Nerney: How sports and insurance are alike

Thomas P. Nerney is chairman, president, and chief executive officer of U.S. Liability Insurance Group in Wayne, which has a program to help its college interns reduce their college debt. (David Swanson / Staff Photographer)

OK, it takes a basketball coach to draw a parallel between sports and insurance -- and my journalism pen cap goes off to Thomas P. Nerney, chairman, president and chief executive of United States Liability Insurance Group in Wayne.

Take it away, Tom. (Nerney, by the way, coached college basketball for a year before starting his insurance career, with a degree in philosophy, not business.)

"I think there are strong fundamentals in our business and if you understand what those fundamentals are and you work toward them you can have some success. I’m sure like your business – there are lots of distractions. But if you are distractable, you can waste a lot of time. If you can identify what you are good at, and work towards it, you can achieve some good things.  I think that’s sort of true in sports and in some other things in life," Nerney said during our Leadership Agenda interview published in Monday's Philadelphia Inquirer.

What's alluring about insurance in particular? I asked Nerney. (Through brokers, his company sells 113 different insurance products to small businesses and nonprofits.)

"It has those fundamentals," he said. "I don’t know that I would be a good CEO for the bio tech industry or the technology industry where you are coming out with a product and you are boxing everybody out. In our business, it’s a free enterprise system. There are no secrets, so the best player wins. It’s very stable. Very stable, mature."

So what's the threat to the business?

Complacency, he said. "You just get up every day and compete and you can lose the business to anybody."

I asked Nerney to tell me about a product line that he finds interesting. After he said he loved them all, he launched into a long spiel on liquor liability -- insurance the company writes for bars, fraternities, clubs, anyplace that sells or serves alcohol.

"We have a team of people that really understand this business," Nerney said. 

"If we have a claim on a bar [where a patron]  got in a fatal accident, that killed somebody, mangled somebody else, you have to investigate that to find out whether our bar really was the cause of that situation," he said.

"The plaintiff attorneys all know that all insurance companies all fold at some point. We will risk going to a jury trial if we feel we have to – so you need to be able to do that in that business, or you are going to get your brains beat in. You have to understand how to go about battling that. You don’t just write the claims, you have to investigate it. There’s just a lot of different things you have to do. Just how you take a blood sample, serum versus some other way. It’s unbelievable what you can learn. It’s kind of unbelievable when you can see the pattern of a claim and its result.

"Having said that, in 2001, we had a liquor liability claim in Rhode Island – at a Chinese takeout," he said. "You go to the Chinese restaurant. You are waiting for your food, you order your drink and there’s a video and we’re watching. You look fine, everything’s great. You get your goods and you leave. And so, that was the case. You had an accident. An accident occurred. We investigated it. We see the video. You didn’t look drunk. We investigated – you didn’t over drink. Short version, we take it to a jury trial. We had a $1 million policy. The jury found a $15 million verdict. We had to pay. So, on a case that we would do again, the same way. you just never know. We wrote a check. We wrote a check for $15 million and cried.

"The point of the matter is, as an insurance company, you have to write a check, so, these things happen," he said. "You can’t have them happen a lot, but liquor liability as a class of business is a very interesting class."

Click here to read Monday's blog on how Nerney fosters young talent.