wisconsin
INDEPENDENT AGENT JUNE 2018
2018
LEADERSHIP C NFERENCE JULY 18-20 WILDERNESS RESORT WISCONSIN DELLS
REGISTER AT IIAW.COM
EMERGING LEADERS
DISCOVER WHAT WE COVER.
We provide
BOP CybermoreLiability than Property General Liability Workers’ Comp
Commercial Auto
Employment Practices Liability Insurance
Inland Marine Commercial Package monoline coverage.
Get to know AmTrust. Discover what we cover at d20.amtrustinsurance.com AmTrust is AmTrust Financial Services, Inc. located at 59 Maiden Lane, New York, NY 10038. Coverages are provided by its property and casualty insurance company affiliates. In TX, coverage is provided by AmTrust Insurance Company of Kansas, Inc., AmTrust International Underwriters Designated Activity Company, Associated Industries Insurance Company, Inc., First Nonprofit Insurance Company, Milford Casualty Insurance Company, Republic Underwriters Insurance Company, Republic-Vanguard Insurance Company, Security National Insurance Company, Southern County Mutual Insurance Company, Southern Insurance Company, Technology Insurance Company, Inc., or Wesco Insurance Company. In WA, coverage is provided by AmTrust Insurance Company of Kansas, Inc., AmTrust International Underwriters Designated Activity Company, Associated Industries Insurance Company, Inc., Developers Surety and Indemnity Company, Milford Casualty Insurance Company, Security National Insurance Company, or Wesco Insurance Company. Consult the applicable policy for specific terms, conditions, limits, and exclusions to coverage.
wisconsin
INDEPENDENT AGENT JUNE 2018
Leadership Conference. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Open Door Policy Are you Handling the Winds of Change in Your Business?. . . . . . . . . . . . . . . . . . . . . . 6 Agency Operations 3 Tasks Insurance Leaders Must Perform to Grow their Agency. . . . . . . . . . . . . . . . 8 Government Affairs State Lawmakers not Seeking Re-election in 2018. . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Agency Operations The Bottom Line Enhancing Agency Productivity and Profitability . . . . . . . . . . . . . 12 Sales Differentiating Selling from Consulting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Commentary from Counsel Supreme Court Permits Employment Claims Arbitration & Class Action Waivers. . . 17 Employee Benefits Employers are Accelerating Adoption of Benefits Technology. . . . . . . . . . . . . . . . . 18 Errors & Omissions Smart Agencies: Keeping up in the Age of the Internet of Things . . . . . . . . . . . . . . 20 Industry News Notice to Your UIM Carrier Four Years After the Accident?. . . . . . . . . . . . . . . . . . . 22 Virtual University Alternatives to Business Coinsurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Why Ask the Underwriter. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Emerging Leaders Spotlight Michelle Jimenez, John Wickhem Agency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Risky Business Making Promises You Can’t Keep: E&O Exposures on Agency Websites. . . . . . . . . 27 Members in the News. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Food for Thought. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Independent Insurance Agents of Wisconsin 725 John Nolen Drive, Madison, Wisconsin 53713 Phone: (608) 256-4429 or (800) 362-7441 ■ Fax: (608) 256-0170 ■ Web: www.iiaw.com Executive Vice President - Matt Banaszynski 2017-2018 Executive Committee President............................................................ Lise Meyer Meyer Insurance - P.O. Box 633, Sauk City, WI 53583 President-Elect.................................................... Jason Bott Robertson-Ryan & Associates - 330 East Kilbourn Ave., Milwaukee, WI 53202 Secretary-Treasurer......................................Chris Costakis Avid Risk Solutions- 2501 Parmenter Street, Ste 200A Middleton, WI 53562 Chairman of the Board................................. Matt Weimer Diversified Insurance Solutions - 100 North Corporate Dr., #100, Brookfield, WI 53045 State National Director ................................Steve Leitch Leitch Insurance - P.O. Box 85, River Falls, WI 54022 2017-2018 Board of Directors Mike Ansay, Ansay & Associates 101 East Grand Ave. #11, Port Washington, WI 53704 Cindy Burns, Burns Insurance 500 South Central Ave., Marshfield, WI 54449 Marc Petersen, American Advantage-Petersen Group 15171 W. National Ave., New Berlin, WI 53151 Jack Riesch, R&R Insurance Services P.O. Box 1610, Waukesha, WI 53187-1610 Chad Tisonik, HNI 16805 W Cleveland Ave, New Berlin, WI 53151 Pam Utpadel, Universal Insurance Advisors 100 West Lawrence St. Suite 313, Appleton, WI 54911 Ryan Waite, Neckerman Insurance Services 6200 Mineral Point Road Madison, Wisconsin 53705 Darrel Zaleski, Spectrum Insurance Group 4233 Southtowne Drive, Eau Claire, WI 54701
WISCONSIN INDEPENDENT AGENT
On The Cover… IIAW’s Emerging Leaders Committee has constructed one of the finest leadership and professional development conferences in the country. Join leaders from across Wisconsin from July 18-20 at the Wilderness Resort in the Wisconsin Dells and hear from Internationally renown speakers Jeff and Una Roy on how to build the agency of the future. In addition, there will be many other well-known and respected speakers on topics from social media to insurance industry technology to pollution gaps in commercial general liability and property policies to Cyber risk. This is one event you won’t want to miss.
> A DVERTISERS & INFORMATION
2017-2018 Committee Chairs
AAA Wisconsin................................................. 30
Agency Services ............................................Kim Dandrea M3 Insurance - N19 W24200 Riverwood Dr. Waukesha, WI 53188
AM Trust............................................................ 2
Automation/Technology ...............Cathleen Christensen Hierl Insurance - P.O. Box 949, Fond du Lac, WI 54936
Badger Mutual.................................................. 19
Emerging Leaders ..........................................Ryan Waite Neckerman Insurance Services - 6200 Mineral Point Road Madison, WI 53705
Berkshire Hathaway/Guard............................. 23
Employee Benefits.......................................... Mike Farrell David Insurance - 1300 South Green Bay Rd Racine, WI 53406 Government Affairs .......................................Jeff Thiel R&R Insurance Services - P.O. Box 161 Waukesha, WI 53187 Carrier Relations ......................................... Kevin Murray Johnson Insurance Services - 525 Junction Road, Madison, WI 53717 Marketing/Membership Development....Jamie Durocher Arlington Roe- 2 Carlson Parkway N., Suite 175 Plymouth, MN 55447 Technical...............................................Timothy Kakuska Robertson-Ryan & Associates - P.O. Box 547 La Crosse, WI 54602
IIAW Pre-licensing Classes.............................. 26 IIAW CE.............................................................10 Keystone Insurers Group.................................. 21 Partners Mutual............................................... 19 ProtectYourAgency.com..................... back cover Robertson Ryan & Associates........................... 13 The IMT Group.................................................. 19 West Bend........................................................ 31 Western National.............................................. 16 JUNE 2018 | 3
2018
LEADERSHIP C NFERENCE JULY 18-20 WILDERNESS RESORT WISCONSIN DELLS
REGISTER AT IIAW.COM
EMERGING LEADERS
SCHEDULE OF EVENTS WEDNESDAY, JULY 18 3pm -4pm
ow to Prevent Agents E&O: Pollution Coverage Gaps in Commercial H General Liability and Commercial Property Policies (1 CE)
Dustin Helmenstine, American Risk Management Resources Learn the details of the pollution exclusion commonly found in General Liability and Property policies using claim scenarios.
4pm-6pm
Wilderness Escape Room
A Leadership Conference ffiirst, 12 attendees at a time will have 60 minutes to solve clues and puzzles and navigate their way out of either The Basement Room or The Hotel room, located on-site at the Wilderness Resort.
5pm-8pm
Poolside Cabana
Grab some food and a drink and relax! The poolside cabana is back and you don’t want to miss it! Sponsor: SECURA Insurance
THURSDAY, JULY 19
“Excalibur Culture”. Participants will learn what Excalibur does to keep the team motivated to go above and beyond and provide a WOW experience to their clients.
12pm-1pm 1pm-2pm
Lunch Roundtable – Insurance Industry Technology Experts
Moderator: Matt Banaszynski Wilderness Ballroom Hear from the experts on the latest technology trends impacting the insurance industry and how your agency can stay one step ahead. Panel: Greg Kirsch, Ansay & Associates; Bob Van Beek, Secura; Pete Weigel, Midwest IT
2:15pm-4:15pm “ How to Become a Social Media Rockstar” including a special presentation on “Creepy Facebook Ads”
Spencer X Smith, Founder of SpencerXSmith.com Wilderness Ballroom Social media is the best means ever invented to grow both your personal reputation as well as that of your organization. Spencer will share stories and strategies that have worked for him and that you won’t hear anywhere else.
8am-9am Breakfast 9am-9:30am Welcome Presentation: Emerging Leaders Committee Update
5:30pm-9pm
9:30am-11am Building the Digital Customer Experience
FRIDAY, JULY 20
Dan Lau & Ryan Waite Wilderness Ballroom
Jeff Roy, President & CEO Excalibur Insurance Group Wilderness Ballroom There are pivotal moments in every business category where success can be rendered simply by changing your perspective, or angle of approach. The consistent thread for every company who wants to build a tribe of raving fans is simple. Stop thinking “Digital Technology” and start creating “Emotional Relevance”. Join Jeff Roy as he takes you under the hood and shares his team’s path to humanizing the digital experience. You’ll learn why they exist as a brand, and how they implemented a multi-faceted digital strategy to evoke emotional relevance as a fundamental element of their customer journey. Learn how Excalibur generates 450 to 600 quotes every month and has developed a sales process to give their prospects and clients a unique experience.
11:15am-12pm
Insurance Employee Experience
Una Roy, VP Operations Excalibur Insurance Group Wilderness Ballroom During this 45-minute presentation, Una Roy covers what she will explain as the
Backyard Patio Party Wilderness Resort Outdoor Patio After a day full of interesting topics and conversation, it’s time to relax on the patio at the Wilderness Resort. We will have plenty of food and drinks, plus outdoor games for everyone to enjoy.
8am-9am Breakfast 9am-11am Federal and State Data Privacy Laws: Are You Compliant? (2 CE) Bill Larson, NetGen Data Security Consulting Wilderness Ballroom Improve your understanding of the Gramm-Leach-Bliley Act (“GLBA”) with respects to the law and its importance to insurance agents and the impact of non-compliance on a carrier relationship and contracts.
11:10am-12pm Cyber Risk: What Are the Threats and How To Be Protected? (1 CE) Edward Chang, SVP Cyber Risk Management Travelers Wilderness Ballroom He has prosecuted Romanian phishers, Nigerian fraudsters, and other computer hackers and cyber criminals. Eddie Chang discusses the top threats insurance professionals are facing and the steps to take to protect information as well as your reputation.
12pm
Conference Ends
FEATURED SPEAKERS
REGISTRATION INFORMATION
Jeff Roy As the CEO of the Excalibur Insurance Group, Jeff’s
willingness to invest, will challenge you to be better. As a leader and coach Jeff is fueled by 3 things - technology, people, and big ideas. He also believes that the pinnacle of innovation for an entrepreneur is best measured by the number of times you’ve tried something new - and learned from the adventure when it didn’t go as planned. What gives Jeff and his Excalibur team their edge? His peers believe it’s because he refuses to wait for someone else to make a difference. In 2016 Roy and Excalibur won Aviva Canada’s ffiirst Broker’s Hackathon. A contest designed to encourage groundbreaking ideas on how technology can enhance the industry. And you may be surprised to learn that Excalibur Insurance is not in the insurance business; they’re in the experience business. As evidenced by the way they’ve challenged the status-quo, once you start looking at your business that way, it totally changes your perspective.
Una Roy She faces every obstacle, with Everest-like expectations.
In fact, after more than 22 years in the insurance industry, don’t even think about throwing a challenge in Una’s path unless you’re looking for serious results. Some call it leadership, but those who know her best will simply tell you she always had a knack for creating repeatable success and attracting the right people. The reality? Regardless of context, Una loves building a game plan that increase the odds of winning. She’s proven that a well-designed system can attract and empower people to achieve the unexpected. The result? She and her team of volunteers raised an unprecedented $500,000 in a community with only a population of 3200. As Excalibur’s VP of Operations, she’s came to the same conclusion years ago - talent doesn’t fififind you by chance. Una believes that ffiirst you need to know “what you stand against”, and then you need to engineer a system that makes it easier to attract and inspire like-minded people who live to make a difference. As a coach, leader, colleague, wife, mom, volunteer and friend - when it comes to fifinding a better way to help, Una’s always been hardwired for success.
The IIAW Leadership Conference registration options (fififind full descriptions at IIAW.com):
Option 1: Full Registration - $239 Members; $259 Non-Members After June 13 - $259 Members; $269 Non-Members
Option 2: Non-Industry Spouse: $119 Option 3: Children (5 & Older) - $40. Children 4 & Under – FREE
WATERPARK PASSES
Guests receive waterpark wristbands at check-in and have access to all waterparks on the Wilderness Resort property. Guests may obtain wristbands any time after 12PM even if rooms are not ready until check-in at 4 PM.
CANCELLATIONS
Cancellation request received by June 18, 2018, 2018 will receive a complete refund. After the cut-off date, there is a 72-hour cancellation policy per room. Reservations cancelled prior to the 72hour mark will be charged a $30 fee. Cancellations within 72 hours will pay the entire room rate.
HOTEL INFORMATION
Room Rates: July 18 & 19 - $169.99; July 20 - $199.99. For reservations, call (800) 867-WILD and note that you are attending the IIAW Leadership Conference. Refer directly to the Wilderness Resort for full reservation and cancellation policies at the wildernessresort.com. The Wilderness Resort is at 511 E Adams St, Wisconsin Dells. The hotel reservation deadline is June 18, 2018. All conference events are hosted at the Wilderness Resort. Conference dress code is resort casual.
REGISTER AT IIAW.COM
EXCLUSIVE SPONSORS
PARTNER SPONSORS Aflac
Central Insurance Company
Partners Mutual
Wisconsin Mutual
Amerisafe
CNA Insurance
Philadelphia Insurance
WPS Health Insurance
Arlington/Roe & Co.
EMC Insurance
QBE
Zurich Insurance
Auto-Owners Insurance
Madison Mutual
OPEN DOOR POLICY
ARE YOU HANDLING THE WINDS OF CHANGE IN YOUR BUSINESS BY BUILDING A WINDMILL OR A WALL? I read a great article by Sydney Rowe, of Agency Nation called Insurance tech companies are not competing on price they are competing on....... In it, Sydney talks about the new #insurtech companies and disruptors like Trov, Lemonade that are coming up with end to end solutions, that will cut out the broker or the agent in their protection experience. These #insurtech companies are targeting micro niches or hyper targeted markets with a brand, message and solution that speaks loudly and emotionally connects with smaller groups using the power of story. Specialist always out preform generalists. These new companies are not competing on price but are competing on the customer experience. Sydney concludes the customer experience is the hotness and is lighting up the industry. Take a good look in the mirror at your agency, brokerage or business. Is your current customer experience lighting people’s fire in a hot, fun, engaging and easy way. The article got me thinking of what #brokers and #agents need to do in order to work together and build the new #insurance experience 3.0. One thing for sure, with #insurtech startups like #insureon getting $40 million from venture capital funds and Lemonade getting $13 million, Trov getting $14 million, Metromile $191 million agents and brokers cannot build the next generation experience on their own. They cannot reboot their client experience using the ways and processes of the past either. What brought your agency or brokerage to its current point will not be enough in the future. Our industry, during this windy time of mind blowing change, has been our own worst enemy. I think the Chinese, as always, said it best “When the winds of change blow, some build walls, others build windmills. Our industry has been hiding behind walls instead of building our new customer experience windmill. We hide behind sayings like, “we have always done it that way”, “our business has been successful the last 20 years why should we change” and my all-time favorite “ Our agency gives great service, so we are fine”. When you say your agency provides great service it’s like showing a consumer a picture of 10 lawyers and asking them to spot the best one in the picture. The consumer cannot spot the better lawyer or agent in a picture, so in absence of any differentiation or value-added services, consumers use the century old factor called price to make their decision where they are going to spend their money. The new #insurtech boys and girl coming into the insurance industry are not playing by these rules and as an agency or broker owner you shouldn’t still be either. We blame companies for bad portals, our vendors for being too slow to build us the tools and the integration we need to compete and evolve the experience. We complain about technology changing too quickly or just being a fad. We complain consumer what things fast and 24-7. When things do not go well we rely on industry associations to save us, we blame the economy. What we don’t do is take ownership and responsibility for the position complacency has put many in the insurance industry in. Our industry has felt entitled and above change.
6 | JUNE 2018
How is this working for us now? I have bad news. History doesn’t give a #$$% if you are entitled or about your companies past 30 years. In Theodore Levitt famous Harvard business review article, Marketing Myopia, he says “The history of every dead and dying “growth” industry shows a selfdeceiving cycle of bountiful expansion and undetected decay.” Our industry has been decaying and we need to stop it. It’s not the people who feel entitled or the one who puts up the biggest wall that wins in the market place, it’s the one who adapts to change who survive as Charles Darwin told us back in 1809. How well are Kodak and Block Buster doing now? How many travel agents are left vs. 25 years ago? The travel agents who adapted have adapted and changed their model and so much agents and brokers follow in their in their path. Dwight Eisenhower said” It is neither a wise man nor a brave man that lies down on the tracks of history to wait for the train of the future to run over him” We need to build the windmill of change and not get run over by the train of the #insurtech future. The good news, unlike block buster it’s not too late. All of us are aware of the building blocks of the windmill of change. Some of the critical ones in our industry (but not all) are broker or agency management system with great API integration, big data, IOT solutions, Virtual reality, emailing and texting solutions, lead management and routing solutions, Better insurance dashboards and with the ability to track KPI and cost of acquisition, voice recognition software, call recording software, self-service insurance options for clients 24-7 through different touch points, mobile insurance applications with real wow features, Artificial intelligent #AI chat bots, SEO, social media, content, video strategies, digital sales funnels, service and retention strategy, mobile websites, new products or solutions that address sharing economy. Now imagine wrapping all of these things into your agency with your people, developing processes and best practice to use these building blocks and the wrapping a kick ass agency brand around this. This is your journey to build Insurance experience 3.0 You can see some of the trends along the innovation curve illustrated here of how the different new trends are flowing down the innovation curve (Google compare is gone for now) We need to move and adjust our windmill to capture the wind from some of these changes.
The Formula for Insurance Experience 2.0 #(ICX2.0) people + process + technology + brand + product = customer experience 2.0 The success formula has not changed much over the years, just lots of new and different things in each variable in the formula. For instance, technology variable has a lot more building blocks from the days when brokers and agents used fax machines as their fastest way of communicating. How do we move from Insurance experience 2.0 to 3.0? WISCONSIN INDEPENDENT AGENT
OPEN DOOR POLICY
8. Watching your competitors and learning. Visit their websites. Follow the social media feeds.
The New Formula for Insurance Experience 3.0 #(ICX3.0)
9. Seminars
people x process x technology x brand x solution = customer experience 3.0
10. Courses.
Can you spot the difference in the equations? For all the non-math people we are multiplying vs. adding in the new world? Why? The weakest link in this formula will limit your agency’s chance of survival or growth. Doing the math, you can see what a zero or a low score in any one category can do to your experience score. As each variable has so many sub-variables that can affect it (way more than 10 years ago) we need to change the formula from adding to multiply. The more you improve each of the sub variables and get them to world class status, the better your chances of growing your business, as Grant Cardone would say, 10x and being a long-term player. I have also changed the term product to solution. Solution makes you think broader in terms of what you bring to the market. It’s not about building a better auto insurance policy it is about building a better auto protecting experience? Also, your solution does not just have to be an insurance product. What if you can sell other products and services to your client to box them in and increase the average revenue per client. New revenue sources will be key How do you improve these variables? Hard work, sweat, effort, experiments and dealing with failure and setbacks. New processes, technology, ideas can come from a number of sources. 1. Coaches, mentors and consultants - Find someone who is still doing it in the real world. Do not find the expert from 10 years ago. 2. Books - Leaders are readers. If you’re not reading ever day your loosing. 3. Mastermind Groups 4. Insurance organizations
11. Collaboration with insurance companies - #Aviva hackathon 12. Working with your vendors and pushing each other to a new level. You have to become more to have more? In your agency or brokerage are you becoming more? As John Spence would say Is your internal agency or brokerage rate of innovation greater than your external market? The disruptors should not scare us we should scare ourselves. The Agent side of the industry is not growing, learning, experimenting, testing and collaborating fast enough. I would even suggest the disruptors are innovating faster than us. They are not entitled, they do not have legacy thinking or stinking thinking. They do not know, and they do not care how it has always been, as they are creating what it will be. They see our market with a new set of glasses. The good thing is there is still time and if you are passionate and care about this business you will start building your new Windmill and changing your business today. To move we need to take risk. It’s funny we are in the business of insurance to manage risk for people but nobody in our industry wants to take any risk. Most agents and brokers want to get through the turn style of life with someone else’s push. Let’s overcome the biggest monster holding us back, our past success and ourselves. It is time agents and brokers started to play for the broker industry logo on the front our jerseys and not for the agency name on the back of the jersey. Talk about collaboration and working together is cheap. Time to give back, work hard and together to start building our new insurance experience 3.0. There is lots of wind out there we just need to improve how we harness it with our new Windmill we will call Customer Insurance Experience 3.0. If we don’t the disruptors are going to continue to kick down our wall.
5. Industry technology organizations 5. Non-insurance industry groups. 6. Podcast - Agency Nation, Jason Cass, Monday Mornings agency online. 7. Pay attention to social and technology trends WISCONSIN INDEPENDENT AGENT
COME TO IIAW’S LEADERSHIP CONFERENCE July 18-20th AT THE WILDERNESS RESORT IN THE WISCONSIN DELLS AND HEAR JEFF AND HIS WIFE UNA ROY PRESENT ON BUILDING THE DIGITIAL CUSTOMER EXPERIENCE AND THE INSURANCE EMPLOYEE EXPERIENCE. >G UEST COLUMN: Jeff Roy, CEO Excalibur Insurance Group, Author, Speaker, Innovator.
JUNE 2018 | 7
AGENCY OPERATIONS
3 TASKS INSURANCE LEADERS MUST PERFORM TO GROW THEIR AGENCY
It’s time for insurance leaders to choose their destiny. The choice is simple, continue as usual or optimize for the future.
1. Sales 2. Prospecting/Networking
If you could pick just three activities or tasks that add the most value to your business what would they be? Now imagine you could have someone do everything else. I recently asked Twitter the same question and got a ton of amazing responses. I captured these little nuggets of wisdom and compiled them accordingly. For the record, most of these responses we from producers or agency principles and leaders of their respective organizations. These are people focused on production. Here were the three most popular responses.
8 | JUNE 2018
3. Marketing/Branding After the top three a couple other popular tasks were storytelling, strategy and culture. Note: It’s interesting that marketing and branding were considered to be the same thing.
tasks are so vital to our business (and always have been), why are we doing anything else? Why (as leaders) are we still processing car changes and responding to customer service calls? Why are we wasting insane amounts of time filling out of policy form documents and spending half our day inside of agency management systems? The answer is, it makes us feel busy.
I’m not sure what that means, if it’s right or wrong, but it’s definitely interesting. However, those top three tasks aren’t surprising, they’ve always been the core of an insurance business. The more important question is, if these
We do the easy, mindless, busy work because it feels productive when in truth these tasks add little to no value to our organization.
Insurance Leaders Must Choose the Hard Stuff
WISCONSIN INDEPENDENT AGENT
AGENCY OPERATIONS Selling, prospecting, networking, marketing and branding… this is the hard stuff.
business because it’s the one thing that will always keep the lights on.
You must be intentional.
All these tasks take creativity, patience, persistence, and all the other unmeasurable soft skills built over a 1,000 “No” responses and failed campaigns.
3) Content Marketing Content is the lifeblood of your sales and marketing operation.
How do you make that happen?
It takes true leadership to stay busy doing the hard stuff. Because you want to give up.
That’s what I love to do more than anything.
• Heavy-handed delegation.
This work that takes tremendous brain power, thought, energy and focus.
Like this video taking a deep dive into Lemonade and the impact, it has on our industry.
• Scheduling (time-blocking creative work time).
Optimizing Your Time
That video took a week to create.
Now as Chief Marketing Officer, my workload is piling up. At times, I’m absolutely overwhelmed.
But the impact has been incredible, just in the first week over 2,000 people watched it.
This will allow you to optimize the value you deliver to not just your customers, but also everyone inside your agency.
• Self-discipline. <– easily the hardest of the bunch. Here’s the one catch. You have to give up some control.
It feels like I don’t have room in head for all the things that need to get done, all the decisions that need to get made, all the people who want a response. Time for me to take a little of my own advice. One of the ways I tried to answer this question, is not just asking myself, but talking to my staff.
The amount of feedback I received was overwhelming along with all the inquiries and connections it sparked. I got two speaking opportunities alone that can help expand our company brand. That’s important work all made possible by producing high-quality content.
For me, this was the easy part, but for many of you fiefdom builders out there, this is going to be the hardest part. You have to trust your people. You have to let them failure. You have to let them learn and grow and adapt. Otherwise all of this falls apart.
The Rub Just because you think you might be delivering value, doesn’t mean the people you are working with feel the same way. Because the people inside your agency and the clients you serve are ultimately the ones who need to get the most value from you.
My Top 3 Ways Insurance Leaders Deliver Value 1) Culture & Strategy I can’t separate these two. Culture might eat strategy for breakfast, but without strategy culture is just a cool idea.
Add value with intention.
At least that’s what I believe and what has worked so far for my team at Agency Nation.
The impetus of this post was my own wasting too much time in meetings, replying to nonvalue add emails and busy work. I was making bad decisions. I was spending to much time on stuff that didn’t push the business forward in a meaningful way. Don’t get me wrong, that stuff serves a purpose and is work that needs to get done, but is it the best use of MY time? No.
On the flip side, your culture allows the entire organization to execute on strategy at scale.
We’re never going to be able to completely cut out administrative stuff.
2) Selling I do as much selling as I’ve ever done in my entire career. You always have to make time to bring in the WISCONSIN INDEPENDENT AGENT
Email and meetings and admin stuff will always have a place in any job. Increasing your value as an insurance leader comes from setting boundaries.
> Ryan Hanley is the Chief Marketing Officer at TrustedChoice.com.
JUNE 2018 | 9
CONTINUING EDUCATION IIAW ONLINE & LOCATION CE CLASSES Agent Pre-Licensing School, Life & Health Date: June 4-7, 2018 Location: Madison, Wisconsin Time: 8:30 AM – 4:00 PM IIAW Webinar: Contractors Property Exposures 3 CE Credits Approved Date: June 7, 2018 Location: IIAW Webinar – iiaw.com/events Time: 8:00 AM – 11:00 AM IIAW Webinar: Income After Retirement – Where Does the Money Come From? 3 CE Credits Approved Date: June 7, 2018 Location: IIAW Webinar – iiaw.com/events Time: 12:00 PM – 3:00 PM IIAW Webinar: Top 10 Countdown of Personal Lines Coverages & Current Issues 3 CE Credits Approved Date: June 11, 2018 Location: IIAW Webinar – iiaw.com/events Time: 8:00 AM – 11:00 AM E&O Risk Management: How to Manage Changing Risks & Opportunities Date: June 12, 2018 Location: Madison, Wisconsin Time: 9:00 AM – 3:30 PM IIAW Webinar: When the Child Becomes the Parent – Aging Parents & Insurance Decisions 3 CE Credits Approved Date: June 13, 2018 Location: IIAW Webinar – iiaw.com/events Time: 8:00 AM – 11:00 AM IIAW Webinar: Unlocking the Secrets of D&O Insurance Date: June 14, 2018 Location: IIAW Webinar – iiaw.com/events Time: 12:00 PM – 3:00 PM Agent Pre-Licensing School, Property & Casualty Date: June 18-21, 2018 Location: Madison, Wisconsin Time: 8:30 AM – 4:00 PM
IIAW Webinar: Commercial Property Coverages 3 CE Credits Approved Date: June 18, 2018 Location: IIAW Webinar – iiaw.com/events Time: 12:00 PM – 3:00 PM IIAW Webinar: E&O: Roadmap to Policy Analysis – Part One 3 CE Credits Approved Date: June 19, 2018 Location: IIAW Webinar – iiaw.com/events Time: 8:00 AM – 11:00 AM IIAW Webinar: E&O: Roadmap to Policy Analysis – Part Two 3 CE Credits Approved Date: June 19, 2018 Location: IIAW Webinar – iiaw.com/events Time: 12:00 PM – 3:00 PM IIAW Webinar: Condominiums Date: June 21, 2018 Location: IIAW Webinar – iiaw.com/events Time: 12:00 PM – 3:00 PM IIAW Webinar: Business Income – Coverage Analysis through Claims 3 CE Credits Approved Date: June 25, 2018 Location: IIAW Webinar – iiaw.com/events Time: 12:00 PM – 3:00 PM IIAW Webinar: Ethics & Agent Liability 3 CE Credits Approved Date: June 26, 2018 Location: IIAW Webinar – iiaw.com/events Time: 12:00 PM – 3:00 PM IIAW Webinar: Personal Auto Policy 3 CE Credits Approved Date: June 26, 2018 Location: IIAW Webinar – iiaw.com/events Time: 8:00 AM – 11:00 AM IIAW Webinar: Who is an Insured 3 CE Credits Approved Date: June 27, 2018 Location: IIAW Webinar – iiaw.com/events Time: 12:00 PM – 3:00 PM
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GOVERNMENT AFFAIRS
STATE LAWMAKERS NOT SEEKING RE-ELECTION IN 2018 At the end of every election cycle and before a new one begins, there are always a handful of incumbent state lawmakers who decide to hang it up for whatever reason and not run for re-election. Some of those may be running for a different office and are not necessarily leaving the public spotlight (as long as they win). But for those that are leaving the political life behind for good, we thank them for their public service and contributions to their constituents and the state of Wisconsin. Having worked in politics for more than 20 years, Iâ&#x20AC;&#x2122;ve observed that running and serving in public office whether it be at the local, state or federal level is often times a thankless job requiring long hours away from the family
- Rep. Ed Brooks (R-Reedsburg)
and minimal pay. The present day salary for legislators serving in the Wisconsin Legislature is $50,950. And while they are not in session on a daily basis taking votes in Madison, they usually are racking up miles driving from one corner of their legislative district to the other in order to attend some event like a towns association meeting, ribbon cutting ceremony or early morning pancake breakfast. In an era of increasing personal attacks, political tribalism and negativity, itâ&#x20AC;&#x2122;s easy to overlook the important role legislators play and the
Not seeking re-election
- Rep. Terese Berceau (D-Madison)
Not seeking re-election
positive contributions many of them make to our state. This year, a total of 16 incumbent legislators have announced they are not seeking reelection in 2018. If you recognize any of them below as your elected representative where you reside or work, please consider taking a brief moment to wish them well and thank them for their public service to your community. > Misha Lee, IIAW Lobbyist
- Rep. Jesse Kremer (R-Kewaskum)
Not seeking re-election
- Sen. Terry Moulton (R-Chippewa Falls)
Not seeking re-election
+
Rep. Kathy Bernier (R-Lake Hallie) Running for State Senate
- Rep. Lee Nerison (R-Westby)
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Rep. Eric Genrich (D-Green Bay) Running for Mayor
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Sen. Leah Vukmir (R-Brookfield) Running for U.S. Senate
+
Rep. Andre Jacque (R-De Pere) Running for State Senate
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Sen. Kathleen Vinehout (D-Alma) Running for Governor
Not seeking re-election
- Rep. Adam Jarchow (R-Balsam Lake)
Not seeking re-election
- Rep. Tom Weatherston (R-Caledonia)
- Rep. Joel Kleefisch (R-Oconomowoc)
Not seeking re-election
+
+
Rep. Dale Kooyenga (R-Brookfield) Running for State Senate
WISCONSIN INDEPENDENT AGENT
Not seeking re-election
Rep. Dana Wachs (D-Eau Claire) Running for Governor
- Rep. Leon Young (D-Milwaukee) - Not seeking re-election JUNE 2018 | 11
AGENCY OPERATIONS
THE BOTTOM LINE ENHANCING AGENCY PRODUCTIVITY AND PROFITABILITY Every agency would like to start the New Year with three targets firmly in mind, Growth, Productivity, and Profitability. Yet most will do so by the ‘seat of their pants’, wishing that 2018 will be better than 2017, but doing nothing constructive to realize that wish. Did you know why the gold miners in California in the nineteenth century called themselves the “Forty-Niners”? James Wilson Marshall actually found gold at Sutter’s Mill in the American River at Colona, CA in JANUARY, 1848. But the people who read the news in the San Francisco papers simply didn’t believe the stories because there was not enough evidence of the find. Once the gold started flowing, the people came by the hundreds of thousands - but it took a full year before the “FortyNiners” flocked to try their luck at gold panning. What does gold panning in 1849 (or 1848) have to do with running an independent agency in the 21st Century? In both cases, commitments will not be made to do the most productive things until the participants know enough about the situation to determine what that right thing really is. In 1848 the delays were caused by the lack of substantiation and evidence that there was gold in the river for the taking. Well there is GOLD in your agency for the taking and all you need to do is know where to “pan” or where to “dig”. You have the same problem as the skeptics in San Francisco in 1848. You are very aware of the market conditions and the effect it has had on your agency but you are not yet aware of how your agency can be ‘jump-started’ to enjoy the double-digit growth and double digit profits that are still enjoyed by a minority of agencies in the U.S. who know and capitalize on their strengths and know their weaknesses and work diligently to develop them. How do you know your strengths and weaknesses? By driving empirical data from your agency activities and results, evaluating those activities and results according to a) your own history, b) agency averages such as Agency Consulting Group, Inc.’s Composite Group annual data sets, and c) the activities and results of the high performing agencies around the country (many of Agency Consulting Group, Inc.’s clients). Here is just a few examples of things you should know about your own agency and how to analyze them. They come from Agency Consulting Group, Inc.’s GPP (Growth, Productivity, and Profitability) Analysis that we do at the initiation of every client relationship.
BOOK OF BUSINESS ANALYSIS Do you write an (overall) profitable book of business across all companies? Are you generating an appropriate level of contingency on that business? Pull out your last year-end Production and Loss reports from each company that you represent, or at least the companies that represent at least 80% of your premium writings. You will not be able to get them from E&S sources and might not get these reports routinely from smaller carriers. But the carriers with whom you are licensed as an agent has them available and should be sending them to you at least once each year.
12 | JUNE 2018
Create a spreadsheet that includes the primary Lines of Business (personal and commercial) with Written Premium, Earned Premium, and Incurred Losses for each line by carrier. It should look something like this:
Enter your appropriate information in the cells provided. Combine all companies’ information into a combined Line of Business Analysis for all common personal and commercial lines across all companies represented. The result will be a line-by-line loss ratio FOR YOUR AGENCY instead of for a single carrier. If your loss ratio in any year was affected by one or two shock losses, you can footnote them and provide a loss ratio display both with and without the catastrophes. This information will provide you, and any carriers that you are trying to attract, a complete picture of the quality of your underwriting over time. The Combined section at the top will show them your last year’s performance. The Combined section below will show them the historical performance of your agency and whether participation with their carrier can be beneficial to you as well as to the prospective carrier by calculation of their contingency in real time loss ratio and volume views.
TOP ACCOUNTS Identify the Top Accounts in your agency by revenues (commissions and fees) generated from each. Depending on the complexion of your agency, these accounts might be $30,000 or $40,000 revenue accounts or more - or they may be $3,000
WISCONSIN INDEPENDENT AGENT
or $4,000 revenue or less. It doesn’t matter. What matters is to know how many accounts compile what part of your total commercial lines writings in order to determine your agency’s volatility. What happens if five accounts bring you 70% of your commissions and you lose two or more of them in one year? What happens if 25 accounts bring you 40% of your commissions and you lose two or three of them? It may hurt, but it will less likely put you out of business in the second example than in the first. Your listing will likely look like this (there is no minimum or maximum number of accounts. The guideline is to use all accounts that generate over 1% of your commercial lines income as part of the list.
This information will tell you whether you are heavy in one or a few specific industries or are a generalist. It will give you specific information about your average size of accounts including and excluding your Top Accounts. It will tell you how much volatility you experience and permit you to market toward or away from accounts of specific sizes or industries in the next year. These are only two of the 40 questions we ask in our GPP Analysis Questionnaire as we analyze our clients’ agencies and those of agencies that they wish to acquire or with which they desire to merge. Each question is designed to analyze another function of the agency’s administrative operation, financial condition or marketing expertise. In our GPP Analysis, the results of these analytics are the recommendations that we make to enhance growth expectations, individual and agency productivity and agency profitability. We have done this continually since 1985, so we can learn in only a few days what some agents take years to understand about their businesses. That’s the benefit of hiring the ‘Pros’ to evaluate and enhance your performance. Many agents have found the GPP Analysis Questionnaire productive for them to use to gain a better insight into the operation of their own businesses. We would be happy to discuss the potential of a GPP Analysis with you or to send you a GPP Analysis Questionnaire for your use (at no cost, of course). Please call David Diamond, Marketing Director, Agency Consulting Group, Inc. at 800-779-2430.
> David Diamond Marketing Director, Agency Consulting Group, Inc. at 800-779-2430.
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
WISCONSIN INDEPENDENT AGENT
JUNE 2018 | 13
SALES
DIFFERENTIATING SELLING FROM CONSULTING Many Agency Consulting Group clients and PIPELINE readers are aware that some of my recreational activities involve ocean cruising. We have been to many parts of the world and we enjoy the experience as much as the destinations. It re-charge my batteries with respect to the definition of what WE do for you as consultants AND what you do for your clients as their agents. We compare and contrast different experiences through the eyes of a consumer to determine what we feel defines GREAT SERVICE for the recreational experience on our free time AND for the comparison of service requirement that you customers expect, desire and find thrilling about dealing with you as an independent agent. This trip we were with 40 professional travel agents who were mixing business with pleasure, taking courses while on board to better familiarize them with the class of ship on which we were sailing. Within a few days I realized that the Travel Consultants (their choice of a more suitable term for what they did instead of Travel Agent) and our own independent insurance agents shared much more than they diverged in their methods of operation and in both in their successes and frustrations striving to get more clients to believe in and use their services. This is why we strongly recommend that your insurance professionals be called Insurance Consultants instead of simply Agents or certainly instead of “Producers”. Here are some of the commonalities and how they can be used to your advantage to build the client base for you and for your agencies: Neither are in the business of “selling” anything - the successful participants in both use their vast base of knowledge to tailor the experience of travelling and/or achieving insurance programs to the specific conditions, needs and desires of the client facing them. Clients purchasing the services of the consultant is a natural by-product. It was shocking how closely the travel agents’ problems and frustrations compared to our own in the insurance industry. The bane of their existence and their biggest time waster is the traveler who thinks that all travel is alike and the only difference is the price point (sound familiar?). They, like us, assume that among the millions of price-driven shoppers that more than a few exist who can be made to understand that YOU ALWAYS GET WHAT YOU PAY FOR. Story after story arose about travelers who found themselves in an unfamiliar place with a language they didn’t know facing incorrect
14 | JUNE 2018
accommodations, travel issues or service issues that couldn’t be resolved because, in great part, they had no personal representation dedicated to making their experience exactly what they desired. How close is that to our belief that competent personal relationships between client and agent is critical to the customer achieving the correct types and levels of protection for their particular risks and risk tolerance? A professional travel consultant, like a professional insurance consultant are most valuable by knowing the individual client well and treating every prospect as if they were already a trusting customer until and unless they prove otherwise. The experienced professional travel consultant and the experienced professional insurance consultant use their histories with people to gauge the level of trust of their prospects and customers and avoid being USED (and abused) by those who wish to glean your knowledge and experience only to book the travel or write the insurance through who they believe are lower priced brands. What these short-sighted people don’t understand is that the knowledge that allows you to identify which staterooms they should get on a ship or which coverage and specific insurance carrier is most appropriate for them is only the first step toward the customer achieving their goal, whether it is for recreation or protection. Both travel consultants and insurance consultants are in the business of probing to identify the customer’s real goals, desires and objectives and fulfilling them. The reason people need help in planning their protective devices and in planning their vacation is similar. They don’t know what they don’t know! I know that insurance is required by financial institutions by some government authorities and by the common sense that tells me that I can’t afford to cover my own risk. I HOPE that I won’t need my insurance coverage but if I don’t then I feel somewhat bad about paying for renewals every year when I can always use that money for other personal or business objectives. Our goal as the insurance consultant is to identify the risks to that customer’s assets, educate the customer so he feels comfortable and secure in the coverage’s that are in his protection package and reminding him that the insurance costs are an WISCONSIN INDEPENDENT AGENT
SALES
investment against a serious financial risk in case of loss. Similarly, when I want to see the world or to travel of other reasons I know I’m committing some of my disposable assets to that goal. After all, no one (of whom I’m aware) can take it with them and I’ve seen no gravestones that read “He Died a Wealthy Man”. Whether It’s $100 or $100,000, we all build some part of our asset base to bring pleasure and interest into our lives - otherwise we don’t have careers - we have life sentences. Whether I know where I want to go or not, I need someone who knows the travel industry to turn my focused or fuzzy goals into realities - and cost is only a measure of the reasonability of my expectation. If I only have $1,000 to spend a good travel consultant will quickly make me realize that a trip to Australia and the South Pacific might be a little out of range. If I need to protect my home, my vehicles, my business, my other assets and the lives and health of my family I need someone to help me determine what protective devices are needed for all my assets, the costs for each and any ways of ameliorating those costs, if necessary, with fair judgement of the additional risks I take to save some money (i.e. higher deductibles). So, whether travel or insurance, my consultant helps me tailor my program to my needs, desires and to my pocketbook. Unfortunately, 90% of the travel agents out there AND 90% OF THE INSURANCE AGENTS OUT THERE stop at the point of sale and fail to take the steps that will guarantee a Customer for Life to either of them. The continued service by a professional consultant in either the travel business or in the insurance business makes the difference between SELLING travel or insurance services and PROTECTING THE CUSTOMER in both scenarios. I have a Travel Consultant. He works for a large, internationally known travel firm but he really works for me and, I’m sure, all of his other customers feel exactly the same way. When we plan my recreational (or business) travel he analyzes my goals and needs and then sets to work finding me what meets my goals AND a ton of alternatives because he knows that I may alter my goals if he shows me other possibilities that may make my experience more fulfilling. We all wish we had an insurance consultant who does the same for our risk analysis instead of asking for our current policies to quote against. Then my travel consultant continues to review alternatives even after booking my travel itinerary in case something changes in my favor before my trip. Most of the time that’s not necessary in a regulated industry like ours. WISCONSIN INDEPENDENT AGENT
But, most importantly, my travel consultant continues his service during and after my trip to give me assurance that someone is there if something goes wrong and to evaluate my experience in preparation for the next trip. Here’s where most insurance agents go wrong. Our carriers would like us uninvolved in the claims process. It is more efficient for the insured to report the claim directly and let the claim department analyze and settle the claim (from the carrier’s standpoint). But I’ve had a recent claim (sewer backup) and I’ve had almost a half a century of insurance experience. I assure you there is a completely different perspective from a claimant’s standpoint than from a policy buyer’s standpoint. My (soon to be) former agent’s participation was to tell me to call the Carrier if I had any questions. The carrier did not care if I had 50 or 500 years of insurance experience - their procedures and guidelines dictated what they were willing to do or to pay regardless of how the contract read. I could arbitrate or take legal action but, as a simple policyholder I had few alternatives. As an agent I stood with my clients and considered it my job to act as intermediary and “translator” between the carrier and my client. No, I didn’t and couldn’t make uncovered losses covered. But I could (and did) intervene with the claims department, as needed, and tell my client his options - after all, they don’t actually READ the contract - they take our word for it that they are properly covered. So, like the professional travel consultant and the professional insurance consultant, I acted to support my client while supporting my carriers. I sold insurance on behalf of my carriers but I supported my clients in their most stressful times of need as their insurance consultant. The point of this article is to treat every prospect as if they were your mother. Take the time to learn their needs, wants and asset risks. Assume that they will buy insurance from you if you take proper care of them. As soon as they show you that they are not going to be your customer stop giving away your vast store of knowledge - but invite them to return to you if they decide to take your advice (including buying their insurance through you to allow you to make your living). Then, as they become your clients - DON’T FORGET ABOUT THEM! Pay as much attention to every client as that client needs and desires (not a pre-determined set contact). Some will want to speak to you regularly and others will not. And be there for them as their lives change and especially if they have to USE the insurance that you recommended through a claim. The client builds confidence in you during the sales process but they become your greatest cheering section when you are there for them in the trying times. The insurance industry and the travel industry is different but the relationship we build with our clients are the same. The more you know them, the more they trust you. Be a professional insurance consultant. You will gain many more clients that way and you will never have to cold call or solicit again. >B rent Kelly is an executive coach and speaker with the Sitkins Group. He helps agencies define a clear path to sell more, retain more, and earn more through the “ProFit Experience.” Contact Brent at brent@sitkins.com or learn more about the programs Sitkins Group offers at www.sitkins.com.
JUNE 2018 | 15
COMMENTARY FROM COUNSEL
SUPREME COURT PERMITS EMPLOYMENT CLAIMS
ARBITRATION AND CLASS ACTION WAIVERS
Employment-related class action lawsuits—perhaps your agency has clients who have been involved in them as defendants or, if your agency operations are large enough, it may have been a defendant in one as well. These suits vary in substance and scope and can be devastating to an employerdefendant. A number of years ago, to combat this risk, many employers began requiring employees to sign arbitration agreements including class and collective action waivers. The enforceability of such arbitration agreements has varied around the country, depending on which jurisdiction was analyzing them. However, on May 21, 2018, the U.S. Supreme Court ruled in Epic Systems Corp. v. Lewis that employees can agree to: (1) arbitrate employment disputes; and (2) waive their right to resolve those disputes through class and collective actions. While this decision represents a significant victory for employers and may limit an employer’s financial exposure in employment disputes, the opportunity it presents has to be given careful consideration.
On appeal, the Seventh Circuit Court of Appeals agreed with the district court, becoming the first appellate court to agree with the National Labor Relations Board’s (NLRB) 2012 position that such waivers were unenforceable. As a result, employers in Wisconsin, Indiana and Illinois have been bound by this ruling since 2016.
binding on future litigants. This means that an employer could find itself arbitrating the same case over and over again (e.g., donning/ doffing cases) with differing outcomes. Some plaintiffs’ attorneys also have resorted to filing a large number of individual arbitrations to make the arbitration process exorbitantly expensive for employers.
The Supreme Court, in a 5-4 opinion authored by Justice Neil Gorsuch, overturned the Seventh Circuit and ruled that the NLRA did not grant employees a right to class or collective actions, nor did the waiver of class rights violate any provision of the NLRA. According to the Court, the NLRA does not address class/collective action issues. Instead, the NLRA focuses on collective bargaining issues. In short, the Court gave its approval to arbitration agreements that require resolution of employment disputes on an individual basis.
Employers considering an arbitration clause should also evaluate the scope of the provision. Given the costs associated with arbitration, some employers may want to limit an arbitration program to just wage and hour claims, which have the greatest likelihood of being brought as class claims. The issues of whether Title VII and other discrimination claims should be limited to arbitration is an additional consideration. Federal and state legislators have also made some noise regarding implementing laws that prohibit mandatory arbitration of sexual harassment and other Title VII claims. A related limitation to be mindful of is that, even with arbitration agreements and class waivers, employees must remain free to file administrative charges, and lawsuits initiated by the EEOC or DOL would be unaffected by arbitration agreements with class waivers.
The Epic Case and Decision Epic Systems required its employees to sign an arbitration agreement that included a class and collective action waiver. By virtue of that agreement, employees who signed it agreed to resolve their employment disputes through individual arbitration and also waived their right to participate in or receive benefit from any class, collective or representative proceedings. A former Epic employee who signed such an agreement filed a class/collective action against Epic, claiming he and other Epic employees had been denied overtime wages in violation of the Fair Labor Standards Act (FLSA) and Wisconsin wage and hour laws. Epic moved to dismiss the claim and to compel arbitration, citing the arbitration/class waiver agreement. The district court denied Epic’s motions, stating that the waiver was unenforceable because it interfered with employees’ right to engage in “concerted activities” for “mutual aid or protection” under the National Labor Relations Act (NLRA). WISCONSIN INDEPENDENT AGENT
Now What? Employers now have class action waivers at their disposal—but what does that mean? Employers that do not have arbitration agreements should consider whether arbitration makes sense for them. There are many benefits to arbitration, including quicker resolution of claims, more predictable outcomes compared to a jury, potentially lower attorneys’ fees to take a case through completion in individual arbitration than in court, and a greater chance of keeping the proceedings and outcome confidential. The existence of an arbitration clause may also serve as a deterrent to pursuing any form of claim against an employer. There also are potential downsides to arbitration. Fees associated with arbitration can be just as significant as in-court litigation, and in states like California and with certain dispute resolution agencies, the employer must pay all of the arbitrator fees. In addition, arbitration decisions are not
Conclusion Employers who currently use arbitration agreements with their employees should consult with legal counsel to ensure those agreements meet their needs. For employers who do not currently use such agreements, the Epic decision provides a perfect opportunity to implement such agreements. Before making changes to existing agreements, relying on such agreements going forward or implementing new agreements, employers should consult with legal counsel to discuss the potential benefits and drawbacks of arbitrating employment disputes. > J osh Johanningmeier IIAW Legal Counsel
JUNE 2018 | 17
EMPLOYEE BENEFITS
EMPLOYERS ARE ACCELERATING ADOPTION OF BENEFITS TECHNOLOGY TO MEET THE NEEDS OF TOMORROW’S WORKPLACE Since 2012, investors have steered more than $14 billion into human capital management (HCM) software and platforms. A new study by The Guardian Life Insurance Company of America® (Guardian) confirms that human resources technology is top of mind for many employers seeking greater efficiencies and workforce engagement. The study reveals most employers have increased their spending on benefits-related technology in the past five years, with approximately 50 percent expecting further increases in the next three years. The latest set of findings come from The Fifth Annual Guardian Workplace Benefits StudySM, Game-Changer: The Digitalization of Employee Benefits Delivery. Workplace demographic shifts, particularly millennials, whose share of the workforce continues to expand, are influencing how employers manage human resources and employee benefit functions. Millennials prefer a more intuitive, personalized and engaging benefits experience from their companies. The study finds employers are beginning to improve the end-to-end user experience with 75 percent focused on improving effectiveness of self-service platforms, compared to 61 percent in 2014. When asked about helping employees make better benefits solutions, 73 percent of employers said this was “highly important” compared to 47 percent in 2014. “Our lives increasingly revolve around new technologies and digitalization, and this study confirms that benefits technology is reshaping how employers think about their benefits strategy,” said Marc Costantini, executive vice president, Commercial and Government Markets, at Guardian. “A multi-generational workforce along with mounting pressures on employers to contain costs, simplify their benefits, and stay compliant are prompting employers to make this a priority.”
Employers Need Help Navigating their Options The study also reinforced that most employers need expert advice when it comes to benefits technology options. The wide range of selections creates confusion about which vendor to go with and what capabilities will best fit their needs. This was prevalent among small companies (i.e. 5 to 24 employees) with nearly 40 percent saying that developing a benefits technology strategy is a significant challenge. However, for employers who use brokers, two in five indicate they have not spoken to a broker about their benefit technology needs. Other key findings in the study include: • Three in four millennials wish it were easier to learn about and access their workplace benefits • Forty two percent of young millennials use artificial intelligence to find answers for benefits of health-related questions compared to 26 percent of baby boomers • Fifty eight percent of employers say managing their employee benefits has become increasingly complex – up from 52 percent in 2015 • Sixty seven percent of highly digital employers said enrolling employees is “very efficient” compared to 44 percent of paperbased employers
Benefits Technology is a Strategic Imperative C-suite executives are also turning their focus on digital HCM functions for cost-savings and more efficient strategies. More than 40 percent of all employers say that expanding their use of technology will be among their top benefit strategies in the next five years. The rise of SaaS models has enabled businesses of all sizes to gain more access to affordable cloud-based applications for handling HCM. The study finds one-third of smaller businesses (i.e. 5 to 24 employees) plan to introduce changes by 2020.
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For more information about Guardian’s workplace benefits or to view a copy of the study, please visit: guardiananytime.com
Methodology The Fifth Annual Workplace Benefits Study was fielded in the Spring of 2017 and consisted of two online surveys: one among 2,000 benefits decision-makers (employers) and another among 1,700 working Americans (employees), allowing us to explore benefits issues from both perspectives.
WISCONSIN INDEPENDENT AGENT
We look for the best independent agents and build relationships that last the duration. We are committed to the independent agency system as the only means to deliver our products. Because of that, we work hand-inhand to help our agencies grow profitably.
Our agents set us apart.
to Commercial Insurance that understands the Bar & Tavern Industry At Badger Mutual, we take commercial insurance personally. Visit our website today to quote a customized package of protection for your customers.
For information about becoming a Partners Mutual Insurance Agent please contact Brian Martin at 262.432.3439 or Mike Ottman at 262.432.3418.
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BE WORRY FREE WITH IMT
We understand the importance of partnerships and take great pride in building strong, stable relationships with our agents and policyholders. Through experienced claims expertise and hightouch customer service, we are there when we are needed most. Learn how you can represent IMT Insurance & Wadena Insurance at imtins.com/contact_us.
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JUNE 2018 | 19
ERRORS & OMMISSIONS
SMART AGENCIES:
KEEPING UP IN THE AGE OF THE ‘INTERNET OF THINGS’ We live in a society increasingly ruled by innovations. The trend towards “smart” technology continues to revolutionize the way people live in smart homes, drive smart cars and interact with each other via social media on their smart phones. This exponential growth in the tech sphere has a whole host of implications for the future of personal lines of insurance. Yet all too often our industry finds itself struggling to keep up. So how should you respond? Simple: smart technology demands smart agencies.
Smart Home: Using innovation to harness insights of a risk We live in the age of the Internet of Things: devices connecting anything with an “on/ off” switch to the internet and/or each other. We see home alarm systems, light switches, security cameras and thermostats being controlled remotely via a smartphone or tablet. Having this level of connectivity means data is available in real time about the condition and inner-workings of a remote location. But perhaps this is just another tech gadget that will come and go before we know it. Don’t bet on it. Far from being a passing craze, it is expected that there will only be a rise in these connections and available data. Cisco projects there will be over 50 billion connected devices in the world by 2020. This means the future of smart homes gives rise to a unique opportunity for underwriting with a continuous stream of data. This data is useful for the homeowner as it provides conveniences in facilitating the mundane tasks of everyday life but can also be an invaluable tool for insurers in assessing a real property risk. The future of smart home technology includes a class of products known as “Home
Wellness Alerts”. These alerts provide a wealth of in depth knowledge that would be almost impossible to collect otherwise. Alerts that are classified as loss control mechanisms give information on the condition of a property, but they can also be used to predict future risk. They communicate in real time to the property owner and authorities to lessen the damage of a covered peril -- or prevent the loss altogether. Some examples of the Home Wellness Alerts being tested in the marketplace: • Water leak protection: sensors that detect water leaks in the home • Theft protection: motion sensors, biometric for security (retina scans, facial recognition, fingerprints) • Ground Sensors: alert property owners of shifts in the ground that may indicate mudslides or earthquakes • Fortified Homes: advances in engineered product to make homes resistant to hail, high winds and hurricanes
Leverage transformative technology The insurance industry is responding to the perils of smart phone and tablets but does not always embrace their benefits. Those same devices that are potential distractions can become invaluable sales tools and policy servicing mechanisms. Harvesting data from the Internet of Things via connected smart
cars, tablets, smart phones, smart homes, and (semi) autonomous vehicles can exponentially improve on traditional rating factors such as credit, loss history, predicting future risk -- even the handling of claims. The great news is that all this information and much more is readily available via the Internet of Things. The bad news is that insurers and agents are nearly always late adopters of technology, so this data is not being harnessed. Infrastructure in the insurance industry is often lacking when it comes to advances in technology. This lack of technological infrastructure leads to lack of visibility and awareness which leaves a panacea of potential loss circumstances looming unassessed. Lack of transparency to these perils may limit the ability of agencies to fully and adequately advise and insure clients. This gap is one that may give rise to an E&O claim against an agency. Agents must be diligent in preparing themselves for the new wave of smart technology. Strategic partnerships that focus on the use of technology and innovations are a must in the modern underwriting environment. It is incumbent on the industry as a whole to “get smart” because in this sense tomorrow is already here. And you should know by now the alternative to embracing your future. You’re history. > L arrye Murrell is an assistant vice president, claims specialist with Swiss Re Corporate Solutions and works out of the office in Overland Park, Kansas. Insurance products underwritten by Westport Insurance Corporation, Overland Park, Kansas, a member of Swiss Re Corporate Solutions.
This article is intended to be used for general informational purposes only and is not to be relied upon or used for any particular purpose. Swiss Re shall not be held responsible in any way for, and specifically disclaims any liability arising out of or in any way connected to, reliance on or use of any of the information contained or referenced in this article. The information contained or referenced in this article is not intended to constitute and should not be considered legal, accounting or professional advice, nor shall it serve as a substitute for the recipient obtaining such advice. The views expressed in this article do not necessarily represent the views of the Swiss Re Group (“Swiss Re”) and/or its subsidiaries and/or management and/or shareholders.
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WISCONSIN INDEPENDENT AGENT
“Keystone is for people who believe that powerful partnerships generate prosperity.” Elizabeth Schenk Vice President of Sales & Geographic Expansion
At Keystone, we provide you with the resources and expertise to meet the needs of your clients and grow your agency. We take a consultative approach and develop partnerships based on shared goals and mutual interests. Partnering with us provides you with the tools you need for unified stability and strength in an ever-changing industry. Because independence works better together.
Coming to Wisconsin June 2018 CONTACT FOR MORE INFORMATION: Elizabeth Schenk 888.892.5905 | eschenk@keystoneinsgrp.com ©2017 Keystone Insurers Group ® All rights reserved. This does not constitute an offer to sell a franchise in any state in which the Keystone Insurers Group franchise is not registered.
INDUSTRY NEWS
NOTICE TO YOUR UIM CARRIER FOUR YEARS AFTER THE ACCIDENT? NO PROBLEM
When do you have to give notice to your underinsured motorist (UIM) carrier—right after the accident occurs, or only when it becomes clear that the tortfeasor’s policy limit will be insufficient to make you whole? That was the fundamental question at stake in Shugarts v. Mohr, 2018 WI 27, a case recently decided by the Wisconsin Supreme Court. Based upon the language of the UIM policy at issue and applicable Wisconsin statutes, the Court concluded, in a unanimous decision, that notice is required upon tender of the tortfeasor’s underlying policy limit, and no earlier. That meant, in this case, that the first notice to the UIM carrier, which came more than four years after the accident, was timely and that there was no need to look into whether the carrier was prejudiced by the delay.
THE FACTS On Oct. 11, 2000, an Eau Claire County deputy sheriff, Shugarts, gave chase to a suspect, Mohr. Unfortunately, Mohr’s vehicle struck Shugarts’ squad car, severely injuring him. Shugarts hired counsel, who sent notice of retainer to Mohr’s auto insurance carrier, Progressive, in late 2011. Progressive denied coverage, on the grounds that Mohr’s striking of the squad car was an intentional act. Years went by, settlement efforts did not succeed, and Shugarts ultimately filed suit against Progressive in mid-2013. Finally, in mid-October 2014, nearly four years to the day after the accident, Progressive offered to pay its policy limit of $50,000. Several weeks later, Shugarts’ attorney sent notice of retainer to Allstate, Shugarts’ UIM insurer. Four months after that, the attorney followed it up with a more detailed notice, sharing Progressive’s limits offer and explaining that Shugarts’ claim was well in excess of that limit.
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In short order thereafter, Shugarts added Allstate as a defendant in the lawsuit. Not surprisingly, Allstate raised untimeliness as a defense and moved for summary judgment. The Eau Claire County Circuit Court granted the motion and the court of appeals affirmed.
and within one year after it was required by the policy,” that section did not apply because the policy at issue did not require “proof of loss” for UIM claims, only proof of “claim.” In other words, because the policy did not require proof of loss, the statute could not impose a requirement that was not in the policy itself.
THE POLICY The Court looked first at the applicable Allstate policy. That policy had seven separate coverage parts, with the two critical ones being “Automobile Liability Insurance” and “Underinsured Motorists Insurance.” The Automobile Liability Insurance section included a provision requiring the insured to notify Allstate “of all details” of an “auto accident” “as soon as reasonably possible.” The Underinsured Motorists Insurance section, however, said nothing about notice of an “accident.” Instead, it only required the insured to submit notice of “claim” “as soon as possible.” According to the Court, Shugarts did not have a UIM “claim” until Progressive tendered its underlying policy limit. Because that did not occur until mid-October 2014, and Shugarts’ attorney promptly communicated with Allstate thereafter, the notice was timely. In the Court’s view, the Allstate policy did not require notice of an accident, only notice of claim, and the notice of claim was timely. The Court also addressed Allstate’s argument that Wis. Stat. § 631.81 required Shugarts to provide notice earlier. Rejecting Allstate’s contention, the Court noted that while section 631.81 requires “notice or proof of loss” to be furnished “as soon as reasonably possible
THE UPSHOT The Court’s decision puts UIM carriers in a tough spot. The purpose of a notice provision is to allow insurers to investigate while the evidence is fresh. If a carrier does not even find out about an accident until four years after it happened, however, it will be rather difficult to explore the situation and preserve the key evidence. One can easily imagine situations where the delay will prejudice the insurer. To the extent they wish, insurers can probably solve the problem by revising the language in their UIM policies. For example, insurance companies could take the notice of accident language from the liability sections of their policies and insert the essence of it into the UIM sections. Perhaps that would inundate carriers with too many unwanted notices in situations where the UIM coverage is never likely to come into play, but that seems like a small price to pay for the cases in which having early notice and an early opportunity to investigate will help to efficiently and effectively resolve the claim.
>K endall Harrison is a commercial litigator for Godfrey & Kahn and regularly handles insurance, reinsurance and class action matters. WISCONSIN INDEPENDENT AGENT
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VIRTUAL UNIVERSITY
ALTERNATIVES TO BUSINESS INCOME COINSURANCE For some unknown reason, many agents are scared of business income coinsurance. This concept should hold no fear after an earlier VU webinar on this topic. But for those still skittish about estimating coinsurance for a business income policy, there are the three alternatives to coinsurance in the business income policy.
These are: > Business Income Agreed Value; > Monthly Limit of Indemnity; and > Maximum Period of Indemnity.
Business Income Agreed Value Business income agreed value suspends the coinsurance condition for 12 months. Qualifying for agreed value protection still re-quires the insured to complete the Business Income Report/Worksheet (CP 15 15) at the beginning of the policy period and every year thereafter. If an updated worksheet is not completed annually, the policy reverts back to a coinsurance form with all its applicable penalties; so, this is not the best option if the insured (or the agent) is trying to avoid the worksheet. Not only is the insured required to complete the worksheet, but an officer or other responsible party must also sign and attest to the information on the worksheet specifying: 1) the value the insured has agreed to carry; and 2) the desired coinsurance percentage. Agreed value signifies that the insured and the underwriter agree upfront on the amount of insurable business income subject to loss. The insured agrees to carry that predetermined amount of coverage. In return, the underwriter agrees to pay the entire business income loss up to that limit without the application or consideration of coinsurance.
Monthly Limit of Indemnity This option to traditional coinsurancebased coverage allows the insured to avoid coinsurance completely and sidestep the requirement of completing a business income report/worksheet. There is no real upfront calculation associated with this option. The only calculation done is at the time of the loss, to decipher the maximum limit available during any one 30-day period. Two decisions are required of the insured when this option is chosen: 1) the limit of coverage; and 2) the monthly limit of indemnity coverage fraction. No “formal” income calculations are done, so the limit is little more than a guess made by the insured. The second decision requires the insured to choose from among the three available monthly limit fractions: one-third (1/3), one-
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fourth (1/4), and one-sixth (1/6). The monthly limit fraction serves to cap the amount of coverage available in any 30day period. The chosen amount of coverage is multiplied by the fraction to arrive at the maximum payout during each 30-day period. For instance, if the insured purchases $300,000 of coverage, the maximum amount available in any 30-day period is: • 1/3 monthly limit = $100,000 maximum available for each 30-day period; • 1/4 monthly limit = $75,000 maximum available for each 30-day period; and • 1/6 monthly limit = $50,000 maximum available for each 30-day period. One myth surrounding the Monthly Limit of Indemnity option is the function of the denominator in claims settlement and payout. Some believe, and even teach, that the denominator (the bottom number) limits the number of months the insured gets paid. That is, if the insured chooses a 1/3-monthly limit of indemnity, coverage is only provided for three months. This is fully and completely false - unless the limits are completely used in the first three months. The denominator serves no other purpose than to limit the amount the insured can receive in any one 30-day period. Continuing with the above example, if the insured chooses the 1/3 monthly limit of indemnity, it has up to $100,000 available for any 30-day period during the period of restoration. Business income loss payments continue until the insured uses up the full $300,000 or returns to full operational capability, whichever comes first. If it takes six months to use up the entire $300,000, that’s how long the policy pays. Monthly limit of indemnity, contrary to its name, is actually a non-indemnity option, meaning that the amount of coverage has no real or known relationship to the insured’s business income exposure or estimated period of restoration. As such, the insured is entitled to receive the entire amount regardless of how long it takes. Again, the only two limitations are: 1) the monthly limit (as decided by
the fraction); and 2) a return to operational capability before the limits are completely used. If coverage is provided using the CP 00 30 (Business Income (and Extra Expense) Coverage Form), it is important to remember that the fraction does not apply to the extra expense coverage. However, the amount needed to cover any extra expense must be added to the business income limit purchased. For example, if the insured wants $300,000 business income (BI) coverage and $120,000 extra expense (EE) coverage, it should purchase $420,000 in total protection. The maximum payout is limited to $420,000, but the amount available for extra expense in any one month is not limited by the fractional amount. If the 30-day BI amount exceeds the fractional limit, the entire extra expense loss is still paid. This payout process continues until the total of both BI and EE losses reaches the limit purchased.
Maximum Period of Indemnity The last and simplest of the non-coinsurance options is the maximum period of indemnity. This option limits business income and extra expense payments to the shortest of 120 days, until the limit is spent, or the insured returns to operational capability. Like the monthly limit of indemnity, the amount of business income purchased is little more than a guess. This is a good option only if there is absolutely no question that the insured can return to operational capability within 120 days. Maximum period of indemnity is a nonindemnity option. Like the monthly limit of indemnity option, the limit of coverage is not based on the actual exposure. Unlike the monthly limit option, coverage is limited to a specific number of days. If the insured does not use the entire limit during the 120-day period, the insured is simply out of luck (to some extent as he still had his business income exposure paid during the 120 days). Of the three non-coinsurance options, the maximum period of indemnity option carries the highest rate. Of course, the higher rate is somewhat offset by the lower limits likely purchased. > Chris Boggs Executive Director Virtual University WISCONSIN INDEPENDENT AGENT
WHY ASK THE UNDERWRITER Agents, even very seasoned agents, faced with unique (or even commonplace) loss exposures look to “standard” coverage forms to find coverage or verify that an endorsement is needed. Coverage forms, being legal documents, aren’t always obvious in granting or excluding protection.
Yes, many types of losses are unquestionably covered in the policy, and many are undoubtedly excluded; but there are always gray areas where the specifics of the situation and/or the adjuster’s interpretation of the form may find for or against coverage. Most of these coverage gray areas seem to live within exception wording. When there is an exception to an exclusion, there is coverage - maybe. Insurance policies are notorious for excluding losses and then adding an exception to the exclusion. This is actually the most efficient method for controlling the breadth of coverage, but it is terribly inefficient from a coverage analysis perspective. First the policy excludes an event, then it turns around and inserts the word
“however” (the most dangerous word in an insurance policy) to give coverage back – in a lesser degree. This methodology is applied in nearly every type of insurance policy. Because coverage exists in the exception, the confusion is found in understanding what activities, actions or incidents fall within the scope of the exception. Agents compare the coverage granted by the exception with the reality of the insured’s exposure to find coverage, or as part of the reasoning for recommending an endorsement. When faced with this question of coverage, agents often decide to ask the underwriter to interpret the policy and advise whether coverage exists under the coverage form. Why ask the underwriter? First, the idea that asking the underwriter and getting a written response somehow changes the policy is absurd. The underwriter’s interpretation in no way alters the application of the policy language. Absent an endorsement issued by the insurer, the policy is not changed by an underwriter’s email, letter, memo, pledge of loyalty, etc. This also resolutely ignores the well-settled parol evidence doctrine applied to most contracts. In other words, presenting the claim department an email/ letter from an underwriter which contradicts the plain meaning of the policy or the interpreted meaning will not be considered, unless the insurer, as an ethical matter, feels they should honor that representation, regardless of how bizarre. (This rarely, if ever, happens today.)
Second, an underwriter’s interpretation of standard Insurance Services Office (ISO) policy wording, for which the underwriter has not had any input in drafting, is meaningless. What makes anyone believe the underwriter has any insight into the meaning of the provision, exclusion, etc.? This presumption borders on reckless. Third, underwriters do not make coverage determinations, adjusters do. In fact, an underwriter’s job is not coverage interpretation and asking them to make such a determination is unfair. An exception may be a specialized manuscript policy/endorsement drafted by the underwriter. Claims adjusters make coverage determinations and rarely, if ever, consult with underwriters. And frankly, if the coverage is in question, not even the adjusters make the coverage determination – they rely on coverage counsel – either internal or external. Why ask the underwriter? Their opinion generally carries little weight when a claim occurs. Asking the underwriter and getting a written response guarantees nothing and creates a false sense of security. But without the underwriter’s opinion, agents may be on their own because most claims adjusters are going to answer the coverage question with, “It depends.” And, in fact, they are right. An agent’s job is to analyze exposures, compare those exposures to the policy, and make coverage recommendations where necessary and appropriate. When working with an exception, understand (and explain) that the activity may or may not fall within the exception, and thus be covered, but that as the specifics change so might the availability of coverage. Then offer the necessary endorsement that removes the doubt. The insured must then make a business decision. Underwriters were hired to decide which risks the carrier should take, not to decide if coverage applies. So again, why ask the underwriter.
The Virtual University is a Big “I” members-only resource. Many articles are based on real-life questions received by the Ask an Expert service. This service ensures that the information is current and topical. Go to www.independentagent. com/Education/VU/. You will need to login with your IIABA username and password before using the VU. The IIABA does not assume and has no responsibility for liability or damage which may result from the use of any of this information. WISCONSIN INDEPENDENT AGENT
JUNE 2018 | 25
2018 PRE-LICENSING CLASS SCHEDULE Conducted at State Association Headquarters, IIAW pre-licensing classes fulfill the study requirements for life, health, property and casualty. Full course materials — not just an outline — are included with registration. The classes are:
REGISTER AT IIAW.COM 2018 CLASS DATES
LIFE & ACCIDENT/HEALTH January 8-11 February 5-8 March 5-8 April 9-12 May 14-17 June 4-7 July 9-12
PROPERTY & CASUALTY
January 22-25 February 12-15 March 19-22 April 23-26 May 21-24 June 18-21 July 23-26
August 6-9 September 10-13 October 8-11 November 5-8
September 24-27
December 3-6
December 17-20
August 20-23 October 22-25 November 12-15
Designed to help you pass your state licensing examination. The quickest way to meet the Wisconsin 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 Commissioner of Insurance.
IIAW MEMBER PRICING: $340 - Pricing given for full class registrations.
NON-MEMBER PRICING: $355
You may also take individual classes.
DAILY SCHEDULE
Life & Accident/Health
Day 1 (Monday) 8:30 a.m. - 4:00 p.m. ($85) SECTION A: Principles of Insurance & General WI Ins. Law Ethics Day 2 (Tuesday) 8:30 a.m. - 4:00 p.m. ($90) SECTION B: Life Policies, Terms & Concepts Day 3 (Wednesday a.m.) 8:30 - 11:30 a.m. ($45) SECTION B: Life Policies, cont. & WI Life Insurance Law Day 3 (Wednesday p.m.) Noon - 4:00 p.m. ($45) SECTION B: Accident & Health Policies, Terms & Concepts Day 4 (Thursday) 8:30 a.m. - 4:00 p.m. ($90) SECTION B: Accident & Health, cont. & WI Health Insurance Law
Property & Casualty
Day 1 (Monday) 8:30 a.m. - 4:00 p.m. ($85) SECTION A: Principles of Insurance & General WI Ins. Law Ethics Day 2 (Tuesday) 8:30 a.m. - 4:00 p.m. ($90) SECTION B: Property Policies, Terms & Concepts CLASS SITE/DIRECTIONS The IIAW is located at 725 John Nolen Dr. in Madison, WI. Day 3 (Wednesday a.m.) 8:30 - 11:30 a.m. ($45) When traveling south on John Nolen, it’s the last driveway SECTION B: Property Policies, cont. & WI Property Insurance Law Day 3 (Wednesday p.m.) Noon - 4:00 p.m. ($45) before Highway 12/18 (Beltline). Located near the Alliant SECTION B: Casualty Policies, Terms & Concepts Energy Center and Sheraton Hotel. Day 4 (Thursday) 8:30 a.m. - 4:00 p.m. ($90) INCLEMENT WEATHER SECTION B: Casualty Policies, cont. & WI Casualty Insurance Law If weather conditions are questionable, use your own judgment regarding your personal safety. If Madison public Please contact Kathy@IIAW.com for information about schools are closed, the IIAW is closed and pre-licensing is multiple registration discounts. canceled for the day. Canceled classes are made up on The course fee includes all class materials. Materials are Friday. distributed on the first day of class. You receive: HOTEL INFORMATION • The Life & Accident/Health or Prop. & Casualty Insurance Students requiring lodging will receive a special rate at the Study Manual. Clarion Suites, 2110 Rimrock Rd. in Madison. Please call • The Intermediary’s Guide to Wisconsin Insurance Law. the hotel directly at 608.284.1234, and ask for the • The State of Wisconsin Ins. Licensing Candidate Handbook. independent insurance agent’s discount. This provides all the necessary information to obtain a license.
To register, click the Education tab on IIAW.com. For Wisconsin exam info, visit prometric.com.
RISKY BUSINESS
MAKING PROMISES YOU CAN’T KEEP: E&O EXPOSURES ON AGENCY WEBSITES
If you have attended any of the E&O Risk Management classes I’ve presented lately, you’ve heard me talk about the exposures an agency faces on their website. Most agency owners and employees are not aware of the risk in using certain language to describe their agency and the services they provide. Many haven’t even looked at their website since they created it! In Wisconsin, insurance agents have a duty to provide the insurance requested by an insured because we are considered an “order-taker” state. It is safe to say that the majority, if not all, of our members go above this baseline requirement and provide a higher level of care to their customers. It is also safe to say that many agencies have established a special relationship with customers in one way or another. This is not necessarily a negative aspect of doing business; it can help an agency differentiate itself from the competition. The important part is knowing when and where the special relationship exists and ensuring there are strong E&O risk mitigation strategies in place. Ellen McCarthy is a Vice President and Claim Expert at Swiss Re Corporate Solutions and she recently published an article in the IA Magazine on this subject. Her advice for agencies who are reviewing their websites and marketing materials is to ask: a Could any representations create unrealistic customer expectations? a Does the content make promises the
agency may not be able to fulfill? a Does the agency inadvertently create a heightened standard of care through its written commitments? a Would you want your website statements blown up on a poster board as a trial exhibit? A thorough review of an agency website is a standard part of the Operational Improvement Review offered by IIAW. It can also be done as a standalone service for any agency who has not reviewed their website for E&O exposures. We continue to see E&O claims against our Swiss Re policyholders and there has been an increase in the frequency of plaintiff attorneys referencing an agency’s website or marketing materials to strengthen allegations of negligence. Oftentimes, an agency website is not created by someone who has E&O risk on their mind. Rather, they are trying to entice a prospective customer to do business with the agency. In doing so, they often use language that makes promises or guarantees the agency cannot fulfill. Furthermore, the agency may not have
the internal procedures to feel confident in the fact that every customer is receiving the same level of care. For example, an agency states (as many times they do) that they will “help you understand what coverage you need in a confusing insurance world”, but the agency does not offer proactive coverage suggestions to every account to try to make it better. The most an agency might be doing is offering to review coverage annually by sending a questionnaire but has not had documented contact with that account in years. If this sounds a little too familiar, your agency should absolutely be doing a review of your website and marketing materials – as well as your internal procedures! If you have concerns about your agency website and would like reviewed by an E&O professional, reach out to your partners at IIAW. The difference between stating “We ensure you have the right insurance plan to protect your family or your business” and “Our professional staff can help you select the right coverage for your family or business” can be thousands of dollars and even the future of your agency. > Mallory Cornell is the Director of Risk Management for the Independent Insurance Agents of Wisconsin.
EMERGING LEADER SPOTLIGHT Each month we will be featuring one of the active members of our Emerging Leaders Committee. Our May Emerging Leader is Michelle Jimenez from the John Wickhem Agency in Janesville. Tell us your name and a little more about you: My name is Michell Jimenez and I work for the John Wickhem Agency in Janesville, WI How long have you been on the Emerging Leaders committee? This is my first year on the committee. How did you hear about the Emerging Leaders Committee? I heard about the Emerging Leaders Committee from Derek Wickhem. Why did you choose to become active with the Emerging Leaders committee? I thought it would be a great way to learn more about the insurance industry and to start networking with other professionals. What is your favorite EL event or activity that you’ve done with the EL group? Since I am still new to the group, I have not participated in any events yet. I am looking forward to attending my first Leadership Conference in July. Why should a new agent join the EL committee? It is a great opportunity WISCONSIN INDEPENDENT AGENT
to network, become more social among other agents and learn things from other agents that may benefit you in your career. What is your spirit animal? I would have to say a dolphin. Where is your favorite vacation spot? I haven’t been too many places, but I went to Mexico for the first time last year and really enjoyed it. I am hoping to take another big vacation next year and will possibly be going to Finland and Ireland. Do you have any pets? My cat Bella. She is just over a year old. What is one professional goal for you in the next 3-5 years? To become more knowledgeable in the industry, obtain a leadership role, increase my client base and continue to grow with the company as long as I can.
JUNE 2018 | 27
News Members in the
West Bend Mutual Insurance is a Top Workplace WEST BEND, WI (May 22, 2018) – West Bend Mutual Insurance Company was once again named to this year’s list of the Milwaukee Journal Sentinel’s Top Workplaces which recognizes the best places to work in Southeast Wisconsin. West Bend was ranked number four in the large company category. This is the seventh consecutive year in which West Bend has placed in the top four. The company was also honored in the Top Workplaces Hall of Fame for making the list eight of the program’s nine years. “The recognition we continue to receive as a top workplace is very meaningful,” said Kevin Steiner, West Bend president and CEO. “Our associates are our greatest asset and we have a responsibility to create a positive workplace. The fact that for the seventh consecutive year our associates have provided the feedback that has earned us a top-four ranking is outstanding. Congratulations to all of our 1,200 associates who work hard to make West Bend Mutual Insurance a special place.” A total of 150 companies were named to the Top Workplaces list in 2018. Other top businesses in the large company category include Kwik Trip Inc., First Weber Inc., and Children’s Hospital of Wisconsin.
R&R Named Small Business Agency of the Year by Delta Dental of Wisconsin For the 2nd consecutive year, Delta Dental announced R&R Insurance Services as ‘Small Business Agency of the Year.’ The award is presented annually to the agency partner that places the most new group dental plans, with less than 50 enrolled employees, in a given year. Both R&R and Delta Dental are mission driven organizations with a passion for building long-term relationships, giving back to those in need, and making a positive impact in the community. In conjunction with the award, Delta Dental provided a $2,000 donation to the Bryon Riesch Paralysis Foundation. As a Foundation held close to the hearts of those at R&R, the gift further instills the value of both companies to make a difference in the lives of others.
Chubb’s New Digital Platform Helps Independent Agents Modernize the Placement and Service of Small Business Insurance Chubb’s new digital platform, the Chubb Small Commercial Marketplace®, is an intuitive digital experience designed to modernize the placement and service of small business insurance. Built for, and with independent agents, the Marketplace makes it easy for agents to quote, issue, and service all of their small business accounts.
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“The Chubb Small Commercial Marketplace is a new, intuitive experience and a major investment in Chubb’s independent agency distribution force,” said Jim Williamson, Division President, Small Commercial Insurance, Chubb North America. “Through the Marketplace, Chubb is enhancing the way small business insurance is being sold and serviced.” The Chubb Small Commercial Marketplace is built with cutting-edge technology that provides an exceptional solution for small business insurance, with: • Multi-line account quote capabilities; • Support for both standard and specialty lines, including business owner’s policy and management and professional liability lines; • Extensive data pre-fill with high rates of straight-throughprocessing; • Immediate access to Chubb underwriters; and, • Online, account-level billing with a pay by credit card option. Chubb Small Commercial Insurance deployed the Marketplace platform to more than 3,000 agencies and 15,000 users over the past several months. Going forward, Chubb will look to further expand the capabilities and user experience of the Small Commercial Marketplace by broadening industry segments and adding new products, features, and tools based on feedback received from independent agents. “Chubb believes independent agents will continue to be indispensable advisors to small business owners,” Mr. Williamson added. “The Marketplace is a game-changing solution for how small business insurance gets done, and reinforces Chubb’s commitment to helping independent agents grow their business.”
About Chubb Small Commercial Insurance Launched in March 2016, Chubb’s Small Commercial Insurance division leverages superior underwriting expertise and world renowned claims, account services, WISCONSIN INDEPENDENT AGENT
and financial strength to offer solutions for small businesses. Chubb Small Commercial products are available through Chubb’s exclusive network of independent agents and brokers for over 500 segments of business in the following industries: clubs and associations, cultural institutions, financial services, healthcare offices, real estate, retail stores, service businesses, technology, and wholesale businesses.
Acuity Named a Best Employer by ForbesSmart Sensor Deployment to Increase Policyholder Engagement Acuity is named to Forbes America’s Best Mid-Size Employers list. In collaboration with analytics firm Statista, Forbes asked 30,000 people working for U.S. employers to rate their willingness to recommend their own companies on a scale of 0 to 10. Respondents were also asked to name employers that stand out either negatively or positively within their industry. The top 300 mid-size employers—companies with 1,000 to 5,000 employees—are ranked on Forbes’ list. Employees who took part in the survey were not contacted through their employers but, rather, did so on their own through several online access channels. “We are especially proud of being named to the Forbes list because it is a direct result of input from our employees,” said Ben Salzmann, Acuity President and CEO. “This isn’t an award Acuity could decide to apply for—this recognition comes from people feeling so strongly about Acuity that they took the time to share their feelings on their own accord.” This latest recognition adds to Acuity’s ongoing recognition as a great workplace, including being named: • Employer of the Year - Insurance by the Stevie® Awards • A top five “Coolest Offices in the U.S.” from national consulting and software firm PayScale • One of the “15 Offices You’ll Wish You Worked In” by lovemoney.com • A top 50 “Companies That Care” by PEOPLE • A FORTUNE “100 Best Companies to Work For,” including two times as a top three company “Everyone at Acuity can be proud of this recognition because everyone plays a vital role in building a great workplace,” said Joan Ravanelli Miller, Acuity General Counsel and Vice President - Human Resources “We are all committed to being a great employer, not just within the insurance industry, but across all industries and for all our employees.” WISCONSIN INDEPENDENT AGENT
QBE North America Expands The Solution for Builder’s Risk to Offer Integrated Inland Marine Property Coverage for Construction Projects QBE North America, an integrated specialist insurer, today announced the next step in its Inland Marine product expansion — the launch of The Solution for Builder’s Risk, a comprehensive policy offering unique coverages for construction projects. The initiative to continually expand its innovative portfolio demonstrates QBE North America’s distinctive ability to nimbly respond to the evolving market needs of our customers. “Construction projects are often complex and multifaceted with little or no room for error. Protecting risk is crucial to the success of the project,” said David Brooks, VP Underwriting Leader, Inland Marine, QBE North America. “With our new product offering, The Solution for Builder’s Risk, our customers can protect their construction exposures to help keep their multimillion dollar projects on time and on budget,” he added. Key features of this new product include capacity up to $250,000,000, as well as standard and unique additional coverages for the insured’s specific risk, including Utility Service Interruption, Inflation Protection, Business Personal Property, Waterborne Property and Equipment Breakdown Coverage (including Testing). In addition, QBE offers a full range of insurance for Time Element Coverage, including Loss of Business Income, Delay Penalties and Additional Expenses incurred by the insured. The policy will be written by the company’s Inland Marine underwriters on a monoline basis through QBE-appointed producers in the retail and wholesale distribution channels. QBE’s expert underwriters will help build customized insurance programs to fit any size and type of project from new construction to renovations. In addition, QBE’s inhouse, dedicated specialty claims adjustors offer industry specialization, product expertise and a pre- and post-loss commitment to exceptional customer service. “Our latest Inland Marine proprietary product, The Solution for Builder’s Risk, illustrates how we put the customer at the center of everything we do as an integrated specialist insurer,” said Jeff Grange, President, Specialty Insurance, QBE North America. “This new product allows us to expand the customized product suite we offer through our Specialty and P&C businesses to deliver end-to-end risk management solutions to support the construction industry.”
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FOOD FOR THOUGHT
Serving AAA Members, even on two wheels. While you’re out enjoying this year’s ride, here’s a refreshing tip for AAA Members: AAA now offers roadside assistance for bicycles. AAA Bicycle Service is a new benefit with every membership that provides transportation for you and your bicycle if it breaks down on your ride. It’s one more way AAA helps members relax and enjoy the ride!
Learn more today! Contact Leo Plese (630) 328-7076 or lmplese@aaahicago.com AAA Bicycle Service is available in Florida, Georgia, Iowa, Michigan, Minnesota, Nebraska, North Dakota, Tennessee, Wisconsin and portions of Illinois and Indiana. 17-IA-2064A
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7.5x6.5 4c
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We know what it took to build this unique business.
And we know what it takes to protect it. Underwriters who know and understand what coverages are necessary for each unique business. Loss prevention professionals who use a hands-on approach to help develop programs tailored to each specialty business. Claim reps with the expertise and technology to process claims quickly and efficiently. As an Official Supplier of the Silver LiningÂŽ, you and West Bend will find a specialized insurance plan for your valued customers. To find out more, talk to your West Bend underwriter.
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Where do Insurance Agencies go when they need Insurance? ProtectYourAgency.com E&O, Data Breach and EPLI Insurance