March 2017

Inside this issue: 

The Eight Second Rule



115th Annual Convention & Exposition



Trade Contractors Pollution Loss Exposures



Things of value furnished by persons engaged in the business of insurance



Property Used in Connection With...

24/7 Agency Solutions

4-6

Primary and Non-Contributory Coverage on Auto, Umbrella, and Excess Policies

7-8

Revised LDI Advisory Letter

8

Hidden Environmental Loss Exposures for Trade Contractors

10-12

McCarran-Ferguson Update

12

Mike Edwards, CPCU, AAI Director of Education medwards65@aol.com

Make A Wish Bowling Fundraiser

17

115th Annual Convention & Exposition

25

Kim Jackson Education & Membership kjackson@iiabl.com

E&O Q&A

28-32

Eight Second Rule

33

IIABL STAFF Jeff Albright Chief Executive Officer jalbright@iiabl.com Francine Berendson Director of Communications & Events fberendson@iiabl.com

Karen Kuylen Director of Accounting kkuylen@iiabl.com E. Lee Mowe Marketing Representative lmowe@iiabl.com

IIABL Calendar Ask Mike

Rhonda Martinez, CIC Director of Insurance rmartinez@iiabl.com

IIABL Calendar Rate & Rule Filings

26

Jamie Newchurch Insurance Services jnewchurch@iiabl.com

Tech Tips Rate & Rule Filings

14-15 27

IIABL Partners Tech Tips

14-15

IIABL Partners

36

Lisa Young-Crooks Executive Assistant lyoung@iiabl.com

18-24 26

27

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IIABL Launches 24/7 Agency Solutions The world around you is changing faster than ever before…is your agency keeping up?

Amazing technologies, new competitors with better online tools, 24/7 providers, and rapidly changing customer expectations are only a few challenges that your agency faces.

Customers today are very different than the ones from 5-10 years ago. They demand more: they expect us to cater to their every need at a moment's notice, at any time of the day or night. We all know the challenges, but can you honestly say that your agency is keeping up with the challenges in our industry?

Do you truly offer a modern customer experience that differentiates you from your competitors? For many agencies,

the answer is “No, not even close.”

That’s why the Big I developed 24/7 Agency Solutions for our members. We want to help your agency meet the changing demands of consumers so your agency can sell and retain more customers. 24/7 Agency Solutions gives your agency important technology tools to provide your prospects and customers 24/7 service.

24/7 Agency Solutions offers your agency: 1. State of the art website design customized for your agency – make your website something that you will be proud of and something that attracts new customers.

2. Your own agency mobile app – give your customers the tools they need to manage Continued page 5

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their policies, report changes and claims, and stay connected to your agency…right on their cell phone or mobile device.

Website Design

3. 24/7/365 answering service manned by licensed professionals – a cost effective way to service your customers any time they call.

Your answer to “Jake from State Farm.”

IIABL has carefully aligned with best in class technology companies to provide your agency with 24/7 Agency Solutions.

It’s time to revolutionize your brand and meet the challenges of the future. IIABL is here to help you become a 24/7 agency - get started today!

80% of all insurance searches begin online.

Our website designers only work with independent agencies and can turn your website into a productive tool to attract new customers and service your clients.

Continued page 6

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Mobile App

Answering Service

90% of smartphone users use mobile apps to find what they need. Our mobile apps are customized for your agency and provide valuable services like auto ID cards, home inventory, policy changes and claims reporting.

34% of prospects who hang up do not call back.

When prospects call for a quote or customers need help, they do not want an answering machine. The licensed professionals at our service center can handle your business when you can’t‌at night, on weekends and holidays.

24/7 Agency Solutions Questions Contact Ewa Telenga, 24/7 Agency Solutions Advisor etelenga@247agencysolutions.com (888) 275-8911 Continued page 7

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Primary and NonContributory Coverage on Auto, Umbrella, and Excess Policies Bill Wilson, CPCU, ARM

Although I’m no longer a staff member of the Big “I”, I continue as a volunteer faculty member of the Virtual University. About three weeks ago, an agency member submitted a question about primary and noncontributory coverage on umbrella policies. It was his impression that you could not add AI status on a primary and noncontributory basis to umbrella and excess policies, but an underwriter told him that, if such status is provided on the underlying policies, it extends to umbrella/ excess policies. His concern was that the underwriter had told him things in the past that later were determined to be incorrect.

On this question, how an umbrella or excess policy responds depends on the language in the form in question. Never assume or generalize. While umbrella and excess policies often extend AI status, whether such status is extended on a primary

and noncontributory basis may depend on the policy language or statutory or case law dealing with issues such as horizontal vs. vertical exhaustion of limits.

That being said, in 2016 ISO introduced primary and noncontributory endorsements for both their umbrella and excess policies (and their BAP): CA 04 49 11 16 – Primary And Noncontributory – Other Insurance Condition CU 24 78 11 16 – Noncontributory – Other Insurance Condition CX 24 33 11 16 – Noncontributory – Other Insurance Condition These changes were introduced at the request of the Big “I” Technical Affairs Committee and/or the Big “I” Mid-American Insurance Conference (www.matcinsurance.com) to address the vertical vs. horizontal exhaustion requirement in an increasing number of construction contracts. ISO has already done this in 2013 for the CGL program with their new CG 20 01 endorsement.

Continued page 8

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From page 8

So, absent any overriding extra-contractual law to the contrary, these endorsements can now be used

by ISO subscribing carriers to comply with contract requirements to provide primary and noncontributory coverage on CGL, BAP, and CUP/excess policies.

Bill Wilson, CPCU, ARM, AIM, AAM Founder & CEO, InsuranceCommentary.com Bill@InsuranceCommentary.com or InsuranceCommentary@outlook.com

Com•men•tar•y … an expression of opinions or offering of explanations William C. Wilson, Jr., CPCU, ARM, AIM, AAM is the founder of InsuranceCommentary.com. He retired from the Independent Insurance Agents & Brokers of America in December 2016 where he served as Assoc. VP of Education and Research and was the founder and director of the Big “I” Virtual University for over 17 years. He is the former Director of Education & Technical Affairs for the Insurors of Tennessee and, prior to that time, he was employed by Insurance Services Office, Inc. He is a graduate of the Illinois Institute of Technology with a B.S. degree in Fire Protection & Safety Engineering.

comply with or contravene the Unfair Trade Practices Act. Advisory Letter No. 2015-01 (revised) describes a number of practices that constitute "value added" services, and distinguishes between "value added" services that violate the rebating provision of the Unfair Trade Practices Act, La. RS. 22: 1964(8), and "value added" services that do not.

The primary changes in the Revised Advisory Letter 2015-01 are found in section C. Services Offered to the General Public. LDI added the following guidance: To determine whether a thing of value has been offered to the general public, the LOI will consider the circumstances surrounding the offer, including but not limited to the following factors: 1. Whether the offering of the thing of value is open and obvious to the general public.

2. Whether the offering is directed primarily to insureds or prospective insureds.

LDI Reissues Advisory Letter 2015-01 On Value Added Services Louisiana Department of Insurance Advisory Letter No. 2015-01, originally issued on June 3, 2015, has been revised and re-issued in order to clarify prior guidance regarding services offered to insureds and services offered to the general public. The purpose of Advisory Letter No. 2015-01, revised March 14, 2017, is to inform all insurers, producers and brokers of the rescission of Bulletin No. 2010-05 and to clarify prior guidance relative to "value added" services or things of value furnished by persons engaged in the business of insurance, as well as to common and ordinary marketing practices. Advisory Letter No. 2015-01 (revised) relates directly to the enforcement of the Unfair Trade Practices Act, La. RS. 22:19611973, which defines and prohibits acts, methods, and practices that constitute unfair methods of competition and unfair or deceptive acts in the business of insurance. Advisory Letter No. 201501 (revised) should not be regarded as containing exhaustive examples or lists of conduct that either

3. Whether a member of the general public is able to obtain the thing of value on equal terms and through the same means as insureds or prospective insureds.

4. Whether any impediment to access the thing of value exists that is imposed on the general public and not equally imposed on an insured or prospective insured.

Please click here to review REVISED LDI Advisory Letter 2015-01.

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Hidden Environmental Loss Exposures for Trade Contractors

By Dan Scheider Trade Contractors have pollution loss exposures that are often left unaddressed in insurance programs.

Today’s CGL policies commonly contain separate exclusions for silica, mold, bacteria, asbestos, and lead, in addition to pollution exclusions. The new exclusions address indoor air exposures too. The only way to adequately protect your insured from these exposures is via a well designed contractor’s pollution liability policy (CPL).

The insurance designers now at ARMR invented CPL insurance in 1986, we know a lot about the product line. CPL was not originally designed for the newly excluded indoor air loss exposures. Modifications to the CPL policy form are usually necessary. By not addressing these exposures you leave both your agency’s E&O and your insured at risk.

Some CGL carriers offer limited scope job site pollution endorsements. These endorsements are not the same as a Contractors Pollution Liability policy and

should never be shown on a insurance certificate as such. While coverage extensions to the GL are better than a total pollution exclusions, after a loss it is too late to determine whether a CPL would have better protected your insured.

It is often thought that only contractors involved in environmental or pollution cleanup need CPL coverage. However, trade contractors have the following gaps in coverage caused by the exclusions found in their CGL policies.

Plumbers (Mold, Bacteria, Category 3 water) What happens when a plumber’s work goes wrong?

Water damage caused by leaking pipes can lead to mold growth within 36 hours Category 3 water (water in a drain pipe) as sewage backups/leaks is considered a pollutant plus bacteria is now excluded specifically. Category 3 water is Category 3 because of the bacteria in it.

Continued page 11

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From page 10

HVAC Contractors (Mold, Bacteria, Legionella) Condensation in HVAC systems can lead to mold/Legionella issues (bacteria) Installing HVAC systems that cause too much humidity can cause mold growth Roofing Contractors (Mold, Lead, Asbestos) Leaky roofs can lead to mold growth Working on older buildings increases the chance of lead & asbestos exposure Electricians (Mold, Lead, Asbestos) Electrical, while running wire above a ceiling a contractor steps on a sprinkler pipe hidden by insulation, causing water damage which results in mold damage. Working on older buildings increase the chance of lead & asbestos exposure

Concrete Contractors (Silica Dust) Operations creating concrete/cement dust or silica dust (Ruled a pollutant in Texas, South Dakota, and Hawaii) Carpentry/Drywall Contractors (Lead, Asbestos, Silica Dust) Working on older buildings increase the chance of lead & asbestos exposure.

The spread of silica dust during drywall construction.

ARMR Brokers can give you rough pricing benchmarks with just a description of the contractors operation and their total gross revenue.

Markets: 18 environmental insurance markets with A or higher A.M. best ratings, admitted and nonadmitted forms Premium: Minimum premiums start at $2,500 ($1MM/$1MM limits)

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Continued from page 11

Want to boggle your mind on pollution exclusions plus develop some production tools? See hundreds of litigated claims In the Munich RE Environmental Coverage Case Law Guide @ http://www.armr.net/EnvClaimsguide2011.pdf Fun Pollution Facts from the Munich RE Environmental Coverage Case Law 21st Edition Manure has been ruled a pollutant in Wisconsin, New York, and Iowa Lead Paint has been ruled a pollutant in Wisconsin but not in Illinois Sewage has been ruled a pollutant in Florida but not Alabama E. Coli Bacteria has been ruled a pollutant in California but not in New York

Remember in each case there was a mighty unhappy client for an agent to deal with for the claim to be mentioned this book.

ARMR makes dealing with the environment loss exposures of your clients easy by providing assistance the evaluation of your client’s environmental loss exposures , a review of the pollution exclusions in the current policies and designing an insurance program that fits the customers environmental insurance needs.

This product is available on Big "I" Markets (www.bigimarkets.com/<http:// www.bigimarkets.com/> "Product Name" [Environmental Impairment - Pollution].

Commissions average 10% but vary by product.

Members can submit a risk on Big "I" Markets or for general pre-submission inquiries or questions please contact: Dan Scheider, Assistant Vice President, American Risk Management Resources Network, LLC, Scheider@armr.net Direct: 608-8369833, Cell: 608-345-1935, Fax: 608-836-9565

BIG “I” QUESTIONS MCCARRANFERGUSON REPEAL EFFORTS House passes legislation to roll back the antitrust exemption for health insurance.

The Independent Insurance Agents & Brokers of America (IIABA or the Big “I”) today expresses concern over the U.S. House of Representatives’ passage of H.R. 372, the “Competitive Health Insurance Reform Act of 2017,” by Rep. Paul Gosar (R-Arizona).

H.R. 372 would repeal the limited antitrust exemption for health insurers established by the McCarranFerguson Act. “Passage of H.R. 372 could led to a slippery slope for non-health lines of insurance such as property and casualty insurance, and life insurance,” says Robert Rusbuldt, Big “I” president & CEO. “H.R. 372 seeks to repeal the limited antitrust exemption for health insurers, but there’s an inherent problem with the bill because if the exemption is rolled back for one line of insurance, why not others?”

Pursuant to McCarran-Ferguson, state regulated insurance companies hold a limited exemption from federal antitrust laws. One of the main benefits of the exemption is that it allows insurers to share information on insurance losses so that the insurance industry can better project future losses and charge actuarially based prices for their products. The ability to pool data actually serves to increase market competition by giving small insurers access to large data sets that are needed to appropriately rate insurance products.

“The Big ‘I’ strongly supports state insurance regulation and the limited antitrust exemption for the insurance industry under the McCarran-Ferguson Act,” says Charles Symington, Big “I” senior vice president for external and government affairs. “The exemption is vital to the competitiveness of state property and casualty insurance markets, and the Big ‘I’ will continue to be vigilant in reminding Congress of this key point.”

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Manage All Agency Insurance Company Information in One Place Providing the best experience to your prospect and client requires you to maintain a large amount of information from each insurance company representative. For you to create the best insurance program possible, you need to know which carrier has the best coverage, risk appetite, and claims process.

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It does not stop there. Keeping track of each carrier agency portal login information, carrier specific forms and applications, and the right contact person is a challenge. Some agency management systems allow you to add carrier information, but my experience has been the process is not very seamless and userfriendly.

Agent Ave might be a solution worth exploring.

Agent Ave is an online platform that allows you to manage carrier information in a centralized place that is accessible to all employees and can be easily updated with changed information. The platform allows you to manage the following information: Underwriting Guidelines: Once added, each carrierâ&#x20AC;&#x2122;s underwriting guidelines is available through a simple search for a particular topic. Specific carrier guidelines are listed in the search results.

Contacts: Add and manage all contacts for a particular carrier.

ID/Passwords: A centralized place to manage individual user ID and password for each carrier.

Documents: Upload any carrier documents (forms, applications, contracts) that you want employees to be able to access.

Track Submissions: Adding information about submissions sent to the carrier will allow you to create reports that track sales and commission earned by each carrier.

Procedures: You can add carrier-specific procedures for how to complete activities or processes.

Agency Manual: Keep all agency-specific procedures in one place. This section also allows the agency to manage changes and updates to agency procedures centrally.

Quote Sheets: Enter prospect information real-time sheets.

I realize that many agencies have already tackled this particular issue and have a platform that allows them to manage this information effectively. But, if you have not yet created a solution, Agent Ave could be an effective option to get up and running quickly.

A free starter version is available for one user so you can check out the features to see how it might work for you. The Pro Plan is $12.99 per user per month.

You pay for only the users you require.

Check out their 3 ½ minute demo: https://youtu.be/4hFCFlPjaUE What have you found to be an effective way to manage all the carrier information in your agency? What tools do you use?

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5th Annual

IIABL Trusted Choice® Bowling Event Benefitting What a great way for independent agents, insurance companies, brokers and vendors to raise money for a great charity!! All proceeds from this fundraiser will be used to make a wish for Louisiana children. Your generous support continues to make this a great event & fundraiser!

Register today!!!

TOURNAMENT LOCATIONS & DATES Shreveport/Bossier City

Monroe

April 28, 2017 * 7pm—9pm Holiday Lanes 3315 Old Minden Road

April 28, 2017 * 7pm—9pm Bayou Bowling 100 Horseshow Lake Road

Baton Rouge

Lafayette April 28, 2017 * 7pm—9pm Lafayette Lanes 2825 Johnston St.

New Orleans

April 28, 2017 * 7pm—9pm Allstar Lanes

April 20, 2017 * 7pm—9pm Mid-City Lanes—Rock N Bowl

REGISTRATION (Up to 6 bowlers per team) T-Shirts will be given to all registrants who register by April 7, 2017.

TEAM NAME: BOWLERS with T-Shirt Size ($50.00/person):

NON-BOWLERS:($25.00/person)

AGENCY/COMPANY: ADDRESS: CITY/STATE.ZIP:

# of Bowlers # of Non Bowlers Total:

@ $50.00 ______ @ $25.00 ______ $ _______

TEAM CONTACT: Please make check payable & return to: IIABL 18153 E. Petroleum Dr. Baton Rouge, LA 70810

IIABL Director of Education, Mike Edwards is your source for technical questions. Contact Mike at medwards65@aol.com or 678.513.4390

Subject: Is A Newly Acquired Adjacent Premises Automatically Covered Under HO?

Q. I just learned that my insured recently in-

herited12 acres of land that is adjacent (actually, on the other side of the highway) to his home, which is rural and sits on 8 acres. This came to light as a result of the annual renewal letter we send to all of our insureds. We call it our â&#x20AC;&#x153;howdy letter.â&#x20AC;? In it, we thank them for allowing us to be their insurance agent, and we ask a few questions to help us determine if there have been any important changes since the inception of the current policy.

He called our agency in response to our renewal letter, and told me about inheriting the land from an uncle who had been ill for years, and living with a relative in another state. The only struc-

ture remaining on the property is a cavernous old barn, which had been boarded up since his uncle moved in with relatives. Inside, he found a 1953 Ford Jubilee tractor, along with lots of miscellaneous farm tools and equipment.

He has been tinkering with the old tractor for months, and finally got it running a few weeks ago. He told me he took it for a test run around the property, and a few days later, he attached the bush hog and mowed the grass around his own house. Of course, this means he drove the tractor across the highway from the barn to his house! When I got off the phone, my heart was palpating.

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But after I read the homeowners policy, I’m thinking that maybe the land he inherited would be covered as a “property used in connection with” his residence. Thoughts?

A. First, my hat is off to you for consistently

sending renewal letters to your insureds. With the intense pricing pressure from competitors old and new, staying in touch with insureds, and helping to solve problems preemptively, usually pays dividends for the agency and the insured. Also, while these new “disruptors” in insurance offer to provide quotes online, with minimal questions and in a few mouse clicks, I wonder how they would handle the complex exposures that are inherent in your insured’s situation? This is where good independent agents can show their real value.

For the discussion below, assume your insured is Jack, and he has an ISO Homeowners Policy. Excerpts and comments are based on the ISO (Insurance Services Office) forms and endorsements. Proprietary forms may be different.

Issue #1: Exposures from the inherited land. Whether or not the 12 acres across the street are automatically covered under Jack’s HO policy is a crucial issue. This governs any claims that might arise out of the land itself, as well as some of the exposures from the use of the tractor.

HO 00 03 05 11 Homeowners 3 – Special Form Definitions 6. "Insured location" means:

a. The "residence premises"; [See Defini-

tion 11 below.]

b. The part of other premises, other structures and grounds used by you as a residence; and (1) Which is shown in the Declarations; or (2) Which is acquired by you during the policy period for your use as a residence;

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c. Any premises used by you in connection with a premises described in a. and b. above; e. Vacant land, other than farm land, owned by or rented to an "insured"; 11. "Residence premises" means: side;

a. The one-family dwelling where you re-

b. The two-, three- or four-family dwelling where you reside in at least one of the family units; or

reside;

c. That part of any other building where you

and which is shown as the "residence premises" in the Declarations.

"Residence premises" also includes other structures and grounds at that location.

Section II Exclusions E. Coverage E – Personal Liability And Coverage F – Medical Payments To Others Coverages E and F do not apply to the following: 4. "Insured's" Premises Not An "Insured Location" "Bodily injury" or "property damage" arising out of a premises: a. Owned by an "insured"; b. Rented to an "insured"; or

c. Rented to others by an "insured"; that is not an "insured location"; Comments: (1) I do not think the 12-acre tract would be considered a part of the “residence premises,” given that the inherited land would have a separate legal description.

quired premises, I doubt many insurers would consider it “used by you as a residence.” Note also that this provision only applies to such premises “acquired during the policy period.” So even if Jack inherited the land during the current policy term, that automatic coverage has a limited shelf life.

(3) Definition 6.c. is one of those provisions that falls into the same category as beauty, since both are “in the eyes of the beholder.” While insurance case law seems decidedly mixed, a substantial body of court decisions interprets this provision very narrowly.

(4) Definition 6.e. applies to certain types of vacant land. Obviously, the presence of the barn eliminates any chance of the 12 acres being considered “vacant.” However, even if there were no manmade structures on the land when he inherited it, that’s not to say that Jack wouldn’t build something, even something as innocuous as a fence, at some time in the future. And it’s doubtful that when he installs a fence or well, etc, 2 years from now, he will think to call you.

(5) As with all definitions in any insurance policy, each must be read in the context of how it is used. Homeowners Section II excludes any premises owned by, rented to, or rented by Jack, that is not an “insured location.” [See Exclusion E.4. above.)

Possible solutions: (1) There is no silver bullet, or one size fits all solution, for this problem. Insurers vary in their appetite for this exposure.

(2) One option is to amend the description of the “residence premises” on the Declarations page to include the second parcel. Generally, no endorsement is used, but there may or may not be an additional premium.

(3) Jack could possibly have the legal description of both properties revised to become one single parcel, and therefore both parcels would automatically be the “residence premises.”

But this has potential issues, such as inheritance, resale, and other legal and financial considerations, which Jack should discuss with his attorney and financial advisor.

[See Definitions 6.a. and 11. above.]

(2) While Definition 6.b.(2) applies to a newly ac-

Continued page 22 Louisiana Agent 20

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(4) Some insurers will cover certain owned premises away from the residence premises as “additional insured locations” for Section II. The address or description of the additional premises is shown on the Dec page, and there is an additional premium.

(5) If none of these options are viable, the only other avenue is to procure a separate policy covering the 12 acres, preferably with the same insurer. If nothing else, that would make it easier to get a personal umbrella policy covering both locations.

Issue #2: The tractor – liability exposure.

The ISO HO broadly excludes liability coverage for defined “motor vehicles.”

HO 00 03 05 11 Homeowners 3 – Special Form Section II – Exclusions A. “Motor vehicle liability” 1. Coverages E and F do not apply to any "motor vehicle liability" if, at the time and place of an "occurrence", the involved "motor

vehicle":

a. Is registered for use on public roads or property; b. Is not registered for use on public roads or property, but such registration is required by a law, or regulation issued by a government agency, for it to be used at the place of the "occurrence"; 2. If Exclusion A.1. does not apply, there is still no coverage for "motor vehicle liability", unless the "motor vehicle" is:

b. Used solely to service a residence; Definitions (applicable to Sections I & II) 7. "Motor vehicle" means: hicle; or

a. A self-propelled land or amphibious ve-

b. Any trailer or semitrailer which is being carried on, towed by or hitched for towing by a vehicle described in a. above.

Comments:

Continued page 23

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(1) Definition 7 (immediately above) clearly applies to full-size tractors such as a 1953 Ford Jubilee tractor, as well as residential-size lawn tractors, and the smaller riding lawn mowers.

(2) However, there is an exception to the exclusion for certain motor vehicles used for “service.” [A.2.b.]

(3) Note that the exception applies only if such service vehicle is used “solely to service a residence.” In Jack’s situation, using the tractor to mow any areas of the 12 acres is not servicing “a residence.” But if the parcel is added to the definition of “residence premises” (discussed above), the exception to the exclusion would apply, and Jack would have liability coverage, since both parcels of land would be considered his “residence premises.”

(4) But if the 12 acres is added as an “additional location for Section II” (discussed above), then if he has used the tractor on that parcel, and later mows the grass at his 8-acre homesite, there would be no liability coverage, since the tractor wasn’t used “solely” to service “a residence.”

ing of terms, consider how ISO has amended this provision in previous editions of their HO coverage forms:

Section II Exclusions Motor Vehicle Liability HO 00 03 05 11: Used solely to service a residence.

HO 00 03 10 00: Used solely to service an "insured's" residence.

HO 00 03 04 91: Used to service an "insured's" residence.

HO 00 03 04 84: Used to service an insured’s residence.

Possible solution: Purchase a specialty policy, per-

haps using a Farm or other specialty program coverage form. Caution: Some tractor collectors and hobbyists drive their tractors in parades, or at exhibits, hay rides at festivals, etc. This should be discussed with Jack, and additional liability insurance might be required.

(5) To add to the complexity and frustrating parsContinued page 24

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Issue #3: The tractor –property exposure.

Are You Sure?”

(1) Coverage C for service vehicles such as a tractors and riding lawn mowers tracks the provisions discussed for tractor liability. [See above.]

“Homeowners Coverage Gaps? Here Are Some Mower.”

(2) My brother-in-law owned a 1953 Ford Jubilee at one time, and said it is a favorite of collectors and hobbyists. But given its vintage, the tractor may not be subject to replacement cost, which does not apply to “Memorabilia, souve-

“No Coverage for Riding Mower Until It’s Actually Used?”

nirs, collectors’ items and similar articles, whose age or history contribute to their value.” I

checked some websites, and saw quite a few 1953 Ford Jubilees for sale. The price range ran from $1,450 (“not running”), to $15,000 (“great condition…must see”). This is the perennial problem with valuing property like this: neither replacement cost nor actual cash value would be viable. So like any other collectible, an appraisal and a specialty policy is probably the best way to insure it from a property standpoint.

“Insuring Lawn Tractors Used Off Premises”

“Insuring High-Value Lawn Equipment” “What Does ‘Used in Connection With’ Mean”?

“What Is ‘Vacant Land’?”

“Vacant Land”

These materials are intended for educational purposes only and should not be relied upon as legal advice. Please consult a qualified attorney for legal advice.

Additional information: “Are Riding Mowers Covered by the HO Policy?

Continued page 25

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Oceans of Opportunity I spoke to a long time member today in regards to live continuing education courses. He mentioned that he really gets so much out of going to live courses but that we were not offering as many as we had in the past. My response...Waves of Change. The on-line CE market has forced us to scale back our live education seminars.

The next thing he said to me was that he could go to the convention to get live CE courses and that he has never been. I seized the moment to explain to him the value of attending the IIABL Convention.

1) Quality CE program with outstanding instructors 2) Updates from the Commissioner of Insurance 3) IIABA representative to keep us up-to-date on the national scene 4) So many opportunities to network with companies, brokers, vendors, fellow agents and the list goes on

If you have never attended the IIABL convention I encourage you to make a priority this year!

Our outstanding program this year includes:



Ron White-Triple Your Memory, Triple Your Business



Virginia Bates: Serious Insurance Games Improving Your Revenue Stream



IIABL All Day Tailgate on the Beach



Rock it out with The Tip Tops

Download the following forms: 2017 IIABL Convention Registration Form 2017 IIABL Convention Exhibitor Registration Form 2017 IIABL Convention Sponsorship Form 2017 IIABL Company & Broker Reception Form 2017 IIABL Tentative Convention Program Louisiana Agent 25

Webcasts E&O Risk Management March 30, April 4, April 15 & April 20 Available on Demand

Ethics April 4, April 11, April 14, May 8, May 16

Available on Demand

Flood April 4

Available on Demand

Commercial & Personal Lines Courses Click above title for courses & dates for 2017 Available on Demand

Seminars 2017 E&O Classes 3/28—Monroe 3/29—Lafayette 3/30—Baton Rouge 3/31—Metairie

2017 Flood Classes 5/9—Bossier City 5/9—Monroe 5/10—Lafayette 5/11—Kenner 5/11– Covington

IIABL Fall Education Conference October 19 Shreveport Convention Center

Events Young Agents Crawfish Boil March 24, 2017 Lakeside Daiquiri Baton Rouge

Trusted Choice Make A Wish Bowling Fundraiser April 20th—New Orleans April 28th—Shreveport, Monroe, Lafayette, Baton Rouge

IIABR Charity Golf Tournament May 4, 2017

CSR Training: The Customer Service Representative is key employee in every agency and is a difficult commodity to find.

Environmental Strategists (eS) Becoming a certified environmental Strategist™ (eS) will equip you with the knowledge to identify, manage and transfer environmental exposures impacting everyday business.

Young Agents @ The Races May 17, 2017 Louisiana Downs

Carter Plantation

On-Demand Webcasts Masters Series: The Master Series are unique agency management courses from industry experts. in the Masters Series.

Cyber Risk Manager (cyRM) Completion of the Cyber Exposures & Insurance – Training for Agents & Brokers course qualifies you to register for the cyRM certification for FREE.

Pre-Licensing Online prelicensing 3 optional study packages available Click here for additional information

Louisiana Agent 26

Company

Coverage Type

Overall % Impact:

Overall $ Impact:

Number of Policyholders:

Changes

GoAuto Insurance Co

19-Private Passenger

+6.80%

$1,287,755

7,785

New: n/a Renewal: 4/17/2017

GoAuto Insurance Co

19-Private Passenger

+13.2%

$7,740,406

49,725

New: 3/12/207 Renewal: 4/17/2017

Great Northern Insurance Pacific Indemnity Co Vigilant Insurance Co Federal Insurance Co

19 -Commercial Auto

+4.6%

$99,435

248

New: 3/15/2017 Renewal: 3/15/2017

Federated Mutual Ins Co

9â&#x20AC;&#x201D;Inland Marine

-.08%

-$1,458

156

New: 8/1/2017 Renewal: 8/1/2017

Old Republic Insurance Co

16â&#x20AC;&#x201D;Workers Comp

10.3%

-$270,728

78

New: 5/1/2017 Renewal: 5/1/2017

CUMIS Insurance Society

17-Other Liability

-7.0%

-$68,480

187

New: 10/1/2017 Renewal: 10/1/207

Pennsylvania Lumbermans Mutual Insurance Co

19-Commercial Auto

+5.0%

$90,791

66

New: 6/1/2017 Renewal: 6/1/2017

Greenwich Insurance Co

16-Workers Comp

-12.3%

$401,522

149

New: 5/1/2017 Renewal: 5/1/2017

ACIG Insurance Co

16-Workers Comp

-6.240%

$30,764

16

New: 5/1/2017 Renewal: 5/1/2017

American Automobile Ins Co

16-Workers Comp

-8.9%

$36,108

66

New: 5/1/2017 Renewal: 5/1/2017

Medical Protective Co

11-Medical Malpractice

18.0%

$17,961

27

New: 8/15/2017 Renewal: 8/15/207

American Zurich Ins Co American Guarantee & Liability, Colonial American, Zurich American

16-Workers Comp

-10.8%

-$6,849,642

2,144

New: 5/1/2017 Renewal: 5/1/2017

Insurance Co of the West

16-Workers Comp

-0,900%

-$1,362

7

New: 5/1/2017 Renewal: 5/1/2017

T.H.E. Insurance Co

16-Workers Comp

-7.80%

-$8,469

17

New: 5/1/2017 Renewal: 5/1/2017

Starr Indemnity & Liability Co

16-Workers Comp

-8050%

-$692,171

138

New: 5/1/2017 Renewal: 5/1/2017

Louisiana Agent 27

A:

Teresa, your question raises so many concerns, but I will try to address each of them in this short, condensed response.

By Mary LaPorte, CPCU, CIC,

Q:

As a service to our customers, we always read the insurance requirements in any contract before issuing a Certificate of Insurance. We want to assure our customer that the insurance provided meets the requirements. How should we handle situations when an additional insured is requesting a 30-day notice of policy cancellation? If we point out that the coverage is not in compliance, the insured may lose out on the contract. Since the carrierâ&#x20AC;&#x2122;s will not do this, could our agency send the additional insured notice of cancellation? The problem we see is that we do not always know that a policy is going to be cancelled 30 days out. Any suggestions?

First of all, the fact that you are reading the insurance requirements of contracts is a good practice, but only if this is done by someone highly skilled and experienced in this area. This person needs to have an in-depth understanding of the coverage form, including an understanding of how the policy will respond to complex contractual situations.

You state that the certificate holders are additional insureds. There are two ways they can become an additional insured: 1) By being named in the policy by endorsement.

Most carriers are not willing to name an additional insured without charging a premium for the endorsement. It will depend on the language in the endorsement whether the additional insured will receive a notice of cancellation. Some carriers may even be willing to send a 30-day notice, perhaps excepting nonpayment of premium.

Teresa, Florida Continued page 32

Continued page 29

Louisiana Agent 28

BIG “I” APPLAUDS REINTRODUCTION OF FLOOD INSURANCE BILL IN SENATE AND HOUSE Legislation would ensure private policies satisfy NFIP continuous coverage requirements.

The Independent Insurance Agents & Brokers of America (IIABA or the Big “I”) today applauded Sens. Dean Heller (R-Nevada) and Jon Tester (D-Montana) and Reps. Dennis Ross (R-Florida) and Kathy Castor (DFlorida) for introducing the “Flood Insurance Market Parity and Modernization Act.” This legislation allows for private flood insurance to satisfy National Flood Insurance Program (NFIP) continuous coverage requirements; meaning that policyholders can obtain NFIP coverage without losing their grandfathered status if they leave the program, obtain coverage in the private market, and later find that this new coverage no longer meets their needs. ”The Big ‘I’ thanks Sens. Heller and Tester and Reps.

Ross and Castor for introducing this important legislation that clarifies that having an active flood insurance policy, whether through the NFIP or through the private market, should be considered continuous coverage for purposes of NFIP rating requirements,” says Charles Symington, Big “I” senior vice president of external and government affairs. “The Big ‘I’ supports the gradual development of a private market as a complement to

the NFIP, and this legislation is of vital importance to that goal.”

The bill also clarifies that a private flood policy can satisfy the mandatory purchase requirement for flood insurance and gives state insurance regulators the authority to determine what is “acceptable” private market flood insurance.

“The Big ‘I’ supports a reformed NFIP and slowly increasing private market involvement; however, absent a viable private market alternative for policyholders, the association will continue to advocate for a timely reauthorization of the NFIP ahead of its expiration on Sept. 30, 2017,” continues Symington.

“The Big ‘I’ is also working to ensure that any changes to the NFIP recognize the important role of agents in helping consumers make informed decisions about the purchase of NFIP policies for their homes and businesses.”

To Learn More About Insurance Fraud & Earn CE Credits, visit the Big “I” VU Fraud Center for On-Line Courses, Resources & Daily News.

Louisiana Agent 25 29

Louisiana Agent 30

FREE FLOOD COURSES EXCLUSIVELY FOR IIABL MEMBERS REGISTRATION & LOCATIONS □ May 9, 2017 8am – 11am

Bossier City – Hilton Garden Inn 2015 Old Minden Rd

□ May 9, 2017 2pm – 5pm

Monroe - Courtyard Marriott 4915 Pecanland Mall Drive

□ May 10, 2017 8am – 11am

Lafayette – Hilton Garden Inn 2350 W Congress St

□ May 11, 2017 8am – 11am

Kenner – Crowne Plaza 2829 Williams Blvd.

□ May 11, 2017 2pm – 5pm

Covington – Staybridge Suites 140 Holiday Blvd.

Download Registration Brochure

2) By blanket additional insured endorsement. The ISO form CG 20 33 Additional Insured – Owners, Lessees or Contractors – Automatic Status When Required in Construction Agreement With You endorsement requires that the additional insured status applies only

“when you and such person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on your policy”. Other carrier endorsements may be more restrictive. Since the carrier does not know the identity of every party covered under the endorsement, they certainly are not sending notice of cancellation to anyone.

If your agency were to take on the role of notifying additional insureds of cancellations, it would greatly increase your E&O exposure. You would need a fool -proof system to assure that none were missed. As you already stated, in many situations, you often don’t even know about a cancellation in sufficient time to do so. An additional insured would consider the fact that you didn’t know about a cancellation to be a poor excuse for non-compliance with the requirement.

The better alternative is to have a frank conversation with your insured as you explain the problem.

If your carrier is willing to endorse the additional insured to the policy, you must explain that the endorsement will result in an additional premium. Depending on the carrier, this may or may not result in the additional insured receiving a 30-day notification.

If this is not an option, advise your customer that the notice cannot be provided. A good risk management practice is to put this statement in writing to your insured.

Mary LaPorte is a consultant and educator with a strong background in Errors & Omissions loss prevention. Forward your E&O questions to marylp@lpinsuranceconsult.com.

Louisiana Agent 32

The Eight Second Rule We’ve all heard of the five second rule. If you drop food on the floor, the theory is you have five seconds to pick it up and eat it before it’s ‘contaminated’ with any germs (admit it, you’ve tested this concept before). But, have you heard of the eight second rule? Now that’s the new trending phrase.

According to a recent study by Microsoft, the human attention span continues to shrink. We now have a shorter attention span than a goldfish at only eight seconds.

What’s to blame for our new short attention span?

Microsoft believes increased digital lifestyles are to fault, where people front load their attention and have more intermittent bursts of high attention. If you use digital or social media, whether reading the news online or checking your friend’s status’s through your Facebook feed, you are probably scrolling until something catches your eye, read or watch a little, then continue moving

along until you find something else that interests you. You are most likely making that decision if you are attracted to the content or not within eight seconds.

If your staff needs expert training to master the ‘eight second rule’, develop and deliver a strong elevator pitch, master negotiation skills and other essential business skills, we have solutions for you. Visit our eLearning portal to purchase interactive, fully narrated online learning modules.

The Advanced Communication and Negotiation Bundle provides several courses for your employees to build the necessary skills to become an expert communicator.

Also included on the portal are courses on Business Communication Fundamentals, Client Management Essentials and dozens of commercial and personal lines coverage basics for new hires.

There are even courses for emerging leaders to develop managerial and leadership skills.

For more information, visit the IIABL eLearning Portal or contact iiablstore@mycoursecenter.com

Louisiana Agent 33

GOLD LEVEL

SILVER LEVEL

BRONZE LEVEL

AMERISAFE

AMERICAS INSURANCE

BANKERS INSURANCE

CNA INSURANCE

FCCI GROUP

FOREST INSURANCE

GULFSTREAM P&C

HOMEBUILDERS SIF

LANE & ASSOCIATES

LUBA WORKERSâ&#x20AC;&#x2122; COMP

MAISON INSURANCE

MARKEL FIRST COMP

RPS COVINGTON

SUMMIT CONSULTING

EMC INSURANCE

Louisiana Agent 35

IIABL 2016—2017 BOARD OF DIRECTORS & OFFICERS Richard D. Jenkins President Moore & Jenkins Insurance—Franklinton Neil Record President Elect Record Agency, Inc.—Clinton

John L. Beckmann, III Secretary/Treasurer J. Everett Eaves—New Orleans H. Lee Schilling, Jr. National Director Schilling & Reid Insurance—Amite David Dethloff Past President Dethloff & Associates—Shreveport Derek Canchola Young Agent Representative Blumberg & Associates—Baton Rouge Byram H. Carpenter, III Moreman, Moore & Co—Shreveport Brenda Case Lowry-Dunham, Case & Vivien—Slidell Joseph Cunningham, Jr. Cunningham Agency—Natchitoches Donna DiCarlo Riverlands Insurance Services—LaPlace Morris Funderburg Reeves, Coon & Funderburg—Monroe

Ross Henry Henry Insurance Service—Baton Rouge Bret Hughes Hughes Insurance Services—Gonzales Philip McMahon Paul’s Agency—Morgan City Joe King Montgomery Thomas & Farr Agency—Monroe Joseph A. O’Connor, III The O’Connor Insurance Group—Metairie Paul Owen John Hendry Insurance Agency-Zachary Martin Perret Quality Plus—Lafayette David T. Perry Arthur J. Gallagher RMS—Baton Rouge Robert Riviere Riviere Insurance Agency—Thibodaux

Armond Schwing Schwing Insurance Agency—New Iberia Michael D. Scriber Scriber Insurance Services—Ruston Donelson P. Stiel David H. Stiel, Jr. Agency—Franklin

Louisiana Agent 36