Industry Growth and Enforcement: CT’s Twin Insurance Strategies

The Connecticut insurance sector plays a vital role in the global insurance landscape and the state's economy, according to a report from the Connecticut Insurance and Financial Services (IFS) Cluster and PwC US.  The report, released at the recent  2012 Insurance Market Forecast event in Hartford, highlighted the industry’s importance to the state, which was echoed in comments by the state Insurance Commissioner and Gov. Malloy. Commissioner Thomas Leonardi pointed out that “we regulate the 2^nd largest insurance industry in America,” noting that “if Connecticut were a stand-alone country, we would be one of the 10 largest insurance producing jurisdictions in the world.” You can’t ignore this industry without putting the state in great peril.”  Malloy said, stressing the need to both regulate the industry and view them as “partners” in job creation and economic development.

The 2012 Connecticut Insurance Market Report highlights the sector's rich history, current challenges and opportunities with analysis and findings from Connecticut IFS Cluster, PwC, and the Connecticut Economic Resource Center (CERC).

KEY STATS

According to the report, Connecticut ranks first nationally in insurance employment as a percentage of total state employment and the industry represents approximately 3 percent of the state's workforce, 6 percent of the state's payroll and 9 percent of the gross state product.  Full-time employment in the sector is said to be 50,242.

Insurance also impacts other sectors of the state's economy.  The report says that one new job in the insurance industry adds an additional 1.46 jobs to the Connecticut economy; an increase of $1 in insurance labor income puts an additional $0.78 into state commerce; and every year the insurance industry purchases an average of $2 billion in goods and services from other industries in Connecticut.

"The inaugural Insurance Market Forecast is the showcase effort of that collaboration and will serve as a valuable guidepost as we expand our efforts to attract businesses and talent to our state," said James Bedard, IFS Chairman and Chief Financial Officer/Chief Operating Officer for UnitedHealthcare's Northeast Region.  [CT-N video of event.]

Looking forward, the report emphasizes that competing globally, investing in education, retaining and developing human capital, and government-led economic development initiatives are essential to maintaining the state's leadership position in the industry and growing its economy.  To drive that future growth, the report identifies the five key megatrends – social, technological, environmental, economic and political – that will influence the world's insurance industry, explaining their implications, and offering ideas and actions for embracing them.

A year ago, Gov. Malloy’s office noted that there are more than 65,000 people who work in the insurance industry in Connecticut, described as being down by almost 25% over the past 20 years.  The report compares employment by state, highlighting the top nine:  California (179,936); Texas (163,690); New York (144,077); Florida (134,393); Illinois (112,408); Pennsylvania (110,484); Ohio (108,492); New Jersey (81,119); Connecticut (61,583).

CONSUMER INTEREST

The State Department of Insurance, even as it promotes development of the insurance industry, also goes to bat for consumers.  In the third quarter of 2012, the Department’s Consumer Affairs Unit (CAU) fielded more than 1,500 complaints and inquiries and helped policyholders recoup nearly $1.2 million. During that same period, the Market Conduct division levied more than $1.1 million in fines against carriers and returned that money to the state General Fund. The fines resulted from a variety of violations and settlements ranging from untimely claim payments to improper licensing.  Since January 1, the Department has recovered more than $6.3 million for policyholders and state taxpayers.

The majority of the funds recovered for policyholders stemmed from complaints over health, accident, homeowners and life and annuities policies. The Department calculates its consumer recoveries based on what the policyholder received as a result of the Department’s intervention. The inquiries and complaints also help the Department identify industry trends that may adversely affect consumers. This data also helps determine topics for consumer education and as tools to help the Department monitor the industry. The Market Conduct enforcement actions are posted on the Insurance Department’s web site at www.ct.gov/cid

Nonprofit Organizations Help Boost Voter Numbers, Study Finds

If one concurs with the adage that all politics is local, it should come as no surprise that the dust has barely settled on the state and national elections of 2012 as the focus shifts to the municipal–level elections of 2013. A Massachusetts-based organization devoted to increasing the role of nonprofit organizations in spurring voter interest and participation is already publicizing its “Voter Participation Starter Kit for Nonprofits and Social Service Agencies,” available for web download, coming off what it describes as the success of 2012.

The benchmark National Election Exit Poll showed that the lower income, younger, and diverse populations typically served by nonprofits accounted for a greater share of voter turnout than ever before. While some of this can be attributed to population increases, it was also aided by unprecedented voter education and engagement efforts from the nonprofit and civic sector, according to the organization reported.

“Nonprofits are among the nation’s most trusted messengers. An annual Harris poll consistently ranks nonprofits among the few sectors (small businesses are another) that respondents would like to have more rather than less influ­ence in government.”  That observation published in The Nonprofit Quarterly, from George Pillsbury, MPA, founder and executive direc­tor of Nonprofit VOTE, underscores the organization’s initiative.

He adds:  “Nonprofits of the 501(c)(3) variety are pre­sumed to have a limited capacity for promoting political participation because laws prohibit them from engaging in partisan politics to support or oppose a candidate for public office. Yet nonprof­its’ inherent civic engagement assets make them a potent force for political and electoral engage­ment, further strengthened by their nonpartisan approach.”

Organizations including the Connecticut Association of Nonprofits — a long-time partner of Nonprofit VOTE — have led this transition in recent years by bringing voter engagement into the sector mainstream. According to the organization’s newsletter, for the 2012 election they pointed a spotlight on the sector by sending educational materials on the needs of nonprofits to all state candidates.

“Elected officials pay attention to which communities and which populations turn out and are generally more responsive to organizations involved in registering voters and encouraging turnout,” emphasized Sophie Lehman, Communications Director for Nonprofit VOTE.

The National Election Exit Poll is the most relied on exit poll conducted by Edison Research on behalf of ABC News, Associated Press, CBS News, CNN, Fox News, and NBC News.

Good News, Bad News in First-time CT Public School Ratings

The State Department of Education, following federal education guidelines and under a newly developed state rating system, has identified 28 Turnaround Schools in the state, which include 7 in Bridgeport, 5 in Hartford, 5 in New Britain, 5 in New Haven, 2 in Windham, and 1 in New London, Stamford, Waterbury and Bloomfield. The Turnaround Schools receive support from the state Department of Education in their efforts to develop and implement plans that will lead to improved academic performance, and will maintain this classification for three years. In order to exit Turnaround status, a school must demonstrate sustained improvement, which means it must meet overall School Performance Indexes and graduation targets for three consecutive years.

Turnaround schools are the bottom rung of a new five-tier accountability system that places each Connecticut public school in categories ranging from "excelling," "progressing," and "transitioning," to "review/focus" and "turnaround."  Shortly, all public schools in the state will receive a numerical rating from 1 to 100.  The goal is to exceed “88” in the scoring.  While the schools in some categories have been announced, the scoring is yet to come.

Also identified are 97 schools described as “Schools of Distinction.”  This classification consists of three different groups, with schools possessing either the highest-achieving subgroups, have the best overall student performance or have made the most progress from one year to the next.

Towns with the largest number of “schools of distinction” include Greenwich, Madison, New Britain and Newtown, Bridgeport, Hartford, New Milford, Stamford, Farmington, Guilford, Madison, Simsbury, and Trumbull.

Most schools are at various points in the middle, including 139 schools labeled as either "focus" or "review" schools. These rankings are given because of low performance among certain student populations such as special education, students from low-income families, and black or Hispanic students.  That list is still to come.

The performance measures and school ratings will be available for public review on a new web page on the state Department of Education website, www.sde.ct.gov, anticipated later this week.  (Keep checking the website?)    Overall, approximately 1,200 schools are to be  included in the ratings system, with a total student population approaching 50,000.

Adding Women to Corporate Boards Makes Financial Errors Less Likely

Two years ago, Calvert Asset Management Company, Inc. and the Connecticut Retirement Plans and Trust Funds (CRPTF) announced the successful resolution of their joint shareholder proposal on board diversity filed with Netflix, the world's largest subscription entertainment service. The announcement came as the company named its first female director, Ann Mathers, an entertainment industry veteran who joined the Netflix Board on July 1 of that year.  On behalf of the CRPTF, Connecticut Treasurer Denise L. Nappier has spearheaded Connecticut's initiative to increase the participation of women and minorities as members of Boards of Directors of corporations in which the $24 billion pension fund invests.

New data developed by a team of researchers at the University of Wisconsin-Milwaukee suggests that Nappier got it right, at least in one critical aspect of business.  Companies whose directors include one or more women are 38% less likely to have to restate their financial-performance figures to correct errors than firms with all-male boards, says the team led by Lawrence J. Abbott of the University of Wisconsin-Milwaukee.

Gender diversity may make a board more open to viewpoints that oppose the CEO's and may encourage a more deliberative and collaborative decision-making process, according to the research, published in the American Accounting Association journal Accounting Horizons.

Treasurer Nappier has filed numerous shareholder resolutions on corporate board diversity, in accordance with the State of Connecticut's investment policy and the recognition that companies and firms that demonstrate a commitment to diversity are more likely to succeed in an increasingly global marketplace.

Restatements are necessitated by serious misrepresentations, whether through error or fraud, in corporate financial reports. A woman's presence on a board, the researchers found, does more on behalf of financial integrity than such tried-and-true measures as requiring the board's audit committee to consist entirely of independent directors, one of them with financial expertise, and mandating that it meet at least four times annually. The study finds those measures in combination to reduce the likelihood of restatements by about 20%, about half the effect achieved by having a woman director.

As the findings point out, “Gender diversity can potentially affect the outcome by generating more questioning of the status quo, greater acknowledgment and legitimization of opposition and third-party viewpoints (including those of the audit committee, auditor, or internal audit director) and a slower, more deliberative and collaborative decision-making process...heightening the monitoring effectiveness that may [otherwise] be diminished by groupthink."

The study's findings involved a comparison of companies that had to issue financial restatements with a control group of similar firms with no such reporting problem. The restatement sample consisted of 540 firms in total, with each of the restating firms matched with a control company on the basis of market capitalization, industry, and the ranking of the firm that performed its auditing.

Nappier, inducted into the Connecticut Women’s Hall of Fame in 2011, has served as State Treasurer since 1999, having previously served as Treasurer of the City of Hartford.  She is the first African-American woman to serve as a State Treasurer in the nation’s history.

Tale of Two Lists: Influential Leaders in Greater Hartford

‘Tis the season of making a list and checking it twice. Which will probably be the strategy employed by Hartford magazine next year, after enduring considerable criticism for omitting Latinos from their list and feature article on the “50 Most Influential” individuals in the Greater Hartford region - a prominent, lengthy and well-photographed December edition cover story.

Now, Latinos United for Professional Advancement (LUPA) has issued its list of the 50 most Influential Latinos in the region – a list not only impressive for who’s included, but for the numerous talented and highly placed Latinos who didn’t make the list, an indication of the growing breadth of leadership in the region by individuals of Hispanic heritage.  It is the first such list to be issued by the relatively new organization, aimed at bringing together and advancing the Latino professional community.

At least Hartford magazine will have a place to start when they consider candidates for next year’s cover story.

Yes, such lists are incredibly subjective.  But as LUPA points out, their list “was developed to demonstrate the significant roles Latinos play in the capital region and the influence they have on many facets” of life in the region and the state.  “The Latino population in Hartford is more than 45 percent, according to the U.S. Census Bureau, and in Connecticut the total population growth from 2000-2010 was 168,532 with Latinos comprising 158,764 of that population growth.”

See the LUPA list and the Hartford magazine list.  All good and worthy people, who are making significant contributions to the region.   That's 100 names, no overlap.

Concerns raised by ctlatinonews and others regarding the Hartford magazine list will, one would expect, result next year in other names “making their first appearance, new faces on the Greater Hartford scene that we expect to see more of in years to come,” to quote, in a slightly different context, the Hartford magazine list preamble.

Virtual Technology Drives New Collaboration to Respond to Achievement Gap Challenges

A persistent academic achievement gap, determination to advance an effective response and the emergence of a cutting-edge technology are driving a new collaboration that is aiming to improve education opportunities for students in underserved communities and strengthen connections among students, teachers, parents, and the community. The first steps of the initiative – which brings a leadership donation by the Travelers Foundation together with the just-formed Connecticut Technology and Education Collaborative (CTEC) and the Hartford Public Library – will lay the groundwork for the introduction of “desktop virtualization” technology to support education for Hartford students.

The Travelers Foundation is providing no-longer-needed computers and financial support to CTEC, which includes The Walker Group, Connecticut Center for Advanced Technology (CCAT), GreenShare Technology and SpaceFitters. The CTEC initiative marks the first time that such an effort has been undertaken in Connecticut - designed specifically to bring an evolving cutting-edge technology to K-12 students in the state.  A pilot project launched by CTEC began earlier this year in Windham schools.

The donation by the Travelers Foundation will support repurposing and installing the computers at a number of Hartford Public Library locations. In turn, they will be designated for student use and connected to the Hartford Public School network. This will give HPS students after school access to the applications and files they’ve used during the school day from reconfigured PC’s that operate better than new ones.  Access to their classwork offers the students the means to spend additional time reviewing material, working on assignments, and reinforcing lessons.

The technology enabling these donated computers to perform so well is known as desktop virtualization, which shifts the more intensive processing from the computer itself to a specialized server running in a secure data center in East Hartford, part of a previously established and underutilized state network that was developed to advance educational purposes.

The desktop virtualization technology enables students and faculty to access their school network from anywhere, anytime, using any type of device. It is a transformational technology in education, giving students a new way to access technology and opening up extended learning options for disadvantaged schools and communities.

“Virtual desktops hold tremendous potential for enabling under-served students to gain access to school technology," commented Tony Budrecki, Virtualization Services Director at The Walker Group in Farmington. “Our repurposing of legacy machines donated by Travelers into high performance systems wouldn’t have been possible just a few years ago. It’s a great example of creative philanthropy helping to solve a big societal problem.”

The Connecticut Technology and Education Collaborative is made up of Connecticut-based for-profit and non-profit organizations. The group’s goal is to help level the playing field for access to high-quality, affordable technology in school and from home, through creative public-private collaboration.  The initiative also offers the potential of cost-saving benefits to local schools, as computer network capacity is used more efficiently.