By: Pierre Morrisseau, CEO, OneGroup
Upstate New York is heating up with myriad projects and market growth, bolstering confidence that 2025 will be a positive and productive year yet planning for typical and unknown new risks. Meanwhile, we are in the grip of another northeast winter that brings with it additional potential claims such as auto accidents, property damage and slip-and-fall to name a few.
Our clients are telling us they are entering the new year with renewed optimism while continuing to struggle with the larger issues of employee acquisition, engagement, and retention, reading the regulatory landscape in a rapidly changing business environment, and grappling with the continued high cost of insuring against risks.
On the employee front, we are also focused heavily on strategies for attracting the best and brightest while retaining our long-term employees who possess deep product and institutional knowledge. The balancing act is far from easy, as the workplace dynamic has dramatically changed since the pandemic. For example, Korn Ferry research revealed that managers are being asked to do more because Gen-Z employees—future leaders—do not want to assume roles in management. Adding to the challenge, the research found that 45% of employees over 55 have not spoken to a Gen-Z at work over one year, and only one in five Gen-Z employees have engaged with employees over 50. Of course, there are generations up and down the scale, but this example points to the challenges we, as leaders, face when trying to build a high-productivity, cohesive workforce.
This bifurcation in the workplace contributes to erosion of communication and transparency, all of which can create a lack of trust—the enemy of collaboration and esprit de corps. While we have a robust human resource consulting division to assist us in employee engagement, it remains a top-level priority for us as it does for many of our clients and leaders I have spoken with.
On the risk management front, the cost of insurance remains high and companies are looking for ways to reduce costs while retaining adequate coverage to protect their assets.
I recently shared that insurance rates continue to climb as the cost of repairs, replacement, and litigation soars. I also shared that there are strategies that you and your insurance broker can employ to reduce your cost through risk analysis and mitigation.
One timely example of recognizing and mitigating the cost of risk is water damage and freezing. According to the Insurance Information Institute (III), together, these risks represent the second-most cause of property claims annually, followed by wind and hail. From 2018 to 2022, about 25% of home insurance claims were due to water damage or freezing, with an average repair cost of over $14,000. Just one inch of water in a typical home can cause $25,000 or more in damage, and the number is increasing yearly according to III. Despite this large risk, Consumer Affairs indicates that fewer than 20% of homeowners take precautionary steps to protect their assets, including purchasing the correct insurance coverage.
This illustrates the importance of not only creating an annual plan to check hoses, pipes, and faucets regularly, but to list mitigating steps such as monitoring your water bill, clean gutters, protect pipes from freezing and inspect/replace your water heater to name a few. Additionally, new technologies make it easy to prevent water leaks and the high cost of repairs. For instance, several insurance companies offer customers free sensors and 24/7 monitoring and support or discounted premiums when installing leak detection sensors. These new programs are helping clients to avoid hundreds of thousands of dollars in losses.
Smart system water flow detection devices are affordable and are most effective when you combine several components including: leak detectors, water monitors, water shut-off valves and freeze sensors.
This is a simple example yet points to the importance and rewards of meeting with your insurance professional to create a mitigation plan and researching all the potential savings. It’s the smartest step for both homeowners and business owners/managers.