ACCOUNTING%20CAREERS%20IN%20INSURANCE

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Indiana University POOP Session Financial
Opportunities January 28, 2003
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DEFINITION

• Promise
• Transfer of Risk
• Indemnity Principle
• Social Device

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REGULATION

• Highly Regulated By the States

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FINANCIAL STATEMENTS
GAAP vs. Statutory Accounting

• Operating Statement
• Statement of Assets and Liabilities

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OPERATING STATEMENTS
Earned Premiums (Sales) - Losses (Cost of Goods
Sold) - Operating Expenses -----------------------
---------------------- Underwriting
Profit/Loss /- Investment Income ----------------
----------------------------- Operating Net
Income
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STATEMENT OF ASSETS AND LIABILITIES Admitted vs.
Non-Admitted
Premium Receivables Investment Assets - Loss
Reserves - Unearned Premiums - Operating
Liabilities --------------------------------------
------- Policyholder Protection Fund
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TYPES OF INSURANCE

• Life
• Health
• Property
• Casualty

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STATE FARM PRODUCT LINES
Auto Health Fire Life Financial Services SF
Bank Mutual Funds
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INDUSTRY SCOPE

• 7,200 domestic insurance companies
• 2.3 million jobs
• 3.4 trillion assets
• 900 billion premiums

Source Insurance Information Institute 2000
Fact book
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STATE FARMS INDUSTRY POSITION

• Ranked 25 within Fortune 500
• 1 U.S. Auto insurer since 1942
• Insure 1 of every 5 automobiles
• Met goal - 40 million Auto policies by 2003
• 1 U.S. Home insurer since 1964
• Insure 1 of every 4 homes
• Top U.S. insurer of pleasure boats

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ACCOUNTING STRUCTURE

• Centralized vs. De-centralized
• Corporate
• Zone Offices
• Insurance Support Centers (ISCs)
• Supervisory vs. Analytical

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CORPORATE FUNCTIONS

• Financial Reporting Analysis
• Tax
• Investment Accounting

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CORPORATE FUNCTIONS

• Accounting Benefits
• Loss Reserves
• Data Management Services

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CORPORATE FUNCTIONS

• Auditing
• Treasury Services
• General Accounting Services

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CORPORATE FUNCTIONS

• Financial Shared Services
• Accounts Payable
• Agency Compensation
• Employee Compensation
• Travel Expense
• Shared Services Process Analysis

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CORPORATE FUNCTIONS

• Compliance
• Change Management

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SYSTEMS

• Financial Business Analyst
• Current Systems Support
• New Systems Development
• Create and maintain detailed operating procedures

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ZONE OFFICE FUNCTIONS

• Premium Payment Processing
• Cash Disbursements / Claims Support
• Agency Compensation
• Self Audits
• Transformational / Expense Analysis

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GENERAL DUTIES

• People Skills
• Organization Planning
• Problem Solving
• Time Management
• Communication
• Coordination

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SPECIFIC DUTIES

• Analysts
• Project Development
• Operational Assistance
• Functional Area of Expertise
• Supervisors
• Performance Management

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TECHNICAL TRAINING

• On-Line Operating Procedures
• Hardware and Software
• PeopleSoft Application
• Microsoft
• Numerous proprietary applications
• Supervisory Skills
• CD-ROM Leadership Development Series

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PROFESSIONAL DEVELOPMENT

• In-House Courses
• Insurance Education
• ChFC, CLU, CPCU
• Professional Designations
• CPA, CMA, MBA

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CAREER PATHS
Stability
Diversity
Opportunity
Mobility
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IDEAL CANDIDATES

• Accounting majors with a minimum of 9 hours of
  CIS/MIS
• Finance and Other majors with a minimum of 9
  hours of Accounting and 9 hours of CIS/MIS
• CIS/MIS majors with a minimum of 9 hours of
  Accounting
• B GPA overall and in major

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IMPORTANT TRAITS

• Real world experiences
• Technical skills
• GPA
• Leadership qualities
• Personal presentation
• Attitude
• Ability to learn

• Problem analysis and analytical thinking
• Customer service orientation
• Adaptability, drive and initiative
• Proven track record
• Passion for work

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BENEFITS

• Medical and Life Insurance
• Defined-Benefit Retirement Plan
• Profit Sharing (401K match)
• Education Costs
• Flexible Work Hours

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STATE FARM DATA
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STATE FARM DATA

• 19 Affiliated Companies
• Mutually owned company
• 71.6 million policies in force
• 117 billion in
• Assets (12/31/01)
• State Farm Associates
• 16,500 Agents
• 78,155 Total Employees
• About 2,000 Accounting Employees

Source August 2002 People Counts
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WWW.STATEFARM.COM