wisconsin INDEPENDENT AGENT MAY 2019
Edgewater Hotel, Madison, WI
July 18-19, 2019
© 2019 Society Insurance
Business as usual even when it’s not. Small detail. Big difference. For franchise owners, someone else’s headache can quickly become their own. That contamination loss at the franchise across town? It affects other businesses, too. Society’s franchise endorsement covers lost income and extra expenses due to contamination loss at other franchise locations, which allows owners to focus on protecting their reputation. We’ll also cover updates to franchise standards after a covered loss. So let your customers focus on the things they can control, and we’ll help keep their credibility intact. To discuss an agency appointment, give us a call at 888-5-SOCIETY or visit societyinsurance.com.
wisconsin
INDEPENDENT AGENT MAY 2019
Insurance Bartender. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Government Affairs Hagendorn Defeats Neubauer with Razor Thin Margins For Supreme Court . . . . . 10 Commentary From Counsel DOL Overtime Rulemaking, Redux . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Virtual University When Sweet Fifi Bites. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Virtual University The Insurance Industry’s Opinion of Warren Buffett’s New 3-Page Policy . . . . . . . 17 Risky Business “Vishing”: Add it to the List of Strategies for Cyber Criminals. . . . . . . . . . . . . . . . . 19 Sales Find the goldmine in your existing resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Agency Operations Disaster Guide Before, During and After. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Emerging Leader Spotlight. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Technology A Look Inside Today’s Acord. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Members In The News. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
On The Cover… The newly named Capstone Innovation Session was formally known as the Leadership Conference. Please join IIAW Emerging Leaders at the Edgewater Hotel in Madison on July 18-19. The “Shark Tank” style event is presented by Integrity Insurance. Come and brainstorm and innovate creative solutions to help your agency and business succeed.
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 2018-2019 Executive Committee President............................................................ Jason Bott Robertson-Ryan & Associates - 330 East Kilbourn Ave., Milwaukee, WI 53202 President-Elect............................................. Chris Costakis Avid Risk Solutions- 2501 Parmenter Street, Ste 200A Middleton, WI 53562 Secretary-Treasurer......................................Darrel Zaleski Spectrum Insurance Group, 4233 Southtowne Drive, Eau Claire, WI 5470 Chairwoman of the Board.................................Lise Meyer Meyer Insurance Agency, Inc., P.O. Box 130, Sauk City, WI 53583 State National Director ................................Steve Leitch Leitch Insurance - P.O. Box 85, River Falls, WI 54022 2018-2019 Board of Directors Mike Ansay, Ansay & Associates, 101 East Grand Ave. #11, Port Washington, WI 53704 Nick Arnoldy Marshfield Insurance Agency, Inc., 208 West 5th Street Marshfield, WI 54449 Mike Harrison R&R Insurance Services, Inc., 1581 East Racine Avenue Waukesha, WI 53146 Dan Lau Robertson Ryan & Associates, Inc., 330 East Kilbourn Avenue Milwaukee, WI 53202 Aaron Marsh Marsh Insurance Services, Inc., 11 East Newton Street Rice Lake, WI 54868 Marc Petersen American Advantage - Petersen & Assoc., Inc. 14785 West National Ave. New Berlin, WI 53151 Joanne Lukas Szymaszek Johnson Insurance Services LLC 555 Main Street Racine, WI 53405 Chad Tisonik HNI Risk Services LLC P.O. Box 510187 New Berlin, WI 53151 Pam Utpadel Universal Insurance Advisors, Inc. 100 West Lawrence Street Appleton, WI 54911 WISCONSIN INDEPENDENT AGENT
> A DVERTISERS & INFORMATION
2018-2019 Committee Chairs
AAA.................................................................. 21
Agency Services............................................ Ruth Vorwald Johnson Insurance Services, 7401 144th Ave, Kenosha wi 53142
Acuity............................................................... 31
Automation/Technology................ Cathleen Christensen Hierl Insurance, Inc., Fond du Lac, WI 53937
Badger Mutual.................................................. 19
Emerging Leaders.................................................. Dan Lau Robertson Ryan & Associates, 330 East Kilbourn Ave, Milwaukee, WI 53202
IIAW CE Webinar Calendar ................................ 4
Employee Benefits........................................... Mike Farrell David Insurance Agency, Inc., 1300 South Green Bay Road, Racine, WI 53406
Keystone.......................................................... 13
Government Affairs............................................. Jeff Thiel R&R Insurance Services, Inc., P.O. Box 1610, Waukesha, WI 53187 Industry Relations............................................Janel Bazan Johnson Insurance Services, 525 Junction Road, Madison WI 53517 Membership & Marketing........................ Jamie Durocher Arlington/Roe & Co., 5530 Ryan Road, Houston, MN 55943
Arlington Roe.................................................. 24 IIAW Agency Solutions......................................18 JM Wilson........................................................ 20 Partners............................................................ 9 Prelicensing Schedule....................................... 5 Robertson Ryan.............................................. 27 SECURA........................................................... 32 Society.............................................................. 2 IMT................................................................... 15 West Bend........................................................ 16 Western National...............................................11 West GUARD.................................................... 22 MAY 2019 | 3
CONTINUING
EDUCATION IIAW ONLINE AND ON-SITE CE CLASSES DATE
COURSE
TIME
02 06-09 06 07 09 13 14 14 14 16 20-23 21 22 23 30
An Agent’s Guide to Insuring Nonprofits Prelicensing Life & Health (Onsite May 6-9) 10 Things Every Commercial Lines Agent Ought to Know Additional Insureds and Certificates of Insurance Homeowners Hot Topics ... What You Need to Know Dispelling the Myths of Workers’ Compensation E&O: Roadmap to Policy Analysis - Part One E&O: Roadmap to Policy Analysis - Part Two E&O: Roadmap to Policy Analysis - Part One Insuring Trusts - Protecting Your Client’s Wishes Prelicensing Property & Casualty (Onsite May 20-23) Ethical Dilemmas ... Making the Right Choices It’s Not My Fault, or Is It? - Liability Issues in Personal Lines Policies Life and Health Solutions for Business Challenges Personal Auto Hot Topics ... What You Need to Know
12 PM - 3 PM 8:30AM-4 PM 12 PM - 3 PM 8 AM - 11 AM 12 PM - 3 PM 12 PM - 3 PM 8 AM - 11 AM 12 PM - 3 PM 4 PM - 7 PM 12 PM - 3 PM 8:30AM-4 PM 12 PM - 3 PM 12 PM - 3 PM 8 AM - 11 AM 12 PM - 3 PM
Prelicensing Life & Health (Onsite June 2-6) Insuring Toys and Collectibles Income After Retirement - Where Does the Money Come From? E&O: Roadmap to Policy Analysis - Part One E&O: Roadmap to Policy Analysis - Part Two Business Income - Coverage Analysis through Claims Prelicensing Property & Casualty (Onsite June 17-20) Personal Auto Policy Protecting Your Most Valuable Asset Ethics and Agent Liability Farm Liability Coverages Business Auto Coverages The Dirty Dozen - Twelve Great Commercial Insurance Mysterie Condominiums
8:30AM-4 PM 12 PM - 3 PM 8 AM - 11 AM 8 AM - 11 AM 12 PM - 3 PM 12 PM - 3 PM 8:30AM-4 PM 12 PM - 3 PM 12 PM - 3 PM 12 PM - 3 PM 12 PM - 3 PM 12 PM - 3 PM 8 AM - 11 AM 12 PM - 3 PM
Prelicensing Life & Health (Onsite July 8-11) Commercial Property Coverages - Exploring Key Concepts Prelicensing Property & Casualty (Onsite June 15-18) E&O: Roadmap to Policy Analysis - Part One E&O: Roadmap to Policy Analysis - Part Two Ethics - Walking a Straight Line Businessowners Policy (BOP) ... Planning for the Unexpected Unlocking the Secrets of D&O Insurance Cyber Liability When the Child Becomes the Parent - Aging Parents and Insurance Decisions Top 10 Countdown of Personal Lines Coverages & Current Issues Workers’ Compensation Farm Vehicle and Equipment Coverages Homeowners Hot Topics ... What You Need to Know
8:30AM-4 PM 12 PM - 3 PM 8:30AM-4 PM 8 AM - 11 AM 12 PM - 3 PM 12 PM - 3 PM 12 PM - 3 PM 12 PM - 3 PM 12 PM - 3 PM 8 AM - 11 AM 12 PM - 3 PM 12 PM - 3 PM 8 AM - 11 AM 12 PM - 3 PM
MAY
JUNE
03-06 05 06 11 11 12 17-20 17 18 20 24 25 26 27
JULY
08-11 15 15-18 16 16 18 22 23 24 25 25 29 30 30
TO REGISTER, PLEASE GOS TO IIAW.COM
2019 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 are included with registration. The classes are: • • • • •
Designed to help you pass your state licensing examination The quickest way to meet the WI education hours requirement Taught by experienced insurance professionals who know the business Conducted in a comfortable classroom with free parking Approved by the Office of the Commissioners of Insurance
REGISTER AT IIAW.COM To register, click the Education tab on IIAW.com. For WI exam info, visit Prometric.com. IIAW Member Pricing: $340 Pricing given for full class registration Non-Member Pricing $355 You may also take individual classes Contact Kim@iiaw.com for multi-registration discounts. For any other questions please contact Diana@iiaw.com.
LIFE & ACCIDENT/HEALTH
PROPERTY & CASUALTY
January 7-10 February 4-7 March 4-7 April 1-4 May 6-9 June 3-6 July 8-11 August 5-8 September 9-12 October 7-10 November 4-7 December 2-5
January 14-17 February 11-14 March 18-21 April 15-18 May 20-23 June 17-20 July 15-18 August 19-22 September 16-19 October 21-24 November 11-14 December 9-12
The course fee includes all class materials. Materials are distributed on the first day of class. You receive: • Life & Accident/Health or Property & Casualty Insurance Study Manual • The Intermediary’s Guide to Wisconsin Insurance Law • The Stat of Wisconsin Ins. Licensing Candidate Handbook (This provides all the information to obtain a license)
DAILY SCHEDULE
Day 1 (Monday)
8:30 am - 4 pm ($85) Section A: Principles of Insurance & General WI Ins. Law Ethics Day 2 (Tuesday) 8:30 am - 4 pm ($90) Section B: Life Policies, Terms & Concepts or Section B: Property Policies, Terms & Concepts Day 3 (Wednesday) 8:30 am - 11:30 ($45) Section B: Life Policies, cont. & WI Life Insurance Law or Section B: Property Policies, cont. & WI Property Insurance Law Noon - 4 PM ($45) Section B: Accident & Health Policies, Terms & Concepts or Section B: Casualty Policies, Terms & Concepts Day 4 (Thursday) 8:30 am - 4 pm ($90) Section B: Accident & Health, cont. & WI Health Insurance Law or Section B: Casualty Policies, cont. & WI Casualty Insurance Law
CLASS SITE/DIRECTIONS
The IIAW is located at 725 John Nolen Dr. in Madison, WI. When traveling south on John Nolen, it’s the last driveway before Highway 12/18 (Beltline). Located near the Alliant Energy Center and Sheraton Hotel.
INCLEMENT WEATHER
If weather conditions are questionable, use your own judgment regarding your personal safety.. If Madison public schools are closed, the IIAW is closed and pre-licensing is canceled for the day. Canceled classes are made up on Friday.
HOTEL INFORMATION
Student requiring lodging will receive a special rate at the Clarion Suites, 2110 Rimrock Rd. in Madison. Please call the hotel directly at 608.284.1234, and ask for the “Independent Insurance Agent” discount.
WISCONSIN INDEPENDENT AGENT
MAY 2019 | 5
REINVENTING THE LEADERS Over the last few decades, the IIAW’s Emerging Leaders Committee has planned and hosted a Leadership Conference in the Wisconsin Dells. This year they are changing things up! Over the last few decades, the IIAW’s Emerging Leaders Committee has planned and hosted a Leadership Conference in the Wisconsin Dells. This year they are changing things up! Introducing… A Capstone Innovation Conference. This year in partnership with Integrity Insurance Company and sponsored by IIAW Exclusive Company Sponsors, the emerging leaders committee is offering an innovation event where agents come up with solutions to challenges and opportunities impacting their work. Instructors will teach participants the process of ideation which leads to innovation. Groups will stay together throughout the day and present their solution to a panel of
Join IIAW Emerging Leaders at the Edgewater Hotel in Madison for “SHARK TANK”; an innovation event presented by Integrity Insurance and sponsored by IIAW Exclusive Company Sponsors. You’ll collaborate with fellow professionals to creatively solve hurdles — leading to solutions to help the industry and your business succeed. Plus, you’ll leave with a new approach you can apply in your own organization (and share with clients). Come and learn the tools and tricks to think outside the box and immerse yourself in the process of ideation which leads to innovation. Register today at www.iiaw.com. Space is limited on a first come first serve
judges (Shark Tank style).
basis. This is one event you won’t want to miss.
MATT’S MIXOLOGY: May Day INGREDIENTS 2 ripe peaches (pitted and roughly chopped)
1 tablespoon superfine sugar
1 part rum
2 teaspoon fresh ginger (grated)
4 strawberries (cubed)
1 cup crushed ice
2 passion fruit (flesh and seeds)
Garnish: Apple fans
4 ounces cloudy apple juice HOW TO MAKE Blend all the ingredients together with crushed ice. Pour the mix equally into two highball glasses. Garnish with an apple fan.
> Matt Banaszynski is the CEO of the Independent Insurance Agents of Wisconsin. Contact him at matt@iiaw.com.
6 | MAY 2019
WISCONSIN INDEPENDENT AGENT
SHIP CONFERENCE
INSURANCE BARTENDER
Schedule of Events Thursday, July 18 9am Registration Opens 10am Opening Remarks Meet Your Innovation Team! Groups will do a quick icebreaker to get to know one another 11am Session 1: Convergent & Divergent Thinking Teams will begin capturing ideas for how they would solve industry problems if they were given a “magic wand” (divergent) and if there was a single correct answer (convergent) 12pm Lunch Buffet Edgewater Grand Ballroom 1pm Session 2: Ideation Teams will start outline the details of their ideas. What does it look like? How does it benefit the agents and carriers? Who needs to be engaged? The solutions receive a name and short- and long-term goals are developed. 2pm Session 3: Design Thinking Teams use art supplies to develop a prototype of the solution (no artistic judgement here!). The purpose of the prototype is to spark right-brain thinking so have some fun with it! 3pm Session 4: Prepare a presentation for the Panel 4pm Enter the Shark Tank Teams will be present their product to a panel of judges (“Shark Tank” style) 6pm Dinner 8pm Cocktails in the Red Crown Rooftop Lounge The Red Crown Club is the capstone to the renovation of the historic Langdon Building. The most incredible part of the entire experience are the views, hands down. Take in all of Madison’s twinkling city lights and Lake Mendota’s waves lapping against The Pier. It’s an experience you can’t find anywhere else in the area and it’s all here, waiting just at the water’s edge for you.
Friday, July 19 9am Breakfast 10am Exposures on Your Agency Website, Social Media and in Agency Marketing Materials (1 CE) Learn about how agency websites, social media posts and marketing language can create special relationships and increase exposures for E&O claims. Hear real claim examples including attorney viewpoints. Learn what words and phrases should be avoided and what alternative language to use. 11am Cybersecurity Regulations: Your Agency Must Comply (1 CE) Handling sensitive information is now one of the most critical responsibilities faced by the modern insurance agency. Independent insurance agents and brokers must properly collect and protect sensitive client information every day. This means complying with state and federal regulations as well as adhering to customer service best practice standards. This session will review state and federal laws. In addition, we will discuss customer service best practices and provide participants with compliance tools and resources such as Agency Cyber Guide 2.0, Agency Cybersecurity Policy Template, and more WISCONSIN INDEPENDENT AGENT
MAY 2019 | 7
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An Equal Employment Opportunity/Affirmative Action Employer ©2019 Partners Mutual Insurance
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GOVERNMENT AFFAIRS
HAGEDORN DEFEATS NEUBAUER
WITH RAZOR THIN MARGIN FOR SUPREME COURT In the only statewide race in the Wisconsin April 2, 2019, spring elections, Court of Appeals Judge Brian Hagedorn defeated Court of Appeals Chief Judge Lisa Neubauer for an open seat on the seven-member state Supreme Court. Hagedorn’s surprising victory will soon be certified by the Wisconsin Elections Commission (WEC) now that Neubauer has officially conceded the race and the county canvass of votes has been completed. Hagedorn beat Neubauer with a razor thin margin (50.2 percent or just under 6,000 votes to Neubauer’s 49.8 percent) a difference of less than 0.5 percent. By law, Neubauer could have requested a recount by law, but chose not to delay the inevitable. This most recent court election had the third-highest turnout for a nonpartisan race in the state since 2000, with approximately 1.2 million voters. Only in 2016 (1.9 million) and 2011 (1.5 million) were the vote totals higher, and one of those was held during the same time as the U.S. Presidential primary election. Neubauer, who currently serves alongside Hagedorn on the appellate court in southeastern Wisconsin, will not run again for Supreme Court in 2020. Instead she will run for re-election to another 6-year term to the District II Court of Appeals, where she currently serves as Chief Judge. Hagedorn’s victory creates a vacancy on the court where Governor Evers will appoint a successor. Hagedorn replaces longtime Supreme Court Justice Shirley Abrahamson, who did not seek re-election to the bench. Abrahamson was appointed to the bench in 1976 and was the first woman to serve on the Supreme Court. The outcome of this particular court election came as a surprise to most political observers who had heavily favored Neubauer to win the race. Neubauer had strong base support, a commanding fundraising advantage,
10 | MAY 2019
and over two decades of experience in the practice of law. In comparison, Hagedorn is relatively a newcomer to the bench, a Scott Walker appointee who had served as general counsel to Walker when he was Governor. Some predicted that Hagedorn’s prior work experience would be another statewide proxy vote against Scott Walker, who lost his re-election last year to Governor Tony Evers by the thinnest of margins. Traditional business groups that are active in court elections and who typically would have backed a candidate like Hagedorn, held onto their money and sat on the sidelines in this race, demonstrating that even these groups didn’t think Hagedorn could win. Hagedorn’s election to the Supreme Court is consequential because he replaces an outgoing liberal Supreme Court Justice, Shirley Abrahamson, and gives conservatives on the bench a solid 5-2 majority. And, although Supreme Court elections in Wisconsin are considered nonpartisan, liberal and conservative groups in recent years have gotten more and more involved in backing judicial candidates to the extent that these races are now run very much like partisan political campaigns. Even the state political party apparatuses, like the Democratic and Republican parties, threw their support behind their preferred candidates even though the race is nonpartisan. For better or for worse, both liberal and conservative groups view
the court as critical to upholding laws on issues ranging from redistricting, gun rights, property rights, voting laws, taxes, regulations, and much more. Liberals thought that by trying to shift the balance of the court in their favor, they could potentially overturn laws approved by the Republican controlled legislature that they disagreed with. In this election, conservatives clearly backed Hagedorn and Neubauer had the support of liberals. The race was so competitive that had Neubauer successfully retained Abrahamson’s seat for liberals, it would have set up a major contest for control of the Supreme Court in 2020 where sitting Justice Dan Kelly is facing election to a full 10-year term on the bench. However, with Neubauer’s loss, liberals are now forced to seriously rethink whether or not they will expend resources in next year’s court election or focus their efforts on the U.S. Presidential election and state legislative races. With the election of Brian Hagedorn, conservatives will now control the state Supreme Court at least until 2023, and maybe longer depending on what happens with Justice Kelly’s election next year.
> Misha Lee, IIAW Lobbyist WISCONSIN INDEPENDENT AGENT
COMMENTARY FROM COUNSEL
DOL OVERTIME RULEMAKING, REDUX On March 7, 2019, the U.S. Department of Labor (DOL) issued a Notice of Proposed Rulemaking regarding changes to the “white collar” overtime exemptions under the Fair Labor Standards Act (FLSA). The new proposed rules are not the first crack at amending the exemption—a similar effort under the Obama administration met a slow and painful death by litigation and politics. The renewed effort reflects lessons learned in the earlier court challenge and, in most respects, a more employer-friendly approach. The DOL estimates that the proposed changes would make more than a million additional workers eligible for overtime.
Obama-Era Overhaul Failure In 2017, the United States District Court for the Eastern District of Texas ruled that the DOL exceeded its authority by increasing the salary basis requirement from $455 to $913 per week. The salary increase was former President Barack Obama’s last effort to impact wages under the FLSA. In striking down the DOL’s salary increase, the court stated that the FLSA defined the so-called “white collar” exemptions for administrative, executive and professional employees based on the duties those employees perform. According to the court, the DOL “does not have the authority to use a salary-level test that will effectively eliminate the duties test” required by the FLSA. The court distinguished the DOL’s use of the $455 per week salary threshold from the proposed increase to $913 by stating that the former “sets the minimum salary level as a floor” that effectively “screens out” employees who are “obviously nonexempt”—but the court did not explain how the proposed $913 per week level did not set a similar floor or screen out obviously exempt employees. The court commented that, had the $455 weekly
12 | MAY 2019
threshold simply been adjusted for inflation, such an increase would have been lawful. The Texas court’s ruling invalidated the DOL’s salary increase nationwide, and the DOL appealed. However, to avoid negative precedent and, of course, due to the results of the 2016 presidential election, the DOL abandoned the appeal and undertook new rulemaking.
Trump-Era DOL Efforts With an eye toward avoiding judicial invalidation of new rules, the DOL’s latest proposed rules affecting overtime exemptions include the following key components: The salary basis threshold would increase to $679 per week ($35,308 per year). The DOL set this threshold by using the same methodology from the 2004 revisions, which set the salary level at $455 per week. In 2004, $455 per week represented the 20th percentile of earnings for full-time salaried workers in the lowest-wage census region and in the retail sector. The new annual salary of $35,308 represents the DOL’s estimate for the 20th percentile standard in January 2020, when it anticipates the rule to become final. The proposed rule would also permit employers to count nondiscretionary bonuses and incentive payments (including commissions) paid on an annual or morefrequent basis to satisfy up to 10 percent of the standard salary level.
The salary basis threshold for highly compensated employees would increase from $100,000 to $147,414 per year. The proposed salary basis threshold represents the 90th percentile of full-time salaried workers nationally, as projected by the DOL for 2020. This was the same methodology used by the DOL for the Obama-era rule. Regardless, this proposed change has drawn attention, not only because it is a $47,000 increase, but also because it is a larger increase (by $13,000) than the proposed change under the Obama administration. Many employers rely on the highly compensated threshold for exemptions, so comments on the proposed rule are expected to be heated. The duties tests for executive, administrative and professional employees remain unchanged. Assuming an employer has properly classified its exempt employees, the proposed rule will not change that classification, unless the employee no longer satisfies the salary basis threshold. The comment period for the proposed rules runs until May 21, 2019. With stakeholders on both the employer and employee-side of these issues highly motivated and a presidential election next year, these proposed rules will likely face myriad court and political challenges before taking effect. > Josh Johanningmeier, Godfrey and Kahn, IIAW Legal Counsel WISCONSIN INDEPENDENT AGENT
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Keystone is proud to name Burns Insurance Agency to its growing list of partners in Wisconsin! They have accomplished impressive growth year after year which says a lot about the quality of their agency! Partnering your agency with Keystone provides you the resources that generate growth and expand opportunities. In the face of an ever-changing industry, agents need unified stability and strength. Because independence works better together.
CONTACT FOR MORE INFORMATION: JoAnn Hartung 570.473.4340 | jhartung@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.
VIRTUAL UNIVERSITY
WHEN SWEET FIFI BITES Depending on the source, there are between 78 to 90 millon dogs in the US. The American Veterinary Medical Association (AVMA) reports 78 million dogs and the Amercian Pet Products Association (APPA) asserts 90 million. Regardless the true number, the insurance industry reported 17,297 dog bite claims in 2018, resulting in $675 million in total liability payment.
Although this is a 6 percent decrease from 2017 numbers, industry statistics from the Insurance Information Institute (I.I.I.) show that approximately one-third, if not more, of homeowners’ insurance liability claims are attributable to dog bites. Approximately 4.5 million people were bit by dogs in 2018, and one in five of the victims required medical attention according to the AVMA. And the I.I.I. reports that the average cost of a dog bite claim was $39,017 in 2018 - a 5.3 percent increase over 2017 costs and more than twice the cost in 2003. Where do most dog bites occur and who gets bit most often? Statistically, 61 percent of dog bites occur at the owner’s home; and 77 percent of victims are bitten by a dog owned by a family member or family friend.
Nature Vs. Nurture: Breed Vs. Training Animals 24-7 editor, Merritt Clifton, conducted a long-term study of dog bit fatalities to determine if breed mattered. His study covered the period September 1982 to May 2016. During that period 658 documented cases of dog-attack deaths were reviewed. Seventy-eight percent of fatalities were attributable to five breeds, and pit bulls accounted for more than half the fatalities: 1. Pit bull / pit bull mix 53.5 percent of the fatalities; 2. Rottweiler / Rottweiler mix 14 percent of the fatalities; 3. Husky / husky mix 4.3 percent of the fatalities; 4. German shepherd / German shepherd mix 4 percent of the fatalities; and 5. Bull mastiff / bull mastiff mix 3 percent of the fatalities. From 2017 through 2018, pit bulls accounted for 74 percent of dog attack deaths in the US and Canada. Seventy-three of the 99 dog-attack deaths were by pit bulls.
by the dog (a trespasser, someone committing a crime or the victim harassing or teasing the dog may be exceptions). Three “Dog Bite Statute” states apply negligence laws rather than strict liability within their dog-bite statutes. In general, these statutes mandate that the owner has a duty to keep the dog under control and failure to do so could result in civil liability. These states are: > Georgia: if the dog is “vicious or dangerous;” > Hawaii (applies a mixture of strict liability and negligence): Strictly liable if dog known to be dangerous; but can be found negligent regardless of the “propensity” of the dog to violent behavior; and > Tennessee: regardless of the propensity of the dog to violence. “One-bite” rule: Sixteen states do not have “Dog Bite Statutes.” These states apply the “one-bite” rule. In “one-bite” states, the owner is not held liable for the dog’s first bite. But once an animal has demonstrated vicious behavior, such as biting or otherwise displayed a “vicious propensity,” the owner can be held liable for future bites. Some states have moved away from the absolute application of the one-bite rule and hold owners responsible for any injury, regardless of whether the animal has previously bitten someone, if the dog is of a known dangerous breed (based on nature). These are known as “mixed dog bite statute states” as they apply a mixture of the “one-bite” rule and the strict liability rule based on the breed. Negligence laws: Several “one-bite” states apply the concept of negligence in determining the liability of the owner. Essentially, the dog owner is liable if the injury occurred because the dog owner was unreasonably careless (negligent) in controlling the dog. Four requirements must be met to prove the owner was negligent: 1) the dog’s owner had a duty to use reasonable care in handling or controlling the dog; 2) the duty was breached; 3) an injury was inflicted; and 4) the injury was a direct result of the breach of duty. Regardless of the law or concept applied, most states do not hold dog owners liable for injury to trespassers.
Dog Owner Liability States treat dog bites differently, applying one of three concepts to govern the liability or responsibility imposed on dog owners: Strict Liability (“Dog Bite Statute”): Thirty-four states and the District of Columbia apply a “Dog Bite Statute.” Dog owners in 31 of these states (and DC) are strictly liable for any injury or property damage caused
14 | MAY 2019
If a dog owner is statutorily held or judged to be legally responsible for injury or damage, he may be required to pay the injured person’s: 1) medical bills; 2) lost wages; 3) pain and suffering; and 4) property damage (if any). State by state information is available here or https://www. WISCONSIN INDEPENDENT AGENT
independentagent. com/vu/SiteAssets/ Reference%20 Lists/170303%20-%20 Dog%20Owner%20 Liability%20Rules%20 by%20State.pdf.
Insurer Response Homeowners’ insurers take dog bites very seriously. Both Insurance Services Office (ISO) and American Association of Insurance Services (AAIS) have promulgated dog-bite liability exclusions. And some carriers have developed proprietary dog-bite exclusions (or limitations). However, some state’s Homeowners’ rules do not allow the use of a dog bite exclusion. Likewise, some states do not allow carriers to charge additional premiums for the dog bite exposure. Consequently, insurers in these states must underwrite around the exposure. This could mean not accepting risks where there is a known exposure, or nonrenewing insureds when the underwriter becomes aware of an exposure after initial acceptance if this is even an acceptable reason in statute.
Additionally, the law or concept applicable in the state plays a part in the underwriting decision. If the insured is in a “strict liability” state, the carrier is “on the hook” for any and all dog bites. Underwriters with insureds in “one bite” or “negligence law” states may have a bit of “wiggle room” (if the dog bites, the underwriter has a chance to “get off the risk” before another incident). Regardless of the state, the availability of exclusionary endorsements or the ability to charge a higher premium, insurers are attempting to underwrite the dog exposure by identifying the breed of the dog in question and assessing the extent to which the exposure is increased by that breed. From an underwriting perspective, statistics are more powerful evidence than how gentle and loving the owner claims his pit bull, Fifi, is. > Chris Boggs, Executive Director of the Independent Insurance Agents and Brokers of America (Big “I”) Virtual University
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MAY 2019 | 15
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VIRTUAL UNIVERSITY
THE INSURANCE INDUSTRY’S OPINION OF WARREN BUFFETT’S NEW 3-PAGE POLICY
Berkshire Hathaway announced the release of its new small business policy, THREE, on February 11, 2019. In response to this announcement, the VU published its critique of the policy on March 1 (See Warren Buffett Champions an Inferior Product”). Insurance Journal republished the VU’s analysis in late March, but with a twist. IJ’s article contained a survey seeking the industry’s opinion of this new product asking, “What do you think of Berkshire’s THREE policy?” Insurance Journal gave the VU permission to report the results. Following is the industry’s response rounded to the nearest whole percentage: Dangerous for insureds: 27% Step in the right direction even if flawed: 23% Step in the wrong direction with too many flaws: 14% It will fade away: 12% Other carriers will copy the idea: 12% A smart competitive move: 12% Based on these responses, there is no clear majority on either side. In fact, the responses are nearly split down the middle. Fifty-four percent of respondents hold a negative or somewhat negative view of this new policy. But approximately 46 percent believe this is a step in the right direction,” other carriers will copy the idea” or even that this is a smart competitive move.” Even I come down on both sides of this issue. Being a traditionalist, giving up decades of precedent seems very dangerous. Attempting to create an “easy-to-read” form devoid of debated, tried and ultimately settled terminology is a plaintiff attorney’s dream. Defense costs and ultimate claim costs could WISCONSIN INDEPENDENT AGENT
surely wreak havoc on the industry (and combined ratios). However, consumerism must come to the insurance industry and be led by the insurance industry. Disrupters are capitalizing (in less dramatic fashion than they claim) on the idea that consumers want it their way - easy to purchase. But their method of capitalizing on consumerism is based around how the product is purchased. This is where Buffett and his team are taking a different path. Berkshire Hathaway is “attacking” the legal language of the insurance policy in its path towards winning with consumerism. And this may be the most direct path to victory over “traditional insurance.” Ease of purchase is of little consequence if I don’t understand what I bought. Steve Jobs capitalized, in a BIG way, on making the product easy to understand. He didn’t necessarily change HOW consumers purchased a computer; he focused on the ease of setup and operation. That’s Buffett’s goal with THREE.
But there are a lot of smart people in this industry who may be able to build the right product. Regardless its final look and length, agents will still have an important role in differentiating among the various “simplification” projects. Unless there is one policy used by every carrier (which is highly unlikely if not a, “there ain’t no way this is ever going to happen” situation), agents must be able to explain the differences. Just like the VU’s review of the THREE policy, agents must be available to help client’s compare the “simplified” options. Well, agents should be doing this now in the “traditional” market, but that’s a different discussion. To throw a weird twist on this future, agents in this coming world will be forced to understand the coverage options of the various “simplified” policies more than they are expected to understand coverage today. Why? Because consumers will be able to understand the language, but they will not want to take the time to compare, meaning they will depend on the agent to compare but will be able to confirm the agent chose well.
Don’t misunderstand, I still think THREE is dangerous with too many limitations, gaps and unanswered question, but it is something the industry must take seriously. Consumers are going to demand a similar type of insurance program. The industry must take the lead in developing a simple package policy. But it can’t be done in three pages.
Whether we like it or not, consumers are going to demand something similar to the THREE from the entire industry. Our job is and will remain advising insureds on the best options available. Then, just like now, price should not be the main concern coverage will be the primary concern.
What is the magic number? I have no idea.
> Chris Boggs, Executive Director of the Independent Insurance Agents and Brokers of America (Big “I”) Virtual University
MAY 2019 | 17
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‘VISHING’: ADD IT TO THE LIST OF STRATEGIES FOR CYBER CRIMINALS
RISKY BUSINESS
In one minute, you could lose access to your cell-phone account. A hacker uses social engineering, hacking without code, to steal your personal information and begin their journey to take as much as they can. Vishing, voice phishing scams, are just another way cyber-attacks are being conducted. By calling a cell-phone provider, hackers could pretend to be your wife, husband, or another individual that would be reasonably associated with the account. They are persistent as well and will try again and again until someone from a provider is ‘kind’ enough to give them the information and access they are looking for. But why would access to your cellphone account or any other utility be of interest to a hacker? By gaining access to your phone account, a hacker can then get access to your text messages and phone calls by obtaining a copy of your SIM card. After obtaining a copy of your SIM card, any multi-factor
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authentication that uses a text message to confirm the identity would be routed to the hacker. Therefore, if email, online accounts, or accounts with a financial institution use a text or phone call to reset a password, the hacker could obtain access just by having access into your cell-phone. While email phishing scams are the most popular and common, ‘vishing’ is another technique to be aware of. Vishing is a cyber attack where fraudsters use human trust to obtain as much information as possible. This could also work the opposite way as well. A hacker could pretend to be an organization and attempt to get as much information directly from you until you share monetizable information. Don’t be fooled by the number that they are calling from; hackers are fully aware of ID spoofing to make it appear they are calling from a legitimate source by changing the apparent number the call is coming from. How do you protect against this? Education, awareness and thinking like a risk manager. First, look for signs that the call may not be legitimate. Were you expecting a call from the company or organization? Think twice before giving out any valuable information and if you are skeptical, call the number from your phone to verify a legitimate question or conversation. Another good idea is to make a list of all the organizations, companies and third-parties you work with. Whether it is service provider or cleaning service, what access do they have and confirm that a company calling is someone you actually work with. Lastly, think like a risk manager. What is the risk versus the benefit of following through with an action. Is the person that is calling about certain information reasonable and realistic with what they are inquiring about? Your agency could also be the target of a vishing scam. If someone calls your agency appearing to be an insured, do you verify that the person calling is actually who they say they are before providing personal information? A simple step in customer service to have a client verify who they are before providing information about the policy can help reduce the risk of falling for a scam. For example, having a client verify the policy number is a possible way. The risk of a cyber-attack, whether it’s phishing, vishing or any other technique, will likely exist for a longtime. Your agency needs to stay aware and vigilant of the strategies that fraudsters use as well as the potential loss that could occur. By always keeping the possibility of someone not being who they say they are in the back of your mind, > Evan Leitch: whether it’s an email or phone call, can help Technology and Risk Advisor reduce the risk of a cyber breach.
MAY 2019 | 19
FIND THE GOLDMINE IN YOUR EXISTING RESOURCES The best agency owners and producers are always looking for new opportunities to grow their business. Those that aren’t certainly should be. But when asked why they haven’t become their best version possible, they usually start with “if only” statements: If only we had that market; if only we had that technology; if only we had that tool; if only we had more service people; if only we had a new office; if only we expanded to another location. Here’s my challenge: Stop “if only-ing” yourself! Those are just excuses. I believe that every agency has a great opportunity that’s been hidden inside its shop for years, if not decades. That hidden opportunity—which is really hidden business— is to maximize all of its existing assets and resources. We refer to that as “redeployment management.” That’s when an agency takes its existing assets/resources and allocate them differently for a better result. Before I go any further, let’s agree on some basics. > 1 Client acquisition is always more expensive than client retention (i.e., it costs more to sell new business than to retain existing business). > 2 The most profitable clients are your full-time, long-term clients (the ones who buy all their insurance and risk management services from your agency). This is an excellent exit barrier because if no one else is in, no one can get in! > 3 Most of your producers are part-time producers. If they are not investing (vs. spending) at least 20 hours each week with clients, future ideal clients and centers of influence, they are simply not in the game. > 4 You only score points (make sales) when you’re in the game! > 5 The average agency loses money on at least 50% of its clients, so its profitable accounts are subsidizing unprofitable ones! > 6 The average producer suffers from the 2-2 Syndrome—too many accounts paying too little each.
20 | MAY 2019
Recently I facilitated a private meeting with an elite group of high-performing agency principals whose average revenue was just over $20 million. Before the meeting I surveyed the group about metrics related to their sales performance. We discovered that, on average, only 43% of their producers had met or exceeded their sales goals. This identified a tremendous hidden opportunity: producer productivity! If you’re going to redeploy assets, you want to redeploy them in a way that dramatically improves your overall results. This starts with producer productivity, which means getting producers who meet or exceed their goals. Sure, you need to keep adding new producers. However, shouldn’t you fix those underachieving producers first, or fire them? Otherwise, if you bring a new producer into a broken system, it’s likely he or she will fail.
Identifying hidden opportunities So, where’s your hidden business, and what are you doing to capitalize on it? Here’s a short list of what every agency should be doing to seize hidden revenue-enhancing opportunities. Improve sales. Your number-one goal should be to improve producer productivity (a.k.a. sales) by at least 25%. How many of your producers met or exceeded their sales goals last year? If it’s fewer than 50%, what does that tell you? It tells me that one or both of the following is responsible for their lackluster performance: A poor goal-setting process. For way too many agencies, their “process” is about as random as picking a number out of a hat. “Okay, everyone will do $100,000 of new business this coming year.” The poor performers don’t believe it. They don’t buy in because they weren’t part of the design, so that’s not “their” number. Lack of accountability. You can’t dump a random sales goal on a producer and wait until the end of the year to evaluate his or her progress. Trade down. Book of business trade downs are
a key to producer productivity. We know that the bottom 50% of the average producer’s customers generate less than 10% of revenue. How much are these accounts costing you in terms of time, energy and resources? Several years ago, I received a great letter from a young producer who had just graduated from our producer training program (FYI, the best never graduate—they keep learning). It read: “Coach, thanks for a great experience. I wanted to share what I did after our first session. I told my wife how excited I was and that I was going to trade down the bottom 80% of my clients. Her response: ‘Are you crazy?!’ Being a typical guy, I told her to trust me and assured her that I knew what I was doing. Well, here I am 12 months later, and I have 70% fewer clients than when I started, but I have 21% more revenue! Thank you!” Today this producer has over $3 million of commission income and fewer clients than when he started with us. Write 100% of all your clients’ business. This means personal lines, commercial lines, benefits, life insurance and for some of you, their financial services, as well. The crazy part is that typically, you’re not asking them to buy anything new! Yes, I know you’ve heard this a hundred times, so why haven’t you taken advantage of this hidden opportunity? Experience tells me that for every $1,000 of commission income you’re getting today from your clients, there’s at least another $1,000 sitting out there in the hands of one of your competitors. Increase client retention. Do you know your numbers, or are you guessing? As I’ve discussed in the past, improving client retention by 3% could improve profits by 6% to 10%. It’s that simple! It really boils down to installing exit barriers, which is relatively easy to do and yet most producers don’t do it. Improve your client experience. We know that having a great client experience is one of the factors that leads to 99% effective retention and 50% referrals. If you’re not consistently wowing your customers, that’s a hidden opportunity to make dramatic improvements WISCONSIN INDEPENDENT AGENT
SALES
to your client experience. What does your new client onboarding process look like? How does it feel to them? During a recent stay at my “home away from home” in Georgia, I was referred to a local dentist after I chipped a tooth. Although I’d sent them all of my information electronically ahead of time, they asked me to be there 15 minutes before my scheduled time. When I arrived, I was greeted warmly and given a walking tour of the facility, including the treatment rooms, meeting rooms and offices. It was quite impressive. As we toured, they told their story and discussed their community involvement and the projects they support. They also explained that any patient who referred a new patient could win a Yeti cup, golf umbrella or any number of really nice prizes by spinning the office’s gaming wheel (think Wheel of Fortune). After I was seated in the dental chair,
the ceiling-mounted flat-screened TV kept me entertained and distracted. I could also request comfort items from a laminated list that included a warm blanket, a cup of hot tea, aromatherapy, or a bottle of water served with a complimentary custom koozie. It was such a positive and memorable experience that I’m looking forward to my next dentist visit. When possible, do you have new clients come to your office, which gives you the home-field advantage? Do you provide a walk-through tour or orientation? Have you ever wondered why only 5% of your clients are giving you referrals? It has a lot to do with their experience and of course, whether you even ask them. Specialize. It’s widely known that specialists in any profession almost always make more money than general practitioners. If you have not identified the specialties in your
business, do a book of business survey. You may be surprised to see that you already have some specialties. For example, if you write eight restaurants or six property managers, you probably have a specialty. When you have a handful of similar accounts, you have referral sources, you have the markets and you can speak their language. Now go immerse yourself in that niche. Rather than always worrying about the “if onlys,” why don’t we just take these hidden and ignored opportunities and allow them to grow? Isn’t that what your best version possible would do? As always, it’s your choice.
> Roger Sitkins, CEO of Sitkins Group, Inc., developed The Sitkins Network and The Better Way Agency program. Insurance professionals with diverse levels of experience have benefitted tremendously from his training and leadership.
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DISASTER GUIDE BEFORE, DURING AND AFTER
AGENCY OPERATIONS
An IIABA program and IIAW member benefit, the Agents Council on Technology’s (ACT) mission is to bring all independent agent & broker distribution stakeholders together to advance the use of the most effective agency workflow technologies which enhance productivity, sales & marketing, service, and security. IA agents & brokers, carriers, vendors, user groups, associations, and consultants all participate on ACT work groups and in our two in-person ACT Meetings. Contact IIAW if you would like to learn more. ACT’s Disaster Planning work group has prepared an updated Disaster Guide that provides a map for not only planning but also response and recovery. It will help your agency minimize harm to individuals and business operations and will allow you to quickly return to serving customers in their greatest hours of need. Before diving into a response plan, you’ll need to undertake a disaster risk assessment. ACT has a great assessment that helps you rank the perils you most likely will face, which will guide your overall response priorities and strategy. To help you get your initiative started, the Disaster Guide suggests you identify employees who will participate in the implementation of your response plan. Your employees, both at the leadership level and at the core functional level, will each have a special responsibility or set of responsibilities, and seamless integration is crucial. Controlling the flow of information internally and externally will eliminate confusion and help you
as soon as possible. Waiting until a storm is on the way could leave you without easy, affordable resources. Your carriers and vendors will appreciate your outreach and may already have excellent suggestions or programs of their own for disaster response that you can work with claims, emergency personnel and payments, authorized adjusters and contractors. Designating a couple of employees as managers of these integrated plans can create expertise that will be sorely needed in a pinch. Your agency management system should be current with updates, and you should have remote access to all your files and programs. Cloud-based systems and a paperless environment can save the day if your hardware takes a direct hit. During a disaster, your priority is safety and awareness. If you have a text tree or a Twitter account or some other marked safe or need help contact method, you will want to use it in the midst of the disaster. A battery-operated radio,
communicating vital information to those using cell phones when the power is out, so make sure your website is mobile compatible and updated with the latest information your clients need: claims, temporary housing, food and water, pet assistance, medical care, etc. When roads are passable and travel is permissible, the person assigned should check the office. If it is safe and usable, you can start reaching out to clients, carriers and the media with information on your capabilities and accessibility. Lastly, don’t forget to run a post-disaster debriefing. This will give you a chance to iron out any bumps for the next time. And don’t forget that a second disaster could hit while you are still in recovery from the first. This means you must never consider the job done, and must keep on guard for a new blast of difficulty even when in response mode. Having that deeper plan could set you way above your competitors and be the difference between full readiness and unmanageable calamity.
get a consistent, coherent message out to carriers, clients and vendors alike. The initial preparations also involve your physical location(s), equipment, supplies, utilities, and transportation/mobile sites. In some cases, moving items to safer regions may be required, so partnerships should be established
charged spare batteries for cell phones, and crank lighting can be of great assistance during a disaster. Once it is safe to do so, you will initiate your disaster response plan, which includes checking with all employees and having everyone execute their duties. Your website is an excellent tool for
For the full ACT Disaster Guide, Visit ACT’s website, then on the left hand side click “Planning and Security” Tab, scroll down to click “Disaster Plan” or contact the IIAW for assistance. > Ron Berg ACT
EMERGING LEADER SPOTLIGHT Each month we will be featuring one of the active members of our Emerging Leaders Committee. Our May Emerging Leader is Ryan Morgan from Robertson Ryan & Associates in Milwaukee, WI. Tell us your name and a little more about you: Ryan Morgan from Menomonee Falls. I am a Producer and Vice President at Robertson Ryan & Associates. I work out of our Milwaukee office.
great industry speakers from all over the country, networking with new and old contacts, and spending time with family.
How long have you been on the Emerging Leaders committee? I joined the Emerging Leaders Committee almost 5 years ago.
Why should a new agent join the EL committee? Learning best practices from others and gauge what is going on in the insurance industry outside of their specific role/agency.
How did you hear about the Emerging Leaders Committee? Other agents at my agency recommended it. I also meet a couple committee members and it sounds like it would be a good fit for me.
What is your spirit animal? Dragon
Why did you choose to become active with the Emerging Leaders committee? To learn more about the insurance industry from the perspective of others in a similar position/age and network with them.
Where is your favorite vacation spot? Anywhere warm and quiet
What is your favorite EL event or activity that you’ve done with the EL group? The Sales and Leadership Conference - which combined
What is one professional goal for you in the next 3-5 years? Continue to grow my commercial/personal/life book of business
WISCONSIN INDEPENDENT AGENT
Do you have any pets? No
MAY 2019 | 23
Doing The Right Thing Since 1964 Standing Tall
Mark Maucere, Andy Roe, Jim Roe, Chad Trainor, Janet Phillips and Jim Eades
Ready to stand out? We’ll stand with you. To keep your agency relevant, you need the right products, partners and people. Our team of dedicated and responsive professionals can help you fill the gaps in your insurance offerings, providing more unique opportunities for you to meet the needs of your clients. The more you get to know us, the more you’ll see the possibilities.
Let us help you find the right solutions. ®
24 | MAY 2019
800.878.9891 ArlingtonRoe.com Aviation | Bonds | Brokerage | Commercial Lines | Farm | Medical Professional Personal Lines | Professional Liability | Transportation | Workers’ Compensation WISCONSIN INDEPENDENT AGENT
Capstone Innovation Session was formally the Leadership Conference
JULY 18-19, 2019
Edgewater Hotel, Madison, WI
SCHEDULE OF EVENTS July 18th 9 am
Registration Opens
Join IIAW Emerging Leaders at the Edgewater Hotel in Madison for “SHARK TANK”; an innovation event presented by Integrity Insurance and sponsored by IIAW Exclusive Partners. You will brainstorm and innovate creative solutions to help your agency and business succeed. Plus, you’ll leave with a new approach you can apply in your own organization (and share with clients). Come and learn the tools and tricks to think outside the box and immerse yourself in the process of ideation which leads to innovation.
10 am Opening Remarks
Meet Your Innovation Team!
11 am Session 1: Convergent & Divergent Thinking
Teams will begin capturing ideas for how they would solve industry problems.
12 pm Lunch Buffet Edgewater Grand Ballroom 1 pm Session 2: Ideation
Teams will start outline the details of their ideas.
2 pm Session 3: Design Thinking
Teams use art supplies to develop a prototype of the solution (no artistic judgment here!).
REGISTRATION INFORMATION $209 Members $239 Non-Members $214 a night - Edgewater Hotel Room block: IIAW - Emerging Leaders IIAW.COM
EXCLUSIVE SPONSORS
3 pm Session 4: Prepare Presentation for Judging Panel
Teams will work together to build their best presentation for the judging panel.
4 pm Enter the Shark Tank
Teams will be present their product to a panel of judges (“Shark Tank” style).
6 pm Dinner - Madison’s 8-11 pm Cocktails at Red Crown Rooftop Lounge
July 19th 9 am Breakfast Edgewater Grand Ballroom 10 am Exposures on Your Agency Website, Social Media and in Agency Marketing Materials (1 CE)
Learn about how agency websites and marketing language can create special relationships and increase exposures for E&O claims. Hear real claim examples including attorney viewpoints. Learn what words and phrases should be avoided and what alternative language to use.
11am Cybersecurity Regulations: Your Agency Must Comply (1 CE) Handling sensitive information is now one of the most critical responsibilities faced by the modern insurance agency. Independent insurance agents and brokers must properly collect and protect sensitive client information every day. This means complying with state and federal regulations as well as adhering to customer service best practice standards. This session will review state and federal laws. In addition, we will discuss customer service best practices and provide participants with compliance tools and resources such as Agency Cyber Guide 2.0, Agency Cybersecurity Policy Template, and more.
PARTNER SPONSORS Amerisafe Arlington/Roe & Co. Auto-Owners Insurance Central Insurance Companies CNA Insurance EMC Insurance
Fremont Insurance Madison Mutual Partners Mutual Philadelphia Insurance Wisconsin Mutual WPS Health Insurance
TECHNOLOGY
A LOOK INSIDE TODAY’S ACORD ACORD standards are crucial for efficient and effective operations in our industry, but they also play a material role in the development and deployment of technology. We turned to Bill Pieroni, President and CEO of ACORD, to find out more about the alignment of forms and standards with the carrier, vendor, and agency digital evolution. What we found is that ACORD is playing a role in almost every facet of tech development for the industry.
(This interview was edited for concision.)
have to reorganize their whole way of thought.
ACT News: How do you see technology affecting insurance transactions in the future, and what role will ACORD play in this?
ACT News: What role will our agency management system partners play in the delivery/availability of forms?
Bill Pieroni: There will be continued increase in the impact of technology. It’s what agents are demanding. I expect we’ll see better alignment with the goals of the agency, less transactioncentric products, and more focus on continuous-relationship management. ACORD will enable the creation and improvement of such solutions by vendors and other developers most especially through our standards.
Bill: We are very fortunate in the United States to have a very rich agency management system marketplace. Our forms and standards and database models don’t come alive unless they are embedded in that system. And our vendors invest significant amounts in developing new solutions. They are important partners to ACORD and our industry.
ACT News: How are agents communicating their demands?
TECHNOLOGY
Bill: ACORD hears directly from agents; they also talk to their carriers, who then talk to us. In order to make standards, we have to unpack those demands. ACT is working to play a key role in this effort as well, focusing the conversation and broadening the venue for information sharing. On our side, ACORD has created the ACORD Solutions Group, the vendor’s vendor so to speak. We are helping vendors serve agents through our standards, reducing cost, risk and time. We work with all manner of vendors, from startups to the biggest companies. ACT News: Technology is significantly streamlining workflows. How do you see this impacting ACORD forms, either in the delivery or availability of forms? Bill: I would say technology has the potential to transform traditional workflows. Some carriers and agencies are leveraging that. Some are not. Remember that leveraging technology means it actually has to work. In some cases, people are saying, It hasn’t made my life easier.” That’s because continuing with legacy organization and legacy processes but applying new technology gets you only so far. You won’t get the full impact of the new tools unless you recast processes, culture and the technology. For example, a form ideally wouldn’t exist until you need to submit or print it. A form is nothing more than a logical grouping of data. Sometimes that data is needed by an insurer, a regulator, etc., so we bundle it in a form. That form is embedded in the workflow. That’s an important point we have to grapple with if we are going to rethink the whole process. It’s not trivial for agents to
26 | MAY 2019
ACT News: We know the big names. Are there startups or insurtech companies that will play a role? Bill: Yes. The sector is attracting a lot of startups and insurtechs. ACORD is substantially involved in supporting those efforts. Startups can get an ACORD membership at a reduced rate, and we have the ACORD Innovation Challenge, which operates worldwide. We recognize and award startups that are changing the landscape and spurring innovation. We have relationships with every major insurtech incubator worldwide. ACT News: The state departments of insurance have a huge impact on changes to forms and standards. Do you foresee an opportunity to improve the process, or is it too overwhelming with all the various state players? Bill: We’ve been doing this for 40 years and have strong relationships with the departments of insurance and the National Association of Insurance Commissioners. ACORD is aligned with state imperatives. We stay engaged in those regulatory initiatives, and we shape and are shaped by them. ACT News: ACORD has made some important moves in cyber. Bill: Cyber is an interesting case. How are you going to underwrite something that has limited historical data, which was the case when cyber insurance was first sought? Beazley and Aon donated a number of assets so we could better understand how to address cyber for the industry. Working with some of the largest writers and brokerages is helping us to understand the current and emerging needs and imperatives in writing cyber. Their perspective and input are being used to build and enhance WISCONSIN INDEPENDENT AGENT
TECHNOLOGY
our cyber standard. We don’t have to start tabula rasa. We can then ask others, Why won’t this work for you? What do you need that’s different?” ACT News: Talk to us about analytics and business intelligence. Bill: This is something we as an industry have done for hundreds of years. Terminology sometimes gets in the way; we don’t recognize it. But agents have been doing analytics and business intelligence all along: they get to know their clients, understand their needs, provide good service, etc. Larger agencies need to apply digitized business intelligence because their data sets are too big to handle easily. Smaller agencies might not need as much technology because they’re already doing it intuitively. The key is housing that knowledge, making it available to others so the agency can run smoothly, and keeping aligned with standards partners are using. ACT News: For those not involved on a daily basis with blockchain, where do you see its greatest value for insurance transactions? Bill: Right now it is in an emerging, developmental stage. It may become a widespread viable solution. But users don’t have to understand it completely; they just need to know how to use it. Most people don’t understand the chipset in their computers or how mobile phone
transmission works. We just know how to use these tools. Blockchain poses opportunities and issues, so don’t ignore it. You ignore any major innovation at your peril. But you don’t have to obsess over the mechanics of it. ACORD is involved in every major blockchain initiative globally, and they are all using our standards in some fashion. The good news is that, whatever form of blockchain emerges, our standards will be at the core. ACT News: Anything else you want to touch on? Bill: Since coming to ACORD, we’ve done at least 12 studies looking at different lines of business. One consistent theme: independent agents are critical to our industry. We have found that carriers using independent agents outperform everyone else. I want ACT members to know that independent agents ARE our industry. There is no substitute. They may use technology to do their jobs, but they will never be replaced by it.
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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
MAY 2019 | 27
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ANSAY & ASSOCIATES LAUNCHES NEW DIGITAL AGENCY PLATFORM Proprietary technology built on top of DAIS platform PORT WASHINGTON, WI – (April 16, 2019) – Ansay & Associates has built its own digital agency platform on top the DAIS platform, while also becoming the first agency to adopt the Internet of InsuranceTM Operating System. The new technology decisively bolsters Ansay & Associates’ reputation as a leader in technological innovation. “We are committed to fostering a culture of innovation and growth at Ansay & Associates,” said Mike Ansay, the agency’s CEO. “This is a vital step on that journey. By harnessing the power of this new technology, we’re not only providing a streamlined experience for today’s customer, we’re setting a course for future generations, one that promises even more modernizations and improvements.” Erik Mikkelson, the agency’s innovative Chief Development Officer architected the solution on the DAIS platform. “We’ve been able to solve the 30-year-old SEMCI (single entry multiple carrier interface) problem with DAIS, which is already yielding a 20% reduction in our marketing expenses,” Mikkelson said. “Our success was enabled by DAIS’ flexible infrastructure and proprietary microservices. In our personal lives, we see companies like Netflix delivering video streaming through microservices – why shouldn’t we demand the same delightful customer experience in insurance for our policyholders and carrier partners.” Many of Ansay’s partner insurance carriers are helping Ansay to address these problems with their support, innovation capabilities, and vision for the future. “Change takes work, and the carriers that supported our innovation with their patience and persistence realized 9 points more growth in 2018 than carriers that were not supporting innovation,” said Mikkelson. Insurance industry veteran and DAIS co-founder, Aaron Larson, said it is rare to see an agency with this type of precision in execution given the magnitude of technology, people and process changes involved in this sort of transformation. “Ansay’s entire leadership team and organization deserves recognition for the amount of leadership and collaboration it exhibited in this accomplishment,” Larson said.
About Ansay and Associates Ansay & Associates serves over 5,000 Wisconsin businesses and 20,000 individual customers. It was recently named one of 2018’s “Best and Brightest Workplaces” by the National Association for Business Resources, earning a “Best of the Best” designation for medium-sized companies.
28 | MAY 2019
About DAIS Technology, Inc. DAIS is reimagining insurance by empowering agencies and carriers with a cutting edge software platform designed to handle the complexity of insurance. DAIS has a simple vision: A day in which agents, carriers, and policyholders are connected in real-time through a cooperatively-owned digital network creating a win-win-win for everyone involved.
West Bend Reflects on 125 Years 125 years of strong insurance coverage, safety awareness and community support. On April 13, West Bend will blow out the candles for our 125th birthday. Founded in 1894, West Bend predates cell phones, credit cards and even seat belts, and yet, our company continues to evolve in an ever-changing world while supporting the needs of Southeast Wisconsin. That’s 125 years of providing insurance coverage, promoting safety awareness, and one of our most valued causes, giving back to our Southeast Wisconsin community. Southeast Wisconsin has no shortage of worthy causes that need our support to continue their admirable work. That’s why we established the West Bend Mutual Insurance Charitable Trust which, to date, has provided more than $10.5 million to organizations throughout Wisconsin. The West Bend Independent Agents’ Fund has awarded more than $1.4 million to worthy organizations supported by our independent agents. We’re also very proud of our partnership with the Midwest Athletes Against Childhood Cancer (MACC Fund). Along with our independent agencies, business partners, and associates, West Bend has raised $2.6 million for the MACC Fund through our biennial fundraising event. We’ve grown our contribution an average of 52 percent biennially at a time when, according to Giving USA, charitable giving has increased about 3 percent annually. As we celebrate our 125th birthday, we reflect on what we’re doing to foster a culture of generosity among the next generation to sustain what we’ve built: • Leadership starts at the top, but expect engagement at all levels. Kevin Steiner, president and CEO of West Bend, serves as a director of the MACC Fund. He recognizes the hard work of the directors and staff and enjoys meeting the incredible kids. This knowledge and enriched relationship with the organization solidified his commitment to the MACC Fund. In order to be fully committed to a cause, it’s essential to learn as much as possible and, more importantly, believe in it. Commitment to the cause doesn’t end with West Bend leadership. Throughout the year, our associates and agents participate in events that provide an opportunity to learn more about and support the MACC Fund, as well as other worthy causes. This effort has created a culture of giving in which associates devote their time, effort, and creativity to organize and sponsor fundraisers for these great causes. WISCONSIN INDEPENDENT AGENT
• Tap into the loyalty you’ve created. Insurance is a people business and at West Bend, everyone works to deliver superior service because that’s what creates loyalty. Fortunately, this loyalty is returned in spades when West Bend calls on its agents, associates, and business partners to support causes; they open their hearts and wallets time after time. • Set an example. West Bend has a long history of supporting worthy causes in Milwaukee, southeast Wisconsin, and throughout the Midwest. Leadership consistently receives survey feedback about our associates’ pride for the company’s philanthropy. They see the good it does in their communities and we believe it accounts, in part, for their generosity to worthy organizations. Deep roots in the community are also key. Whether it’s insuring a nonprofit organization or a fundraising event, sponsoring local sports teams, or supporting community charities, West Bend strives to make Milwaukee a great place, everyday. As we celebrate a milestone birthday and look ahead, it’s important to understand that like all investments, cultivating a new generation of donors takes time, but it’s critical to creating a sustainable future for treasured nonprofits. As leaders, it’s imperative to communicate with associates about the impact supporting nonprofits has on our communities, to foster loyalty for nonprofits by cultivating loyalty with associates and customers, and to set an example with West Bend’s own corporate
philanthropy. We’re proud of our support of worthy organizations like the MACC Fund and we look forward to continuing that support for the next 125 years. Visit thesilverlining.com to obtain more information or to be connected with an agent.
Eric Twerberg Joins Compass Insurance Services Eric Twerberg has recently been named Employee Benefits Account Executive for Compass Insurance Services working in their Kronenwetter, WI location. . Eric has over 20 years experience in the employee benefits arena within operations, underwriting and sales for both fully insured and self-funded plans. He most recently was Chief Sales Officer at Security Health Plan. Eric is a graduate of Cardinal Stritch University with a major in Business Administration. He also received his Human Resource Management Certificate through Cardinal Stritch University. Eric is a veteran of the U.S. Army Reserve. Eric grew up in Edgar, WI and currently resides in Wausau, WI. Compass Insurance Services is a full service independent agency with offices in Kronenwetter, Wausau and Stevens Point. Compass Insurance Services provides Business Insurance, Personal Insurance, Employee Benefits, as well as Life and Health for families and businesses throughout the Central Wisconsin area.
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A true people person Meet Tricia, one of our Personal Lines experts. She’s a natural when it comes to connecting with agents and insuring your bundled home and auto business, just like the others on her team. It’s the genuine kind of expertise we look for at SECURA. And they’re supported by our caring claims group who will treat your clients like family. SECURA Personal Lines. It’s how you thrive. secura.net/personal
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