Wisconsin Independent Agent July 2019 Magazine

wisconsin INDEPENDENT AGENT JULY 2019

ADVOCATE BUILD INSPIRE

RENEW YOUR MEMBERSHIP TODAY!

Independent Insurance Agents of Wisconsin

We are pleased to recognize the critical role of our partner insurance agents and brokers in helping us achieve another remarkable year.

Thank you for your ongoing commitment to our company.

Berkshire Hathaway

GUARD

Insurance Companies

COMMERCIAL LINES | PERSONAL LINES See state availability at www.guard.com

wisconsin INDEPENDENT AGENT CONTENTS

Independent Insurance Agents of Wisconsin 725 John Nolen Drive Madison, Wisconsin 53713 Phone: (608) 256-4429 or (800) 362-7441 Fax: (608) 256-0170 www.iiaw.com

4.............. IIAW Membership Value Solutions 6.............. Insurance Bartender Membership in the Independent Insurance Agents of Wisconsin Has Never Been More Important 10-12.......InsurCon 19 13............Emerging Leaders Spotlight 15............ Risky Business Identify, Plan and Act With Your Partners at The IIAW 16............ Sales 4 Ways to Stand Out at Every Stage of the Sales Process

2018-2019 EXECUTIVE COMMITTEE President: Jason Bott Robertson-Ryan & Associates, Milwaukee President-Elect: Chris Costakis Avid Risk Solutions, Middleton Secretary-Treasurer: Darrel Zaleski Spectrum Insurance Group, Eau Claire

18, 19...... Commentary From Counsel Website Accessibility in a Time of Rising ADA Litigation 20, 21...... Virtual University What Is A “Change” In Risk?

22, 23...... Agency Operations Building Blocks of Agency Leadership 26, 27...... Government Affairs Republicans Send Governor Evers $81 Billion Amended Budget Plan 29............ Errors and Omissions Using Checklists for Fewer E&O Claims, Greater Sales 30, 31...... Virtual University Ask An Expert 33............Members In The News 34............Food For Thought

Chairwoman of the Board: Lise Meyer-Kobussen Meyer Insurance Agency, Inc. Sauk City

ADVERTISERS & INFORMATION

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 Emily Mydlowski Member Engagement Coordinator 608.210.2972 | emily@iiaw.com Ashley Hale Graphic Designer and Creative Marketing Manager 608.210.2977 | ashley@iiaw.com Evan Leitch Technology and Risk Advisor 608.210.2971 | evan@iiaw.com Diana Banaszynski Education Coordinator 608.256.4429 | diana@iiaw.com

State National Director: Steve Leitch Leitch Insurance, River Falls

2018-2019 BOARD OF DIRECTORS

Mike Ansay Ansay & Associates, Port Washington Nick Arnoldy Marshfield Insurance Agency, Inc., Marshfield Mike Harrison R&R Insurance Services, Inc., Waukesha Dan Lau Robertson Ryan & Associates, Inc., Milwaukee Aaron Marsh Marsh Insurance Services, Inc., Rice Lake Marc Petersen American Advantage - Petersen & Assoc., Inc., New Berlin

Joanne Lukas Szymaszek Johnson Insurance Services LLC, Racine Chad Tisonik HNI Risk Services LLC, New Berlin Pam Utpadel Universal Insurance Advisors, Inc., Appleton

IIAW STAFF

34...........AAA 9.............Acuity 17...........Arlington/Roe 19...........Badger Mutual 27...........Erickson & Larsen Inc. 7.............IIAW Agency Accounting 14...........IIAW Agency Solutions 25...........IIAW CE Education Calendar 8.............IIAW Graphic Design Services 31...........IMT 21...........JM Wilson 32...........Keystone 28...........Partners 24...........Prelicensing Schedule 13...........Robertson Ryan 36...........Secura 35...........West Bend 5.............Western National 2.............West GUARD 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. © 2019

On The Cover...

It’s that time of the year again, to renew your Independent Insurance Agents of Wisconsin membership! There are many new benefits we are offering this year to go along with the access to an exclusive network of more than a quarter million independent insurance professionals nationwide that receives advocacy, business solutions and technical expertise from the industry thought leaders with the Independent Insurance Agents of Wisconsin and the Big “I”.

For information on advertising, contact Ashley Hale, 608.210.2977 or ashley@iiaw.com. wisconsin INDEPENDENT AGENT

JULY 2019 3

OUR VALUE IS FINDING YOUR SOLUTION! You’ve made the choice to build your agency on independence, but that doesn’t mean you’re alone. Membership in the Independent Insurance Agents of Wisconsin and the Independent Insurance Agents & Brokers of America allows you access to an exclusive network of more than a quarter million independent insurance professionals nationwide that receives advocacy, business solutions and technical expertise from the industry’s thought leader.

As your agency seeks solutions to challenges and opportunities, turn to the IIAW. Our experience combined with our vast network of insurance professionals seeks to provide you with the optimal solutions. We do the work so you don’t have to!

ADVOCACY When independent agents need a voice on Capitol Hill and in the halls of the state capitol, legislators listen to the Big “I.” Our government affairs teams work around the clock in Washington D.C. and in Madison, WI to protect your clients and your livelihood.

Our expertise, combined with a million dollar Political Action Committee (PAC) and our grass roots network, provides us with the ammunition to protect your independence. We will fight for you on flood insurance, health care, taxes, insurance regulation, and more, while you run your agency.

INSPIRATION THROUGH EDUCATION The IIAW is inspiring new and exisitng insurance professionals to become the Agency of the Future.

Our Professional Development Program, educational course offerings, and industry-leading events are inspiring, educating and positioning our members to re-train their brains, re-tool their employees and re-shape their business to be responsive to today’s consumer. Harness your ability, unleash your potential and deliver solutions.

AGENCY SOLUTIONS Our agency solutions offer trusted consulting for the independent agent. Because we know how important it is for you to succeed in business, IIAW has created a portfolio of solutions built just for you.

TECHNOLOGY

STRATEGIC

We help you Protect your investment navigate and choose by reviewing business the best solutions to goals and strategies fit your needs

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wisconsin INDEPENDENT AGENT

OPERATIONAL

FINANCIAL

MARKETING

Update and improve agency workflows and operating procedures

Review financial processes for accuracy and efficiency

Review your agency marketing efforts and discover helpful tools and resources

INSURANCE BARTENDER

MEMBERSHIP IN THE INDEPENDENT INSURANCE AGENTS OF WISCONSIN HAS NEVER BEEN MORE IMPORTANT If you thought 2018 and the first half of 2019 was a transformative year for the Independent Insurance Agents of Wisconsin and the products and services we offer, just wait for the rest of 2019 and 2020. In 2019, we added three new staff members (Evan, Ashley, and Diana) to enhance our services and product offerings. We also launched a strategic partnership with one of the nation’s leading independent insurance agency technology companies.

I hope you had the chance to read June’s issue of the Wisconsin Independent Agent magazine. If not, be sure you do. That issue featured insurance technology company DAIS and the Internet of Insurance (IoI). In the article I mentioned how the Internet of Insurance offers cutting-edge technology to help independent agencies grow by adding new revenue streams, compete in a digital marketplace, supercharging workflows, communicate instantly, build and access powerful data assets, and save time and money all while increasing an insurance agency’s valuation. Best of all, this cutting-edge technology is available for FREE to IIAW members.

As I write this article, myself as well as IIAW Vice President Mallory Cornell and IIAW’s Risk and Technology Advisor Evan Leitch are undergoing training on the IoI. As we look to help our members get up and running on the platform, we will be able to help onboard interested agencies and answer any questions. We will begin pushing out information on how

Matt’s Mixology Strawberry Basil Bourbon Lemonade Servings: 8

Ingredients 8 oz. bourbon 2 c. strawberries 2 tbsp. sugar 1/2 c. fresh lemon juice 12 basil leaves 8 basil sprigs bitters

Steps to Make It Place strawberries into blender and add 2 tbsp of sugar.

Add about 1/4 of a cup of water and pulse until pureed. In a medium saucepan over a medium-high heat, add the puree and 1 3/4 cup of water. Heat until mixture begins to boil.

Allow to cool and then strain through a sieve.

In a large pitcher, combine the strawberry syrup, bourbon, 1 cup of water, lemon juice, basil leaves, and a splash of bitters.

Stir and then pour into eight glasses with ice. Garnish each with a basil sprig.

agencies can take advantage of this cutting-edge technology platform and get it up and running in your agency.

In addition to IIAW’s partnership with DAIS and the IoI, we launched several new assessments to help evaluate your agency and its needs. These assessments map directly to IIAW and IIABA products, tools and resources to help your agency adjust to take advantage of opportunities while addressing potential deficiencies. Read this month’s Risky Business column for additional information.

The IIAW also now offers limited agency accounting services and education. From day-to-day bookkeeping services to payroll processing to helping prepare annual budgets, the IIAW has the capacity to assist a few more agencies with their accounting needs. The IIAW has been assisting agencies with their accounting needs for the last year now and we have expanded to be able to add more agencies. Contact me directly for additional information.

Furthermore, the IIAW has launched a new service to assist members with their graphic design needs. Whether you are looking for help creating attractive flyers, digital and social media content, updating your logo, business cards, etc.

Ashley, IIAW’s Graphic Designer and Creative Content Marketing Manager, can assist you. Reach out to her to learn more.

Some may look at the Big I and see fresh faces, new products and services and a revamped website (coming in the next few months), but rest assured this organization is steeped in tradition and always has your best interest at hand. All these positive changes can be attributed to one thing, evolution.

We have fresh staff members with an expertise our organization has not previously employed or deployed. The IIAW is constantly reinventing its value proposition to ensure its responsive to the needs of our members. As the industry and the needs of the independent agent evolve, so do we. Ask any business owner, change can be difficult, but in difficulty lies opportunity.

The Association continues to evolve into offering consultative services to help its members address their most pressing needs.

No matter the challenge or opportunity facing your agency, engage with us. The IIAW is committed to advocating for the independent agency channel, helping you build your business and inspire you to become the agency of the future. We will do whatever it takes to help your agency prosper. One Association.

Thousands of Resources. Renew your membership today.

Yes, its that time of the year again. Thank you for your continued support.

> Matt Banaszynski CEO of IIAW

AGENCY ACCOUNTING

IIAW can help your agency with your accounting needs.

Here are some services we offer:

Agency Accounting Services: • • • • • •

Provide Day-to-Day Bookkeeping Payroll Processing Direct and Agency Bill Reconciliations Financial Statement Preparation and Interpretation Prepare Annual Budget Plan Work with Your External Accountants for Tax and Auditing Needs

Agency Accounting Best Practices and Education: • Provide Education and Training on Agency Accounting Terminology • Review Agency Accounting Practices and Workflows • Recommend and Implement Financial Best Practices

MATT BANASYNSKI IIAW CEO

608-256-4429 matt@iiaw.com

KIM KRAMP

IIAW Association and Agency Accounting Manager

608-256-4429 kim@iiaw.com wisconsin INDEPENDENT AGENT

JULY 2019

7

PERSONALIZED GRAPHIC DESIGN SERVICES FOR YOUR AGENCY

ASHLEY HALE

IIAW Graphic Designer & Creative Marketing Manager

608-210-2977 ashley@iiaw.com

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JULY 2019

wisconsin INDEPENDENT AGENT

SERVICES: • Business Papers (business cards, letterhead, envelope) • Flyers • Brochures • Digital Ads • Social Media Graphics • Print Ads • Banners • Logos • Custom Projects

PRICES: To receive a customized quote for your individual graphic design needs, please send a project description email to Ashley@iiaw.com

Acuity loves you!

We are proud of the relationships we have built with the best independent agents in the world!

www.acuity.com

120th

Anniversary Year This year was the 120th anniversary year for IIAW’s annual convention.

Keynote Jim Abbot Left and above

John Maketa right:

DAIS Presentation

CEO Panel Left to right: Dina Schultz - SVP & COO Society Insurance Sean Kennedy - President & CEO IMT Insurance Jill Wagner Kelly - President Integrity Mutual Insurance Company Matt Banaszynski - CEO IIAW

Wrap Up Party - Charlie Berens

Anniversary Awards 125 Years

100 Years

Far Left: West Bend: Kevin Steiner presented by Matt Banaszynski Left: West Bend: Kevin Steiner Right: Madison Mutual: Michael H Wenos presented by Jason Bott

IIAW Award Winners

President Jason Bott President’s Award

Linda Covey Mary Morrison Customer Service Representative Award

Ryan Leitch Emerging Leader of the Year Award

Jenna Zalud Industry Representative of the Year Award

Kash Motlani Industry Representative of the Year Award

Tom Sitter Employee Benefit Agent/ Broker of the Year Award

Marc Petersen Noble Eagle Award

Dan Lau Raymond “Skip” Hansen Agent of the Year Award, Noble Eagle Award

Not pictured: Noble Eagle Award: Pam Uptadel; Government Affairs Leader of the Year Award: Nick Arnoldy wisconsin INDEPENDENT AGENT

JULY 2019 11

CE Sessions

Members Meeting

Exhibit Hall

JOIN a Top 100 Agency

How we grew from 28 Producers to 95 Producers.

Q: What markets do you have?

A. As the largest independent agency in Wisconsin, RRA has strong carrier relationships. We offer over 50 CL, 30 PL and 45 EB carrier partners.

Q: Will I make more money?

A. Yes, we offer one of the strongest returns to Producers. We pay all office costs including staff salaries. You continue to own your business/book but enjoy all the advantages of being with a larger agency, including profit sharing.

Q: How can I maximize my time?

A. We handle staff management, HR, accounting, IT, rating, office management and other administrative details. This allows Producers to spend more time with their families or growing their book on their terms.

Q: How does carrier contingency work?

A. Producers can share in ALL contingencies. Because of our size, our contingent return is more predictable and stable to our Producers.

Q: Do you have a solid perpetuation plan?

A. Scaling back hours, retiring or planning for the unexpected should be a priority. We help connect Producers with similar interests and backgrounds to develop a buy/sell plan where they are comfortable.

Q: What technology resources do you offer?

A. A dedicated IT department ensures technology resources are performing and the latest tools are being reviewed. We operate on Applied Epic and offer Zywave, AcuComp and HR Workplace Services.

Q: Who owns the book?

A. Simple, the Producer maintains 100% ownership without a non-compete.

Learn More: Chris Illman I cillman@robertsonryan.com I 800.258.0277 I www.RobertsonRyan.com

EMERGING LEADERS SPOTLIGHT Tell us your name and a little more about you: Jonathon Zwettler from Madison, WI. I am the Business Development Manager from Baer Insurance.

How long have you been on the Emerging Leaders Committee?

I’ve been a member of the Emerging Leaders Committee for 4 years.

How did you hear about the EL Committee?

I was encouraged to join the Emerging Leaders Committee by one of my co-workers.

Each month we will be featuring one of the active members of our Emerging Leaders Committee.

Our July Emerging Leader is Jonathon Zwettler from Baer Insurance in Madison, WI.

Why did you choose to become active with the Emerging Leaders committee?

I thought the committee would be a good way to get more involved in the insurance industry and to network with the other members of the IIAW. What is your favorite EL event or activity that you’ve done with the EL group?

The PriSim event was probably my favorite event that I have done with the Emerging Leaders group. It was a great workshop to learn about both sides of our industry-the agency and the carrier. We got to see in real time how different

decisions can have a dramatic effect on the performance of an agency and a carrier.

Why should a new agent join the EL committee?

The EL committee is a fun and committed group that truly wants to improve their individual companies, the insurance industry, and themselves. Being able to get perspectives from people at other agencies has helped me grow a lot in this profession and I think it is a great learning opportunity for any new agent.

What is your spirit animal?

I could go a lot of different directions with this one. As my 3 year old nephew has an obsession with dragons right now, I’ll go with that.

Where is your favorite vacation spot?

Anywhere warm with a pool bar.

Do you have any pets?

We have 2 rescue dogs. Loki is 5 and Puddy is 3 What is one professional goal for you in the next 3-5 years?

I’d really like to get one of those office beds built that George Constanza had.

AGENCY SOLUTIONS

TRUSTED CONSULTING FOR THE INDEPENDENT AGENT Because we know how important it is for you to succeed in business, IIAW has created a portfolio of solutions built just for you.

TECHNOLOGY

STRATEGIC

OPERATIONAL

FINANCIAL

MARKETING

We help you navigate and choose the best solutions to fit your needs

Protect your investment by reviewing business goals and strategies

Update and improve agency workflows and operating procedures

Review financial processes for accuracy and efficiency

Review your agency marketing efforts and discover helpful tools and resources

YOUR FIRST CALL

We are a trusted partner for independent agents across the nation and a leader in agency risk management and agency solution

Mallory Cornell, IIAW Vice President mallory@iiaw.com www.iiaw.com

RISKY BUSINESS

IDENTIFY, PLAN AND ACT WITH YOUR PARTNERS AT THE IIAW

Running a business is more time-intensive than its ever been and much of that is due to the additional risks, exposures and opportunities in the industry today. Is your data adequately protected? Do you have a realistic five-year plan to grow your agency? When was the last time your website was update or reviewed? Effective agency risk management doesn’t have to crowd your calendar…or be tackled alone.

for your agency; we just give you the process to make it easier and more efficient.

FRESH NEW LOOK

If you haven’t heard yet, the team at IIAW has some exciting news. We’ve been analyzing data from internal questionnaires, inquiries and industry news to build assessments with customized resource guides for our valued members. The program is built on five areas an agent should be considering for their business: technology, strategy, marketing, finance and operations.

These pillars are filled with opportunities and resources to make improvements to an agency – think of it like your own personal risk management roadmap.

The team at IIAW is committed to continually improving your membership experience. We know you don’t expect the same services year after year and we will not let you down! As we worked hard to build out the portfolio of resources that aligned to the new assessments, we also discovered a need to enhance how these resources are showcased. The currently ‘home’ for the extensive list of tools is found by going to www.iiaw.com/agencysolutions. In the next few weeks, you will see a complete overhaul of our IIAW website and we couldn’t be more excited. We promise the same great content, but with a more organized and updated look.

TAKE THE FIRST STEP

YOU ARE IMPORTANT

Its quick and easy. Oh, and did we mention its all FREE? That’s right. The IIAW wants to make sure you’re getting the most out of your membership. Start with the Quick Agency Assessment to find out exactly which pillar you should begin with. For example, you may have a low score in the area of Marketing. Select the Marketing Assessment and learn about some of your options for IIAW resources that can help you make necessary improvements to your business. Did you know the IIAW has a Graphic Designer on staff that you can utilize?

The customized Action Plan will map your responses to resources and a checklist to help you determine where you would like to focus. You make the final decisions

Every single one of our IIAW members is important to us and we want you to easily recognize the value in your IIAW membership. We have updated our own internal workflows to do a better job of connecting with you and ensuring you are aware of all an IIAW membership has to offer. You are always welcome to call our office with any questions you may have. We would love to hear from you!

> Mallory Cornell,

IIAW Vice President and Director of Risk Management wisconsin INDEPENDENT AGENT

JULY 2019 15

SALES

4 WAYS TO STAND OUT AT EVERY STAGE OF THE SALES PROCESS “Personalization” is a major buzzword in insurance sales. But it’s also a very misunderstood term.

For many independent agents, personalization means putting the client or prospect’s name on the front slide of a presentation deck. But more and more research shows this isn’t enough.

An overwhelming 90% of U.S. consumers find personalization appealing, according to Statista. But 92% of consumers are unlikely to engage with marketing that simply addresses them by name, according to a Pure360 survey. So how can independent agents personalize the sales experience in a way that actually engages people?

When you’re selling a product on a recurring basis, there are opportunities at every stage of the sales cycle—from pre-sale through renewal:

Make a human connection with new prospects. Personalizing your pitch can

go both ways. You can personalize it to what you know of your prospect, but you can also make it personal to you.

Make your introduction memorable by sharing a real story about yourself in one of these areas: • What is your background?

• How did you get into selling insurance?

• Why do you represent the plans and companies in your portfolio?

• What are your values?

If you’ve got a few years under your belt, you could also take this personal approach a step further and share your expert insights. Show them you’re an industry expert before getting into the weeds of your pitch. This is especially effective in B2B sales but can work equally well when selling directly to consumers:

Time your follow-up perfectly.

Thanks to modern technology, you now have tools at your disposal that can tell you the exact right moment to follow up with a prospect.

Whatever content management system you use to send your sales materials, make sure it has built-in tracking and notifications features. That way, you’ll know the exact moment your customer opens your message. If the tracking features are robust enough, you’ll also know exactly how much they read of what you sent them. Then, you can send your followup moments after they read your materials.

Be a hometown hero at renewal time. When a client’s contract is up for renewal, this

is the perfect time to draw on the personal story you initially shared with them. This will help remind your client of the personal connection they feel with you.

Our sales team calls this the “hometown hero moment” in the sales process. It’s also a great moment to send a small, personal gesture of appreciation. If your hometown is known for a prized candy or baked good, a unique craft beverage or a gourmet seasoning, send it as a small gift to reinforce to your client that they’re more than just a sale to you.

Bonus: You’ll also have something more than policy details to kick off contract renewal discussions.

Use your manners. This should go without

saying, but sadly, it can’t. Use good manners, and be kind and genuine when dealing with prospects and clients at every stage of the sales cycle.

Unfortunately, we’re often told that kindness makes us look weak or subordinate. But simple gestures like showing up on time, following up when you say you will, or sending a thankyou message—especially a handwritten card—can really make you stand out from the pack.

• What do you believe will be different in your industry in 5-10 years?

• What technological innovations do you see coming, and how will they affect your customer?

> Millie Blackwell,

Founder & President of Showcase Workshop

16 JULY 2019

wisconsin INDEPENDENT AGENT

You’re in the business of protecting others.

So, who’s watching out for you?

We are. At Arlington/Roe, we put the needs of our customers first. What does that look like? Well, it looks like experience you can trust, integrity you can count on, promises we stand behind and an independent and family-owned industry partner who understands your specific needs. Located in nine states and licensed in all 50, we’ve got your back.

Get to know the people of Arlington/Roe. We’ve been doing the right thing since 1964.

Let us help you find the right solutions.

Managing General Agents | Wholesale Insurance Brokers

800.878.9891 | ArlingtonRoe.com

Aviation | Bonds | Brokerage | Commercial Lines | Healthcare & Human Services | Farm Personal Lines | Professional Liability | Transportation | Workers’ Compensation

COMMENTARY FROM COUNSEL

Website Accessibility in a Time of Rising ADA Litigation Title III of the Americans with Disabilities Act (“ADA”), 42 U.S.C. § 12182, applies to private businesses with more than 15 employees and prohibits “discrimination on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation.”

When President George H.W. Bush signed the ADA into law in 1990, the internet revolution was a decade away, and the concern was ensuring physical access to traditional “public accommodations”: wheel chair ramps in movie theatres and elevators in department stores, for example.

The explosion of internet activity—especially online shopping—has come a parallel explosion in a particular type of Title III ADA litigation: claims that blind or visually impaired consumers are not able to access a company’s website, or certain parts thereof. The number of these claims, known as “website compliance” claims, is rising meteorically—there were 5,000 brought in the first six months of 2018. Because of their potential impact on Wisconsin businesses—including independent insurance agencies and their clients—it is worth understanding the context and risks of these “website compliance” claims.

Website Accessibility Issues Individuals that are blind or significantly visually impaired often purchase software that allows them to effectively navigate the internet. These are collectively referred to as “commonly used assistive technology.” The most common example is a screen reader, which is a software program that allows users to read the text displayed on a computer screen with a speech synthesizer or braille display.

A screen reader cannot, however, interact with every website to perform its functions. Rather, the website itself must have specific characteristics that allow “commonly used assistive technology” to work. For example, a common complaint is that a website lacks “alternative text,” which is an invisible code embedded beneath a graphical image that allows screen-reading software to describe the graphic. If the website does not have this technology, the assistive device cannot describe the graphic to the visually impaired user.

A cottage industry has developed where plaintiff’s attorneys— often aligned with “professional plaintiffs”, who file hundreds or even thousands of cases—seek out websites that do not have the requisite coding to interact with assistive technology and make demands and/or file lawsuits against them. Often, it is a putative class action suit, with the attorneys seeking a quick pay-out.

What is the State of the Law? There is no doubt that blindness or significant visual 18 JULY 2019

wisconsin INDEPENDENT AGENT

impairment is a “disability” under the ADA. But courts around the country are grappling with two other questions, both of which have murky answers: are websites a “public accommodation” under the ADA such that it even applies; and, if so, what is required for compliance.

Websites as Public Accommodations Title III of the ADA only applies to “public accommodations,” which are statutorily defined as certain “entities” affecting commerce. These “entities” include hotels, theatres, restaurants, retailers, and grocery stores, amongst many more. It also specifically includes insurance offices. But does the definition of “public accommodation” include websites maintained by these entities?

Courts have been forced to answer this question without any help from the other two branches of government (discussed more below). Perhaps predictably, they are divided into camps: those that require a website to have a corresponding physical space to be a “public accommodation,” and those that do not.

The federal Third, Sixth, Ninth, and Eleventh Circuit Courts of Appeals have taken the more restrictive view: places of public accommodation must be physical places. However, goods and services provided by a public accommodation (which may include through websites) may fall within the ADA if they have a sufficient next to a physical location. For example, a federal court in Florida found Winn Dixie’s website to be a “public accommodation” because it was “heavily integrated with . . . physical store locations and operates as a gateway to the physical store locations.”

Conversely, the First, Second, and—pertinently—Seventh Circuits have determined that a website can be a place of public accommodation independent of any connection to a physical space. According to this jurisprudence, “[t]he site of the sale is irrelevant . . . . What matters is that the good or service be offered to the public.” Wisconsin is located within the Seventh Federal Circuit, and is therefore beholden to its decisions interpreting federal law. Accordingly, in Wisconsin, a private business’s website need not have a physical presence to be considered a “public accommodation” under the ADA. Compliance with ADA Requirements Wisconsin businesses employing more than 15 employees therefore must comply with ADA requirements for their websites, i.e. maintain a website that allows sufficient access for blind or visually impaired persons. That brings up the second question—what does compliance look like? Once again, the courts have been left to answer this question alone.

Many courts, however, have determined that compliance with the Web Content Accessibility Guidelines (“WCAG”), Version

2.0, satisfies the requirements of the ADA. In a September 25, 2018 letter sent by Assistant Attorney General Stephen Boyd , the DOJ implied that while compliance with WCAG 2.0 was not necessary for ADA compliance, it was sufficient.

The WCAG 2.0 guidelines are complex, and a comprehensive outline of them is beyond the scope of this article. For more information, we would encourage you to visit the WCAG’s Success Criteria, available at https://www.w3.org/WAI/ standards-guidelines/wcag/. Very broadly, though, WCAG 2.0 outlines four principles for accessible website design: • Perceivable, meaning visually impaired users can perceive the information being presented; • Operable, meaning visually impaired users can operate the interface; • Understandable, meaning visually impaired users can understand the information as well as the operation of the user interface; and • Robust, meaning visually impaired users must be able to access the content as technologies advance.

As the above four principles indicate, compliance with WCAG 2.0 is demanding and requires periodic updates. In addition, WCAG 2.0 works on an “all-or-nothing” basis—that is, if half of the pages on a website are in conformance, the website is not 50% in conformance; rather, WCAG 2.0 requires the entire site to be in conformance, or none of it passes.

This is a bit surprising, as circuit splits (different federal appeals courts interpreting the same law different ways), especially of major laws, are usually prime for Supreme Court review. However, the circuits have been split for several years now, so the Supreme Court has had the opportunity to clarify—it has simply declined.

This perhaps indicates that it feels the DOJ or Congress are more suited to provide the clarity that everyone is seeking.

Conclusion Website compliance ADA litigation has been exponentially increasing, and it does not appear to be going away anytime soon. Because “insurance office” is explicitly listed as a “public accommodation” under the ADA and the Seventh Circuit has liberally applied the ADA when it comes to websites, individual insurance agency websites will likely need to comply with ADA accessibility requirements. As always, we will provide a further update if (and when) there are future developments on this increasingly significant field of law.

> Josh Johanningmeier IIAW General Counsel

Keep in mind, again, that WCAG 2.0 is not the law, and there may be other strategies to mitigate the risk of website accessibility claims as well as to defend them when they arise.

What is Being Done, and What Does the Future Hold?

Since 2003, the DOJ has ostensibly been addressing this issue, but to no avail. In 2010, it began drafting formal regulations to tackle the issue. The DOJ had not promulgated those regulations as of December 2017, when it announced it was withdrawing its rulemaking process in conformance with the Trump administration’s mandate to rollback federal regulations. This prompted the above-cited bi-partisan letter from the House to the Attorney General’s Office.

Assistant AG Boyd’s response to the letter did not address the “public accommodation” issue at all, and only vaguely helped with respect to compliance. In early 2019, the Credit Union National Association (“CUNA”) wrote newly appointed Attorney General Barr again requesting clarification, but has thus far heard nothing back.

For many years Congress also did nothing. Finally, spurred by negative media coverage and the onslaught of litigation, the House passed the ADA Education Reform Act of 2017 in February 2018. The purpose of the ADA Reform Act was to decrease litigation by mandating a pre-filing notification and waiting period. However, it never passed the Senate, where 43 senators (filibuster proof) pledged in writing to block a vote.

Finally, the Supreme Court has provided absolutely no indication that it wants to get involved and provide clarity.

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

VIRTUAL UNIVERSITY

WHAT IS A “CHANGE” IN RISK? Recently the VU has received a number of questions around the topic of mid-term cancellations. Evidently carriers are beginning to threaten this more and more; and more and more the carriers seem to think they can make this call simply because there is something they don’t like about the insured.

Insurance is designed to provide a source of financing when something bad occurs; but to be considered “insurable,” the possibility of that bad thing occurring must be very low. When the “risk” of uncertainty is initially underwritten, the insurance carrier is basing its decision on “statistical uncertainty” meaning they don’t know what will happen, but they can estimate the chances based on the characteristics of the insured. When those characteristics change, the uncertainty changes which means the “risk” changes. These changes could lower the risk or increase the risk; I doubt the carrier is bothered by a lower risk, so the easy assumption is the statutes relate to an increase in uncertainty (increase in risk).

Unfortunately for the carriers, it’s not this easy or simple.

Unfortunately for the agents, the statutory requirements allowing mid-term cancellation are just fuzzy enough to make fighting these claims and actions difficult.

Let’s try to clarify the application of these mid-term cancellation statutes.

In June 2017, the VU published a state-by-state spreadsheet detailing state laws regarding mid-term policy cancellations.

Many states allow mid-term cancellation only in certain circumstances. Regulations use different phrasing such as: • • • • • •

• • • •

A substantial change in risk assumed….

A change…that results in material added risk, a materially increased risk, or a materially changed risk….

A substantial change in the exposure or risk….

A material increase in the hazard insured…. …a change in the risk which substantially increases any hazard insured against….

Change in the risk which materially increases the risk of loss after insurance coverage has been issued or renewed including, but not limited to, an increase in exposure to regulation, legislation or court decision.

The risk originally accepted has measurably increased.

There is a substantial change in the scale of risk….

Changes…which have materially increased the hazards….

The risk originally accepted has substantially increased.

•

Substantial: Although somewhat self-explanatory, “substantial” means large, major, significant, great…. When “substantial” is used, it portrays something that significantly alters the nature of the risk.

•

Material: This term carries with it many of the same attributes as “substantial.” A “material” change is one that wholly alters the outlook. In underwriting, a fact is considered material if: 1) the underwriter would have made a different underwriting decision; 2) the underwriter would have charged a different premium; or 3) the underwriter would have applied different terms and conditions. A material change in risk (uncertainty) follows the same logic.

•

Increased: The likelihood of an adverse outcome is greater than originally planned because the operations or characteristics of the insured change significantly.

•

Hazard: A “hazard” is something that increases the likelihood of a loss occurring. There is always the “risk” that a fire could occur at a building; but if you store 300 gallons of flammable and combustible liquids in that building, you increase the likelihood of fire damage. The flammable and combustible liquids are the “hazard” that increases the “risk.”

•

Exposure: Depending on which side of the fence you are on, “exposure” has a couple of meanings. From the audit side, this means the payroll, sales or whatever is used to price the insurance. When the insured’s payroll increases, the exposure basis increases. Although this is not the intended meaning in these statutes, this application of the term does directly relate to how the term “exposure” applies in these statutes. Essentially, “exposure” relates to the factors that could cause a loss. Taken alone, this term is indeterminant in regard to mid-term cancellations.

•

Measurable: Although we know what “measurable” means, this term is rather non-specific on its own. How measurable does the change have to be to allow for mid-term cancellation?

•

Change: It isn’t what it used to be; there has been a “change.” What the insured did before is not what is done now. The underwriting factors aren’t what they were or what the carrier was told. Something is different. But again, this term cannot be used without a qualifier. Insureds are forever

Although this is not a listing of every state’s “change in risk” wording, this list adequately represents the variations found.

(Note: One state (and only one) allows mid-term cancellation when/if there is an increase in exposure resulting from new regulation, legislation or court decision. It seems highly inappropriate to allow a carrier to drop a risk just because of a court decision. Idaho should reconsider such a position.)

When considering these statutes, when is mid-term cancellation allowed? Several key words must be understood to properly answer this question. Note that the following explanations include any variations of the term: •

Risk: Within insurance this term is used in one of two ways. First, underwriters and agents often use this term interchangeably with the “insured.” The underwriter says, “Tell me about the risk.” What they are saying is, tell me about the insured and what they do. This is not how the term should be understood or applied in relation to these midterm cancellation statutes. “Risk” in these statutes is given its traditional meaning – uncertainty regarding future event.

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wisconsin INDEPENDENT AGENT

“changing” to some extent, the right to cancel mid-term cannot be allowed simply because of a “change.”

With these terms defined, review the statutes once again.

Note that each statute requires a substantial or material change in the operational or condition of the risk initially insured. Basically, a carrier can issue mid-term cancellation only when the operations have changed significantly, or the conditions are materially changed.

For example, a material change in operations might include a deli that begins to serve mixed drinks in the evening to increase profits. A significant change in conditions might include a restaurant that originally occupied a noncombustible building, but due to renovations and additions, the building is now classed as a frame building. A combination change might be a steel fabricator that begins working with magnesium (a combustible metal when grinding and shaving).

Ultimately, mid-term cancellations aren’t allowed just because the underwriter doesn’t like something the insured is doing or where they are operating. There must be a major change in operations or conditions before a mid-term cancellation is allowable. Basically, the insured isn’t what they used to be.

One example of a misuse of such statutes came from an agent. The agent’s email stated, “This morning, an underwriter

told me he can cancel the policy of one of my contractors because they are going to do work in ‘downstate’ New York, and his company doesn’t want to insure work in that area.” While this may be a carrier underwriting guideline, this is not a material change in operations. They wrote a contractor that did “X,” and they are still doing “X,” they are just doing it in an area the company may not like. They do have the option to non-renew, but no statue says anything about allowing mid-term cancellation when a risk falls outside of underwriting guidelines.

If the insured did “X” when the policy was written, but now does “X” and “Y,” or changed completely to “Y” (with “Y” being a material or substantial change in operations), then the carrier has the statutory right to cancel mid-term. It’s about what the insured does.

Don’t let carriers bully you or the client with the threat. The carrier has the responsibility to prove the substantial or material increase or change in the risk insured. If it appears they overstep the bounds of the statute, recommend a joint call with the department of insurance, you may be surprised by the results.

>C hris Boggs

Big “I” Virtual University Executive Director

PROFESSIONAL LIABILITY BROKERAGE PROPERTY & CASUALTY GARAGE LIABILITY TRANSPORTATION SURETY PERSONAL LINES

(800) 666-5692 | JMWILSON.COM

AGENCY OPERATIONS

BUILDING BLOCKS OF AGENCY LEADERSHIP KNOW WHERE YOU WANT TO GO AND HOW YOU’RE GOING TO GET THERE For the last 30 years, international leadership guru John Maxwell, who was my mentor and with whom I’ve had the privilege of sharing a stage, has said that everything rises and falls on leadership. Although I used to question that idea, my experience has convinced me that it’s true! Leadership affects every area of our personal and professional lives.

To me, leadership is not a destination, a title, an expensive car or a corner office. Although all of those things may be the result of great leadership, they are not one and the same. Leadership is an action, and the way you measure that action is influence. Are people listening to you? Are they buying in to what you’re trying to accomplish? Are you building relationships?

Ultimately I believe three main building blocks form the foundation of great agency leadership: • • •

Clarity of vision and direction Confidence in your entire team Culture with buy-in and accountability

Clarity

As business leader and author Keith Cunningham has said, “Running the wrong way enthusiastically is stupid.” Not only do I agree, but I see this in many agencies today.

Many agency leaders have good intentions and work extremely hard to get ahead, but their actions are like those of a hamster on a wheel.

They’re running faster and faster, but they don’t know if they’re going in the right direction or if they’re going anywhere at all. In reality, the only place they’re going is nowhere fast! To gain clarity, they must ask—and answer—the following questions: Where are we today? All progress starts by telling the truth, so let’s not sugarcoat it. Make a brutally honest assessment of where your agency stands today, be it good, bad or indifferent. Know your agency numbers. Without them, you can’t know the status of your business.

Where do we want to go? As an agency leader, you are the navigator.

It’s up to you to steer your agency in the right direction. But first it’s critical that you determine where you want to go. What is your desired destination? What do you really want, and what is your vision for the agency?

How will we get there? Once you have determined where you are and where you want to be, you must develop strategies to get you there. For example, let’s say you own a $1 million revenue agency and I ask you where you want to be in three years. The typical response is, “In three years, I want to be a $5 million agency.” Great!

How will you do that? “We’re going to make more sales.” Okay—how?

“We’re going to sell more.” To me, that sounds more like wishful thinking than an actual plan of action.

Hope is not a strategy! You can’t just hope that things are going to magically improve. You must have a plan and a way to implement it.

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wisconsin INDEPENDENT AGENT

Otherwise you’ll never reach your goals.

To get your team on the same page, your business plan should be on one page. It helps to enhance clarity. I think a lot of agency leaders have a lot of abstract ideas, hopes and dreams, many of them quite good. To clearly convey their message to the team, however, they’d be well advised to distill it into a single page that addresses the following key points: Vision and mission. While the one-page business plan should be simple and straightforward, it also should clearly define the agency’s mission (its business and objectives, and its approach to reach those objectives) and describe its vision (where the agency would like to be in the future). I’m not talking about an inspirational message on the wall that people tend to ignore. It must come from the heart and define your agency’s objectives. It should not be an empty statement such as, “Our mission is to serve our customers well.” That’s fine, but doesn’t that go without saying?

I believe that when leadership comes from the heart—and not the mouth—it comes with conviction. A true leader inspires others to believe in the mission and help realize the vision.

Critical Success Factors. What do we have to do consistently (e.g., daily/weekly/always) to become successful? What are those things we consider non-optional behaviors? What are the strategies we truly believe in?

Key Performance Indicators. What are the metrics we’ll use?

We can’t just guess that we’re making progress; we have to be able to measure it. Revenue, for example, is an obvious indicator.

What is our operating profit? What is our organic growth rate?

At Sitkins, we use GROFIT (your agency’s Organic Growth Percentage plus Operating Profit Percentage). We believe agencies should strive for a minimum of 40%. For example, if you have a 25% operating profit and 15% growth, you’re at 40%. You’re doing really well! It’s a matter of understanding where you are today and building on it.

Other key indicators we look at include revenue per relationship, closing rate and retention rate. Every agency has its own indicators, but these are some of the main ones we look at.

At the bottom of our one-page business plan, we have The One Thing, which is meant to clarify your intentions and provide continuity to your team. This is the single thing you will be laser-focused on and do exceedingly well.

Confidence

Confidence is a key building block, which according to Robert Kiyosaki comes from discipline and training. Unfortunately, most agencies don’t have a team development plan. Although every agency is unique, the highest performing ones all have something in common: They all provide coaching and training.

In fact, this is the case at almost every business in any industry. It takes confidence to reach the top, whether in athletics, music or insurance. And the best way to develop it is through training, coaching and discipline.

Many people mistakenly believe that the #1 responsibility of a sales leader is to increase sales when it’s actually to improve the people on the sales team. Similarly, the #1 responsibility of an agency leader is to develop people, whether it’s producers, service team members or sales managers.

Culture

If you’re an agency leader, you understand that your employees are your most important asset. When they know that you want to invest in them, train them, mentor them and believe in them, their confidence grows. In turn, their confidence in the agency begets confidence that extends to your clients and the entire community. Your agency’s numbers are simply a reflection of the behaviors and strategies you have in place.

We know from working with agencies and their owners that the best processes will not save a poor culture. You can have all the tools and technology in the world, but if people don’t buy into it or if the culture’s not strong enough to support it, you’re wasting your time. It’s not going to work. So what should you do if you’re an agency leader who wants to change your company’s culture?

What does good training look like? If you aren’t doing it, you probably haven’t made it a priority or you’re not sure how to do it. Here’s what I believe should be the three focal points of an agency’s team training: 1. Prepare. Of course you have to write business and make sales, but first and foremost, you must prepare.

When we look at high-performing, high-growth agencies, we find that their producers are simply better prepared than their competitors. Preparation is their #1 competitive advantage. For instance, they prepare their production team to ask better questions. They prepare their production team to tell their story of differentiation. They also prepare their producers to build overflowing pipelines with the future ideal clients they’ve identified. All of these are skills that must be defined and developed.

One of the best ways to prepare is through role playing.

Doing so ensures that when producers show up to play, they’re ready! It’s no different than what any other professional does to prepare for a public performance: practice, practice, practice! Can you imagine a professional sports team that never practices between competitions but shows up on game day expecting to win? Or try to envision being a musician in a symphony orchestra that never rehearses for concerts. Instead you’re given only a score sheet and a date to perform. Neither scenario will have a good outcome. Similarly, a sales organization that doesn’t appropriately prepare its team should not expect great results.

2. Play. Now that you’re prepared to give your best performance, how will you execute it? What’s the plan?

What play are we running? If everyone has a different approach to playing, the game will not end well. What is your agency’s way of doing business? Do you have a true sales process? How do your sales and service teams collaborate? All of that (and much more) must be defined. Otherwise you’re just hoping that somehow the pieces will fall into place when it’s game time.

3. Stay. At the end of the day, your job as an agency leader is to do such a great job that you keep clients for life. That’s what the best agencies do. Remember, you don’t want to renew accounts, you want to continue relationships. And there’s a significant difference in both the process and the mindset.

Even in today’s technology-driven world, this will always be a relationship business. Your tool of the trade is insurance and risk management, but what you do is still all about building relationships with clients who can’t imagine doing business with anyone else. How are you coaching and training your sales team to cultivate lifelong relationships?

What is culture? Basically, it’s the attitude, language and behaviors that are normal in your agency. That’s it! How do people talk?

How do they react to one another? How do people communicate internally and with clients? Do employees dread Mondays and celebrate Fridays?

First you may want to reconsider your use of the word “change” because the idea of behaving differently tends to make people feel anxious. At the same time, it’s not entirely true that people don’t like to change. For instance, if I offered you a million dollars, I bet you’d have no problem changing immediately!

People don’t resist change, they resist being changed. That’s why we suggest that agency leaders focus instead on improvement.

The word “improve” has a lot more power and appeal than “change.”

Frequently, leaders who want to make fundamental changes or improvements in their agency start by implementing a sales process, a continuation or renewal process, and new metrics.

While those things are important, any meaningful improvements must start with culture. To do that, you must continually communicate what the agency is all about. What is its mission?

What is the vision? Incidentally, when you begin to think you’ve over-communicated about the culture, your message is probably just starting to sink in. You really can’t say it enough. Keep in mind, you are the heart of the agency! It’s up to you to continually pump blood into the organization.

Accountability is another key component of culture. A culture without accountability is a culture of chaos. Conversely, a culture of accountability is a collaborative effort that results in a win-win.

It’s the shared vision of two parties who have agreed on what they want and what each will do to help the other succeed. The greatest producers want to be held accountable to perform at higher levels than they ever thought possible.

Discipline and accountability go hand in hand. Discipline is not about punishment, however; it’s about performance. As Jim Collins, author of Good to Great, puts it, “A culture of discipline is not a culture of business, it’s a culture of greatness.” It’s true.

At the best agencies we work with, everyone—producers and leaders alike—buys into being accountable. Because of that, they produce the greatest results.

Ultimately it’s about living a life of abundance versus a life of scarcity.

John Maxwell was right when he said, “Everything rises and falls on leadership.” As a leader, that may seem like a huge challenge.

However, when you become clear on your vision and direction, develop confidence in your team, and build a winning culture, this challenge becomes your greatest opportunity.

What is the best version of your agency? Are you committed to making it happen? It starts with you.

>B rent Kelly

Vice President of Sitkins Group, Inc.

wisconsin INDEPENDENT AGENT

JULY 2019 23

2019 Prelicensing Class Schedule Conducted at State Association Headquarters, IIAW prelicensing classes fulfill the study requirements for life, health, property and casualty. Full course materials are included with registration.

The classes are: • • • • •

Designed to help you pass your state licensing examination The quickest way to meet the WI education hours requirement Taught by experienced insurance professionals who know the business Conducted in a comfortable classroom with free parking Approved by the Office of the Commissioners of Insurance

REGISTER AT IIAW.COM To register, click the Education tab on IIAW.com.

For WI exam info, visit Prometric.com.

IIAW Member Pricing: $340 Pricing given for full class registration Non-Member Pricing $355 You may also take individual classes Contact Kim@iiaw.com for multi-registration discounts.

For any other questions please contact Diana@iiaw.com.

LIFE & ACCIDENT/HEALTH

PROPERTY & CASUALTY

January 7-10 February 4-7 March 4-7 April 1-4 May 6-9 June 3-6 July 8-11 August 5-8 September 9-12 October 7-10 November 4-7 December 2-5

January 14-17 February 11-14 March 18-21 April 15-18 May 20-23 June 17-20 July 15-18 August 19-22 September 16-19 October 21-24 November 18-21 December 9-12

The course fee includes all class materials. Materials are distributed on the first day of class. You receive: • Life & Accident/Health or Property & Casualty Insurance Study Manual • The Intermediary’s Guide to Wisconsin Insurance Law • The Stat of Wisconsin Ins. Licensing Candidate Handbook (This provides all the information to obtain a license)

DAILY SCHEDULE

Day 1 (Monday) 8:30 am - 4 pm ($85) Section A: Principles of Insurance & General WI Ins. Law Ethics Day 2 (Tuesday) 8:30 am - 4 pm ($90) Section B: Life Policies, Terms & Concepts or Section B: Property Policies, Terms & Concepts Day 3 (Wednesday) 8:30 am - 11:30 ($45) Section B: Life Policies, cont. & WI Life Insurance Law or Section B: Property Policies, cont. & WI Property Insurance Law Noon - 4 PM ($45) Section B: Accident & Health Policies, Terms & Concepts or Section B: Casualty Policies, Terms & Concepts Day 4 (Thursday) 8:30 am - 4 pm ($90) Section B: Accident & Health, cont. & WI Health Insurance Law or Section B: Casualty Policies, cont. & WI Casualty Insurance Law

CLASS SITE/DIRECTIONS

The IIAW is located at 725 John Nolen Dr. in Madison, WI. When traveling south on John Nolen, it’s the last driveway before Highway 12/18 (Beltline). Located near the Alliant Energy Center and Sheraton Hotel.

INCLEMENT WEATHER

If weather conditions are questionable, use your own judgment regarding your personal safety.. If Madison public schools are closed, the IIAW is closed and pre-licensing is canceled for the day. Canceled classes are made up on Friday.

HOTEL INFORMATION

Student requiring lodging will receive a special rate at the Clarion Suites, 2110 Rimrock Rd. in Madison. Please call the hotel directly at 608.284.1234, and ask for the “Independent Insurance Agent” discount.

CONTINUING

EDUCATION IIAW ONLINE EDUCATION & CE CLASSES DATE

COURSE

TIME

15 16 16 18 22 23 24 25 25 29 30 30

Commercial Property Coverages - Exploring Key Concepts E&O: Roadmap to Policy Analysis - Part One E&O: Roadmap to Policy Analysis - Part Two Ethics - Walking a Straight Line Businessowners Policy (BOP) ... Planning for the Unexpected Unlocking the Secrets of D&O Insurance Cyber Liability When the Child Becomes the Parent - Aging Parents and Insurance Decisions Top 10 Countdown of Personal Lines Coverages & Current Issues Workers’ Compensation Farm Vehicle and Equipment Coverages Homeowners Hot Topics ... What You Need to Know

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

Commercial General Liability Coverages E&O: Roadmap to Policy Analysis - Part One E&O: Roadmap to Policy Analysis - Part Two Insuring Hobby and Small Farms Contractual Liability...Separating Fact from Fiction Additional insureds and Certificates of Insurance Condominiums Fiduciary Liability, ERISA Bonding, and Employee Benefits Liability The Affordable Care Act contains significant responsibilities for benefit plan decision makers Farm Property Coverage Insuring Trusts - Protecting Your Client’s Wishes Who Is An Insured Ethics and the Law Life Insurance...Benefits for the Living

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

JULY

AUGUST

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12 PM - 3 PM 12 PM - 3 PM 12 PM - 3 PM 12 PM - 3 PM 12 PM - 3 PM

Hiring with IdealTraits - Webinar for BIG I - IIAW Monday, July 29th 2019 - 2:00 PM (CDT)

BIG I HIRES has partnered with IdealTraits to bring a recruitment solution-based platform for IIABA Members. IIAW has worked to offer you a great way to recruit in the modern environment.

As a top salesperson for 20+ years and 10 years building sales and service teams, John Hill will share with you how IdealTraits has revolutionized insurance agency recruiting and how you can get started hiring amazing staff with IdealTraits.

We will cover: Free Recruiting Tips for all agents to use History of IdealTraits and Partnership with IIABA Members The IdealTraits Hiring Process • Post Jobs Free: Post your job to sites like indeed.com, ZipRecruiter, Google for Jobs and 100+ more.

• Manage Candidates: Start receiving candidate resumes within one day. View profiles, comment, rate and organize through hiring stages.

• Pre-hire Assessments: Pre-screen candidates to predict job performance. Valid, secure, and EEOC compliant.

• Identify & Hire: Instant performance reports empower hiring managers to identify strengths and weaknesses beyond the typical resume.

TO REGISTER, PLEASE GO TO IIAW.COM

GOVERNMENT AFFAIRS

Republicans Send Governor Evers $81 Billion Amended Budget Plan Note: At the time of publication, Governor Evers will have formally acted on the budget.

Republicans in the Wisconsin Legislature recently approved an $81.7 billion two-year state budget bill (Assembly Bill 56) heavily on a party-line vote and have sent it to Democratic Governor Tony Evers for his review and final action. The Assembly approved the bill 60-39 following the addition of several amendments. Three Assembly Republicans joined all 36 Democrats in voting against it. Similarly, the Senate passed the measure the next day on 17-16 vote, with two Republicans joining all 14 Democrats in voting against the final package.

According to the nonpartisan Legislative Fiscal Bureau (LFB), by law, the Governor has until July 5th to formally act on the budget which starts the six-day countdown from when he receives the document.

Governor Evers received the budget from the Legislature on Friday, June 28th. Sundays are excluded from the countdown, but holidays are not. Evers has multiple options at his disposal to act on the budget including: 1. he can sign the budget, 2. he can allow it to become law without his formal signature, 3. he can use his powerful partial line-item veto authority to make changes to it, or 4. he can veto and outright reject the budget. Interestingly enough, no Wisconsin Governor since 1931 has vetoed an entire budget altogether.

If that were to happen, state spending levels would continue at the current rate until a new budget is enacted. If Evers takes no action by Friday, July 5th, the bill automatically becomes law. It’s more than likely that Evers will use his line-item veto to make changes to the budget prior to then signing it into law before the Fourth of July holiday.

The sausage-making involved in passing a budget is never pretty, especially when 26 JULY 2019

wisconsin INDEPENDENT AGENT

there is shared governance between the executive and legislative branches.

However, Republican leaders managed to pass a budget and maneuver a tricky dynamic not just with a Governor of the opposing party, but also in the state Senate where there are a handful of conservative-minded senators who feel that both the Evers’ and Republican budgets spend and borrow excessively too much. But the majority of Republicans understood that establishing a middle ground with Evers’ priorities was necessary in order to govern functionally.

The Republican budget passed by both houses includes significant increases for K-12 public education, transportation, health care and capital building projects. This budget’s total spending is 5.6 percent more than current spending levels, representing a larger increase than any of the state budgets approved by Governor Scott Walker. Those total spending increases range from 4.1 percent in the 2013-15 budget to 1.8 percent in the 2011-13 budget. The Republican budget sent to the Governor does not include several of Evers’ major priorities such as, state Medicaid expansion, a gas tax increase to finance road improvements statewide, and significant increases for K-12 public schools. Evers had originally proposed an overall 8.3 percent spending increase in his budget that was introduced back in February.

Below is a brief summary comparing major areas of Governor Evers’ proposed budget to the budget approved by Republicans in the legislature prior to any vetoes: Income tax cuts Evers: Cut income taxes 10 percent for lower- and middle-income residents by about $415 million a year, or about $225 per tax filer.

Funded the reductions by capping the manufacturing component of the

Manufacturing and Agriculture tax credit at the first $300,000 in annual income and limiting capital gains exclusions.

Boost the earned income and homestead tax credits.

GOP Legislature: Including the budget and separate legislation, Republicans would use online sales tax and the surplus to cut income taxes an average $136 in 2020, according to the Legislative Fiscal Bureau. The lowest income tax rate of 4 percent would drop to 3.89 percent in tax year 2019. It would then go to 3.76 percent in tax year 2020. The second lowest rate would drop from 5.84 percent to 5.08 percent in tax year 2019 and then 4.93 percent in tax year 2020.

The state’s top two brackets of 6.27 percent and 7.65 percent would remain the same.

Property taxes Evers: The median-valued home, worth $166,967 at the end of last year, saw a property tax bill of $2,871. Under Evers’ budget, that would go up $56 to $2,927 in the first year and $48 to $2,975 in the second. Those increases amount to 2 percent and 1.6 percent, respectively.

GOP Legislature: Provided another $6.2 million into the lottery credit to ensure the GOP budget would have a lower property tax bill for the median-valued home than under the version of the budget Evers proposed. The $6.2 million would result in lowering that bill by $1 in the first year and $4 in the second.

Public schools Evers: Proposed $1.4 billion for K-12 education, including a $606 million increase in special education aid.

GOP Legislature: Provided $500 million boost over the next two years and $97 million more for special education.

Roads Evers: Proposed increasing the gas tax by 8 cents a gallon. The gas tax increase would have climbed to nearly 10 cents

by the end of the two-year budget as a result of indexing, something that Evers proposed bringing back. Evers also sought to offset the impact of the gas tax hike by eliminating the minimum markup on gasoline at the pump. Evers also proposed a $10 boost in the vehicle transfer fee and $338.3 million more in bonding.

GOP Legislature: Rejects minimum markup elimination. Raises the vehicle transfer fee by $95 to $164.50, and boosts the annual auto registration fee by $10 to $85. The GOP plan also includes $326.3 million in bonding and a one-time $90 million general fund appropriation to help local governments pay for road projects. The move would come on top of the existing $87.8 million transfer from the general fund comprised of income, corporate and sales tax collections going to the Transportation Fund.

(ACA), resulting in $1.6 billion for a variety of health care programs.

GOP Legislature: Rejected expansion of Medicaid and would continue to direct some of the state’s working poor to the exchanges offered under Obamacare, while investing an additional $588.2 million in general purpose revenue into Medicaid to accomplish goals such as increasing reimbursement rates for health care providers.

UW System Evers: Fully fund the tuition freeze for resident undergraduates with $50.4 million in state aid, part of a total boost of $126.6 million.

GOP Legislature: Provides $69.7 million less in state aid than Evers, but approves

Medicaid Evers: Full federal expansion of Medicaid through the federal Affordable Care Act

more than $1 billion for UW-System capital building projects, slightly less than what Evers proposed.

Medical marijuana Evers: Decriminalized possession and legalized medical marijuana.

GOP Legislature: Deleted the provisions from the budget bill.

Overall spending Evers: $83.8 billion budget, which would amount to an 8.3 percent spending increase and a $2.5 billion capital budget.

GOP Legislature: $81.7 billion two-year budget that would increase state spending by 5.6 percent over the base, plus a $1.9 billion capital budget.

> Misha Lee IIAW Lobbyist

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Casualty | Excess | Pollution | Professional | Property | Transportation and much more wisconsin INDEPENDENT AGENT

JULY 2019 25

We help people feel secure and make life better when bad things happen

Partners Mutual Insurance is proud of the rich history we have enjoyed since our founding in 1931. So, when we affiliated with Penn National Insurance, a super regional carrier in 2012, we set out to accomplish even more.

Together we bring the personal attention and local focus of a regional carrier, along with the products and services of national carriers.

We want to partner with the best agents and are appointing select top-performing agencies in Wisconsin.

Interested in partnering with a thriving insurance carrier with superior customer experience?

Contact Mike Ottman at 262.432.3418; Ottman.Michael@PartnersMutual.com Or visit our website at partnersmutual.com

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Using Checklists for Fewer E&O Claims, Greater Sales In most states, the duty of a typical independent insurance agent or broker—one who has no “special relationship” with the client—is simply to use reasonable care in procuring the insurance coverage requested by the client, or if such coverage cannot be obtained, to advise the client promptly.

But your client may be unaware that certain coverages are not included in a standard policy and must be added by endorsement or a separate policy. State law may not require you to recommend those additional coverages, but it may make sense to at least offer them.

Does the commercial property client want basic, broad or special form coverage? Actual cash value or replacement cost?

Business income coverage? Does the general liability client have any additional insureds to include? Do they want employment practices coverage? Workers compensation? An umbrella?

Experienced agents or brokers ask these questions and more when working with new customers, but what if your employee forgets one or more of these topics? Do you and your employees ask each of these questions again at renewal, since client needs change over time? Importantly, do you document the discussion?

One proven way to ensure that available coverages and higher limits are always offered is to use a checklist. A good checklist includes coverage choices as well as optional coverages a client might want to accept or reject.

It also documents that the agent asked each of these questions and others, particularly when it includes a signature line at the bottom for the customer to confirm they have accepted and rejected the coverages as noted on the checklist.

When used consistently, agency checklists are a great loss prevention tool for both you and your client—and failing to use one as a routine part of procedures could be a problem when defending an errors & omissions claim.

Checklists probably do not create a higher duty than the general duty to procure the coverage requested, but failing to use the agency’s standard checklist allows for an argument that the agency failed to follow its own procedures. As long as checklists are used consistently, they will likely be helpful in defending a claim.

Should agencies develop their own checklists or purchase them? Purchasing industry standard checklists is a good way to ensure they are comprehensive and up to date. Many agency management systems include checklists as well, but remember:

Their value is limited unless each agency employee uses the same checklist consistently.

Checklists are also a great way to sell more insurance. Some clients are only concerned with minimizing premium and will never even consider additional coverages or limits, but these clients are the most likely to suffer an un(der)insured loss and blame it on you. You may be surprised—once in a while, common sense prevails, and even the most miserly of clients chooses to buy additional coverage after going through a checklist.

If an agency faces an E&O claim and is insured under a Swiss Re Corporate Solutions policy, using checklists may provide another financial benefit. Under the Deductible Reduction feature, if an insured agency generates and maintains contemporaneous written documentation in the agency file of a client’s refusal to accept any type of coverage or limit offered by the agency, and a subsequent claim alleges the failure to secure such, 100% of the agency’s deductible for that claim will be waived up to a maximum of $25,000, or until dismissal of the allegations, whichever is first.

Agencies that consistently use coverage checklists reduce their E&O exposure by ensuring that a brief discussion occurs about available coverages and higher limits, and by providing highly credible documentation of the discussion if a dispute occurs later. Checklists also increase cross-selling opportunities and lead to additional sales of policies or endorsements the client may not have thought about.

John Nesbitt is an assistant vice president, claims specialist with Swiss Re Corporate Solutions and works out of the office in Kansas City, Missouri.

Insurance products underwritten by Westport Insurance Corporation, Kansas City, Missouri, a member of Swiss Re. 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.

> J OHN NESBITT

Assistant Vice President, Claims Specialist with Swiss Re Corporate Solutions

wisconsin INDEPENDENT AGENT

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Q:

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Carrier Response & Fraudulent Allegations If an insured has coverage for third-party property damage, but insists that they are not responsible for a claimant’s allegations, can the insured refuse to submit the claim to their insurance carrier and advise the claimant to file with their own carrier or pursue legal action?

Essentially does an insured have the right to not have their insurance carrier respond to what they believe are fraudulent allegations? Do they have the right to not file a claim?

A: It is their right to deny reporting, but coverage will be lost if the claim follows. The policy has a condition requiring “prompt notification of a claim” and “cooperation” with the insurer.

----------There are actually two situations here.

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If the insured has a claim and doesn’t report it, that’s their choice but they have to deal with the consequences: possible denial or reservation of rights letter.

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If they tell you, you have a duty to report it to the carrier since you are an extension of the company by contract. If you don’t report it you suffer the consequences...an E&O claim and possible contract termination.

----------Is the insured willing to be responsible for any thirdparty damages when the insurance company denies a subsequent claim for failure to report under the terms of the policy?

As agent for the company you have separate duties to inform the carrier with information you possess related the risk. Failure to report known “...facts, circumstances or information that may lead to a claim...” are a time bomb all around. If the insured - or the agent - is in possession of information related to a potential claim and fails to report known circumstances, the clock can tick right into an E & O lawsuit.

----------A better question might be, does an agent have the right to withhold information of a claim from the insurance company once it has been notified of that claim? I think not.

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wisconsin INDEPENDENT AGENT

Yes, but if they do, the carrier may have no obligation to defend when the other party DOES file a lawsuit - if the delay is prejudicial. On top of that, YOU now likely have a responsibility, as an agent of the carrier, to report the situation.

----------Yes -- but that would be ignorant and foolish since then it will have violated its policy conditions and it cannot expect to receive any defense and indemnity should the other party continue to pursue the claim - or should the other party’s insurer file a subrogation action against your client. Review the policy conditions about reporting of incidents, claims, etc.

You, as a licensed insurance agency, might be obligated under the insurance code of your state -- or under your agency contract - to report all claims to the insurers. If you don’t then you might violate the law, violate your agency contracts and have an E&O claim filed against you.

--------You have to read the policy conditions and I assume it will read similar to most policies which states: General Conditions 2. Duties in the Event of Occurrence, Offense, Claim or Suit a. You must see to it that we are notified as soon as practicable of an occurrence or offense which MAY result in a claim.

What this is saying is the insured has to report all matters which may result in a claim and if they fail to do this they have violated the policy conditions and the insurance carrier could deny the claim should it blow up and turn into a mess in the future.

Insurance companies don’t just hand over money to claimants, if the insured isn’t legally obligated to pay for the property damage the insurance carrier isn’t going to pay the claim.

The insured needs to report this to the carrier.

----------The insured has the right not to turn in a claim. Of course, they are in violation of the policy conditions and are without coverage or defense in the event a claim or suit is brought against them. The insured does not determine liability, the carrier or a court does. As the agent, if you are aware of a liability situation, you are obligated as a representative of the carrier to turn it in. Some would say just to get it in writing the insured said not to turn in a claim. I think this is dangerous. Take yourself out of a potential E&O claim.

----------Of course, but if they violate the loss reporting provisions of the policy, the insurer may use that as grounds for refusal to provide coverage if the matter goes south later.

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may well find themselves funding their own defense and settlement. Of course, they are free to tell their insurer their thoughts regarding the claim and provide any support for their view that it is fraudulent. So, while they can do or not do what they want, in my view it would be very foolish not to bring their insurance coverage into such a situation.

----------That is not your or their decision. By doing so you are not allowing the carrier to determine or offer a defense to the alleged allegations. If there is the presence of fraud not disclosed within your request as to the nature of the claim, you are becoming the carrier of record. Turn the claim in and allow the carrier to investigate. Remember there is a time constraint for the reporting of a claim.

----------Almost all policies require the insured to “promptly report all losses.” That does not mean “losses they want to report.”

Also, if the agency is aware of a loss like this there is a good probability that the contract signed with the insurer requires the agency to report the loss to the insurer.

Nobody can force an insured to tell their insurance company about a third-party claim; but if they don’t, they

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GRANGE INSURANCE NAMES JILL WAGNER KELLY EVP, CHIEF DISTRIBUTION AND AFFILIATE OFFICER

About Grange Insurance Grange Insurance Company, with nearly $3 billion in assets and more than $1.2 billion in annual revenue, is an insurance provider founded in 1935 and based in Columbus, Ohio.

Through its network of independent agents, Grange offers auto, home, life and business insurance protection. Life insurance offered by Grange Life Insurance and Kansas City Life Insurance. Grange Insurance Company and its affiliates serve policyholders in Georgia, Illinois, Indiana, Iowa, Kentucky, Michigan, Minnesota, Ohio, Pennsylvania, South Carolina, Tennessee, Virginia and Wisconsin.

ACUITY EARNS NATIONAL RECOGNITION FOR TECHNOLOGICAL INNOVATION

WAGNER KELLY WILL REMAIN PRESIDENT OF INTEGRITY INSURANCE APPLETON, WI (June 20, 2019) – Grange Insurance and its affiliate partner Integrity Insurance are announcing that Jill Wagner Kelly has been named Executive Vice President, Chief Distribution and Affiliate Officer.

Currently President of Integrity Insurance, headquartered in Appleton, WI, Wagner Kelly has led the company to five straight years of above-market growth and profit through partnership with independent agents. Wagner Kelly will expand her current role to lead Sales and Marketing efforts for the combined Grange and Integrity enterprise.

“Jill has achieved outstanding results leading the Integrity organization,” said John Ammendola, President and CEO of Grange Insurance. “Aligning our Sales and Marketing organizations will bring even greater strategic decision-making to support and serve our independent agents and policyholders in this rapidly changing digital landscape.”

Wagner Kelly is an accomplished executive with more than 25 years of insurance industry experience. She started her career as a Personal Lines underwriter with Acuity Insurance, quickly moving into leadership roles at SECURA Insurance where she continued to gain greater and broader expertise in Commercial Lines and building highly successful teams that deliver exceptional customer experiences. She joined Integrity Insurance in 2010 as VP, Commercial Lines and was promoted to the President role shortly thereafter.

Wagner Kelly is a 1992, summa cum laude, graduate of Lakeland College in Sheboygan, Wisconsin, where she also earned her MBA. She’s active with NAMIC and serves on the Board of Directors for United Way, Big Brothers Big Sisters of the Fox Valley and Prospera Credit Union.

About Integrity Insurance Integrity Insurance established in 1933 and is based in Appleton, WI. Integrity offers auto, home and business insurance through a network of independent agents throughout IA, MN and WI. With partner Grange Insurance based in Columbus, Ohio — the 13-state enterprise has nearly $3 billion in assets and $1 billion plus in annual revenue and holds an A.M. Best rating of “A” Excellent. For more information, visit IntegrityInsurance.com.

Acuity received an Award in Innovation from the National Association of Mutual Insurance Companies (NAMIC). The insurer earned NAMIC’s top award for innovations that had the greatest impact.

“We are honored to be recognized for technological innovation,” said Ben Salzmann, Acuity President and CEO. “This award is another example of Acuity’s technological leadership in the insurance industry.”

The award recognizes the impact of Acuity’s chat and co-browse systems, which create an online dialogue between an Acuity service professional and a customer or independent insurance agent to answer questions in real time. Acuity staff can simultaneously view an agent’s or customer’s computer screen, helping guide them through common functions and resolve issues.

Acuity’s system also incorporates a “chat bot,” built on sophisticated artificial intelligence technology, that can handle many common questions without the need for human intervention. Customers and independent insurance agents can always choose to work directly with service professionals or opt out of the chat system at any time.

“Acuity recognizes that people appreciate options in customer service from their insurance carrier and expect that service is done right,” Salzmann said. “Our focus is on letting customers and agents communicate with Acuity through whatever way or channel they prefer and not requiring a particular way of interaction.”

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