The Not Unreasonable Podcast

Danny heads up D&O, E&O and Cyber in the US for Trans Re, one of the market leaders in each line. In this episode we run through all the big issues in D&O:-Silicon Valley Bank and bank runs and how Directors and Officers liability underwriters are incorporating lessonsDana Hojnowski’s favorite claim. (0:00)What’s wrong with securities fraud allegation? (2:42)How do you know when a company is violating their duty of care to their shareholders? (5:14)What are the lessons learned from Silicon Valley Bank as an underwriter? (7:51)What would happen if a company didn't buy D&O? (9:36)How is the US different from other countries in D&O litigation? (13:00)D&O and crypto (15:13)The resolution of the D&O puzzle of Special Purpose Acquisition Companies (SPACs)? (18:28)Where has insurance made better risks? (24:19)The cyber loss is going to come from someone trying to hack you -. (25:59)How did you get into this kind of business where you're from? (28:11)youtube: https://youtu.be/6XLjsp67UFETwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Amy Finkelstein is Professor of Economics at MIT. Amy’s research focuses on market failures and government intervention in insurance markets and she has won numerous awards include a MacArthur Fellowship and the John Bates Clark Medal. Amy is co-author with Liran Einav and Ray Fisman of the forthcoming book: “Risky Business: Why Insurance Markets Fail and What to do about it”.Buy the bookhttps://www.amazon.com/Risky-Business-Insurance-Markets-About/dp/0300253435/Amy on wikipedia https://en.wikipedia.org/wiki/Amy_Finkelsteinepisode on youtube: https://youtu.be/nvVlNSolE3sshow notes: https://notunreasonable.com/?p=7706When is government compelled insurance a good idea? 0:02How the public option or the mandate can create two different equilibria in the market. 8:53Dental insurance isn’t really an insurance product. 13:27The subsidy is not an objective, it’s a problem. 19:18How do we choose whether to pay attention to some of these issues or not? 25:47Why do we feel compelled to act when people are suffering from chronic conditions? 29:53What are the benefits of giving people cash instead of insurance? 33:44The problem of moral hazard in insurance. 39:51The concept of affinity and intermediation. 45:28Insurance can be learned the hard way. 51:02What happens when the price of insurance gets too high in compulsory markets. 54:46Why nobody ever wants to buy insurance. 1:01:06Some of the studies that contradict what you think you know. 1:05:23Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Nobody knew how to price volatility until now. I bet you're surprised! This isn't hyperbole, Steve Mildenhall and John Major have a deep and thorough understanding of all the relevant literatures and have been part of a loosely collaborative team of academics and actuaries working out the details of a coherent, actionable theoretical foundation for pricing insurance for their entire careers. Now that they're both retired they've delivered us the tome the actuarial profession needs. Their new book: *Pricing Insurance Risk: Theory and Practice* is an absolute masterpiece. It is theoretically sound and immensely practical. Until today no financial institution could choose a sophisticated portfolio model that wasn't hiding biases or inefficiencies that had to be 'band-aid-ed' over with coarse heuristics. Very importantly how does one calculate the margin required to service the capital base when the risks vary so much? The science of managing a portfolio of incompletely diversified, highly volatile financial instruments has gained serious ground with this book. Steve Mildenhall is head of analytics at Qualrisk, an Insurance consulting firm, formerly assistant professor of actuarial science at St. John's University, and before that CEO of analytics at Aon. This is Steve's fifth appearance on this show. John Major is principal at Major analytics and the former director of actuarial research at guy carpenter. youtube: https://youtu.be/ZQHpMVH7d9sshow notes: https://notunreasonable.com/?p=7694Steve and John did a tutorial on this material and more with some technical examples you can see here: https://www.youtube.com/@ermdiner/Here is a link to the spreadsheet used in the tutorial: https://docs.google.com/spreadsheets/d/1CV3sF52cjPH8mw6T4E-jOfCNDagCptRs4xBZTug8Z0A/edit?usp=sharingHere are some Not Unreasonable Podcast Episodes about related content:Samir Shah on Innovating Capitalhttps://www.buzzsprout.com/126848/8171216andSteve on the Macro History of insurance Part 1:https://www.buzzsprout.com/126848/8121657And Part 2https://www.buzzsprout.com/126848/8507268In the show we cover:How do you think of the cost of running the capital side of insurance?2:06The importance of connecting the value to the value of the original customers.5:18What is the value of reinsurance?7:34The timing of Hurricane Andrew relative to the early cat models.18:44The history of cat models in the 60s.21:22What the CEO’s are disagreeing about in volatility?33:04What could possibly justify 50% margins in these companies?42:59What doesn’t make sense about the intentionality argument.46:28What is the market price for risk?48:02The difference between allocating capital vs. allocating margin.1:01:39What’s the right metric for determining performance of a reinsurance company?1:08:07The further removed you get from loss, the cheaper the capital is as a percent of capital, but the more expensive the insurances are.1:22:59How long did it take for these ideas to emerge? How did they evolve?1:24:55The key to unlocking a lower cost of capital1:29:07What is the required return in a regulated environment?1:32:55The amount of leverage you get is huge.1:48:24Steve’s envelope theorem and how it works.1:53:18What’s the insight that underlies the ability to determine bounds for spectral measures?1:56:46Characterizing the worst risk-adjusted expected outcome.Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Mark Friedlander returns to talk through the changes to Florida's insurance laws. It's just about the most comprehensive reform anyone could imagine, even if all it does is put Florida residents on a similar footing to many other states!Assignment of Benefits Removal won’t be enforced until January 1, 2023.3:35What’s the risk of a political backlash from insurance companies?8:52The problem with the May special session was the senate was willing to take the similar steps that were just passed, but the House leadership was against it13:38What’s next for reinsurance in Florida?16:59How does the legislature pre-commit to not going “crazy” in 10 years?19:51What are the policies that go to citizens and there are some changes to citizens as well?DaveDeMott of Stories of Florida Insurancehttps://www.buzzsprout.com/126848/11840226Gary Mormino on Social History of Florida: https://www.buzzsprout.com/126848/11848870Mark Friedlander on Problems with Insurance in Florida: https://www.buzzsprout.com/126848/11582094Joe Petrelli on Rating Florida Insurance Companies: https://www.buzzsprout.com/126848/11547382youtube: https://youtu.be/8Bfkrbiazxwshow notes:  https://notunreasonable.com/?p=7667Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Do you think Florida is weird? Most everyone does. Why? Gary is the man to answer this question. Gary is Professor Emeritus of the University of South Florida and has dedicated his career to studying the social history of Florida. Here is Gary on wikipedia  Here is Gary on Amazon Quote of the show: "Do crazy people immigrate to Florida or do perfectly normal people come here, and then be a little goofy and go crazy."What is the most unusual social characteristic of Florida? 0:00What are some of the most distinctive features of Florida? 9:37Florida’s “Florida Man” reputation. 15:49California and Florida are neck and neck in population density growth in last 100 years. 24:51Florida is running out of options for reinsuring barrier islands. 35:55What it costs to live on the coast in Florida. 40:18How is Florida a Ponzi State? 42:28What’s the real alternative? 46:55What are the similarities and differences between Florida and other states in terms of immigration? 53:49How the Cuban vote has been a solid republican vote since 1961show notes: https://notunreasonable.com/?p=7659youtube: https://youtu.be/WT0iS-sDa54More on Florida: Dave DeMott's Stories About Florida Insurance: https://www.buzzsprout.com/126848/episodes/11840226 Mark Friedlander on Problems with Insurance in Florida: https://www.buzzsprout.com/126848/episodes/11582094Joe Petrelli on Rating Florida Insurance Companies: https://www.buzzsprout.com/126848/episodes/11547382Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Dave DeMott is President-Elect of The Florida Surplus Lines Association, Chair of the Legislative committee and sits on the national Wholesale & Specialty Insurance Association committee.Most importantly for today, Dave DeMott is a real, legit, on-the-ground insurance practitioner in Florida. He gets into the real details and war stories about insurance claims in Florida. Dave’s introduction to the Florida insurance market. 0:00What is a lodestar fee multiplier? 5:23The problem with AOB 12:29What work is being done to curb predatory behavior by carriers? 19:03Water damage and leaky roofs  23:15What’s the distinct about Florida? 29:28Lobbyists have their golden opportunity.youtube: https://youtu.be/G7iGuLLZNwkshow notes: https://notunreasonable.com/?p=7654More on Florida: Mark Friedlander on the Florida Insurance legislation of Dec 2022https://www.buzzsprout.com/126848/11907447Gary Mormino on Social History of Florida: https://www.buzzsprout.com/126848/11848870Mark Friedlander on Problems with Insurance in Florida: https://www.buzzsprout.com/126848/11582094Joe Petrelli on Rating Florida Insurance Companies: https://www.buzzsprout.com/126848/11547382Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

I worry about whether we can improve the insurance system. I once wrote an essay arguing that all insurance is compelled, so the only way to get someone to buy insurance is to force them to do it. The implication is that nobody will ever do anything good without being forced. We learn some lessons the hard way but then quickly forget. What's more we hate this compulsion! We chafe at the rules and many of us shirk them when we can. It's a mess. Joe Edelman has a better vision. In his vision (in my words), we have values that give us a sense of meaning. Connecting with other people who share these values is (should be) our social objective. Groups anchored around values will develop norms for deepening the pursuit of these values, norms we'd gladly accept because the values are so meaningful to us. Norms are another way of saying "social rules we live by" and the minute you are putting rules down you are constraining some actions and, even if only by negation, compelling others. If we can create a system where rules are embraced rather than resented, we can create a vastly superior society than we have today. Listen for our discussion of this! Joe's homepage: https://nxhx.org/youtube: https://youtu.be/Sjennrn5LNAshow notes: https://notunreasonable.com/2022/10/28/joe-edelman-on-designing-meaningful-thingsTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Mark Friendlander is Director of Corporate Communications at the Insurance Information Institute a think tank focusing on insurance education. In this episode we dig into a bunch of detail of the ways in which the insurance ecosystem in Florida is doing Floridians harm and why the world is like that. What are the root causes of the fraud in Florida?What are the outcome?What happens if nothing changes?What are some special powers you have as an insured in Florida and how are they ultimately harmful?youtube: https://youtu.be/g63n9Kgq4CYshow notes: https://notunreasonable.com/?p=7641More on Florida: Gary Mormino on Social History of Florida: https://www.buzzsprout.com/126848/episodes/11848870Dave DeMott's Stories About Florida Insurance: https://www.buzzsprout.com/126848/episodes/11840226 Joe Petrelli on Rating Florida Insurance Companies: https://www.buzzsprout.com/126848/episodes/11547382Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Joe Petrelli founded Demotech, the rating agency that dominates the solvency assessment market for Florida's homeowners insurance market. This year (2022) he has found himself the bearer of bad news: that many of Florida's domestic insurance companies have not met Demotech's standards. At least six insurance companies went insolvent this year with others being downgraded, which meant that many thousands of Florida residents have to scramble to get their insurance replaced. I should note that all of this happened before Hurricane Ian, the costliest hurricane to make landfall in Florida's long history of landfalling hurricanes. What's going on in Florida? Joe is here to talk about it!youtube: https://youtu.be/Cd9JpHsjDr8show notes: https://notunreasonable.com/?p=7636More on Florida:Gary Mormino on Social History of Florida: https://www.buzzsprout.com/126848/episodes/11848870Dave DeMott's Stories About Florida Insurance: https://www.buzzsprout.com/126848/episodes/11840226 Mark Friedlander on Problems with Insurance in Florida: https://www.buzzsprout.com/126848/episodes/11582094Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Brian Nosek, has been at the center of the two most important recent social revolutions in academia. First is implicit bias where Brian co-founded Project Implicit http://projectimplicit.net/ based on a pretty incredible idea: that we don't do what we say we value. The concept of implict bias has really taken off and the practice of implicit bias detection and training has gone "way out in front of the research" as we discuss.While he was busy kicking off a fundamental change in our society (felt very strongly in academia) he decided to upend (and massively upgrade) the culture of research itself by discovering that huge swaths of empirical research fails to replicate. I'm no academic but I would find this terrifying if I was. As Brian says in the interview: "in some fields, people still don't like it an email from me" because that means he's about to try to replicate their work!How was Brian able to pull all this off? There's even a technology innovation hidden in all this that makes his work possible. He's a true innovator and an honor to have him on the show!show notes: https://notunreasonable.com/?p=7611youtube: https://youtu.be/NkKuF--5V60Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

This conversation gave me such a feeling of humility yet hope about our world. It's an awful place sometimes but some people are truly awesome at making it better. Jen Brady is the Executive Director of Oasis, a non-profit serving women and children in Paterson, NJ and this is her second appearance on the show. In the first show we talked about COVID and the poor. This time we're digging right onto Oasis and its mission and how it's doing. Charity is incredibly similar to insurance. As I half joked once in comparing them: "One of them supplies resources to those in desperate need and hopefully enables them to pull themselves out of their difficult circumstances to lead a successful life. So does the other one." Insurers could do well to learn from Jen. And she has a remarkable track record, doubling the size of Oasis during her tenure and initiating many fascinating experiments and new initiatives in Paterson, NJ. We discuss:* How self-belief is the most important factor in women lifting themselves out of poverty* How that feeling of self-belief is constructed, influenced and nurtured in and out of Oasis* The difference between generational poverty and immigrant poverty* What is the drop out rate (I was astonished) and how do they manage drop-outs* Do the problems feel endless?* What did they learn by extending Oasis into housing development?* How to not create bureaucracy in solving problems* How they handle the cultural complexity of women and children from 26 different countries (plus Paterson natives!)* How the social consequences of COVID (lockdowns, etc) impacted poor families* How much talent there is hidden in places like Patersonshow notes: https://notunreasonable.com/?p=7567youtube: https://youtu.be/aWS7tSIe68QTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Chris Blattman is an economist and political scientist and author of several books, most recently *Why We Fight: The Roots of War and the Paths to Peace*.  This is another installment in my investigation for how to pursue social change.  What I notice about insurance is that the institution is so deeply encoded in our society that we don't even realize how important it is. So deeply encoded that we actually kind of hate it, yet it persists because of how important it is. What are other ways of pursuing beneficial social change? Persistent beneficial social change? Violent conflict is a pretty big, nasty problem. But what are its roots and what are its causes? What might need to change about our world to reduce it? What is the relationship between peripheral and central societies and how is that related to violence? All that plus tons on James C Scott and more!youtube: https://youtu.be/H-bcj1LJy80show notes: https://notunreasonable.com?p=7498Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Tyler Cowen is an economist, author, podcaster, venture and philanthropic sponsor. Tyler is one of my intellectual heroes, this is his third appearance on this program and we'll be anchoring this discussion around his new book *Talent: How to Identify Energizers, Creatives, and Winners Around the World* co-authored with Daniel Gross. Tyler blogs at marginalrevolution.com (I've been reading it every day for about 15 years) and hosts the only must-listen podcast in my player: Conversations with Tyler. Tyler is an inspiration!In the show we talk about:* Why the book deserves to succeed in a moral sense* Is Tyler moving away from academia? * What do I think the main connection is between Tyler and Daniel and how it informs this book?* What is the goal of writing this book?* What is the most important academic result... (ironic, I say!)* Why should Tyler's podcast guests be scared? * Is bias good or bad?* The list of tools available to those in power law businesses has grown!Book link:https://www.amazon.com/Talent-Identify-Energizers-Creatives-Winners/dp/1250275814show notes: https://notunreasonable.com/?p=7478youtube link: https://youtu.be/mr2jrM0fkt0Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Howard Kunreuther is the foremost authority on applying behavioral economics to unlikely, high consequence events. I remain astounded that Howard's teachings are not part of the educational canon for all insurance professionals. This is important stuff!In this episode we discuss:* Cognitive bias and how it impacts society generally and insurance in particular* How we might overcome cognitive bias in our decision making* Prioritization of risk* How politics really is the mediating force for discussing risk* Does voter irrationality give us cause for hope? show notes at:http://notunreasonable.com/?p=7470youtube link:https://youtu.be/wxSsddUAIFUTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Social science is brutally hard to do well. I once got a guest to admit there has been no progress on it ever and another one to say that moral progress is literally impossible. I think there's a deeper link to morality and social science than most so this is depressing stuff for me. This episode was part of an effort of mine to get back to first principles. But, uh.. what ARE the first principles of social science? Enter Robin!Robin Hanson is Associate professor of Economics at George Mason University and is back for his second appearance to talk about social science of very distant (in every possible sense of the term) societies. We have aliens, we have future humans, we have simulations. Robin speculates about things he can see today, things he thinks might happen in a century or two and even what might be going on in 1 million CE and perhaps beyond. As a frame for the show I think of it as trying to reason about what is permanent about social life by thinking of things that are weird and distant. Robin immediately disagrees with my premise and we go from there. We always learn from Robin Hanson, people!Show notes: https://notunreasonable.com/?p=7460Youtube link: https://youtu.be/oYCEo3LnGFETwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Stan McChrystal retired as a 4 Star General in the US Army and has since founded the McChrystal Group, written four books and launched a podcast. Stan is one of the world's foremost scholars and practitioners of leadership and in this conversation we focus on his latest book, Risk: A User's Guide. As I say in the interview, I think this is Stan's most straightforward how-to guide on leadership and we dig very deeply into the nuanced and fascinating connection between leadership and uncertainty, including:* What the history of military tactics can teach us about social progress* How hard is it to manage Special Forces? Why might it be different than other branches of the military?* When and why is Stan skeptical of using data to make decisions?* How does uncertainty reduction help you judge a leader? * How do we use morality to help guide us through uncertainty? Who are the best at this in the military?* What kind of information is toxic to decision making?And more! Show notes at:https://notunreasonable.com/2022/01/26/stan-mcchrystal-on-risk-and-leadership/Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

GA Bartick teaches people how to sell an underappreciated skill with very general applications. GA wrote a book called Silver Bullet Selling and in this conversation we talk about- how small organizations should scale their founders- Has sales changed over time- What is different about your industry?- How to make an emotional connection- How insurance is different!- Big ticket vs small ticket sales- Sales books are exemplary training manuals. How to teach, how to train?- Is sales training generating results? How do we know?- Do we hate practicing sales more than anything else?- Does sales training change your life?Show notes at:https://notunreasonable.com/?p=7336Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Scott Sumner is the Ralph G. Hawtrey Chair of Monetary Policy at the Mercatus Center at George Mason University and blogger at themoneyillusion.com and econlog and author of two books: The Midas Paradox and more recently, The Money Illusion. Scott came to prominence because his work on the Great Depression (published in Midas Paradox) gave him analytical superpowers for understanding the Great Recession in real time in 2008 and 2009 and beyond and in retrospect. We've seen the monetary policy establishment move closer and closer to the views Scott has been trying to talk them into for over ten years. Scott is one of those people who understands some very deep things about a very challenging subject. We can all learn from Scott!In the conversation we cover:- How might he design crypto monetary policy?- What matters more, revenue or wages?- Where does monetary policy end and fiscal policy begin?- Why isn't the fed more politicized?- How does Monetary Policy really work? How are inflation expectations set and how do they really matter?- NGDP targeting and how Scott's view has changed on it Show notes:https://notunreasonable.com/2021/11/26/scott-sumner-on-monetary-policy/Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

David Zuby is executive vice president and chief research officer for the Insurance Institute for Highway Safety and also a worldwide expert on crash test dummies! I found myself in an amazingly interesting conversation with David out in the field and pulled out my smartphone to capture it!In this quick chat we discuss:* the production economy of crash test dummies* what the challenges are in designing them* what are the limitations?* how long do they last?* Do you remember Vince and Larry!?Show Notes: https://notunreasonable.com/2021/11/26/david-zuby-on-crash-test-dummies/Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Craig is Head of ESG for Trans Re, a global reinsurance company and in this episode we dig into what ESG is about generally and what role reinsurers and the insurance industry plays today. In the episode we cover:* Is Trans doing this for the good of society or just to raise rates?* Is it just about catastrophe business?* Does it just mean you'll make more money on non-ESG-consistent risks?* What does a company that embodies the antithesis of ESG values look like?* Is this just a marketing strategy?* Is a marketing strategy actually a really good reason to do this, even in principle?* Does it make sense to have a separate ESG committee?* What on earth is the G about?And much more!Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Joe Henrich is Professor and Chair of Human Evolutionary Biology, Harvard University. He has written two books that have been incredibly eye-opening for me: The Secret of Our Success and the WEIRDest People in the World. Joe has put cultural evolution on the map as the best way for understanding why the world looks the way it does today. In the interview we cover:-How cultures are a statistical concept and what philosophers get wrong when analyzing culture-What culture 'wants' -What is the speed minimum of innovation?-Are there things we can do to accelerate cultural evolution further? -How should we analyze subcultures?-Is Insurance really the fundamental application for culture?Show Notes:https://notunreasonable.com/2021/11/26/joe-henrich-on-cultural-evolution/Youtube link:  https://youtu.be/ud-1rhQHnKETwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Mahbod Moghadam is the co-founder of Genius (formerly Rap Genius), co-founder of everipedia.org, and co-founder of ozone.ai. My words but Mahbod helped build Genius by being a controversial guy online. Controversy does not make you universally loved and Mahbod has "had beef" with a whole slew of who's who in the tech business. Some of it was real, some of it was show, all of it was catnip for the press at the time!Two brain surgeries and many years later and Mahbod strikes a very different tone about his life and approach to entrepreneurship. I wanted to talk to him because he's unique. I tried to steer the conversation towards Rene Girard's ideas which I thought might apply well to Mahbod's story. I still feel that way but it's hard to stay meta for long with Mahbod and we bounce in and out of his life narrative while covering the role of media in the construction of controversy, whether being controversial is a good idea even in retrospect, what it means to be an Iranian Jew in the tech startup world and don't worry, Mahbod hasn't jettisoned contrarian and original ideas entirely. Enjoy my ride with Mahbod!Show notes: https://notunreasonable.com/2021/11/26/mahbod-moghadam-on-controversy/Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Uwe Dulleck is a leading theorist on Credence Goods, a class of economic good defined by the fact that consumers can't verify the quality of what they've bought. Think car mechanics or medical procedures. Or insurance!Uwe's expertise doesn't end there of course and we talk about why people pay taxes, cybersecurity and some interesting ways Uwe has innovated on connecting academic work to real hard tech innovation. I had never heard to credence goods until a few months ago and it astonished me that there was a whole corner of economic thought devoted to consumers figuring out who to trust to get the right deal for themselves. It's an incredible and, in a world of ever-increasing specialization, increasingly important concept!Show Notes:https://notunreasonable.com/2021/11/26/uwe-dulleck-on-credence-goods/Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Bryan Caplan is Professor of Economics at George Mason University and for Bryan's second appearance we're talking about how voters aren't all they're cracked up to be in terms of their ability to generate good electoral outcomes. I have two interests in this work for Bryan. First, it's pretty helpful to have a sober literature-backed investigation into voter behavior in an era when politics feels like it's getting ever less functional. Second, I think there some deep ideas behind this book that inform how we make decisions in daily life. Politics isn't only confined to the ream of government, after all!Show notes: https://notunreasonable.com/?p=7297Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Jessica Leong is the President of the Casualty Actuarial Society and the Lead Data Scientist at Zurich North America.Jessica used her conversational Jiu Jitsu powers to make me talk a fair bit more than usual in this episode and it turns out I had some things to get off my chest about being an actuary!We discuss:-How do we define what an actuary is. There are different ways to approach this question!-How might we have thought about the defunct CAS SOA merger?-Are the exams getting harder? Why?-The culture of being an actuary-How does Jessica introduce herself at dinner parties?Thanks for listening!Show notes:https://wordpress.com/post/notunreasonable.com/7299Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Steve Mildenhall returns to talk insurance history! Int his follow up to our earlier episode we dig even deeper into data by different line of business and observe all kinds of interesting things:- which classes have more premium than claims volatility- statistical vs narrative analysis- how well can claims be forecast with prices?- how did the industry do?- which lines are more volatile and why?Check out the youtube video for the slides:https://youtu.be/HfF53eXFSGQTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Doug Hubbard is the author of several books and I've read two: *How to Measure Anything* and *The Failure of Risk Management*. I can honestly say that one of my career goals is to implement his methodology into my job today and everything I do in the future. Here's an incomplete list of wow realizations that I had reading Doug:That you can overcome cognitive bias in estimating variationThat we don't measure what's most importantThat we can quantify the value of informationThat we can quantify uncertainty and use it to make decisionsThat expert opinion can be calibrated and aggregated and use in a quantifiable mannerThat Bayesian statistics explain the reduction in uncertainty that accompanies additional information. That last one is an *empirical* observation. I remain floored by that. Floored. I didn't even cover half of what I wanted to cover with Doug. Read Doug Hubbard. Learn from Doug Hubbard. I will continue to!Show notes:https://notunreasonable.com/?p=7298Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Since joining the technology business I've had a whole variety of mental upgrades but Robert Hoekman has given me the chance to dig into what may be the most profound of them all: design. In the world of software we are confronted all the time with how feeble our minds are when tangling with reality. I think that the core mistake at the heart of bad software is that we humans are pre-programmed to believe our own BS. User Experience research lives and breathes human cognitive frailty and Robert Hoekman is an absolute master. He has written many books, in this episode we talk about The Tao of User Experience. A small, tidy phenomenal work that sits on my desk and from which I read nearly ever day. show notes:https://notunreasonable.com/?p=7320youtube:https://youtu.be/-lyxd9E4lJMTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

David is the founder of Ottrisk, a startup building technology to support the underwriting of business interruption Insurance. Previous to Ott-risk, David was a founder of Premise, a collector of ground truth data, where he remains Chairman, and co-founder of Metamarkets, acquired by Snapchat. David serves on the advisory board of Columbia University’s Institute for Data Sciences, was a punk rock musician in the 80s and almost got his PdD in Mediterranean archeology.https://www.ottrisk.co/https://notunreasonable.com/podcastShow notes:https://notunreasonable.com/?p=7317Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

This is a clip from my upcoming interview with David Soloff on the opportunity in business interruption insurance. David is the founder of Ottrisk, a startup building technology to support the underwriting of business interruption Insurance. Previous to Ott-risk, David was a founder of Premise, a collector of ground truth data, where he remains Chairman, and co-founder of Metamarkets, acquired by Snapchat. David serves on the advisory board of Columbia University’s Institute for Data Sciences, was a punk rock musician in the 80s and almost got his PdD in Mediterranean archeology.https://www.ottrisk.co/https://notunreasonable.com/podcastTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Samir Shah is Co-Founder and CEO of Ledger Investing, former Chief Reinsurance Office and Head of Capital markets at AIG. Samir started his career as a pension actuary and management consultant. I came across Samir at the tail end of my reinsurance broking career and his business fascinated me.If you were wondering why I've never gotten into a knock-em-down drag-em-out deepest dive imaginable into insurance capital and the constraints on innovating at the very tippy top of the chain, you are in for a treat. If you listen closely to this you'll see that we actually slide into some serious heterodox territory on several occasions: are capital markets actually more efficient for taking risk? Are insurance results uncorrelated to other asset markets? Is insurance capital not a commodity? If these are suspect what is the key to unlocking a lower cost of capital for insurance? Listen to see what Samir has to say!Show notes:https://notunreasonable.com/?p=7311youtube: https://youtu.be/diERmzI7YScTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

This episode marks the return of Steve Mildenhall, principal at Convex Risk, former Assistant Professor of Actuarial Science at St John’s University and former CEO of Analytics at Aon. This time, Steve is bringing an amazing dataset that he has developed showing the longest sweep of history in insurance I have ever seen. You can see the deck we go through here. This show is probably best consumed as a video, which you can see here. You can see show notes at notunreasonable.com. Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

I talk a lot about selling these days and was reminded of this moment from my conversation with John Shettle where he launched into an impromptu tour de force sales lecture. This experience really stuck with me. John was an operating partner at Stone Point Capital, a former CEO of specialty insurance MGA Victor O. Shinerer and held a variety of executive and leadership positions through is career. Sadly, I recently learned that John passed away last year. We all had a lot we could learn from John and I was very fortunate to have had a chance to capture some of it!notunreasonable.com/podcastTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guest for this episode is Otakar Hubshcmann, Head of Applied Data at Trans Re. The reinsurance industry is absolutely FULL of interesting data about insurance but there are a bazillion challenges of standardizing the data so that even expert reinsurance underwriters can make sense of it, much less machines and models.  This is Otakar's world! In the context of machine learning his is a modest objective, as he puts it:"The idea that you could have a machine come in or set of algorithms or whatever, take over from someone that's been in the industry with a learn domain expertise and a set of heuristics that are sort of proven over time, that just is not going to happen maybe ever ".But this is reality, folks. Most practical business problems really are beyond the frontier of what AI can meaningfully take over. All the more reason for companies to dig into the domain in house to figure out where the strategic gold is buried. Show Notes: https://notunreasonable.com/?p=7326Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guests for this episode are from Root Insurance: Matt Bonakdarpour, VP of Data Science, Alex Carges, Chief Actuary and Isaac Espinoza, who leads Root's reinsurance efforts. This episode covers everything that I, at least, have been burning to ask some people deeply steeped in the data science of auto rating. Does territory really matter? Does technology really matter? Actuaries vs Data Scientists? Do such distinctions matter in the limit? Listen in for more!Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guest for this episode is Alex Lazarow, VC with Cathay Innovation and author of OUT-INNOVATE How Global Entrepreneurs–from Delhi to Detroit–Are Rewriting the Rules of Silicon Valley. In this show we discuss:liberation of constraintswhether this is all survivorship bias (in either direction!)How innovation hubs might compete with one anotherHow the Silicon Valley model can be both wrong and rightHow frontier cultures can contribute or take away from startup successHow community minded entrepreneurs can beAnd more!Alex was a fantastic guest and like all of my most enjoyable interviews I was delighted to be surprised a few times by Alex's insights as he challenged me to learn even beyond my preparation for the conversation. Bravo, Alex!Show notes:https://notunreasonable.com/2021/11/28/alex-lazarow-on-frontier-startupsTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guest for this episode is Mary Hirschfeld, Associate Professor of Economics & Theology at Villanova University. Mary has a PhD in Economics from Harvard University and a PhD in Theology from Notre Dame. Her book, Aquinas and the Market: Toward a Humane Economy, is the book we as a society need someone with that background to write. We talk about what an alternative universe of economics might look like if designed by the famed Catholic Theologian. The cheap reading of her book can sound just like another bunch of self-help moralizing about us needing to consume less and live better. In our conversation I even challenge her a bit and say this isn't particularly newsworthy, so why write the book? Mary's mission is deeper, though, she's out there to give us some new, more effective intellectual arguments for *why* our lives should be lived better. Even though we may already be looking for more fulfilling pursuits than the old rat race there is a surprising lack of intellectual underpinnings to this set of ideas, especially the economics of these ideas. Mary Hirschfeld to the rescue. Let me know how you think she does!This show is part of an on-again / off-again series I'm recording about the philosophical and moral foundations of economics. See my episodes with Tyler Cowen on Stubborn Attachments and Agnes Callard on What Philosophy Feels Like!See show notes here! https://notunreasonable.com/2022/01/07/mary-hirschfeld-on-aquinas-and-the-market/Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Ken Brandt is the co-President of Global Underwriting at Trans Re and in this episode, recorded on June 3, 2020, we're talking COVID-19. In this episode we cover: What are good and bad outcomes for the (re)insurance market, (they're surprisingly similar!)How the insurance industry might get commandeered by the government to satisfy social aimsKen's observations on working remotely for the past 20 yearsWhat do we lose as a face to face industry with remote work?How pandemics are insurable and more!See show notes at notunreasonable.com/podcastIf you enjoyed this episode you'll probably also like other shows with reinsurance executives: Joe Taranto, Dinos Iordanou, Paul Ingrey, Mike Sapnar (Ken's boss!) and Bart HedgesTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guest for this episode is Jennifer Brady, Executive director of Oasis, a non-profit helping women, teens and children rise out of poverty in the greater Paterson, NJ, area, one of the poorest communities in New Jersey. We cover how the lockdown is leading to record-breaking demand for meal support from Oasis, how much more vulnerable this population is to disease, both because of their physical circumstances and because, believe it or not, it is only one among many life threatening things to worry about, what the political implications might be if COVID-19 becomes a disease of the poor and, of course, what we can all do to help.show notes at notunreasonable.com/podcast Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Michael Tanzer is a portfolio manager at a hedge fund called Callaway Capital and author of a newsletter I read each week call Stuff to Read Over The Weekend (STROTW). Michael asked me if we could hop on a call and talk about COVID and I thought I might try just putting this out as a podcast as an experiment. I might do more of these with various people as I struggle to make sense of this crisis, partly to get my own mind off the concerns I have for myself and my family. Let me know what you think!We cover a lot of my own current thinking about how insurance responds to this crisis and also models for economic and market disruption and how COVID-19 fits into all this. It’s an insurance-style crisis hitting the border economy? Show notes at:https://notunreasonable.com/2022/01/20/michael-tanzer-on-covid-predictions-for-insurance/Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guest for the latest episode is Christy Ford Chapin, Associate Professor of History at the University of Maryland, Baltimore County. Christy wrote *Ensuring America's Health: The Public Creation of the Corporate Health Care System*, which covers in enormous detail the historical origins of the US Health Insurance system. The central thesis of the book is that the American Medical Association was the linchpin player in warding off alternative payment systems for healthcare in the US. It's a fascinating idea and also serves as an excellent excuse to tour the origins of our system today. We cover much more including how hard it is to categorize the AMA's political stance in today's language, the variety of alternative systems in the early 20th century, how fraternal associations were the original insurers, whether the political diversity of the US was really to blame, whether Medicare would have been passed if JFK hadn't been assassinated and when the first worries about the cost of healthcare started to emerge.Christy's homepage: https://history.umbc.edu/facultystaff/full-time/christy-ford-chapin/Show notes:https://notunreasonable.com/2022/01/10/christy-ford-chapin-on-the-history-of-health-insurance-in-america/youtube: https://youtu.be/WlnYHVFwKhMTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guest for this episode is Monica Mason, head of catastrophe analytics as Trans Re. Catastrophe modeling is an analytical field of insurance concerned with predicting the cost of all kinds of natural disasters: hurricanes, earthquakes, tornadoes, floods, wildfires, etc.  We go very deep into the nuances of catastrophe modeling and touch on a few universal truths for complicated risk-taking businesses like reinsurance:- How reliant should you be on external vendors for IP that could save or destroy your organization?- What are the most valuable parts of these complex systems?- How well do duopolists respond to customer needs?This interview is one of a series of talks I recorded with reinsurance professionals at Trans Re after my initial show Trans’ CEO Mike Sapnar. I get really deep into reinsurance topics with black belts in various sub-domains: catastrophe modeling, reinsurance claims, medical malpractice, reinsurance underwriting and reinsurance finance. This is not an intro course, folks, more like a post-doctoral fellowship. Podcasting is a fantastic medium to sink your teeth into the topics insiders themselves struggle with every day on the job and I couldn’t be more proud to celebrate the intellectual depth and sophistication of reinsurance with you all. Show notes at:https://notunreasonable.com/?p=7394Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guest for this episode is Ty Sagalow one of the founding members of the Lemonade Insurance Group. Ty has held various underwriting and product development position at AIG over his 25 year career there and served as Chief Innovation officer at Zurich North America and Tower Group before joining Lemonade as its first Chief Insurance Officer.Ty wrote a book about his Lemonade experience called the "Making of Lemonade" which is the topic of the interview!We cover all kinds of ground in the conversation (innovation, starting a company, what were some innovation failures in Ty's career) but I didn't take long to get to the heart of the matter. The thing that distinguishes many tech startups of course is that their technology is so great. What is that like? Listen to the episode to find out and check out notunreasonable.com for more!Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

Tyler Cowen, professor of economics, blogger at marginalrevolution.com, columnist for Bloomberg, host of Conversations with Tyler and author of numerous books returns to the Not Unreasonable Podcast to talk about his latest book, Big Business: a Love Letter to An American Anti-Hero. All too rarely do you get a tour of how incredibly strong the evidence is that everyday truths are what they are: big business actually exists for a reason because it mostly does exactly what we need: provide goods and services at affordable prices with reasonably good service. What's more is that big business is the source of all kinds of benefits to America and to human society generally. It's even better than you think! In the show we cover:- where businesses fit into the social intuition of the human mind- similarities between how we treat famous people and big business and what another of Tyler's books, *What Price Fame* can teach us about big business- What is good management and what effects does management have on employees?- How the book is an American book and how it is NOT a Chinese book- Crony capitalism doesn't exist here, but where might it exist in the world?- Wall Street and Financial Dark Matter- How Tyler views the firmAll this and much more! See show notes at notunreasoanble.comTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

This episode is about how to build an organization that itself builds great products, especially great software products. I am absolutely not exaggerating when I say that this is the most important and under appreciated topic in the world today. It will some day be impossible for a company to thrive without these skills and we as a society are still figuring out how to organize human enterprises into productive software-making machines. It does NOT come naturally and I believe Marc Andreessen when he says that software will eat the world. That means that if your organization doesn't learn how to produce great software it, too, will be eaten and you along with it. Melissa Perri lives at the cutting edge of software process design and runs a consultancy devoted to building great product leaders. This of course applies to non-software products but the day is approaching when there is no such thing as a non-software product. Listen to this episode and continue on your journey to being a better producer of software, either as a coder or as an enabler of the programmers that build the products your company sells!Thanks for listening! Show notes at notunreasonable.comTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guest for this episode is Alex Tabarrok, the Bartley J. Madden Chair in Economics at the Mercatus Center and Professor of Economics at George Mason University, blogger at Marginalrevolution.com, co-founder of Marginal Revolution University and co-author with Eric Helland of "Why Are The Prices So Damn High?" which is short, free book and which we discuss on the show.Alex has written many other books and papers and there is a theme of thinking about innovation throughout his work. Several years ago he wrote a book on the topic called "Launching the Innovation Renaissance" which we also touch on as well as how the era of a country's birth affects its institutional makeup, how national rivalries can generate positive externalities (pop quiz: what was NASA's budget as a % of US GDP at its peak?), whether and why there has been a decline in innovation (and what's the difference between innovation, entrepreneurship and economic growth?), where we might look for a model of education reform and how we might get there (what would a hollywood-style investment in education reform look like?) including Alex's own observations in launching his own education platform (marginal revolution university!), and much more!Show Notes:https://notunreasonable.com/2022/01/07/alex-tabarrok-on-innovation-and-the-baumol-effect/Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guest for this episode is Matt Moore, SVP of the Highway Loss Data Institute. At HLDI Matt manages the research function for HLDI's massive insurance and automobile dataset. In this episode we leap to the cutting edge of AI in automobiles and learn about how well some key safety features perform, such as:Front Automatic Emergency BrakesCurve-adaptive headlights (Big surprise!)Lane departure warning systemsBlind spot warning systemsParking sensorsRear camerasRear automatic emergency brakeIn addition to rattling through those features and how effective they are we touch on all sorts of related topics: what the different levels of AI are, how safe the roads can get, the mix of hardware and software in modern vehicle safety systems and much, much more!See show notes and more more at notunreasonable.com/podcastTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guest for this episode is Dinos Iordanou, former Chairman and CEO of Arch, which he co-founded as Arch in 2001 and led from 2003 until retiring last year. In this incredible episode we cover: Dinos' homeland of Cyprus (who is his favorite Cypriot? Who is the best Cypriot soccer player of all time? Where did a poor, young Dinos vacation and why?)'Crappy' jobs (and why Dinos loved them all), What quality Hank Greenberg and Warren Buffett share (Dinos worked with both!)What lessons Dinos learned from Warren BuffetThe power of culture to transform firmsPhilotimo, what it is and why it matters for a leaderAn amazing show and my deep appreciation of Dinos for his time. See notunreasonable.com for more!Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guests for this episode are Don Mango Global Head of Actuarial Pricing and Modeling at Everest Insurance, Two-term Casualty Actuarial Society Board Member and former CAS Vice President of Research and Development and Matt Mosher, EVP and Chief Operating Officer of A.M. Best Rating Services, responsible for rating operations globally.For these heavyweight guests we tackle a heavyweight issue: are actuaries innovating enough? How would we innovate more?We discuss:whether innovation is greater in pricing or reserving, whether risk classification is the seat of all innovation, how AM Best sees its role in innovation, the impact of driverless cars on insurance innovation (the answer might surprise you!), what happened in the UK? how should the formal Standards of Practice influence the identity of actuaries and innovation in the field. And much more!See episode details and links at notunreasonable.com/podcastTwitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays

My guest for this episode is Mike Sapnar, CEO of Trans Re, a 4.5 bn premium reinsurer based in New York City. For many in my business Mike needs no introduction: we cover what the differences are between insurance and reinsurance, what makes for good negotiators and what Mike learned going through an agonizing year or so while his company was in the spotlight, subject to friendly and hostile takeovers alike a few years back. I've never been anywhere near the pilot's seat during an all-or-nothing M&A roller coaster and Mike takes us through what he learned in those harrowing few months. David Wright:       00:58:09       Tell me something you learned.Mike Sapnar:        00:58:10       So, um, first of all, I learned there are no mergers of equals. It doesn't exist in Wall Street parlance. There's always a buyer and a seller.David Wright:       00:58:19       Yup.Mike Sapnar:        00:58:20       And even though we were a bigger company, we were getting a premium. We were doing a book for book swap, but we were getting a well let's come back to that. We were getting, it was a book for a book deal. We were going to have seven of the nine top positions, um, reinsurance was going to be a dominant part of the portfolio. And we felt we weren't the seller at the end of the day. Cause we were, we were the bigger company.David Wright:       00:58:56       This is the Allied World transaction.Mike Sapnar:        00:58:57       Yes. Yep. We were a bigger company. The issue was is we were getting a bigger premium in the book for book value based on the market price. And so Wall Street kind of said, well Transatlantic is the seller, they're getting the bigger premium. Is that a big enough premium? Is there something else out there? Hmm.David Wright:       00:59:12       What does it matter?Mike Sapnar:        00:59:14       Why does that matter if you're the, if you're the seller?Listen for more! If you enjoy the show, see more of my stuff at notunreasonable.com!Twitter: @davecwrightSurprise, It's Insurance mailing listLinkedin Social Science of Insurance Essays