Starting with this posting and occasionally thereafter, Jackspotpourri will be including a quiz. Here’s one to start with. The answers will appear in the next posting in a few days. Watch for it, and please, don’t cheat by ‘googling’ for the answers.
JL
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Quiz Time:
Quiz
#1: There are eight States in our
country beginning with the letter “M.”
Can you name them and their capital cities?
JL
* * * *
The Insurance Business
Insurance
is a good business in which to be. I
don’t mean selling it though. Insurance
agents, no matter how professional they try to be, are paid on a commission
basis, and that is never forgotten as they try to fill the needs of customers,
the search for which is always a major part of their job, particularly if their
major product is life insurance. Life
insurance people usually make a big commission up front in a policy’s first
year while property and casualty agents get smaller commissions, but these
continue on, year after year. Bottom line: Essential as they may be, they are still basically salespeople.
It's the
insurance company itself, though, which is the real money-maker. Agents come and go. Companies endure. Not having to worry about
merchandise or an inventory, they sell products (life, health, property,
casualty insurance, etc.) which, no matter how they are sliced or diced, are
guaranteed to be profitable. They know
how much they need to pay the claims that company-wide and industry-wide
studies tell them will occur on both a short and long-term basis. They know how to determine those whose
business they want and those whom they would be better off declining to have as
customers. They know how much they are paying agents and agencies to acquire the
business that produces the premiums.
They know how to conservatively invest the premium money they receive and
hold to cover these outlays as well as the cost of running the entire operation,
including management salaries and leaving a tidy profit.
 |
| Met Life Building in NYC |
This conservative
investment aspect of an insurance company’s operation causes some to refer to
them as ‘cash cows’ and make them attractive acquisitions by companies outside
of the insurance industry. And if they
are wrong with their numbers despite their having their own actuaries or hiring
actuarial consulting firms to make sure they are right, they still purchase
‘reinsurance’ insurance from other companies which specialize in this type of
coverage just in case their numbers turn out to be wrong or overly
optimistic. An insurance company has to
be really stupid not to be successful. Insurance companies which get into trouble are
usually those who have former successful sales executives as their presidents
or CEOs, rather than investment people or number-crunchers.
(Sometimes
companies falsely call themselves ‘insurance companies' when they are merely
insurance sales agencies or insurance sales components of a larger financial
services operation. Beware of them. They may be part of the insurance industry
but they are not ‘insurance companies.’)
Insurance
companies, if you weren’t aware of it, are regulated by State governments and
not the Federal government. This has its
greatest impact in property and casualty insurance where automobile and
homeowners’ insurance rates are determined based on the statistics from that
State alone. Profitable business from other parts of the nation is not used to affect
the rates in States with particular hazards such as hurricanes, forest fires
and hundreds of law firms advertising on TV specializing in milking insurance
companies for every possible penny. Of
course, rates in such States, where major insurers do business through separate
subsidiary companies, go up annually to cover these “hazards.” That’s why people moving to such States
sometimes experience insurance “sticker shock.”
It
doesn’t matter if you buy your insurance from a green lizard, a guy in a red
shirt hanging out with football players, a distinguished gentleman wearing a vest and looking like
the curator of a museum, a bunch of people dressed as if they work in a bakery, a bumbling band-aided troublemaker in a suit, an annoying man with an Australian bird, or just some folks at the
southern tip of Manhattan island, it’s all the same crap. I know. I worked in that business for over 40 years. And the companies never lose, even the one that has a jingle saying it is on your side.
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When I
was growing up we used to have a telephone sitting on a table in our foyer. The
company which provided us with it back in those days was the New Jersey Bell
Telephone Company, I assume part of the “Ma Bell” family. Below the telephone was a shelf on which sat a
fat telephone directory about four inches thick which was filled with
residential and business numbers, the latter on yellow pages. Eventually, we
had an extension which enabled calls to be picked up in another room as
well. Back before my time we had shared
a line with others whose calls to their numbers also came through that same line. That was called a ‘party line’ but they
eventually became unnecessary as more lines were installed. Until they were totally eliminated though,
they were cheaper to have. Also, there were ‘unlimited’ and ‘limited’ prices
for phone service too, the latter
providing only a certain number of calls. Going over the ‘limit’ was costly as
were all calls outside of the local area.
Hence, such ‘long distance’ calls were kept to a minimum. But things are different today. One can call anywhere in the country without
an extra charge.
We still
have a similar phone in my home today. Looks different though. No 'dial' of course, just buttons. It has three extensions in different rooms and it also can record a
message if the caller wants to leave one.
It doesn’t come in via a wire as it did in the old days; it is part of
an internet service to which I subscribe.
I rarely pick up that phone when it rings because most of the calls
which come in on it are unwanted junk. When I recognize the name of the caller,
which shows up on a screen on the phone, I might pick it up. When I don’t pick it up, the caller hears a
message telling them to call me on my ‘mobile’ phone or send me an email,
without giving them the ‘mobile’ phone number or my email address. They can leave me a short message if they
wish to in the rare instance where the caller happens to be someone I really
know, but who doesn’t have my ‘mobile’ number or email address. Usually they are not.
 |
| I call it a landline, which it ain't |
Once in a
rare while, I pick up an incoming call from an unknown source which looks like
it is for real. Sometimes it is, but usually
it is not. An example might be a call
from my congressional representative or Senator to whom I had written or an
emergency power outage or weather announcement.
Picking up calls from numbers one doesn’t recognize can result in one’s
number being stolen for use in making unwanted junk calls to others as well as
increasing the number of junk calls coming into that number. It can also open the door to identity
theft. A deluge of unwanted calls
usually wears off in a few weeks or so.
Listing the number with the Federal government’s ‘Do Not Call’ list has
little effect. Many people I know,
especially the younger ones, have given up on this type of telephone service
entirely and totally depend on their ‘mobile’ phones. Right now, I still like having it as a
‘back-up.’ service.
 |
| My IPhone 11 |
Although my ‘mobile’ number is also listed with the government’s ‘Do Not Call’ list, several unwanted calls come into it each day, which probably result from my having accepted one which I should not have, but the number of which looked familiar, but without a name showing up on the screen. (I’ve occasionally received such ‘mobile’ calls from unfamiliar locations which I routinely deleted until I realized they were the ‘mobile’ numbers of a someone I knew, secured before they moved to Florida.)
Picking up calls from unfamiliar
numbers is a much riskier thing to do on a ‘mobile’ phone because of its
internet connections and since there are many illegitimate groups actively
stealing (‘phishing’ they call it) numbers to use to reach other ‘mobile’
phones, which can be the first step to identity theft. When you pick up such a call and there is no
one there, it means they were just trying to get you to pick up your phone. The
‘connection’ was all they wanted, and that’s how you ended up a week later,
getting a batch of strange calls from places like Boise, Idaho or Jackson,
Mississippi, which are of course to be ignored.
Sometimes
I wish things were as simple as they were when we just had one old-fashioned
phone with a rotary dial on a table in our foyer.
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See! An entire posting without any politics or Covid19 advice.
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