Wisconsin Independent Agent August 2020 Magazine

wisconsin INDEPENDENT AGENT AUGUST 2020

COMING SOON ONLINE COMMUNITY A NEW PLATFORM TO: CONNECT COLLABORATE ENGAGE

wisconsin INDEPENDENT AGENT CONTENTS

Independent Insurance Agents of Wisconsin 725 John Nolen Drive Madison, Wisconsin 53713 Phone: (608) 256-4429 Fax: (608) 256-0170 www.iiaw.com

3, 4, 5, 6......Supporting Company Members - Partner-Level Profiles & Ads 10,11...........Insurance Bartender

Connect, Collaborate, Engage

2019-2020 EXECUTIVE COMMITTEE

12,13...........Risky Business

President: Chris Costakis Midwest Insurance Group LLC, Delafield

Determining the Value of a Property

President-Elect: Darrel Zaleski Spectrum Insurance Group, Eau Claire

16................Errors & Omissions Negligent Referrals and You

Secretary-Treasurer: Marc Petersen American Advantage - Petersen Group

19................Virtual University Illinois DOI ‘Requests’ Insurers Not Apply Policy Provisions

New Berlin

21................Government Affairs

Chairman of the Board: Jason Bott Robertson-Ryan & Associates, Milwaukee

Workers’ Compensation and Liability for COVID-19 22, 23..........Virtual University Does Requiring Customers to Wear Masks Have Any Effect on Legal Liability?

State National Director: Steve Leitch Leitch Insurance, River Falls

25................Errors & Omissions

Mike Ansay Ansay & Associates, Port Washington Nick Arnoldy Marshfield Insurance Agency, Inc., Marshfield Mike Harrison R&R Insurance Services, Inc., Waukesha Ryan Leitch Leitch Insurance, River Falls Aaron Marsh Marsh Insurance Services, Inc., Rice Lake Joanne Lukas Szymaszek Johnson Insurance Services, LLC, Racine Chad Tisonik HNI Risk Services, LLC, New Berlin Andrea Nelson Unisource Insurance Associates, LLC,

From the Email Bag: If You’re a Babysitter, Let’s Hope You Don’t

Get Paid Like One.

26, 27..........Members in the News

29................Commentary from Counsel SCOTUS Expands Exception to Employment Claims Against

Religious Institutions

31................Food for Thought

2019-2020 BOARD OF DIRECTORS

Wauwatosa

IIAW STAFF

ADVERTISERS & INFORMATION 18.................AAA 31.................Badger Mutual 24.................Berkshire Hathaway GUARD 7...................DAIS 30.................EMC 11.................Erickson Larsen 9...................IIAW CE Education Calendar 32.................IMT 8...................Penn National Mutual 13.................Robertson Ryan & Associates 14-15............SFM 28.................Society Insurance 17.................West Bend 20.................Western National

Wisconsin Independent Agent is the official magazine of the Independent Insurance Agents of Wisconsin (IIAW) and is published monthly by IIAW 725 John Nolen Drive, Madison WI 53713. Phone: 608.256-4429. IIAW does not necessarily endorse any of the companies advertising in publication or the views of the writers. IIAW reserves the right, in its sole discretion, to reject advertising that does not meet IIAW qualifications or which may detract from its business, professional or ethical standards. © 2020 For information on advertising, contact Kaylyn Zielinski, 608.210.2977 or kaylyn@iiaw.com.

2

| AUGUST 2020 |

wisconsin INDEPENDENT AGENT

Matt Banaszynski Chief Executive Officer 608.256.4429 | matt@iiaw.com Mallory Cornell Vice President and Director of Risk Management 608.210.2975 | mallory@iiaw.com Kim Kramp Association and Agency Accounting Manager 608.210.2976 | kim@iiaw.com Trisha Ours Director of Insurance Services 608.210.2973 | trisha@iiaw.com Kaylyn Zielinski | Marketing Specialist 608.210.2977 | kaylyn@iiaw.com Evan Leitch Technology and Risk Advisor 608.210.2971 | evan@iiaw.com Diana Banaszynski Education Coordinator 608.256.4429 | diana@iiaw.com

On The Cover...

Later this fall, the IIAW will be launching a new online “curated” community and app where members can seek out and engage with other members/stakeholders within the association or with association staff/experts. Post questions, topics, and articles for feedback from other agency staff, insurance company employees, vendors, or IIAW staff. Search past posts or blogs to obtain valuable information quickly and easily. This platform seeks to bring insurance professionals together in a virtual curated format to provide a more cohesive, comprehensive, and responsive community environment to meet the evolving needs of our Association’s members, sponsors and stakeholders.

Thank you, Partners!

WORKERS’ COMP IS ALL WE DO. CONSTRUCTION ROOFING AGRIBUSINESS WOOD PRODUCTS TRUCKING MANUFACTURING

800.897.9719 - amerisafe.com © 2020 AMERISAFE, Inc. AMERISAFE, the AMERISAFE Logo, and SAFE ABOVE ALL are registered trademarks of AMERISAFE, Inc. All rights reserved.

Company Name: Auto-Owners Insurance

Location of Company: Lansing, Michigan Date Company Was Founded: July 1, 1916 Current Officers: • Jeff Tagsold, Chairman & CEO • Dan Thelen, President • Mike Pike, Executive Vice President Products Company Specializes In: A wide range of preferred personal, commercial and farm products. Auto-Owners also specializes in garage risks, contractors, light manufacturing, and commercial auto including trucking as well as

main street BOP business. We also offer loss control services within the state of Wisconsin. We offer a full range of life, health and annuity products taking care of all our policyholders needs.

Outlook for The Company’s Future: Our company’s goal for the future is to continue to provide a wide array of insurance products and protection at very competitive prices. We will continue to be committed to the independent agency system in marketing our products. We’ve grown to become the 15th largest property & casualty company in the nation. We look forward to continued growth, in part due to our acquisition of Atlantic Casualty Insurance Company, an excess and surplus lines company, in 2016; our affiliation with Concord General Mutual Insurance in 2017; and our acquisition of Capital Insurance Group in 2019.

wisconsin INDEPENDENT AGENT

| AUGUST 2020 | 3

Thank you, Partners!

Company Name: CNA

Location of Company: CNA Wisconsin 10000 Innovation Drive, Suite 320 Wauwatosa, WI 53226 Date Company Was Founded: 1897 Current Officers: • Dino E. Robusto, Chairman and Chief Executive Officer • Douglas M. Worman, Executive Vice President and Chief Underwriting Officer Local Leadership: • Kristina Talkowski, Branch Manager, CNA Wisconsin Email: kristina.talkowski@cna.com Phone: 414-844-2544

Products Company Specializes In: In addition to our broad appetite for business risks, CNA focuses on construction, manufacturing, technology, healthcare, professional services, financial institutions, real estate and small business. The breadth of our product portfolio enables CNA to provide customized insurance solutions that anticipate and address our customers’ risks.

Outlook for The Company’s Future: We know your time is valuable. You expect to work with insurance specialists who have the expertise and understanding of their clients’ business needs, and can deliver full and meaningful solutions. CNA Wisconsin’s experienced branch staff is ready to respond to the needs of you and your clients. With a powerful legacy, an international reach built on a strong local presence, well-known business insurance expertise, and a deep commitment to our agents, brokers and customers, we offer more than just a policy - we deliver distinctive insurance solutions and promise a superior customer experience. It is these core attributes and our relationships with you that provide a strong foundation for continued mutual growth.

COVERAGE TO PROTECT WHAT YOU CARE ABOUT MOST We can encircle you with custom-tailored insurance to meet your unique needs. Our auto, home, life and business insurance, including workers’ compensation, ensure you are protected when you need it most.

We are Encova Insurance.

encova.com 4

| AUGUST 2020 |

wisconsin INDEPENDENT AGENT

Thank you, Partners!

Company Name: Philadelphia Insurance Companies

Location of Company: Bala Cynwyd, PA Date Company Was Founded: 1962 Current Officers: • Bob O’Leary.- Chairman & CEO • Brian O’Reilly- EVP and Chief Marketing Officer • John Glomb- President and Co-Chief Underwriting Officer • Bill Benecke- EVP and Chief Claims Officer • James Maguire - Special Advisor

Products Company Specializes In: PHLY specializes in 120= niche markets including: Commercial Auto, Cyber Security, Education, Entertainment & Recreation, Habitational, Health & Fitness; Non-Profit and Human Services, Outdoor Products, Public Services, Real Estate, Special Events, Sports, Management & Professional Liability, Surety, E&S, Antique Auto, and Commercial Flood.

Outlook for The Company’s Future: AM Best Rating is A++ Superior/XV. S&P Rating is A+.

wisconsin INDEPENDENT AGENT

| AUGUST 2020 | 5

Thank you, Partners!

Company Name: Wisconsin Mutual Insurance Headquarters: Madison, WI

policyholders and that has led to more coverage options, endorsements, and socialized programs. Our personal lines products include auto, home, umbrella and farm.

In addition, Wisconsin Mutual is proud to support the small to medium size farms that are so critical to Wisconsin and Minnesota. We grow in this market segment every year, and pride ourselves on the local expertise we can offer farmers in the communities we serve.

Founded: 1903 Executives: • Dan Keyes, President/CEO • Holly Casavant, Corporate Secretary/HR Director • Ryan Strohm, Assistant Treasurer • Kellye Golden, Vice President Products Company Specializes in: WMI has written personal lines insurance in Wisconsin, and recently Minnesota, through independent agents for over 100 years. Throughout this time we have focused on customer service and the “human touch” that allows our policyholders to have confidence in the insurance process and our partnership. Calls are answered by a person who directs them to the WMI specialist that can best service their needs, not an endless automated system. However, we also appreciate the convenience that technology offers and are constantly working to offer new online tools.

We continue to focus on the changing needs of our

Our commercial book of business in tailored for small to medium size residential accounts and small artisan contractors.

Outlook for the Company’s Future: Wisconsin Mutual’s strong performance is a product of the contributions of our dedicated employees and agents providing exceptional customer service to our policyholders through both person-to-person interaction and the effective use of technology. Finding a balance between maintaining our industry-leading expense ratio and continuing to invest in and cultivate the use of technology, is a strong focus in our immediate future.

Comments: Independent Agents interested in learning more about WMI should contact our Marketing Representative, Caleb Fredrickson at 608-828-1403 or Vice President, Kellye Golden at 608-828-1431.

Company Website: Learn more on our website at www.wiins.com.

Thank you to all of our Partner-level Supporting Company Members!

6

| AUGUST 2020 |

wisconsin INDEPENDENT AGENT

In 1919, A group of Pennsylvania farmers founded Penn National Insurance to provide affordable workers’ compensation insurance.

Today, Penn National Insurance sells property-casualty insurance in 11 states by partnering with more than 1,200 independent agency operations. In 2012, we affiliated with Wisconsin-based, Partners Mutual Insurance Company. As one company, we bring the personal attention and local focus of a regional carrier, along with the quality of products and services of national carriers.

Interested in partnering with a thriving insurance carrier with superior customer experience? We are looking for select commercial lines-oriented agencies in Wisconsin.

Contact: Vicki Lentz 262-432-3420 vlentz@pnat.com

Clayton Zogata 262.432-3422 czogata@pnat.com

• Strong financial performance and A.M. Best Financial Strength Rating of A• Expanded Commercial Lines product and services with competitive pricing and comprehensive coverages to help our agents grow profitably.

• Comprehensive Personal Lines product offerings, including Homeowners Equipment Breakdown and additional protection plans.

• State-of-the-art quoting, processing and self-service tools, making is easier and faster to meet your customers’ needs.

• Local experienced underwriting, claims and management staff

An Equal Employment Opportunity/Affirmative Action Employer ©2020 Penn National Insurance

Policies issued for domiciled businesses and individuals in Wisconsin and Iowa are underwritten under our affiliate, Partners Mutual Insurance Company.

CONTINUING

EDUCATION IIAW ONLINE EDUCATION & CE CLASSES 2020 DATE

TIME

COURSE

AUGUST 06 10 11 12 13 17 19 20 24 25 25 26 27

12PM-3PM 12PM-3PM 12PM-3PM 12PM-3PM 12PM-3PM 12PM-3PM 12PM-3PM 12PM-3PM 12PM-3PM 8AM-11AM 12PM-3PM 12PM-3PM 12PM-3PM

Protecting Your Most Valuable Asset Dispelling the Myths of Workers’ Compensation Personal Auto Policy Homeowner Hot Topics... What You Need To Know E&O: Commercial Property Coverage Gaps & How To Fill Them Condominiums Additional Insureds and Certificates of Insurance Ethical Dilemmas... Making The Right Choices The Dirty Dozen E&O: Roadmap to Personal Auto and Umbrella Insurance Workers’ Compensation Insuring Trusts - Protecting Your Client’s Wishes Farm Property Coverages

SEPTEMBER 02 03 09 10 10 14 21 22 23 24 28 29

12PM-3PM 12PM-3PM 12PM-3PM 8AM-11AM 12PM-3PM 12PM-3PM 12PM-3PM 8AM-11AM 12PM-3PM 12PM-3PM 12PM-3PM 12PM-3PM

Contractual Liability... Separating Fact from Fiction Top 10 Countdown of Personal Lines Coverages & Current Issues Risk Assessment for Manufacturing Operations - What Can Go Wrong?

Farm Vehicle and Equipment Coverages E&O: Roadmap to Homeowners Insurance Commercial Property Coverages Business Income - Coverage Analysis Through Claims Income After Retirement - Where Does the Money Come From?

Ethics and Agent Liability E&O: Commercial Liability Coverage Gaps & How To Fill Them It’s Not My Fault, or Is It? - Liability Issues in Personal Lines Policies Insurance Valuation Strategies

For more information and to register for these classes, visit iiaw.com/education.

QUESTIONS? CONTACT IIAW AT 608-256-4429 OR AT DIANA@IIAW.COM wisconsin INDEPENDENT AGENT

| AUGUST 2020 | 9

INSURANCE BARTENDER

CONNECT, COLLABORATE, ENGAGE Henry Ford famously said, “Coming Together is a beginning, Staying together is progress, and Working together is success.” You have likely seen this quote a lot from the IIAW as it perfectly illustrates the type of community the IIAW is working to build among its members and stakeholders. An ecosystem of insurance professionals and solutions to help drive the industry to new heights.

Historically, the IIAW has brought together its members in the form of meetings, events, and conventions/conferences. In the COVID-19 environment that exists now, in-person gatherings can be difficult and risky, but the need to connect, collaborate and engage with other individuals has never been greater.

Raspberry Beer Cocktail

That is why, later this fall, the IIAW will be launching a new online “curated” community with an app where members can seek out and engage with other members/stakeholders within the association or with association staff/experts. Post questions, topics, and articles for feedback from other agency staff, insurance company employees, vendors, or staff. Search past posts or blogs to obtain valuable information quickly and easily. This platform seeks to bring insurance professionals together in a virtual curated format to provide a more cohesive, comprehensive, and responsive community environment to meet the evolving needs of our Association’s members, sponsors and stakeholders.

Data shows an overwhelming percentage of members only sign-in to renew their dues and register for an event. The Online Community integrates with IIAW’s association management system and website to provide simple and quick access to community features such as blogs, forums, groups, member directories and more. Accessibility and personal

Matt’s Mixology

Fresh or frozen raspberries work equally well in this festive, fruit beer cocktail. This refreshing drink is the perfect sipper for a summer poolside party.

Directions

Ingredients

• 3/4 cup frozen raspberries* • 3 1/2 (12-oz.) bottles beer, chilled • 1 (12-oz.) container frozen raspberry lemonade concentrate, thawed • 1/2 cup vodka • Garnish: lemon and lime slices 10

| AUGUST 2020 |

wisconsin INDEPENDENT AGENT

1. Stir together first 4 ingredients. Service over ice.

Garnish, if desired.

2. Fresh raspberries may be substituted.

3. Note: To make ahead, stir together lemonade concentrate and vodka in a large container. Chill up to 3 days. Stir in raspberries and beer just before serving.

Garnish, if desired.

interaction preferences are key to the platform.

Instead of members interacting and engaging with content and other members in a more traditional format, the IIAW Online Community will tailor its approach to the member by bringing together relevant data and information into an easily consumable and familiar source through the “My Feed” function.

Alerts are also an essential piece of the Online Community platform and SocialLink Mobile App. These Alerts keep the member engaged with instant updates on activity that is happening within their Community Feed and Connections. Alerts can range from updates to a particular post you have made or contributed to as well as Connection requests from other community members. The online community and app will have push notifications/alerts that populate member’s “My Feed” from the backend of the website allowing for the distribution of quick and relevant information.

Gamification is adding game principals or mechanics into nongame environments, like a website, online community, or learning management system to increase participation. The goal of gamification is to encourage the engagement with consumers, employees, and partners to inspire

collaborate, share and interact. The IIAW will be incentivizing participation by integrating gamification into its platform. We will be rewarding users/members for their participation in the form of points that can be redeemed for Amazon gift cards, local merchant gift cards, IIAW swag and more. It’s easy, participate to earn points, cash in those points for cool prizes.

In order for our new Online Community to succeed we need everyone to participate. We sincerely hope that you and your company will join us this fall as we look to inspire, educate, collaborate, engage and connect with insurance professionals across Wisconsin to help drive the industry toward continued prosperity.

“Alone, we can do so little, together we can do so much!”

- Helen Keller

> Matt Banaszynski CEO of IIAW

wisconsin INDEPENDENT AGENT

| AUGUST 2020 | 11

RISKY BUSINESS

DETERMINING THE VALUE OF A PROPERTY Recently, we have seen an E&O claim trend around insurance limits based on values. The customer’s property has not been properly evaluated, but who should be responsible for determining the value? The advice from Swiss Re Corporate Solutions has long been that the customer is responsible for determining the value of the property. The agent should then take the value provided by the customer and provided insurance based on that amount. Many times, the agent takes on the role of the advisor and a customer will look to the agent to assist with the valuation. In this situation, the agent is likely creating a “special relationship” and has greatly increased their standard of care. If agents are using valuation tools, they must realize the answers they provide are only as good as the information that is entered into them. The agent also then assumes the responsibility of making sure the values are regularly updated to reflect any changes to the property.

Here is an example of what can go wrong and what an agency can do to avoid a $2 million E&O claim.

Andrew, an experienced agent at a large insurance agency, placed Commercial Property coverage for his client who was a real estate developer. Among the properties he owned, the real estate developer owned a shopping center. The agent and his client had verbal discussions when the policy was initially placed regarding the value of the property.

According to the agent, the value of the building was ultimately determined by the real estate developer, but nothing was put in writing by the agent to reflect how the value was determined or whether the client agreed with the valuation. The agent procured a replacement cost property policy 12

| AUGUST 2020 |

wisconsin INDEPENDENT AGENT

with $2.5 million in replacement cost for the building.

The policy was then renewed each year for 5 years.

During this time period, neither the agent nor the client re-visited the issue of the valuation of the property or considered or discussed possible increases in the value of the property.

The shopping center then burned to the ground.

When the client submitted the claim, the carrier paid the limit of the policy. However, the property owner claimed that the replacement cost of the property was actually $7MM and claimed that the property was undervalued. The real estate developer admitted receiving the renewals each year but not reading them. He further claimed that he completely relied on his agent to determine the appropriate insurance coverages, that it was the agent that set the initial value of the property and that the agent never recommended an appraisal at any point. The real estate developer proceeded to file suit against Andrew and his agency.

What are the major issues in this case?

• Agent’s failure to document property valuation process in writing • Agent’s undertaking to set the value of the property when that is potentially outside his/her area of expertise and the agent may not have a duty to undertake this task. In addition, the property owner is in a superior position to know the value of his/her own property • An insurance broker is not required to ascertain the levels of coverage for a risk. However, if the agent

assumed this obligation even though he didn’t have to, he thereby created a special relationship that obligated him/her to exercise a greater degree of care and diligence.

• Agent’s failure to consider and discuss increases in value of the property over time i.e. by not performing a yearly analysis of coverages and making necessary modifications to the level of coverage.

If your agency needs to review internal processes such as property valuations, please call IIAW Vice President, Mallory Cornell. There could even be E&O premium savings for your proactive E&O Risk Management!

What could have been done differently by the agency?

• Yearly review of property values with sign off by client • Written documentation of valuation with client sign-off • Written recommendation that the client have the property appraised What do you think was the outcome?

The case was tried and the agent paid almost $2MM in damages for taking on the responsibility of valuing the property and not doing it properly as well as failing to review the value.

> Mallory Cornell,

IIAW Vice President and Director of Risk Management

JOIN US, a WI Based Top 100 Agency

Are you or your agency ready for a positive change?

Robertson Ryan has been offering innovation through our unique Agent Owner structure since inception in 1960. Time and time again after an agent or agency joins us they say, “We wish we did this years ago.” Our team recognizes the strength and power behind the agent and insured relationships so we’ve built, and continue to fine-tune, a support network rewarding those affiliated with RRA. Find more at, www.RobertsonRyan.com/AgentOwner ...and let’s connect. Call or email me 414.221.0363 or cillman@robertsonryan.com. I look forward to answering your questions!

Chris Illman, CEO

www.RobertsonRyan.com wisconsin INDEPENDENT AGENT

| AUGUST 2020 | 13

It’s time to

get out of the

‘Pool’

Class Code 0006 0008 0042 5022 5102 5183 5190 5403 5445 5474 5537 7219 7231 7600 7605 8215 8279 8381 8742 8824 8835

Class Description Farm products — raising, harvesting and preparing for the market including driving Farm gardening — market or truck and drivers Landscape gardening and drivers (no above ground tree trimming) Masonry NOC Door and window installation — all types — residential and commercial Plumbing NOC and drivers Electrical wiring — wiring — within buildings and drivers Carpentry NOC (no roofing) Wallboard, sheetrock, drywall, plasterboard or cement board installation Painting or paperhanging NOC and shop operations, drivers (no lead paint abatement) Heating ventilation air-conditioning and refrigeration systems installation Trucking — NOC (no log, munitions, or liquid propane haulers) Mail, parcel or package delivery and courier or messenger service companies Telecommunications companies — all other employees and drivers (no cell tower work) Burglar alarm installation or repair and drivers Feed, fertilizer, hay or grain dealer and local managers, drivers (no manufacturing) Stable or breeding farm and drivers (no race competitions, rodeos or sportsman events) Gasoline station — retail, self-service Salespersons, collectors — outside (no automobile repossession services) Retirement living centers health care employees Home, public and traveling health care — all employees

Class Code 8842 8868 8869 9012 9014 9015 9016 9063 9082 9180 9403

Class Description Group homes — all employees, salespersons, and drivers College professional employees and clerical (smaller institutions only, no sheltered workshops) Child day care center professional employees, clerical and salespersons Building or property management, property managers and leasing agents and clerical Buildings and operations by contractors and drivers Building or property management — all other employees Amusement park or exhibition operations and drivers Exercise or health institution — all employees and clerical (community centers acceptable, excluding YMCA clubs) Restaurant NOC Amusement device operation NOC — not traveling and drivers (no fireworks, racing, skiing, or zip line operations) Garbage, ashes or refuse collection and drivers

ERRORS & OMISSIONS

NEGLIGENT REFERRALS AND YOU Felix has decided to sell his house and contacts Mary, an independent insurance agent, who he knows has been in the community for many years. Felix asks Mary if she knows of a good real estate agent who can help him. Mary tells him she knows the perfect person, Rusty Nail at Nail Real Estate. Mary doesn’t hear from Felix until about 3 months later when Felix calls her and relates the following story.

Rusty advised Felix that an open house would be a good way to show the house to prospective buyers and that it would best for Felix to be out of the house during that weekend. When Felix returned, the interior of the house had been destroyed. Felix learned that Rusty had a party that left Felix’s house in shambles with damages in excess of $10,000. When Felix approached Rusty to pay for the damages, Rusty responded that he in fact was not a real estate agent, that his license had been suspended for 3 years and he had no insurance to cover the damages.

Felix blamed Mary’s recommendation of Rusty for the damages and threatened to file suit against her. Mary then reported the claim to her errors & omissions carrier. Is this covered? The Swiss Re Insurance Agents Errors and Omissions policy provides coverage for claims arising out of “professional services” rendered to others.

“Professional Services” is defined to include activities as a managing general insurance agent, general insurance agent,insurance agent or 16

| AUGUST 2020 |

wisconsin INDEPENDENT AGENT

insurance broker. As a general rule, referring a customer to a third person or entity unrelated to the insurance products provided by the agency is not considered “professional services” under the policy. In this case, the claim for negligent referral against Mary would not be covered under her insurance agent’s errors & omissions policy.

What can you do to protect yourself in this type of situation? There are several options.

1. Risk avoidance - decide you are not going to continue providing referrals 2. Risk mitigation - continue providing referrals, but offer several names and be sure to include a statement or statements that specifies the scope and limits of what you are providing; for example, that the person getting your referral should look into the qualifications of anyone they choose to use to be sure their needs and requirements are met.

You should consult with an attorney licensed in your state as to the use of and the specific language of a disclaimer and the legal effect of such language.

Unfortunately, sometimes it just doesn’t pay to be nice, and in fact it can cost you. > Richard F. Lund, JD

President, Americas Property and Casualty, SwissRE

The Silver Lining® shines through on claims survey West Bend is Number 12 and earns B+ on Crash Network’s 2020 Insurer Report Card

When more than 1,000 collision repair shops around the country graded auto insurers on how they handle claims, West Bend ranked Number 12 of 79 and earned a B+ rating!

This ranking highlights West Bend’s exemplary claims service, not just price and brand recognition. We’re proud to be included on this list as it shows repair shops how we take care of our customers.

Crash Network is an independent source of news, views, and information vital to the collision industry. Find out more at https://www.crashnetwork.com/irc.php.

Don’t just join a company, join a club.

AAA is a membership-based organization; we’re a club, not just a company. This means we have an entirely different level of commitment to customers. All with an unbeatable combination of savings and security for customers.

And the potential for success for you.

Learn more, contact me.

Leo Plese (630) 328-7076 lmplese@autoclubgroup.aaa.com Insurance • Membership • Travel • Banking AAA Independent Agents are not employees of AAA The Auto Club Group; but, rather are independent contractors. Insurance underwritten by one of the following companies: Auto Club Insurance Association, MemberSelect Insurance Company, Auto Club Group Insurance Company, Auto Club Property-Casualty Insurance Company, Auto Club South Insurance Company, Auto Club Insurance Company of Florida, or non-affiliated insurance companies. ©2019 The Auto Club Group.

All rights reserved. 19-IN-0147

18

| AUGUST 2020 |

wisconsin INDEPENDENT AGENT

VIRTUAL UNIVERSITY

Illinois DOI ‘Requests’ Insurers Not Apply Policy Provisions Company Bulletin 2020-15 issued June 8, 2020, by the Illinois Department of Insurance (IDOI) threw key provisions of the business income policy out the proverbial window. In its bulletin, the IDOI addressed the recent riots and how the department expects insurance carriers to respond.

In a press release accompanying the bulletin, the IDOI and Governor’s office stated: “Damage to businesses follows dramatic declines in revenue for businesses across the state as a result of COVID-19 pandemic. As the state works with businesses to recover, the governor’s office and IDOI have made expectations clear to insurance companies.”

To clarify the IDOI’s expectations, the bulletin states, in part: The Department hereby requests that all insurers licensed or authorized to transact insurance business in this State immediately implement the following protective measures: • To the extent business interruption provisions are included and operative under a policy, insurers should base payouts on business activity levels that eliminate the impact of COVID-19.

Note the highlighted phrase. The IDOI is directing the insurance carriers to pay losses they do not owe. Why do the carriers NOT owe the loss when coverage is written using Insurance Services Office (ISO) or similar language? Because both business income policies, CP 00 30 10 12 - Business Income Coverage Form-With Extra Expense and CP 00 32 10 12 - Business Income Coverage Form-Without Extra Expense, apply the same methodology for determining business income loss payments, specifically both policies state: 3. Loss Determination a. The amount of Business Income loss will be determined based on: (1) The Net Income of the business before the direct physical loss or damage occurred; (2) The likely Net Income of the business if no physical loss or damage had occurred, but not including any Net Income that would likely have been earned as a result of an increase in the volume of business due to favorable business

conditions caused by the impact of the Covered Cause of Loss on customers or on other businesses; (3) The operating expenses, including payroll expenses, necessary to resume “operations” with the same quality of service that existed just before the direct physical loss or damage; and (4) Other relevant sources of information, including: (a) Your financial records and accounting procedures; (b) Bills, invoices and other vouchers; and (c) Deeds, liens or contracts.

Paragraph 3.a.(2) in both ISO’s business income policies state that the loss is partly determined based on the LIKELY Net Income. If the business was considered “non-essential” and was thus closed in an attempt to control the spread of COVID-19, the likely Net Income is zero. No dollars were being earned.

IDOI is strongly suggesting (maybe requiring) insurance carriers to ignore this and similar policy language. Carriers appear to be expected to pay business income claims resulting from riots and looting as if the business was fully operational.

The Independent Insurance Agents and Brokers of America (Big I) addressed the issue of covered losses occurring during the period of shut down as a result of COVID-19 in late March.

As was specified in this article, the only business income loss any carrier should owe is the amount of income lost AFTER the business COULD have opened but was not able to because of the property damage.

Any carrier paying claims not supported by policy language is doing so in violation of the principle of indemnification, the cornerstone of property insurance. Paying losses unsupported by policy language puts the insured in a better position than they would have been had these losses not occurred. This is a slippery slope carriers need to stay off.

> Chris Boggs Big “I” Virtual University Executive Director wisconsin INDEPENDENT AGENT

| AUGUST 2020 | 19

GOVERNMENT AFFAIRS

Workers’ Compensation and Liability for COVID-19 While IIAW member agencies continue to try and answer questions and provide as much helpful information to their customers on various issues related to the Coronavirus pandemic, a recent publication from the Wisconsin Legislative Council comes to mind as a resource. The Legislative Council is a nonpartisan service agency that provides legal advice and guidance to members of the Wisconsin Legislature so that legislators can make better, more informed decisions.

The Legislative Council published a June 2020 issue brief discussing Workers’ Compensation and employer liability for employees diagnosed with COVID-19 following returning to work. The issue brief explains that the state Workers’ Compensation Act provides that employee injuries sustained from an illness or infection are generally covered by Workers’ Compensation, but employees must demonstrate that they became ill through the course of their employment. Employees seeking Workers’ Compensation coverage for a COVID-19 diagnosis must show their illness was caused by exposure at work. Injuries, including COVID-19, are covered whether or not the employer was negligent.

Wisconsin Workers’ Compensation law provides an “exclusive remedy” for employees who are injured in the course of their employment, meaning that employees cannot bring separate legal actions outside of the Workers’ Compensation system against their employer for an employment-related injury. However, as the issue brief outlines, employees can still bring actions against third parties other than their employer, if the third party is at least partially responsible for their injury.

Employees must prove that the third party’s

negligence led to their injury, which also could include COVID-19 exposure.

Read the Legislative Council issue brief at https://bit.ly/AugGovAffairs.

The widespread COVID-19 pandemic leaves employers and third parties, even those following federal and state government recommended best practices and guidelines, open to lawsuits if employees or customers contract the virus. Various polling data suggests that employer liability is real with many employees indicating they would sue their employer over contracting COVID-19. This uncertainty and increased exposure to liability and costly lawsuits is of great concern to many employers throughout the state. Wisconsin needs a “safe harbor” for businesses that comply with government recommendations and practice appropriate protocols. These measures will help ensure business owners and their employees are comfortable reopening and protect employers from civil claims filed outside of the Workers’ Compensation system. Wisconsin lawmakers need to take action otherwise it will be “open season” on employers and a wave of COVID-19 related lawsuits from trial lawyers will seriously undermine efforts to restart and rebuild our state’s economy.

The IIAW supports efforts by the Wisconsin Civil Justice Council (WCJC), Wisconsin Insurance Alliance (WIA) and other business partners who are advocating for COVID-19 liability protections to protect our commercial customers.

>M isha Lee IIAW Lobbyist

wisconsin wisconsin INDEPENDENTAGENT AGENT INDEPENDENT

AUGUST2020 2020 | | 21 21 | | AUGUST

VIRTUAL UNIVERSITY

DOES REQUIRING CUSTOMERS TO WEAR MASKS HAVE ANY EFFECT ON LEGAL LIABILITY? States are in various stages of reopening following months of COVID-19 lock downs. As the states progress through the phases, businesses are making key decisions regarding masks, should masks be required or optional? Some legislatures have taken the responsibility for this decision away from business owners and are requiring masks be worn; but other states leave the decision to the business owners.

In states where the decision rests with the business, some operations have made the corporate decision to require masks be worn by all who enter the premises. From a legal liability perspective, is this necessary?

Legal Liability Legal liability is liability imposed by the court or regulators on the person or entity legally responsible for injury or damage suffered by another party. Such legal obligations (or liability) can arise from intentional acts, unintentional acts, contracts (express or implied) or regulations. Legal liability generally focuses on civil wrongs but can include criminal wrongs. “Legal liability” exists when: • The wrongdoer is found guilty of “Negligent Conduct” (breached the duty owed); • The injured party suffers actual damages; and • The wrongdoer’s “negligent conduct” is the proximate cause of the injury or damage.

A key requirement towards proving “negligent conduct” and ultimately legal liability is proving that the supposed tortfeasor (the wrongdoer) has or owed the injured party a specific duty of care and breached or failed to satisfy that duty. The degree of care owed to an injured party is based on the relationship between the wrongdoer and the injured party.

The greater the degree of care required or expected, the lower the threshold for breaching a duty owed (it is easier to breach a duty when greater care is required). Courts generally recognize four degrees of care or “levels” based on relationships are: • Slight Negligence: A high degree of care is required; • Ordinary Negligence: Requires “reasonable” care such as would be provided by a reasonable and prudent person; • Gross Negligence: Very little care beyond slight care (not to be confused with slight negligence) is required. This is represented by a deliberate or reckless disregard of a duty to exercise care which is likely to cause foreseeable and significant harm; and • Negligence per se: A breach of duty because the law says it is.

Negligence per se requires: 1) the at-fault party to violate the law, 2) the law to pertain to public safety, 3) the violation of the law be the cause of the injury, and 4) the injured person be a 22

| AUGUST 2020 |

wisconsin INDEPENDENT AGENT

part of the class of persons the law was designed to protect.

In a business/customer relationship, the business generally owes the customer a duty of reasonable care. While there are certain business relationships that increase the duty owed (such as that owed by an operation transporting passengers in a vehicle), reasonable care is the most common duty owed. For sake of this review, assume the business owes a duty of reasonable care.

Examples of duties owed by business establishments under the concept of reasonable care include repairing/correcting known hazards; warning against intrinsic/unrepairable hazards; and taking steps to avoid preventable hazards.

Consider the example of a restaurant that has several sets of steps in the path to the dining area, where a member of the wait staff has spilled some water and where the plate comes out of the oven very hot. Reasonable care in such a restaurant might include actions such as the person showing the customer to a table warns of the steps (“watch your step”), the wait person puts up a little yellow sign warning of the wet floor, and the person delivering the food says, “Be careful, the plate is hot.” These are examples of reasonable care.

Let’s return to the question of masks and legal liability associated with requiring or not requiring them. For this discussion, the injured party moves from a restaurant (it’s hard to eat while wearing a mask) to a retail location.

From the perspective of reasonable care, are masks necessary to avoid legal liability?

(Note, this discussion does not and will not address the availability or applicability of liability insurance coverage. Only the concept of legal liability regarding customers in a typical retail setting is addressed in this article.)

Effectiveness of Masks Before exploring the relative differences in legal liability between requiring masks and allowing customers the option, the purpose and effectiveness of masks must be considered. Discussions focused on the effectiveness of masks may be more complicated than the concept of legal liability because of the emotions and the lack of clear information surrounding the wearing of masks.

Purpose: The Centers for Disease Control (CDC) and the World Health Organization (WHO) both state there are essentially two “grades” or levels of masks: 1) those that filter out the virus designed to protect the wearer from contracting the virus and prevent the wearer from spreading the virus; and 2) those intended to prevent the wearer from spreading the virus, but that do not necessarily prevent

the wearer from contracting the virus. The masks most often worn by the public are the second type – masks intended only to prevent the spread and not the contracting of the virus.

Effectiveness: Unfortunately, the question of effectiveness seems to be unanswerable. Some claim the masks are very effective (giving percentages of protection without credible source substantiation) and some say they are little more than a “feel good” measure using drywall dust and even smoke to prove the point. Even the CDC and WHO are inconsistent in their messages. In regard to legal liability, effectiveness is largely irrelevant.

Masks Optional Business operations choosing to allow the customers to make the mask-wearing decision may subject themselves to accusations by a customer that he or she contracted the virus from an unmasked person or persons in the store. The injured person may assert that close contact with an unmasked person or persons led to their sickness.

Such charges may be impossible to prove. A virus is a humankind exposure and is not limited to a location where people are not wearing masks. If the claimant visited the grocery store, bank, pharmacy, office and/or other places during any particular day, proving the only place where they were exposed to the virus was the grocery store would be of utmost difficulty. Add to this the reality that other members of the family may have been several places, contracted the virus, and brought it home to everyone else in the house. Lastly, the masks worn in public are not designed to keep the virus from getting in, they are designed to limit the expulsion of the virus from the nose and mouth.

Frankly, lacking a law to the contrary, the business owner does not owe the customer a duty beyond reasonable care. Reasonable care is limited to the premises and what the business can actually control; viruses exist in more places than just the business premises and a business cannot be expected to protect a customer from exposure in all aspects of a customer’s life. Narrowing the person’s exposure down to one business on one particular day is truly picking gnats out of pepper.

Additionally, the legal concept of assumption of risk may be an affirmative defense to the mask-optional discussion. Assumption of risk is a legal doctrine under which an individual is barred from recovering damages for an injury sustained when he or she voluntarily exposed him or herself to a known danger. Put another way, assumption of risk prohibits the injured party from seeking damages on the basis that the plaintiff (injured person) knew of a hazardous or potentially hazardous condition and willingly exposed him or herself to it.

Assumption of risk defenses require the defendant to show: • The injured party had actual knowledge of the risk involved (conspicuously post signs warning “Enter at your own risk, masks are optional”); and • The plaintiff voluntarily accepted the risk (they entered the store).

When a customer visits a business where masks are optional, they make a conscious decision to enter the premises or not. If the injured party assumed the risk by entering the premises, the law generally recognizes the defendant no longer owes a duty to protect the plaintiff against that risk.

Given the relatively unclear requirements of reasonable care, the difficulty in proving the virus was contracted at a particular place on a particular day, the doctrine of assumption of risk, and the limited purposes of the masks, business owners are unlikely to be held legally liable solely because masks were not required of all customers.

Requiring masks may exceed the requirement of reasonable care. In fact, certain disabilities and ADA laws may make it impossible for all customers to wear a mask. If courts made mask wearing the minimum standard of reasonable care, removing the freedom of personal choice generally granted to the business owner and the customer/citizen, in a sense, the court would “legislate” masks by making mask wearing the minimum standard of care while ignoring the protection of assumption of risk. Some states have already undertaken legislative efforts to protect business owners.

Masks Required Previous paragraphs addressed the types and relative effectiveness of masks. Does requiring all customers to wear a mask decrease the business owner’s potential for being held legally liable?

Health officials recommend (where not a requirement) masks be worn that prevent the spread of droplets and mists from the nose and mouth that may contain the virus. Again, these masks aren’t necessarily designed to prevent the wearer from contracting the virus, but when every customer wears masks, the theory is everyone has a reduced (though not completely eliminated) chance of contracting the virus.

On the surface, requiring everyone to wear a mask appears to lower the chances that the business will be accused of contributing to or causing a person to contract the virus. Requiring a mask seems to be a physical manifestation of an exculpatory statement such as, “Not Responsible for Broken Windshields” or “Enter at Your Own Risk, Not Responsible for Injury.” The statement doesn’t make it so.

Individuals may be less likely to sue but requiring masks may not lower or heighten an operation’s legal liability for injury to a customer – if it can be proven the virus was contracted at the location.

What other steps were taken to protect the customer?

Legal liability is a function of duty and facts. Requiring masks of all customers may be above and beyond the duty of reasonable care owed to customers.

To Mask or Not Mask Requiring masks or allowing customers to make a personal choice apparently has no effect on the business owners’ ultimate legal liability. What is the duty owed (reasonable care)? Did the owner meet the duty owed? If both questions are answered “yes,” the business is not legally liable for any injury suffered.

Can the infected person prove the virus was contracted at the business? Given the facts of a virus and particularly this virus (with its long incubation period), proving it was contracted in any one place on any given day is nearly impossible.

Holding a business legally liable without other clear and convincing evidence simply because customers were not required to wear masks forces the court to set a standard of care almost impossible to maintain in the future. Every flu season or the event of another community sickness will subject business owners to a higher degree of care than ever required in history or should be considered reasonable.

A virus is a natural organism that man can avoid only so long. Holding a business owner legally liable is unreasonable given the facts of care and the reality of a virus.

Requiring masks may dissuade some from naming the business in the suit; but not requiring masks likely does not increase the overall chances of being held legally liable. > Chris Boggs

Big “I” Virtual University Executive Director

> Chris Boggs Big “I” Virtual University Executive Director wisconsin INDEPENDENT AGENT

| AUGUST 2020 | 23

AmGUARD • EastGUARD • NorGUARD • WestGUARD

We’re here to help Agents, during this uncertain time, let us help you write new and renewal business. As part of the Berkshire Hathaway group, we’re financially strong and ready to help.

WE OFFER: Payment flexibility Responsive claims handling Quality customer service

Commercial & Personal Lines • Apply to be an agent: www.guard.com/apply/

ERRORS & OMISSIONS

FROM THE EMAIL BAG: IF YOU’RE A BABYSITTER, LET’S HOPE YOU DON’T GET PAID LIKE ONE. I recently received a question from a Swiss Re Corporate Solutions/Westport Insurance Corporation policy holder: “Are there any real-world claim examples of agents being held liable when they establish a habit of contacting clients when a Notice of Cancellation (NOC) is issued on a direct bill policy; but then they forget and the policy gets cancelled, and the client has a claim, aka babysitting.

Such claims have been happening for at least the 27 years I have been with the firm although we have advised agencies not do so. I can safely say that this subject comes up at virtually every E&O risk management course I have ever taught or attended, and I regularly saw this type of claim when I was in the claims department. Just to be current, I contacted our claims department team leaders and within 5 minutes Jim Redeker found two recent examples where we paid substantial losses. Both were carrier direct bill policies.

Jim’s initial response was this: “Every time a policy cancels for nonpayment of premium and there is a loss, the argument is made that the agent should have done something. In most cases we simply state that the customer received the same notices that our insured received, and our insured has no duty to notify its customer of an impending policy cancellation. We have trouble when the agent failed to notify the customer that the policy was about to be cancelled for nonpayment of premium after the agent has made a practice of providing such notifications in the past. At that point the agency customer has an argument that they relied on our insured to notify them when their premium was due.”

In most cases the agent never had a legal duty to contact the customer, but because they had created an expectation that they would do so, the duty was now in place. And because of that, if they failed to do so they had breached their duty to the customer. If a loss occurred the agent could be held liable.

Example 1: “The customer alleged that on May 25 the agency mailed notice of policy expiration to the wrong address and unbeknownst to the customer the policy was

cancelled. The customer alleged that no one at the agency contacted them to advise the policy would be cancelled.

The Agency would mail cancellation notices to customer who would then pay. They would wait for the notice from the agency disregarding the notice mailed to them by the carrier. In this case, the agency mailed the cancellation notice to the wrong address, so the customer never paid the bill. There was then a claim made by the customer on the cancelled policy that was denied by the carrier. $101,242 loss paid by Swiss Re Corporate Solutions/ Westport on behalf of the insured.”

Example 2: “Mr. (Customer) is claiming that the agency developed a practice and procedure of personally collecting premium payments from Mr. (Customer) but failed to do so in this instance. The agency had a change in staff and was not aware of the previous practice, so the payment was not collected from the customer. The policy cancelled and there was a loss. The carrier denied coverage as the policy had rightfully been cancelled due to non-payment of premium. We paid a total of $204,837 on a death claim for a cancelled auto policy.”

These are just two of many examples where an agency developed a duty that they would not otherwise have resulting in substantial claim against the agency. The lesson for you as young agents (and not so young gents as well,) is simple: on direct bill policies where a Notice of Cancellation has been sent to the customer, DO NOT babysit your customers to make sure they pay the bill on time. HOWEVER, you should contact them immediately after the date of cancellation to see if they want you to try to obtain a new policy.

As a member of the IIABA, you have access to the “Virtual University” and if you are also a Swiss Re Corporate Solutions policy holder, you also have access to the “E&O Happens” website.

> Richard F. Lund, JD

President, Americas Property and Casualty, SwissRE wisconsin INDEPENDENT AGENT

| AUGUST 2020 | 25

News Members in the

ENCOVA INSURANCE APPOINTS MIKE KELLER TO BOARD OF DIRECTORS

Columbus, OH (6/12/20) — Encova Insurance has announced the appointment of Mike Keller to their board of directors, effective Aug. 18, 2020. Mike brings decades of executive leadership, technology and insurance expertise to their board based on his experience at Nationwide, Bank One and IBM. “Mike’s experience is unparalleled. He brings expertise and insight gleaned from leading high performing IT departments at three premier companies that will add to the strength of our board,” Board of Directors Executive Chairman Greg Burton said. “We are incredibly fortunate to welcome him to the company’s board of directors.”

“Having led the IT department of a well-respected national insurance carrier before his recent retirement, Mike’s vision, strategic guidance and wisdom of integrating multiple systems will be invaluable as Encova continues its focus on technology and the resulting customer experience being created for our independent agency partners and policyholders,” Encova President and CEO TJ Obrokta Jr. said.

“I am very excited to be joining the board of directors,” Mike Keller said. “Encova is a highly successful mutual insurance company with a talented board and leadership team, a deep commitment to their agents and policyholders, a focus on leveraging leading edge technologies, and strong midwestern values.”

About Encova Insurance A super-regional carrier ranked in the top 20 mutual insurance companies in the United States, Encova includes more than 1,200 associates writing in the 28 states and the District of Columbia, premiums in excess of $1 billion, a surplus in excess of $1.6 billion and assets in excess of $4.1 billion. The group markets insurance solutions through more than 2,000 independent agencies in the Midwest, Northeast and South.

ANNOUNCEMENT OF NEW PRESIDENT AND CHIEF EXECUTIVE OFFICER FOR AMERICAN RISK MANAGEMENT RESOURCES NETWORK, LLC HOLDING AND BROKERAGE DIVISION Middleton, WI (7/7/20) — American Risk Management Resources Network, LLC (ARMR.Network) Brokerage division is pleased to announce Kari Dybdahl Kohal as the organization’s next president. Kari Dybdahl Kohal 26

| AUGUST 2020 |

wisconsin INDEPENDENT AGENT

brings to the position a wealth of knowledge and an array of experience in business and environmental insurance industry, on a provincial, national, and global level. She has worked at ARMR.Network Brokerage for 13 years. She has taken on many responsibilities from clerical, to being their top broker, and more recently has been their Executive Vice President and Director of Operations for the past 4 years.

Kari Dybdahl Kohal sees a tremendous amount of opportunity and a bright future in the environmental insurance brokerage space. ARMR Network Brokerage division will continue to be the thought innovator in the research and development of specialty environmental insurance solutions. Her vision has been to empower their client partners to challenge the way specialty insurance is purchased.

She states, “as president our work to provide intimate customer service, high-quality advice, high-level negotiations, and engineered environmental insurance solutions never ends. We will continue to push the status quo, to create new programs, and incorporate more services to increase efficiency for our partners and for ARMR Brokerage.”

Kari Dybdahl Kohal is succeeding David Dybdahl who has served as founder and president of ARMR Brokerage Division since 2000. Kari joined the ARMR.Network Brokerage division in 2007. She has been instrumental in its growth and adaption to the market place. David Dybdahl, will become CEO of ARMR Specialty Holdings and continue to serve as President of ARMR Expert Services and their Managing General Agency (SREU) as well as continue work closely with Kari Kohal and the senior management team.

David Dybdahl, says he is pleased to have Kari Dybdahl Kohal as the next President of the ARMR.Network Brokerage Division. “Kari’s background, industry knowledge, accolades, coupled with her outstanding interpersonal, visionary, and communications skills, will ensure American Risk Management Resources Brokerage Division remains the globally recognized leader and trusted environmental insurance brokerage firm positioned to take on new opportunities”.

About American Risk Management Resources Network, LLC ARMR Specialty Holdings is a specialty wholesale environmental insurance brokerage firm and Managing General Agency. ARMR Specialty Holdings is uniquely designed as an Environmental Risk Resource Group on a wholesale insurance brokerage platform and are specialists in environmental risk management including insurance. We enable our broker/agent production partners to compete effectively with the largest and most expensive in-house environmental resource groups in the insurance brokerage community.

ARMR Brokerage offers exceptional expertise and experience in environmental insurance and risk management. Our well-qualified insurance brokers in their long careers have placed insurance on some of the most complex risks in the world, including developing the first Contractors Pollution Liability insurance policy in the world, insuring the containment operations from the nuclear disaster at Chernobyl, and developing the first insurance wrap-ups for Superfund remediation contractors.

As risk and insurance consultants, ARMR Expert Services

have been engaged by the US EPA, the US Army Corps of Engineers, and the US Justice Department. We are the major contributors to the chapters in the CPCU, ARM and IRMI texts on environmental insurance and we were also major contributors to the professional liability loss prevention chapter on environmental and mold risk professional liability loss prevention manual for the Independent Insurance Agents and Brokers of America.

No matter how routine or complex the risk, from a single underground storage tank to a merger and acquisition involving significant environmental legacy costs, ARMR Specialty Holdings has the experience and knowledge to help solve any environmental risk management challenge on a global basis.

We welcome the opportunity to discuss how we can best serve your agency and your clients.

Contact Information: www.armr.net | 877-735-0800 | Marketing@armr.net

BERKSHIRE HATHAWAY GUARD NOW OFFERING HOMEOWNERS COVERAGE IN MISSOURI, WASHINGTON AND WISCONSIN Berkshire Hathaway GUARD Insurance Companies recently announced it added Missouri, Washington, and Wisconsin to the list of states where the insurer offers its Homeowners product.

“Our goal is to become a ‘One Stop Shop’ for our agents and their insureds,” said Sy Foguel, Berkshire Hathaway GUARD CEO, “We continue to expand our portfolio to supply our network of independent agents with quality products that enable them to grow. With these three states, we now offer our Personal Lines products in 15 states with plans for further expansion in the months ahead.”

Senior VP of Personal Lines Dovid Tkatch explains that “We are very pleased with the results we’ve already experienced in our previous states, and we fully expect to see that trend continue. Our success can be attributed to Berkshire Hathaway GUARD providing a quality, easily understood product along with a high level of service to both agents and policyholders.”

GUARD’s product targets dwellings valued over $75,000 and includes one- to four-family residences, renters, and condo units (both owner-occupied and those held for rental). Tkatch explains, “By mixing and matching policy forms, endorsements, and optional coverages aimed at broader protection, policyholders can obtain property insurance suited to their circumstances. A Personal Umbrella with limits up to $5,000,000 is also available.”

According to GUARD’s spokesperson and Assistant Vice President of Marketing Elizabeth Hartman, “We believe we can provide a great service to agents that write both commercial and personal accounts. We feature a competitively priced product with a variety of available discounts, including one for insureds who have commercial policies with GUARD. We also believe certain aspects of our underwriting appetite are unique and will appeal to producers anxious to cross-sell and achieve a greater client share.”

Berkshire Hathaway GUARD Insurance Companies is a

property and casualty insurance specialist writing $2 billion in premium nationwide. GUARD offers a variety of products for both commercial and personal lines of insurance.

Headed by CEO and President Sy Foguel, the Berkshire Hathaway GUARD Insurance Companies maintain a total of eight offices throughout the country. To learn more about Berkshire Hathaway GUARD visit http:/www.guard.com.

Agents interested in applying should visit https://www. guard.com/apply/.

ACUITY NAMED A TOP PERFORMER BY WARD GROUP FOR 21ST STRAIGHT YEAR

Acuity has been named to the 2020 Ward’s 50 list of topperforming property-casualty companies, putting the company in the top 2 percent of insurers nationwide. Acuity has earned a spot on the Ward’s 50 every year since 2000, making the company one of only four insurers, and the only regional carrier, to be named to the list for 21 consecutive years. Ward Group is the leading provider of benchmarking and best practices studies for insurance companies.

“We recognize Acuity for outstanding financial results in the areas of safety, consistency, and performance over a five-year period,” said Jeff Rieder, partner and head of Ward Group. “In selecting the Ward’s 50, we analyze the financial performance of nearly 2,900 property-casualty insurance companies, identifying the 50 companies that pass financial stability requirements and demonstrate the ability to grow while maintaining strong capital positions and underwriting results.”

“Strength, stability, and consistency in an insurance company have never been more important than today,” said Ben Salzmann, Acuity President and CEO. “We are honored to be recognized by Ward Group for 21 consecutive years as a top performer, which demonstrates our ability to fulfill our promises to customers and grow our business.”

Acuity continues to outperform the industry. Over the past 21 years, the insurer’s rate of sales and surplus growth have been more than double the industry average. Acuity’s combined ratio, nearly 4 points better than the industry average in 2019, has been under 100 for nine consecutive years.

Acuity Insurance, headquartered in Sheboygan, Wisconsin, insures over 100,000 businesses, including 300,000 commercial vehicles, and nearly a half million homes and private passenger autos across 28 states. Rated A+ by A.M. Best and S&P, Acuity employs over 1,400 people.

News Members in the

wisconsin INDEPENDENT AGENT

| AUGUST 2020 | 27

Š 2020 Society Insurance

No waiting period.

Small detail. Big difference.

Some insurance companies say your power has to be out for at least 72 hours before they’ll reimburse you for loss of business. Not Society Insurance. Our coverage kicks in immediately, because we both know you start losing money the second you lose power. See the difference?

To discuss an agency appointment, give us a call at 888-5-SOCIETY or visit societyinsurance.com.

COMMENTARY FROM COUNSEL

SCOTUS EXPANDS EXCEPTION TO EMPLOYMENT CLAIMS AGAINST RELIGIOUS INSTITUTIONS In the final days of its 2019-20 term, the Supreme Court issued a decision with potentially vast implications for religious organizations. In Our Lady of Guadalupe School v. Morrisey-Berru, the Court ruled that parochial school teachers do not, for the most part, enjoy protections under federal employment laws. This decision, and the potential for the Court to expand on it in the years to come, could have a major impact on insured claims against religious institution employers.

The Our Lady of Guadalupe School Case and Decision The Our Lady case is actually a combination of two employment discrimination cases brought by Catholic school teachers in the Los Angeles area. In both cases, the teachers argued the schools terminated them for discriminatory reasons. The first plaintiff, Agnes Morrisey-Berru, claimed her former employer fired her based on her age. The second plaintiff, Kristen Biel, argued her former school terminated her because she had breast cancer.

Before delving into the Court’s opinion in Our Lady, however, it is necessary to discuss a bit of background.

In 2012, the Supreme Court considered a similar case in which a terminated parochial school teacher sued her former employer for discrimination under the Americans with Disabilities Act. In that case, the Court recognized a “ministerial exception” to federal employment laws rooted in the First Amendment’s protection of the free exercise of religion. Specifically, the Court dismissed the plaintiff’s suit, holding that the ministerial exception precluded her claim given that she had received extensive religious training, was considered a minister of her church, and her firing fell into a category of decisions religious institutions make that are essential to their central mission.

Despite important differences between the two cases, the Court reached the same decision in Our Lady as it did in 2012. In the 2012 case, the Court ruled the ministerial exception barred the teacher’s ADA claims based on evidence that the fired teacher had extensive religious training and was considered by her church to be a “minister.” The same could not be said for the Our Lady plaintiffs, as the two teacher plaintiffs in the case did not have any specific religious education credentials, and one of them testified that she was not even a practicing Catholic. However, according to the Court’s majority opinion, whether a teacher has religious training is inconsequential to the ministerial exception analysis. What mattered in Our Lady was that the teachers taught religious

curriculum, prayed with their students, and accompanied them to mass. Ultimately, in dismissing the teachers’ claims, the Court held that the schools had initially made the determination that the teachers knew enough about Catholicism to teach the subject, and “judges have no warrant to second-guess that judgment.”

Now What?

Despite the fact that both the Our Lady decision and the 2012 case involved teachers, the rulings could have much broader implications. In her dissent, Justice Sotomayor criticized the majority, arguing it had destroyed the existing standard of review for the ministerial exception and replaced it with a single consideration: “whether a church thinks its employees play an important religious role.” Not only could this “strip[] thousands of schoolteachers of their legal protection,” according to Sotomayor, it could also extend to “countless coaches, camp counselors, nurses, social-service workers, in-house lawyers, media-relations personnel, and many others who work for religious institutions.”

If you or your agency have religious institution clients, this decision, and its progeny, could have a considerable impact on the scope of potential employment-related claims and litigation. If lower courts consistently (or even more broadly) apply the holding from Our Lady, it could greatly reduce the amount (or at least the success) of employment discrimination claims against religious institutions.

Moreover, if Justice Sotomayor’s dissent proves prescient, the opinion could serve as the backbone for future decisions dismissing discrimination claims brought by any employee of a religious organization, or even claims brought by parishioners involved in community outreach or charity work.

Conclusion In Our Lady of Guadalupe School v. Morrisey-Berru, the Supreme Court expanded the ministerial exception to employment discrimination claims brought against religious institutions. While the case involved teachers at parochial schools, the decision may impact claims brought by any employees of religious organizations. Keep an eye on this column and updates from the IIAW for related developments.

>J osh Johanningmeier IIAW General Counsel wisconsin INDEPENDENT AGENT

| AUGUST 2020 | 29

Signed. Sealed. Delivered.

With tailored insurance packages from EMC, you can help ensure your client’s wholesale operation is properly insured every step of the way. We offer a full range of products, including coverage for delivery errors or omissions and employment practices liability.

And with our extensive loss control resources and expert claims knowledge, we make choosing the right insurance for your clients a whole lot easier.

www.emcins.com ŠCopyright Employers Mutual Casualty Company 2020. All rights reserved.

FOOD FOR THOUGHT

to Commercial Insurance that understands the Bar & Tavern Industry At Badger Mutual, we take commercial insurance personally. Visit our website today to learn more about a customized package of protection for your customers.

badgermutual.com wisconsin INDEPENDENT AGENT

| AUGUST 2020 | 31

PRSRT STD US POSTAGE PAID MADISON WI PERMIT NO. 549

WHAT THE HAIL JUST HAPPENED? NO WORRIES, CALL US. HOMEOWNERS INSURANCE THAT’S DESIGNED TO BE WORRY FREE A home is one of the most valuable assets. Whether it is a current homeowner, someone looking to own, or someone renting a home, financial protection is needed for the important things in life.

A homeowners policy from IMT Insurance can help your policyholders Be Worry Free.

Learn how you can represent IMT Insurance at imtins.com/contact.

W W W.II AW.CO M/IN SU RCO N

AUTO | HOME | BUSINESS