ERIE, Pennsylvania — About the only sign of normalcy in this city, which shares its name with the lake it hugs, is its weather. It’s April, and the familiar spring pattern is here: stormy skies, downpours, sunshine, then back to stormy skies, and repeat. Lake-effect weather, they call it.
Tim NeCastro is not in his office, which for him is something disquieting but necessary. The CEO of Erie Insurance and native son is at home like the rest of his workforce has been for nearly a month, doing their jobs.
The Fortune 500 company is both the city’s and the county’s largest employer, with the bulk of its 3,600 local employees normally working in the downtown campus. These are people who spend their time and their money eating lunch, grabbing coffee, staying for dinner or drinks, or going to the theater.
But many of these employees don’t live in the city proper, and with a stay-at-home order in place, they aren’t making trips from the suburbs to the city center. This means that the poorest ZIP code in the state, which had been making a comeback after becoming a designated Opportunity Zone under the Tax Cuts and Jobs Act of 2017, is now a ghost town.
NeCastro is concerned about those downtown businesses. “I’m worried about them in terms of their presence here in our town,” he says. “The type of worker that is being displaced by this in many cases is a worker that can’t afford to be displaced for any period of time. I think we’re all very sensitive to that.”
“We’re trying to support local businesses as much as we can. But the outcome, I look at it in context, and I think what’s happening here is happening everywhere. Anybody who lives in any town should have concern with what the long-term impacts of this could potentially be.”
John Persinger, the CEO of the Erie Downtown Development Corporation, the nonprofit organization developing several of the Opportunity Zone projects in and around the Erie Insurance campus, said that the shutdown hasn’t affected the organization’s development schedule yet. “But if this shutdown continues for an extended amount of time, development schedules will definitely start to slide.”
Persinger says the EDDC board voted to waive the rent for its new tenants during the mandated shutdown period. “We have a number of retail and restaurant tenants who have had to shut down. They were very appreciative of the rent abatement. But without the rent revenue coming in, we need to figure out how to pay for the expenses utilities, tax bills that keep coming.”
“Ultimately, I believe we will emerge from this uncertainty okay, and our revitalization efforts will keep moving forward,” Persinger says of the development that began last fall.
The decision to move operations happened pretty fast, NeCastro said. “We went through a phase in the beginning of March where we initially responded by creating options for people,” he added. “That lasted less than two days. And it hit me: We can’t allow people to go into harm’s way and have that associated with our organization.”
Within a week, the largest employer in the city was migrating to an entirely remote work arrangement — “not with a sense of panic but with a sense of dispatch. We were very serious. This was not a debate. We are sending people home.”
The company has roughly 6,000 workers nationwide, and the breakdown of getting 6,000 people to work from home expediently was challenging, says NeCastro. But there was no shutting down either. Insurers need to be there when claims are filed. A virus like this one might reduce auto accidents, but it doesn’t stop them. It won’t prevent houses from catching fire or life insurance claims.
“In minor cases, we have that capability where photos are submitted and we can adjust the claim that way,” he explains. “In more severe cases, significant injury, death, total loss, fire, and a natural disaster — what happens if another set of tornadoes run through Nashville? We’ve got to be at the ready. And so what we’ve done is we’ve prioritized provisioning resources to those people who have those customer-facing experiences.”
“We’ve also given them guidance and latitude in how they do it. So we’ve increased, for instance, the amount of adjusting authority our agents have. We’ve also raised the authority to adjudicate claims … in order to free up the resources that then we put on the ground and then tend to a client situation or customer situation in person.”
In short, those adjusters are given a lot of latitude to use their best judgment.
“And they’re good,” NeCastro says. “If I’ve heard it once, I’ve heard it 20 times in the last few weeks. Our people are leaning into this. This is like our time to take care of our people. And so while we’re trying to tell people to stand down as much as possible, their reaction isn’t, ‘This is time to stand down.’ Their reaction is, ‘We’re the people who know how to evaluate these types of situations. Let’s make sure we’re there for our people.'”
Still, none of this has been easy, NeCastro says, because it all came on so fast. “Every day is another evolution.”
