A 'heads up' from my insurance agentgreenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread
I recently received the following as an article in the newsletter published by my business insurance broker (Carolina Insurance Consultants---they handle my liability and work comp ins.). Same information that the government puts out ..... but with a different spin.
"The Big GOTCHA!! is at hand"
Of the nation's largest companies, only 48% expect all of their most important systems to be ready for the year 2000 according a new survey by Cap Gemini America.
This should concern you if you depend heavily on large businesses. How many large businesses supply your goods and services---financial institutions, manufacturers, utilities and so on? And how many are your customers??
According to the survey, one in five large companies expect that 75% or fewer of their critical systems will be completely tested and compliant by the end of 1999----and 75% have alreay experienced a year 2000 failure. the most frequent failures so far have involved financial miscalculation or loss (92%), processing disruptions (84%), customer service problems (34%), and logistic/supply chain problems (34%). Nearly every (99%) respondent expects systems failures to increase
The survey includes responses from information technology directors and managers of 144 major US corportations across all major industrial sectors as well as 17 fedral, state and local government agencies.
With time running out, we advise our small business clients to determine which products and services are most crucial to your business and make alternative arrangements whenever possible. And do it NOW.
This is most interesting because the broker stands to make nothing from this article. There is no such thing as y2k insurance in South Carolina....our legislature saw to that when they limited the legal repercussions from y2k. Regular liablity insurance will not cover any y2k problems and the general liability policy carrier has already notified all their clients that y2k is not part of the coverage.
I get the distinct impression from talking to the agents that they are running scared.
One other item. Today, the IT man that remediated my systems came by to run one more check. It rolled ok. But while he was there, he told me that a VERY large lab company that has him on retainer had asked him to be on call for the rollover. He informed them that he would do so for a minimum charge of 2 hours each day @ $750.00 per hour and that any work would be charged at that rate portal to portal. This means that even if he doesn't do anything but watch the football game, he will make $1500 for the weekend. The customer didn't even blink and agreed to the charges by fax within the hour. He says what they are afraid of is failure within systems that he has nothing to do with and their suppliers have told them they are on their own. (Nice people, huh!)
-- Lobo (email@example.com), December 23, 1999
Sorry...the quote should end at "And do it NOW!" The post after that point is mine entirely.
-- Lobo (firstname.lastname@example.org), December 23, 1999.
I'd be wary if I were him.
They may very well be of the sentiment that $1,500 is a *very* cheap price to purchase a Designated Scapegoat if the fan goes brown.
About ten or twelve years ago, a certain physician came into my store inquiring about a tape backup drive. He was very concerned about protecting his data. He wanted to know if I could sell him a drive that would work with his billing computer. I said I'd stop by and look at it, but I didn't see any reason why it wouldn't.
One thing kinda bugged me though -- he kept asking if I would guarantee that if he bought the tape drive, I'd guarantee that his data would be OK, and if it wasn't, I'd spend the time and effort to *make* it OK. Seemed like a strange question, but I more or less wrote it off to him having United Statesean English as a second language (he was from India or Pakistan). I tried to explain that no, the only guarantee was from the manufacturer -- that the drive would perform as described. He then tried to corner me with stuff like, "if you install it, then you're responsible for my data, blah blah blah". I again, tried to correct him, an he persisted in trying to push me into accepting responsibility for his data if "anything" happened after he bought a tape drive. I was *rapidly* losing interest in the few bucks I'd make on the sale.
Well, I get to his office, and of course, they're all SO f*cking important that they've GOT to let me know *how* important they are by making me cool my heels for a half hour.
But while my heels were cooling, my ears were burning!
As I stood there, the office manager -- his wife, I believe -- was on the phone with [drumroll] the vendor for their billing software. I only heard one side of the conversation, but what I heard made my blood run cold.
Their data was scrambled, and the vendor was refusing to do a damned thing unless they paid beaucoup bucks.
Suddenly, it all clicked.
These bastards were up sh*t creek, and looking for *someone* to hang it on.
If I sold him that drive, and accepted his terms, I'd be his slave, and I'd either work my ass off unfarkling megabytes of *proprietary* data, or, more likely, paying the *vendor* whatever fee they demanded.
And even if I *didn't*, accept his terms, I had no doubt that he'd lie and claim that I did, and drag me into court. He'd already proven himself to be a slimeball, so the way I saw it, he was capable of anything a that point.
So, I took the only viable option they left me. I informed them that my drive wouldn't work in their machine, I didn't know what kind would, and their best bet would be to talk to the outfit that supplied the computer and the software (a package deal from a VAR).
I then hightailed it outta there counting my blessings.
Like I said, I'd think twice about that "easy money" offer. You know what they say: if your attack is going too well, it's an ambush. [g]
-- Ron Schwarz (email@example.com), December 23, 1999.
Ron, you're one smart feller! Can you imagine the trouble the Insurance Industry will have over the next (decade?). Bet their reinsurers are having fits. I question a companies legal right to restrict coverage in mid-term. For one thing,it could imply that coverage was provided prior to the endorsement. Also, they would like to eliminate their exposure to the "Sue And Labor Clause" (Read Your Policies). Can you imagine the Time Element Losses which could be incurred (Business Interruption, Loss of Income, Business Shutdown Extra Expense) not to mention actual physical loss. EDP Policies tied into a Commercial Package Policy! Large Industry giants (ie.AIG) have a ton of "Treaty" insurance but cede off a TON of exposure Facultatively...Excess/Prorata to Reinsurance Cos.. I think we will see the courts backed up like never before and will see a lot of Insurance Cos (and Reins. Cos.)go "belly up" and the losses will be too great for the States Catastrophe Pools to even come close to bailing them out. Bottom Line...many Insureds could go under ALONG with the Insurance Companies because the Ins. Cos's. Reserves just won't be enough....and to compound that, if the markets crash they'll be in even worse trouble..if that's possible. Those Greedy Bastards have been "Cash Flow Underwriting" for too long now! They didn't have to make an Underwriting Profit as long as the markets kept hitting the stratosphere...They just wanted "CASH FLOW"...Well now these hot shot high rollers are about to hit the wall!I would suggest everyone read their policies NOW!
-- Larry (Rampon@Cyberramp.net), December 23, 1999.
Smart man, that Larry.
To the top.
-- cgbg jr (firstname.lastname@example.org), December 23, 1999.
I agree with Larry. Totally. As an agent P&C I can tell you all the industry will be hit hard. I doubt if I have a job come Jan. But if you want to hear something scarey, here it is.....A biggie company called our agency and they were doing y2k check to see if we were compliant...Do you know how this company checked compliance from us a 'vendor'? Simply by asking over the phone "Are u Compliant"? Scarey aint it?????? As for the lawyers, they are already lined up at the door......
-- consumer (email@example.com), December 23, 1999.
Like Ron said, if your an IT company, you have to watch your ass right now... we refused to do any remediation unless we got a liability waiver before we touched shit... but even then, some outfits have tried to get us to put our butts on the line.
For example, a local branch of a large non-profit organization contracted us to inventory their systems for y2k, which we did, and basically told them they were toast. We agreed to bring the hardware compliant, but they were responsible for the software, especially the propriatary accounting system they used. All the other software they used, ie., Microsucks, Novell, were all pirated, no legal license for any of them, and we told them we would not help there unless they bought legal licenses.
Well, they bought a legal copy of Novell, we installed it and patched it. And again reminded them they needed to do something about the rest...
Needless to say, a week ago they tried to get us to give them a letter certifying they were compliant. Naturally, we said FU, your not compliant... they then cried to the board, which has honchos from a lot of the large companies, utilities, etc., that we were refusing to do the job we had "contracted" for...
Fortunately, we documented the whole thing as we went along, so they didn't get their letter, and as of today, their still in toast territory come rollover...
It seems a whole lot of people are less concerned with fixing the problem, than with fixing the blame....
-- C (firstname.lastname@example.org), December 23, 1999.
I share my office building with an insurance agent. I commented to one of the associates that I had stocked extra coffee because I imagined there would be a line of people out the door after rollover. I asked her if they would be open early for claims. She said, "oh, no. Y2K isn't covered, period."
-- marsh (email@example.com), December 23, 1999.
we did a govt remediation contract for a nat resource mgmt agency. they only had money for a contingency (15% of base functions of a mainframe due to fly into the cdc like a rock) but wanted a whole replacement system for the bucks. they owned the mangement of the project including technical direction and we documented every fart and twitch as we went along so we are clear. But they never got it together enough and will suffer at least 80% productivity drop. problem is that this amounts to a potential 30 or 40 million dollar loss to state. oh well. what the hell?! why should govt suddenly get eficient and competent just cause a cdc?
-- pliney the younger (firstname.lastname@example.org), December 23, 1999.
From: Y2K, ` la Carte by Dancr (pic), near Monterey, California
If my house burns down, I'm filing a claim.
-- Dancr (email@example.com), December 23, 1999.