Over the years, the once-separate worlds of property and casualty insurance and employee benefits have, if not collided, at least moved closer together. As consolidation reshapes the market, it's become more common for firms to sell both books of business, and innovations and strategies from one area have often bled into the other.

In this new reality, brokers on both sides are keeping an eye on new ideas, regardless of which market adopts them first. Here are some areas of the P&C world that benefits brokers are watching carefully.

Marijuana—P&C finds a market while benefits abstains

The legal issues around marijuana have probably never been more complicated. Cannabis products are legal in some states, illegal in others, with differing types of legality for medical usage. The federal government currently still classifies marijuana as a Schedule 1 drug, but has so far declined to prosecute companies in states that have legalized commercial marijuana businesses. The uncertainty and potential legal liability is keeping most benefits carriers and health plans on the sidelines for now as the marijuana industry continues to grow.

The P&C world, however, is a different story. The legalization of marijuana in certain states has created booming businesses that need insurance coverage for property and product. In states where medical or recreational marijuana has been legalized, marijuana-based businesses needing P&C coverage have found some partners willing to work with them.

One such partner is Cannasure, an Ohio-based agency that works with the carrier Topa Insurance Group to offer basic policies in commercial, product, and property liability. According to Kieran O'Rourke, director of underwriting for Cannasure, his company is aware of the federal stance on the legality of marijuana, but it has taken the position that if a state says a company is doing legal business, it can be insured.

"These owners should be able to buy insurance products; they're in real businesses," O'Rourke says. "We've looked at the angles and considered the exposure and have decided to move forward."

O'Rourke stresses that marijuana-related business owners are not anything like the "stoner" stereotype from popular culture. "The cannabis space is financed by very smart, professional people. These businesses have a robust, modern business approach and are run by entrepreneurs who see it for what it is: a great opportunity to experience capitalism at its finest."

On the benefits side, industry experts still express caution. Unlike insuring a company operating in a single state where cannabis is legal, health benefit carriers, and many self-insured businesses, operate across multiple states.

Craig Hasday, national employee benefits practice leader for EPIC Brokers, says demand for cannabis products is rising, but that the area is still too hot for benefits carriers to touch. "Health plans are taking a hard line that it isn't covered at all," he says of medical marijuana. "It's against federal laws, and the plans are federal contractors. I don't see that changing until there's federal action on legalization."

Technology, wearables and wellness

Another area that is exploding with new players and innovations is the technology space. In both the P&C and benefits world, mobile apps are all the rage, providing consumers with quick and easy access to and interaction with carriers, and allowing carriers to manage data in ways not possible just a few years ago.

Some observers note that telemedicine, although it's been available in different forms for a while, is being used more on the workers' comp side. "Technology has lead to an increase in usage of nurse triage and other forms of video communication for injured workers," says Briggs Orsbon, vice president of commercial lines for Indiana-based Shepherd Insurance. "Injured workers are getting care quicker, easier, and with less expenses, which should minimize employers' expenses for workers' comp insurance and employee benefits."

Wearables and tracking devices have been adopted on the P&C side to help with safety, efficiency and personalization. On the benefits side, wearables may also be helpful in wellness efforts, some say. "Telematics in the auto and transportation industry are being used to monitor driving habits and promote safer driving," Orsbon says. "This feels similar to the fad of employers requiring employees to wear tracking devices such as FitBits, to promote healthier lifestyles."

Hasday agrees, but notes other challenges that come with wellness. "There's certainly crossover between P&C and benefits when it comes to devices," he says. "In the past, wellness was all self-reported; tracking makes it more difficult to game the system and hopefully make wellness programs more effective. But there are differences. A device tracking whether a truck is going the speed limit can have an impact on safety claims. But there's no ROI on taking 1,000 steps a day."

Workers' comp: Bridging the gap

Debora Came, an agent with Amberg Insurance Center, based in Punta Gorda, Florida, has handled both workers' comp and health benefits insurance. She says her experience in the workers' comp field has underscored how important reporting and communications efforts are.

"Posted safety procedures are only good as the enforcement behind them," Came notes. "What I have seen [in P&C] is that some folks, when taking a liability for business, don't like to be forthcoming."

Laying out clear standards and enforcing them has been key to reducing claims in the P&C/workers' comp area, Came says. "Workers' comp in the past has been very misused. Now, with mandatory programs, using effective personal protective equipment, we see a dramatic decrease in losses, which saves companies and clients both."

"The biggest change has been the education of the employees that safety is everyone's business, not just the employer," Came adds. "Being accountable for your health, maintaining a healthier lifestyle should be the goal of everyone. We all get sick or hurt. But to invite it because of laziness or negligence is not a benefit to anyone."

Although standards and best practices have been widely established, Came says not all employers are doing their job in training employees—including work places that should know better. "Some health facilities do not enforce even the simplest of safety issues: laundry on the floor (leading to falls and slips due to fluid), overfilled sharps containers, trash not emptied due to staffing cutbacks, lack of training to the staff for moving patients effectively and ergonomically," she says. "Incentives for having this training and enforcing this training module would significantly cut down on work-related illness and injury, saving employers, employees and the general public millions of dollars each year."

Cricket Thomas, senior vice president and program director with Blue River Underwriters in Las Vegas, Nevada, says that employers need to be diligent about staying informed of their responsibilities regarding workers' comp insurance, because it has an impact on their other areas of insurance.

"In the workers' compensation space, it is imperative that insured's are knowledgeable regarding the exposures related to their operations and the necessary safety procedures/protocols they should have in place," Thomas says. "With the amount of information that is readily available from most insurance carriers in today's marketplace, as well as sources such as the internet, I've observed many changes in the past few years where insured's are implementing more stringent requirements such as drug testing, complete background checks and prior injury documentation as part of their hiring practices. Not only has this reduced the claims exposure for their workers' comp coverage, thereby lowering their premium costs, it has made an impact on the expense related to the medical/health plan benefits they provide for their employees."

The workers' comp/health benefit worlds remain stubbornly separated, which makes the system less efficient than it could be. "There's a concept of 24-hour care—whether it's health care emanating from workers' comp or from health issues outside work; it's still health care," Hasday says. "There's potential for 24-hour-health care to become a reality. It's been talked about for 25 years. The issue with workers' comp coverages is that some of them are statutory; and benefits are covered by ERISA, so it's very difficult to manage together."

Dan Thompson, CEO of the Clinical Wellness Network, which specializes in direct primary care networks, says his company's model has been gaining attention from multiple employers. Direct primary care allows businesses to contract for health care services with primary care clinics, usually with a catastrophic health care plan built in for more serious health issues.

"With the increased attention on direct purchasing, the provider is building a relationship that's more holistic with the employer," Thompson says. "The same provider could take care of the employees' medical needs and the occupational health needs. You could argue there's a higher probability of a better outcome because they have a relationship with that patient."

It remains to be seen where new models like direct purchasing end up in the insurance world, but innovation on both sides continues. As P&C and benefits brokers continue to grapple with similar issues and concepts, expect to see more cross-pollination between the two industries.

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Employee benefits and property & casualty insurance: Worlds apart?

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