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|special} IIAI 2010 Iowa Legislative Survey

VOLUME 28 / ISSUE 3 / SUMMER 2010 / INDEPENDENT INSURANCE AGENTS OF IOWA

|Company Meetings} Farmers Mutual Hail  GuideOne Insurance  Midwest Family Mutual  Wellmark BlueCross BlueShield ALSO FEATURED INSIDE:  Trusted Choice  Your Watchdog  IIAI 104th Annual Convention and Trade Show  2009 Data Shows Iowa Independent Agents Outperform the Competition  Young Agents Conference  What’s Your Political Affiliation?


It’s a Breeze... to do Business with Us New agents appointed by The IMT Group are quickly finding out how fast, easy and great it is to do business with us. Here’s why: • We pay top of the line commissions and contingency. • With input from participating agents, we have designed internet systems that are a breeze to use. • You can call anyone at The IMT Group for help or assistance. • Our number one customer … you, the independent agent. • Our auto, business and home products are very competitive. • We are a financially strong Midwestern regional insurance carrier. You could say we are a throwback to the past … with an eye on the future. Be worry free with IMT.

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West Des Moines, IA • 800.274.3531 • www.imtins.com


President’s Report Trusted Choice

Independent Insurance Agents of Iowa 4000 Westown Parkway West Des Moines, Iowa 50266 (515) 223-6060 • FAX (515) 222-0610 800-272-9312 (In-State only)

Advertising Editor Melissa Meiners

BOARD OF DIRECTORS

Advertisers

by Jeff Bohnenkamp, CIC

25 AmTrust North America

Page 5

56 Berkshire Hathaway Homestate Companies

National Directors Message

59 Acuity

6 Bituminous 52 Burns & Wilcox 10 Celina Insurance Group

President

Your Watchdog

28 EMC Insurance Co.

President-Elect

“The Independent Insurance Agents of Iowa, (IIAI) as an organization is dedicated to its agents and company partners and is continually striving to do what is right for its membership.”

22 First Western Insurance

Jeff Bohnenkamp, CIC - Spencer Mark Currie, CIC, CPIA - West Des Moines

Treasurer

Brian Petersburg - Decorah

National Director

Tom Richardson, CIC - Keokuk

by Tom Richardson, CIC

Directors

Page 7

Paul Pohlson - Grinnell Terry McDonald, CIC - Iowa City Scott Morningstar, CPCU - Lisbon Jerry Mease - Winterset Eldon Hunsicker - Ottumwa Terry Friedman, CPCU - Dubuque Tim English, CIC - Dyersville John Dalton - Council Bluffs Steve Madsen - Marshalltown

Past President

Hans Boehm, CPCU - Boone

Chief Executive Officer Bob Skow, CPCU, CAE bob@iiaiowa.org

Membership Operations Coordinator Melissa Meiners melissa@iiaiowa.org • Ext. 15

IIAI OFFICE STAFF

“IIAI has become an all in Trusted Choice state. All members will be automatically eligible for the Trusted Choice Program as part of their membership.”

Technology & Communications Administrator Jeanne Reynolds jeanne@iiaiowa.org • Ext. 17

In This Issue Farmers Mutual Hail

49 Big I Professional Liability - IIAI 11 Big I Professional Liability - IIAI 2 The IMT Group 19 IMWCA Iowa Municipalities Workers’ Compensation Association 6 Insurance Finance Corporation 9 Integrity Insurance 16 Iowa Municipal Insurance, LTD

GuideOne Insurance

14 Iowa Mutual Insurance Co.

Page 17

24 JM Wilson

Midwest Family Mutual

20 LeMars Insurance Co.

Page 21

24 Merchants Bonding Co.

Wellmark BlueCross BlueShield

10 M.J. Kelly Company

Page 26

49 Northern States Agency

Independent Insurance Agents Of Iowa 104th Annual Convention and Trade Show

8 Pekin Insurance

Page 29

2010 Scholarship Winners Page 35

Furnishing MVRs…Legal But Not Permitted

Membership Services Coordinator

2009 Data Shows Iowa Independent Agents Ourperform the Competition

Linda Brazelton linda@iiaiowa.org • Ext. 16

36 Big I Flood - IIAI

Page 13

Membership Services Coordinator Marilyn Paul, CPCU, AIT, AAM, CPIW marilyn@iiaiowa.org • Ext. 11

43 Grinnell Mutual Reinsurance Co.

Page 37

50 Progressive 40 Rain and Hail 23 RDS Group 10 Ringwalt & Liesche Co. 55 Rural Community Insurance Services 18 Sagamore Insurance Co. 33 SECURA Insurance Co. 16 State Auto Insurance Companies

by Bob Skow, CPCU, CAE — Chief Executive Officer

34 Society Insurance

Brenda Kluger, MBA, CIC, CISR, CPIW brenda@iiaiowa.org • Ext. 14

Page 39

4 Vertafore

Membership Services Coordinator

Young Agents Conference

15 West Bend

Page 51

Membership Services Coordinator

Marie Huggins marie@iiaiowa.org • Ext. 22

Receptionist

Cindy Grim cindy@iiaiowa.org • Ext. 12 Viewpoint is a publication of the Independent Insurance Agents of Iowa. Viewpoint is published quarterly: Winter, Spring, Summer and Fall. Viewpoint is mailed to Iowa insurance agents, Iowa Home Office Executives, Affiliate members, and other state associations and organizations.

What’s Your Political Affiliation? by Bob Skow, CPCU, CAE — Chief Executive Officer

44 Taylor Insurance Services

We would like to thank our advertisers for their support. This magazine would not be possible without them. THANK YOU!

Page 53

IIAI 2010 Iowa Legislative Survey Page 57 MISSION STATEMENT: The Independent Insurance Agents of Iowa will be an ­unrelenting advocate of the business, professional and ­political interests of its members; doing so by working in the ­public’s best interest and with the highest ­ethical standards.


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president’s report

Trusted Choice}

|

IIAI has become an all in Trusted Choice State By Jeff Bohnenkamp, CIC

|Things with change at the

continue to be busy

Association during our enjoyable summer. If you have not had a chance to see the improvements to the office entrance and parking, I encourage you to do so the next time you’re in the neighborhood. The entrance area has been landscaped to have a courtyard area with tables and benches to enjoy the outdoors. The furniture was donated in the memory of Dan Fulwider with hopes that it will be enjoyed by staff and agents. Also, additional parking spaces were added in front of the office. I think you will agree these are nice additions and should eliminate the movement of the entrance surface that was caused by the frost each year. IIAI membership meetings in June shared news of change in our organization. The new Big “I” logo was released. It was designed to brand independent agents in this evolving marketplace. IIAI has become an all in Trusted Choice state. All members will be automatically eligible for the Trusted Choice Program as part of their membership. By now you have heard our new Iowa Trusted Choice Spokesperson, Dr. Tom Davis, and one of two new ads being run. The second television ad will run during our fall campaign. We are excited to have Dr. Tom as our familiar face in these ads. Before you know it, the fall campaign of ads will be running. Don’t miss your opportunity to join this advertising program. It is a great bang for the buck. Also during June statewide meetings, Scott Deetz with Entrepreneurial Advantage laid out the groundwork taking place on the consumer/agent internet portal. This is a great chance for independent agents across America to be branded together under the Trusted

Company and Public Relations, Jerry Block, Chairperson; Rural Agents/Small Town Agency, Kathy Mens, Chairperson; Technical & Industrial Affairs, James Krist, CIC, MBA, Chairperson; Young Agents, Justin Davis, Chairperson; Education, Todd Stadtlander, Chairperson; and Governmental Affairs & IIAI PAC chaired by Jim Lane, Jr., CPCU, RPLU. Enjoy the great summer weather. Before you know it the change of seasons will be upon us. Again, thank you for allowing me to serve as your Association President. It is truly an honor and a very enjoyable experience.

“IIAI has become an all in Trusted Choice state. All members will be automatically eligible for the Trusted Choice Program as part of their membership.” Choice search engine to regain and maintain market share through the use of the internet. Thank you to all of the volunteers that serve on the various committees. June 3rd the Annual Committee Meetings were held at the Sheraton in West Des Moines. We had a great turnout. Through your combined efforts and participation we continue to make a difference protecting our industry and the Iowa insurance consumer. If you are not already on a committee please consider joining your peers in guiding our Association. The standing committees are: Agency Management/ Technology, Doug Follmann, Chairperson;

SUMMER 2010 |

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national director report

YOUR WATCHDOG}

|

The Big “I” of Iowa is your voice and your watchdog for what affects you as agents in the Iowa legislature. By Tom Richardson, CIC

|I AM three year term as Iowa’s

now half way through my

National Director, and it has been a busy and overwhelming year and a half. Balancing my business, community involvement, family, Big “I” state duties, and finally National Big “I” commitments takes a lot of work, planning, and time. What is great about it, is that I wouldn’t trade this opportunity for anything. I’ve said it before in these articles, and I will say it again, Independent Insurance Agents are the best people I know, and I appreciate every minute that I’m working with, and for them. Having been Iowa’s National Director for 18 months, I can make two statements that sum up my perception of our state and national association: 1. The Independent Insurance Agents of Iowa, (IIAI) as an organization is dedicated to its agents and company partners and is continually striving to do what is right for its membership. Sometimes what is lost in all of this is that what is good for the agents and companies is in the end good for the customers and consumers. When agents and companies are doing well, the consumer seems to share in those benefits with lower rates, and greater service. The Big “I” of Iowa is your voice and your watchdog for what affects you as agents in the Iowa legislature. In today’s State political climate, the need for a strong and effective Independent Agents association is more important than ever. 2. The Independent Insurance Agents and Brokers of America, (IIABA) is the most effective voice for property

Anyone that has ever talked to me, read my Viewpoint articles, or for that matter read any of the articles published by the IIAI knows how focused we are in getting this message out: The IIAI and IIABA works for you! If you ever question the value of your Independent Insurance Agent membership, think about points 1. and 2. above. Nobody advocates for Independent Agents like your State and National Associations. And, if not these Associations, then nobody will. There is really no second line of defense ready to take up the cause, and there is no backup Association; its pretty much just us! Unless you have been involved at a

“The Independent Insurance Agents of Iowa, (IIAI) as an organization is dedicated to its agents and company partners and is continually striving to do what is right for its membership.” and casualty agents in the country. No other property and casualty organization does for its members what the IIABA does for the Independent Agents of America. There is no better voice and advocate for Independent Agents in Washington DC, and around the county than the IIABA, and that has been proven to me by the IIABA’s relentless work in getting the Independent Agents’s voices heard on capital hill for health care reform, crop insurance, and the federal regulation of insurance.

State or National level, you just cannot appreciate the amount of work, time, and effort that goes into watching out for the best interest of agents around the state and nation. If I have to give myself a grade for the first half of my National Director’s term, it would be about a C+. A former National Director once told me that you spend the first two years of your term figuring out what is going on, and the last year actually being an effective director. Then, its someone else’s turn to take over. I couldn’t agree more with that statement. I can give myself an A for effort, but a D for real effectiveness. However, I’m a

SUMMER 2010 |

|7


NATIONAl dIRECTOR REPORT

firm believer, that if your heart is in the right place, then the correct decisions will be made. There are three major accomplishments by the IIABA and its Board that have taken place this past 18 months that I would like to highlight for you. These are by far not the only accomplishments, but they are the ones that I feel have the most impact on agents. 1) Health care reform. 2) Trusted Choice is now the IIABA’s National Brand. 3) Consumer-Agent Portal. (CAP) All three of these initiatives have, and will continue to take a lot of time and effort from the National Board, the individual State’s, and our staff at National for years to come. Health care reform is far from finished, and it will be on our national radar screen for years to come. We will have to work even harder in the future to

keep Independent Agents as the delivery system for our health insurance for the future, whatever shape it may take. Trusted Choice is now a permanent part of our new Big “I” Logo, and it is our new consumer brand. I like what it says to the public about who we are, and what we do, and I truly believe that the Trusted Choice brand will resonate with the public. Give it time, and I think you will like what it does for the Independent Agents. And finally, CAP is something that can

only be accomplished by having a strong National Association willing to put the time and money into assisting Trusted Choice agents to keep and re-capture lost personal lines market share. CAP was created with one thing in mind: Help our agents compete and maintain marketshare in today’s internet world of doing business. You will continue to hear more and more about this program, and I hope you will understand and appreciate the amount of work and time your National Association has put into this program. Thank-you again for allowing me the opportunity to represent the Independent Insurance Agents of Iowa on your National Board. I’m proud to be an Iowa agent. Have a great summer.

beyondtheexpected.com

one Dream enDs

“It was hard to believe. Our grocery store burnt to the ground. We were walking through the wreckage…and my son saw the ice tongs among the rubble...”

AUTO

HOME

– Policyholder since 1999

BUSINESS

LIFE

another begins

HEALTH See Brett’s entire story at

beyondtheexpected.com

Going beyond the expected in rebuilding lives. And dreams. it’s what we do. In calm times. In times of distress. Count on Pekin Insurance™ to go the extra mile. Our policyholders appreciate that. As do our agents. From providing outstanding products at competitive rates to high-tech solutions that streamline business, we do whatever it takes to help our agents build their business…and customers like Brett build – or rebuild – their dreams. Going Beyond the expected.™ That’s what you can expect. From Pekin Insurance. Become a part of it. Call Pekin Insurance today at 800-322-0160, Extension 2662. Or visit pekininsurance.com

8|

| SUMMER 2010


Dawn Green

Personal Lines Underwriter

"We try to make things easy for our

agents – it’s the little things that can make a big difference."

Discover the Integrity difference, contact Cathy Beaudin at 800-348-1741 ext. 8326.


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You’re an independent agent.

Who’s got your back?

The Big “I” Professional Liability Program Protect. Prevent. Prosper. Our risk management resources keep your agency from making common preventable mistakes.

Our superior coverage through Swiss Re and our expert claims teams are in your corner in the event of a claim.

When you know you have the best agency E&O protection, you can focus on growing your most important asset–your business.

The Big “I” and Swiss Re are jointly committed to providing IIABA members with leading edge agency E&O products and services. The IIABA and its federation of 51 state associations endorse Swiss Re’s comprehensive professional liability program.

www.independentagent.com/EO

Insurance products underwritten by Westport Insurance Corporation, Overland Park, Kansas. Westport is a member of the Swiss Re group of companies and is licensed in all 50 states and the District of Columbia. ©2008 Big “I” Advantage, Inc. and Swiss Re


Company Meetings}

year IIAI Agents meet with

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report involving four companies follows:

2010 IIAI


FARMERS MUTUAL HAIL}

|

Farmers Mutual Hail: Providing Peace of Mind for Midwest Farmers since 1893 By Kevin Johnson

|Farmers Insurance

Mutual Hail

Company of Iowa (FMH) has been providing peace of mind for Midwest farmers and their families since 1893 by providing crop insurance in 15 Midwestern states and maintaining a Reinsurance Department for accepting risk from both domestic and international insurance companies. FMH began in Early, Iowa, as a crop hail only insurance company, and moved to Des Moines, Iowa, in 1894. After more than 100 years, the company entered the multi-peril crop insurance market in

“Our customers have come to rely on our unmatched financial security and excellent claims service – we now have more than 680 adjusters servicing our writing area.” 1998. FMH has most recently expanded the new line of business into Michigan, Oklahoma, and Colorado for the 2011 crop year. Our customers have come to rely on our unmatched financial security and excellent claims service—we now have more than 680 adjusters servicing our

SUMMER 2010 |

| 13


|Farmers Continued from page 13

Mutual Hail Insurance Company of Iowa

writing area. Our field force consists of 56 field supervisors who are supported by almost 250 home office employees. The growth triggered a move to a new office in West Des Moines in 2005. FMH is led by Steve Rutledge, President and CEO, and a seven-person Board of Directors. In 2009, a Management Committee was also formed to manage the day-to-day operations of the company. Recently our industry has been negotiating with the Risk Management Agency (RMA) the financial terms and regulatory requirements for all the companies participating in the Federal Crop Insurance Program. The third draft of this agreement, called the Standard Reinsurance Agreement (SRA), was released on June 10, 2010, after many months of negotiating. The third draft divides the country into three state groupings. 1 contains Project1:Layout 1 Group 6/24/10 1:33 PM IA, IL, IN, MN, and NE (essentially the

Corn Belt states). Group 3 contains AK, CT, DE, HI, ME, MA, MD, NV, NH, NJ, NY, PA, RI, UT, VT, WV, and WY. Group 2 contains all other states. Each of these groups is treated differently regarding how much of any profit or loss is taken by the government and how much remains with the company. The most significant changes in the third draft of the SRA were made to the A & O terms (Administrative and Operating Subsidy) to cover the companies’ operating expenses including agent commission and adjusting expenses. The soft cap will limit agents’ commissions to 80% of the A & O reimbursements that the government pays the AIPs (approved insurance providers) who in turn use that to pay commissions and expenses. The biggest surprise of all in the third draft was the introduction of a “hard cap” on agent commission. Agents cannot Page 1 be guaranteed more than 80%, but can

Success starts with a strong foundation!

receive up to 100% of the total A & O reimbursement if the companies are profitable (determining profitability of an AIP is yet to be fully disclosed), and the total paid out by all AIPs doesn’t exceed the maximum amount established by RMA. If this occurs AIPs will have to reduce agent’s commissions even further. All AIPs met with RMA in Kansas City on June 18, 2010, to ask questions about the third draft of the SRA—we are currently waiting to hear the results of this meeting. This agreement may change the future of the crop insurance industry, yet Farmers Mutual Hail will continue to provide peace of mind and risk-management plans for Midwest farmers.

Your Agency Integrity Stabil St ability ity

Iowa Mutual Insurance Company’s core values are the foundation you need to support your agency and differentiate yourself from the competition. Iowa Mutual’s district sales managers have commercial lines field underwriting authority and product knowledge to help you quickly write more quality business. Our commercial expertise comes from more than a century of providing a wide variety of innovative products. We also offer a co-op advertising program to help increase your agency’s visibility.

Building a strong business foundation! Contact Drew Bright, senior vice president, Marketing and Underwriting, at 800-456-5259; Iowa Mutual Insurance Company, 509 9th Street, DeWitt, Iowa 52742; or at drew.bright@iowamutual.com.

14 |

| SUMMER 2010

Teamwork Qualit Qu alityy

Superior Supe rior Ser Service vice


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thesilverlining.com


GUIDEONE INSURANCE}

|

GuideOne Insurance: Founded in 1947 in Des Moines, Iowa, and was the nation’s first auto insurance company for non-drinkers.

GuideOne company meeting.

|guideonewas founded Insurance

in 1947 in Des Moines, Iowa, and was the nation’s first auto insurance company for non-drinkers. While today, GuideOne has grown to insure all types of policyholders, we still focus on niche markets and are one of the nation’s leading insurer of churches, insuring more than 43,000 religious organizations and more than 134,000 auto and home policyholders. In addition, GuideOne insures senior living communities, private schools and colleges, and has just launched a new home care

product. We believe that agents are the best way to provide these niche markets with personal service and expertise. Headquartered in West Des Moines, Iowa, GuideOne has five branch office locations and employees 750 people. We serve a network of more than 1,500 agencies, with a mix of both career and independent agents and are licensed to do business in all 50 states. We are proud of the hard work our agents do each day, and despite a hard few years for the industry with very soft market conditions, we are proud to say that we had a finan-

“We serve a network of more than 1,500 agencies, with a mix of both career and independent agents and are licensed to do business in all 50 states.”

SUMMER 2010 |

| 17


|guideoneContinued from page 17 Insurance

cially strong 2009, with net income of $44.6 million and $505.7 million in direct written premium and surplus of $459 million. GuideOne recently was upgraded to an “A” Excellent rating by A.M. Best, underscoring our financial strength.

New Products There have been many exciting changes taking place in both lines of business, all of which are geared to make the products more marketable for agents and more attractive to policyholders. In 2009, GuideOne began rolling out multivariate pricing to both lines of business. Over 30 new pricing tiers have been added to ensure that the most accurate price is being assigned to each risk and policyholders are receiving the best price up front. While this type of pricing model has been used in personal lines for many years, GuideOne is the first insurer to launch this system in the church niche.

Over time, this will improve our loss ratios and competiveness in the marketplace. On the commercial side, we recently introduced a new commercial package policy called FaithGuard Church, which included more than a dozen enhancements to our church, college/school and senior living community lines, including green upgrade coverage, violent incident coverage, fire and security alarm system upgrade, and product recall expenses coverage. Also, GuideOne launched a new home care product, specifically targeted to Medicare-certified home health care and hospice providers. The package includes an exceptional combination of property and liability coverage to give policyholders the flexibility to choose a program to fit their specific needs. Combined with our online resource, SafeChurch.com, which is the industry’s most extensive line-up of safety and security resources, our commercial portfolio provides customers will

customized coverages, superior protection and knowledgeable advice. In personal lines, we are known for our FaithGuard Auto product, which provides people of every faith with enhanced protection and special benefits. GuideOne also has added several new discounts to our personal lines policies, including claims-free renewals, new business, and empty-nester discounts, as well as discounts for customers who have multiple lines of coverage with the company. Some recent enhancements to our auto coverage include coverage for pet injuries, expanded eligibility rule on pick-up trucks and vans, and a broadened time period on coverage for new comparable replacement autos. On the homeowners side, we’ve added coverage for mortgage or rent payment benefits, as well as broadened coverage for motor vehicles used to service a residence. These new discounts and enhancements have been well received by our agencies.

Agency Automation Providing our agents with updated technology that makes their jobs easier and more efficient is a top priority for the company. We realize that automation is necessary in today’s industry and therefore, we have dedicated much time, effort and energy to our Information Technology Systems to ensure that our agents have what they need, including commercial lines raters, and personal lines raters that interface with our agent portal, GuideLink. GuideLink also provides agents with 24/7 access to quoting, claims information, online bill pay, and various resources including important forms and training information. We also support SEMCI with personal lines downloads to agency management systems, comparative rater interface and integrated report requests. Each agent has access to their own agent website. We encourage agents to keep their GuideOne-provided website current with personalized information about their agency, as well as promote it to their policyholders. These websites offer policyholders the option of online bill

18 |

| SUMMER 2010


pay, and policy and claims viewing, making them a great resource to our agents. In addition, we have a technical Help Desk that is available to answer questions and take calls regarding GuideLink features. We also have a customer service center where agents can call to get policy information. Our service center also will service agents’ customers for them, for a percentage of their commission. These are just a few of the many services we have available for our agents.

Agency Appointments in Iowa Of our agency force of more than 1,500 agents, GuideOne has 45 agencies that are located in Iowa. While we are not currently recruiting new SLC agents in the state, we are open to adding new church and personal lines agents, especially those who are interested in niche markets and its products, as well as the benefits that selling for a niche company provides. GuideOne agents must have a focus and

commitment to selling our FaithGuard products in their local communities. After we gain a foothold within the home care market, we may reevaluate our need to expand and could potentially begin recruiting new SLC agents at that time.

Social Commitment GuideOne is a socially responsible company and is a recognized leader in the fight against drinking and driving. To strengthen the company’s social mission, the GuideOne Foundation was established in 1998. As a nonprofit organization, the mission of the GuideOne Foundation is to support the same charitable organizations that churches and churchgoers support, including mission and community development organizations, immediate need assistance, and drinking and driving and underage drinking prevention. While GuideOne no longer requires agents to sign a non-drinkers policy, we continue to believe that helping in the fight to

prevent drinking and driving, and underage drinking is an important and worthy social cause.

Commitment to Agents GuideOne is committed to its agents, and works hard every day to make sure our agency force has the tools they need to be competitive in the marketplace. These past several years have been the toughest the industry has faced, and through it all, GuideOne Insurance has prevailed. We can attribute much of this success to the hard work and dedication of our agents.

SUMMER 2010 |

| 19


Making the Ward’s 50 Benchmark Group once was good news. Making the Ward’s 50 Benchmark Group for property-casualty insurance companies for the fifth consecutive year shows that Donegal’s approach is consistently on target. The achievement recognizes that Donegal Insurance Group’s on-going commitment to safety, consistency, and strong performance provides our agents with stability they can count on. We believe having that peace of mind makes a difference.

Donegal supports the independent agent system exclusively and we are always looking for professional agents to assist in growing our market.

Call Rick Mason, Regional Vice President

800-545-6480 www.lemm.com


Midwest family mutual}

|

Treating our Agents as “Customers” since 1891

Midwest Family Mutual Insurance Company.

|GrowingIowa I up in

have always remembered the advertising slogan for the Iowa/Des Moines National Bank that existed in the 60’s and 70’s until merging with Norwest (now Wells Fargo). Their slogan was “Iowa/ D es Moines National Bank—where you are a very real person not just an account number.” This slogan very much describes our Company and how we feel about our Agents. At Midwest Family you are NOT our partner. You are our CUSTOMER! There is a subtle difference

about being treated as a customer. We work hard at meeting YOUR expectations as our primary mission. And we know if we meet your expectations we will better serve your/our insured’s. Just for the record, Hy-Vee’s “helpful smile in every aisle” also does a good job of describing Midwest Family. We have a lot of Iowa culture and influence in our Company and this Iowa influence serves us well. Our Iowa business plan calls for an Agent in every County Seat town of Iowa and any other County Seat “similar” town in Iowa. Larger cities like Des Moines and

“Our Iowa business plan calls for an Agent in every County Seat town of Iowa and any other County Seat “similar” town in Iowa.”

SUMMER 2010 |

| 21


|MIDWEST Continued from page 21

Family Mutual Insurance Company

Cedar Rapids will have multiple Agents but no more than 3-5 Agencies. It is our strong belief in giving our Agencies a degree of exclusiveness. As long as one Agency can give us our expected Market Share for their sales area we will not appoint more representation. Our target agency for a community is the BEST Agency in the town. To us, “best” is described as large enough to service customers with a healthy sales culture. We look for Agencies who love to sell insurance. Currently we have about 75% of our Agency force appointed. That means roughly 20% of the State is not geographically represented. Call Aaron Boyd at 1-800-225-5636 extension: 7027 if you have interest in Midwest Family. We still have a contingency agreement with no plans to discontinue it. Our plan begins paying at $300K of written

22 |

| SUMMER 2010

premium and is a very simple loss ratio based formula. With higher written premium volumes the percentage payout grows. Our contingency plan gives you a flavor for our premium requirements. At $300K our relationship is large enough for you to earn contingency dollars and we find from experience that when this volume level has been achieved growth naturally continues. Our underwriting philosophy is to approach our business in a way that helps you write business. Our Underwriters and Marketing people work as a team to look for ways to write business. We work hard to find ways to get to YES, as opposed to looking for ways to get to NO. Our Marketing people have Underwriting authority and as such are very much “value add” to help you grow your sales opportunities. Our delivery of New Business Commercial proposals

can be done in hours not days, weeks, or months. We work to a meet your “need by” date and we know expediency will sell more insurance. Our professional proposal process puts you in a better position to deliver proposals with much more than quoted premium. Our service standard requires all our work to leave our office in no more than one week. Most work goes in 2-3 days and this includes all transactions. Our Agent’s Service Center works closely with Agency sales and service people to respond to any agency service need. Edge is our Agent’s portal to sell and service business with Midwest Family. It is a web-based system that is accessed through your browser, and Agents and MFM employees work on this SAME platform. Our agents find Edge to be an advantage to conducting business with us. “You see what we see!” Now Personal


Lines is up and running on Edge with Personal Lines quoting, New business and endorsement quoting and issuance. Commercial Lines will follow for Edge in 3-4 months. All of our employees work from home and as such we rent 5000 square feet in Plymouth, MN that we affectionately refer to as “the Motel.” Our Plymouth office is used for meetings and conferences with Agents. Our employees are not concentrated in Minnesota. Currently we have a staff of 9 people who are Iowans serving Iowans allowing us to get closer to our customer from a sales and service perspective. Midwest Family writes a wide array of Commercial and Personal Lines business. All of our products are based on a principal of wide classes of business and broad coverage but simple in delivery and sales and service execution. We extensively use technology to support

our process but we strongly believe in people and relationships as our primary method of executing our business model. Our Marketing and Underwriting people are charged with developing this strong relationship. And our people have the authority to execute this quality relationship. We invest in people and technology to better service our Agents. We do not invest in “brick and mortar.” Our claims service receives rave reviews from our Agents. We have a network of MFM field staff adjustors who work closely with desk claims examiners to provide exemplary service. If you ever have a major wind or hail storm with Midwest Family you WILL notice the difference. Minnesota Farmers Hail Insurance Company was organized in April 1891, in Montevideo, Minnesota as a cooperative association for the purpose of writing crop

insurance for farmers. Initial operations were limited to the west central area of Minnesota, but quickly expanded to include much of southern Minnesota and northern Iowa. In 1896, the Company moved its base to Minneapolis and broadened its writings to include windstorm insurance for farm buildings and related personal property. In 1904, the name was changed to Minnesota Farmers Mutual Insurance Company (MFM). During the 1970’s, Minnesota Farmer’s changed its methods of operation, and product expansion. The Company began writing Homeowners, Automobile and other Personal Coverage’s. As a direct result, MFM became a multiple line property/casualty insurer. In May 1983, the Board of Directors renamed the corporation “Midwest Family Mutual Insurance Company”. It was felt that the new name more clearly

SUMMER 2010 |

| 23


|MIdWEST

Family Mutual Insurance Company Continued from page 23

depicted our product offerings and the policyholders we serve. In September 1991, the Company introduced its first commercial lines product, the Businessowners Policy. Seven new commercial products have followed, allowing the company to diversify its writings and build a stronger partnership with Independent Agents. The company now writes an extensive range of Commercial customers providing Property, Liability, Auto, Workers’ Compensation, and Umbrella coverages. Midwest Family Mutual has experienced significant geographic expansion over the years. The Company now does business in Illinois, Iowa, Minnesota, Nebraska, North Dakota, South Dakota, and Wisconsin. Other states are planned, but the Company’s vision is to service the Midwest. Midwest Family Mutual enjoys a strong reputation for quality service. Our policy issuance service and promptness of claim payments continue to exceed industry standards. MFM maintains an excellent financial position, allowing us to fulfill our promises to our customers. Our AM Best rating is A- “Excellent”. The quality of our staff and the Independent Agents who represent us add a touch of professional excellence to all we do. We are ever mindful that our success depends on our Agents’ success. Again, it is our mission to treat our Agents as our primary customer. If you are successful, we will be successful and we know that continuing to focus and respond to our Agents’ sales and service needs will assure our Company’s success. If you want to represent a Company that cares about you and your business needs, give us a call today. 1-800-CALL-MFM or 1-800-225-5636.

Just say

Relax ... we can handle your hard to place truck risks. J.M. Wilson has been saying yes to risks that are hard to place for over 85 years. Use our online tools to speed up your process or contact one of our experienced underwriters. You’ll receive a response to your submissions within 24 hours and policies within 21 days. Ask us about:

• For Hire Risks 1-100+ • Garbage Trucks • New Business Ventures

• Gas Haulers • Dump Trucks • Problem Drivers

• Hot Shots • Auto Haulers • Tough Classes

Ron Boyd CPCU President and CEO Midwest Family Mutual

85 W. Algonquin, Ste. 200, Arlington Heights, IL 60005 | (800) 241-7080 | jmwilson.com

24 |

| SUMMER 2010


/…iÀi½ÃʘœÊLÕȘiÃÃʏˆŽi ÊÊÊÊÊÓ>ÊLÕȘiÃÃo Visit us at Iowa IIA Convention September 22-23 Booth #49

And we know small business. AmTrust North America provides your clients the excellent workers’ compensation coverage they need for their small business—it’s our primary focus. We offer: Ê Ê Ê Ê

UÊ UÊ UÊ UÊ

Ê­ ÝVii˜Ì®ÊÀ>̈˜}ÊvÀœ“Ê°°Ê iÃÌ Êv>ÃÌ]ÊVœ˜Ûi˜ˆi˜Ìʜ˜ˆ˜iÊÃÞÃÌi“ÊvœÀÊÃÕL“ˆÌ̈˜}ÊLÕȘiÃà *iÀܘ>Ê>ÌÌi˜Ìˆœ˜ÊvÀœ“ÊiÝ«iÀˆi˜Vi`Ê՘`iÀÜÀˆÌiÀà ˜‡…œÕÃi]Ê«>«iÀiÃÃÊV>ˆ“ÃÊ«ÀœViÃȘ}

For more information about how you can write business with AmTrust, please call 877.528.7878 or visit www.amtrustnorthamerica.com. We’re ­Ã“®all business.SM


wellmark |BLUECROSS BLUESHIELD} Working Together to Create a Better Health Care System

Wellmark BlueCross BlueShield.

|healthmentally changed.

insurance has funda-

What we used to know as health insurance continues to change significantly—today, it represents more a contract for coverage than for insurance. The difference is more than semantic. Health insurance began in the 1930s as a way for Iowans to guard against an expensive hospital stay. Most people paid their family doctor or pediatrician directly. There were no copays and rates were generally stable. Today’s model of health coverage is designed to help pay for a wide array

26 |

| SUMMER 2010

of services in both the inpatient and outpatient settings, from prevention to treatment, and including prescription drugs. And, the actual costs for health care services have risen dramatically. Yet another source recently confirmed this

fact—the American Cancer Society released a study showing that the cost of treating cancer in the United States has nearly doubled in the past two decades. Researchers also found that the proportion of costs paid by private insurers rose from 42 to 50 percent; however, patients’

“We understand that rising health costs can make health coverage increasingly unaffordable for many Iowans”.


Where the Premium Dollar Goes 88.0¢

Payment for Health Care Services

out-of-pocket costs have steadily fallen, to eight percent, or less than one-half of what they were 20 years ago. We understand that rising health costs can make health coverage increasingly unaffordable for many Iowans. That’s why we have worked so hard on a variety of cost containment initiatives in recent years, e.g., to change health provider payment methodologies, curtail cost-shifting from public programs, and reduce our own administrative costs. Now as we prepare to implement health care reform for our policyholders—your clients—we believe we continue to be part of the solution in making health care not only accessible but affordable to Iowans.

Why Wellmark is different Wellmark is a mutual insurance company owned by its policyholders. We are not a publicly traded company, accountable to the expectations of stockholders, and we are not driven to create profits. Our focus, instead, is on Iowans and South Dakotans who choose our products. To maintain premiums as low as they can be, Wellmark targets an operating margin of 0-3 percent. And while health insurance is more expensive than ever, you might be surprised at where the money goes. From 2007-2009, (and as shown in the graphic on the upper right), 88 cents of every premium dollar went directly to hospitals, physicians and pharmacies to pay for members’ health care services (2007-2009 fully insured business). That’s already significantly higher than the levels mandated in the new health reform law. Wellmark’s administrative expenses are among the lowest in the industry, accounting for only eight cents of that dollar. That’s a far cry from the 20 and 30 percent estimates sometimes cited in the federal health reform debate. After adding in commissions and premium tax, Wellmark paid out nearly a penny more than it took in over that three year period. Our 2009 earnings from premium were even less than the three-year average, at negative 2.8 cents.

(0.9)¢

Earnings from Premium

0.6¢

8.0¢

Administrative Expense

Preparing for federal Source: Wellmark, Inc., 2007-2009 Fully Insured Business health reform Implementing the new health reform law is a big task for any insurer, and Wellmark is no exception. While there will be challenges, we expect to emerge as the same member-oriented company we are today. Our business model is not geared toward maximizing profits. Our medical expense ratio is already better than the standard outlined in the new law. We have low administrative costs, and offer excellent provider networks in Iowa and South Dakota. We are focused initially on the “nearterm” provisions of the law, i.e. those that have effective dates within the next ten months. Examples include coverage of adult children, restrictions on rescissions, development of the new Health/Human Services internet consumer information portal, coverage for preventive services, medical loss ratio reporting, and elimination of pre-existing conditions for children up to age 19. There will be cost implications associated with the many facets of health reform, especially those related to expanded coverage.

Creating a sustainable health care system To help mitigate future increases in premium costs, Wellmark is focusing considerable attention on the underlying drivers of health care costs. Our ultimate goal is to “bend the cost curve” down by reducing the annual increase in health care costs to the level of inflation. Our initial efforts are focused on:

4.3¢

Premium Tax

Commissions

• The proliferation of expensive medical technology • Unnecessary use of the emergency room for non-emergent care • The higher costs that are incurred when our members seek care from out-of-state providers • Reducing childhood obesity, to ensure the next generation of Iowans is healthier than their parents

Working with agents, providers and members, we believe we can reduce the cost of health care and improve Iowans health. It will not be easy, but as an insurer headquartered in Iowa, we believe it’s the right thing to do.

The role of the independent agent As trusted counselors, independent agents play a unique role in maintaining the health, welfare and financial stability of their clients. Wellmark is committed to strengthening our relationship with you, as well as collaborating with you to preserve that unique role you play in the lives of your clients. Wellmark’s employees are working every day to create a better health care system that improves the quality of the care your clients receive, and is more efficient, as well as more affordable. And we look forward to working with you each day to make that a reality.

SUMMER 2010 |

| 27


I used to think EMC was ju st for niche commercial programs. Then again, I used to think that chocolate milk came

from brown cows.

MAKE EMC YOUR CHOICE FOR MAIN STREET BUSINESS When you think main street business, start thinking about the EMC Choice® Businessowners Program. Small and midsize businesses will enjoy the flexible coverage options designed to meet their specific insurance needs, the added value of free loss control services, plus the responsive service from an EMC branch office nearby. So if you still think EMC is just for niche programs, think again. Count on EMC ® for your main street commercial lines marketing, too. For more details, contact your local EMC branch office.

Des Moines Office: 800.362.2227 | Home Office: Des Moines, IA

www.emcinsurance.com

© Copyright Employers Mutual Casualty Company 2009 All rights reserved


Š 2008 SECURA Insurance

Success is finding an advantage. If you want to win, you have to come prepared. Agents know this. That’s why so many choose SECURA to grow their business. Please call us at 1-800-558-3405. Write your own success story.


WISCONSIN PROFESSIONAL AGENT Trim: 7.75" x 10.25" Bleed: None Live: NA

.

Laptop. Appointments. Self-Assurance. Society It’s what you need to do business.

s all the difference. In any business, having the right equipment make is better equipped dy nobo And when it comes to business insurance, isn’t just our ance insur ess than Society® Insurance. You see, busin offer truly can we why s core business; it’s our only business. That’ es and servic alized speci ty unique solutions that provide high-quali ior super us gives that focus fully comprehensive coverage. It’s this the of ding rstan unde ugh expertise, not to mention a more thoro insurance companies intricacies of your clients’ businesses that other an insurance with ess busin just don’t have. So, if you’d rather do website. our visit or ty company that’s all business, call Socie

150 Camelot Dr ive P.O. Box 1029 Fond du Lac, W I 54936 888-5-SOCIET Y (888-576-243 8) societyinsurance .com

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4/30/09 3:46:52 PM


2010 Independent Insurance Agents of Iowa Scholarship Winners

Marcus Treimer Bill & Patty Treimer Treimer’s Insurance Agency Hartley, Iowa

Alaina Templeton Phil & Jayne Templeton Miltner Insurance Corning, Iowa

Megan Nielsen Scott & Kelly Nielsen Buechel Insurance Agency Hiawatha, Iowa

Megan Lightfoot Robert & Kathy Lightfoot Wilson Insurance Agency Shenandoah, Iowa

Wesley Anderson Douglas & Doreen Anderson L B Anderson Insurance Agency Newhall, Iowa

Jordan Porter Chris & Rhonda Porter Porter Insurance Agency Eldridge, Iowa

Selection Committee – Kent Hollrah, Larry Peyton, Steve Brown & Ted Lussem SUMMER 2010 |

| 35


furnishing mvrs…}

|

Legal But Not Permitted

|whenrequests an agency to run a commercial lines client

an MVR on a new employee in conjunction with adding him/her as a driver to the BAP, the agency may be able to do so without the written permission of the employee. That is, under the FCRA, Section 604, it’s legal if necessary to “the underwriting of insurance.” However, that doesn’t mean you can do it. Commercial insureds in the process of hiring employees who will be driving company vehicles routinely contact their insurance agent to have the drivers added to the Business Auto Policy. Typically, the commercial insured will provide the agency with the new employee’s driver’s license number, so that the agency can run an MVR. Some agencies have the practice of faxing the employer a copy of the MVR, especially in situations where the employee’s driving record does not meet the underwritting guidelines of the Business Auto Policy. In other instances, the agency might call the employer to discuss problems with the MVR. It’s legal. The Federal Fair Credit Reporting Act (FCRA), which applies to all “consumer reports,” including MVRs, CLUE reports, credit scores, and many other types of information on individuals, has very strict guidelines on what is “legal” regarding the use of such reports. Under the FCRA, an employer is well within their rights to require that a current or prospective employee provide or make available a wide variety of personal information such as an MVR, credit report, criminal background report, etc. At the same time, the employee is granted significant safeguards regarding the access and use of such information for employment.

When any consumer report will be used for employment, the employee or prospective employee must first give written permission for such information to be obtained by the employer. When the employer requests this information from a “consumer reporting agency” such as Equifax, Experian, TransUnion, ChoicePoint, etc., there are certain federally-mandated documents and procedures which must accompany the transaction between the CRA and the employer. For a detailed report on this, see the Federal Trade Commission (FTC) Report, “Using Consumer Reports: What Employers Need To Know,” available on the FTC website - www.ftc.gov.

“Under the FCRA Section 604, it’s legal if necessary to “the underwriting of insurance.” However, that doesn’t mean you can do it.

An insurance agency that pulls an MVR in conjunction with “the underwriting of insurance,” as prescribed in the FCRA, Section 604, does not need written permisison. Therefore, when the commercial insured/employer sends a request to the agency to pull the MVR on a new employee in conjunction with adding the employee as a driver under the Business Auto Policy, the agency can do so without the written permission of the new

employee. In addition, to inform a commercial insured that a new driver does or does not qualify as a driver for underwriting purposes seems to be a part of “the underwriting of insurance.” However, most experts believe that if the agency shares the specific contents of an MVR with the employer, via fax or phone, the agency is no longer “underwriting insurance,” but is now acting

SUMMER 2010 |

| 37


|furnishing mvrs Continued from page 37 … Legal But Not Permitted

as a “consumer reporting agency,” and must follow all the steps and procedures required under the FCRA. Therefore, if the agency chooses to furnish MVRs to commercial insureds on their current or prospective employees, they may legally do so, if they follow all the requirements of a “consumer reporting agency” under the FCRA. Thus, the procedure can be “legal.” But it’s not permitted. While the practice of an insurance agency furnishing MVRs to commercial insureds on their current or new employees can be “legal” under the FCRA, virtually all sources from whom the agency obtains the MVRs

MVR Company B: “All reports, whether oral or written, will be kept strictly confidential; except as provided by law, no information from reports will be revealed to any person except the subject of the report. No information will be requested for the use of any other person, agency or organization except with the written permission of Company B. Reports may not be resold or transferred to any other person. The unlawful ordering or use of consumer reports can subject you to criminal and civil penalties in accordance with both federal and state laws.”

“Legal experts recommend that agencies include such a privacy guideline in their employee handbook, or agency operations manual.”

expressly prohibit the practice. Following are excerpts from the contracts of two MVR providers that many insurance agencies use.

MVR company A: “The Consumer Reports provided by Company A are for the sole and internal use of the Insurance Agency, and may not be resold, sub-licensed, delivered or displayed in any way or used by any third party. Insurance Agency certifies that it shall order, receive, disseminate and otherwise use the Consumer Reports in compliance with all applicable federal, state and local statutes, rules, codes and regulations. Insurance Agency agrees to indemnify and hold harmless Company A from any and all damages, costs, judgments and expenses.”

38 |

| SUMMER 2010

Recently, one of the largest MVR Companies in the nation sent this memo to all insurance agency customers: “It has recently come to our attention that some insurance agencies may be furnishing MVRs obtained for commercial underwriting purposes to the commercial insurance buying customer.” “Please be aware that the consumer reports you obtain from us may not be used beyond the purpose for which they were ordered and cannot be sold or given to parties outside the ordering insurance company or insurance agency.” “Allowing an employer to receive an MVR that was provided to you for commmercial underwriting purposes would be a violation of law as well as a violation of your agreement with us.” Thus, the practice of an insurance agency furnishing MVRs to commercial insureds on their current or pospective

employees is not permitted by most MVR providers, although the practice can be “legal” under the FCRA. Legal experts caution insurance agencies about getting involved in employee screening on behalf of their commercial insureds. As employers, commercial insureds not only have a right to conduct background checks on employees; in today’s legal climate, they almost certainly also have a duty to do so. However, there are countless employee screening services that can conduct proper, legal and permissible background checks on employees. Agencies should refer their commercial insureds to these screening services. It is imperative that agencies distinguish between “insurance underwritting” functions and those which cross the line into “employee screening” activities. While agencies obtain MVRs and other consumer reports as a part of underwriting, there must be clear guidelines limiting their disclosure for any other purpose. Legal experts recommend that agencies include such a privacy guideline in their employee handbook, or agency operations manual. Source: Mike Edwards, IIABA Virtual University faculty member.


2009 Data Shows Iowa Independent Agents Outperform the Competition By Bob skow, cpcU, cae chief executive officer

E

ach year IIAI features in Iowa Independent Agents Viewpoint Magazine the data supplied by A.M. Best for Iowa Property and Casualty companies market share, and loss ratio information. 2009 data shows a significant increase in loss ratios. It also shows Iowa independent agents are outperforming other delivery systems. Both regional and national companies utilizing independent agents as its distribution system grew for the 8th year in a row. The data supplied by A.M. Best is submitted by insurers for the prior calendar year. Three top 20 carriers American Family Insurance Group, Cincinnati Insurance Company and Zurich Financial Services of North America witnessed a drop in premium dollars written while the other 17 increased premium dollars written. The most significant growth was recorded by ACE INA Group. While State Farm leads the way in Personal Lines business collectively independent agents write more private passenger auto, but direct marketers outperform independent agent companies in Iowa’s Homeowners market. Commercial Lines remains the strong suit for the American Agency System. Direct Writers on average write less than 1 out of 5 Iowa risks. 2009 Data Shows Iowa Independent Agents Out Perform the Competition.


2009 Data

U.S. Property/Casualty - Product Line Underwriting Trends (2005-2010P) Net Premiums Written Combined Ratio

2009 Actual Estimates

Product Line1 Share Growth

2005

2006

2007

2008

Private Passenger Auto

37.90%

0.50%

95.1

95.5

98.3

100.3

Homeowners & Farmowners Multi Peril

14.00%

3.00%

100.1

89.4

95.7

117

2009E* 99.3

2010P** 98.5

105.5

105

Other & Products Liability2

9.90%

-6.00%

113.1

95.3

99

95.1

100

102

Workers’ Compensation

8.10%

-13.00%

102.7

98.4

103.5

104.3

109

112

Commercial Multiple Peril

6.40%

-4.00%

97.1

93

91.9

103.9

97

99.5

Commercial Auto

5.50%

-9.50%

92.1

92.4

94.2

96.8

97

98.5

Fire & Allied Lines

4.80%

-7.00%

104.1

79.7

69.9

99.2

81.5

89

Inland Marine

2.10%

-8.00%

89.8

77.2

79.5

93.2

86

88.5

3

Medical Professional Liability

2.10%

-5.00%

All Other Lines4

9.90%

-10.00%

Total All Lines

100.00%

-4.20%

101.1

91.2

84.3

77.5

84.5

94

119

86.3

96.5

123.7

107.9

111.5

101.2

92.40

95.5

105.10

100.60

101.70

E* = Estimated P** = Projected Source: Best’s Statement File Supplement - Insurance Expense Exhibit (IEE) - P/C, US (2005-2008)

1

Other Liability Includes Professional Liability, Directors and Officers, Excess Casualty/Umbrella, Environmental/Pollution, General

2

Liability and Employment Practices Liability. Fire & Allied Lines includes Earthquake, Multiple Peril Crop and Federal Flood.

3

All Other Lines includes Accident and Health Lines, Mortgage Guaranty, Financial Guaranty, Ocean Marine, Aircraft, Fidelity, Surety,

4

Burglary and Theft, Boiler and Machinery, Credit, International, Excess-of-Loss, Reinsurance and Miscellaneous. Source: A.M. Best Co.

40 |

|SUMMER 2010


2009 Data

Iowa – Overall State Ranking (All P/C Lines)

(Direct Writers Highlighted)

2009 2008 2009 2008 2009 2008 Market Market Direct Written Direct Written Adjusted Adjusted Name Share Share Difference Premiums (000) Premiums (000) Difference Loss Ratio Loss Ratio

Difference

1 State Farm Group

9.10%

9.50%

-0.40%

$473,197

$455,133

$18,064.00

85.8

62.7

23.1

2 Allied Group a Nationwide Co

7.90%

8.40%

-0.50%

$411,062

$406,910

$4,152.00

77.4

52.4

25

3 Farm Bureau Mutual Group

6.10%

5.60%

0.50%

$313,543

$269,072

$44,471.00

92.9

44.1

48.8

4 ACE INA Group

4.40%

3.40%

1.00%

$226,072

$163,034

$63,038.00

43.4

12.7

30.7

5 Progressive Group

3.30%

3.40%

-0.10%

$173,052

$164,749

$8,303.00

65.8

58.4

7.4

6 Farmers Mutual Hail Insurance Grp

3.20%

2.40%

0.80%

$167,512

$114,472

$53,040.00

99.8

14.7

85.1

7 EMC Ins Cos

3.20%

3.40%

-0.20%

$166,333

$162,074

$4,259.00

82.7

45.7

37

8 American Family Insurance Group

3.20%

3.60%

-0.40%

$165,618

$173,025

$(7,407.00) 74.1

53.4

20.7

9 American Intl Group Inc.

3.10%

3.20%

-0.10%

$160,721

$153,861

$6,860.00

60.3

52.6

7.7

10 St Paul Travelers

2.70%

2.60%

0.10%

$140,580

$124,928

$15,652.00

90.4

64.1

26.3

11 Liberty Mutual Insurance Cos

2.50%

2.30%

0.20%

$127,412

$108,499

$18,913.00

66.9

52.7

14.2

12 Grinnell Mutual Grp

2.10%

2.20%

-0.10%

$109,717

$107,617

$2,100.00

60

45.9

14.1

13 NAU Country Ins

2.10%

1.60%

0.50%

$109,694

$76,014

$33,680.00

85.2

22.6

62.6

14 Great American P&C Group

2.10%

1.60%

0.50%

$107,609

$76,213

$31,396.00 101.5

26

75.5

15 Centurion Ins Grp

1.80%

1.20%

0.60%

$94,702

$58,129

$36,573.00

77.8

13.9

63.9

16 Cincinnati Ins Cos

1.70%

1.80%

-0.10%

$87,521

$88,045

$(524.00) 81.3

54.1

27.2

17 Auto-Owners Insurance Grp

1.70%

1.80%

-0.10%

$87,000

$86,336

48.1

30.7

18 Zurich Fin Serv NA

1.60%

1.90%

-0.30%

$84,965

$92,114

51

34.7

19 IMT Insurance Company Mut

1.50%

1.60%

-0.10%

$79,189

$77,768

$1,421.00

42.9

40.1

2.8

20 West Bend

1.40%

1.40%

0.00%

$70,426

$66,118

$4,308.00

58.4

53.4

5

64.70%

62.90%

1.80%

$3,355,925

$3,024,111

$331,814.00

75.56

43.43

32.13

0%

$5,177,459

$4,815,689

$361,770.00

81.8

47.4

34.4

Top 20 Totals

$664.00

78.8

$(7,149.00) 85.7

All Carriers State Totals

100%

100%

SUMMER 2010 |

| 41


2009 dATA

Iowa – Regional Independent Agency Companies 2009 Direct Written premiums (000)

name

2009 market share

2008 market share

Difference

2009 adjusted loss Ratio

2008 adjusted loss Ratio

Difference 25

1

Allied group a Nationwide Co

$411,062

7.90%

8.40%

-0.50%

77.4

52.4

2

Progressive group

$173,052

3.30%

3.40%

-0.10%

65.8

58.4

7.4

3

Farmers Mutual Hail Ins group

$167,512

3.20%

2.40%

0.80%

99.8

14.7

85.1

4

EMC Insurance Companies

$166,333

3.20%

3.40%

-0.20%

82.7

45.7

37

5

grinnell Mutual

$109,717

2.10%

2.20%

-0.10%

60

45.9

14.1

6

NAU Country Insurance

$109,694

2.10%

1.60%

0.50%

85.2

22.6

62.6

7

Auto-Owners Insurance group

$87,000

1.70%

1.80%

-0.10%

78.8

48.1

30.7

8

IMT Insurance Company Mutual

$79,189

1.50%

1.60%

-0.10%

42.9

40.1

2.8

9

West Bend Mutual group

$70,426

1.40%

1.40%

0.00%

58.4

53.4

5

Westfield group

$68,847

1.30%

1.10%

0.20%

63.5

44.1

19.4

top 10 totals

$1,442,832

27.70%

27.30%

0.40%

71.45

42.54

28.91

all carriers state total

$2,155,340

41.60%

42.40%

-0.80%

78.84

47.61

31.23

10

2009 STATE MARKET SHARE Direct Writers 33% Regional Agency Companies 41.6% REGIONAL AGENCY COMPANIES

National Agency Companies 25.4%

NATIONAL AGENCY COMPANIES DIRECT WRITERS

Iowa – National Independent Agency Companies 2009 Direct Written premiums (000)

name

2009 market share

2008 market share

Difference

2009 adjusted loss Ratio

2008 adjusted loss Ratio

Difference

1

ACE INA group

$226,072

4.40%

3.40%

1.00%

43.4

12.7

30.7

2

American International group Inc

$160,721

3.10%

3.20%

-0.10%

60.3

52.6

7.7

3

St. Paul Travelers

$140,580

2.70%

2.60%

0.10%

90.4

64.1

26.3

4

great American P & C group

$107,609

2.10%

1.60%

0.50%

101.5

26

75.5

5

Cincinnati Insurance

$87,521

1.70%

1.80%

-0.10%

81.3

54.1

27.2

6

Zurich Fin. Serv. NA

$84,965

1.60%

1.90%

-0.30%

85.7

51

34.7

7

Old Republic general group

$68,844

1.30%

1.70%

-0.40%

88.1

69.2

18.9

8

W R Berkley group

$66,791

1.30%

1.50%

-0.20%

66.1

41.8

24.3

9

Hartford Insurance group

$66,163

1.30%

1.50%

-0.20%

87.2

71.5

15.7

Chubb group of Insurance Cos

$64,390

1.20%

1.40%

-0.20%

156.9

33.8

123.1

top 10 totals

$1,073,656

20.70%

20.60%

0.10%

86.09

47.68

38.41

all carriers state total

$1,314,499

25.40%

24.50%

0.90%

68.41

42.7

25.71

10

42 |

|SUMMER 2010


2009 Data

Iowa – Direct Writers 2009 2009 2008 2009 2008 Direct Written Market Market Adjusted Adjusted Name Premiums (000) Share Share Difference Loss Ratio Loss Ratio Difference 1 State Farm Group

$473,197

9.10%

9.50% -0.40%

85.8

62.7

23.1

2 Farm Bureau Mutual Group

$313,543

6.10%

5.60%

0.50%

92.9

44.1

48.8

3 American Family Insurance Group

$165,618

3.20%

3.60% -0.40%

74.1

53.4

20.7

4 Liberty Mutual Insurance Cos

$127,412

2.50%

2.30%

0.20%

66.9

52.7

14.2

5 Centurion Insurance Group

$94,702

1.80%

1.20%

0.60%

77.8

13.9

63.9

6 PMI Mortgage Group

$61,159

1.20%

1.40% -0.20%

36.5

13.6

22.9

7 Allstate Insurance Group

$58,878

1.10%

1.30% -0.20%

59.2

44.8

14.4

8 Farmers Insurance Group

$53,877

1.00%

1.10% -0.10%

63.5

52.2

11.3

9 Berkshire Hathaway

$37,168

0.70%

0.70%

59.5

42.6

16.9

10 Sentry Insurance Group

$30,456

0.60%

0.70% -0.10%

75

49.4

25.6

0.00%

Top 10 Totals

$1,416,010

27.30% 27.40% -0.10%

69.12

18.13

50.99

All Carriers State Total

$1,707,620

33.00% 33.10% -0.10%

111.82

53.98

57.84

Congratulations 2010 President’s Club!

S

ince 1909, Grinnell Mutual has prospered by building strong relationships with quality farm PXWXDOVDQGDJHQFLHV7KHIROORZLQJDJHQFLHVKDYHFRQWULEXWHGVLJQLÀFDQWO\WRRXUFRPELQHG success and have been named to the 2010 Grinnell Mutual President’s Club. We appreciate their FRQWULEXWLRQVDQGHQMR\WKHPXWXDOEHQHÀWVRIRXU3ROLF\RI:RUNLQJ7RJHWKHU 1st Insurance Services Waverly, IA A & J Petersburg Agency Decorah, IA Abens-Marty-Curran Agency Humboldt, IA Associated Insurance Counselors Preston, IA Axman Insurance Agency Pomeroy, IA Black Hawk Insurance Services Hudson, IA Bob Dodds Insurance Agency Danville, IA Clay Agency Spencer, IA Cook Agency, Inc. Waukon, IA

Denver Insurance & Real Estate Denver, IA EGR Insurance, Inc. Moville, IA Eland Agency, Inc. Mediapolis, IA )LUVW0D[¿HOG5HVRXUFHV+ROGLQJ&R Denver, IA FMD Agency, Inc. Schleswig, IA Hochstedler Insurance Agency Kalona, IA Insurance Headquarters, Inc. Readlyn, IA Jaspersen Insurance & Real Estate Thornton, IA Lenz Insurance & Real Estate, Inc. Breda, IA

LSB Insurance Reinbeck, IA Bank Midwest Insurance Services Spirit Lake, IA Mutual Services Agency, Inc. Red Oak, IA R W Larson Insurance Agency Boone, IA Sibley Insurance Agency/Hertz Ins. Sibley, IA Smith Insurance, LLC Lamont, IA Tenold Olsen Hagen, Inc. Northwood, IA Town & Country Insurance Agency Osage, IA West Side Agency, Inc. Palo, IA

grinnellmutual.com

SUMMER 2010 |

| 43


2009 dATA

Iowa – Private Passenger Auto Physical Damage

(Direct Writers Highlighted)

name

2009 Direct Written premiums (000)

2009 market share

2008 market share

1

State Farm group

$127,898

21.20%

21.00%

2

Allied group a Nationwide Co

$76,964

12.70%

13.00%

3

Progressive group

$70,089

11.60%

11.10%

4

American Family Insurance group

$47,122

7.80%

8.30%

5

Farm Bureau Mutual group

$42,458

7.00%

6.90%

0.10%

6

grinnell Mutual group

$31,201

5.20%

5.10%

0.10%

7

Allstate Insurance group

$21,238

3.50%

3.70%

-0.20%

8

IMT Insurance Company Mutual

$19,693

3.30%

3.20%

0.10%

9

Auto-Owners Insurance group

$13,477

2.20%

2.10%

0.10%

61.1

51.2

9.9

Pekin Insurance group

$12,012

2.00%

2.10%

-0.10%

64.1

52.2

11.9

total from top 10 writers

$462,152

76.50%

76.50%

0.00%

61.46

53.40

(avg.)

(avg.)

10

2009 adjusted loss Ratio

2008 adjusted loss Ratio

0.20%

73.8

69.5

4.3

-0.30%

55.2

49.5

5.7

0.50%

70.8

64

6.8

-0.50%

60.3

51.1

9.2

70.1

56.5

13.6

66

56.6

9.4

40.4

37.8

2.6

52.8

45.6

7.2

Difference

$389,350

state total For all carriers combined

Independent Agents 78.20%

64.9

56.9

INDEPENDENT AGENTS

Iowa – Other Private Passenger Auto (Liability) name

8.06 8

2009 IOWA PRIVATE PASSENGER AUTO MARKET

Direct Writers 21.80%

2009 2009 Direct Written market premiums (000) share

Difference

2008 market share

DIRECT WRITERS

(Direct Writers Highlighted)

Difference

2009 adjusted loss Ratio

2008 adjusted loss Ratio

Difference

1

State Farm group

$80,542

20.40%

19.90%

0.50%

69.3

69.6

-0.3

2

Progressive group

$84,843

13.00%

12.40%

0.60%

64.9

57.5

7.4

3

Allied group a Nationwide Co

$82,818

12.70%

12.60%

0.10%

50.8

57.5

-6.7

4

American Family Insurance group

$49,962

7.60%

8.30%

-0.70%

63.6

60.2

3.4

5

Farm Bureau Mutual group

$49,540

7.60%

7.70%

-0.10%

57.3

46.9

10.4

6

grinnell Mutual group

$30,413

4.60%

4.60%

0.00%

68.9

55.5

13.4

7

IMT Insurance Company Mutual

$19,051

2.90%

2.80%

0.10%

39.8

46.1

-6.3

8

Farmers Insurance group

$17,148

2.60%

2.70%

-0.10%

44.2

55.6

-11.4

9

Allstate Insurance group

$16,516

2.50%

2.60%

-0.10%

42.1

66.6

-24.5

Pekin

$11,452

1.70%

1.90%

-0.20%

77.3

58.9

18.4

$442,285

75.60%

75.50%

0.10%

57.82

57.44

(avg.)

(avg.)

10

total from top 10 writers state total For all carriers combined

$654,415

Independent Agents 48.9%

61

Direct Writers 51.1%

59.4

0.38 1.6

2009 IOWA OTHER PRIVATE PASSENGER AUTO MARKET INDEPENDENT AGENTS

DIRECT WRITERS

SUMMER 2010 |

| 45


2009 dATA

Iowa – Homeowners Multi-Peril

(Direct Writers Highlighted)

name

2009 Direct Written premiums (000)

2009 market share

2008 market share

1

State Farm group

$124,773

25.80%

25.00%

0.80%

2

Allied group a Nationwide Co

$83,733

17.30%

17.50%

-0.20%

3

American Family Insurance group

$39,864

8.30%

8.80%

-0.50%

81.2

45.1

36.1

4

Farm Bureau Mutual group

$33,985

7.00%

6.80%

0.20%

107.3

57.2

50.1

5

Auto-Owners Insurance group

$17,607

3.60%

3.80%

-0.20%

97.8

53.3

44.5

6

Allstate Insurance group

$16,436

3.40%

3.60%

-0.20%

72.5

27.8

44.7

7

Farmers Insurance group

$16,382

3.40%

3.30%

0.10%

68.7

46.9

21.8

8

Pekin Insurance group

$13,893

2.90%

3.10%

-0.20%

71.7

64.3

7.4

9

IMT Insurance Company Mutual

$13,734

2.80%

2.90%

-0.10%

56.7

38.7

18

EMC Insurance Companies

$11,009

2.30%

2.40%

-0.10%

139.4

45.5

93.9

$371,416

76.80%

48.86

41.11

10

total from top 10 writers

Difference

77.20% -0.40%

Difference

105

53.5

51.5

56.3

43.1

99.4

89.97 94.9

(avg.)

50.9

44

2009 IOWA HOMEOWNERS MARKET

Direct Writers 56.1%

Independent Agents 43.9%

2008 adjusted loss Ratio

(avg.)

$482,201

state total For all carriers combined

2009 adjusted loss Ratio

INDEPENDENT AGENTS

Iowa – Inland Marine

DIRECT WRITERS

(Direct Writers Highlighted)

2009 2009 Direct Written market premiums (000) share

name

2008 market share

Difference

2009 adjusted loss Ratio

2008 adjusted loss Ratio

Difference

1

Assurant Solutions

$25,273

16.00%

16.00%

0.00%

37.5

33.1

4.4

2

Hartford Insurance group

$10,967

6.90%

7.30%

-0.40%

49.3

53.4

-4.1

3

Chubb group of Insurance Cos

$9,291

5.90%

6.70%

-0.80%

35

23.9

11.1

4

State Farm group

$8,684

5.50%

5.50%

0.00%

49

38.7

10.3

5

liberty Mutual Insurance Cos

$8,501

5.40%

4.50%

0.90%

66.7

65.7

1

6

American International group Inc

$8,218

5.20%

5.20%

0.00%

56.7

106.7

-50

7

FM global group

$7,969

5.00%

3.80%

1.20%

999.9

N/A

N/A

8

Allied group a Nationwide Co

$6,851

4.30%

4.40%

-0.10%

50.8

32.5

18.3

9

St. Paul Travelers group

$6,364

4.00%

3.90%

0.10%

76.2

34.5

41.7

Old Republic

$5,338

3.40%

3.10%

0.30%

39.2

42

-2.8

$97,456

61.60%

60.40%

1.20%

146.03

10

total from top 10 writers state total For all carriers combined

$158,202

Independent Agents 78.7%

46 |

| SUMMER 2010

(avg.)

216.9 Direct Writers 21.3%

43.76 (avg.)

40.8

102.27 176.1

2009 IOWA INLAND MARINE MARKET INDEPENDENT AGENTS

DIRECT WRITERS


2009 dATA

Iowa – Commercial CGL/BOP Liability 2009 Direct Written premiums (000)

name

(Direct Writers Highlighted)

2009 market share

2008 market share

Difference

2009 adjusted loss Ratio

2008 adjusted loss Ratio

Difference

1

Allied group a Nationwide Co

$12,743

12.70%

13.30%

-0.60%

46.6

36.7

9.9

2

Cincinnati Insurance Companies

$6,974

6.90%

7.50%

-0.60%

28.9

-82.4

111.3

3

St Paul Travelers

$6,663

6.60%

6.40%

0.20%

97.3

20.3

77

4

W R Berkley group

$6,474

6.40%

6.90%

-0.50%

100.5

16.8

83.7

5

general Casualty (QBE)

$5,164

5.10%

5.60%

-0.50%

-36.2

20.3

-56.5

6

Auto-Owners Insurance group

$4,871

4.90%

5.20%

-0.30%

36.2

0.7

35.5

7

State Farm group

$4,532

4.50%

3.30%

1.20%

172.3

111.2

61.1

8

grinnell Mutual group

$3,322

3.30%

3.30%

0.00%

33.7

29.1

4.6

9

liberty Mutual Insurance Cos

$3,068

3.10%

2.00%

1.10%

58.7

48.7

10

Tokio Marine US grp

$2,927

2.90%

0.00%

2.90%

21.8

-8.3

30.1

$56,738

56.40%

53.50%

2.90%

19.31

36.67

10

total from top 10 writers

$100,379

state total For all carriers combined

Independent Agents 82.10%

55.98 (avg.)

47.3

23

24.3

2009 IOWA COMMERCIAL CGL/BOP LIABILITY

Direct Writers 17.9%

INDEPENDENT AGENTS

Iowa – Workers’ Compensation

DIRECT WRITERS

(Direct Writers Highlighted)

2009 2009 Direct Written market premiums (000) share

name

(avg.)

2008 market share Difference

2009 adjusted loss Ratio

2008 adjusted loss Ratio

Difference

1

liberty Mutual Insurance Cos

$54,802

9.70%

10.00%

-0.30%

75.6

57.4

18.2

2

Accident Fund group

$50,095

8.90%

9.00%

-0.10%

81.4

57.3

24.1

3

EMC Insurance Companies

$49,485

8.80%

7.90%

0.90%

102.4

72.5

29.9

4

St. Paul Travelers

$38,108

6.80%

4.20%

2.60%

90.6

95.5

-4.9

5

Allied group a Nationwide Co

$34,422

6.10%

6.20%

-0.10%

82.8

80.4

2.4

6

Zurich Fin Serv NA

$30,761

5.50%

6.00%

-0.50%

101.8

71.4

30.4

7

Cincinnati Insurance Companies

$25,462

4.50%

4.30%

0.20%

90.2

94.7

-4.5

8

American International group Inc

$24,346

4.30%

5.90%

-1.60%

71.4

65.1

6.3

9

W R Berkley group

$18,362

3.30%

3.50%

-0.20%

76.5

69.3

7.2

United Fire & Casualty

$17,472

3.10%

2.80%

0.30%

52

25.4

26.6

$343,315

61.00%

59.80%

1.20%

82.47

68.90

13.57

10

total from top 10 writers state total For all carriers combined

(avg.)

$563,503

Independent Agents 80.2%

78.2

Direct Writers 19.8%

(avg.)

69.4

8.8

2009 IOWA WORKERS’ COMPENSATION MARKET INDEPENDENT AGENTS

DIRECT WRITERS

SUMMER 2010 |

| 47


2009 dATA

Iowa – Commerical Property 2009 Direct Written premiums (000)

name

(Direct Writers Highlighted)

2009 market share

2008 market share Difference

2009 adjusted loss Ratio

2008 adjusted loss Ratio

Difference

1

Allied group a Nationwide Co

$25,622

13.50%

13.10%

0.40%

173.9

35.7

138.2

2

State Farm group

$15,975

8.40%

8.80%

-0.40%

63.2

66.2

-3

3

Cincinnati Insurance Companies

$15,361

8.10%

7.90%

0.20%

4

Chubb group of Insurance Cos

$11,420

6.00%

6.10%

-0.10%

5

W R Berkley group

$10,020

5.30%

5.60%

-0.30%

73.7

41.4

32.3

6

St Paul Travelers

$9,842

5.20%

5.20%

0.00%

132.8

152.2

-19.4

7

Auto-Owners Insurance group

$7,740

4.10%

4.10%

0.00%

63.8

49.4

14.4

8

QBE Americas group

$6,043

3.20%

3.40%

-0.20%

93.1

27.6

65.5

9

liberty Mutual Insurance Cos

$5,293

2.80%

2.50%

0.30%

118.4

19.7

98.7

grinnell Mutual group

$5,235

2.80%

2.70%

0.10%

87.2

39.7

47.5

$112,551

59.40%

59.40%

0.00%

162.25

47.60

114.65

10

total from top 10 writers

Independent Agents 78.1%

14

117

30.1

655.3

(avg.)

$190,254

state total For all carriers combined

131 685.4

140.3

name

52.7

87.6

2009 IOWA COMMERICAL PROPERTY MARKET

Direct Writers 21.9%

INDEPENDENT AGENTS

Iowa – Other Commercial Liability 2009 Direct Written premiums (000)

(avg.)

DIRECT WRITERS

(Direct Writers Highlighted)

2009 market share

2008 market share

Difference

2009 adjusted loss Ratio

2008 adjusted loss Ratio

Difference

1

American International group Inc

$56,946

13.30%

10.80%

2.50%

53.8

64.6

-10.8

2

EMC Insurance Companies

$28,408

6.70%

6.70%

0.00%

52.9

19.9

33

3

St Paul Travelers

$25,465

6.00%

6.00%

0.00%

73.6

46.8

26.8

4

Allied group a Nationwide Co

$22,580

5.30%

5.20%

0.10%

42.7

29

13.7

5

Chubb group of Insurance Cos

$18,425

4.30%

4.50%

-0.20%

23.5

26.3

-2.8

6

Zurich Fin Serv NA

$17,241

4.00%

4.80%

-0.80%

80.1

52.7

27.4

7

grinnell Mutual group

$15,610

3.70%

3.60%

0.10%

49.6

28.8

20.8

8

Cincinnati Insurance Companies

$14,143

3.30%

3.30%

0.00%

90.1

124.3

-34.2

9

ACE INA group

$11,899

2.80%

3.00%

-0.20%

138.6

53.3

85.3

Allianz of America

$10,739

2.50%

2.80%

-0.30%

76

77.3

-1.3

51.90% 50.70%

1.20%

52.30

15.79

10

total from top 10 writers state total For all carriers combined

$221,456 $427,074

Independent Agents 85.5%

48 |

| SUMMER 2010

68.09 (avg.)

50.1

Direct Writers 14.5%

(avg.)

47.3

2.8

2009 IOWA OTHER COMMERCIAL LIABILITY MARKET INDEPENDENT AGENTS

DIRECT WRITERS


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{THE LAST PAGE} What’s Your Political Affiliation? By Bob Skow, CPCU, CAE – Chief Executive Officer

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very so often someone asks me what my political affiliation is. I respond…The Independent Insurance Agents of Iowa! Why do I answer that way? Because, one of the most important things in our lives is our ability to make a living. And, my livelihood is directly related to the success of Iowa’s insurance agents and Iowa’s insurance industry. So it is a very simple response, yet, I believe a very honest response. Today, each of you have a partner in your agencies…it is the government. Insurance has always been a heavily regulated industry and as always is in the political cross hairs. I often think of the Far Side Cartoon when I think about our business where creator Gary Larson shows two deer standing up in the woods, and the one has a bull’s-eye on his chest and the one deer says to the other “Bummer of a birthmark Hal…” Kind of like our industry! We have a giant bull’s-eye on us all. It has become politically popular to attack the insurance industry. The media calls for more regulation, politicians stand up and demagogy and way too often we don’t fight back. As a collective group we all need to tell our story; how we make people’s lives whole again after disasters and personal tragedy; how we impact the economy; and about the jobs we create, and the taxes we pay! In Iowa our industry is second only to agriculture; we do make a huge foot print on our state’s economy. That’s why we must tell our message, and spell out our positions to those seeking office.

As IIAI develops it’s political issue positions we first look at how an issue impacts the insurance buying public. We historically know that affordability of our product is key for most consumers, as affordable insurance means more people are insured and the economy is better served. Secondly, we look at how changes in law impact our business partners, the carriers.

“In Iowa our industry is second only to agriculture; we do make a huge foot print on our state’s economy”. One of the best things we can do for both agents and consumers is to create a regulatory climate that encourages carriers to want to do business in our state. We know you can be the world’s best salesperson, but if you don’t have a market for the coverage the sales ability doesn’t matter. And finally, we look at the impact on agents. Typically we know if consumers win, and carriers win, so do agents! We recently sent to all candidates for the Iowa Legislature and the candidates for Governor an issue survey. Included with this

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article is a copy of IIAI’s positions and the questions we are asking candidates to respond to this year. The responses will be shared with our membership at the end of the summer before Election Day. We hope you’ll take time to read the positions and the survey questions so you will be better prepared to communicate with those who seek office who may stop by your homes or offices as they campaign. Take time to ask them about a few of these insurance issues. If they stop at your agency take them on a

“If you like a candidate and believe they reflect your insurance views offer to help them. Allow them to put a sign in your front yard. We need friends on both sides of the aisle so please get to know your state legislators as they may well hold the key to your future.” tour and explain what you and your staff do. These little things can make a huge difference. If you like a candidate and believe they reflect your insurance views offer to help them. Allow them to put a sign in your front yard. We need friends on both sides of the aisle so please get to know your state legislators as they may well hold the key to your future. Today, more than ever, you and everyone who works in this great Iowa insurance industry must get politically engaged.

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Independent Insurance Agents of Iowa Legislative Survey E

ach election year the Independent Insurance Agents of Iowa (IIAI) mails a survey to Iowa House, Senate and Gubernatorial candidates outlining insurance related issues which may come before the Iowa legislature. IIAI members write all lines of insurance: workers’ compensation, automobile, business, farm, crop, health, home, professional liability, long-term care, and life coverage. We represent over 10,000 licensed insurance professionals, with more than 1,000 offices located in nearly every community across Iowa. The IIAI is the largest insurance association in Iowa and our national association, the Independent Insurance Agents and Brokers of America, is routinely named as one of the strongest political lobbying associations in America. Bob Skow, CPCU, CAE, and multi-client lobbyist Larry Blixt lobby on behalf of the IIAI membership at the state level. The insurance industry is one of Iowa’s strongest economic drivers. The Iowa insurance industry is directly or indirectly linked to 88,336 quality jobs in the state producing over $3.9 billion in labor income. The insurance industry generated $309.1 million in state and local taxes. Also, the industry generates superior wages to workers compared to the average Iowa industry. As a candidate for office we would like to express our appreciation of your hard work and dedication to public service. We wish you the best of luck in your upcoming election. We hope you will consider sharing your views on the issues which impact Iowa’s Consumers and Insurance Professionals. We want you to know your position is of value to us. Please take time to consider these issues carefully as each will impact the Iowa economy, and affordability of insurance. The responses to the survey will be copied as you submit them and shared with Iowa’s insurance professionals.

Issue #1 – Health Insurance

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he new federal Patient Protection and Affordable Care Act enacted on March 23, 2010, asks that states form new health insurance exchanges by January 1, 2014, or the federal government will provide access to an exchange. The state of Iowa has a reputation of being a fair insurance regulatory state. If the state of Iowa creates a health insurance exchange; it is the IIAI’s belief that the Iowa Insurance Division should be the sole regulatory authority for the insurance industry in our state and should exclusively regulate the operations of an Iowa health insurance exchange. There is a licensed independent agent in nearly every community in Iowa. These independent insurance agents represent the vast majority of Iowans when searching for all lines of insurance, including health insurance. IIAI believes the insurance agent’s role should be maintained and preserved if the state of Iowa creates a health insurance exchange. IIAI believes licensed insurance agents should be the exclusive source for Iowa consumers to access health insurance and those agents be paid compensation consistent with current industry practices. Agents are licensed and subject to mandatory testing and education requirements as well as Iowa’s unfair trade practices. Creating alternative distribution systems is unnecessary and economically unsound.


Last session, the Iowa Legislature passed a requirement that health insurance companies must pre-notify insureds of a pending rate increase. Also, they are requiring a public hearing for rate increases above the medical inflation index. IIAI is opposed to this change. We believe the Iowa Insurance Division does a very good job of reviewing rate increases and this concept is over regulation of the industry. One health insurance carrier is leaving Iowa and we believe more will follow. We believe this will lead to less competition in the insurance industry in Iowa. We ask that this law be repealed.

Issue #2 – Tort Law/Wrongful Death Law

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owa citizens enjoy some of the most competitive insurance liability rates in the country. Iowa’s current tort system was passed by the Iowa Legislature in 1983. It is viewed by plaintiffs and defendants alike to be extremely fair. Iowa’s tort climate is ranked 10th best nationally, according to the 2010 U.S. Tort Liability Index issued by the Pacific Research Institute. Hovannes Abramyan, a spokesman for the Pacific Research Institute, stated, “Job growth was 57 percent greater in the 10 states

with the best tort climates than in the 10 states with the worst tort climates.1” The IIAI suggests legislators proceed with extreme caution before making changes to Iowa negligence statutes. According to the Legislative Services Agency: Fiscal Services Division in the February 16, 2010 fiscal note, there were 48 wrongful death tort claims filed against the State between 20082010. The State of Iowa would have a fiscal impact due to liability if a State employee was the person that caused the death of the deceased. If the State is the losing party, up to $2.5 million in additional costs could be paid through the State Appeal Board for one case. This could cost the State up to $120 million (this does not take into consideration the impact on Iowa’s business and farming industries if they were to be held liable for these kinds of damages…Iowans could lose their businesses and farms if these kinds of sizable judgments were successfully brought against them). IIAI is opposed to making changes to Iowa’s death statute as presented in the last legislative session in HF 758, which provides that a spouse or child of a person may recover for the expense and actual loss of support, services, companionship, and society resulting from injury to or death of the person (damages recoverable may

include damages for a decedent’s loss of enjoyment of life, measured separate and apart from the economic productive value the decedent would have had if the decedent lived and such damage shall not be duplicative of damages recoverable in an action for the injury or death of a spouse or parent and in an action for injury or death of a child).

Issue #3 – Uninsured Motorist Coverage

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ome have suggested that it should be easier for parties to collect from insurance carriers under the Uninsured Motorist Coverage which is provided by automobile insurance. For example, if an insurance company honors a claim for a one car accident with the insured contending a “phantom” party caused the accident. This would cause: • Insurance premiums to increase dramatically • Unaffordable insurance premiums for low-income Iowans • Significant increases in motorcycle insurance costs • Increase in uninsured drivers IIAI opposes legislation that would change the ability of a party to collect for “phantom” third party damages under the Uninsured Motorist Coverage,

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|independent Continued from page 55

Insurance Agents of Iowa Legislative Survey

and would be concerned about making any changes to the Uninsured Motorist Coverage requirements.

Issue #4 – Certificates of Insurance

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ach year, the independent insurance agents in the state of Iowa produce millions of certificates of insurance. A certificate of insurance is defined as a document issued by an insurance agent that is used to verify the existence of insurance coverage under specific conditions granted to listed individuals. More specifically, the document lists the effective date of the policy, the type of insurance coverage purchased, and the types and dollar amount of applicable liability. Requests are made often and frequently by third parties for

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certificates of insurance. For example, a third party will almost always require evidence of a certificate of insurance when hiring an independent contractor. Demands by third parties, who leverage contractual power, are suddenly asking for terms of coverage that is not readily available in the common market place to be included on the certificate. For example, many third parties demand notification of cancellation of insurance thirty days in advance, even though they are not a party in the contract. Most insurance companies will not honor these demands, in turn, this places the independent contractor in breach of their contract. IIAI believes legislation should be passed which would prohibit unrealistic insurance demands by third parties, who control the contract negotiations with their subcontractors.

Issue #5 – Workers’ Compensation

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owa law currently grants the employer the option to select the medical care provider for an injured worker. In the past, legislation has been introduced which would give the employee exclusive control of their medical care for a work related injury covered by workers’ compensation. It is estimated that legislation which gives employees exclusive control over their care could raise the Iowa workers’ compensation rates by as much as 13%, according to the National Council on Compensation Insurance. Iowa businesses enjoy one of the best and most competitive workers’ compensation insurance markets in the country. In addition, Iowa workers have some of the best workers’ compensation benefits in the country. Current Iowa workers’ compensation law allows an injured worker to appeal to the workers’ compensation division to change providers if they feel the current care is unacceptable. Iowa’s workers’ compensation law has existed for over 100 years and treats employees and employers fairly. IIAI opposes legislation which would give the employee exclusive control over their work related health care. If an employee objects to the care, they may make application for alternative care to the Workers’ Compensation Commissioner who may authorize a change.


{IIAI 2010 Iowa Legislative Survey} Please mail to: Independent Insurance Agents of Iowa 4000 Westown Parkway, Ste. 200, West Des Moines, IA 50266; fax to (515) 222-0610; or email to cindy@iiaiowa.org by August 20, 2010. Name____________________________________________________ Party___________________________________________ Address__________________________________________________ District_________________________________________

_________________________________________________

City/Counties You Represent_________________________________________________________________________________ ____________________________________________________________________________________________________________ Would you support the Iowa Insurance Division to be the sole regulatory authority dealing with the Iowa health insurance exchange? Yes________

No________

Undecided________

Comments:__________________________________________________________________________________________________ ____________________________________________________________________________________________________________ ____________________________________________________________________________________________________________ Would you support the licensed insurance agent/producer to be the exclusive source to purchase coverage from the Iowa health insurance exchange? Yes________

No________

Undecided________

Comments:__________________________________________________________________________________________________ ____________________________________________________________________________________________________________ ____________________________________________________________________________________________________________ Would you support repealing the requirement to pre-notify customers of health insurance rate increases and/ or public hearings addressing rate increases that the Iowa Legislature passed during the 2010 Session? Yes________

No________

Undecided________

Comments:__________________________________________________________________________________________________ ____________________________________________________________________________________________________________ ____________________________________________________________________________________________________________

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Would you oppose legislation which would expand Iowa’s law dealing with wrongful death settlement as proposed in HF 758, which would increase liability insurance costs and provides that a spouse or child of a person may recover for the expense and actual loss of support, services, companionship, and society resulting from injury to or death of the person (damages recoverable may include damages for a decedent’s loss of enjoyment of life, measured separate and apart from the economic productive value the decedent would have had if the decedent lived and such damage shall not be duplicative of damages recoverable in an action for the injury or death of a spouse or parent and in an action for injury or death of a child)? Yes________

No________

Undecided________

Comments:__________________________________________________________________________________________________ ____________________________________________________________________________________________________________ ____________________________________________________________________________________________________________ Would you oppose legislation impacting Uninsured Motorist insurance coverage which would increase consumer’s costs? Yes________

No________

Undecided________

Comments:__________________________________________________________________________________________________ ____________________________________________________________________________________________________________ ____________________________________________________________________________________________________________ Would you support passage of legislation restricting unreasonable coverage and cancellation notice requests for certificates of insurance from entities not directly a party to the contract? Yes________

No________

Undecided________

Comments:__________________________________________________________________________________________________ ____________________________________________________________________________________________________________ ____________________________________________________________________________________________________________ Would you oppose legislation which gives an employee exclusive control of their health care for a work related injury covered by the employer’s Workers’ Compensation coverage? Yes________

No________

Undecided________

Comments:__________________________________________________________________________________________________ ____________________________________________________________________________________________________________ ____________________________________________________________________________________________________________

Signature:_ _________________________________________________________

Date:____________________________


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