Insurance Losses and Healthcare Payouts: An Interview With Kenneth White

Darshan: Hey, everyone. Welcome to another episode of DarshanTalks. We have our guest, Kenny White, Kenneth White. He is from Willis Towers Watson. However, I do want to make clear, he doesn't represent Willis Towers Watson right now. He's just talking. That just happens to be where he works. We had a really interesting conversation with him previously about his entry into being in house. Now we wanted to get a little bit more into details to talk about just how does insurance payouts right now with COVID going on, there've been a lot of discussions around the idea of, "Well, will my insurance pay my claims? I've got a ton of business losses that I need to offset or at least offload. Is that really possible in this world?" Then there's a whole discussion around payers. We'll see how far we get. But Kenny, do you want to do a quick introduction for yourself? Kenneth White: Sure. I'm Kenneth White. I'm the national managed care practice leader for Willis Towers Watson, which means I oversee the group of people who provide corporate risk and broking services to the managed care industry. I'm a healthcare lawyer. I practiced as a trial attorney for 28 years before I took this job six years ago. As Darshan said, I am not speaking on behalf of Willis Towers Watson. Darshan: Very cool. Let's ask the big question of the day. How are insurers dealing with the idea that, "You know what? I bought business insurance. I, in some cases, even have that it'll cover cases like SARS," which happened to be... I think SARS was a coronavirus. Are my COVID losses going to be covered? Again, we're not talking to Willis Towers Watson in this specific instance. We're talking about just generally, how is the insurance industry dealing with this? Kenneth White: Well, so Willis Towers Watson primarily is an insurance brokerage entity. We don't actually provide the insurance. We work with entities for... They will have the right insurance and the right amounts from the right companies. But people who run insurance companies traditionally are not dumb. So when communicable disease outbreaks happen and they are left holding large claims that they have to pay out for which their premiums were not actuarily determined to include that risk, they are now in what they refer to as an upside-down, or we could think about it you do your lease. I only got in $100, I've got to pay up $200. This was not a good deal for me. They will use language, terms, and conditions to exclude certain claims from coverage. So that when the mold and mildew claims came about a number of years ago, you saw significant numbers of exclusionary terms and conditions coming into property claims, especially GL claims, general liability, or umbrella policies to eliminate a claim being payable for mold and mildew. Same thing when the SARS, swine flu, bird flu, whatever we called it before. When that happened, you saw another crop of coverage terms coming out in insurance policies to limit the insurance carriers' exposure to that type of a claim. You see the same thing in cyber where your traditional professional liability or E&O, errors and omissions, coverage would provide you breach coverage. They have eliminated that almost entirely now as the network security and privacy, most of us call it cyber, insurance industry has become mature. You can still get the coverage, it's just not going to be under that policy. It will be under your cyber policy. With COVID, obviously the first things that people think about are either health claims or they think about property claims. My company had to get rid of everybody, clean our offices 19 times. We lost use of all of our facilities. We may have lost income as a result.