In the C-Suite with Michael Mattix
Armed Forces Insurance’s General Counsel and Chief Claims Officer discusses his pioneering work in analytics, what it’s like to serve his distinguished group of policyholders, and his alter ego, “Vanilla Tort.”
By Taylor Smith
Where did you grow up?
I grew up in a small farming community in southeast Kansas. My dad and grandfather raised breeding cattle and had a farming operation. As with most small farms, he needed to earn additional money, so he also worked in construction. During my middle school years, we moved to Pittsburg, Kansas, a town of about 20,000 residents and home to Pittsburg State University.
My mom worked for the U.S. Census Bureau in Pittsburg. Lyndon Johnson’s “Great Society” had just passed Medicare, and a significant number of older Americans needed proof of age. Birth records in rural areas were unevenly recorded at best, so many people had to rely on Census data.
When you were growing up, what did you want to be?
After my days of being a ranch hand, I had aspirations of being a newspaper reporter. I was an avid reader and thought it was a good profession. As I progressed through school, I thought about being a college professor but, ultimately, decided to become a lawyer.
Where did you go to college?
I started at Pittsburg State University, but then completed my undergrad education at Kansas University in political science. Like many political science graduates, I decided to go to law school. I went to Northwestern. I received a broad-based legal education, but one course I didn’t take was insurance law.
Like many young attorneys, I fancied myself a litigator. After law school, I worked for a large law firm in Kansas City. I soon discovered that in most large firms, the opportunity to have actual trial experience early in one’s career is pretty rare. I later moved to a much smaller firm, where I obtained a lot of valuable “first chair” experience.
How did you first get introduced to insurance?
When my oldest child celebrated his first birthday, I realized that I had allowed my trial schedule and workload to interfere with my job as a parent. This was well before the phrase “work-life balance” came into vogue. While there are certainly lots of creative ways to deal with this concern that many of us share, I learned that a legal client, Employers Reinsurance, was hiring claims counsel. It sounded like a good fit, both professionally and personally, and it was—I stayed there 25 years.
How quickly were you able to learn the claims side of the business?
Lawyers typically don’t know much about claims adjusting and what insurance companies do—and I was no different. When I first worked at Employers Re, I met a colleague, Steve Henning, who offered to share with me everything he knew about claims, coverage, and claims management in exchange for any insights that I might have into the litigation management process. I have to say, it wasn’t a very fair trade for him. I learned a lot from him.
When did you take your first management role?
I moved to workers’ compensation at Employers Re within about a year of starting there. Shortly after that, there was an opportunity to manage a book of medical expense stop-loss business. After seven years, I moved to Florida to manage a run-off book of workers’ compensation business. When I returned, I entered General Electric’s Six Sigma training and became a certified Black Belt. Following my “graduation” from the Six Sigma program, I formed the client audit group at Employers Re, which also included a claims consulting function (ERC). We were truly a cross-functional, multidisciplinary group as we had CPAs, IT professionals, underwriters, and claims professionals coming together to audit reinsurance data as it came into the company.
Through our team’s efforts, ERC was one of the early entrants into the field of data analytics. We helped client companies improve their claims and underwriting operations through data analytics. We employed a lean Six Sigma approach combined with data analytics to discover solutions to improve cycle time, increase customer satisfaction, and decrease loss and expense ratios. That was exceptionally new for the industry at that time, and I am very proud of what we did in that group.
How relevant was General Electric’s purchase of Employers Re?
GE’s use of Six Sigma principles was revolutionary in the insurance world. Insurance was, and to some extent still is, fairly conservative. Insurance executives are not always the earliest adopters of new trends and technologies. Applying the Six Sigma principles that GE had used successfully in other industries to insurance was very novel. It worked because a business process is a business process. The basic tools and techniques worked quite well to reshape and redefine what we were doing.
You were exposed to many different lines early in your career. How important was that diversity in experience?
I can argue both that it’s important to specialize in one line of business and to have a diverse background in different types of claims. It’s great to develop a level of expertise in one area, but if your goal is to be in management, a broad base is better. It gives you a better ability to meet challenges that you may face down the line in your career. Today, it’s much harder to diversify. At AFI, we try to give people a broad range of experiences, but that’s not always possible. I think the perfect claims organization has a combination of both specialists and generalists with diverse experiences.
Do you think the industry fosters those who want technical careers and don’t want to be in management?
The assumption has always been that people want to move up into management, and many do, but it’s not 100 percent. In my current role, we’ve tried to create a parallel technical track for those who want the management pay but who are not interested in management. That allows us to keep that talent in our organization.
Tell me about Armed Forces Insurance.
We serve the personal lines insurance needs of active and retired members of the armed forces. We work and serve a great group of policyholders. It is an absolute honor to come to work every day. It’s a privilege to serve them and help put their lives back together after a loss. Unlike so many jobs, there is a greater sense of purpose and mission here because of who our policyholders are.
You use a lot of independent adjusters. What kind of skills and resources do you look for when evaluating adjusting firms?
To be perfectly honest, we were using hundreds of adjusting firms when I first arrived. Since then, we’ve narrowed it down to four or five main ones, primarily because I like to be able to identify who is giving us excellent service and outstanding customer service at a reasonable cost. My primary focus is to achieve the highest level of service for our policyholders. By rewarding outstanding vendors with a larger share of our business, I think we encourage them to continue to do great work. The same holds true with the law firms we use.
How would you describe your management style?
I’m collaborative. I believe in setting the overall theme for goals and objectives, but also I ask folks to take an active role in their own job satisfaction by determining the rules that they will live by for the next year. If I impose goals and objectives from above, I think they have very little chance for success. Mutually agreed upon goals and objectives with solid measurements are very effective.
I’m also a communicator. I try to be clear, concise, and consistent in my messages. People learn differently, so I try to deliver messages via different avenues—group meetings, emails, and walking around and chatting with people.
Tell me about your family.
I’ve been married for 32 years to a wonderful woman. She was a legal assistant early in her career and an office manager for an advertising specialty group. For several years, she was a stay-at-home mom, which was a great thing for our family. I have a son who just graduated from law school. My daughter is a nurse in a medical surgical unit at a teaching hospital here in Kansas City.
Where did you meet your wife?
I met her at the first law firm I worked at after law school. We became very good friends and hung out in the same circles. I will point out that we didn’t start dating until I left the firm!
Do you have any hobbies?
We love to travel, both in the U.S. and abroad. A few years ago, we were fortunate enough to take our kids to Australia for a few weeks. Those are the kind of memory-making trips that last for a lifetime. We often travel with a group of close friends. We just returned from an extended trip to St. Croix. My wife and I like exploring different wine regions, sampling the local wines wherever we travel. We also enjoy cooking together using local, fresh ingredients.
Is there anything you’d share that people may not know about you? Any hidden talents?
Well, most people would not know that I probably gave the first corporate presentation incorporating hip-hop and rap music back in 1990. I was giving a boring speech on notice requirements for our self-insured clients, and I decided to enliven things a bit. At the time, there was a recording studio at the local mall, so I laid down a rap track along with two colleagues. We did a summary of my talk in about two minutes as we danced across the stage. It was so badly done and so lame that it was funny and unforgettable. Whether my boss discouraged future attempts, or whether I foresaw the coming of YouTube, I essentially retired from “performing,” so those who missed it in 1990 don’t have much chance of ever seeing “Vanilla Tort”!