GMA June 2017

GREEN MOUNTAIN AGENT A PUBLICATION OF VERMONT INSURANCE AGENTS ASSOCIATION

Corralling Cyber Space JUNE 2017

Green Mountain Agent is a publication of

In This Issue: June 2017

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

Seasons May Change, But Our Commitment to the Independent Agent Channel Remains the Same...

VIAA Officers President Peter Richards

V

ermont Mutual is proud to have served Vermont and the New England market through the longstanding partnership with our Independent Agents. It remains our privilege to work with the finest Independent Agencies in the industry … the only place you can buy a Vermont Mutual policy.

Vice President Erin Odell Vermont Mutual is proud to sponsor the Vermont Insurance Agents Association’s new Education Center in Williston, Vermont.

Secretary/Treasurer Paul Plunkett IIABA & PIA State National Director Ron Bixby

Directors

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Message from Convention Chair

8

On the Hill

14 Department of Financial Regulation

Features 11 Update Your Operating Systems to Prevent Ransomware 17 Young Agents Committee 24 ‘Sort by Price’ is Lazy 20 Consumer Reports and Auto Insurance 27 Sales Success: Little and Often 31 E&O Corner

News 37 Acuity Insurance 39 Vermont Mutual

Help Wanted

Chip Ams Daniel Rodcliff Alan Kinney

Staff Executive Director Mary Eversole meversole@viaa.org

GMA Publication Design LONDONmiddlebury londonmiddlebury.com

89 State Street, P.O. Box 188, Montpelier, VT 05601 | 800.451.5000 | VermontMutual.com

41 NFP 43 Crowley Insurance Agency 43 The Richards Group

South Burlington, VT

It is my pleasure, as Convention Chair, to invite you to participate in VIAA’s 111th Annual Convention, at the Burlington Hilton September 21, 2017.

As agents, we spend our days evaluating risks for our clients, identifying and analyzing loss exposures, and finding the best insurance coverage to mitigate losses. One of our biggest challenges is how to protect our insureds from the Wild, Wild, West of cyber-attacks. Cybercrime comes in many forms. Some attacks are socially or politically motivated. The public, businesses big and small, government and our insureds are vulnerable to the spread of malicious viruses, unauthorized web access, fake websites, ransomware, and phishing and data theft.

Most small businesses pass on purchasing additional Cyber Liability Coverage. This is sadly true for insurance agencies as well.

The reason most often cited is the cost justification. But can a business, your agency included, afford to respond to a cyber threat, meet government regulations for a data 4

breach and notify customers as well of a breach? Experts would say no. I agree.

Cyber Space is indeed the new Wild West.

So much so it inspired us to make that our convention theme this year. We will bring in experts and companies that can help our agencies manage this threat and for our own agencies.

Ryan Speilman, Senior Director, from The Center for Internet, a nonprofit organization focused on improving global cyber security will join us at our luncheon. He will bring his expertise in corralling cyber space to protect insureds and our agencies.

NFP, a leading insurance broker and consultant that provides employee benefits, Country Club of Vermont, in Waterbury.

The property & casualty (P&C), retirement, and CCVT course is a Graham Cooke design individual insurance and wealth management located on a site that can only be described solutions is currently seeking an experienced as a magnificent setting for a golf course, Personal Lines Producer to advance his or offering stunning views in all directions. her career as a Commercial Lines Producer in its South Burlington office. This position Remember, Customer Service Representatives is Young responsible forwith generating new sales for and Agents, VIAA member all Commercial Lines and requires agencies, attend this eventpolicies free of charge, ability to back worktoclosely with clients, asthe a way to give our members. customer service representatives, producers, Registration opens on-line later this month. management, and insurance carriers. The work environment is professional and very The VIAA 111th Convention andhave supportive.

TheAnnual ideal candidate should Golf Tournament will be a memorable event. excellent interpersonal skills, {2+} years of We look forward to providing a world class experience, and ability to adapt to emerging insurance education experience and some fun, technology. They will be supported with unique networking opportunities. See you there! commercial lines training and mentoring for prospect/planning, sales calls, proposals and education. A property and casualty license is required. NFP offers a highly competitive compensation and benefits package.

Overnight accommodations are available at the Hilton Burlington Hotel to convention participants at a discounted rate of $189/night for September 21, 2017 – September 24, 2017. The special room rate will be available until August 28th or until the group block is sold-out, whichever comes first.

By popular demand, our annual golf event will be held Friday, September 22, at The

Dan Rodliff Vice President, NFP P&C PO Box 2243 South Burlington, VT 05407 Or Email: dan.rodliff @nfp.com

Erin Odell Odell Insurance Agency VIAA Convention Chair and Incoming President

Free Legal Consultation for VIAA Members – Up to 30 minutes

We are honored to have David Walker (former Big I Chairman) back with us all the way from Michigan to educate our members about fraud and meet ethics standards in our industry.

The Young Agents Committee will host the Wild Bunch Casino Night. The entertainment will start early with a Mechanical Bull for those that are brave enough to saddle up.

Please send your resume to:

KEIDEL, WELDON & CUNNINGHAM, LLP Attorneys at Law

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Producer Agreements

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Contact: James Keidel, Managing Partner jkeidel@kwcllp.com|914.948.7000 Bar Admissions: Vermont, New York, Connecticut, New Jersey, North Carolina

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On the Hill Federal Proposal Would Cut Insurer and Agent Compensation

By Jennifer Webb As Congress seeks to reform the NFIP before it expires on Sept. 30, Republicans on the U.S. House of Representatives Financial Services Committee released a summary of the key provisions to be included in flood insurance reform legislation. One provision would establish a mechanism for capping compensation for WYOs at no more than 25%.

Currently, WYO companies receive 31.9% of policyholder premiums before various federal fees and surcharges are added to administer the NFIP. From that amount, WYOs pay about half to agents, in addition to paying vendors, state premium taxes and other costs.

While the document does not provide additional details or outline a specific cap on agent commissions, such a deep cut to WYO compensation is expected to significantly impact agent commission levels, as it will force carriers to reduce costs. The Big “I” is concerned that such a drastic cut to the WYO program will limit the delivery mechanism for flood insurance and ultimately force insurers and agents to leave the WYO program—potentially limiting consumer access to the NFIP. Generally, the summary states that the legislation would reauthorize the NFIP for five years and focus reform efforts on affordability issues, private market growth, mapping, mitigation, solvency of the NFIP and claims processing. However, the summary does not include substantial detail, so it is unclear how many of the provisions will impact the NFIP and insurance agents if they were to become law.

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The summary states that legislation will likely seek to: • Phase out NFIP coverage for residential structures where the replacement cost exceeds $1 million, subject to the local availability of private-sector flood insurance after four years.

• Prohibit the NFIP from selling new coverage for structures being built in the highest-risk areas, subject to the local availability of private-sector flood insurance after four years.

• Prohibit the NFIP from making coverage available for any property where the aggregate amount in claims payments exceeds twice the amount of the replacement value of the property.

• Lower the cap on individual policyholders’ annual rate increases for Pre-FIRM residences in the Special Flood Hazard Area from 18% to 15%, but increase the minimum required annual rate increase to 8%.

• Clarify that a private flood policy can satisfy the mandatory purchase requirement for flood insurance and NFIP continuous coverage requirements.

NFIP reforms. Draft legislation to reauthorize the NFIP by Sens. Bill Cassidy (R-Louisiana) and Kristen Gillibrand (D-New York), which does not include cuts to agent compensation or the WYO reimbursement rate, is also circulating in the U.S. Senate. However, they have not yet introduced it, and additional Senate legislation is expected. The Big “I” will continue

advocating against cuts to the WYO program and any reforms that would negatively impact consumer access to flood insurance.

Jennifer Webb is Big “I” federal government affairs counsel.

• Clarify the rules regarding frequently flooded properties, including barring certain properties from the program.

The summary also states that the legislation would seek to build upon efforts already underway at the NFIP, such as reforming rating procedures and allowing for mid-term cancellation refunds if private coverage has been secured.

The Big “I” anticipates that the House will introduce legislation to reauthorize the NFIP soon, and that it could serve as the basis for any potential 9

Feature Article Update Your Operating Systems to Prevent Ransomware

By Ron Berg Attacks By now, you’ve probably heard about the new ransomware called WannaCrypt— also known as “WannaCry”—that has been making the rounds since last Friday. Codenamed “EternalBlue,” this worm is a remote code execution attack that takes advantage of a Windows vulnerability.

WannaCrypt’s impact on the U.S. has been relatively low compared to the rest of the world—so far. Still, the Agents Council for Technology (ACT) strongly encourages you to

take the necessary precautions and update your operating systems. Back in March, Microsoft issued a patch to cover this attack for systems such as Windows XP and Windows 7.

If you have Windows XP, upgrade to Windows 10. Older systems are more vulnerable, so administrators who are trying to save money by sticking with them usually run greater risks.

And while this particular attack did not target Windows 10 users, we could all afford to invest in a cyber hygiene program.

The ACT Security Issues work group is developing its focus areas for 2017 into 2018. Stay tuned for updates!

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GIVE TO InsurPac TODAY – InsurPac WORKS FOR YOU! The VIAA Board of Directors has set a stretch-goal for InsurPac this year.

Our goal is $8800. Please help us meet that goal today.

A reasonable investment today helps protect your bottom line tomorrow.

GIVE TO InsurPac TODAY – InsurPac WORKS FOR YOU! Questions? Please contact: Paul Kendall, Vermont InsurPac Chair, Lawrence & Wheeler, 802.885.2178 Mary Eversole, Executive Director, VIAA, 802.229.5884 Nathan Riedel, InsurPac, Big “I”, 202.863.7000

All forms of payment must be by personal check, credit card or non-incorporated LLC or Partnership check. Contributions or gifts to InsurPac are not deductible as charitable contributions for purposes of federal income tax. Federal law requires us to use our best efforts to collect and report the name, mailing address, occupation and employer for each individual whose contributions aggregate in excess of $200 in a calendar year. Your contribution should be considered strictly voluntary.

Department of Financial Regulation Vermonters receive $460,000 in restitution from LPL Investment Settlement is result of nationwide NASAA investigation

MONTPELIER – Michael S. Pieciak, commissioner of the Department of Financial Regulation (DFR), announced a settlement today in which LPL Financial (LPL) will reimburse $460,000 to eight Vermont investors and has paid the state a penalty of about $11,000. The settlement was the result of a multi-state investigation conducted by the North American Securities Administrators Association (NASAA).

The investigation revealed that LPL agents did not comply with certain standards when selling non-traded real estate investment trusts (REIT) between January 2008 and December 2013. Specifically, the investigation found LPL agents often failed to adequately consider an investor’s net worth and income in determining the suitability of the REIT investment. LPL also failed to provide adequate supervision over its agents as this conduct was contrary its own policies.

Pieciak said non-traded REITs can be a risky investment and often difficult to liquidate.

“Non-traded REITs do not have an active secondary market, which can put investors in a bind if they need immediate access to their 14

money,” he said. “accordingly, these investments are only appropriate for certain individuals.”

“This investigation has been ongoing for several years and the settlement with Vermont is good news for our investors,” Pieciak said, “It is also a great example of how NASAA coordinates the efforts of all state regulators to protect investors.”

The restitution to Vermonters ranges from $14,000 to $200,000. More than 2,000 investors were affected nationwide.

LPL Financial, founded in 1989 by the merger of brokerage firms Linsco and Private Ledger, is headquartered in Boston and employs more than 14,000 financial advisors throughout the U.S.

being independent doesn’t mean going it alone.

When you work for yourself, you make your own success.

But that doesn’t mean you can’t get help along the way.

That’s why Safeco offers programs and services that position you to win. From producer-development and agency-training programs to Bricks & Clicks™, Customers for Life™, and 24/7 Gold Service™ call center support, we’re there.

Reach out to your Territory Manager or Agency Specialist, or visit Safeco.com, to learn more.

The audience for this information includes insurance agents and brokers nationwide and is therefore general in nature. Every agent and broker is responsible for knowing the guidelines and laws that govern rating, underwriting, and claims handling in their states.

Coverages and features not available in all states; see the Product Guide(s) for details.

Members from the Young Agents Committee traveled down to Washington D.C.in May this month to lobby our congressional delegation.

the reforms that are being considered include increased use of mitigation practices, updated mapping technologies and the purchase of reinsurance to spread taxpayer risk. We also shared our support for a bill that would allow private flood policies to satisfy the mandatory purchase requirement for flood insurance.

Our group included from the VIAA, Executive Director Mary Eversole and National Director Ron Bixby and from the YACs, Chair Brady Hecht, Vice Chair Aislyn Vaughn, Secretary Kody Lyon, Treasurer Kelly Schavone, Legislative Chair Michael O’Leary and Member Ian Sutherland.

The NFIP has a debt of over $24 billion, largely due to Hurricane Katrina and Superstorm Sandy.

For more than two decades, up until the 2005 hurricane season, no taxpayer money had been used to support this program. There has been considerable discussion in Congress on the role of agents and their compensation levels. We explained how time intensive and complicated the program is to sell and how critical we are in the process. Lastly, we have asked that state mapping be considered in flood zone determinations, as they are more up to date than the NFIP mapping, which was last updated post Irene.

We spent our day on the Hill meeting with Congressman Welch and his Legislative Assistant Isaac Loeb; Maggie Gendron, Legislative Assistant with Senator Leahy’s office; and Alex Beaton and other staff members from Senator Sander’s office.

Flood Insurance We lobbied for a 10-year reauthorization of a reformed National Flood Insurance Program before it expires on September 30th. Some of

Health Insurance On the day that we met with our Congressional delegation, the U.S. House passed the American Health Care Act. In fact, Congressman Welch left the floor for 30 minutes to meet with us!

We urged Congress to protect the employer

©2017 Liberty Mutual Insurance AP 300783 SMART2 2017/01

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sponsored health care system in any reforms being considered. We asked them to support and co-sponsor the ‘Cadillac tax’ repeal bill (S. 58/H.R. 173). The ‘Cadillac tax’ assesses a damaging 40% tax on health plans that exceed a fixed annual cost which is expected to be less than $11,000 per year for an individual when the law goes into effect on 2020.

We lobbied against the idea that is being considered in Congress to tax employees on the now 18

tax exempt cost of their health benefits if the benefits exceed a certain threshold set by Congress. This proposal would have a similar effect as the ‘Cadillac tax’ to discourage employers to offer health plans to their employees.

Taxes We urged our legislators to reform small business and individual rates along with corporate rates in tax reform efforts. Since the majority of

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independent agencies are small business passthrough entities (subchapter S corporations, partnerships, sole proprietorships) that file at individual rates, by reforming only corporate rates would further create an uneven playing field for our members.

premium incentives on the Crop Insurance Program in the 2018 Farm bill.

We also advocated for assurances that the private sector will remain the primary distribution force of the flood program.

With 60 breweries here in Vermont we encouraged our representatives to bring malt barley back to the state. This would allow brewers to locally grow malt barley and have their products 100% Vermont made.

Insurance Regulatory Reform We shared how the Big I remains dedicated to preserving the state-based system of insurance regulation. We asked our Congressional delegation to significantly restrict or eliminate the Federal Insurance Office which was created by the Dodd-Frank financial services reform law.

FIO has proven to have questionable value for the insurance market and consumers and could evolve into a regulatory force on the federal level.

WE WOULD LIKE TO THANK VIAA COMPANY PARTERS FOR THEIR ON-GOING SUPPORT OF THE YACS. We extend a special thank you to the following YAC scholarship fund donors. Our trip would not have been possible without their funding.

LEADERSHIP PARTNER

PERPETUATION PARTNERS

Crop Insurance VIAA continued to lobby our Congressional delegation against any attempts to cut or cap 20

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Feature Article

In an April 14 LinkedIn Pulse post, I quoted an excerpt from Seth Godin’s blog that was related to the issue of online insurance buying.

I got so much response to that LinkedIn posting excerpt that I asked, and received, Seth’s permission to reprint it here in its entirety.

You’ll find it below.

(purchasing insurance) is to just reduce it to a phone app with a 2-3 minute processing time.

The problem is, as Seth puts it, we are often swayed by short-term comfort and ignore longterm implications. As an insurance professional, it is your responsibility to educate consumers that shortcuts like this can result in financial disaster if they do not take the time to ascertain their exposures to loss and address them.

Seth characterizes himself as someone who “writes about the post-industrial revolution, the way ideas spread, marketing, quitting, leadership and most of all, changing everything.” I find that much of what he blogs about can be applied to our industry.

Bad decisions happen for one of two reasons:

If you don’t subscribe to Seth’s daily blog, I encourage you to do so. It is almost always interesting and often very insightful. In the near future, I plan to blog about some really good blogs that I subscribe to.

1. You’re in a huge hurry and you can’t process all the incoming properly. But more common…

Now, on with the original blog post I mentioned at the start above….

More recently, he blogged about “When Time Catches Up.” Here is an excerpt from that post:

2. The repercussions of your decision won’t happen for months or years. This is why we don’t save for retirement, don’t pay attention to long-term environmental issues, and, tragically, tolerate (or fall prey to) irrational rants about things like vaccines. It might be engaging or soothing to promote a palliative idea now, but years later, when innocent kids are sick and dying, the regrets are real.

A bad decision isn’t only bad because we’re uninformed or dumb. It can be bad because we are swayed by short-term comfort and ignore long-term implications. A bad decision feels good in the short run, the heartfelt decision of someone who means well. But there’s a gap when we get to the long run.

This is related to what many of the insurtech start-ups refer to as the “customer experience.”

Their solution for what can be a painful process 24

The problem: Just because it’s easy, it doesn’t mean it’s as useful as it appears.

It’s lazy for the consumer. If you can’t take the time to learn about your options, about quality, about side effects, then it seems like buying the cheapest is the way to go– they’re all the same anyway, we think.

And it’s easy for the producer. Nothing is easier to improve than price. It takes no nuance, no long-term thinking, no concern about externalities. Just become more brutal with your suppliers and customers, and cut every corner you can. And then blame the system.

The merchandisers and buyers at Wal-Mart were lazy. They didn’t have to spend much time figuring out if something was better, they were merely focused on price, regardless of what it cost their community in the long run.

We’re part of that system, and if we’re not happy with the way we’re treated, we ought to think about the system we’ve permitted to drive those changes.

What would happen if we insisted on ‘sort by delight’ instead?

What if the airline search engines returned results sorted by a (certainly difficult) score that combined travel time, aircraft quality, reliability, customer service, price and a few other factors? How would that change the experience of flying?

This extends far beyond air travel. We understand that it makes no sense to hire someone merely because they charge the cheapest wage. That we shouldn’t pick a book or a movie or a restaurant simply because it costs the least.

There are differences, and sometimes, those differences are worth what they cost.

‘Worth it’ is a fine goal.

What if, before we rushed to sort at all, we decided what was worth sorting for?

Low price is the last refuge of the marketer who doesn’t care enough to build something worth paying for.

In your experience, how often is the cheapest choice the best choice?

Copyright 2017 by Seth Godin. All rights reserved. Reprinted with permission.

‘Sort by price’ is lazy

by Seth Godin

Sort by price is the dominant way that shopping online now happens. The cheapest airline ticket or widget or freelancer comes up first, and most people click.

It’s a great shortcut for a programmer, of course, because the price is a number, and it’s easy to sort.

Alphabetical could work even more easily, but it seems less relevant (especially if you’re a fan of Zappos or Zima).

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Are you ta king a d va nta g e of your m em b ership ?

Big “ I” Professiona l Lia b ility

www.ind ep end enta g ent.c om / EO As a member of your state association, you have access to the Big “I” Professional Liability program, the most respected and comprehensive program in the business, offering a variety of insurance agent’s E&O products that are hand-selected for their superior reputation and exceptional performance. With comprehensive rates and a long-term market, the Big “I” Professional Liability program is properly positioned to meet your professional needs, protecting the future of your agency.

Big “ I” Ma rkets

www.b ig im a rkets.c om Exclusively available to Big “I” members, IIABA’s online market access program features specialty/niche coverages, program business and hard-to-find markets. Unlike similar programs, there are no registration fees, no minimums, and you own your expirations. In many states, additional markets are available through Big “I” Eagle Agency.

Big “ I” Flood

www.ind ep end enta g ent.c om / Flood Big “I” endorsed Selective Insurance has been a Write Your Own carrier (WYO) for the National Flood Insurance Program (NFIP) since 1984 and is one of the top 10 writers of NFIP policies. Selective makes writing flood insurance easy through quality customer service and superior technology. Together, Big “I” Flood and Selective’s relationship helps deliver members an unparalleled flood program by offering state-of-the-art processing, dedicated underwriters (not a TPA call center) and localized flood Territory Managers providing you with the knowledge and expertise needed to effectively speak flood.

Big “ I” Retirem ent

www.ind ep end enta g ent.c om / Retirem ent Big “I” Retirement Services, LLC has partnered with national firms to provide a unique member-only plan that simplifies the plan sponsor’s administrative responsibilities while limiting your fiduciary exposure.

The Big “I” MEP 401(k) Plan is sponsored by Big “I” Retirement Services, LLC. It is a multiple employer plan also known as the MEP, which is a great way to lower your overall retirement plan costs while receiving consulting, helpful educational tools and low cost investment options. By partnering with Mesirow Financial, a 3(38) fiduciary and MVP Plan Administrators, a customer service oriented record-keeper, the Big “I” MEP 401(k) Plan is designed to maximize cost savings and our unique association design.

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Big “ I” Em p loyee Benefits

www.ind ep end enta g ent.c om / Em p loyeeBenefits The Big “I” Employee Benefits program provides full service group benefits for our member agents. Our program is underwritten by The Guardian Life Insurance Company of America, a multi-line insurance group with many years of experience in the business and administered by a dedicated service team just for Big “I” Members. Offering Group Life, Group Short- and Long-Term Disability, Group Dental and Group Vision, the program offers varying lines of coverage options to meet the diverse needs of our members and also provides guaranteed issue with certain requirements being met. Whether you are a new member or an existing one, we quote and add coverage on a continuous basis.

Big “ I” Persona l Um b rella

www.ind ep end enta g ent.c om / RLI RLI’s PUP stands atop the existing homeowner and auto insurance to provide an extra layer of personal liability protection for the insured and their family. With RLI’s PUP program, the insured can maintain their auto or home coverage with any company they choose, provided they agree to maintain the mandatory minimum underlying coverage limits. Limits up to $5 million ($1M in NM) and UM/UIM coverage available.

Big “ I” Hom e Business

www.ind ep end enta g ent.c om / Hom eBusiness RLI’s Home Business Policy provides affordable coverage for those people who operate small home-based businesses. Insureds often believe their existing homeowners or apartment-dwellers policy will cover any loss or damage to their business equipment, furniture and supplies in the event of fire, theft or other catastrophe, when in fact, those policies usually explicitly exclude coverage for any business exposures on their premises. Partner with us to offer this important coverage to your clients.

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www.ind ep end enta g ent.c om / Ad va nta g e Enjoy member discounts for a variety of services to assist in managing your agency. Caliper (personality testing and human resource consulting); DocuSign (eSignature); UPS (express delivery); Mines Press (printing); Virtual Risk Consultant (agency checklists and marketing tools); Hertz (rental car service); Big “I” Career Center (insurance jobs board) and more. Members are also encouraged to connect with Insurbanc, the FDIC insured bank founded by agents for agents. Visit www.insurbanc.com.

Little and Often

By Phil Schuman When opening my credit card statement at the end of the month I often look at the total and hope the bank has made a mistake. Sadly they never have, but I add up each of the small purchases and wonder how they all total that one big whopping number at the end! It recently struck me that these credit card statements are a great analogy for success in selling.

Much is made by motivational speakers on taking “massive action” to achieve your dreams. But the path to success can actually be far less dramatic and much easier. Although there is nothing wrong with taking massive action it is harder to sustain than the simple habit of “little & often.” But how does just doing a little make a big impact in sales? How can each of those small individual purchases on my credit card statement add up to such a high number?

Because I’m buying something small every single day, and over time it all adds up. The same is true in sales efforts. If we suddenly tell ourselves we have to make an additional 300 calls it seems overwhelming – but if we’re constantly chipping away and making an additional and very manageable 10 extra calls per day, by the end of the month we’ve hit our 300 calls. And if we do this on a consistent basis, by the end of the year we’ve made an additional 3,600 calls! Just by taking a small extra step each day.

This simple but profoundly powerful concept has been examined in books such as “The Slight Edge” and “The Compound Effect” – yet its advantage is often overlooked.

Think of a straight vertical line – if you never do that little extra you’ll follow the same vertical path. But do that little extra and after a day and a week you’ll have veered away from the vertical line to follow a new and greater trajectory. At first it’s nothing too dramatic and hardly noticeable. But sure enough, after a month and a quarter and a year you’ll be in a completely new place, so far away from the original vertical line, and you’ll be winning more clients, earning more money and enjoying your life in sales even more.

In addition to this new trajectory your efforts start to compound on themselves. Financial planners refer to the “Rule of 72”. It states that 72 divided by the interest rate tells you how fast the investment will double in value. The same is true in sales: the results gained from the additional daily sales efforts start to compound. This also helps us stretch ourselves – we all have a far greater capacity than we realize. Once 10 extra calls each day becomes our daily habit then we’re more easily able to extend ourselves to 15 extra calls per day. Our true potential is like an elastic band but if we don’t stretch it we’ll never know what we can really achieve.

There are so many wonderful aspects to the business of selling, but one of the greatest is that 27

it’s often not just the most intelligent person or even the most naturally gifted salesperson who achieves the greatest results in selling. It typically will come down to the one who’s prepared to do that little extra work on an unwaveringly consistent basis. “Success is the sum of small efforts repeated.”

(The reverse of compounded efforts is true as well. If you’re doing less than what is required it makes no real difference over a week or even a month – but it’s amazing in sales how quickly you can find yourself in a hole with no ladder!)

Next time you’re feeling overwhelmed at how to take that “massive action” to get you to the place you want or need to be, remember it’s really quite simple. It all comes down to getting into an unbreakable habit of doing that little bit extra every single day. But start TODAY! “A step is infinitely easier than a journey.”

Add this concept along with energy, patience and persistence into your daily sales activities and after a short period of time you’ll start to notice a dramatic difference in your sales results.

The “little & often makes much” mentality is always a winning philosophy. Unless it’s concerning your credit card statement!

Happy Selling!

The Schuman Group empowers and inspires sales teams with proven strategies and real world tools through sales training, coaching and consulting services. www.schuman-group.com

ATTEND IN VERMONT REGISTER TODAY! Commercial Lines ◆ Personal Lines These advanced seminars are open to the insurance community • Satisfies the annual CISR and CSRM CE update requirements • CE credits • Expert instruction • In-depth discussions • Networking opportunities in a relaxed atmosphere - AND NO TEST!

CLASSES AVAILABLE THROUGHOUT NEW ENGLAND REGISTER TODAY! 28

Risky Business: Insuring the Marijuana Industry

By Julie Carter The number of states legalizing the growth, distribution and possession of marijuana, in one form or another, continues to increase.

As of this writing, twenty-eight states and the District of Columbia have legalized the use of medical marijuana; eight states and the

District of Columbia have legalized the use of recreational marijuana. The cannabis market is a multi-billion dollar industry, with revenue expected to reach $20 billion by 2021. It is important to remember, the fact is that the growth, distribution or possession of marijuana is a crime under federal law.

As with any other business, those involved in the industry are seeking insurance coverage for their assets and potential liabilities, and the

opportunities for carriers, brokers and agents may seem endless. However, although laws regulating the marijuana industry (as well as the insurance industry) are controlled by individual states, the use, sale or cultivation of marijuana is a still a crime under federal law, as is the aiding and abetting of these acts. While the Obama Administration made it clear it did not intend to seek prosecution of marijuana-related activities in states where it has been legalized, Attorney General Jeff Sessions recently stated the current Administration intended to “crack down” on such activities. Therefore, any procurement of insurance for cannabis enterprises is extremely risky – both in the procurement itself and in the coverage minefields that may result in E&O claims against an agent or broker.

There are a few insurance carriers providing coverage to cannabis businesses. These businesses run the gamut from oneman operations to large companies with sophisticated technology and several employees.

These insureds are seeking the same types of coverages as many other retail and/or crop enterprises: Commercial General Liability, Business Property, Cyber Liability, Workers’ Compensation, Directors & Officers Liability, Commercial Auto, Products Liability, Pollution, 31

Everything you insure is on your shoulders Crop, Employment Practices Liability, etc.

Also, most of these businesses have a steady influx of cash on the premises, given the fact that U.S. banks are not allowed to deal with the cannabis industry because of the federal law criminalizing such activity. However, given there is not much guidance or precedence to clarify the validity of such insurance contracts and the enforceability of insurance contracts provided to marijuana businesses, many carriers are refusing to write policies for these potential clients. For example, one major world-wide carrier is not renewing policies with this type of coverage until marijuana use is declared legal under federal law.

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

www.iiaba.net/eohappens

VIAS is a subsidiary of Vermont Insurance Agents Association viaa.org

Much of the concern centers around two issues: 1) is the insuring of an illegal activity under federal law a criminal activity in and of itself, causing the insurance contract to be unenforceable; and, 2) exclusions in many standard-form policies may provide illusory coverage for an insured. Regarding the first issue, whether or not a court of law could determine that an insurance contract was void as the result of insuring an illegal activity is definitely a risk for a business and therefore, the insurance agent that procured the policy.

In addition, a carrier could potentially deny coverage for certain acts because of the federal law issue, leading to a “failure to procure” E&O claim against an agency. Regarding this issue of “exclusions,” many traditional insurance policies, exclude coverage for “illegal activities,” “criminal acts” and “intentional behavior”. Exposures such as Civil RICO claims, money laundering and reputational risk are valid concerns for those involved in the cannabis industry. Whether or not such exposures can, or should, be covered by an insurance policy is a matter of great debate within the insurance community.

Given the dichotomy between state and federal laws on the legalization issue, and conflicting court rulings regarding insurers obligations to provide coverage, there is great risk to an agent in procuring this coverage. Policies would likely not be standard ISO forms given the unique risks to these insureds and the numerous regulations the states place upon such operations. Marijuana growers and distributors are required to be licensed. The particular licenses and permits that are required depends on where the businesses are located. For example, in California, 20 types of licenses are required including permits for farmers, delivery services, testing labs, distributors, dispensary operators, etc. An in-depth knowledge of all applicable licensing issues would be required by any insurance provider.

It is important to remember, the fact is that the growth, distribution or possession of marijuana is a crime under federal law. This issue alone should weigh heavily into all other considerations for an agency tempted to enter this area of the insurance arena.

The law and the insurance industry will continue to evolve. However, for the prudent insurance agent, it is likely best to wait until the smoke clears before considering procuring insurance for a client in this field in order to avoid a potentially problematic E&O claim.

Julie Carter is an assistant vice president, claims specialist with Swiss Re Corporate Solutions and works out of the office in Overland Park, Kansas.

Insurance products underwritten by Westport Insurance Corporation, Overland Park, Kansas, a member of Swiss Re Corporate Solutions.

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FREE TURN OFF TEXTING DEMONSTRATIONS The Youth Safety Council of Vermont is now scheduling free Turn Off Texting demonstrations at Vermont high schools for the spring! Please feel welcome to reserve a date at http://www.yscvt.dreamhosters.com/request-a-tot-demo/ or, if you’re already familiar with the program, email Jim Lockridge at info@yscvt.org.

The Youth Safety Council of Vermont’s Turn Off Texting demonstration raises awareness about the dangers of distracted driving by putting Vermont students behind the wheel of a golf cart to navigate a course ofcones while texting. The demonstration comes to your school free of charge thanks to a grant from the Governor’s Highway Safety Program and the support of our program sponsors.

Calendar: viaa.org/Education/Pages Webinars: iiavt.aben.tv/

For more about the program including photos and a video, visit YSCVT.org.

Company News Acuity Projects Win Top Creative Awards Acuity announced that several of its recent marketing and educational projects have earned top awards for creativity in international competition.

The Association of Marketing and Communication Professionals (AMCP) presented Acuity with two Platinum Hermes Creative Awards, the highest awards given by the international association. One award was earned for the continuing education video Face to Face, and the second was earned for Acuity’s 2015 annual report.

concept, writing, and design of traditional materials and programs, and emerging technologies. Entries come from corporate marketing and communication departments, advertising agencies, public relations firms, graphic design shops, production companies, web and digital creators, and freelancers. The competition has grown to become one of the largest of its kind in the world.

Acuity, headquartered in Sheboygan, Wisconsin, is a property and casualty insurer that operates in 25 states, generates nearly $1.4 billion in revenue through 1,000 independent agencies, and manages over $4 billion in assets. Named one of the top 10 large companies to work for in America, Acuity employs over 1,200 people.

Face to Face highlights Acuity’s unique and innovative program that builds relationships between commercial insureds and key Acuity personnel, using custom-created puppets to tell the story of the program. Acuity’s 2015 annual report, The Year That Soared, featured a kite-shaped booklet that was packaged with a custom-printed sport kite.

“Our annual reports, CE videos, and other projects are important ways that Acuity communicates with agents, employees, and customers,” said Ben Salzmann, Acuity President and CEO. “Receiving Platinum awards demonstrates that our educational and marketing materials are fun, effective, and creative.”

Helen Collins hcollins@viaa.org

In addition to two Platinum awards, Acuity earned two Gold awards and two Honorable Mentions for other Acuity U videos. Hermes Creative Awards is an international competition for creative professionals involved in the 37

Company News

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MONTPELIER, Vermont (May 10, 2017)— Recently Vermont Mutual Insurance Group® held its 190th Annual Meeting. Over the course of 2016, Vermont Mutual Insurance Group increased its direct written premium by more than 8% to an unprecedented $434,265,941.

Additionally, policyholders’ surplus increased 10% during the year to an all-time high of $420,456,488.

“This past year stands out as one of the most successful in the 190-year history of our company,” stated Dan Bridge, Vermont Mutual’s President & CEO. Bridge continued “Our strong financial results strengthened our business for our policyholders, Independent Agency Partners and employees. We were again named one of the Top 50 property casualty insurers in the U.S. and one of the Best Places to Work in Vermont. Operational improvements and modernization efforts were significant and we remain well-positioned to meet the needs of both our Agent Partners and their customers for years to come.”

Mark McDonnell, Executive Vice President and COO, added “We continue to foster a relationship-based approach in claims, underwriting and marketing, and thankfully our Agent Partners favored us with a record level of new business of over $64 million. Our growth and strong retention is an indication that agents and policyholders are pleased with the value they receive from insuring with Vermont Mutual.”

The annual meeting also marked the retirement of J. Timothy Ide, retired president of E.T. & H.K. Ide, Inc. of St. Johnsbury, Vermont, and a member of the Vermont Mutual Directors Advisory Council. Mr. Ide was presented with

a Simon Pearce commemorative glass bowl acknowledging Mr. Ide’s more than thirty seven years of providing wise counsel to the company as both a member of the Board of Directors, and later the Directors Advisory Committee.

Service to Vermont Mutual runs in the Ide family, both Mr. Ide’s father and grandfather also served on Vermont Mutual’s Board of Directors for many decades. “I cannot thank Tim enough for the valuable service he provided our company over so many years,” stated Bridge. “A commitment of that type is truly unique and we’re very appreciative of all that Tim has done for us.”

The following officers were elected at this year’s annual meeting: Daniel C. Bridge, Chairman, President and Chief Executive Officer Mark J. McDonnell, Executive Vice President and Chief Operating Officer Richard N. Bland, Vice President, General Counsel and Secretary Susan L. Chicoine, Vice President Human Resources Joanne M. Currier, Vice President Information Technology David N. DeLuca, Vice President Claims Brian C. Eagan, Vice President, Chief Financial Officer and Treasurer Shaun P.T. Farley, Vice President Marketing Terry J. Moore, Vice President Underwriting _______________________________ Vermont Mutual Insurance Group® is a trade name of Vermont Mutual Insurance Company, Northern Security Insurance Company, Inc. and Granite Mutual Insurance Company. Chartered in 1828, Vermont Mutual is one of the ten oldest mutual property/casualty insurers in the United States and provides coverage throughout New England and upstate New York. Through more than 400 independent agencies, the Group insures 300,000 policyholders with a direct written premium of more than $420,000,000. The group is rated “A+ Superior” by A. M. Best and a Ward’s Top 50 performing property/ casualty for the past eight consecutive years.

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HELP WANTED

PERSONAL LINES SERVICE Customer Service is the top priority of this position. Efficient servicing will be required in this position in order to maintain excellent customer relations. This position will coordinate the processing of personal lines new and renewal business.

• Maintain control on renewal expirations and binders.

Essential Duties & Responsibilities:

• Manage adding coverages to existing accounts.

• Manage & prepare quotations.

• Complete and upload new business applications.

• Manage new accounts in Agency Automation System • Respond to company memos or e-mail in timely manner.

• Maintain positive relationships and keep direct communication with company underwriters and staff.

• Keep informed and up to date on industry and company issues.

• Improve/refine sales techniques through continuing education.

• Maintain account files in accordance with established procedures.

• Complete performance objectives as directed by the Manager.

• Perform other specific duties as requested by the Manager.

• Some processing on assigned accounts, including: daily mail, ordering of renewal or new coverage’s, invoicing, binders, company and/or client correspondence, suspense and follow-up, computer information input and client and/or policy information update.

• Check policies, endorsements, and other policy documents for accuracy.

• Market, quoting, and placing new and renewal risks. Set up complete policy applications and/or specifications as required for new or renewal business in conjunction with clients’ needs and in conjunction with producer instructions.

• Maintain Pipeline weekly with sold business.

• Coordinate with accounting department in collecting premiums promptly or taking action in accordance with agency credit program.

• Individual will also process any task as needed to relieve the loads of others in the department.

Education/Experience/ Licenses/Certifications • High School diploma required; college degree preferred.

• Three to five years in company or agency underwriting.

• Agency experience preferred • Property/Casualty License required Submit Cover Letter and Resume to: Robin Bilodeau robin.bilodeau@nfp.com 41

?

HELP WANTED

DID YOU KNOW AGENCY E&O UMBRELLA IS NOW AVAILABLE THROUGH BIG “I” PROFESSIONAL LIABILITY A commercial umbrella underwritten by Swiss Re (rated A+ by A.M. Best) is now available exclusively to Big “I” members.

Designed in collaboration with the IIABA to

PROTECT

your business with an E&O umbrella endorsed by IIABA

meet the needs of independent insurance agents Broad coverage over primary casualty lines,

including E&O Limits available up to $10 million over

CONSOLIDATE coverages with one carrier and avoid potential gaps

underlying primary E&O policy Will be available in 50 states and the

District of Columbia May to be written over a variety of E&O

carriers Contact your state association to learn more or to receive a quote today:

www.independentagent.com/EOContact

SECURE your agency’s future with the largest writer of agents professional liability in the country

Personal Lines Insurance Agent The Crowley Agency has been in business since 1947 providing excellent service and products to our many loyal customers. We currently have an open position for a licensed personal lines agent with the opportunity to grow into commercial lines. The ideal candidate would be personable, possess excellent communication skills and really enjoy helping people.

This is a full time postion with office hours and basic computer skills are required. We offer competeive salary, commission & benefits based on experience and qualifications.

Please send your resume to Gail McKenna at gailm@crowley agency.com For more details regarding our products and the companies that we represent, please visit our website: CrowleyAgency.com

Recognized in 2016 and 2017 as one of the Best Places to Work in Vermont, The Richards Group is an independent, full-service insurance and financial services agency who has been serving the communities of the tri-state region since 1867.

We are always looking for highly motivated individuals who have excellent customer service and relationship building skills. The Richards Group offers a competitive salary commensurate with experience as well as a comprehensive benefits package. We are actively recruiting for the following positions: • Accountant, Brattleboro

• Commercial Lines Department Manager, Brattleboro • Commercial Lines Sales Assistant, Brattleboro • Commercial Lines Sales Producer, Rutland

• Commercial Lines Account Manager, Middlebury

SUPPORT your state association while protecting your business

Insurance products underwritten by Westport Insurance Corporation, Overland Park, Kansas. Westport is licensed in all 50 states and the District of Columbia. Insurance products mentioned may not be available in all states. Please contact your state administrator or Westport for availability in your state

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Granite

Mt Mansfield Maple AmTrust North America, Inc. Travelers

Champlain Ethan Allen

Berkshire Hathaway GUARD CNA

Hanover Insurance Group

Meadowbrook TPA Associates

Imperial PFS

New England Excess Exchange, LTD

MAPFRE|USA

Main Street America

MEMIC

Johnson & Johnson

Patriot Insurance Company