2020 Year In Review

2020 REPORT

SERVICE. ADVOCACY. INTEGRITY. INNOVATION.

YEAR IN REVIEW

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FAIA 2020 YEAR IN REVIEW

A NOTE FROM FAIA'S PRESIDENT & CEO There is no doubt that 2020 was a challenging year. As the world shut down in mid-March last year because of the global pandemic, COVID-19, many industries were gripped with fear in the face of economic uncertainty. But, while many industries were dealt heavy blows as a result of governmentmandated lockdowns, the insurance industry, and independent agents more specifically, fared quite well by comparison.

The independent agency business has been and continues to be incredibly resilient to economic downturns. Last year, many agents renewed their focus on the value proposition they provide to their clients: being a trusted advisor during difficult times.

FAIA did the same. We focused on the value proposition to our members by being effective advocates and a source of credible information agents could rely on to make business decisions.

I believe our work making sure agencies were considered “essential businesses,” ensuring your 4-40s could work remotely, and providing you timely information regarding government assistance programs allowed you to focus on running your businesses and remaining profitable.

For the first time in many years, we had to cancel our Convention and many other inperson events our members have come to know and love. Instead, we pivoted and began providing more events virtually. We hosted our first eSummit, a virtual insurance game for Young Agents, and countless other virtual events to keep members engaged and up to speed on the issues that matter most to you.

This past year has also been a time of significant change and transition at your association. FAIA’s President and CEO of 22 years, Jeff Grady, retired, as did our CFO of 24 years, Larry Thompson. Our success and accomplishments over the past year would not have been possible without the steadfast leadership of our chairs, the board of directors, volunteer leaders, and dedicated staff.

Challenges remain ahead. In addition to the impacts of COVID-19, Florida faces a quickly deteriorating property market. FAIA continues to stand ready to make sure our members have all the tools necessary to navigate these difficult times.

I tell our team all the time…challenging times create incredible opportunities for those who are willing to adapt. This year has shown that agents can and will, and we, your association, will be there every step of the way.

KYLE ULRICH President & CEO

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FAIA 2020 YEAR IN REVIEW

THE BIG PICTURE

In 2020, FAIA grew an already strong member count despite the challenges brought on by COVID-19. FAIA remains among the largest agents associations in the U.S., and we are proud to serve members as a strong advocate and vital business partner.

The Florida Association of Insurance Agents is a nonprofit state trade association of insurance agencies affiliated with the Independent Insurance Agents and Brokers of America, Inc. The association's wholly-owned subsidiary, FAIA Member Services, provides products and services to agencies as a benefit of membership.

Our mission is to serve the needs of Florida insurance agents and consumers by promoting a healthy and competitive insurance environment.

This year we served our members through advocacy in the Legislature, continuing education, professional development, networking, and exclusive member benefits.

Working for Florida's independent agents since

1904

TOTAL RESERVES

While there are many ways to measure an organization's financial health, the growth of FAIA's total reserves over the last decade speaks volumes. For more detail, read our 2020 Condensed Consolidated Financial Statement.

15,000,000

10,000,000

5,000,000

0

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

FAIA 2020 YEAR IN REVIEW

COVID-19 In 2020, the COVID-19 global pandemic upended the way people all over the world live and work.

While the pandemic impacts will continue to reverberate for years to come, this time also presented challenges that required an immediate response.

Beginning in mid-March, FAIA closed our offices and began working remotely. Quickly, our focus shifted gears to help address the questions and concerns we were hearing from our members. Are insurance agents considered essential service providers? What guidance has the Office of Insurance Regulation shared? How do agents get licensed with testing locations closed?

Over the course of the year, we canceled in-person events, shifted our focus to virtual meetings and educational opportunities, and worked harder than ever to ensure our members had the information and resources they needed to serve their clients.

Within the first few weeks of Florida's shutdown, FAIA advocated for insurance agencies to be considered essential businesses; worked with CFO Patronis to waive the statutory requirement that 440 licensees must work from the office; and requested guidance from the Office of Insurance Regulation regarding surplus lines carriers with general liability policies in force in Florida.

Over the course of the year, new questions came up. Topics included E&O exposure, business income coverage, cybersecurity and liability, and workers' compensation issues. With each new challenge, our team shared information and resources through blogs, emails, phone calls, Zoom meetings, webinars, and every other tool available to us.

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FAIA 2020 YEAR IN REVIEW

MEMBERSHIP Our organization is strong because our membership is strong. In 2020, we maintained the largest agency membership count among all Big "I" state associations.

We added 144 new agency members for an annual total of 2,028 members. The association is also home to 298 associate members. This year, we retained 95 percent of our members, and over the past five years, we have maintained a retention rate above 94 percent.

2,028 298 Agency member locations

Associate members

ADVOCACY During the 2020 Legislative Session, FAIA advocated for and helped pass legislation requiring both admitted and non-admitted insurers in any line of business to release five years of claims data and loss runs to an insured within 15 days of the insured’s request.

FAIA, in conjunction with the Big “I,” advocated on a local, state, and federal level for insurance agencies to be considered “essential” businesses, giving them the ability to remain open during mandatory COVID-19 shutdowns that applied to other “non-essential” businesses.

Additionally, during the early days of the COVID19 pandemic in Florida, FAIA successfully lobbied the chief financial officer and the governor to waive the statutory requirements mandating 4-40 licensees to work within the confines of their offices, thus allowing them to work remotely for a period of almost eight months.

95% Annual membership retention rate

FAIA 2020 YEAR IN REVIEW

YOUNG AGENTS COUNCIL FAIA's Young Agents Council is dedicated to fostering a supportive environment for young insurance professionals committed to growing their careers and communities. Despite the unique networking challenges that 2020 presented, FAIA’s Young Agents Council found creative ways to continue helping young insurance professionals grow their careers and communities.

The Council hosted an insurance video game competition with 98 registrants and successfully hosted three virtual networking meetings for the Young Agents Council Task Force. More than 35 YAC members attended a unique 2020 YAC Political Summit, which included a walking tour of the Florida Governor’s Mansion in Tallahassee.

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261

Young agent members across the state

$5,191

in school supplies, collected and donated to children throughout the state

$160,000 donated to Folds of Honor since 2010, with over $10,000 raised in 2020

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FAIA 2020 YEAR IN REVIEW

SUMMER ESUMMIT In May, FAIA decided to cancel the Convention in response to the COVID-19 pandemic. Over the next two months, the association team switched gears, and in July, FAIA hosted its first-ever Summer eSummit. This three-day virtual conference featured seven separate CE breakout sessions worth up to 12 hours of CE and three general sessions from renowned insurance trainers and speakers we had planned to feature at the Convention. More than 1,200 individuals attended over three days, earning more than 6,400 continuing education hours.

Member feedback showed that the event was a success. In response to our post-event survey, over 93 percent rated the event very good or excellent, and 98 percent said the eSummit added value to their membership.

6,400 hours of free continuing education earned by eSummit participants over three days

SURVEY SAYS...

98% OF MEMBERS SAID THE ESUMMIT ADDED VALUE TO THEIR MEMBERSHIP 93% RATED THE EVENT VERY GOOD OR EXCELLENT

FAIA 2020 YEAR IN REVIEW

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EDUCATION In 2020, FAIA’s education team pivoted to offering exclusively online courses when the COVID-19 pandemic closed all in-person events. FAIA already produced many webinars and webcasts for CE credits, but in 2020 all class offerings, whether formerly on the road, in various locations around the state, on-site at an agency or company, or National Alliance-affiliated, joined the virtual lineup.

In addition to bringing existing courses online, FAIA's education team also launched the first FAIA Academy: 2-20 Edition as a direct response to an issue related to 4-40 licensees working remotely during the COVID-19 pandemic.

Through an Executive Order from the governor and subsequent directive from Florida's CFO, 4-40 licensees have been able to work remotely since early 2020. Once these orders expire, however, those licensees would no longer be able to transact business outside the office. For many who have welcomed the flexibility of remote work, this created a new challenge.

The FAIA Academy was built to help prepare qualified 4-40 licensees to sit for their 2-20 exam in four weeks.

With their 2-20 license in hand, agents would continue to work remotely beyond the time of the emergency order. The Academy grew to include an option for agents to convert their 4-40 license to a 20-44.

In October, Florida was the first state to earn Diamond Elite recognition two years in a row from the Big "I" for Excellence in Insurance Education. After achieving 11 years of Diamond recognition, we're proud to continue our tradition of excellence. Dave Newell accepted the award as part of the Big "I" Education Convocation in Savannah.

6,200 agents and industry personnel received in-house and web-based CE training

FAIA 2020 YEAR IN REVIEW

WORKFORCE DEVELOPMENT The Florida Department of Economic Opportunity estimates that, on average, the insurance industry will add 1,887 new jobs a year through 2026, and we’ll need to replace more than 5,270 positions left open by retiring workers over the same time frame. Expanding the pipeline of qualified applicants is essential to growing our industry.

In 2020 FAIA provided support to Risk Management and Insurance programs at eleven different state colleges. We're looking forward to bringing on another four colleges soon.

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The Good Works Fund, a sustaining gift program with our insurance carrier partners, was established to keep this great work going. Seven companies executed gift agreements for a total pledge of $175,000.

We also have added four additional donors with five-year commitments. Thank you to AmWINS, Cabrillo Coastal, Southern Fidelity, and Heritage Property & Casualty.

$175,000 pledged to the Good Works Fund to support insurance programs in higher education

FAIA 2020 YEAR IN REVIEW

FAIA MEMBER SERVICES FAIA Member Services adds value to membership by offering best-in-class professional liability coverage, market access, and a suite of exclusive products and services through our Preferred Provider program. Our goal is to be independent agents' best business partner.

In 2020, we rewarded members for taking advantage of our products and services by returning more than $200,000 in utilization bonuses to 495 member agencies across the state. Over the last 10 years, FMS has awarded more than $1.9 million in utilization bonus money to FAIA members.

As FMS continues to expand its market access programs, FAIA members earn more commission dollars. These competitive programs have returned almost $100 million in commission income for agents over the past 10 years.

INDEPENDENT MARKET SOLUTIONS Independent Market Solutions (IMS) provides market access through association membership.

The program helps agents who cannot secure company appointments grow their business through competitive commissions and a pathway to direct appointment. In 2020, IMS expanded to operate in 16 states and added five new carriers for agents to access.

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We currently manage a $9 million professional liability book of business and the RLI umbrella program wrote $3.1 million in new business premium this past year, an 83 percent growth over 2019. Overall, our RLI book experienced a 24 percent increase this year, and we currently write over 16,000 policies through the program, making ours the largest RLI book of business nationwide.

Currently, Florida agents have access to the following carrier partners: Personal Lines American Traditions Insurance Co., Avatar Insurance, Cypress Property & Casualty Insurance, Heritage Insurance, JIBNA, MetLife Auto & Home, Swyfft, Monarch Insurance, National General, Progressive, Travelers, United Property & Casualty Insurance, and Universal North America Insurance Co. Commercial Lines Attune, Coterie, FHB Builders Risk Solutions, Florida Home Builders Insurance EDGE (general liability), National General, Progressive, RMS Hospitality, V3 Insurance