POLICY MAGAZINE - Fall 2023

POLICY FALL 2023

Introducing Incoming Chairman

VAUGHN GRAHAM, JR.

NO ONE KNOWS OKLAHOMA BUSINESSES QUITE LIKE OKLAHOMANS DO. That’s why our communities have trusted CompSource Mutual for 85+ years. We’re proud to be a premier workers’ compensation carrier offering your customers the best: top-rated financial strength and first-rate service.

CompSource Mutual is rated A (Excellent) by AM Best.

v

Start a Quote | CompSourceMutual.com | 800.347.3863

FALL 2023 | VOL. 73 NO. 32

EDITORIAL STAFF Publisher

Denise Johnson, CISR, CIC

COVER

COLUMNS

12 Introducing Vaughn Graham, Jr.

4 New BIGiOK Chair Ready to Dive Headfirst Into the Association

Managing Editor

FEATURES

Graphic Designer

10 The Power of Connection: Come Alongside, Friend

Jerri Culpepper Denise Canon PROFESSIONAL STAFF President/Chief Executive Officer

Denise Johnson, CISR, CIC Chief of Staff and Operations

Josh Reasnor, MSSL, CISR, CKC Senior Vice President of Strategic Initiatives

Sara Bradshaw Ray, CIC, CKC

Workers’ Compensation Account Manager

Jeanette Madrid

Director of Member Services

Shania Slavick

Director of Marketing and Communications

Jerry Rappe’

Vaughn Graham Jr., CIC, Chairman

24 Inadequate Limits

7 President/CEO Shares Planned Areas of Focus for the Fall Denise Johnson, CISR, CIC

27 Newsmakers 34 The Bank Soundness Question: What It Means for Agents

Specialty Lines Service Account Manager

Cindy Munden, CISR

17 The Importance of Finding a Mentor Krista Kautz

18 ‘Connect and Collaborate’ Theme of Upcoming Education Convocation Chris Floyd, CIC, CRM

Director of Professional Liability

20 Embracing the Changing Landscape: Thriving in the New Era

Cari Senefsky

Sara Bradshaw Ray, CIC, CKC

10

12

34

23 Rising Homeowners Insurance Rates Nationally and the Implications for Oklahoma Glen Mulready

POLICY is the official publication of the BIGiOK. POLICY is published quarterly and distributed to all member agencies and other interested parties in Oklahoma. Manuscripts and contributions are welcome and will be considered for publication at the discretion of the BIGiOK Publications Committee.

Correspondence and advertising inquiries may be addressed to BIGiOK, P.O. Box 13490, Oklahoma City, OK 73113.

Ph: (405) 840-4426 or 1-800-324-4426

Visit www.BIGiOK.com Select images and graphics courtesy of freepik.com

From the Chairman

New BIGiOK Chair Ready to Dive Headfirst Into the Association

I can’t believe we’re past the midway point of 2023. I hope everyone’s year is going great. Before we know it, 2024 will be here with new goals, opportunities and challenges we all have in the insurance industry.

Fourteen years ago, I started at Rich & Cartmill following six years in the banking industry. That first week, my dad “politely” told me I needed to go to some Young Agents luncheons. I literally had no clue what group he was talking about or what I was getting ready to attend, but he said he’d buy my lunch, so I was perfectly fine with it.

While I still didn’t know much about the Young Agents group or the Big I of Oklahoma at the time, I met a lot of great people during the lunch and figured I’d

not only service their customers in a way second to none but also play such vital roles in the many communities we represent throughout the state.

As I mentioned at my installation luncheon, there is no need to fix what isn’t broken. Between the leadership of Denise Johnson and her team, along with the path created by the many past chairmen, this Association is in as great a shape as I’ve seen in my 14 years.

I hope to continue the Association down that same path. I encourage all agency principals and people who regularly participate in Big I events to bring one or two new guests to the next event, as my dad did for me years ago.

The knowledge, friendships and wisdom I’ve gained from being active in

The knowledge, friendships and wisdom I’ve gained from being active in the Association far outweigh the time I’ve spent working for it. continue to attend events going forward.

I can’t say that I knew that day I wanted to dive headfirst into the Association and become a board member, but I liked their message and the camaraderie of the group. Fourteen years later and after having served on the Young Agents Committee as well as the board of the Big I for several years, I’ve never been happier that my dad invited me to that lunch in November 2009.

I’m looking forward to my year as chairman this year, and it’s my honor to represent such a wonderful group of hard-working men and women who 4

POLICY | Fall 2023

Vaughn Graham Jr., CIC Chairman there are some issues we’re addressing to protect our industry and agencies. Please know that we are working for you – and that Denise, our board and our lobbyist, Jamie Longacre, have put a major emphasis on this with the different issues being discussed at the Capitol.

I look forward to representing our industry as the chairman of Big I of Oklahoma this year. We have a wonderful board in place that will be working for our membership.

I hope everyone has enjoyed their summer and survived the heat! Hopefully, I will see everyone at the upcoming Young Agents Conference in Oklahoma City on Sept. 28-29 at the Colcord Hotel.

the Association far outweigh the time I’ve spent working for it. Whether you are a Young Agent (under the age of 40 or within your first five years in the business) or an insurance professional who has never attended an event, you are always welcome.

Throughout the year with my quarterly articles, I will update everyone on what the Association is working on for our industry. If anyone ever has any questions or concerns, please don’t hesitate to reach out to me.

I can tell you that the legislative issues will be a MAJOR priority this year, as BIGiOK.com

With roots dating back to 1947, we have navigated other periods of uncertainty and various economic cycles.

For over 75 years, Mid-Continent Group has been committed to providing specialty commercial insurance for the oil and gas industry. Our specialized expertise and entrepreneurial, relationship-driven approach has allowed us to offer solutions which address the unique needs of our agents and insureds.

Policies are underwritten by Mid-Continent Casualty Company, an authorized insurer in all states except AK and NY; Mid-Continent Assurance Company, an authorized insurer in CA, CT, DE, HI, ID, LA, ME, MA, MO, NE, NV, NH, NJ, ND, OH, OK, PA, RI, TX, VT, VA, WV, WI and the D.C.; and Oklahoma Surety Company, an authorized insurer in AR, KS, LA, OK, TX and OH. © 2022 Mid-Continent Casualty Company, 1437 S. Boulder, Suite 200, Tulsa, OK 74119. All rights reserved.

5606-MCG (12/22)

OKLAHOMA SURPLUS LINES ASSOCIATION OSLA MEMBERS Johnson & Johnson Inc. Ph: 800-800-4007 www.jjins.com

One General Agency Ph: 800-299-1951 www.YourOGA.com

Jaeger + Haines, Inc. Ph: 800-632-0342 www.jplush.com

Jencap Group Inc. Ph: 800-525-7211 www.jencap.com

Patriot National Underwriters Ph: 800-291-6846 www.patriotnational.com

IIAOK (Associate) Ph: 405-840-4426 www.iiaok.com

RPS, Inc. (Tulsa / OKC) Ph: 918-742-8496 www.rpsins.com

Specialty Insurance Managers Ph: 800-888-0202 www.simoklahoma.com

Imperial PFS (Associate) Ph: 800-727-1717 www.ipfs.com

RT Specialty Group Ph: 405-726-2800 www.rtspecialty.com

Statewide General Agency Ph: 918-492-1446 www.swgen.com

HONORARY MEMBER : Denise Johnson, President & CEO of IIAO

To become a member of OSLA please contact Jana Anderson at 405-879-4288 Oklahoma Surplus Lines Association 5100 N. Classen Blvd. Suite 105 Oklahoma City, OK 73118

BIGiOK.com

Fall 2023 | POLICY

5

The security you need.

The name you trust.

OUR PRODUCTS Businessowner’s Commercial Auto Commercial Umbrella Workers’ Compensation Pay-As-You-Go options with hundreds of payroll partners!

APPLY TO BE AN AGENT: WWW.GUARD.COM/APPLY/ Not all Berkshire Hathaway GUARD Insurance Companies provide the products described herein nor are they available in all states.

Visit www.guard.com/states/ to see our current product suite and operating area.

From the President/CEO

President/CEO Shares Planned Areas of Focus for the Fall

Denise Johnson, CISR, CIC BIGiOK President/Chief Executive Officer

We’ve had a busy summer here at BIGiOK! Summer is a time when we work to get ready for our fall events, including our YA conference and many of our education classes. People are home from vacation and ready to get “back on schedule.” A few things that we are focusing on will be: • Consulting – We have so many of our agencies that are working to get to the next level. This is the answer….

1. What do you want your agency to look like in 10 years?

2. How do we get there?

3. Who can help??

4. The BigIOK team is here to help – start here: BIGiOK.com/assessment

• Technology – We are now partnered with Catalyit. Give this Agency Tech guide, which is chock full of solutions, a try. As a member of BIGiOK, you have access! BIGiOK.com/catalyit • Legislative Advocacy – Sometimes, this gets overlooked; however, legislative advocacy is one of our key areas of focus.

We are constantly looking for ways to be available to our legislators for any insurance-related issues they may have.

It is vital for our members to support OKPAC (our state PAC) or InsurPAC (federal). BIGiOK.com/okpac This issue, we are featuring our new chairman, Vaughn Graham Jr., a secondgeneration chairman. Prior to entering

Sometimes, this gets overlooked; however, legislative advocacy is one of our key areas of focus. We are constantly looking for ways to be available to our legislators for any insurance-related issues they may have.

• Young Agents – Our FUTURE! Their conference will be in OKC this year, and you won’t want to miss it. We have quality speakers and lots of opportunity to network. Encourage your Young Agents to take a part in this great event!

BIGiOK.com/accel • Education – Did you know we were just awarded the 2023 Diamond Award for Education Excellence? Our education programs are above all others. We have designations available and more than one way to learn – take advantage of our incredible classes!

BIGiOK.com

the insurance industry, he worked in the banking industry until he felt insurance calling his name. I’m looking forward to working with him and am excited about what he has in store for the Association.

As you may be aware, our entire board of directors are volunteers, and this is their chance to give back to the industry and Association. Should you see them, they are open to any questions you may have; additionally, please be sure to thank them for their service to BigIOK. As always, feel free to contact me at Denise.Johnson@bigiok.com with any questions or concerns – I’m here to help!

Fall 2023 | POLICY

7

Maintaining a safe workplace shouldn’t be a daunting task.

Protecting the workforce is what we do at Summit, and we’re here to help every step of the way.

summitholdings.com Policies are underwritten by Bridgefield Casualty Insurance Company and Bridgefield Employers Insurance Company, authorized insurers in AL, AR, FL, GA, IN, KY, LA, MS, NC, OK, SC, TN, TX and VA; Retailers Casualty Insurance Company, authorized in AL, AR, LA, MS, OK and TX. ©2021 Summit Consulting LLC (DBA Summit, the people who know workers’ comp LLC), PO Box 988, Lakeland, FL 33802. All rights reserved.

OKPac is BIGiOK’s state political action committee. It provides financial support for state elected officials who will provide support for or have shown support of issues affecting the insurance industry and to those who share our business philosophies. Only individuals or partnerships can make contributions to OKPac. Under Oklahoma law, OKPac can accept no contributions from corporations.

2023 Contributors Wes Becknell Debbie Burton Jeff Burton

Eitzen Family Trust Kenneth Hunger Denise Johnson

Ashley Mitchell Jon Moon Avery Moore

Jeremy Pounds Randolph Scott

InsurPac is BIGiOK’s national political action committee. It pools the voluntary and individual financial contributions of thousands of independent insurance agents to help elect candidates to Congress who share BIGiOK’s business philosophies. InsurPac is the largest property-casualty insurance industry PAC in the country.

2023 Contributors Jonathan Baggs Wes Becknell Travis Brown Jeff Burton Deborah Burton Mark Carlin Vicky Courtney Philip Eitzen Vaughn Graham Jr. Vaughn Graham Sr.

Austin Greenhaw C. Ross Harris Alan Hodges Tony Holmes Denise Johnson Mark Long Patrick Mandeville Mark McPherson Avery Moore Kathy Reeser

Arthur Rickets T.J. Riley Marilyn Risner Burke Benjamin Robbins Michael Ross Belynda Tayar Ryan Teubner Brad Warwick Tamara Watson

See more information and quantifiable examples of contributions by going to: OKPac - BIGiOK.com/OKPac InsurPac - BIGiOK.com/InsurPac

Is your name not on the list? Make contributions today at BIGiOK.com/pac Contributions as of 4/1/2023. Only gifts of $100 or more are listed, except for Young Agents, whose contributions of any amount are listed.

BIGiOK.com

Fall 2023 | POLICY

9

The Power of Connection

The Power of Connection: Come Alongside, Friend "Look for the helpers." ~ Fred Rogers

Amie Haar Elite Professional Network Member & MyNetwork Facilitator

Those are the high-level answers given when asked, “What do you want to do when you (ha!) grow up?”

But while those answers are genuine, it’s so much simpler than that. The truth is … I just like helping people.

These simple, yet profound words spoken by a young child picking up kindling resonate with many of us. At our core, we are driven by the desire to connect and assist others. While we may have lofty aspirations of changing the world, what it really boils down to is that the act of helping others is rooted in something much simpler and more fundamental … and it does, in fact, have the power to change the world.

Let’s explore a bit, shall we?

“I just like helping people.” These were the words spoken by my 3-year-old while we were gathering firewood for our campsite a couple of weeks ago, and it struck me… Me too, buddy.

10 POLICY | Fall 2023

Come alongside.

Disrupt the workplace.

Change the world.

As humans, we all have our basic needs. The food, the shelter, the clothing needs. We also have visceral needs. The seen/heard/valued ones.

And I really do believe that at our core, that’s what we want to provide others with.

Whether it’s within our personal relationships or in our professional continued on page 21 BIGiOK.com

About BIGiOK

BIGiOK LEADERSHIP Chairman

Vaughn Graham Jr., CIC Rich & Cartmill Inc. Oklahoma City

Secretary

Scott Dull

Omega Insurance Agency Choctaw

Chairman Elect

Treasurer

Ricketts Fennell & Assoc.

Tulsa

VIP Insurance Edmond

Vicky Courtney

State Director

Chris S. Floyd, CRM, CIC Brown & Brown Insurance Pryor

Kathy Reeser

Immediate Past Chairman

Jerrad Van Coots

Burrows & Burrows Agency Claremore

Director at Large

Director at Large

Director at Large

INSURICA Tulsa

Arnett Insurance Agency Durant

Cornerstone Insurance Group Oklahoma City

Guy Griggs

Rob Piearcy

Trent Willis

Company Liaison

Company Liaison

YAC Chairman

One General Agency Oklahoma City

CompSource Mutual Oklahoma City

Ed Berrong Insurance Agency Edmond

Jennifer Dotter

Brad Owens

Krista Kautz

BIGiOK MISSION STATEMENT

As the new voice of the independent agents of Oklahoma, BIGiOK promotes and provides education, legislative advocacy, innovative concepts and practical solutions, and community and career opportunities.

ABOUT BIGiOK BIGiOK is the largest insurance trade association in Oklahoma. With more than 475 independent insurance agencies, we represent nearly 3,000 independent insurance agents and their employees and more than 100 company members. BIGiOK member agencies range in size from one person to some of the largest agencies in the region.

Founded in 1906 as the Oklahoma Association of Local Fire Insurance Agents, BIGiOK is a result of the consolidation of the Independent Insurance Agents of Oklahoma, Inc. (IIAO) and the Oklahoma Association of Professional Insurance Agents (OAPIA) on Jan. 1, 1992.

BIGiOK policy is set by a board of directors elected at the annual conference. Policy is implemented by a professional BIGiOK.com

staff located in Oklahoma City. BIGiOK’s mission is carried out through a variety of programs designed to enhance the business of independent insurance agencies.

BIGiOK is an active advocate on behalf of independent agents before legislative, regulatory and judicial groups in Oklahoma and at the federal level.

BIGiOK is affiliated at the national level with the Independent Insurance Agents and Brokers of America with offices in Alexandria, Virginia, and Washington, D.C. BIGiOK is an excellent source of information through POLICY magazine, published quarterly, and the Oklahoma Agent, a monthly newsletter of time-sensitive material for its members.

Fall 2023 | POLICY

11

Getting to Know Vaughn Graham Jr.

Vaughn Graham Jr. Shares His Strategic Goals as New BIGiOK Chair

By Jerri Culpepper

As the son and grandson of men who made a living in the independent insurance business, one might expect Vaughn Graham Jr. to have taken the straight and narrow path to a career in the same field.

But early on, Vaughn – the son of Vaughn Graham Sr. of Consolidated Insurance Agency and Rich & Cartmill (and former BIGiOK and IIABA national chair) and the grandson (on both the maternal and fraternal sides!) of insurance industry professionals – set his sights in banking or investments. In fact, the Tulsa native says he actively avoided taking an insurance class as an elective when he was a student at 12

POLICY | Fall 2023

the University of Oklahoma, where he earned a BBA in finance.

Early Days Vaughn’s first job out of college was with Bank of Oklahoma in Tulsa, where he was enrolled in BOK’s Accelerated Career Track Program.

As a trainee, he rotated through the various commercial lending groups.

That was followed by a stint as a credit analyst before assuming the position of commercial lender.

“I really enjoyed my six and a half years working at BOK,” Vaughn recalled. “I worked with a lot of great people, learned how to be a professional in a corporate environment, and learned how to

develop great business relationships internally and externally with customers.”

His BOK experiences proved invaluable when he had a change of heart and decided to follow in the footsteps of his father and grandfathers, after all.

Transition to Insurance In October 2009, Vaughn assumed his first job in the insurance field – at Rich & Cartmill – first as a producer.

At Rich & Cartmill, he now holds the titles of vice president, executive committee member and shareholder.

As a producer, he specializes in construction (surety and insurance).

BIGiOK.com

Getting to Know Vaughn Graham Jr. Among his other accomplishments, Vaughn said he is most proud of building “my book from scratch and becoming a shareholder within five years.”

Goals as Chairman As the incoming BIGiOK chairman, Vaughn has set several strategic goals for the Association.

“Obviously, staying on top of and in front of legislation is going to be a major focus,” he said. “There are some significant legislative issues currently being discussed that directly affect our industry and membership. We need to be the ones educating and discussing with the legislators on those insurance-related issues.”

Recruitment is also near the top of his list.

“Whether it’s helping educate our current members about perpetuation through the various value- added services we are now providing or recruiting young talent to our industry, we need to make it a priority,” he said. “The vast majority of our insureds always discuss needing more labor, etc., but we are in the same boat. The challenge for our Association will be finding effective ways to help recruit the workforce to our industry.”

Challenges Facing the Association “Well, as we saw in 2019 with the beginning of the pandemic, our Association had better be nimble and willing to adapt to change because challenges will come again in the next decade that we don’t foresee right now,” Vaughn observed. “But the key is how and how quickly we respond to those challenges. Cyber will continue to be a major threat to our society and our insureds, so making sure our industry is on top of those threats and finding ways to mitigate them will be a key.

BIGiOK.com

BIGiOK Chairman Vaughan Graham Jr. and BIGiOK President/Chief Executive Officer Denise Johnson.

“Finally, a challenge will be to keep our membership engaged in the Association and to make sure they continue to see the value that it provides,” Vaughn added. “With many agency principals approaching retirement in the next decade and work environment changes occurring with remote workers, it is critical we stay involved with those new agency principals and make sure they know the Association is there to help them grow their agency and navigate challenges they may not be able to solve by themselves.”

Association’s Strengths and Weaknesses Vaughn cites “leadership and reputation” as two of the Association’s greatest strengths.

“Denise [Johnson] has developed a wonderful team for the Association,”

he said. “She and her team are as respected on a national level of state associations as any other state. Also, the fact that our state has produced three national chairmen is a big deal and definitely brings credibility on a national level to our Association.”

While it might not be a weakness, Vaughn believes the Association must continue its efforts to grow awareness of all the benefits offered

by BIGiOK. “We need to continue to focus on agency principals so they understand what we can provide them as well as encouraging them to get their younger agents involved in our Young Agents events. I don’t think many agency owners really understand how much we can help their young agents, which ultimately helps their agencies.”

Fall 2023 | POLICY

13

Getting to Know Vaughn Graham Jr.

The Graham Family. Back row: Vaughn Jr. and Vaughn III. Front row: Eva, Natalie and Corbin

Leadership Style Describing himself as a “lead by example” type of leader, Vaughn also recognizes that good leaders still have to be willing to have tough conversations. At 42, this is an aspect of leading that he still finds challenging while recognizing it’s a vital part of any leadership role.

“I want everyone to respect me because of my work ethic and attitude over everything else,” he added. “In order for a company or board to be successful, everyone on the team needs to fulfill their role and be proud of that.” So, one of his goals as chair will be to work to instill 14

POLICY | Fall 2023

a sense of confidence and pride in all Association members.

Family and Fun Vaughn and his wife, Natalie, have three children: Vaughn III, 14; Eva, 11; and Corbin, 9. He enjoys watching any sporting activity (he’s a “big OU fan”), going to the lake, running, and helping coach his kids’ various teams over the years.

Associated Builders and Contractors of Oklahoma board, and on the Cascia Hall School Board.

Despite his relatively late start as an independent insurance agent, Graham has really taken the ball and run with it. Now, he’s ready to carry the ball for the Association, with the help and guidance of the BIGiOK staff and its team members.

He is active in the community, having served on various United Way committees, the Juvenile Diabetes Research Foundation Board, Independent Agents of Oklahoma of Greater Tulsa board chairman, on the BIGiOK.com

Education at BIGiOK

SEPTEMBER

September 6: IA-MBA Program September 15: Episode 4: Free Friday Ethics Webinar ** Se ptember 19: CISR Elements of Risk Management Hybrid September 20: CIC Commercial Multiline - Hybrid

OCTOBER

October 17: CISR Agency Operations - Hybrid October 18: James K. Ruble Graduate Seminar - Hybrid October 20: Episode 5: Free Friday Ethics Webinar **

NOVEMBER

November 3: Episode 5: Free Friday Ethics Webinar ** November 14: CISR Commercial Casualty 1 - Hybrid

No vember 14: KOLBE Strengths Workshop - 2 hrs. of CE Approved November 15: CIC Commercial Property - Hybrid No vember 17: CISR Insuring Commercial Property Hybrid

DECEMBER

December 5: CISR Commercial Casualty 2 Webinar ** December 6: CIC Life & Health Webinar ** December 8: CISR Life & Health Essentials Webinar ** December 15: Episode 5: Free Friday Ethics Webinar ** ** NOTE: ONLINE ONLY CLASSES

More information at BIGiOK.com/education

You are...

Promote the value you bring to your local community.

Access our new campaign that puts your unique value in the forefront.

Provide your current and prospective clients with a snapshot of the added benefits of working with a Trusted Choice® Independent Insurance agency.

Customize these materials today!

cobrand.iiaba.net/made-for-you/i-am

BIGiOK.com

Fall 2023 | POLICY

15

We’re the kind of insurance company you can take home to mom.  Trustworthy  Financially strong  Local roots  Values long-term relationships  Always brings a side dish At EMC, we show our full value in countless ways. But perhaps most importantly, we serve as a partner to our local independent agents.

Let’s work together to ensure your clients have the coverage they need when they need it.

emcins.com

EMC Insurance Companies | Des Moines, IA | 800-447-2295 ©Copyright Employers Mutual Casualty Company 2023. All rights reserved.

From the Young Agents Committee

The Importance of Finding a Mentor

Krista Kautz Young Agents Committee Chairman

Hello! I am Krista Kautz, a producer at Berrong Insurance Agency. I’m excited to serve as the 2023-2024 chair of the Oklahoma Young Agents Committee! I have been in the industry for seven years and involved in the Association since 2018. It’s been an honor serving on the Young Agents board the past couple of years, and I’m excited for everyone to see what the committee has in store for 2024.

What Is a Young Agent?

A Young Agent is an agent or company representative under the age of 40 OR with fewer than five years of experience.

What's Happening, Young Agents?

I want to take a moment to extend a BIG thank you to all those who attended our Singo Community Service Fundraiser for Pepper’s Ranch (a longterm residential care facility for abused and neglected children) on June 6 — and let me tell you, if you weren’t there, you missed out! We had a dunk tank, pies in the face and a fabulous taco truck! The dunk tank even featured our Oklahoma Insurance Department commissioner, Glen Mulready! He was dunked more than a few times, for sure! We raised BIGiOK.com

$6,563 for Pepper’s Ranch at this event!

Future Insurance Leaders of Oklahoma (FILO) are due to complete their 2023 modules and graduate at our Young Agents Conference at the Colcord in Oklahoma City on Sept 29. Why is it important for young agents to participate in FILO? Well, I’m glad you asked! FILO not only launches new professionals into our industry with leadership-, sales- and industry-related tools for their careers, but the program is also a prerequisite for joining the Young Agent Committee.

If you’re a motivated young agent, or know one, this is the way you start your path to further involvement in our Association. We pull specifically from the FILO list when the committee is considering new members. If you would like to know more information, be sure to contact Shania or any member of the Young Agents Committee!

Young Agent Conference Alert!

Our 2023 Young Agents “Accelerate Your Career” conference will be held at the Colcord in Oklahoma City Sept. 2829. We’ll be spending our first afternoon together at Social Capital for a Cocktail Hour and Speed Networking event. Don’t worry, we’ve allotted time for the cocktail hour before the speed networking starts; that way, you’ll be plenty ready to meet new people!

For the 29th, we have energetic speakers for you, including Ciara Gravier, CEO and founder of The Bunker Insurance & Risk Management; Peter MacDonald, CEO and co-founder of Wunderite; and Kelly Donahue-Piro, president of Agency Performance Partners, an expert in agency growth and development.

The Importance of Finding a Mentor

Becoming an insurance agent is an exciting career choice. As a young insurance agent, you might feel

overwhelmed by the complexities of the industry and the competition. I’m here to say that you’re not alone and that we have ALL been there. It’s impossible to know it all, and that’s why our industry is so great! Most people in our industry find joy in teaching others and sharing their experiences.

Mentors can: Provide Guidance and Support: A mentor can provide guidance and support as you navigate your career.

They can share their experiences, provide feedback on your ideas or work, and help you develop your skills.

Offer Career Advice: They can help you set goals and develop strategies to achieve them. If you’re looking for an accountability partner to keep you on track, be sure to pick a mentor that will be transparent with you and let you know where you can improve.

Teach You How to Expand Your Network: Your mentor can introduce you to their network of contacts in the industry, recommend networking options and show you how to get involved in the industry on a community level or even just your business niche. There are so many associations for countless industries around the state. Networking can open doors for you that you never thought was possible.

I’d like to conclude by stressing that finding a mentor and building your network can provide young agents with invaluable support, guidance and opportunities for growth. You are not a burden to a mentor because it’s a growth opportunity for them as well. Mentors are not only reminded of the good habits that they may have almost forgotten during these discussions, but also, you as a mentee bring them fresh and new ideas to help them grow in their careers as well. It’s a true partnership that is beneficial to both parties.

Fall 2023 | POLICY

17

From the State National Director

‘Connect and Collaborate’ Theme of Upcoming Education Convocation

Connect and Collaborate! This the theme of the Education Convocation, a part of this year’s BIG I National Fall Conference, to be held Sept. 6-8 in Grand Rapids, Michigan. As in the past, our education directors from across the country will discuss and search for better ways to deliver the highest and best education to our members.

Connecting and collaborating may sound like an oversimplified attempt to describe a meeting – or may even sound a bit cliché. And in-fact, it often

mountains and change the course of history.

The Apollo 13 mission stands as a testament to the remarkable power of collaboration and teamwork. It showcased the capacity of diverse minds coming together, each contributing his or her unique knowledge and skills, to overcome seemingly insurmountable challenges.

The mission not only brought the crew home safely but also left an indelible mark on the way humanity approaches

Chris Floyd, CIC, CRM National Director

The intricate dance of minds coming together, each contributing their unique perspectives and skills, creates a symphony of innovation that can move mountains and change the course of history.” is an overworked phrase. However, the synergy of meaningful and directed collaboration is so powerful that many large corporations spend millions of dollars fostering and encouraging collaboration amongst their teammembers and stakeholders.

So, why do they do this? Well, It’s all in math.

(People + Collaboration = Creativity) x Synergy = Better Outcomes (revenues and profits) The intricate dance of minds coming together, each contributing their unique perspectives and skills, creates a symphony of innovation that can move 18

POLICY | Fall 2023

problem-solving and innovation. It is a reminder that, when people unite with a common purpose and unwavering determination, they can achieve feats that rewrite the pages of history.

In the end, collaboration and teamwork are more than just buzzwords in a corporate lexicon. They are the heartbeats of progress, the driving forces behind innovation, and the catalysts for positive change.

I encourage you to Connect and Collaborate with the Big I and find out what is possible.

Learn more by going to: www.independentagent.com BIGiOK.com

Ad_REV_01032022_OL.indd 1

1/3/2022 10:36:56 AM

Celebrating 75 Years Of Providing Competitive, Affordable Insurance.

National Security has provided competitive, affordable insurance to policyholders for 75 years.

We also provide our agents with competitive commissions, excellent customer service and experienced company adjusters.

As a Southeastern based regional company, National Security prides itself on fast, efficient service from a friendly small town company. Our agent website provides fast quotes, online policy issuance, and real-time policy information. Find out more about our products by calling 1-800798-2294 or visiting nationalsecuritygroup.com.

Elba, Alabama Elba, Alabama

Dwelling Fire • Limited Homeowners • Comprehensive Mobile Homeowners • Vacant Property BIGiOK.com

Fall 2023 | POLICY

19

From Strategic Initiatives

Embracing the Changing Landscape: Thriving in the New Era “The only way to make sense out of change is to plunge into it, move with it, and join the dance.” ~ Alan Watts

Welcome to the new era of possibilities! The world as we know it has transformed, driven by extraordinary technological innovation. The pace and magnitude of change we’re experiencing are simply mind-boggling. Disruptive technologies are reshaping every aspect of society, industries, organizations and individuals.

As independent insurance agencies, you might be wondering how to navigate these emerging trends. Fear not, because we’re here to guide you through this exciting journey and help you thrive!

Gone are the days when being a “know-it-all” was the norm. In today’s dynamic landscape, the premium is placed on becoming a “learn-it-all.” The explosion of knowledge and information has forever altered our perspective of the past and the future. We’re living in a world of limitless opportunities, accompanied by a fair share of risks.

As humans, businesses, families and communities, we must constantly adapt to this ever-evolving environment.

Work itself has undergone a remarkable transformation. It’s no longer just about repetitive tasks; it’s become a haven for knowledge and service-based endeavors. With instant access to a wealth of information, work has become more collaborative, innovative and creative than ever before. Technology plays a crucial role, making tasks more relevant and enabling us to focus on engaging our minds rather than our hands.

But it’s not just the nature of work that has changed; the very concept 20 POLICY | Fall 2023

of the workplace has undergone a remarkable shift. Working from home (WFH) was already gaining traction, and the COVID-19 pandemic served as a catalyst, accelerating this trend. WFH is now the new norm, with a delightful blend of remote and in-person work.

The traditional notion of a shared workspace is quickly fading away as people embrace the freedom of taking their work anywhere. This shift calls for new leadership approaches, fresh organizational structures and flexible systems to manage teams effectively.

Moreover, the workforce itself has undergone a tremendous makeover.

It’s more diverse than ever before, with individuals from different generations, genders, races, ethnicities, orientations, religions, backgrounds, experiences and perspectives coming together. We firmly believe that maximizing this diversity is the key to unlocking unparalleled creativity and innovation.

Just take a moment to appreciate the sheer beauty of having five generations working side by side! Younger generations, like Millennials and Gen Z, bring fresh expectations, perspectives and ideas. This shift in expectations not only impacts the way agencies operate but also reverberates through our societies and families.

Let’s not forget the incredible transformation of choice in our lives.

Thanks to technology, we’ve transitioned from multiple choice to an infinite array of possibilities. With a simple click, we can access thousands of options for entertainment, clothing, food and so much more. In the realm of work,

Sara Bradshaw Ray, CIC, CKC BIGiOK Senior Vice President of Strategic Initiatives

technology has paved the way for the gig economy to flourish. Freelancing and flexible job opportunities are on the rise, giving individuals unparalleled flexibility and freedom.

In this changing landscape, you might be wondering how to adapt and thrive. That’s where we come in. BIGiOK Consulting is your trusted resource for navigating these emerging trends. We’re here to provide the guidance, expertise and support you need to embrace the new era and seize the opportunities it presents. From tailored training programs to help your team thrive in the knowledge economy, to strategies for creating a cohesive remote work culture, to fostering an inclusive and diverse workforce, we’ve got you covered.

The world around us is changing at an unprecedented pace, but with BIGiOK Consulting by your side, you can confidently navigate these uncharted territories. Together, let’s embrace the changing landscape and shape a future where your independent insurance agency thrives amidst the extraordinary changes of the modern world.

BIGiOK.com

The Power of Connection, con't. continued from page 10

lives, the desire to assist and uplift others is deeply ingrained within us.

It’s why we continue to roll out of bed and show up and pick up the phones even on the hard days. It’s why we find ourselves a part of nonprofits and service-facing industries. It’s why we take a little less and give a little more. And, it’s why we can go home at the end of every day feeling fulfilled even when the “stuff” drains us. By acknowledging and embracing this innate helper nature, we can tap into our full potential and forge connections that have a lasting impact.

The Power of Connection… We’ve all experienced it. The energy, the power and the feeling that comes with true connection. You know the kind. The one Brene Brown talks about when we “derive sustenance and strength from a relationship.” When we come away feeling like we are leaving better than we arrived.

BIGiOK.com

Connection is the key, friends. By forging genuine connections, we create a foundation of trust and understanding. When we take the time to truly see and hear others, we validate their experiences, we come alongside them, no matter the situation, and we make them feel valued. These intentional acts have the ability to make ripples and waves. And if we will pour into our relationships (whether colleagues, clients or otherwise), we have the power to extend beyond our immediate circle to transform our workplaces, communities and the world at large.

facilitating a mastermind group (or even gathering items for a campfire!)

I have the honor of sitting back and observing brilliant people doing the courageous work of reaching out and lifting one another up.

I am lucky enough to see and study the impact of what these intentional acts do every single day. Whether it’s standing in front of a classroom, sitting with a team, coaching with an individual or

Let’s disrupt the workplace by thinking about things a little bit differently.

As helpers at heart, our true fulfillment lies in connecting with and supporting others. By recognizing and embracing this innate desire, we can unleash our potential to make an impact for good.

So, let us strive to connect more…

Let’s come alongside one another.

Let’s change the world.

Let’s just help people.

Fall 2023 | POLICY

21

CHRIS-LEEF GENERAL AGENCY Your home for Cyber Risks Learn about Cyber Liability & connect with our experts Submit a Cyber App online with just a few questions w w w. c h r i s - l e e f. c o m

22 POLICY | Fall 2023

BIGiOK.com

From the State Insurance Commissioner

Rising Homeowners Insurance Rates Nationally and the Implications for Oklahoma The nationwide trend of rising homeowners’ insurance rates has been a cause for concern, impacting the financial security of homeowners across the United States, including Oklahoma.

These increases directly affect individuals and families who rely on insurance coverage to safeguard their homes and belongings from unforeseen events. Homeowners insurance offers financial protection by covering losses or property damage resulting from unexpected, covered problems. In exchange for this coverage, homeowners pay an annual premium, which can vary from year to year.

Over the past five years, homeowner insurance premiums in the United States have steadily increased, and between 2018 and 2023, they have risen by a cumulative 19.1%.

In 2023, homeowners can expect to see an average increase of 7.1% in their premiums. Various factors contribute to these escalating rates, including the growing frequency of extreme weather events, such as natural disasters, as well as the lasting effects of the pandemic, location-based risks and the sluggish economy.

When material and labor costs rise, insurance premiums also tend to increase. For instance, between 2020 and 2022, supply chain disruptions caused by the pandemic, coupled with high demand, led to a 33.9% surge in the price of residential construction materials, as reported by the Bureau of Labor Statistics.

Many Oklahomans have the misconception that the Oklahoma Insurance Department approves insurance rates for Oklahoma. While we do regulate all lines of insurance, we do not have the authority by the state BIGiOK.com

of Oklahoma to control rates used by insurers. To determine homeowners' policy rates, insurers assess factors such as the cost of rebuilding the structure (including lumber, labor and other variables), the property's location, the state of the real estate market and the frequency of natural disasters.

In the first two-and-a-half months of 2023, the top three states with the highest rate increases were New Mexico (8.3%), Arizona (8.2%) and South Dakota (7.3%). These states had experienced weather or climate-related disaster events in 2022, resulting in damages or costs exceeding $1 billion.

While the national average for rate increases in 2022 stood at 4.9%, individual states witnessed varying experiences. The three states with the highest rate increases in that year were North Carolina (12.4%), Oklahoma (11.2%) and Arizona (11.0%). In 2022, natural catastrophes in the United States led to $98.9 billion in insured losses.

Homeowners cannot control the premiums set by insurance companies, but there are steps they can take to potentially lower their rates. Here are a few strategies to consider: • Comparison shopping • Searching for discounts • Exploring payment options • Raising the deductible. By increasing the deductible from $500 to $1,000, homeowners may be able to reduce the cost of their homeowners’ insurance by an average of 6%.

But don’t forgo risk protection. Two out of every three homes in America are uninsured. With insurance premiums skyrocketing, homeowners are cutting back even further on coverage, putting them at further risk when severe weather strikes. While most mortgage lenders

Glen Mulready State Insurance Commissioner

require homeowners to carry insurance, most policies do not cover floods. Those who might be cutting back may opt out of flood insurance, which could be a big mistake.

If you need help understanding your policies, determining whether you need specific coverage, or comparing your premiums and coverage options, OID's Consumer Assistance Division can help.

OID has resources to help consumers make informed decisions about their insurance coverage. We can answer any insurance questions, help with problems, and explain how to file a complaint against an insurance company or agent.

To learn more about how the Oklahoma Insurance Department can help, or to find resources on making sure you’re properly protected, visit oid.ok.gov/consumers/insurance-basics or call 800-522-0071.

Resources: Kurt Cagle AAA valuepenguin.com/homeowners-insurance-ratesstudy Home Insurance Premiums Rise as Americans Flock to Weather-Worn States - The New York Times (nytimes.com)

Fall 2023 | POLICY

23

Inadequate Limits

Inadequate Limits

To Avoid Possible Lawsuit, Remember to Document, Document, Document

By Brendan McNeal

A customer has requested a policy and you have procured a quote. The coverage looks good. The deductible looks good. Most importantly to your customer, the premium looks good.

Coverage is bound.

loss amount – and a straightforward claim suddenly becomes an errors & omissions claim, with the spotlight on your agency and the question from your customer ringing in your ears: How am I not fully covered?

Time goes by, a year or two. Maybe 10. Then there’s a loss. A claim is filed and fortunately, there’s coverage.

But there’s a snag: The policy limits don’t cover the full loss amount – or what your customer thinks is the full

Limits – or rather, inadequate limits – are an all-too-common claim in independent insurance agency E&O. With inflation today outstripping even the inflation guards inserted

24 POLICY | Fall 2023

on some policies, these claims are becoming more frequent.

But inflation is not the only reason for these types of claims. Often enough, a cost-conscious customer requests lower limits and is pleased to pay a lower premium … until a loss occurs, and they are faced with the gulf between the estimated loss and the coverage available to them.

In these instances, the customer does not remember that they were happy BIGiOK.com

Inadequate Limits with these lower limits or appreciate the relationship between higher limits and higher premiums, or even recall that they requested those limits in the first place.

When the rubber meets the road, customers want their insurance claims paid in full and are willing to file a complaint with the Department of Insurance or trigger a lawsuit against their agents if they aren’t satisfied.

What should an agent do?

Document. Document. Document.

As with any E&O claim, documentation can be of great assistance to the agency. Assuming, of course, there was no agency error.

Sometimes, the policy documents are enough to get an agency over the

In these cases, the agency can still be successfully defended, but it takes substantially more time and money to do so.

This is where good documentation comes in. Documents that clearly show an insured understands their policy and their limits can expedite the resolution of an E&O claim or prevent one altogether.

In the event of a claim, a customer who signed a document stating that they have read their policy and agree with the limits at policy procurement or renewal will have a much more difficult time arguing that their limits were inadequate. Written correspondence, such as an email confirmation, can achieve something similar.

With policy limits, it is truly a matter of taking a little extra time now to save you lots of time – and headaches – in the future.” line, either because a state imposes a duty to read on policyholders or because the sheer weight of such evidence suggests the customer could not reasonably argue they wanted something different. For instance, a customer who purchased a $250,000 limit 10 years ago with incremental increases over time, may find it hard to argue they wanted a $500,000 limit instead.

The problem, however, is many states don’t impose a duty to read on policyholders. Customers or their attorneys often find ways to argue around inconvenient facts – like a policy that’s been in place for many years – and make the case that the customer requested higher limits over the phone or in person or that the customer requested the same policy as they had previously and it wasn’t done.

BIGiOK.com

The point of these documents is to unequivocally show that an insured understood and agreed with their policy limits. Also, remember to never recommend a limit amount and always include a disclaimer that “higher limits are available upon request.”

Cari Senefsky Director of Professional Liability

Corporation, Kansas City, Missouri, a member of Swiss Re Corporate Solutions.

This article is intended to be used for general informational purposes only and is not to be relied upon or used for any particular purpose. Swiss Re shall not be held responsible in any way for, and specifically disclaims any liability arising out of or in any way connected to, reliance on or use of any of the information contained or referenced in this article.

The information contained or referenced in this article is not intended to constitute and should not be considered legal, accounting, or professional advice, nor shall it serve as a substitute for the recipient obtaining such advice. The views expressed in this article do not necessarily represent the views of the Swiss Re Group (“Swiss Re”) and/or its subsidiaries and/or management and/or shareholders.

With policy limits, it is truly a matter of taking a little extra time now to save you lots of time – and headaches – in the future.

For more information about BIGiOK’s E&O program, please contact Cari Senefsky at eo@BIGiOK.com, or you can visit our website at BIGiOK.com/ EO. Brendan McNeal is an assistant vice president and claims specialist with Swiss Re Corporate Solutions and works out of the office in Kansas City, Missouri.

Insurance products underwritten by Swiss Re Corporate Solutions America Insurance Fall 2023 | POLICY

25

WHAT DOES RELIABILITY MEAN TO YOU? To us, it means being there every step of the way.

At Stonetrust, we value relationships and work hard to be a great partner for our agents—and that makes all the difference.

Consider Stonetrust as your “first choice” for workers’ compensation coverage.

RATED AEXCELLENT

800.311.0997 | STONETRUSTINSURANCE.COM

Newsmakers

BIGiOK President/CEO Denise Johnson Named to Prestigious Elite Women List Denise Johnson, president/CEO of BIGiOK and a distinguished leader in the insurance industry, has been recognized as one of the top 54 Elite Women Award winners in 2023 by Insurance Business magazine.

and in fostering a more inclusive and diverse landscape within the industry.

Denise's outstanding qualifications, extensive experience and noteworthy contributions toward driving advancements in diversity and inclusion earned her this welldeserved honor.

This recognition reflects Denise's commitment to excellence, innovation and her significant contributions to the insurance sector. Through her leadership and unwavering dedication, Denise has not only achieved notable milestones but has also paved the way for others to thrive in the industry.

The Elite Women Award highlights individuals who have demonstrated remarkable achievements and long-standing dedication to the insurance industry. Denise’s impressive track record and expertise have made a significant impact, both in her professional endeavors

Please join us in extending our warmest congratulations to Denise on this exceptional achievement. Her success serves as an inspiration to aspiring professionals and reaffirms her invaluable presence within Big I Oklahoma and the state and national insurance industry.

Denise Johnson, CISR, CIC BIGiOK President/Chief Executive Officer

BIGiOK YAC Krista Kautz Featured in Magazine Krista Kautz, the new BIGiOK Young Agents of Oklahoma chair, was featured along with nine other young agents across the nation in an article that appeared in the June edition of the national "Big I Independent Agent" magazine.

Titled “Listen Up: Meet 10 Young Agents 35 and Other” (by AnneMarie McPherson Spears), the focus of the story was on what this next generation of agents has to say about where the industry is headed—and how they fit into it.

In the article, Krista, 29, a commercial lines producer for Berrong Insurance in Edmond, identified perpetuation as a top industry challenge.

BIGiOK.com

“Are agencies willing to allow an employee to come up and take over the agency, or would they rather sell and be acquired?” she asks. “Even if it's not keeping the agency ‘in the family,’ agencies should try to stay ‘family owned and operated’ by redefining that term. Employers claim that their employees are part of their family, so why not treat it that way and pass that legacy down to them?

No one's going to know that legacy better than the people that have helped to uphold it.”

Visit www.bigiok.com/2023iamagazine-kristakautz to read the entire article.

Fall 2023 | POLICY

27

Newsmakers

Celebrating Excellence: BIGiOK's Josh Reasnor Named 2023 Association Professional of the Year In a celebration of excellence, the Oklahoma Society of Association Executives awarded the prestigious 2023 Association Professional of the Year to Josh Reasnor, a key figure at the Big I of Oklahoma. Held at the River Spirit Casino in Tulsa, the annual OSAE conference on July 17 marked a milestone for Association professionals across the state, coming together to acknowledge outstanding contributions in the association management realm.

The OSAE, established in 1963 with a vision to unite and empower association professionals throughout Oklahoma, has continued to foster

growth and knowledge sharing within this dynamic community. As an emerging executive, Josh shared his appreciation for the Association's invaluable support during his journey with BIGiOK. “It’s always nice to be recognized by your peers,” he said. “OSAE has been a great learning experience and resource for me as a new executive.

They have taken me under their wing and have given me a lot of really good advice that I have been able to bring back to our organization.” I am grateful to be a part of the group and be recognized.”

Josh Reasnor BIGiOK Chief of Staff and Operations

Omega Insurance’s Kailea McGehee Named Oklahoma Outstanding CSR of the Year Each year, a group of exceptional insurance professionals are selected by the National Alliance for Insurance Education & Research to represent their states and then compete to become the National Outstanding CSR of the Year. This prestigious award, regarded as the foremost national award of its kind, recognizes the contributions and commitment of those who serve clients within the insurance industry.

Kailea McGehee, of Omega Insurance Agency in Choctaw, was selected from Oklahoma for this honor in 2023.

28 POLICY | Fall 2023

To be eligible for the top state honor, the 2023 candidates submitted an essay on the topic, “Empathy is an important aspect of customerfacing jobs, and it will only become more important as companies place a greater emphasis on making customer interactions feel natural and effective.” Additionally, entrants must have demonstrated commendable service to their agencies, their industry and their community.

BIGiOK congratulates Kailea on her selection as the state winner and wishes her good luck in the competition for the national honor.

Kailea McGehee BIGiOK.com

Newsmakers

BIGiOK welcomes the KTI Agency from Stillwater!

BIGiOK welcomes TLC Insurance Agency out of Edmond!

Stillwater Young Agents Lunch Bunch

The Young Agents’ lunch bunch had an excellent turnout at Mexico Joe’s in Stillwater. A big thank you to IPFS for sponsoring this luncheon! Don’t forget to register and join us for many upcoming young agents’ events by going to www.bigiok.com/ya

BIGiOK.com

Fall 2023 | POLICY

29

Newsmakers We extend our heartfelt gratitude to all attendees of the Young Agents’ SINGO fundraiser for Peppers Ranch, a foster care community. Together, a grand total of $6,563 was raised for this noble cause! Kudos to those who bravely faced a pie to the face or a dunk in the tank. A special thanks also goes out to Oklahoma Insurance Commissioner Glen Mulready for his participation in the dunk tank. We also express our deepest appreciation to our partner companies that generously donated raffle baskets. It truly was a team effort.

30 POLICY | Fall 2023

BIGiOK.com

Newsmakers

S E R V I N G I N S U R A N C E P R O F E S S I O N A L S S I N C E 19 7 3

EXPAND YOUR BUSINESS WITH

LIFE LINES

Excitement fills the air as the 2023 Future Insurance Leader of Oklahoma Class is underway! While embracing innovation, driving change and cultivating leadership potential in the insurance industry, together, they are rewriting the future. #FutureLeaders #InsuranceInnovators “FILO meet and greet was a great way to get acquainted with our new classmates, meet our mentors, and meet so many members of the Young Agents! It was exciting to meet so many new people who have the same interests and passion for insurance. I’m excited for all the fun experiences to come.” - Megan Vinson, CISR Elite Messer Bowers Insurance.

BIGiOK.com

• E-Applications • E-Delivery • Accelerated Underwriting • Non-Medical Options • Pre-Sale Support • Personal & Business Lines • Term & Permanent

LIFE INSURANCE MADE EASY LIFE DISABILITY LTC FIXED ANNUITIES LIFE SETTLEMENTS

(800)627.3100 TaberBrokerage.com

We Make Doing Business Easy.

Fall 2023 | POLICY

31

We’re sure other networks are great.

But do they come with all the extras?

Aggregation? Check. National carrier contracts? Check.

Basic networks can do a lot for an agency.

Keystone does all that and more.

Learn more about what Keystone can sprinkle into your agency offerings

©2023 Keystone Insurers Group ®. All rights reserved.

This does not constitute an offer to sell a franchise in any state in which the Keystone Insurers Group franchise is not registered.

YES WAY.

From time to time we meet a Big “I” member who hasn’t yet learned about the market access solutions available through Big “I” membership. After hearing about our stellar product lineup and competitive commissions, the reaction can often be summed up as, “No way!” But we assure you–yes way.

Big “I” Markets, featuring Big “I” Eagle Agency, has been working with our member agents to make insurance magic since 2002. As part of your national association, it’s our mission to bring you the best solutions to help your agency thrive. We know you because we are you. Find out how to plug into the power of cyber, affluent, bonds, umbrella, standard & non-standard personal lines, and small commercial today.

No fees. No minimums. Own your expirations.

BIGIMARKETS.COM

The Bank Soundness Question

The Bank Soundness Question: What It Means for Agents

By David W. Tralka

Many independent agents have watched with concern as a small number of high-profile banks have faltered during 2023.

Just what does this shock to the banking system mean to independent agents and brokers throughout the country?

34 POLICY | Fall 2023

The soundness of the banking system, frankly, is not something that most independent agency principals spend time thinking about.

But since these issues have arisen, it’s important for agency leaders to navigate the issue. I see four takeaways as relevant to agents in the current environment.

1. The problems leading to the notable bank failures were specific to those few banks. America’s strong bank depositor protections responded to those situations, and healthy banks stepped up to absorb the assets and liabilities of the troubled banks. The protections in place worked. It appears that issues BIGiOK.com

The Bank Soundness Question

3. The competitive pressures that all banks face will lead them to narrow their lending activity. For businesses such as independent agencies that present a different business model than other business borrowers, credit availability may be significantly curtailed.

4. Agents should speak to their financial institution and ask questions about deposit insurance protection, bank liquidity and capital ratios.

Many banks today face challenges to earnings and balance sheet strength.

I expect there will be a fair number of banks posting lower profits in coming quarters. That’s a long way from saying they might fail, but it does mean they could change the way they operate. This could affect the way banking relationships work for independent agencies.

In this environment, independent agency principals may expect banks to shy away from lending for agency perpetuation, new producer development and acquisitions. New loans, when available, likely will cost more.

in the banking system have been contained.

2. While the distress has been limited to a few institutions, the rising interest rate environment of 2022-2023 has put many banks under pressure. Banks, which always face competitive pressure to offer favorable interest rates for deposit products and appealing credit terms for loans, now must do so in a market that is challenging to their earnings model.

BIGiOK.com

For years, I’ve seen many banks avoid independent agencies as borrowers.

Bank lenders tend to have little appreciation for the enterprise value of an independent agency and tend to discount the value associated with an agency’s policy renewals, client retention, carrier relationships and loss experience. Faced with recent events and the forecast of higher interest rates, I don’t expect banks to suddenly change their perception of independent agencies.

Even as some banks tighten lending, institutions that truly understand

the agency financial model will continue to be active lenders. Banks that exhibit strong earnings, liquidity and available capital will have the financial flexibility to continue providing capital to independent agencies.

Independent agency principals tend to be fiscally conservative. They’ve weathered crises large and small, and they’re used to sleeping well at night.

It makes sense for agency owners to ask questions of the banks they’re doing business with. In addition to asking about financial soundness, now is a good time to ask about their current and future appetite for agency lending.

If you are an agency principal, there is one last point to consider about your own financial picture. Any agency owner who has taken out a loan in recent years should carefully review their loan terms and conditions.

Numerous agency loans have been made at floating rates based on the prime rate. With interest rates sharply higher over the past two years, loan payments may be significantly higher. You can use the current yield curve to your advantage by thinking about refinancing to a fixed rate loan. In many cases, a medium-term fixed rate may be lower than the floating rate you currently have.

A lender that is knowledgeable about the independent insurance agency channel can quickly identify opportunities to save on future interest costs.

[This article originally appeared in the July 17, 2023, issue of Insurance Journal.]

Fall 2023 | POLICY

35

DIAMOND DELUXE PARTNERS

PLATINUM PARTNERS

ALWAYS THANKFUL FOR THE SUPPORT OF THESE GREAT PARTNERS. BIGIOK.COM/PARTNERS

GOLD PARTNERS

Chubb AndDone CNA Insurance Travelers Insurance Zenith Insurance Company EMC Insurance

ICW Group AmTrust North America Oklahoma Agents Alliance DBA: One Agents Alliance Union Mutual Insurance Company Accident Fund, United Heartland & Third Coast Underwriters

SILVER PARTNERS

National American Insurance Company (NAICO) Iroquois Group Normandy Insurance Company Smart Choice Berkley Aspire

The Hanover Insurance Group ~ The Hartford ~ Cornerstone National Insurance ~ BRONZE PARTNERS HawkSoft ~ Southwest Risk, LP ~ AMERISAFE ~ Pie Insurance ~ Berkshire Hathaway GUARD Insurance Companies ~ Specialty Insurance Managers of OK Inc ~ Employers ~ Burns & Wilcox ~ Comp21 ~ Skyward Specialty Insurance ~ Patriot National Underwriters, Inc. ~ Equity Insurance Company ~ CRC Insurance Services ~ Central Insurance Company ~ Hallmark Financial Services, Inc. ~ National General, an Allstate company ~ Taber Brokerage ~ Producers XL ~ Stonetrust Workers’ Compensation ~ Berkley Management Protection ~ Gainsco Auto Insurance ~ Farmers Alliance Mutual Insurance Company ~ Main Street America Insurance ~ Risk Placement Services, Inc. ~ RT Specialty ~ Keystone ~ Openly ~ Jencap Insurance Group ~ Traders Insurance Company ~ Philadelphia Insurance Companies ~ Columbia Insurance Group ~ Convelo Insurance Group ~ Markel ~ Med James, Inc. ~ Chris-Leef General Agency, Inc ~ WORKS24 ~ Peoples Premium Finance ~ ePayPolicy ~ Johnson & Johnson ~ Equipment Insurance International ~ Berkshire Hathaway Homestate Companies (BHHC) ~ Savvital ~ AFCO Premium Finance ~ Sola Insurance ~ Old Republic Surety Company ~ State Auto Insurance ~ HoundDog - COI Tracking Automation ~ BondExchange

Reserved for IPFS