Risk

Martin Gets an Offer

Martin could not believe his eyes when he saw his file appear on the Large Loss listing from head office. How on earth did a small break-in get to be over a hundred grand? But there it was: Ultimate Diecasting - $120,000 reserve. This thing was a nightmare from the start and now he had to complete a Large Loss report for the higher-ups that they would all be scrutinizing and talking about. He didn’t really want it associated with him at all, let alone have it define the quality of his underwriting. This policy file wouldn’t stand up to much scrutiny. He barely had it entered on the system and now this.

Thinking about the circumstances of the loss got him going in circles all over again. What weren’t they getting here? Something was missing or he would understand it better. He didn’t like not understanding risk; it made him feel out of control. There wasn’t enough premium in the world for a risk that couldn’t be quantified and, preferably, rated per hundred dollars of coverage.

The way underwriters understand risk is based on history, by class of business. So for every machine shop there had ever been across Canada, the Insurers Advisory Organization kept track of every claims dollar that was spent on fires, break-ins, windstorm and water damage, etc., for the whole group. Then this amount is compared against the entire amount of property coverage at risk and a rate is developed per hundred of coverage. Where underwriting comes in is in applying critical judgment to decide what credits or surcharges should apply to the base IAO rate considering factors that bring the risk closer to the best of class or to the opposite end of the spectrum. Not knowing all the factors kept an underwriter awake at night. Which meant that it was time for more coffee.

Pouring himself a cup and then reading the list of postings and health and safety bulletins, chatting with Holly and then sauntering back to his desk, checking voice mail and taking note of who wanted a piece of him. The crisp new file was still open on his desk. On the surface, it appeared to be a good risk. All the security and protection was there. But something strange happened when thieves broke in and didn’t steal the things that had the most obvious value, which meant there was something of value they were looking for that Martin didn’t know about. He tried staring off into space for awhile to see if it would come to him.

“Hey, Martin. It’s me, Reality. I’m calling you. Hello?”

Martin snapped out of it and saw that George was leaning against the wall of his cubicle. Thank God, a diversion.

“George, my friend, how are you?” said Martin, standing.

“I’m all right. How about you?”

“I’m three coffees over my quota and it hasn’t helped.”

“Sorry to hear that. I think packing a courier envelope is exactly the therapy you need.”

“When isn’t it?” Martin said as he started towards the mail room, George falling in step beside him. “We have a ship’s anchor that needs to go to the Port Credit marina. You up for it?”

“Sure, if you can afford it. Strap it on me, pay me the eight thousand bucks and I’ll be on my way.”

Martin laughed and grabbed the entire pile of mail, just jamming it all in the envelope. He pulled the adhesive strip off the envelope, sealing the mad jumble of paper inside. He didn’t even bother to sort it by department. Didn’t feel like it. Felt like nothing more than a cold beer sliding down his throat right about now. He handed the envelope to George, who stowed it inside his satchel.

“Hey, how about that drink tonight?” said Martin. “You up for it?”

“Um. Yeah. Why not? I could really use one.”

They walked to the front door, George putting on his sunglasses.

“Great,” said Martin. He could taste the beer already. “Where do you want to meet?”

“Someplace casual. I’m not exactly dressed in my executive grubs today.”

“How about East Side Mario’s over on Front Street?”

“That’ll work. Say, 6 o’clock?”

“I’ll be there,” said Martin. He waved as George passed through the double doors on the way out. He walked back in the direction of his desk trying to settle on something he could do between then and 5 o'clock that didn't have anything to do with Ultimate Diecasting.