Employee Handbook actuarial department Employee Handbook



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american family insurance

Actuarial Department



Employee Handbook

actuarial department

Employee Handbook

American Family Insurance

6000 American Parkway

Phone 608.249.2111


Table of Contents

Letter of Transmittal i

Figures and Tables iii



Section 1

Purpose 1

Our Mission 2

Our Vision 2

History 3

Where Are We Today? 4

Who Do We Serve? 5

Financial Outlook 6



section 2

Corporate Benefits 7

Health Insurance 8

Dental Insurance 8

Life Insurance 8

Paid Days Off

Vacation Days 9

Sick Time 9

Personal Days 9

Paid Holidays 9

Retirement Funding 10

Flex Time 10

Flex Spending 10

Dress Code 11section 3

Actuarial Analysts’ Benefits 12

Paid Study Time

Classes 13

Conferences and Seminars 13

Workshops 13

Your Time to Study 13

Bonuses

Monetary Bonuses 14



Salary Increases 14

Promotions 14

Casual Environment 14

Daily Duties 15



Section 4

Your Investment 16

Dedication 17

Progress 17

Certification 17

Personal Investment 18



Section 5

American Family’s Investment in You 19

Our Goal

Paid Study Time 20

Library 20

Study Groups 20



Section 6

Conclusion 21

Job or Career? 22
REFERENCES 23


Figures and Tables

Figure 1 Map of American Family States 5

Table 1 Consolidated 2001 GAAP Report 6




Section


1

Purpose of this Handbook



The purpose of this guide is to welcome and orient new American Family Insurance employees in the Actuarial Department.


W


E would first like to welcome you to American Family Insurance. We will begin with a brief overview of the history of American Family Insurance as well as discussion of our corporate goals. This handbook will also offer you an explanation of both the general benefits offered by American Family Insurance to each of the full-time employees, as well as the specific benefits that are offered to our Actuarial Analysts. Once the manual has been reviewed, you will also have an understanding of American Family’s investment in you as well as what investment is expected to be made by you in American Family.

American Family Insurance



Our Mission Statement

“To provide financial protection to an expanding customer base with a commitment to best value.”


Our Vision

“To be a Strong, Growing, and Friendly Company”


History
In 1927 Mr. Herman Wittwer founded Farmers Mutual Automobile Insurance Company in the state of Wisconsin to offer special rates to drivers of farm vehicles. Eventually, the company created National Mutual in an effort to offer discounted rates to drivers in other states, and finally became American Family Insurance, as we know it today, offering many lines of insurance.

Following is a timeline depicting American Family’s success.

1927 – Farmer’s Mutual Automobile Insurance Company is founded on October 3rd in Madison, WI

1930 – National Mutual Automobile Insurance Company is established to sell to non-farmers

1938 – Both premiums and assets surpass $1 million

1950 – Annual premiums exceed $10 million

1958 – Company introduces homeowners insurance and creates American Family Life Insurance Company, which logs $1 million in sales

1961 – American Standard Insurance Company (ASIC) begins sales September 30th. Farmers Mutual unveils major medical insurance

1962 – Life insurance sales reach $100 million

1963 – March 5th policyholders give final approval to change the Company’s name to American Family Mutual Insurance Company

1980 – American Family breaks into the nation’s top 20 auto insurers

1996 – American Family first appears on the Fortune 500 list at number 403. The Company has remained on the list ever since.

2002 – American Family celebrates its 75th anniversary


Where Are We Today?


The National Headquarters (which also serves as the Corporate Headquarters) are located in Madison, WI. In 1992 we moved into the campus that now houses 3,200 employees. This building services both the American Family Insurance Group and each of its member companies (American Standard Insurance Company and American Family Financial Services to name a couple).

We also have five regional offices to serve the agents and customers in the states we provide insurance.



  • Great Lakes Regional Office
    Madison, Wisconsin
    Serving Wisconsin and Illinois

  • Midland Regional Office
    St. Joseph, Missouri
    Serving Missouri, Kansas, and Nebraska

  • Northwest Regional Office
    Eden Prairie, Minnesota
    Serving Minnesota, Iowa, North Dakota, and South Dakota

  • Valley Regional Office
    Columbus, Ohio
    Serving Indiana and Ohio

  • Mountain Regional Office
    Denver, Colorado
    Serving Colorado, Arizona, Nevada, Utah, Idaho, and Oregon



Who Do We Serve?


Figure 1: Map of the states that American Family writes insurance

We currently write business in seventeen states as pictured above. We do have plans to continue expanding into various other states.


Our Financial Outlook


We are a company with over $10 billion in assets and employ more than 7,500 people, 3,800 agents. We are proud of our workforce and use it to efficiently provide for our insureds in times of needs. Following a storm, catastrophe or any accident, our policyholders need responses in a timely manner. They also need to know that we are indeed working for them and they will have responses and solutions as soon as they are available to us. Following is a small chart that shows our financial position for the past three years. These are just a few of the consolidated highlights from our GAAP financial report. You will notice the steady growth and solid foundation.

Category

2001

2000

1999

Assets

$10,274,603

$9,970,036

$9,568,615

Equity

$3,297,956

$3,469,467

$3,401,592

Revenue

$4,713,986

$4,388,432

$4,126,846

Policies in Force

7,450,277

7,450,277

7,172,173

Life Ins. in Force

$56.9 billion

$53.1 billion

$48.9 billion

Field Force

3,942

4,172

4,297

Employees

7,431

7,300

7,247

Table 1: Consolidated information from 2001 GAAP financial report

Section



2


Corporate Benefits

As a full-time employee of American Family Insurance, you are eligible for health insurance, life insurance, dental insurance, as well as paid days off for vacation, sick time, personal days and holidays. You are also offered a retirement plan, flex spending and a friendly, business casual environment.

Health Insurance

American Family Insurance offers its full-time employees health insurance for twenty percent of the normal monthly premiums for either individual or family policies. The Company will pay for eighty percent of the monthly premiums. Your cost will come out of each paycheck before taxes and will vary with the plan that suits you best. For detailed information on cost, contact AskHR.

There are five different health insurance plans that each employee may choose from:


  • UW-Health

  • Physician’s Plus

  • Dean Care

  • Unity Health

  • Pay-For-Service Plan


Dental Insurance
As a full-time employee you will be eligible for Delta Dental insurance. There are two different levels of this insurance which cover various things and have different costs to the employee. For further details on how this can be purchased and the rates, contact AskHR.


Life Insurance


American Family also provides life insurance for the full-time employees. This limit can be increased to a maximum of twice your annual salary. Again, the premiums will be taken out of your paycheck before taxes.


Paid Days Off


With American Family Insurance, there are four different types of days off that you will be eligible for, and accumulate while working.

Vacation Days

Once you have accepted a position with American Family and have started working, you are given ten vacation days per year. For the first three years, you will be given ten days per year. After the third year, the days will be increased to fifteen. You will be able to carry over any unused days at the end of the year with no limitations. Our year for vacation days runs from April 1st through March 30th.



Sick Time

Sick time is accumulated per pay period or the hours worked in the year. You will be able to earn up to ten days per year. Unlike vacation days, any sick time that is accumulated, and not used may be carried over to the following year. There is no limit in the amount of hours that may be accumulated or carried over.



Personal Days

Each full-time employee is given two personal days per year. These days must be used by the end of the year, for if they are not used, they will be lost because no personal time may be carried over from year to year.



Paid Holidays

Each full-time employee is given nine paid holidays per year. They include: New Year’s Day, Good Friday, Memorial Day, Fourth of July, Labor Day, Thanksgiving and the following Friday, Christmas Eve and Christmas Day (a total of two days surrounding Christmas depending on what day Christmas falls).


Retirement Funding
As a full-time employee of American Family Insurance, you are eligible for participating in our 401(k) program. We do offer several different levels of participation and risks ranging from low or moderate to high risk. Because this program is individualized based on what you may have to carry over or how you may want to begin, contact AskHR for further details.


Flex Time


As you will quickly learn, American Family truly cares about its employees. One of the ways this is demonstrated is through the various work schedules that are offered to the full-time staff. Each employee is given three workweeks to choose from to suit their personal needs as best possible. The options are as follows:

  • Five days of seven hours and forty minutes

  • Four 8 ½ hour days and one 4 hour day

  • Nine 8 ½ hour days, one day off. This day off can be whichever day of the ten day pay period you choose, however it must always be the same day from pay-period to pay-period. (e.g. You may choose to take off every other Tuesday or every other Friday.)

This schedule may be changed whenever you desire. You will just need to let your manager know that you are changing. Again, you will find that we are very flexible in trying to meet your needs. The hours that you work may also vary depending on what works with your personal needs. If you want to begin working at 7:00am or 9:00am that is up to you again, just let your manager know when to expect you.


Flex Spending


American Family Insurance offers Flex Spending to our full-time employees. This is an account that the employee may choose to establish that sets aside a certain amount of money per pay period. This money is taken out before taxes and may later be used for things such as medical expenses (office visit costs not covered, deductibles, prescriptions, eye glasses, contacts, etc.) or even daycare.


Dress Code


One of the first things that you will notice here, at American Family Insurance’s National Headquarters (NHQ), is that we do have a business casual work environment. This is not to say that we don’t intend to always exude professional confidence.

The following are not items that are permitted:



  • Blue jeans

  • Tennis shoes

  • Overly worn clothing

  • Sweatshirts with any slogans other than American Family Insurance

  • Items with any advertising or endorsements

This is a general outline of the dress code, and you will soon see that we do not require that people dress in suits or the like. We are a friendly company, and we want to portray that through everything we do here at NHQ.

Section


3

Actuarial Analysts’ Benefits



As an Actuarial Analyst, you are given benefits in addition to those explained in the previous section “Corporate Benefits”. You will find that you are given study time, bonuses, salary increases and again, a casual work environment.


Paid Study Time


As an actuarial analyst you will be given 140 hours of paid study time per exam. This time may be used however you choose. Following is a description of some of the ways our analysts have chosen to use this time in the past.

Classes

You may choose to attend any classes that may serve as refreshers or help you in any way to prepare for the exam. The SOA, CAS or any other local or national organization may offer these courses. American Family will pay for the enrollment costs as well as any other materials that may be needed for the course.



Conferences and Seminars

You may also choose to attend a conference or seminar that is sponsored by the SOA, CAS or any other actuarial entity. American Family will pay for: your transportation, necessities while you are there (food and lodging), conference registration fees and any other materials that are needed.



Workshops

You could also choose to spend your time at a local workshop sponsored by the University of Wisconsin. These workshops are usually held on the NHQ campus and would only be one or two days out of your office. Again, American Family will pay for any costs associated with the workshop.



Your time to study

And last but certainly not least, you may choose to use your study time as you please. If you study best at home, or away from the office, then you may use this time to be out of the office. You may also choose to sign up to use a conference room here at NHQ.



EXAMPLE: Suppose that you find a conference in Atlanta, GA that is on Exam 4 material. You will need to bring the information to your manager to make sure that it is a conference that is covering the exam you are working on. Then, she/he will sign off on an approval for your attendance. From that time on, all you need to do is make sure that you are at the airport at the right time. American Family will pay for all of the costs associated with the conference.

First and foremost, this study time is yours and may be used however you choose. American Family wants to have the best actuaries in the industry, therefore, we do our best to encourage and support your success in whichever way benefits you the most.


Bonuses
American Family offers each of our Actuarial Analysts bonuses upon successful completion of each exam. These bonuses come in various forms and various sizes depending on the exam passed and the level the analyst has reached.

Monetary Bonuses

With each exam passed, you will receive a monetary bonus. The size of the bonus depends on the exam level passed.



Salary Increases

In addition to the monetary bonus, you will also receive salary increases upon successful completion of an exam. Because each analyst’s salary varies, this increase also varies depending on the analyst and their current salary level.



Promotions

As you complete the series of exams, you will also become eligible for promotions within our department. Again, these promotions may vary depending on the analyst’s experience with American Family as well as the level of exam completed. We do try to promote from within when openings become available.


Casual Environment
Once you get into our department, you will see how casual the workspace is. People may choose to work closely with other analysts or even people from other departments. Everybody in the department is extremely friendly and very approachable. They all also had a first day, so they will certainly lend a hand. You will find that the directors are also very approachable and knowledgeable. They are willing to help out or explain and teach whenever something is not clear.

You will also find that the work is self-paced for the most part. Sometimes there will be deadlines that must be met and may seem to come very quickly. It is in these situations that you will probably notice just how helpful the other analysts are. You will not have a daily routine, so each project that you work on will be different and challenge you in new and exciting ways. It is because most of this is unexplored that the time it may take is unknown therefore allowing you to work at your pace and with less stress.

The actuarial division is divided into four departments: Homeowners, Auto, Specialty Lines and Research. By the time you are reading this, you have probably met the director of your division and are familiar with the layout and purpose. This handbook will not delve into the separation, as your director will better explain your role.


Daily Duties


Your daily duties will never be the same when you walk into the office. Each project will be something that has never been done nor examined. You will find that your interpretation of the data being examined may differ from another analysts, or even the person asking for the information. Projects may come from your director or even other departments.

Especially now, in this time of great expansion, our division is busy working on exploring other companies’ experience in states that we are considering entering. We are working on computing their loss ratios and loss experiences. From these data, we try to project what our ratios would be and whether or not we would be able to profit from entering the state with our lines.

Another example of a current task is finding the relationship between credit history and claims. We have found that there is indeed a direct correlation between low credit history and high claims. As you may be aware, there is currently a strong push towards insurance companies not using credit in their premium analysis. American Family has decided not to include this as a determinant of premium, however we are trying to find what the correlation is and whether or not it is worth mentioning and examining further. We also want to find a way to perhaps tie this into our rate models in the most ethical manner.

Section


4

Your Investment



Your success at American Family Insurance depends upon your investment in the company. Your dedication and progress towards certification are what we need. You will also find that it is a personal investment with personal benefits.


Dedication


American Family asks that you show your dedication to a successful career as an Actuarial Analyst. You must show that you are willing to strive to pass exams, doing whatever it takes and making whatever necessary sacrifices to be successful. You must also demonstrate that you have determination to complete the exams and continue to educate yourself on current events and challenges within the profession.

The most dedication we ask for is your personal time being forfeited for the exams. Although we offer to pay for 140 hours of study time, each exam requires about 300-400 hours of study. You will find this takes a great deal of time away from your family and loved ones as well as your pleasure activities.


Progress
American Family Insurance requires that you sit at least once and maybe twice per year for an exam if you have not completed the series. These exams range from four to eight hours and are both multiple choice and essay format. The closest testing center to us is UW-Madison, however, if you’re from another city or town we can try to find a testing center that is more convenient for you. We also offer exams beyond Exam 4 here, at NHQ. On these days, we will also provide a social period, to include lunch, following the exam (although you may also choose to go home).


Certification


In our department, we require that you complete the CAS certification. We do understand, however, that not everybody may have made this decision yet, as it does not need to be made until completing Exam 4. Should you choose to complete the SOA certification, you can certainly see if we have anything available to you in another department, however, we will no longer work with the lines that you will as a member of the SOA. We do not try to force any one into the CAS and you may make the decision on your own. If you do decide to complete the SOA program, you will have decided that life and annuities are your specialty, which we simply do not service in this department. We would still encourage your success.


Personal Investment


The most important part of your investment in your position as an Actuarial Analyst with American Family Insurance is your personal investment. This career choice is an open invitation to success and a plethora of opportunity. As mentioned in the previous section, as you complete each exam, you will become eligible for promotions and new positions within American Family.

When an analyst completes his/her fellowship, he/she becomes eligible for manager positions. These positions over-see the analysts and respond directly to the directors of their department. They also receive a new salary classification. From this position, the manager may then strive to reach a position as a director of the department.

You will also find that you may wish to leave American Family and pursue a career elsewhere. Should this be the case, you will find that your experience here, and the efforts that have been put forth into your career allow you to move into other companies above an entry level. You may even choose to be a consultant and will depend on your experiences here even more.

Section


5

American Family’s Investment in You



You will find that we may set high expectations of our Actuarial Analysts, however we have also set the standards high for ourselves. We understand the commitment we ask of you, and make sure to recognize it through encouragement, study time, study peripherals, and alleviation of expenses associated with these.


Our Goal


Our goal, at American Family Insurance, is to help you pass exams and be a successful Actuarial Analyst. It benefits us the most to have accurate and competent analysts. We understand that by staffing the best actuaries in the country, we must be able to give what it takes to be the best in the country. Therefore, we provide you with many of the superfluous “costs” of success.

Paid Study Time

As mentioned before, we offer 140 hours of paid study time that you can use as you choose. For any of the national or local seminars, conferences or workshops, we provide:



American Family also pays for the exam fees for the first two times that you sit for the exam. These fees begin at $95 and increase as you progress through the series. This is just one other way that we want to take an unnecessary burden off of you as an analyst.

Library

We also have an on-site library that contains many study guides and classroom texts that are cover the material for each exam. These may be guides that are either published by the SOA or CAS or even have been put together by our on-staff analysts.



Study Groups

We also have study groups that are either organized by our staff analysts or actuarial directors. They commonly meet in the library during regular office hours. These study sessions are generally well attended and tend to serve each analyst with the information necessary to succeed. Fellow analysts will sit in to let you know exactly what material is emphasized and the best approach for passing the exam.


Section


6

Conclusion



When it comes down to it, you will notice that you have decided on a career and not a job with American Family Insurance. You will also find that whatever you are willing to put into your career will be matched.


Job or Career?


As a wise man once said, the difference between a job and a career is simple. A job is something that you make yourself wake up to do each day just to pay the bills and you come home at the end of the day to do something else that you enjoy. You know you have found a career when you lay in bed at night and cannot differentiate between your workday and doing something that you enjoy.

You have certainly found a career here at American Family Insurance.

You will also find that your personal commitments and investments in this career will be rewarded with corporate commitments and investments in you. You will always see that you are appreciated and your talent will forever be nourished and stretched. You will never feel that you are at work, nor under appreciated. American Family will invest in you and will reward you greatly as you succeed in your career.



Finally, we would like to thank you for choosing American Family Insurance as your new place for personal and professional growth.

References


www.amfam.com

Wanner, Greg. Director of Actuarial Research


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