Issuu

August 2016

GREEN MOUNTAIN AGENT A PUBLICATION OF VERMONT INSURANCE AGENTS ASSOCIATION

Green Mountain Agent is a publication of

In This Issue: 600 Blair Park Road Suite 100 Williston, VT 05495 Phone: 802-229-5884 Fax: 802-876-7912 www.viaa.org VIAA Officers

August 2016 4 Message from the President 8 Young Agents News Brief 10 Help Wanted 15 Annual Meeting Notice

Features

President Daniel Lussier

18 Are You Ready For a Data Breach?

Vice President Peter Richards

23 Centennial Anniversary: Green Mountain Insurance Company

Secretary/Treasurer Erin Odell IIABA & PIA State National Director Ron Bixby

28 Sales Success: Two Ears, One Mouth 31 E&O: Vacant Structures and E&O Claims

Directors

News

Chip Ams

33 ACUITY

Alan Kinney Paul Plunkett

35 Ohio Mutual

Staff

36 Vermont Mutual

Executive Director Mary Eversole meversole@viaa.org

GMA Publication Design Thorin Markison thorinmarkison.com

Are you trying to reach Vermont’s Independent agent’s? Do you have a great ad that represents your company and have nowhere to place it? Are you looking to hire? Place your ad in VIAA’s monthly publication and have the opportunity to advertise and market to Vermont’s Independent Agents.

Questions on how to place an ad? Contact Mary Eversole at meversole@viaa.org for placement options and advertising rates. Vermont Insurance Agents Association ATTN: Advertising/ 600 Blair Park Road/Suite 100/Williston, VT 05495

Message from the President “And to make an end is to make a beginning. The end is where we start from.” -T.S. Eliot I would be remiss if I didn’t take this opportunity to congratulate Green Mountain Insurance Company, a member of the Concord Group Insurance Companies, on their Centennial Year! My sincerest thanks to Mary Eversole, our Executive Director, for her tireless work taking care of members, managing our operations and keeping the Board of Directors moving forward. I’m proud to pass the President’s Gavel to Pete Richards, The Richards Group, who is our next President. You’ll be in good hands with him.

Time Flies It is hard to believe that my term as president is almost over and that I will leave the VIAA Board in September. Over the years there have been a lot of changes at VIAA. We’ve survived the financial crisis, retirements, downsizing, remodeling, and moving. Let’s not forget about mergers and acquisitions! VIAA is celebrating its 110th year. That’s remarkable for a small association from a rural state. That says a lot about our members and the generations that came before us. I’m excited to see the next generation (aka YACs) involved in the association and doing a phenomenal job. Membership has changed over the years, engagement is different, gone are the three day conventions, but the importance of the association still remains. The ability to persevere all these years is also because of the support of our company partners. Their generosity is overwhelming, especially during the last few years. I cannot thank them enough.

Most importantly, my thanks go out to you, the members, for your loyal support over the years and in the future. For without you, VIAA would not exist. It has been my pleasure to serve you.

Dan Lussier, VIAA President

SAVE THE DATE FOR VIAA'S LARGEST AND MOST ANTICIPATED EVENT OF THE YEAR! Approximately 300+ member agents, Young Agents, and company representatives join together to network and learn. This event is an invaluable opportunity for insurance professionals of all ages, rank, and experience levels and is a must-attend for all independent agents. This year, the Annual Convention includes informative Continuing Education sessions with William C. Wilson, Jr., CPCU, ARM, AIM, AAM and lively social events along with golf. The Young Agents Committee is hosting Casino Night. Local and national exhibitors will be in attendance to provide updates on their

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HELP WANTED: Commercial Account Manager Handle special projects/other related assignments as requested. • Create the #1 customer experience in the independent agency system that creates value and frequently returning customers. Titus Insurance Agency in Shelburne, VT is looking for an experienced Commercial Lines Account Manager to join our professional team. Qualified applicants should enjoy working within a fast pace team environment; demonstrate enthusiasm, a positive attitude, strong communication and problem solving skills. You will be responsible for building relationships with clients and carriers by delivering exceptional customer service, coverage review, looking for opportunities to provide relationship value, answer billing questions, and process endorsements/ changes to existing insurance policies. Primary Expectations: • Respond to and resolve account related inquires, handle complex customer calls in a timely and professional manner. • Build solid carrier relationships to expedite solutions to our agents/policyholders. • Knowledge of the carrier’s capabilities and systems, their underwriting appetite, in order to remarket accounts and improve account retention. • Be proactive with agents in updates on significant policies changes or events. • Handle policy change requests, be empowered to make appropriate decisions, and take ownership to resolve customer issues that will foster long term relationships with the agency. • Policy coverage review and recommendations with customers/agents. • Active use and documentation within the data management system. 10

• Ability to manage all aspects of renewal process and new business. Requirements • 3 years of P&C insurance experience, knowledge of commercial coverage • P & C Licensed • Experience in the use of e-mail and agency management systems • Strong Organizational Skills Offers a VERY competitive compensation and benefits plan Please send confidential responses to:

Annette@titusinsurance.net or mail to Titus Insurance, PO Box 476, Shelburne, VT 05482

HELP WANTED: Commercial & Personal Lines Producers

New England Excess Exchange, Ltd. is seeking Commercial and Personal Lines Producers to join our growing team! NEEE, Ltd. is a family owned and operated E&S brokerage firm, established in 1981, based in Barre, Vermont with 48 employees. The ideal applicant for Commercial or Personal Lines would have a bachelors degree or commiserate insurance experience. That said, we’ve found the most successful underwriters are detail oriented and driven with strong organizational skills while having an analytical mind and welcoming personality. This individual will need to obtain their state Property and Casualty license and maintain the Continuing Education units as directed by state regulatory guidelines, with our aide; but, we will train them in the role and, at least initially, have the renewals and a submission flow from which they can develop professional relationships and the experience needed to grow a book of business. If they can efficiently multitask, while delivering a high degree of accuracy, they will enjoy a very successful and lucrative career here at NEEE, Ltd. These are commission structured positions with a generous draw to allow for livable bi‐weekly pay between quarterly commission opportunities. Primary Expectations:      

Provide superior customer service to our agents and partner companies Develop relationships with agents and markets Accountable for underwriting decisions Manage a large volume of calls and emails with timely responses Ability to work independently and within a team Excellent oral and written communication

Applicants can submit their resume to Renee Grzankowski, rgrzankowski@neee.com.

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Annual Meeting Notice Ladies and Gentlemen, This letter serves as notice of the Vermont Insurance Agents Association 110th Annual Business Meeting

Thursday, September 8, 2016 Capitol Plaza Hotel, Montpelier Room 100 State Street, Montpelier, VT 05602 The primary agenda of the meeting is to install new officers and directors. This agenda and or topics listed here are subject to change. Thursday, September 8, 2016

I look forward to seeing you in Montpelier. Sincerely, Dan Lussier

Vermont Insurance Agents Association

VIAA President 11:00 am

Registration and Networking

11:30 â€“ 1:30 pm Lunch, Business Meeting Installation of New VIAA Board President Peter Richards, The Richards Group Please RSVP by August 29, 2016 Inquiries: mary@viaa.org or 802.229.5884

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What your fellow agents have to say about the VIAA Trusted Choice campaign: “No other campaign I have been involved in delivers more exposure to my agency than VIAA’s Trusted Choice advertising program.” - Jon Jamieson, Jamieson Insurance

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Are You Ready for a Data Breach? By Judi Newman & Bill Larson Insurance company-agency agreement wording for both property-casualty and group health agents requires unequivocal compliance with all current state and federal privacy and data breach response laws, including the following: Gramm-Leach-Bliley Act (GLBA) Fair Credit Reporting Act (FCRA) Fair and Accurate Credit Transaction Act (FACTA) Health Insurance Portability and Accountability Act (HIPAA) Health Information Technology for Economic and Clinical Health Act (HITECH) Agency agreements tend to be one-sided and typically require that “the agency hold the company harmless for any claim, demand, liability, dispute, damage, cost, expense or loss including reasonable attorney’s fees and cost of litigation arising as a direct result of the acts, errors & omissions and negligence of the agent.” Following an extensive review of more than 100 company-agency agreements, most p-c and group health companies require agency compliance with all federal and state laws. For example, p-c agency agreements reference the GLBA, while group health agency agreements, both individual and agency, cite HIPAA and HITECH. GLBA is a robust law and applies to most insurance agents. If an agency wants to protect itself from fines, penalties and the possible breach of contract provisions with insurance companies, it must comply with the agency agreement and, by extension, all other relevant laws. Here are a few key compliance components to keep in mind. Privacy plan: Privacy laws apply to personal information you collect, use and disclose with other organizations in the course of doing business. Personal information is information about an identifiable individual, including 18

information that relates to a particular person and allows that person to be identified. GLBA requires companies to give consumers privacy notices that explain the institution’s information-sharing practices and how they will protect the consumer’s nonpublic information. In turn, consumers have the right to limit some—but not all—sharing of their information. Security plan: Information and information systems are assets which agents should protect from accidental or unauthorized access, disclosure, modification, destruction or denial. Security controls must be sufficient to ensure confidentiality, privacy, reliability, integrity, audit capability and availability of information. You will need to identify potential threats and analyze and prioritize those threats, devise plans and strategies to reduce the likelihood of those threats occurring and maintain a contingency plan to address and mitigate any damage that might result from a breach. Data breach response plan: More than 30 federal laws and regulations address privacy and

security on nonpublic personal information. At a more local level, 47 states and the U.S. territories of Guam, Puerto Rico and the U.S. Virgin Islands have regulations and laws on what a business must do to respond to a known breach.

p-c and group health agency agreements could require agencies to pay the following costs and expenses—in addition to the direct costs and expenses the agency incurs in defense of action:

Costs of the company’s investigation of the Defining “business associate” for agency as well as a national investigation, since insurance agents: Compliance with HIPAA is the breach originated at the agency level not an option for insurance agents who are Costs of the required company notifications considered business associates. Insurance agents involved in the sales and service of group health Costs of attorney fees the company accrues Defense and liability costs the company accrues insurance coverage need only review any or all of these company-agency agreements to Additional costs the company accrues as a see that they are indeed business associates result of the agency’s signed agency agreement of the insurance companies represented. Based on the insurance company language, Under HITECH, business associates are now if the agency is found to be the cause directly “on the compliance hook” since they of a data breach through negligence or are required to comply with the safeguards noncompliance, the expenses, fines and the security rule contains. HITECH does penalties could be a death wish. In any event, not speak directly to the rationale, but even it will be a long, costly process—and the casual observers understand that a potentially end result is likely going out of business. massive expansion in the exchange of personal Judi Newman is president health information increases the privacy of NetGenDataConsulting and Phaze II Consulting, and security concerns of all stakeholders. Inc. Bill Larson is president of Profit Protection Summary of agency agreement: The hold Risk Management Consulting and partnered with harmless and indemnification sections in most Newman to further NetGenDataSecurityConsulting.

2016

Founded in 1901, Ohio Mutual has over 100 years of experience in the insurance industry. With more than a century of successful history behind us, we retain the values upon which we were founded, while offering a broad array of industry-leading products and cutting-edge technology. We are proud to offer products in Vermont and four other New England states.

Steadfastly committed to the Independent Agency System At Ohio Mutual, we recognize our independent agents as business partners. Weâ€™re looking for a select group of agencies to contribute to our growth in competitive niche markets in both commercial and personal lines in Vermont. We are open to appoint new agents in Vermont! If you feel your agency shares the values and the vision of Ohio Mutual, please contact Territory Field Manager Philip Archambault at 866-785-9533 or email parchambault@omig.com.

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Centennial Anniversary: Green Mountain Insurance Company, Berlin, VT The Concord Group Insurance Companies is recognizing Green Mountain Insurance Company’s Centennial Anniversary this year. Green Mountain Insurance Company is one of five underwriting companies of The Concord Group and is based in Berlin, VT. In researching the commencement of Green Mountain Insurance Company we learned a great deal about the founding principle and share part of his story below. An expanded version of this article and credits may be found on Concord Group’s website under “About Us”. The company was incorporated under the laws of Vermont July 27, 1916. It was incorporated as a mutual with a guaranteed capital. At its commencement it had an authorized capital of $200,000 of which $50,000 had been subscribed and paid in. The Green Mountain Mutual Fire Insurance Company was established by H. J. M. Jones of Montpelier, Vermont, a successful granite business owner and civic leader. Hugh John Morris Jones was the youngest of four brothers who owned a granite wholesaling business called Jones Brothers Company. H. J. M. Jones began his career with the Company as a traveling salesman. In 1886 after four years of strict wholesaling, Jones Brothers purchased a Dark quarry, and the stock and equipment of a granite cutting plant at Barre, Vermont, renting the land and building. This plant, known as the Mackie & Simpson Plan, was located on Granite Street, Barre. The quarry was situated on Millstone Hill, nearly three miles from Barre. H. J. M Jones took pride in being an active civic leader in the greater Barre area and in the State of Vermont. Although the city of Barre counted Hugh J. M. Jones a resident, Jones actually resided in Montpelier at 100

East State Street. His former home is listed on the National Register of Historic Places. In September 1917, Vermont Governor Horace F. Graham appointed Hugh J.M. Jones Chairman of a committee to study means to obtain more coal for Vermont residents. There was genuine concern that Vermont residents would not have enough coal for the upcoming winter creating conditions in which residents would freeze and businesses shut down. Apparently, the lack of coal in the state was due to coal dealers not cooperating with one another. Jones was called upon to bring the dealers together and seek their cooperation in bringing more coal to Vermont. The coal dealers assembled in Burlington at the urgent call of Jones’ committee. They pledged their loyalty and full cooperation to the committee and that various sections of the state would quickly obtain more coal. Testimony to Jones’ civic leadership, prompt and adequate shipments of coal into Vermont were ordered and a potential disaster averted. We hypothesize that Green Mountain was formed to provide fire and marine insurance to the granite industry and eventually to other Vermont businesses. Jones assembled a talented group of business leaders and industry veterans Continued on pg.25

Centennial Anniversary: Green Mountain Insurance Company, Berlin, VT

The treasurer of the company was Mr. Edward H. Deavitt, former State Treasurer and Insurance Commissioner of Vermont. The Board of Trustees included George L. Blanchard, President, Capital Savings Bank and Trust, Montpelier; Luther A. Cobb, President, Island Pond National Bank; Sanford A. Daniels, State Senator and insurance agent from Brattleboro; Edward H. Deavitt A. Barber Noyes, President, Passumpsic Savings Bank and Trust Co; E. L. Walker, insurance agent from Bellows Falls; and several other prominent banking and woolen manufacturing leaders. It should be noted that Mr. Deavitt would later serve as President of Green Mountain following Jones’ passing in 1929. In the first full year of Green Mountain Mutual Fire Insurance Company’s operation in 1920, Gross premiums written were $50,398.95 and paid reinsurance costs of $24,938 plus returned premiums of $7,634.71 produced net premiums written $17,826.24. With assessments of $11,294.02, interest of $2,5062.15, rent of $480, total income was $32,162.41. Regarding disbursements, net losses paid was $10,966.95, underwriting expenses $6,776.02, dividends to policyholders $460.40, dividends on stock $1,000 plus other disbursements of $3,299.05 cumulated $22,511.42 in total disbursements.

tIn 1962, a conversion from the mutual plan of operation to that of a capital stock basis was completed and in 1970, all of the outstanding capital stock was purchased from Merchants Mutual Insurance Company by Concord General Mutual Insurance Company. Today, the Company writes primarily commercial, personal auto and homeowner coverage. The Company operates in New Hampshire, Maine, Massachusetts, and Vermont and is also licensed in New York, but is not currently writing any business there. Naturally, much has changed in the world around us over the last 100 years and yet key fundamentals have not wavered. Namely Green Mountain leadership remains civic minded and supported by a talented group of business leaders and industry veterans to help manage Green Mountain’s success and our next 100 years. 1922 Insurance News Archives

to help manage Green Mountain. The secretary and managing underwriter was William A. Ellis and formerly of the Vermont Mutual Fire Insurance Company. He had seventeen years’ experience at the time of his appointment.

VIAA Congratulates

Green Mountain Insurance Company On Their Centennial Year!

Two Ears, One Mouth Phil Schuman “I think I’m good at selling because I love talking!” This self-assessment from one of the group at a recent sales training opened a valuable discussion into what makes a good salesperson. Turns out it’s not a lot of talking that makes the best salespeople, but rather the ability to truly listen. The selling process boils down to effective networking, building rapport, understanding customer needs, matching benefits to needs, closing the deal and opening a lasting relationship. All of these steps require one common skill: masterful listening abilities! It’s why it’s said we have two ears and one mouth – we should be listening at least twice as much as we’re speaking. The Dalai Lama is a master of human relationships and he has said: “When you talk you are only repeating what you already know, but when you listen you may learn something new.” Next time you’re tempted to start speaking too much remember that LISTEN is an anagram of SILENT! When networking and building rapport, remember the two things all humans look for in a meaningful interaction is to be listened to and to be understood. Think back to the last networking event you attended and how disengaged you felt when the person you were speaking with did nothing but talk about themselves. We remember far more favorably the person who asks us intelligent questions and truly listens to the answers. The person looking around the room or checking their phone when we’re answering their question is certainly not gaining any favors! As Dale Carnegie said: “If you want to be interesting, be interested!” Active listening not only helps build rapport and lets the other person know they are valued but it also serves another great purpose when it comes to selling your product. The only way to sell the appropriate benefits to any particular prospect is to understand what they truly need. And the only way to know what 28

they need is to ask probing questions and then listen to the answers. Many of us are good at not talking once we’ve asked a question but it’s hard to put our hand on our heart and say we’re always good at actively listening. To quote Stephen Covey from “The 7 Habits of Highly Effective People”: “Most people don’t listen with the intent to understand, they listen with the intent to reply.” It’s a very worthwhile exercise next time you’re listening to someone to make sure you’re not just focused on queuing up the next thing you want to say as soon as their mouth stops moving! Instead actively listen to what they’re saying and you’ll be skillfully queuing up all the appropriate benefits your product has that matches their needs and wants. That’s effective selling – and good manners! Just as gratitude is the key to happiness and success in life, so too is listening the key to happiness and success in sales. Happy Selling! The Schuman Group empowers sales teams with real world tools through sales training, coaching and consulting services.

www.schuman-group.com

Everything you insure is on your shoulders

Who do you trust to have your back? VIAS offers the most prestigious Errors & Omissions carrier(s) in the country: Westport Insurance Company & Utica National Insurance Group

For a quote or for more information contact Helen Collins at hcollins@viaa.org or 1-844-609-1481

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Vacant Structures and E&O Claims Errors & Omissions (E&O) claims involving vacant structures are on the rise. It is common for a client to blame their insurance agent when a carrier denies coverage for a claim based on the insurance contract’s vacancy exclusion. In most cases, the agent is unaware that a residential or commercial structure is unoccupied or vacant when placing coverage for a specific risk. Insurance agents can take these easy yet important steps to avoid getting caught in the “vacancy vacuum”:

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Verify the intended use of your client’s property and confirm it in writing.

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Company News ACUITY EARNS STAR AWARD FOR OUTSTANDING OPERATING RESULTS Acuity earned a 2016 Stakeholder Team Accomplishment Recognition™ (STAR) Award from independent financial analysis firm Demotech, Inc., putting the company among the top 1.1 percent of insurers nationwide. The Demotech STAR Award recognizes insurers whose performance benefits all stakeholders, including agents, customers, employees, consumers, regulators, and reinsurers. Acuity was honored with a STAR award for exceeding the industry in all areas of performance, including financial strength and stability, profitability, claim handling, and compensation to employees and agents. Just 29 of the 2,628 property-casualty carriers evaluated qualified for a STAR Award. “This is further external, independent validation of Acuity’s financial strength in protecting our customers and growing with our independent agents,” observes Ben Salzmann, Acuity President & CEO.

insurance industry by providing consulting services as well as accurate and proven Financial Stability Ratings® (FSRs) for property and casualty insurance companies of all sizes.

Demotech, Inc. is an independent financial analysis firm located in Columbus, Ohio. Since 1985, Demotech, Inc. has been serving the

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IMPERIAL PFS IS PLEASED TO ANNOUNCE OUR NEW PARTNERSHIP WITH VIAA. ®

IMPERIAL PFS® AND VIAA ARE WORKING TOGETHER TO CUSTOMIZE FINANCE PROGRAMS FOR MEMBER AGENCIES. To learn more about special programs for VIAA members, contact Steven Abramovitz at: 617.990.2364 or by email at: steven.abramovitz@ipfs.com

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Company News Ohio Mutual’s Financial Strength Reaffirmed by A.M. Best Insurance rating organization A.M. Best has issued its annual rating of Ohio Mutual’s financial strength, reaffirming the company’s financial strength rating (FSR) of “A” (Excellent) for the 24th consecutive year and its issuer credit rating (ICR) of “a+” for a second year. The ratings include the three companies included in the OMIG intercompany pool: Ohio-domiciled Ohio Mutual Insurance Company, its wholly owned subsidiary United Ohio Insurance Company, and Mainedomiciled Casco Indemnity Company.

“Our strong operating performance is something we continually strive to maintain and build upon, and this rating from A.M. Best is a clear affirmation of Ohio Mutual’s financial strength and integrity,” said Ohio Mutual President & CEO Mark C. Russell. “We thank our agent partners, our associates, and our policyholders for their contributions to our ongoing shared success.” Founded in 1899, A.M. Best Company is the world’s oldest and most authoritative insurance rating and information source. More information is available at www.ambest.com.

A.M. Best’s rating rationale states: “The group’s Ohio Mutual Insurance Group, founded in favorable five-year operating performance 1901 and based in Bucyrus, OH, partners with has been the result of a steady stream of nearly 400 independent agencies to distribute investment income and other income, as well quality property and casualty insurance as modest underwriting income. Additionally, products throughout Ohio, Indiana, Maine, OMIG’s five-year pre-tax returns on revenue Vermont, New Hampshire, Connecticut, and equity have outperformed the private and Rhode Island. Additional company passenger standard auto and homeowners information is available at www.omig.com. composite average.” Best also cited “the group’s conservative investment philosophy, favorable loss reserve trends and strong internal controls” and noted the company’s “long-range profitability strategy, which includes adequate More than a promise . . . pricing and disciplined underwriting, as well 1725 Hopley Avenue, P.O. B 419.562.30 as improved technology and enhanced internal o processes to sustain profitable growth.”

Ohio Mutual’s Financial S Reaffirmed by A.M. B

BUCYRUS, OH – Insurance rating organization A.M. Best has issued Mutual’s financial strength, reaffirming the company’s financial stren (Excellent) for the 24th consecutive year and its issuer credit 35 rating (I

Company News Vt Mutual Recognized by Ward Group as a Top 50 Insurer for 8th Consecutive Year Ward Group, an Aon Hewitt company, has once again recognized Vermont Mutual Insurance Group® as one of the top 50 Property and Casualty insurers in the United States. This is the eighth consecutive year Ward Group has affirmed Vermont Mutual as a “Ward’s 50®” insurer. Every year, Ward Group identifies the industry’s top insurance companies through a comprehensive financial analysis of approximately 3,000 U.S. property and casualty insurers. The “Ward’s 50” recognizes insurers for their consistency, safety and superior financial performance. Daniel C. Bridge, President & CEO of Vermont Mutual, stated “it’s deeply gratifying to once again be recognized as a top performing insurance company by Ward Group. This noteworthy recognition is confirmation of our commitment to managing a financially secure insurance operation for our policyholders, our independent agency partners and our employees. Through uncertain economic times and periods

of historic weather-related losses, Vermont Mutual continues to achieve the superior financial performance that allows us to meet and exceed the needs of our customers.” Bridge continued “we are honored to share this with our employees and business partners, whose combined efforts have allowed us to earn this recogntion now for 8 consecutive years.” Every company recognized by Ward Group has passed all safety and consistency screens and achieved superior performance over a five year period. This is the 26th year Ward Group has conducted the analysis. As a recipient of the Ward’s 50 designation for eight consecutive years, Vermont Mutual has once again affirmed its position as a leading provider of automobile, homeowner and business insurance in the Northeast, and ranks their performance in the top tier of all companies nationwide since 2009.

Helen Collins hcollins@viaa.org

TrustedChoice.com

Vermont Insurance Agents Association SM

Perpetuate the Industry? Check.

Donâ€™t wait until the office is empty to find new talent â€“ support InVEST and find new recruits now. InVEST is a free, classroom to career program designed to increase awareness of the insurance industry with high school and college students. And, InVEST has been making huge strides over the last year. With a new student center, career center and more scholarship dollars than ever before, InVEST is touching more and more students daily. InVEST, a 501 (c)(3) non-profit, is supported by financial contributions from insurance companies and individuals, in addition to the active involvement of hundreds of insurance professionals. For volunteer and donor opportunities visit www.investprogram.org.