Welcome to December! Every child and insurance person knows what that means–presents!

And what better present than the future! So away with that gloom and doom of present difficulties and past disasters. Don't dot another binder, Bob Cratchit! Set aside that certificate of insurance, Tiny Tim! Let us settle down in our kerchiefs and caps around a Christmas Bowl for a moment of peace on earth and goodwill toward insurance folks and clients alike–and maybe even Eliot Spitzer.
Herewith are my annual gifts of wondrous insurance possibilities:
Off-planet power interruption endorsement. In the past, a mere off-premises endorsement was sufficient for the potential interruption of vital electronic services. But it's time to think outside the gift box, fellow cyberspace denizens, and reach for the stars–at least our favorite one. Solar power, “going green,” organic foodstuffs–all our latest and greatest life agendas are gone with the wind without an uninterrupted supply of energy from up above. As technology improves and utilization spreads, our dependence on Old Sol grows ever more critical, rendering power-interruption forms increasingly inadequate. Where's the form that includes “heavy overcast” as a covered peril? What endorsement addresses sunspots, solar flares or black holes? Naturally darkness would be excluded, unless due to an otherwise covered peril.
Identity-bereft coverage. Certainly identity theft coverage is the hot topic of the year. Everywhere we turn we confront the dire possibility of somebody making off with our most private information, thereby possessing the keys to our very souls. This, of course, assumes there's something private to steal. Voila! Enter the MySpace and Facebook generation. If scarcity of information creates value for thieves, the solution is obvious: Flood the market! Making everything private about us public renders such information worthless. The real risk of loss in the future won't arise from the theft of private details; it'll come from losing potential income because of to total transparency.
Think about it. Job offers may almost disappear, since many applicants will be unable to conceal their stunning lack of qualifications. (The decline in the number of football coaching and House and Senate candidates alone staggers the imagination.) Marriage may become extinct when prospective mates can easily discover the number of children desired, monetary habits, the way you look in the morning and all your various and sundry perversions. Software companies currently earning billions by building firewalls and deleting cookies will find their revenues crushed when we throw the vaults open to anyone chancing to wander by. An entire segment of our digital economy will face ruin. But those savvy enough to add identity-bereft coverage to the personal and business risk management portfolios of valued clients will reap a windfall!
BMPDAP–business mobile personal digital assistant policy (“bumpdap”). CGL aficionados everywhere can recite from memory the key clause in the policy definition of mobile equipment: “Vehicles, whether self-propelled or not, maintained primarily to provide mobility to permanently mounted:
“1) Power cranes, shovels, loaders, diggers or drills; or
“2) Road construction or resurfacing equipment such as graders, scrapers or rollers.”
That's so yesterday. Seriously, how many power cranes, shovels, loaders, diggers and drills might there be out there on our nation's highways? Thousands? Tens of thousands? A drop in the bucket. Now, try some real numbers on for size: 1.5 and 160. Sound tiny? Oh, forgot to add million. To be precise, those are the current numbers of iPhones and cell phones sold in this country–this year! We're talking serious digital-device inundation.
Now for the future kicker: The clear trend, via plug-in, FM transmitter, Bluetooth or Vulcan mind-meld, is to attach each of these devices to an automobile. (How many more accidents this will help cause is another column for another time.) For an increasing number of consumers, these are no longer toys but necessities of life. Automakers are now building these devices directly into new models.
It won't be long before the digital integration of car and device reaches a point where some “vehicles, whether self-propelled or not,” will be maintained primarily to provide mobility to permanently mounted iPods, iPhones, cell phones, DVD players and Sirius radios. And those vehicles, dear friends, will join mobile equipment in that twilight zone between pure equipment and motor vehicle coverage. And certainly an exposure of this magnitude deserves not a mere endorsement, but a full-blown coverage form. Ladies and gentlemen, I give you the BMPDAP! Now just pray our insurance carriers get with the program before Steve Jobs rolls over us with the “iPolicy.”
Scheduled life floater. Is there anyone who hasn't noticed that life is moving faster these days? It doesn't take Nostradamus to realize that, in the future, key life goals and events are going to fall by the wayside as we blaze through the years like comic hero The Flash. So add to your risk management file a new potential insurable peril: loss of scheduled life events due to dreaded AMDD (Accelerated Multitasking Disruption Disorder).
Underwriting is simple. The prospect simply lists each future life event he or she wishes to schedule: marriage, children, retirement, personal relationships with others and similar milestones (like par at Pebble Beach) without which the applicant would feel the value of life severely diminished. Since the economic value of each event may be fluid, the coverage would be written on a valued basis similar to life insurance. If any of the scheduled events fail to take place due to AMDD, the policy pays the agreed value. Exclusions would naturally include nerditis, the simple failure to have a life; martyritis, where the added misery of losing key life events actually makes the insured happier; and, of course, narcissitis, which causes its unfortunate victims to define a life event as buying a second Mercedes SUV or a $7,500 Rolex.
Functional description replaced-cost coverage. For years, insurance folks have assumed that replacement-cost coverage was one of our true value-addeds. Banish the hated ACV. Away with your repairs or replacement with like property! New for old, that's the ticket!
How retro. The new wave is “better for old!” Who wants that piece of junk I bought last week when there's a whole new model out now? Since it probably costs less than the original, what is this insurance company's problem, anyway? As Captain Picard might say, “Make it so, No. 1.” Enter functional description replaced-cost coverage! The coverage will be the same as current property forms, with two changes:
First, each insured item will be described functionally, not specifically: cell phone, PDA, portable computing device, etc. For example, an insured will not schedule his iPod as “iPod,” but rather a “digital music storage/player device” with an insured value of the device's original cost new.
Second, the true genius of this policy lies in the totally revised valuation clause. It provides that the carrier will pay for any item the insured chooses to replace, as long as (1) the new item has a functional description similar to the damaged or destroyed item; and (2) the cost does not exceed the item's original cost. Now, when an insured buys that new laptop and discovers when it's stolen three weeks later that the model is not only already obsolete but not even available, he or she can replace it with a far more powerful laptop at a lower price. The carrier simply pays for any new laptop (or other similar device, such as a tablet PC) of the insured's choice, up to the policy limit, no problem! No hassles, no messy depreciation, no arguments over replacing a simple cell phone with the latest Wonder Phone with built-in camera, music, Web surfing and dishwasher. It's still functionally a phone, and the carrier can't complain since its maximum liability was known at the time of policy issuance. Hey, forget the future–we need this thing of beauty now!
I'm sure even now there are other great ideas percolating through your eggnog-infused brain cells. Send them along and they just may appear in a future article. But for now, draw your future musings to a close. I have held one vision of tomorrow in reserve for just this final moment in your presence: May you have the safest and most blessed Christmas ever!
Chris Amrhein is an insurance educator and speaker with more than 30 years in the industry. He is also chief fun officer of www.insuranceisfun.com, where his newest book of insurance musings, “Yes, Virginia, There Is Insurance,” is now available. Readers may contact Chris at [email protected].