital approach to both delivery of insurance and also aspects of this of the supply chain or the business processes around insurance. And boy, do I think this experience has given us just a seismic shift in terms of digital adoption in some of the things precisely that Susan mentioned. One of the big pain points for industry has been getting people onboarded at a time when that process is actual, being in a physical place is required for parts of that process. So, going forward, it's going to be that constantly balancing streamlined electronic processes, always with consumer protection that I know the industry and of course, regulators are our most are most concerned with. I think that's going to be an absolute reality. And I do think that this is a unique opportunity for the industry because consumers are much more focused on risk mitigation. And I think more open to the value of insurance and the value of a financial stability. So, I think, you know, we're going to see process change and improvement, but there's also, I think this very significant opportunity for the industry to highlight its value to individuals and to the economy. And so, I think I think it's very exciting. You know, I always balance that with knowing that as humans we have a notoriously short memory. But I do think that the impact of this global trauma and its economic fallout, I think it genuinely will drive fundamental shifts.

Mike Consedine [00:18:52] Completely agree.

Commissioner Mainda the balancing act that Karen just referred to between consumer protection and solvency monitoring, you know, with sort of the realities of our current situation, the potential need for new efficiencies. How are you seeing that impacting how you do business at a state level going forward?

Commissioner Hodgen Mainda [00:19:15] Yeah, those are great points that have been made, Mike, by Susan and Karen. Well, I'll start off by the biggest takeaway from COVID-19 pandemic that we have learned is flexibility, I think. From the health carriers and the property and casualty personal line carriers and the rest. The impact from losses was much different than anyone had frankly predicted and projected. Furthermore, the pandemic also made it clear of how of the importance, Mike, of communication between the states. And here's where I will take a second to really applaud the NAIC on how we've leveraged technology and made sure that we've had frequent enough meetings where we we've had great dialog from regulator to regulator on best practices and shared those best practices. And obviously each state's approach through this has been different, but we've been able to get best practices and tweak them to how best it would fit our state. From a policy perspective, it's uncertain what that's going to look like. I'm going to give an example of what we did in Tennessee. The governor issued an executive order about restaurants being open and being only open to do delivery and pickup service. And so, again, thanks to the NAIC, who were able to pick up on what other states had done in regards to being innovative to where we asked and provided guidance to the P&C carriers in order to work with those restaurant owners, because majority of those employees who were delivering food were probably servers and not on the restaurant owner's policy. And so I say that to say, I think even though the future is uncertain, it's forced us, COVID has us forced us to look at our policies and being able to adapt with the changes back to the flexibility word that I used earlier. There's uncertainty, but I think you're going to see innovation and frankly, looking at our policies and tweaking them as we reopen the economy and at least keep an open mind and be flexible and be able to adapt to the changes that we'll foresee in the days ahead.

Mike Consedine [00:21:46] Well, thank you all for those excellent comments. And it certainly seems that we still have our work cut out for us in being agile and resilient and doing the pivots that are necessary. But it's gratifying to hear that you all are thinking ahead and around those corners.

Usually here at this point in our podcast, we have a little fun and play a game of regulator risk roulette, but I think we all have enough risk going on in our collective lives right now. So instead I'd like to just wrap up by inviting each of you maybe to share that one moment you've had in the last four months. And I know it seems a lot longer than that. You know, that kind of serves as that personal aha or oh shoot moment where the reality of all of this has settled in.

I think, you know, for me it was a day in early March where we made that very tough decision to cancel our spring national meeting in Phoenix, which for the NAIC, which has had national meetings in the midst of pandemics before and certainly following other natural catastrophes. That was you know, that was a big decision. It was absolutely the right call. But, you know, as we talked about it internally, that was kind of our pivot point where it's like, well, to 2020 we thought we were going to have is not the 2020 have so we'd better start adjusting and adjusting quickly. And we did. But sort of, again your personal moments. And Commissioner Mainda, I know you've probably had a lot of those, but I'll turn to you first.

Commissioner Hodgen Mainda [00:23:17] Thank you, Mike. So, just, my background was not from the insurance industry, and so I've been on the job nine months now. My aha moment was the first week of March. We had the tornadoes, so the first tornado came March 2. The first COVID case was confirmed on March the 5th. We were issuing guidance and bulletins and participating with other governor’s executive orders. Mind you, I am probably at this time six months in on the job, not from the insurance industry and still taking in a lot. My aha moment was my staff. I never underestimated my staff, but from what I just briefly explained, I quickly realized how fortunate I am to have surrounded myself with subject matter experts and just dedicated and loyal state government employees. We've been resilient. It's shown me, I've seen it firsthand, in the face of a year of adversity with what I just named the tornadoes, derecho, and, of course, COVID-19.  Again. I don't think I would be where I am right now and though we still have a lot to do if it were not for my staff and I'm forever appreciative of what they've done.

Mike Consedine [00:24:46] No, I mean, that's just such a great observation, I think, for any of us again, sort of as heads of organizations, we would not have made it as far as we did without the sports of the amazing teams that we each get to work with every day. And realizing that I think is for all of us is probably an important moment.

Susan, what about you?

Susan Neely [00:25:10] Well, it's interesting. You mentioned your pivot to a WebEx format for your March meeting, because I think that began my aha. I was privileged to be one of the panelists on how the industry is responding as the pandemic was just unfolding. And how many people did you have on that? Participating on that?

Mike Consedine [00:25:30] 3,700. Which yeah, for us, you know an average national meeting in person is about two thousand. So yeah, that was significant.

Susan Neely [00:25:38] Well that was the aha. And since then I've been on as speaker or panelist with a 1,000 people. 1,300 people. 700 people. We had our annual June board meeting last week, we had 100 hundred percent participation from the board, and we had, you know, 90 other CEOs listening in. We would never have that. It was an in-person meeting. This we cannot let the value of the connectivity that that video and virtual technology provides us. We can't let that go going forward. Now, how that gets reconciled with all the personal relationship building. So many people have said to me, this is a people industry and that's why we go into it. And it's true. It's one of the great things about it. So how the need to touch people physically gets inter-connected with the ability to touch so many people virtually. It'll be a big question for us to figure out. But it's I think it's exciting. I mean, I've talked to thousands of thousands of people in the last several months. I've never left my house, for better or worse.

Mike Consedine [00:26:45] I think you're right. The paradigm has definitely shifted in terms of how we interact. And I sense that we probably won't be going back to our old way of doing things, particularly when there is a benefit of being able to reach out and get our message out to so many more.

Karen, I'll turn to you finally. And I said a personal level. I just have been hugely impressed by sort of your leadership and engagement on behalf of NIPR and its teams throughout this. You always seem to be kind of one step ahead in terms of anticipating some of these pivots. So, you seem to be having these aha moment sooner than some of us. But I'd be interested in hearing about your most significant one at least.

Karen Stakem Hornig [00:27:28] Well, I mean, you're very kind, Mike. And I don't know about everybody else, but these 15 weeks have like self-discovery boot camp or something. I mean I feel like, you know, you learn something new about yourself every day. But one really key takeaway for me is sort of a combination of Susan and the Commissioner's answer and that has been about my team and about organizational culture over the last several years. We've done a lot. And Susan mentioned this in answer of the first question about the investments you make in your culture around building trust and teamwork and the high levels of employee engagement. And boy, has that paid off. Just like the Commissioner said, the NIPR team has so exceeded my expectations. I would have never anticipated that things would have gone as smoothly. And now the challenge is here we are at this critical moment where the ground seems to shift under our feet every single day, whether you're talking about COVID-19 or a national response to racial inequity. And now how do you continue to build a strong, connected organizational culture as we transition into what's going to be this new reality? And I think that is going to be the fundamental leadership challenge for people who are leading organizations. And I don't have any answers, but I know that that's something that I've got to spend a lot of time thinking about.

Mike Consedine [00:29:18] Yeah, what great comments. I mean, I certainly appreciate you all sharing those stories. You certainly have given all of us and all of our listeners a lot to think about in terms of the leadership challenges, but I also think the opportunities that leads towards for all of us. And thank you, our listeners for joining us during this special episode of The Regulators. Please continue to join us each month and subscribe to The Regulators wherever you get your podcast. See you next time.

About the NAIC

As part of our state-based system of insurance regulation in the United States, the National Association of Insurance Commissioners (NAIC) provides expertise, data, and analysis for insurance commissioners to effectively regulate the industry and protect consumers. The U.S. standard-setting organization is governed by the chief insurance regulators from the 50 states, the District of Columbia and five U.S. territories. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer reviews, and coordinate regulatory oversight. NAIC staff supports these efforts and represents the collective views of state regulators domestically and internationally. For more information, visit www.naic.org.

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