erkshire Hathaway, Inc.
Legal insights into an insurance investment strategy

Warren E. uffet's erkshire Hathaway's company strategy since the global economic crisis in 2008 has been characterized by what some would call 'safe-but-boring' industries. Consistently outperforming on the S&P, the Company has been effective where others have not. The foregoing project proposal looks at the decision making model(s) used by H in investment in the insurance industry, with a hypothesis that one Selective Insurance Group (SIG) will emerge as the target for acquisition. Attendant to this study of competition and crisis is the formative role that insurance law plays in investment and the impact of corporate counsel as a functionary aspect to the insurance business. Employing a Six Sigma assessment approach, corporate case studies and aggregate insurance industry data are put into dialogue with the history of client litigation by those firms.

TALE OF CONTENTS

Abstract

Introduction 4

Problem Statement 5

Literature Review 15

Methods 15

Data Analysis 16

Implications…...

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Bibliography

ACE, Ltd. (2010). Hoovers. Retrieved from: http://www.hoovers.com

Berkshire Hathaway, Inc. (2010). Retrieved from:  http://www.berkshirehathaway.com/ 

Berkshire Hathaway, Inc. (2010). Hoovers. Retrieved from: http://www.hoovers.com

Berkshire Hathaway, Inc. (2010). Standard and Poors.

While the insurance companies worked to satisfy claims there were so many of them that there were backlogs for months at a time. Clients were left to figure out how to survive without having insurance money in their hands and tempers began to flare on all sides of the crisis (Burr, 2006).

As additional natural disasters continued to loom over the sunshine state and wreak havoc, insurance companies won the right to begin raising their premiums to try and recover from the massive and unprecedented losses that they had suffered over the past decade (Fogg, 2006).

The legal decision to allow an increase in premiums pleased the insurance companies however it angered the policy holders in significant numbers.

The Sunshine State is suffering from a symbolic cloud cover of epic proportions. The ominous overcast outlook is a result of two major factors in the Florida insurance atmosphere -- public outrage that continues to…...

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References

Burr, Barry B (2006) Revenue-sharing suit filed; Florida plan calls payments to Nationwide 'kickbacks'.(Nationwide Life Insurance Co., Nationwide Financial Services Inc., Sheriff Kevin Beary) Pensions & Investments

Blacklidge, Ray (1995) Florida Hurricane woes require a private-public solution. (insurance)

From: National Underwriter Property & Casualty-Risk & Benefits Management | Date: July 17, 1995 | Author: | More results for: florida insurance management principles

Deep Impact: New Florida Homeowners Insurance Laws Are Influencing the Insurance and Reinsurance Market in Other States and Other Lines.(Reinsurance/Capital Markets: Expanded Florida Law) Best's Review

Geico
Current status

Value Chain

Marketing

Operations & Service

Five Forces

Buyers

New Entrants

Intensity of ivalry

Competitive Advantage

Data, service

Size

Stability, reach

Brand

Macroenvironment

Political

Social

Technological

Key assumptions

Build Brand

Invest in Technology

GEICO began life in 1936 as the Government Employees Insurance Company (GEICO) but is better-known by its acronym. The company has always focused on the auto insurance industry. Today, GEICO is a wholly-owned subsidiary of Berkshire Hathaway. The original business model was to focus on government employees, but soon the company opened up to a broader audience (GEICO, 2015).

Industry Value Chain

The value chain consists of five elements of a business from which a company can derive competitive advantage: inbound logistics, operations, outbound logistics, marketing & sales, and service (MindTools.com, 2015). Inbound and outbound logistics are not usually a major part of the service value chain, though in GEICO's case the company only sells over the Internet, which is a key point of differentiation and lowers operating cases (Aho, 2014). The key elements for GEICO are…...

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References

Aho, K. (2014). GEICO's silly ads are working. Bloomberg Business. Retrieved March 17, 2015 from  http://www.bloomberg.com/bw/articles/2014-07-24/geico-spent-935-million-on-advertising-in-2013-and-it-worked 

GEICO. (2015). GEICO at a glance. GEICO.com. Retrieved March 17, 2015 from  https://www.geico.com/about/corporate/at-a-glance/ 

Joseph, M., Stone, G. & Anderson, K. (2003). Insurance customers' assessments of service quality: A critical evaluation. Journal of Small Business and Enterprise Development Vol. 10 (1) 81-92.

MindTools.com (2015). Porter's value chain. MindTools.com. Retrieved March 17, 2015 from  http://www.mindtools.com/pages/article/newSTR_66.htm

Briefly describe your career field or a field of interest to you. Both the insurance and financial services industries play a very critical role within society. As it relates to insurance companies, they help to safeguard and mitigate loss relates to unexpected events. They also help to lessen the financial burden associated with the eventual recovery from the loss event. Earthquakes, Floods, Hurricanes, and other natural disasters are very difficult to predict on a year to year basis. Even more uncertain, is the severity of the damages associates with such an event. Many families in the United States live paycheck to paycheck and can not afford an unexpected $500 expense. Insurance is designed to lower the overall uncertainty that can result when an insured loss event occurs. Insurance covers the risk that individuals or corporations are unable and unwilling to cover themselves. As many of these risks can be very severe,…...

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References

1. Chorafas, Dimitris N. Financial Boom and Gloom: The Credit and Banking Crisis of 2007-2009 and Beyond. New York: Palgrave Macmillan, 2009.

2. Brown, B. & Kim, J. (2017). Understanding Millennials Mobile Shopping Behaviors: An Implication for Insurance Industry. The Journal of International management Studies, 12(1), 71-82.

3. Portenous, C. (2019, Oct. 8). Technology is Changing Insurance for the Better. Entrepreneur.  

4. StateCE (2017, Oct. 30). How Millennials are Changing the Insurance Industry.  https://www.statece.com/blog/insurance/how-millennials-are-changing-the-insurance-industry/ 

https://www.entrepreneur.com/article/340297 

Aflac, Inc. Case StudyThe purpose of this paper is to provide a review of a case study concerning the total rewards strategy at the American Family Life Assurance Company, Inc. (Aflac) and how it aligns with the companys guiding values and principles. To this end, a discussion concerning the companys internal strengths and weaknesses and the external opportunities and threats of the company as well as how it responded from a total rewards perspective. In addition, based on the corporate values of the company, salient revisions are proposed that would make its benefits program better aligned with the accomplishment of the company's organizational goals and values. Finally, the paper provides a summary of the main findings that emerged from the case study concerning the companys total reward strategy in the conclusion.Think about the internal strengths and weaknesses of the company. How, if at all, did the firm respond to these…...

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References

About Aflac. (2023). Aflac. Retrieved from  https://www.aflac.com/about-aflac/default.aspx .

Azfar, R. (2017). Aflac’s new campaign uses scare tactics to court millennials. MarketingDive. Retrieved from 24042.html.https://www.marketingdive.com/ex/mobilemarketer/cms/news/video/

McCann, D. (2019). For Aflac, Slow Growth Means Extra Cash Flow: And for CFO Fred Crawford, investing the excess cash means weighing opportunities against the baseline return afforded by stock buybacks. CFO, 35(3), 14–15.

Industry and egulatory Strategy
The generic drug industry provides the public with pharmaceutical alternatives to branded big name prescription drugs. "In 2010 alone, the use of FDA-approved generics saved $158 billion, an average of $3 billion every week."(Generic Pharmaceutical Association. 2011. P.1). With the continuing increase in health care expenditures and health insurance premiums for business and consumers; in 2011 premiums increased by nine percent (Abelson, eed. September 27, 2011. P.1), and "with so many people relying on prescriptions, the cost implications loom large for the American public, health insurers, and government payers" (Kaiser.edu.org. N.D.P.1). Generic drugs must play a more prominent role in the U.S. health care profile, as such as CEO of the Generic Pharmaceutical Association (GPA), the organizations legislative push is toward patent reform which would call for generic drug competition within seven years of the name brand drug introduction. In so doing pharmaceutical prices would fall dramatically…...

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References

Abelson, Reed. (September 27, 2011). Health Insurance Costs Rising Sharply This Year,

Study Shows. The New York Times. Retrieved December, 12, 2011 from  http://www.nytimes.com/2011/09/28/business/health-insurance-costs-rise-sharply-this-year-study-shows.html?pagewanted=all 

Bio Job Blog.com. (February 1, 2010). Why Generic Drug Companies Will Dominate

Future Pharmaceutical Markets. Bio Job Blog.com. Retrieved December 12, 2011 from http://www.biojobblog.com/2010/02/articles/biobusiness/why-generic-drug-companies-will-dominate-future-pharmaceutical-markets/

isk and Insurance Management
isk is believed to be a newly coined word of assurance (for example, Ewald, 1991: 198). One of the broadly shared suppositions regarding insurance is that it spins around an instrumental concept of risk. Possibility and the amount of influence make up a technical concept of hazard/risk and hazard administration is chiefly worried about reviewing these possibilities and influences (for an overview see Gratt, 1987). For instance, external profits of financial or political occurrences lay down thresholds for the availability of associated risk guesstimates or reckonings (Huber, 2002).

So, the range of the risk groups cannot be clarified by risk judgment single-handedly; peripheral circumstances that could be political, financial or inclusive of image, arts and manners, are also required to be taken into account. Therefore, if risks are not be present, per se, but are deliberately selected, we can go a step ahead and presume them to be…...

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References

Douglas, M. And Wildavsky, A. (1982) Risk and Culture. An Essay on the Selection of Technical and Environmental Dangers. Berkeley: University of California Press.

Evers, A. And Nowotny, H. (1987) Uber den Umgang mit Unsicherheit. Die Entdeckung der Gestaltbarkeit von Gesellschaft. Frankfurt / Main: Suhrkamp.

Ewald, F. (1991) 'Insurance and Risk' in Burchell, G., Gordon, C. And Miller, P. (eds.) The Foucault Effect: studies in governmentality . London: Harvester Wheatsheaf.

Gratt, L.B. (1987) 'Risk Analysis or Risk Assessment: a proposal for consistent definitions' in Covello, V. And Lave, L. (eds.) Uncertainty in Risk Assessment, Risk Management and Decision Making, Advances in Risk Analysis (4). New York: Plenum Press.

com). A certain amount of errors is to be expected, but there should not be so many that it demonstrates a certain level of skewedness about the model in its entirety. Thus, if the NHI model is the one which is selected, then it needs to be tested against a range of different scenarios. The following demonstrate some truly relevant what-ifs: what if the doctors only move half the projected volume; what if medicare slashes rates; what if competitors open a comparable program (dgapartners.com).
There are a range of factors which can change or adjust once a healthcare facility opens their doors for business. And as much as this facility is attempting to engage in a solid humanitarian effort, at the end of the day, it's still a business and people need to get paid. Thus, before engaging in further developmental activities, one needs to determine in what ways the model…...

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References

Brakatu Ofori-Adjei, a. (2007). Microfinance: An Alternative Means of Healthcare Financing for the Poor. Ghana Medical Journal, 193-194.

Burnstein, L., Harris, R., & Love, L. (2012, August 30). Top Four Legal Issues to Consider When Opening an Urgent Care Center. Retrieved from Mondaq.com:  http://www.mondaq.com/unitedstates/x/194082/Healthcare/Estate+planning+is+important+step 

Burnstein, M., Harris, R.L., & Love, L. (2012, August 20). Top Four Legal Issues to Consider When Opening an Urgent Care Center. Retrieved from Mondaq.com:

Interest GroupThe insurance industry is a major interest group in healthcare (Hyman, 2007). In the United States, the industry is represented by several trade associations, including the Blue Cross Blue Shield Association and America\\\'s Health Insurance Plans. The insurance industry lobbies for favorable laws and regulations, and it provides significant campaign contributions to lawmakers. The industry also funds research and public education campaigns.In recent years, the insurance industry has been a major opponent of healthcare reform initiatives. The industry argues that reform would increase costs and reduce competition. The insurance industry has also been criticized for its role in rising healthcare costs. Critics argue that the industrys profit motive leads to waste and inefficiency. They also assert that the industrys influence prevents Congress from enacting meaningful reforms. Overall, the insurance industry is a powerful interest group that exerts significant influence over healthcare in the United States.Because the insurance industry is…...

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ReferencesHyman, D. A. (2008). Health Insurance: Market Failure or Government Failure. Conn. Ins. LJ, 14, 307.

Project Management
Insurance companies enjoy large profit margins in the insurance industry. A reason for these margins would be the project management ability of firm employees to effectively management risk. Project management tools enable managers to effectively manage inherent risk with project implementation and management.

An example of a project management issue at an insurance firm is provided by Pula & Stone (2003), "The authors' research shows that customer relationship management (CM) projects can achieve higher rates of return by work on data quality. Existing and new data need to be integrated and shared, with updates synchronised among many different systems. These systems (including operational, analytical and customer contact applications and databases) were rarely designed to work together and the data they collect and use are not normally collected, structured or quality-assessed for the CM purposes for which they are eventually used." (Pula, Stone, 2003)

The block quote is to provide the understanding…...

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References

Chase-Jacobs-Aquifano: Operations Management for Competitive Advantage, 11th Edition. The McGraw Hill Companies, 2005

Lind, D., Marchal W., Wathen S. (2010). Statistical Techniques in Business & Economics. 14th Edition. McGraw-Hill Irwin

Pula, E.N., Stone, M., & Foss, B. (2003). Customer data management in practice: An insurance case study. Journal of Database Marketing & Customer Strategy Management, 10(4), 327. Retrieved fromhttp://search.proquest.com/docview/233337595?accountid=13044

Health Insurance Consumer Knowledge
Do most people know everything about their health insurance plans?

The two plans investigated for this assignment are Blue Cross Blue Shield and Humana, two of the most widely used and recognized health insurance companies in the United States.

Do you think that in general most people know everything about their health insurance plans?

The healthcare reform act of 2009 sought to make the healthcare system in the United States more navigable for Americans and to prevent health insurance companies from taking advantage of their customers. It seems, however, that the dense amount of legal and financial information embedding in the policies published by most companies is beyond the comprehension of most Americans (Gabel et al. 1987). Most people probably are aware of their emergency and primary care coverage but might not know about other less publicized and critical elements of insurance coverage plans which may offer valuable benefits, such…...

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Works Cited

Anthem. (2011)Anthem Connecticut Health Plans. Retrieved from:  http://www.anthem.com/health-insurance/plans-and-benefits/health-insurance-plan/CT 

J Gabel, C Jajich-Toth, K Williams, S Loughran and K. Haugh. (1987). "The commercial health insurance industry in transition" Health Affairs, 6, no.3:46-60

Humana. (2011). Individual Insurance Plans from Humana. Retrieved from:  http://www.humana.com/individual_insurance/insurance_products/humanaone_medical_plans.aspx 

United States Government. (2011). Healthcare.gov. Retrieved from: www.Healthcare.gov

Meanwhile, without any competition, such as n the form of a public healthcare insurance system, the private healthcare insurance industry also continually increases premium fees virtually at will (Kennedy, 2006; eid, 2009). Furthermore, by refusing policies to high-risk patients, private health insurers essentially "cherry pick" the lowest risk patients while leaving the most expensive medical services to be furnished at the public's expense by public funds available to provide healthcare for low-income individuals (Kennedy, 2006; eid, 2009). That is why, at the very least. The future of American healthcare insurance must include a public option (Kennedy, 2006).

The Issue of Government Healthcare Insurance Lobbying

The principal way that the private healthcare insurance industry maintains its control over American healthcare is through political lobbying of government representatives (Kennedy, 2006). In fact, there are approximately six healthcare industry lobbyists in Washington for every publicly elected representative. Throughout the 2009 negotiations in Washington over healthcare…...

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References

Kennedy, E. (2006). America: Back on Track. Viking: New York.

Reid, T. (2009). The Healing of America: A Global Quest for Better, Cheaper, and Fairer Health Care. New York: Penguin Group.

I'm sickened and saddened by what I've become, and I'm staggered by the speed at which I've fallen" (Grisham, 1996, p. 140). Much of the book is realistic, but any good work of fiction takes license in some areas, and this work does, as well. A lawyer getting so involved with a client that he kills an abusive husband would probably be disbarred just about anywhere in the country, and yet udy looks like a hero when the story is finished. That is certainly not realistic.
Grisham supports his thesis against insurance companies throughout the work, by portraying the company and its representatives as greedy, uncaring, and only out for one thing - profits. Grisham writes, "So this is how the uninsured die. In a society filled with wealthy doctors and gleaming hospitals and state-of-the-art medical gadgetry and the bulk of the world's Nobel winners, it seems outrageous to allow…...

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References

Grisham, J. (1996). The rainmaker. New York: Dell.

The other necessary element in this process is procedure cost vs. reimbursement evaluation and proactive search of strong reimbursement for future volume. Analysis of the first element is crucial because it helps in ensuring that reimbursement documented in existing contracts is being effectively recorded. The information obtained during this stage can be used at any time of renegotiations or contribute to the development of effective alternative approaches. The assessment of the second element helps to determine how insurance contracts compare and to ensure reimbursement expectations are established within competitive market ranges. The third element can be used for defense in validating the need for higher reimbursement than the current offer.
Second Students' esponse:

As the use of managed care plans have increased in the past few years, there is an increased need for appropriate insurance contracting strategy. The existing managed care plans are primarily based on demand management through co-payments. While…...

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References:

Devers, K.J., Brewster, L.R. & Casalino, L.P. (2003, February). Changes in Hospital

Competitive Strategy: A New Medical Arms Race? Health Services Research, 38(1), 447-469. Retrieved from  http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1360894/pdf/hesr_124.pdf 

Jones, C.L. & Mills, T.L. (2006, November-December). Negotiating a Contract with a Health

Plan, Family Practice Management, 13(10), 49-55. Retrieved from  http://www.aafp.org/fpm/2006/1100/p49.html

Insurance Agent for State Farm Insurance
Success as an independent insurance agent does not come easy. In this industry, success has largely got to do with hard work and an exceptional ability to handle occasional rejections. However, the benefits for those who succeed in this case are immense.

In my opinion, I would say that my success as an effective independent insurance agent for State Farm Insurance has largely been founded on not only my personal character but also my past achievements and business related experience. To begin with, I have always been a hard worker. I believe in the power of effort especially when it comes to getting things accomplished. Further, I would say I am rather talkative. I also regard myself an effective communicator. Effective communication skills are important in the insurance business largely due to the need to keep in constant contact with the public. In addition to…...

Mortality Rates
Mortality rates play a pivotal role in life insurance growth as they directly impact the underlying risk pool and pricing of insurance policies. Lower mortality rates indicate a healthier population and longer life expectancies, which translates into lower premiums for life insurance policies. This, in turn, makes life insurance more affordable and attractive to a broader segment of the population, leading to increased policy purchases and growth in the insurance sector.
Claims Settlement Efficiency
Claims settlement efficiency measures the speed and effectiveness with which insurance companies process and settle claims. Timely and hassle-free claim settlements enhance customer satisfaction and build trust....