The Tennessee Insuror May/June 18 by Insurors of Tennessee

THE TENNESSEE

INSUROR May/June 2018

Vol. 29 No. 3

www.insurors.org

8 10 14

The Drive to 125 Insurors Celebrating 125 Years with Special Convention

Important Issues for Consumers, Insurers and Regulators Your Role in Fraud Mitigation Active Shooter Coverage

Expect big things in workers’ compensation. Most classes approved, nationwide. It pays to get a quote from Applied.® For information call (877) 234-4450 or visit auw.com/us. Follow us at bigdoghq.com. ©2018 Applied Underwriters, Inc., a Berkshire Hathaway company. Rated A+ (Superior) by A.M. Best.

2Insurance plans protected U.S. Patent No. 7,908,157.

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contents

THE TENNESSEE

INSUROR Vol. XXIX, Number 3 May/June 2018

features

Phone (615) 385-1898 Toll Free: 1-800-264-1898 Email: info@insurors.org Editor: Charles T. Bidek, CPCU Publisher: Daniel D. Smith Jr., CAE COVER PHOTO: Courtesy DNJ/Helen Comer

INSURORS OFFICERS

President ............................................................... Chris Allison, CIC Immediate Past President ................ John McInturff III, ARM IIABA National Director ......................................... Lou Moran III VP, Region II and President Elect .................................. Joe Hunt Vice President, Region I ................................... Norfleet Anthony Vice President, Region III .......................................... Bob McIntire Treasurer .............................................. Battle Bagley III, CIC, CPA Secretary ........................................................................ Chip Hoover Director, Region I ............................................ Stephen Masterson Director, Region I .................................................... Tommy Allmon Director, Region I .................................. S. Keith Phelps, CIC, CRM Director, Region II ................................. Matt Swallows, CIC, CRM Director, Region II .................................. Christy Jones, CISR, CAPI Director, Region II .............................................. John McCord, CIC Director, Region III .................... Kym Clevenger, CPCU, CACW Director, Region III ............................................................ Tim Witt Director, Region III ................................................. Mark Slater Jr. Young Agents Chairperson ................... David Allen, CIC, CRM

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Display advertising rates, deadlines and specifications may be obtained by writing to Insurors of Tennessee, 2500 21st Avenue South, Suite 200, Nashville, TN 37212, calling 615.515.2601, e-mailing dsmith@insurors.org or online at www.insurors.org The Tennessee Insuror is provided to all Insurors of Tennessee members and associate members as a member service.

INSURORS OF TENNESSEE 2500 21st Avenue South, Suite 200 Nashville, TN 37212-0539 www.insurors.org

4 The Drive to 125

Insurors Celebrating 125 Years with Special Convention

8 Important Issues for Consumers, Insurers and Insurance Regulators An Update from our Tennessee Commissioner of Commerce and Insurance 10 Your Role in Fraud Mitigation Consumers Can Help Turn the Tide on Bank Fraud 14 Daniel Learns About Ins.: Active Shooter Coverage When a Recurring Evil Begets a New Coverage Necessity

departments 21

From Your President

The Value of Great Leadership and Transition

From Your IIABA National Director

From Your CEO

Education Calendar

Government and Legal Affairs

Company Spotlight

Giving Back: A Volunteer State of Mind Please Do Me a Favor

Give Your Agency a Spring Cleaning Penn National Insurance

39 Program Spotlight RLI PUP Updates 51 Meetings 53

Member Tips

Give Your Agency the Best E&O Protection Available

The top two floors of Top Golf Nashville (pictured) are reserved exclusively for our Convention guests

The Drive to 125

Insurors Celebrating 125 Years with Special Convention

In 1893, the Insurors of Tennessee was formed as it's original entity – the Tennessee Association of Insurance Agents. In the 125 years since, we have worked to promote the success of the independent agency channel in Tennessee. As we celebrate this milestone, we will have several features and functions to commemorate the occasion. The main event will be our 125th Anniversary Convention, taking place October 27-30 at the Omni Hotel in downtown Nashville. We have been planning this event for several years, and we are excited to share the schedule with you. We will be making several announcements about special guests and speakers over the next few weeks, but we can release some of the information now.

Our Panelists for "Agency Vision 2020" On Monday morning, we will have a very special guest panel featuring executives from multiple carriers and wholesalers. This panel, titled "Agency Vision 2020: A Look at our Industry's Future," will be moderated by our Big "I" National CEO Bob Rusbuldt. The panel will discuss their outlook on the independent agency channel over the next few years and feature questions that our members have proposed. Here is our lineup of special guests:

On Sunday afternoon, we will begin our annual trade show, featuring over 80 companies, brokers and vendors from across the industry. In addition, you can update your headshot with a professional photograph in our " Smile Power™ Headshot Lounge"provided by Delta Dental of Tennessee. We'll also have some special "Express" breakout sessions and new features to take full advantage of your time.

Carrie Cheshier, CPCU, CIC, AIM, ARM Southern Regional President • Travelers Carrie Cheshier has been in the industry for over 30 years and began her career with Travelers in 1986 as a Liability Claim Representative. She has worked with both the personal and commercial lines leadership for the company and previously worked in commercial lines for a large agency in the Northeast. She earned her Bachelor of Arts degree in Business Administration from Weber State University.

Our special Opening Night Celebration will take place on Sunday, October 28th at Top Golf of Nashville. We have rented out the top two floors of the facility to be exclusive to our guests, and we have some great contests in store for attendees.

Jim Roe, CPCU, ASLI President/CEO • Arlington/Roe In 1972, Jim Roe joined his father, Francis Roe, who founded Arlington/Roe in 1964. He became president and the sole owner of Arlington/Roe after Francis Roe’s untimely death in

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1987. Roe has grown the company from $1.3 million in 1980 to over $200 million today. A graduate of Indiana University, Jim holds a Bachelor of Arts degree in Political Science. He is past president of the American Association of Managing General Agents, past director of the National Association of Professional Surplus Lines Offices and throughout his career has continued to serve as chairman or member of numerous legislative committees. Bob Rusbuldt President/CEO • IIABA Bob Rusbuldt has been part of the Big "I" for over 30 years, and has served as its CEO since 2001. He has been frequently recognized and awarded for legislative and regulatory work to support agents, brokers and small businesses. Rusbuldt is also a frequent contributor on many political discussion panels and has appeared on segments for CNN, MSNBC, Fox News and more. He graduated Summa Cum Laude from The King's College, New York, and earned his Master of Arts from American University in Washington, D.C. He was chosen to participate in the Symposium on the Presidency in 1978 and the American Studies Program. Christine Sears, CPCU, CPA President/CEO • Penn National Insurance Chris Sears joined Penn National Insurance in 1980 as a financial analyst. She held various positions of increasing leadership, and was elected to boards of directors of their affiliated companies during the 1990s, and to the Mutual Company’s board in 2002. Prior to being elected president & CEO, Sears served as executive vice president & COO for five years and was responsible for underwriting, claims, and the company’s third-party claims administration subsidiary, Inservco Insurance Services, Inc. Sears was raised in the Harrisburg area and earned her Bachelor of Business Administration degree (magna cum laude) from the Pennsylvania State University. She has also completed the Insurance Executive Development Course of the Wharton School of Business at the University of Pennsylvania. Kevin Steiner President/CEO • West Bend Mutual Ins. Kevin Steiner has worked for West Bend for almost 25 years, and previously worked for other carriers in Michigan before returning to his home state of Wisconsin. At West Bend Mutual, he worked his way up from association manager to corporate sales manager, vice president of sales, VP of marketing (which included underwriting responsibilities), senior VP and then COO and president. He attained his bachelor’s degree at the University of Wisconsin-River Falls and his MBA at the University of Wisconsin-Eau Claire. The Tennessee Insuror

Monday Night Special Event On Monday evening, we will have a special ceremony to honor the career and achievements of our Insurors CEO Chuck Bidek, CPCU. Chuck is retiring at the end of 2018 after 43 years of service to the Association. You can read more about Chuck's career and this special occasion on page 21. Our special Master of Ceremonies for the event will be Chuck's good friend, the "Voice of the Titans" Mike Keith. The event is sure to feature some special guests and be a night for all to remember. Don't miss out on this opportunity to celebrate the achievements of one of the "Titans" of our industry.

Association Day and Annual Meeting The Insurors Association Day and Annual Meeting will be held on Tuesday of the event, and feature our awards presentation and the swearing-in of our 2019 Board of Directors. We will also hear from special guest Jon Jensen, and agent and member of the Big "I" Executive Committee, as he gives us an update on what's happening in the national industry landscape, the Big "I" National and the independent agency channel. And don't forget our door prize giveaways, as you know we'll dial it up for our 125th Anniversary!

TENTATIVE SCHEDULE Saturday, October 27th (CST) Event TBD TBD Sunday, October 28th 9:00 - 11:00 am Board of Directors Meeting 11:00 am - noon Past Presidents’ & Board Luncheon 11:30 am - 12:30 Partner Program Luncheon 11:00 am - 6 pm Registration Open 1:00 - 6:00 pm Exhibit Hall and Trade Show 2:00 - 4:00 pm Trade Show Breakout Sessions 4:00 - 6:00 pm “Meet the Vendors” Exhibit Hall Reception 6:00 - 9:00 pm Opening Night Celebration at Top Golf 9:00 - 11:00 pm Young Agents After Party at TBD Monday, October 29th 8:00 - 10:00 am Registration Open 8:00 - 10:00 am Exhibit Hall and Trade Show 8:00 - 10:00 am Exhibit Hall Breakfast 10:00 - 11:30 am Carrier Executive Panel Noon - 5:30 pm Annual Golf Tournament at Richland CC Noon - 3:00 pm Cars & Cigars w/Music City Dream Cars 12:30 - 4:00 pm Clay Shooting at Nashville Gun Club 6:00 - 10:00 pm Company Night 7:00 - 9:00 pm Event Honoring Chuck Bidek Tuesday, October 30th 8:00 - 9:00 am Association Day Breakfast 9:00 - 11:00 am Insurors Annual Meeting 5

Jon Jensen, AAI, AIP President • Correll Insurance Group Jon Jensen is president of Correll Insurance Group, headquartered in Spartanburg, South Carolina. As an industry leader, he has served on committees of the South Carolina Department of Insurance and as the chairman of the IIAB of South Carolina. Jensen is the immediate past South Carolina national director for the Big “I”, is a past national chairman of the IIABA InsurPac Board of Trustees, and is past chairman of the National Government Affairs Committee. He was awarded the IIABA National Chairman’s Award in 2009 and the Sydney O. Smith Award in 2010. Jensen is a graduate of Appalachian State University’s Insurance Executive Program.

1893-2018

Register now or get more information by visiting our convention site at https://www.insurors.org/IOT/Event_ Display.aspx?EventKey=CONV18 We have a room block available at the Omni Hotel starting at $249 per night. Rooms are filling very quickly, so please visit https://www.omnihotels.com/hotels/nashville/meetings/ insurors-of-tennessee-annual-convention to reserve your room now. We also have an overflow room block available at the Hilton Garden Inn downtown for $229 per night, please visit the convention section of our website for those reservations. u

An event celebrating the career and achievements of Charles T. "Chuck" Bidek, CPCU CEO of Insurors of Tennessee • Monday, October 29th 7-9 pm CST • Omni Nashville

JOIN US TO CELEBRATE 125 YEARS OF INSURORS OF TENNESSEE

• • • • • • • •

B.B.A., The Ohio State University M.B.A., The Ohio State University 2002 Insuror of the Year award winner 2013 TNSAE Association Executive of the Year 2013 Inductee into the Tennessee Insurance Hall of Fame A highly respected lobbyist to the TN General Assembly Taught prelicensing to over 1,000 agents in Tennessee Member of the Advisory Board for the Tommy T. Martin Chair of Insurance at MTSU

OCTOBER 27-30, 2018 OMNI NASHVILLE DOWNTOWN VISIT INSURORS.ORG TO REGISTER NOW

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DonegalGroup.com 7

Important Issues for Consumers, Insurers and Insurance Regulators

written by Julie Mix McPeak, Commissioner of the TN Department of Commerce & Insurance

This article originally appeared in the CIPR Newsletter published by The Center for Insurance Policy and Research (CIPR) and the National Association of Insurance Commissioners (NAIC) and is reprinted with their permission. Further distribution is prohibited. It is a great honor to have been selected to serve as President of the NAIC. I am in awe of the power of this position. I am equally in awe of the challenges that we face and all that must be accomplished for this to be a truly successful year. With the support of NAIC members and their teams, the industry, the consumers we all serve and the NAIC support staff, we can accomplish many positive things in 2018. So I write this with the purpose of sharing my thoughts on some very important issues we will face together in 2018 and beyond. The challenges we face are many and our resources are precious. Let me start with noting some recent accomplishments that will help shape our future: State Ahead Work began on development of a strategic plan for the NAIC members to provide guidance and direction to NAIC staff. The plan was drafted and vetted during 2017 and was adopted on February 3, 2018. It is a three year plan covering 2018‐2020. The title of State Ahead was chosen to reflect the forward‐looking nature of the plan. State Ahead will be discussed in more detail in the section of this article called Key Initiatives for 2018. Natural Disasters When natural disasters occur, it is time for the insurance industry and its regulators to step up. In 2017, insurers and consumers faced heartbreaking and record‐setting challenges as insured losses from flooding, hurricanes and massive wildfires topped $134 billion. In a perfect world, one would hope every family and business would have the foresight to fully insure their homes and businesses against the perils they could face. The reality is many carried no insurance or purchased insufficient limits, particularly for the flood peril. Insurers sent in their catastrophe teams to help their policyholders at their greatest time of need. State insurance regulators banded together to provide mutual assistance to each other during this difficult time. I am very proud of those efforts and the caring nature of the dedicated state employees who volunteered when their skills and assistance was sorely needed. Support continues for Puerto Rico and the U.S. Virgin 8

Islands as they recover from the deadly hurricanes. Innovation and Technology On March 9, 2017, then NAIC President and Wisconsin Insurance Commissioner Ted Nickel announced the appointment of an Innovation and Technology (EX) Task Force and asked it to focus on cybersecurity, Big Data and helping regulators stay in touch with new and innovative products and services being offered by start‐ups and incumbent insurers. International Forum On May 16, 2017, the NAIC hosted the 11th annual International Insurance Forum bringing together more than 300 people from 20 jurisdictions to discuss global insurance markets and regulation. Topics covered included reinsurance, international capital standards and systemic risk. After insurance regulators expressed concerns about the U.S.‐ EU Covered Agreement, the U.S. Treasury’s Federal Insurance Office (FIO) and the United States Trade Representative (USTR) worked with us and representatives from the European Union to clarify the agreement. Among the important improvements were recognition of the U.S. state‐based regulatory system as sufficient to meet “equivalency” tests and agreeing to a timeframe for development of U.S. group capital standards. Cyber Security On October 11, 2017, the NAIC and the Stanford Cyber Initiative hosted a joint cybersecurity forum providing insight into the current cyber‐threat landscape and the role of insurance in managing and mitigating these risks. An inspirational keynote speech from Richard A. Clarke, former U.S. National Coordinator for Security, Infrastructure Protection and Counter‐Terrorism, provided attendees with some thought‐ provoking insights and suggestions for action. On October 24, 2017 we adopted the NAIC Insurance Data Security Model Law (#668) paving the way for its introduction in state legislatures. The model creates a common regulatory framework for licensed entities to responsibly manage their cybersecurity exposure. It requires regulated entities to maintain a risk‐based information security program to assure the public sensitive personal information is being made as secure as possible. Asia-Pacific Forum On December 1, 2017, the NAIC hosted the Fourth Annual continued on page 12 The Tennessee Insuror

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Your Role in Fraud Mitigation Consumers Can Help Turn the Tide on Bank Fraud

Fraud is not going away, especially in the banking industry. Each of us plays an important role within our household and organizations in an effort to mitigate fraud. Banks place a great deal of thought and time into appropriate procedures to minimize risk while balancing their processes and delivering an exceptional customer experience. We each go through these motions naturally, as they have become second nature. As I thought through this, I began to wonder, what if we could write effective procedures for bank customers to follow? Procedures that are not just recommendations, but instead things that become second nature to them. As much as the industry has automated monitoring and analytics to fight fraud, it has also produced many systems and features that allow you, as the customer, to participate in fraud mitigation as well. As we explore a few of these, think about how you can follow these simple steps to help in the fight against fraud.

Card Management for the Consumer Many electronic banking environments now allow you to control the availability of your debit card. This control is easily accessed via online banking or mobile banking and allows you to suspend your debit card when not in use. Keeping the card in a suspended status blocks any transactions from being authorized. With a few easy clicks, the card can be placed in active status for use as needed. While it may not be practical to go through these steps if you use your card multiple times throughout each day, it is certainly practical to suspend the card during periods of non-use, such as evenings or vacations and business trips when alternative payment methods are being utilized. Another function of card management allows you to easily alert the bank via mobile banking of travel times and destinations, so that the bank can validate charges outside of your normal geographic habits. These proactive alerts help improve the effectiveness of fraud analytics that monitor your spending habits and look for unusual activity.

written by Scott Gupton, INSBANK COO

Positive Pay for the Commercial Client If you are a commercial client, "Positive Pay" may be a viable solution for you. It provides protection against check fraud, especially in accounts with significant check volume. Significant volume extends the time in which it is practical to manually reconcile an account in order to identify fraudulent debits. Positive Pay is an automated fraud detection service that matches the account number, check number and dollar amount of each check presented for payment against a list of checks previously authorized and issued by your company. Typically, all three components of the check must match exactly or it will not pay. Positive Pay requires a company to transmit a file of issued checks to the bank. This transmission is easily accomplished through the bank’s Cash Management System online. When those issued checks are presented for payment at the bank, they are compared electronically against the file of transmitted checks. When a check is presented that does not have a match in the file, it becomes an exception item. You would then be able to review the image of the item and accept or reject the item for payment. Through automation, you only have to interact with the system if items are exceptions, thus minimizing your workload, but retaining control over debits to your account. While these are just a couple of examples of systems that allow you – the customer – to participate in fraud mitigation, you can easily recall fraud scenarios that you have witnessed and the positive impact these two systems could have had on those situations. Learn what your bank offers – after all, it is your money. About the Author J. Scott Gupton serves as Executive Vice President and Chief Operating Officer of INSBANK. With nearly two decades of banking experience, Scott oversees INSBANK’s operations, marketing, human resources, information technology and corporate and regulatory reporting. He rejoined INSBANK after serving as first vice president from 2000-2007. u

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Important Issues...

continued from page 8

Asia‐Pacific Forum offering an opportunity for regulators and industry representatives to discuss common issues facing the U.S. and the Asia‐Pacific region.

State Ahead Strategic Plan Last year, NAIC leadership embarked on a mission to develop a comprehensive strategic plan to guide the efforts of the organization over the next few years. I am happy to report the NAIC Strategic Plan: State Ahead was adopted by the NAIC members on Feb. 3, 2018. It covers the years 2018 to 2020. State Ahead provides a blueprint for the NAIC’s future. I would be pleased to provide you with an overview of State Ahead in this article. I do encourage you to visit http://www.naic.org/ state_ahead.htm to read the entire plan. State Ahead relies on three foundational pillars: data, technology and talent. The NAIC hopes to expand upon its world class data infrastructure to support the state insurance regulators needs in the coming years. Data is useless unless it is converted to meaningful and insigh􀆞ul information. That leads to the second pillar—technology. We must evolve to use modern technology for collection, storing and analyzing the data we receive. Finally, the NAIC and the states must continue to employ top‐notch talent to gather the data and turn it into useful information. State Ahead is organized around three themes. Each theme is supported by one or more goals providing details on how the theme will be addressed to execute the plan. The three themes should be no surprise to longtime followers of the NAIC. They are: 1. Safe, Solvent and Stable Markets; 2. Consumer Protection and Education; and 3. Superior Member Services and Resources. The goals underpinning each theme might prove more instructive. Under Safe, Solvent and Stable Markets is the goal to “provide insurance regulators with the data, training, and tools required to support a collaborative regulatory environment that fosters reliable and affordable insurance products.” There are two main objectives being considered to achieve this goal: • • • •

To optimize data and information for regulator‐focused analytics, and To evaluate regulatory opportunities arising from macroprudential surveillance.

The plan calls for modernizing the way data is collected and organized to make it more consumable for state insurance regulators, NAIC staff, the industry and consumers. This will empower users with self‐service business intelligence tools 12

to give greater insight into insurer financial condition and market practices. The second objective relates to analysis of how the insurance sector is impacted by broader financial markets, common risk exposures and the economy. Together these objectives should lead us to better organization and analytical reporting on the financial health of the insurance industry. Some of the work product expected includes: • • • • •

Creation of an enterprise data strategy and analytics data warehouse; Implementation of business intelligence tools with selfservice capabilities; Exploration of the use of advanced cloud computing capabilities; Application of business intelligence tools to NAIC and external data to improve macroprudential surveillance capabilities; and Enhanced support for the NAIC Financial Stability (EX) Task Force.

The second theme is Consumer Protection and Education. The goal underlying this theme is to “ensure consumer protection keeps pace with changes in the marketplace and consumers have the information and education needed for informed decision‐making.” Here are three objectives: • • •

To optimize use of market data and regulatory processes to enhance consumer protections; To provide effective and accessible consumer education and financial literacy tools; and To position the NAIC and its members as thought leaders in insurance regulatory innovation.

Consumers expect insurers to deal with them in ways comparable to their experience with other products and services. They increasingly want to transact business over the Internet or their smartphones, and they expect prompt service. State insurance regulators want to work with insurers and innovators to ensure they are mindful of consumer protection obligations. Economists tell us competition works best when there is an informed buyer and seller. To improve transparency in insurance markets we need to make sure consumers are empowered by being financially literate and educated on their insurance and risk management needs. Some of the work product expected includes: • • • •

Improvements to the Market Conduct Annual Statement (MCAS) filing process for insurers; Providing regulators with a solid, secure, cloud‐based platform for storage and analysis of MCAS data; Implementing business intelligence tools with selfservice capabilities for market regulators; Combining multiple data sources to enhance market regulatory oversight and insight to protect consumers; continued on page 46... The Tennessee Insuror

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Daniel Learns About Insurance: Active Shooter Coverage When Recurring Evil Begets a New Coverage Necessity

Insurors Director of Communications Daniel Smith is far from an insurance expert, but he is trying to learn! In this series he will look into insurance industry and coverage questions he has about popular trends in day-to-day life. On April 22nd at 3:25 am CST, a disturbed individual began shooting at a Waffle House in South Nashville and then continued the rampage inside the restaurant. He killed two people outside the restaurant, and two more inside (one of them was transported to Vanderbilt University Medical Center but died in the hospital). He wounded two additional patrons in the restaurant. Before the shooter could continue the damage from there, 29-year-old James Shaw Jr. – who had suffered a grazing bullet wound and hid near the restaurant's bathrooms – rushed him and wrestled the rifle away. After being thwarted by hero Ward, the cowardly shooter ran away, leaving behind his rifle and ammunition. Unfortunately, the thought of one us encountering an "active shooter" is now more prevalent than ever. Between 2000 and 2006, the average number of incidents per year was 6.4. Between 2007 and 2013, that number has risen to 16.4.1 Although many are debating the ways to prevent or lessen these occurrences, from an insurance perspective we must consider the exposure and liability left in the aftermath. Additional liability coverage, business interruption protec-

written by Daniel Smith, CAE

tion and more are factors that most be considered. Other costs that must be accounted for may include victim lawsuits, building repairs, legal fees, medical expenses and more. In the case of school shootings, costs may include counselors, media consultants and even demolition or reconstruction of buildings where the event(s) took place. School districts are now viewing active shooter coverage as a primary coverage discussion. Recently, The McGowan Companies told Insurance Journal that they have written, "three times more policies (in 2018) than a year before," per Paul Marshall, a broker for the company. “Every day we get a phone call from another school district,” Marshall said.2 Often the GL policy in place for a school is not sufficient to cover the additional expenses. In some cases, state laws limit the liability or amount a school system can pay out in the case of an incident. This can leave injured survivors with large medical bills that may be difficult to cover.

What and Who Needs to Be Covered? Generally, an active shooter event is defined as, "an incident involving an individual or group of individuals actively engaged in killing or attempting to kill people using firearm(s) on any location(s) of the insured."3 For coverage of these potential events, many carriers offer primary third party liability First responders on the scene of the Waffle House shooting in Nashville photo by Jason Davis © Getty Images

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Why Choose West Bend? People Insurance is a people business, and at West Bend, we pride ourselves on approachability and accessibility at every level of our company.

Relationships We consider the relationships with our agents to be partnerships. Agents are our primary customers, and we support, and wholeheartedly endorse, a strong independent agency system.

Stability Since 1894, West Bend has come to stand for excellence through the use of innovative products, steady growth, and financial stability. Since 1971, we’ve maintained an A (Excellent) or better rating from AM Best.

Regional Mutual Insurer As a regional mutual insurer, West Bend decides what to do, and our decisions are always based on what’s best for our agents, insureds, and associates for the long term. As a regional insurer, we understand the local and regional markets.

Products Our product offerings are well rounded, innovative, and diverse. West Bend is an industry leader in writing a wide range of businesses, including most found on your town’s Main Street. Through our specialty division, we specialize in writing risks many other companies turn away. Our bond department makes contract and commercial bonding easy to quote and issue. And our monoline workers’ compensation division provides a high-touch, resultsoriented approach to help customers control the cost of insurance.

Service Our dedication to service is what sets us apart from our competitors. Our knowledgeable and skilled teams of professionals provide unmatched service and dedication to our agents and their customers.

It doesn’t end there Put all of these together – and more – and you’ll find West Bend offers distinct value through superior agency relationships, strong financial performance, stability, commitment to outstanding products and services, and knowledge and experience. That’s why agents choose West Bend. To find out more about representing West Bend, contact Randee Hubbard at rhubbard@wbmi.com.

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coverage (for victim lawsuits), policy limits as high as $20 million and business interruption coverage. They are generally written as claims-made, and some carriers offer risk assessment and crisis management services as part of the policy. Some policies also cover incidents where other weapons than guns are involved. Knives, medical tools, corrosive substances and even explosive device attacks may be covered. In addition, acts that may fall under the classification of "terrorism" could be covered. This could be an important distinction on some policies, as often insureds reject the TRIA coverage on the their CGL policies.

A Point of Discussion for You and Your Insureds In the study cited earlier, the FBI found that 70% of incidents took place in either a commerce/business or educational environment. The largest percentage of active shooter incidents – 45% – took place in a business, while 24.4% occurred in educational environments and 10% on government properties. Much like Cyber coverage, Active Shooter coverage is something to discuss with almost all your business-owning clients. If they have a physical location, then they must consider the possibility, however slim. Some of these attacks have happened completely at random, while others seem to be related to a specific incident or location. If you insure schools, it is a topic that must be discussed with your clients. Just a few years ago, this was considered a coverage "gray area" for most GL policies. With additional and stand-alone coverages now available, it is incumbent on you as the agent to make sure that these institutions are properly covered. Some schools may have varying exposures based on their location, district or even public or private status. It's important to make sure they understand where their limits of liability may or may not end. This is an unfortunate but important topic for insurance professionals to consider. While we continue to hope that these incidents of active shooters will end or at least begin to decline, we must prepare our insureds for the worst-case scenarios. 1 - per "A Study of Active Shooter Incidents, 2000 - 2013" via Texas State University and Federal Bureau of Investigation, U.S. Department of Justice, Washington D.C., 2014. 2 - per "More School Districts Buying Active Shooter Insurance" via https:// www.insurancejournal.com/news/national/2018/03/21/483990.htm 3 - per "Active Shooter" blog post via https://www.beazley.com/usa/political_risks_trade_credit_and_terrorism/active_shooter.html

About the Author Daniel Smith serves as the Director of Communications for Insurors of Tennessee. He has a Bachelors degree in Marketing with a minor in Graphic Design from the University of Tennessee at Chattanooga. He may be contacted at dsmith@insurors.org. u 16

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17 4/13/2018 8:53:51 AM

Future Leaders Spotlight

presented by

Kayla Copeland • Cumberland Insurance Agency - Mt. Juliet Kayla Copeland is a Cookeville native who helped open the fifth branch of Cumberland Insurance Agency at the Mt. Juliet location. She loves, "anything with water and sunshine" and is active in the industry and community. Outside of insurance, Kayla is very involved in the Mt. Juliet Chamber of Commerce, where she is the chair of the ambassadors, on the Committee for Leading Women, and also co-chairs the "Besocial" Committee. In addition, she is active with the Kiwanis Club of Mt. Juliet where she serves on the board and as secretary. Kayla Copeland of Cumberland Ins. Agency

The Insuror: Can you tell us a little about your current job title and responsibilities? Kayla: I am an agent who writes all lines of business including personal, commercial, life, group health and group voluntary.

The Insuror: What can you tell us about your educational background? Kayla: My educational background consists of graduating from college with a degree in Education. In 2014 I attended the Hartford School of Insurance. In 2016 I attended an educational program through Encompass and Wharton School of Business. Not to mention all the education I have learned through my father who has been in the insurance business over 20 years.

The Insuror: How and why did you get your career in the insurance industry started? Kayla: In high school I didn’t really know what I wanted to do after graduation or what I would want for a major in college. I had been working at my dad’s insurance office over the summers and after school and had decided that I would like to get into insurance. I liked how it wasn’t always a sit at your desk type of job and you are involved with the community and get to meet and talk to a ton of people, which I enjoy doing. So after I graduated from High School I went and got my P&C license that summer. My thinking at the time was that since I already had an insurance license I could just skip college and start working. Well, that plan didn’t go over too well with my dad. He told me I had to get a degree before I could start working. Since I already had my insurance license I decided I didn’t need 18

to major in business because I had that path set out for me. I wanted a backup plan in case the sales part of insurance wasn't for me, so I majored in multidisciplinary studies (K-6 Education) at Tennessee Tech University and graduated in three and a half years. After graduation, I received my life and health license and started working in insurance and have never looked back.

The Insuror: Do you have any influences/role models in the industry? Kayla: One major influence and role model in the insurance industry is my father. He moved back to Cookeville 22 years ago and started his own insurance agency. He has always been my go-to person for any help, questions or guidance. He has so much knowledge from being an adjustor before opening his own agency. He also has shown how much hard work goes into this business but also the outcome that is so rewarding over time. He has taught me that there will be long days and nights but it will pay off and be worth it in the long run.

The Insuror: Is there any advice you could offer Young Agents or others in the industry to achieve success? Kayla: Being young in the insurance industry is hard. You have to be strong, confident and able to say, "let me check on that." One thing I have learned about insurance is that you cannot possibly know everything. There are so many different insurance needs, and sometimes you have to be okay with not knowing the answer right away, but instead making sure you get the right answer for the client. Being strong and confident is something that will help in your daily life and career. When you have that mentality people can tell and will want to do business with you.

The Insuror: As an independent agent, you have many partners in this industry, including carriers, MGAs and many more. How do you determine which ones are the right relationships? Kayla: Relationships are key in the insurance industry. A few things I look for when doing business with carriers is the communication avenues set in place, the end goal for both the carrier and us as an agency, the ease of doing business and the level of trust. Communication and trust are the two biggest points to knowing if it will be the right relationship or not. You have to be able to trust and communicate!

The Insuror: Thank you for giving us your time, Kayla, we appreciate it and wish you continued success. Kayla: Thank you for the opportunity! u The Tennessee Insuror

Young Agents â&#x20AC;&#x2DC;18

Upcoming Events and Information

Our Young Agents Committee strives to offer young insurance professionals with opportunities to network and develop in the industry. We accomplish this by hosting networking and educational events throughout the year in various Tennessee markets. The following is the current schedule of events for 2018, please contact Insurors or your Region representative for more info on these meetings or to RSVP for a specific event: Local Summer Events - TBD October 28 - Insurors Convention Young Agents After Party TBD â&#x20AC;˘ 9-11 pm CST

Young Agents Committee David Allen, CIC, CRM - Chair Principal Agent RSS Insurance Chattanooga dallen@rssins.com

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From Your President

The Value of Great Leadership and Transition

Our Insurors CEO, Charles T. "Chuck" Bidek, CPCU has given 43 years of service to Insurors of Tennessee. I'd like to take this opportunity to reflect on what that leadership has meant to me and this Association. To give you a brief history, Chuck met and married a young lady from Fremont, Ohio named Barbara; graduated from The Ohio State University and in the Spring of 1975; and made his way to Tennessee to become an Instructor of Insurance at the College at UT-Nashville (now part of Tennessee State University). While beginning his College Instructor Career with UT-Nashville he met Jim Alexander, the then Executive Director for the Insurors of Tennessee. They began a friendship and working relationship that, in September of 1975, turned into a part time position for Chuck as Education Director for our Association. Chuck has helped to license more than a thousand agents since 1975 and is still educating and leading our Industry with local, state and national understanding of the issues and needs of our industry. In 1987, Jim Alexander announced his retirement and the Board hired Chuck to become the fifth Executive Director of Insurors. For over 30 years Chuck has led the organization through location moves, automation development, insurance education, sales training, legislative issues, development of relationships with legislators, product development, convention enhancements and many other member opportunities that required his assistance or leadership. He was honored with our Association’s highest award in 2002 as the “Insuror of the Year” and was inducted into the Robert E. Musto Tennessee Insurance Hall of Fame at Middle Tennessee State University in 2013. What a blessing we have had in the great leadership of our friend and mentor Chuck Bidek as he has educated, licensed and befriended most of us in his 43 years with Insurors. He has put this Association in an excellent position to continue building and moving forward for the future. The Tennessee Insuror

Chuck Has Provided Us with Great Vision In my last article I quoted a scripture from Proverbs that states, “Where there is no vision, the people perish” (Proverbs 29:18). People and organizations need vision and leadership to navigate the constant changes in life and to be able to grow and prosper. Chuck has provided this for our Association and has done it with his own unique style. With that said, I personally thank Chuck for all that he has done for me and for our Industry. Chuck has earned his right to move on to other things in life and at the end of 2018 will retire from his role as our Association’s CEO.

Building a Plan for the Future This change is a difficult and daunting thought for most of us who have been involved with the Insurors for many years. However, change comes about in all of our lives and careers. When they take the training wheels off of your bike it is time to rely on your training and peddle hard. In addition to the leadership Chuck has given our Association for over 30 years, he has hired some key employees and worked to develop these associates to carry on the mission of Insurors. The best leaders hire, train, and develop the next generation of leaders to carry on the business. I thank Chuck for taking care of our Organization for years to come by developing a great staff and for mentoring and training a great group of Board members and Young Agents for years to come.

“C h u c k h a s provided (v i s i o n a n d l e a d e r s h i p) f o r o u r A ssociation and has done it with his own unique style.”

The Importance of Transition The Insurors Board of Directors gave full authority to our Executive Committee to conduct a search for the next CEO of our Association. The Executive Committee then interviewed and received authority by the full Board to hire and contract with Ashley Gold to become the sixth (and first female) CEO of the Insurors beginning in January of 2019. Chuck hired Ashley 11 years ago as General Counsel for the Association and

Chris Allison, CIC 21

as a legislative lobbyist to assist with our efforts on the Hill. She has been involved in every facet of the Insurors business the past decade and has been afforded great training and development by the best in the business (Chuck himself)! We are blessed to have Ashley in place to give us a seamless transition with a team that is well trained and has their finger on the pulse of our membership. Transition to the future is as important as the leadership of today. Chuck has given us that and set up a bright future for our Insurors. Our Board is strong as ever, our Young Agents program has grown to include over 400 active participants and Chuck is still a great CEO and friend. Ashley and the Insurors associates have a great grasp and direction for our Association’s future opportunities, and we are in a great position. Please thank Chuck for his continued service and encourage Ashley for our future vision. We are planning one of our largest conventions in decades for this October as we will not only be celebrating our 125th Anniversary, but will also be celebrating the career and achievements of our friend and mentor Chuck Bidek during a special dinner on the Monday night of the Convention. Please check out the full schedule and information in this issue of the magazine and on our website at www.insurors.org. I hope to see everyone there as we celebrate the many successes of our Association! u

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From Your IIABA National Director Giving Back: A Volunteer State of Mind Living in the Volunteer State, most of us have grown up with the volunteer spirit. We offer our time and talents to our church, to our children’s sports teams, to the local homeless shelter, to animal shelters and to many other local charities and groups. It’s just what we do. Being an independent insurance agent, we take pride in our communities. Giving back is vital to our success. What we view as “giving back” may even take different avenues. Sometimes it is more than time and money given to local charities, churches and activities. It means support, and that support can have many different meanings. We support the towns that trust us with their insurance needs. Another “giving back” avenue we take is supporting the businesses that we insure. That can take the route of patronizing their business, supporting their causes, or recommending the business to friends. On the flip side of this partnership, we hope that our insureds will recommend us to their friends as well. It’s all part of the “giving back” continuum.

Joining Together to Give Back On June 1-8, Trusted Choice is celebrating the generosity of our industry with the "Give Movement" week. During this week, the Big "I" is asking anyone, anywhere to give back – volunteer, host a fundraiser or be a collection site for a local charity. This week is all about small things making a big difference. They have also put together some ideas on how to participate and promote this week at https:// w w w.independentagent.com/resources/ staffdevelopment/youngagents/pages/give/ give.aspx I would encourage you to participate and promote your agency's efforts by posting them on social media with the hashtag #tcagentsgive included.

Giving Back to Our Association Along those lines, we can expand the “giving The Tennessee Insuror

back” theme from the local level to the state level. The Insurors of Tennessee’s purpose is to offer support to local members so they can better serve their public. Support from Insurors comes in different way – through lobbying efforts, by offering insurance products that fill agency needs, developing resources of continuing education for agents, and by providing information and resources that agents need. Insurors is available as a source of information to all of its member agents. If you have questions regarding new legislation, Acord forms, E&O issues or coverage questions, Insurors is there to help you. It might be through a recent publication or it might be through a telephone call or email with one of the staff members. They have access to the most current resources and can give you up-to-date information. Another huge aspect of Insurors is their government affairs work. It is vital for our State Association to represent us (the independent agent community) and our interests on the legislative front. We know what damage can occur when someone uninformed about our industry makes legislative decisions on our behalf. It is to our benefit to have Insurors representatives work to inform those in Nashville of the importance of our industry and also how their bill might affect it.

“I n s u r o r s i s available as a s o urce of information to all of its m e m b e r agents.”

With all that being said, I hope you realize the importance of “giving back” to the Insurors of Tennessee. Memberships, contributions to InsurPAC, volunteering and serving are all ways YOU can help our State Association. Through your support of Insurors, we help to keep our Association strong, which also keeps our member agents strong. We need Insurors to be strong on a larger scale so we can be successful on our local scale. I implore you to give back to the Insurors of Tennessee. They are there to work for you, but need your support to keep up the good work. If you're looking for ways to give back to Insurors, please email me at lmoraniii@inter-agencyinsurance.com and I'll be happy to discuss it. u

Lou Moran III 23

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From Your CEO Please Do Me a Favor

Ask not what your what your Association can do for you, ask what you can do for your Association. Obviously, I am paraphrasing John F. Kennedy’s inaugural address, however, the point is the power and importance of doing things as a group. In our Association we have roles for the staff, volunteer leaders and members at large. All of these roles are critical to our success. My goal is to motivate you, and all of your agency, to make your Association better. These are actions that have little or no cost associated with them, but can make us a much better organization.

Read Your Association Publications We take pride in our publications and it takes time and talent to produce them. Our bi-weekly newsletter, The Bulletin, and our bi-monthly magazine, The Tennessee Insuror, do not just appear. I am shocked when I see the statistics on how many folks don’t open the articles and just read the titles. Are you really too busy to learn? Many of the questions I get were already answered in The Bulletin, or it contained an article that could help with a claim or a possible E&O situation. And don’t forget, your membership in Insurors includes all employees in the agency. If you don’t have time, delegate learning to an employee and have them mark the “important” stuff to share with you and the others in the agency.

Meet Your Members of Congress We are often complimented on our prowess in politics, but without our members we cannot be successful. Meeting your congressman or woman is not hard. Everybody seems to be looking for new leads. You’ll find plenty of new friends by attending town halls, business clubs or school dedications. Stick your hand out and meet your Congressman at the next event and tell them that you are in the insurance business. Then, tell them you are a member of INSURORS. Make a small donation and you will have a friend for life. Someday we may be asking you to make contact with your Congressman on an important vote that not only affects you, but all agents. Each Spring we go D.C. to meet the Tennessee The Tennessee Insuror

Delegation in their offices. I would love to have you join us. I have taken hundreds of agents to meet their Congressman. Most agents have said it was quite a trip to make that visit and watch the "sausage being made." Moreover, your relationship with the Congressman will be enhanced and remembered.

Understand Your Relationship to the State You may not notice but your existence is totally dependent on the State of Tennessee. Insurance is a state-regulated industry. You are licensed by the State, pay fees to the State, rates charged for premium and rules for admitted companies are regulated by the State. Your business may be affected by two different governing bodies. The Tennessee Legislature that passes the laws, and the Department of Commerce and Insurance which administers the laws. Our job is to work with both of these bodies. You may have noticed that I did not say either group “writes the laws.” Bills come from a plethora of people who want to change the laws. That is a major task for us that begins from around November and lasts through late April. We are usually tracking 100 bills and carrying 2-3 pieces of legislation. Some are simple and some are downright scary. Many of you may remember our recent battle with the workers' comp Opt-Out legislation that we were able to kill.

“...the point is the power and importance of doing things as a gro up.”

What do I need from you? Just like with Congress, I need you get to know your State Senator and your State Representative. Yes, each citizen has one of each. I want you to know these people on a first name basis. I want you to come to Nashville once a year and introduce us to them as your lobbyists. We host a reception annually with insurance companies to bolster our relationship with legislators and we would love for you to join us. I need you to contribute to our Political Action Committees. Government Affairs has 3 components (1) grassroots – that’s you; (2) lobbyists – that’s us; and (3) a PAC – which is successful through a modest political contribution that you give us and we distribute to them. I have a

Chuck Bidek, CPCU 25

good agent friend who tells me all the time how he hates politics. I respond that it's exactly why he needs us. We win because of you. We are the largest insurance PAC. The bad news is that the accountants, bankers, realtors and doctors far outshine us. Frankly, we need more support.

INTRODUCING

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Utilize Your "Research Department" A large part of our day-to-day work is answering questions for member agencies. I do insist that the callers are members. You’d be shocked at the number of people who call us that do not belong to the Association or just want to pursue a career in insurance. So much so that the state sends us “business.” We work for you. We don’t turn away member questions. If necessary, we assemble what we call the "bad ideas committee" to come up with an official opinion to your question. These cover subjects like insurance coverages, the Tennessee code, agency management and E&O prevention. Maybe I could say you get what you pay for, but we believe that is why you pay your dues. We often write Bulletin or magazine articles from your questions because the answer benefits all members. Frankly, we have learned a lot in many disciplines over the years. What surprises me is that some members ask us questions weekly, while others we have never heard from. I surmise that everybody is happy, but I would argue that the expertise and knowledge we offer you is worth more than any dues you pay.

Attend Your Association Meetings Networking is an over-used word, but independent agents cannot survive alone. Most of our regulars at the Convention and the Agency Growth Conference met their lifelong buddies at these Insuror events. When you need to talk to someone, you often want someone who doesn’t compete with you. If I am in Memphis I’d rather speak to someone with the similar issue in Knoxville. You always want to be represented at the meeting because never know who you might meet. Our Convention brings about 80 companies and vendors to the exhibit hall. If you believe you have no need for carriers just give it a year or two. Your strategy should be to grab up every business card just in case. If you don’t have time to attend, send another person in the agency. The key here is being on the list!

Join the Leadership Team All volunteers in Insurors are independent insurance agents. This includes our Board of Directors and all of our committees. We occasionally ask a few company people to serve in ex officio roles. Each year the Nominating Committee is made up of Past Presidents who meet to consider vacancies on the Board. The President – which changes annually – appoints committees as needed. I want you to serve. Let the President or any member of the nominating committee know that you have interest in serving. Help take this 125 years old Association forward. Everybody says they don’t have time, but you will find time for what is important to you. So far, these spots have been filled by independent agents who have stood up and agreed to work for the betterment of this Association. Now might be your time! u 26

Berkley Southeast Insurance Group recognizes the need to mentor the growth of new talent and to perpetuate the Independent Agency System, as well as provide young agents with a competitive advantage. Tennessee’s Young Agents are the future of our business. That’s why we are working together for success.

2018 Exceptional Young Agents Aaron Jensen Blake Dickens Brandon Patterson Chad Richardson Clement Ledbetter Cooper Permenter Craig Moreland David Allen David Clark David Evans Drew Powell Forbes Harris Fred Vann Gabe Colwell Graylon Perkins Jamie Williams John Fritts Josh Clayton Josh Witt KC Covington Kevin Lockmiller Kevin Ownby Kevin Pomeroy Lori Carter Michael Greer Michael Novarese Neil Scott Paul Steele Rand Thomas Rebecca Shipp Richard Powell Robert Harris Stacy Woodard Stuart Oakes Taylor Ragan Tim Treadwell Trey Powell

Shafer Insurance Agency, Knoxville Harris, Madden and Powell, Memphis Ownby Insurance Services, Sevierville Swallows-Newman Insurance, Cookeville Battle Page Insurance, Franklin Harris, Madden and Powell, Memphis Swallows-Newman Insurance, Cookeville RSS Insurance, Chattanooga RSS Insurance, Chattanooga The Insurance Group, Inc., Knoxville Martin & Zerfoss Insurance, Nashville Harris, Madden and Powell, Memphis Collier Insurance, Memphis Swallows-Newman Insurance, Cookeville Westan Insurance, Martin Hardin County Bank Ins. Agcy., Savannah TIS Insurance Services, Knoxville Westan East, Johnson City The Insurance Group, Inc., Knoxville Union City Insurance, Union City V.R. Williams & Company, Winchester Ownby Insurance Services, Sevierville Commercial Insurance Associates, Inc., Nashville THW Insurance, LLC, Lebanon V.R. Williams & Company, Winchester McDaniel-Whitley, Inc, Memphis RSS Insurance, Chattanooga Martin & Zerfoss Insurance, Nashville The Crichton Group, Nashville THW Insurance, LLC, Lebanon Harris, Madden and Powell, Memphis Tigrett & Pennington, Nashville Shafer Insurance Agency, Knoxville TIS Insurance Services, Knoxville Martin & Zerfoss Insurance, Nashville Boyle Insurance, Memphis RSS Insurance, Chattanooga

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Education Calendar

The Insurors of Tennessee offers education opportunities to member agents across a wide range of insurance specialities that satisfy individuals at many different experience levels. If you are looking to further your career, seeking a professional designation, or need to satisfy continuing education requirements, check out the variety of courses available. Registration is fast and easy at www.insurors.org. More information about each class can also be found online.

CISR

Fee: $186

CE: 7

6/19 6/19 6/19 6/19

Premium Auditing: Agents Must Know CE: 2 $52 Why Agents Aren't Risk Managers CE: 3 $79 Industry: Regulations to Operations CE: 3 $79 The Law of Insurance Contracts CE: 3 $79

6/12 Agency Operations 6/13 Elements of Risk 10/2 Commercial Casualty II 10/3 Commercial Casualty II 10/4 Elements of Risk 12/4 Commercial Property 12/5 Commercial Property

Nashville Memphis Johnson City Knoxville Chattanooga Nashville Memphis

CIC

CE: 24 (Ruble 16)

Online Courses (www.iiaba.net/vu)

Nashville Knoxville Nashville Nashville

Ethics for Insurance Professionals How to Calc. Business Income in 5 Min. National Flood Insurance Program New Employee Training Course

Fee: $430

7/18-19 Ruble Graduate Seminar* 8/15-17 Commercial Multiline Institute 9/11-13 Commercial Casualty Institute 11/7-9 Commercial Multiline Institute

The National Alliance for Insurance Education & Research is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be addressed to the National Registry of CPE Sponsors, 150 Fourth Avenue North, Suite 700, Nashville, TN, 37219-2417. Website: www.nasba. org. Advanced Curriculum Rating = 20 CPE Credits. For more information regarding administrative policies such as complaint and refund, please contact our offices at 800-633-2165.

ABEN Webcasts (insurors.aben.tv) 6/5 6/5 6/5 6/5 6/5 6/5 6/5 6/6 6/6 6/6 6/8

Premium Auditing: Agents Must Know CE: 2 $52 Why Agents Aren't Risk Managers CE: 3 $79 Industry: Regulations to Operations CE: 3 $79 The Law of Insurance Contracts CE: 3 $79 Basics of Commercial Property Und. CE: 3 $79 Basics of Property Values and Co-Ins. CE: 3 $79 Torts, Negligence & Liability CE: 3 $79 E&O - Agency/Carrier Relationships CE: 2 $48 E&O - Understanding Agent Duties CE: 2 $48 D&O Liability CE: 2 $48 Cyber Insurance Deconstructed CE: 2 $48

CRM

Fee: $430

9/26-28 Principles of Risk Management*

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CE: 3 CE: 3 CE: 6 CE: 9

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Legal & Ethical Requirments of Insurance CE: 4 Insuring Flood Exposures - NFIP Review CE: 4 Available from The Institutes

$75 $75

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Insurance Principles and Policies CE: 7 Long Term Care CE: 24 Workersâ&#x20AC;&#x2122; Compensation CE: 10 Employee Benefits for Small Companies CE: 4 Healthcare Reform and Affordable Care CE: 5 e-Coverage CE: 15 Fundamentals of Personal Auto Insurance CE: 3 Management Process for Ins. Professionals CE: 21 Intro to Flexible Spending Accounts CE: 4 Terrorism and Its Impact on Insurance CE: 4 Toxic Mold and Homeowners Insurance CE: 15 Understanding the Industry of Insurance CE: 5

$49 $99 $59 $39 $49 $79 $29 $89 $39 $39 $79 $39

Indicates course is presented by The National Alliance. Register for these courses at www.thenationalalliance.com The Tennessee Insuror

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Government and Legal Affairs Give Your Agency a Spring Cleaning

Written by Ashley Gold, J.D., Insurors General Counsel As they say, spring showers bring May flowers. If you are like me you have probably spent some time in the last 6 weeks or so cleaning out closets, weeding flower beds and generally performing tasks we refer to as “Spring Cleaning.” But what about your agency? When was the last time you pulled that Employee Handbook or Agency Operations Manual out of the drawer or from under the computer monitor and gave it a thorough review? Record retention? Agency procedures? Carrier contract reviews? Let’s take a look at some agency spring cleaning ideas that could make you more productive, or at least may avoid an E&O claim. Let’s start with the basics: 1) Agents’ licensing. Are all of the proper people in your agency licensed? Are all of their licenses up to date, including making sure to notify all insurance departments of address changes? Insurance licenses are a necessary prerequisite to selling and servicing insurance policies in Tennessee. Additionally, most states require notification of any material changes, including new home addresses, and require notification of any regulatory complaint or investigation. Failure to update each state insurance department can result in hefty fines. For help managing multiple licenses in multiple states, contact Insurors’ endorsed partner KNK Compliance Services. http://www.insurors.org/IOT/Products_and_Services/KnK_ Compliance.aspx 2) Carrier contract review. When was the last time you pulled out your carrier contracts and took a look at your responsibilities, those legal duties you agreed to when you signed that contract? Here are some things to take a look at: Who

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owns the expirations of your clients’ policies? Are there any requirements in the contract to notify they carrier of a change in ownership of the agency? Have you acquired any partners since the contract was signed? What are the claims reporting requirements under the contract and do you always comply with them? IIABA reviews agency-company agreements and has a list of over 50 contracts they have reviewed with comments. These may be found at www.iiaba.net under Big I Resources/Legal Advocacy. 3) Record Retention Plan. Has your agency adopted a record retention plan? Do you actually follow it? The plan used to be simple, keep tax records for 7 years and keep agency records for the life of the policy plus the statute of limitations. However, with the changes in technology and cloud computing, as well as changes in privacy laws, record retention is more complicated. The ability to retain a vast amount of records in a small electronic space allows agencies to keep records longer, as long as they are secure from potential cyber intrusions. One of the most important guiding principles is to adopt a policy and follow it. Allowing each employee to choose their own policy will set you up for a potential E&O problem because consistency is often the key to a good defense. 4) Agency Procedures Manual. Consistency in practices and procedures regarding how business is done is a critical component in E&O claims prevention. Keep in mind that if all agency staff do not adhere to established procedures it can increase your E&O exposure and make them more difficult to defend. Consistently followed procedures will not only establish a pattern of invariable practices aiding in the defense of E&O claims but they will also improve customer service. If you have a manual, when was the last time you reviewed it

with your staff? If it still refers to paper files and typewriters, it might be time to update your manual. If you don’t have one, it is probably time to look into that. Westport policyholders have access to a Sample Procedures Manual on the E&O Happens website at www.iiaba.net/eohappens. 5) Agency Website, Social Media and Marketing. Do you ever Google a company to find out more about it before you visit, look up a new restaurant’s menu or check out customer recommendations online? If so, then you can imagine your customers and potential customers are doing the same thing to you. When was the last time you looked at your website? Does it have fresh, changing content that does not open you to E&O liability? Are potential shoppers finding you online? Or, do you have to type in your website address directly to even find yourself on the world wide web? Maybe it is time to spring clean your website and social media presence. Insurors has partnered with Titan Web Marketing that is your solution to your digital marketing needs. Additionally, Trusted Choice will offer up to $500 toward a digital review and update. Take advantage of these opportunities now https://bit.ly/2KhkKyN

YOU’RE INDEPENDENT. BUT YOU’RE NOT ALONE.

INSURORS CUTS THROUGH THE RED TAPE TO GET YOUR VOICE HEARD. HELP US WORK FOR YOU “ON THE HILL.”

About the Author Ashley Gold has served as the General Counsel of Insurors of Tennessee since 2007, and previously consulted for the Association on legal and government affairs matters. She received her undergraduate degree from the University of Kentucky and her Juris Doctor from Samford University. u

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Insurance products underwritten by Westport Insurance Corporation, Overland Park, Kansas, United States, a member of Swiss Re Corporate Solutions.

Agency Needs an SSL Certificate ...continued from page 16

Industry Innovation Committee The following Insurors members have been appointed to serve on the Industry Innovation Committee for 2018: Kym Clevenger, CPCU, CACW Co-Chair President The Assurance Center Knoxville Stephen Masterson Co-Chair Vice President Hollis & Burns Memphis Kathleen Glass Burk Member Account Executive Kemmons Wilson Insurance Group, LLC Memphis Brandon Clarke, CIC Member President John Bailey Company Knoxville Matt Felgendreher Member Executive Vice President W.C. Dillon Company Nashville Lavonda Shipley Member Property & Casualty Marketing Manager Reliance Partners Chattanooga Jamie Williams, CIC, CRM Member VP/Agency Manager Hardin County Bank Insurance Agency Savannah Cam Winterburn Member Principal Agent Winterburn & Associates Pulaski

Acuity Loves You!

Bill Emerick, CIC, CPCU, AU, ARM Ad Hoc Member Regional Vice President Penn National Insurance Nashville

PROUD Convention & Meetings Committee

TO PARTNE R W I TH TH E BE ST D EP have EN Dbeen ENappointed T AGEtoNTS I N TH E BUS I NE S S! The following Insurors IN members serve on the Convention & Meetings Committee for 2018: Bob McIntire Co-Chair Co-founder/Principal Agent McIntire Insurance and Real Estate Cleveland Christy Jones, CISR, CAPI Co-Chair 34

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Association Update

CIA Adds Taylor; Denbo Named Top Producer Commercial Insurance Associates has announced that Ryan Taylor has joined the agency as a producer. He is the recipient of numerous Top Gun and President’s Club awards at his former agencies, and he was also named the top Nashville sales leader four out of five years. In addition, principal agent Will Denbo was named as a Top Producer for 2018 by Insurance Business America. Per the article, Denbo has been among the highest grossing producers in the industry, and, "has been a key driver of both business growth and talent acquisition at CIA."

Jacobs Wins Knox County Mayoral Primary Insurors member Glenn Jacobs of Jacobs Insurance Associates in Knoxville won the Republican nomination for Mayor in the Knox County primary held on May 1st. He will now face Democrat Linda Haney in the general election August 2nd. The margin of victory in the primary race came down to just 17 votes.

Anderson Benson Adds Russell and Anderson Nashville-based agency Anderson Benson has added Sarah Anderson and Cynthia Russell as new account managers. Anderson joins Anderson Benson from Willis Towers Watson where she most recently served as a client service specialist. There she was responsible for maintaining and responding to clients for businesses across the country. Russell joins Anderson Benson from Marsh McLennan Agency where she worked as a commercial lines accounts manager. She has experience with a variety of insurance and risk management needs for businesses. She has relocated to Nashville from West Palm Beach, Florida.

BB&T Acquires Regions; Adds Golden BB&T Insurance Holdings, Inc. has continued its P&C The Tennessee Insuror

expansion with the acquisition of Regions Insurance Group and the addition of Tiffany Golden as a commercial insurance broker in the Knoxville market. Regions Insurance held a large insurance brokerage unit serving more than 60,000 clients across the Southeast, Texas and Indiana. This acquisition adds incremental balance to BB&T's insurance business between its wholesale and retail insurance channels. Following this acquisition, BB&T Insurance's retail network will contribute almost half of its insurance brokerage revenue. BB&T announced Golden's addition as part of their plans for expansion into the Knoxville market. She formerly worked with Answer Financial as a sales manager and has a Bachelor's degree in Mass Communication from UT-Knoxville.

Reliance Partners Brings on Seidl as VP Reliance Partners is pleased to announce addition of John Seidl as V.P. of Risk Services. Seidl is recognized as a leading expert in DOT commercial transportation compliance and will be strong resource for Reliance Partners’ current and future clients. As a former Wisconsin State Motor Carrier Trooper and FMCSA Investigator with more than 20 years of experience in risk services, Seidl is well versed in the transportation insurance space. He has worked at the FMCSA, FAA, and most recently as an insurance producer and DOT consultant.

Beecher Carlson Promotes Siech and Davis Beecher Carlson Insurance Services, LLC has recently announced the promotions of Joseph Siech to CEO and B. Scott Davis to the newly created position of COO. Davis will also continue his role as president of casualty and property. Siech, who was formerly national sales director, is responsible for planning and directing execution of Beecher Carlson’s client services and growth initiatives, as well as guiding the development of shortand long-term financial goals, according to a statement. Davis, based in the agency's Brentwood office, will direct strategic operational developments in his newly added role. ...continued on page 41 35

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Company Spotlight

Penn National Insurance In 1919, Penn National Insurance was founded to provide affordable workers’ compensation insurance and quickly grew into a full-service regional company. Today, Penn National Insurance sells a diverse array of business, auto and homeowners insurance through independent agents in eleven states. They’re more than $1 billion strong in assets, and rank among the top 10 percent out of approximately 1,000 U.S. P&C insurance groups (based on net premiums written). “We are all about developing relationships. Because of that, we work hand-in-hand to help our agencies grow profitably,” says Bill Emerick, regional vice president of Penn National Insurance’s Nashville office. “We are always looking for the best agents to work together to meet common goals." As a mutual company, Penn National Insurance operates solely for the benefit of their policyholders. They focus time, attention, and resources on delivering long-term superior financial strength and stability, a comprehensive product portfolio, and most of all, on doing what’s right for policyholders. To Penn National Insurance, policyholders are much more than insurance consumers. And because of that, all of the company's business decisions are made with a policyholder-first focus. This focus on customer experience for agents and policyholders has led them to develop solutions for any challenge. Penn National Insurance continuously enhances their technology and processes to provide better service and increase convenience for agents and policyholders. They want their agents to feel that they are partners in the business of protecting their policyholders. They also want their policyholders to know that the company is looking out for their best interests and they will receive consistent, high-quality service. The Tennessee Insuror

FEEL SECURE®

Innovative Products and Solutions Penn National Insurance offers a wide range of Commercial and Personal Lines products and coverages that provide their agents with opportunities to grow their book of business. They work closely with agents to continually evaluate and adapt coverages to today’s everchanging market needs. In addition to the standard lines of commercial business, the company's commercial Lines portfolio includes coverage offerings developed to meet the unique needs of different markets. Those coverages include cyber security coverage, technical professional liability coverage, contractors E&O and monoline inland marine. Their proprietary PennPac coverages provide coverages enhancements and higher limits that can be added to meet the needs of different markets. The company's personal lines products makes them an attractive, competitive carrier for homeowners, auto and umbrella coverages. In April 2016, Penn National Insurance launched their usage-based insurance program for auto insurance, making them one of the first regional insurance companies to do so. Their eSignature option is fully integrated into the agency portal where agents are able to easily initiate and manage the signing process. Penn National Insurance remains committed to distributing their products and services through independent agencies. Guided by a data-driven approach, the company is committed to developing and implementing agency management strategies and systems that position them to respond to the continuously changing environment and expectations of agents. They take pride in the quality of their underwriting, customer service and claims service teams. u

Tennessee Contacts Bill Emerick, CIC, ARM, CPCU Regional Vice President 1.800.395.0518 bemerick@pnat.com Jane Kinard, CIC, CPCU, AIS Territory Manager jkinard@pnat.com Brett Potts Territory Manager bpotts@pnat.com About Penn National Insurance Company Facts • • •

• •

Ranked 96th in net premiums written out of approximately 1,000 U.S. P&C insurance groups Employs more than 820 people. Principal lines of business are personal automobile, other liability, commercial automobile, homeowners & workers’ compensation Sells products through over 1,000 agencies in 11 states Headquartered in Harrisburg, PA, with regional and claims offices in North Carolina, Tennessee, New Jersey and Pennsylvania

Company Focus • • • • • •

Commitment to the independent agency system with strong agency relationships Competitive products and pricing Enhanced ease of doing business through intuitive, powerful automation tools Underwriting consistency in the marketplace Outstanding claims service with high customer satisfaction Knowledgeable and experienced employees 37

â&#x20AC;&#x153;Exclusive member agencies, collaborating to bring the best insurance solutions to their clients.â&#x20AC;? The Allison Insurance Group - Jackson Bagley & Bagley Insurance - Fayetteville Boyle Insurance Agency, Inc. - Memphis Burke, Powers & Harty - Bristol Carnal-Roberts Agency, Inc. - Lexington Cate-Russell Insurance, Inc. - Maryville Frank E. Neal & Company, Inc. - Nashville Goss Insurance - Hixson Inter-Agency Insurance Services - Knoxville

Martin & Zerfoss, Inc. - Nashville McInturff, Milligan & Brooks - Greeneville Miller | Loughry | Beach Insurance Services - Murfreesboro Ownby Insurance Service, Inc. - Sevierville Smith-Berclair Insurance, Inc. - Memphis S.N. Anthony, Inc. - Ripley Tigrett & Pennington Inc. - Dyersburg V.R. Williams & Company - Winchester Watauga Insurance, Inc. - Johnson City

Get more information now at www.securerisk.com

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Program Spotlight RLI PUP Updates RLI has announced that their Personal Umbrella policy (PUP) will be making some major eligibility and underwriting changes for new and renewal business with an effective date of June 1, 2018 and later. The major changes are summarized below: •

•

Drivers under the age of 20 will be eligible with one (1) incident (violation OR at-fault accident). Previously, drivers age 20-21 were eligible with one incident, while those under the age of 20 were ineligible. Drivers under the age of 22 will be eligible with basic underlying automobile limit B (250/500/50 OR 300/300/50 OR 300 CSL). Previously, drivers under the age of 22 required basic underlying automobile limit of A (500/500/50 OR 500 CSL). Up to $5M limits will be available for certain PUP Special risks. If a risk is in PUP Special due to the number of autos and/or properties (questions 1 and 2), and no other response(s) make the risk PUP Special, up to $5M limits will be available.

•

Up to nine (9) residential properties rented to others that are not occupied in whole or in part at any time will be eligible. Previously, ownership of six (6) or more of these properties was ineligible.

•

Simplification of the farm/timberland question. Previously, we asked for how many acres of timberland and/or land that is farmed.

•

Simplification of the target political figure question. In most states, appointed or elected political figures lower than the state level in a political subdivision with a population above 100,000 were previously ineligible. That distinction has been removed.

•

Increase of the prior liability loss amount for eligibility. Prior liability loss amount has been increased to $50,000 from $25,000.

Contact Stephen Holmes at sholmes@insurors.org for more information, or get more details online now at www.insurors. org/IOT/Products_and_Services/Markets/RLI/IOT/Products_ and_Services/RLI_Products.aspx u

The Markel difference Service | Strength | Specialists

Markel Specialty | markelinsurance.com markelcorp.com Markel Specialty is a business division of Markel Service Incorporated and has over 70 years of experience in niche markets, with a product focus on commercial and personal lines insurance. Policies are written by one or more Markel insurance companies. Terms and conditions for rate and coverage may vary.

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Recruiting new talent. Target marketing. Competing for new business. Perpetuation planning.

As an independent agent, the path forward isn’t always clear. With Keystone, the best resources are at your fingertips to help you carve out clarity from our industry’s complexities. We connect you to a community of like-minded independent agents, provide access to relationships that extend beyond your geographic reach, and employ the expertise that expands opportunities for you and your clients.

Success is a journey. Let us be your guide.

Contact Michele Bicknell: 570.473.2148 mbicknell@keystoneinsgrp.com keystoneinsgrp.com

Because independence works better together. ©2018 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.

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Association Update (cont.)

Moran Receives Webb School Service Award

Insurors IIABA National Director and Inter-Agency Insurance service principal Lou Moran III was recently awarded with The Robert Webb Service Award by The Webb School of Knoxville. The award, established in honor of school founder, Robert Webb, recognizes a member of the alumni body who has distinguished him/ herself through outstanding service and leadership.

Bryan Joins THW Insurance Services Lebanon-based THW Insurance Services, LLC, has announced that local banker John B. Bryan has joined their firm as a licensed agent. Bryan comes to the agency from CedarStone Bank, where he served more than eight years as VP and business development officer as well as marketing director.

role, Guercio will be responsible for successfully integrating agency acquisitions and achieving overall operating excellence throughout the existing platforms and offices.

Big "I" Adds Cortina to Gov. Affairs Team The Big “I” recently announced that Joseph Cortina has joined their Capitol Hill team as a director of federal government affairs. He joins the association’s bipartisan lobbying team primarily as a liaison to Democrat congressional offices. Cortina comes to the Big “I” from the office of House Democratic Whip Steny Hoyer (D-Maryland). He earned his BA in political science from the University of South Carolina.

Caruso Retires from Gallagher

AssuredPartners Names Guercio as EVP AssuredPartners, Inc. recently announced that Joe Guercio, CIC, AAI, CPA will assume the role of VP of Operations. In this

After more than 43 years in the industry, area president of Gallagher, Frank Caruso retired on May 31st. Caruso started his career as a marketing consultant for Aetna in 1975. He joined Gallagher in 2000 to help build their Tennessee and Kentucky region. He is a former president of the Insurors of Nashville local board. u

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Company Briefs Big "I" Presents Best Practices Carrier Awards The Best Practices Awards of Excellence recognize insurance companies for their exceptional efforts in promoting and marketing Best Practices tools, seminars and philosophies throughout the year. At the 2018 Big “I" Legislative Conference General Session Breakfast, Bob Rusbuldt, Big “I" president & CEO, presented Best Practices Awards of Excellence to Applied Systems, Central Insurance Company, Chubb Insurance Companies, EMC Insurance Companies, Nationwide Insurance and Westfield, for their efforts in utilizing Best Practices data and raising awareness of Best Practices standards and other Big “I" initiatives.

Safeco Appoints New RGM for the Southeast Safeco Insurance recently announced that Debra Pooley has been appointed Vice President and General Manager for the Southeast Region. She replaces Carl Canales who has been named Vice President and General Manager for the Northeast Region.

Debra, who most recently served as Regional Operations Manager for Safeco in Suwanee, GA, is a CPCU and CPA, and brings a wealth of experience to her new role. A Georgia native, she has worked extensively to support independent agents, and is a natural fit to lead Safeco’s field operations team in the region.

Main Street America Group Pursuing Merger The Main Street America Group’s board of directors has approved plans to pursue a merger with Madison, Wisconsinbased American Family Insurance, a Fortune 500 company and the nation’s 13th largest property/casualty insurance carrier. Main Street America will become the company’s partner to distribute products through independent agents. The agreement, which is subject to regulatory and policyholder approvals, is expected to be finalized by the end of the year. Main Street America has confirmed that they will remain an independent agent company and serve that channel. They have also stated their continued support for the Big "I"

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through a statement from CEO Tom Van Berkel, "Main Street America will retain its affiliation and strong support of Trusted Choice®, the global branding program of the Independent Insurance Agents & Brokers of America."

the new CNA Center, located at 151 North Franklin Street in Chicago's Loop business district. CNA Center will officially become the company's modern, global headquarters on June 1, 2018.

Van Berkel will join the board of American Family, and continue as CEO of Main Street America for the next two years. There are many other details, some of which are still being completed and are confidential.

CNA's Chicago Branch employees are among the first of 1,700 employees moving to the company's new corporate headquarters.

EMC Launches New Brewery/Winery Program EMC has announced new industry–specific coverage and extensive loss control services for breweries and wineries. The new insurance program is customizable, giving breweries and wineries the right coverage at the right price. Specialized coverages for buildings, businesses’ personal property and the personal property of others are available. Other highlights of coverage include beverage contamination, key employee replacement expense, processing errors, product withdrawal expenses and tank collapse and leakage. View more information at https://www.emcins.com/businessIns/breweriesWineries/

CNA Announces Relocation of Chicago Branch CNA has announced the relocation of its Chicago Branch to

Swiss Re Creating Standalone E&S Unit Swiss Re Corporate Solutions has announced the creation of a standalone excess and surplus (E&S) business unit in North America. This unit will include Swiss Re’s traditional E&S property and E&S casualty groups, which will be fortified with the addition of multiple lines of business in the near future. Ella Broks has been appointed head of E&S Sales North America.

Star Insurance Launches New 3-Year BOP Star Insurance Company, a division of AmeriTrust, has announced the launch of a new comprehensive Business Owners Policy (BOP) product for a wide variety of classes at competitive rates. Features of the BOP include a multi-year policy capability with locked-in rates. Coverage highlights include property values up to $5 million and sales up to $6 million. For more information, please contact Keller Chapman at keller. chapman@starinsco.com. u

Preferred Property Program can help you procure Umbrella coverage for your insureds with an AXV A.M. Best rated carrier for the following types of risks: Developer Sponsored Boards Master Associations High-rise Associations & Apartments to 35 stories are eligible and more Limit options ranging from $5 million to $50 million Coverage can include excess D&O ● General Liability ● Auto ● Employee Benefits Employers Liability, Including Employment Practices Liability* (*if covered under the D&O) Follow Form EPLI is available only up to $25 Million limit

In 2016 we partnered with American Union Risk Underwriters (AURA) located in Florida. With our new partner we can now also offer our comprehensive Umbrella, with unsurpassed service and for the following types of risks: Hotels ● Motels ● Timeshares ● Lessor’s Risk Enclosed Malls Shopping Centers Retail ● Office Buildings ● Warehouses ● Light Industrial Apartments Limit options ranging from $5 million to $100 million For information on our AURA program, contact our experienced underwriter Tom Clementi at 877-506-1430 or visit our website, www.aurains.com A subsidiary of

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Let’s Build Business Together MidSouth Mutual provides workers’ compensation insurance and services to agencies and their clients throughout the Southeast and beyond. Our market reach is expanding to better serve your clients. The states we serve are listed below. Alabama, Arkansas, Georgia, Indiana, Kentucky, Mississippi, Nebraska, North Carolina, Tennessee, and Oklahoma

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Important Issues... • • • • •

• • • •

...continued from page 8

Creating an enterprise market data strategy and analytics data warehouse; Rebuilding the NAIC Consumer Information Source (CIS) to provide an improved consumer‐driven experience and enhanced educational materials; Developing the NAIC InsureU website into a leadingedge resource for consumer education on insurance related‐related topics; Engaging regulators in educational events and forums to stay abreast of rapidly evolving insurance products and services; Convening an Autonomous Vehicle Insurance Forum to discuss insurance regulatory issues with automakers, motor vehicle administrators, the U.S. Department of Transportation, safety advocates and others; Using the NAIC Center for Insurance Policy & Research (CIPR) to enhance focus on insurance regulatory innovation; and Creating a Cybersecurity Insurance Institute. The third major theme is Superior Members Services and Resources. There are two goals underlying the theme: Provide optimal services to support state insurance regulators, and equip them with the necessary talent and resources; and Optimize the efficiency and effectiveness of the NAIC structure to focus on member priorities and maximize member engagement.

Some of the work product expected includes: • • • • • • •

Outreach by NAIC staff to all members to identify training needs; Keeping cybersecurity as a top priority and continuing to build out the NAIC cybersecurity framework; Improvements to the user experience of NAIC technology services; Transformation of platform and development practices; Fostering a culture for innovation and continuous improvement; Addressing NAIC and state regulator talent and resource needs; Conducting a review of the committee structure and reducing the number of active groups to better focus on

•

priorities; and Developing appropriate governance factors to ensure a balance between effective engagement and efficiency.

As you can see State Ahead is forward looking and innovative. It outlines broad themes, objectives and goals to pave the way toward our future success. I am proud of the efforts and dedication of our members to implement this strategic plan as we move forward.

Cybersecurity Initiatives Cybersecurity is perhaps the most important topic for the insurance sector today. It is incumbent on insurers and insurance producers to protect the highly sensitive consumer financial and health information collected as part of the underwriting process and for evaluation and payment of insurance claims. This Personally Identifiable Information (PII) is entrusted to the industry by the public. The public has the right to demand it be protected to the maximum extent possible. The NAIC has completed several cybersecurity activities in recent years. Late last year a significant accomplishment was the adoption of the Insurance Data Security Model Law. State insurance regulators also participated in a joint forum with Stanford University on cybersecurity activities. In this section I will discuss my views on the Model Law, the possibility of developing a Cybersecurity Institute and activities related to anti‐fraud efforts. Implementation of Insurance Data Security Model Law: In October 2017, the Insurance Data Security Model Law was adopted. The Model Law requires insurers and other entities licensed by state insurance departments to develop, implement, and maintain an information security program; investigate any cybersecurity events; and notify the state insurance commissioner of such events. States are now working to introduce the Model Law in their legislatures. The state regulatory system allows us to be close to the people and businesses operating in our jurisdictions and adjust laws and regulations to protect insurance consumers within our boundaries. I believe cybersecurity is an area where we need to recognize diversity is not the answer. A data breach is a data breach regardless of where it happens. As a result,

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Not all markets are available in all states

instead of diversity, cybersecurity matters call for a uniform solution. I am convinced we have a workable uniform solution for the insurance sector with the Insurance Data Security Model Law. In an extraordinary step forward, the development of the Model Law was recognized by the U.S. Department of the Treasury in its October 2017 report titled, A Financial System That Creates Economic Opportunities: Asset Management and Insurance. In the report, the Treasury states: “Treasury recommends prompt adoption of the NAIC Insurance Data Security Model Law by the states. Treasury further recommends that that if adoption and implementation of the Insurance Data Security Model Law by the states do not result in uniform data security regulations within five years, Congress pass a law setting forth requirements for insurer data security, but leaving supervision and enforcement with state insurance regulators.”1 Creation of Cybersecurity Institute: In a remarkable speech given at the NAIC/Stanford University Joint Cybersecurity forum on October 11, 2017, Richard A. Clarke, a former U.S. National Coordinator for Security, Infrastructure Protection and Counter‐Terrorism, recommended a cybersecurity institute be formed in the insurance sector. Creation of a cybersecurity insurance institute would be quite an undertaking. Among the things it might include are: • • • • •

• • • •

Collection and cataloging of data on cyber breaches; Studying cybersecurity breach events; Providing information on cyber risk mitigation; Serving as the “Underwriters Laboratory” for cyber risks; Development of an educational component encompassing the development of educational and instructional materials to provide students with a comprehensive education on cybersecurity matters; Creation of a multilevel set of certifications granted for successful completion of educational courses; Provision of high quality continuing education for those with certifications; Creation of a Federated Digital Identity to replace current use of PII for identity verification purposes, making PII valueless to hackers; and A process for continuous tracking of cybersecurity risks.

I am hopeful we can consider the creation of a cybersecurity insurance institute this year and come to some agreement on its scope. The scope might include some of the items listed above and other innovations and ideas not yet contemplated.

Closing Remarks Regulatory compliance and sound corporate governance go hand‐in‐hand. For state insurance regulation to be successful we need to promote safe and sound insurers operating in a culture of sound corporate governance and we need to encourage healthy competitive environments to provide choices to insurance consumers. We need to encourage innovation 48

while keeping consumer protection front‐of‐mind. What might have been considered science fiction a few years ago is now reality for us today. Artificial intelligence (AI) is changing the world as we know it and impacting our future. Advances in health care are being made allowing doctors to diagnose and manage new diseases even before the symptoms are detected. This has implications for the cost and quality of health care delivered to Americans. As regulators we need to stay in front of these developments and monitor the impact on health insurers and health insurance. Eventually AI might be used to discover and catalog risks in all areas. Using AI technology to extract new risk and cyber‐ threat intelligence from large volumes of unstructured and structured data offers amazing potential for us to operate in a safer, more secure world. State insurance regulators might be able to use Big Data and predictive analytics to monitor insurer market performance and nip consumer abuses in the bud. AI offers tremendous potential in guarding against fraud. We also need to understand how these tools are being used by insurers so we can work with them to keep rates fair and claim settlement practices above board. Our State Ahead strategic plan provides us with a roadmap for success. I appreciate all the support of NAIC members, consumers, the industry and our staffs as we move this plan from concept into action. Working together we can – and will – make a difference. To view the full article, please visit http://www.naic.org/cipr_ newsletter_archive/vol24.pdf?96 1 - per "A Financial System That Creates Economic Opportunities: Asset Management and Insurance" via U.S. Department of the Treasury - October 2017

About the Author Commissioner Julie Mix McPeak was appointed by Governor Bill Haslam to lead the Tennessee Department of Commerce and Insurance in January 2011. Before being named to lead the department, McPeak practiced as Counsel to the insurance practice group of law firm Burr & Forman LLP. She also served as the Executive Director of the Kentucky Office of Insurance (KOI). Before her appointment as Executive Director, she spent nine years as an attorney for KOI, the final five as general counsel. She also served as general counsel to the Kentucky Personnel Cabinet. McPeak brings more than 20 years of legal and administrative experience in state government. She is the first woman to serve as chief insurance regulator in more than one state. Her leadership as TDCI Commissioner garnered recognition from Business Insurance Magazine which honored her as one of the 2013 Women to Watch. McPeak currently serves as the president of the NAIC. McPeak received her J.D. from the University of Louisville, School of Law in 1994. She is a 1990 graduate of the University of Kentucky, where she received her B.B.A., With Distinction, in Marketing. u The Tennessee Insuror

The Tennessee Insuror

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Meetings

Those Summer Days (and Meetings) are Almost Here Big "I" Leadership Conference August 22-26 The Big "I" Fall Leadership Conference will take place August 22-26 at the Sheraton Springfield Monarch Place Hotel in Springfield, Massachusetts. The event will feature the Big "I" Executive Committee meeting, Education Convocation, Young Agents Leadership Institute and Board of Directors meetings. Other meetings include the Diversity Task Force and the Trusted Choice Committee. View more info now at https://www.independentagent.com/Events/FallLeadership/ home.aspx

NAIC Insurance Summit June 18-22

Could your agency weather a data security breach? A full 80 percent of businesses that experience one donâ&#x20AC;&#x2122;t.1 The right insurance can keep your agency from becoming part of this startling statistic.

The Insurance Summit is a premier insurance conference in for insurance professionals regulators, companies and startups. The conference brings together innovators and regulators to explore the newest ideas, the latest technology and the future of regulatory practices.

Data breaches are common among smaller businesses, and responding to a breach is both costly and complex.

The event will take place June 18-22 in Kansas City. View more info or register now at http://www.naic.org/insurance_ summit/index.htm

You are obligated to protect the data you collect, and package policies are often not enough.

ELEVATE Conference 2018 June 24-26

Make sure your agency has the right coverage in place to protect you and your insureds.

Elevate 2018 is an epic, 2-plus day event exclusively for the independent insurance community. Join TrustedChoice. com's Agency Nation in the metropolis of Cleveland June 24-26 to superpower your tactics, amplify your agencytude and fuel your futureâ&#x20AC;&#x201D;and leave feeling like a superhero! Get more information now at elevateconference.com

Contact your Insurors E&O Specialist, Stephen Holmes, CIC, CISR, for information on Data Breach coverage.

125th Anniversary Convention October 27-30 The Insurors of Tennessee 125th Anniversary Convention will take place October 27-30 at the Omni Hotel in downtown Nashville. The event will feature exhibits, education, guest speakers, entertainment and events geared to enhancing the experience and success of Tennessee's Independent Insurance Agent & Broker community. Register now or get more information by visiting http://www. insurors.org/IOT/Convention/IOT_Convention_Home.aspx or reserve your room now at https://www.omnihotels.com/ hotels/nashville/meetings/insurors-of-tennessee-annualconvention u The Tennessee Insuror

1. Privacy Rights Clearinghouse: Chronology of Data Breaches

Stephen Holmes, CIC, CISR sholmes@insurors.org 615.515.2609

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The Tennessee Insuror

Member Tips

Give Your Agency the Best E&O Protection Available

written by Stephen Holmes, CIC, CISR

You don’t mess around when it comes to protecting your clients. Why would you mess around when it comes to protecting your own agency? Westport Insurance (rated A+ Superior by A.M. Best) is backed by Swiss Re Corporate Solutions and features an industry-leading Errors & Omissions policy form. The policy is built with valuable insight from independent agencies like yours, and has been nationally-endorsed by the IIABA for over 25 years. In addition, you have an experienced, prompt, and knowledgeable staff right here at Insurors of Tennessee to make sure you and your agency are properly protected. Knowing you are with the best lets you focus on what you are truly here to do – serve your clients. Coverage highlights include: • • • • • • • • • • •

State of the art coverage form exclusive to Big “I” Members Pure claims made coverage (not claims made and reported) Broad definition of covered professional services and activities Comprehensive definition of insured, including independent contractors Defense costs outside the limit of liability Exclusive deductible reduction feature with no limit on the number of claims it can potentially apply toward Both 1st and 3rd Part Personal Data Breach Coverage 60/40 softened consent to settle (hammer) clause Additional coverages for subpoena, regulatory defense, catastrophe extra expense, and crisis management 10% credits available for risk management and agency operational reviews. Risk Management tools via the E&O Happens website and E&O Claims Advisor Newsletter

Get in touch with me today and I will do a quick, nonexhaustive policy comparison between your current coverage and Westport’s exclusive Risk Purchasing Group policy form for member agencies. About the Author Stephen Holmes, CIC, CISR is the E&O Specialist for Insurors of Tennessee and has been in the industry since 2004. He earned his Bachelors degree from UTKnoxville. He can be reached by email at sholmes@ insurors.org or by calling 615.515.2609. u

Directory of Advertisers Advertiser

Phone

Website

Page

ACUITY (920) 458 - 9131 www.acuity.com 34 Amerisafe (800) 897 - 9719 www.amerisafe.com 45 AmTrust North America (877) 528 - 7878 d14.amtrustinsurance.com 17 Applied Underwriters (877) 234 - 4450 www.auw.com/us 2 Arlington/Roe (800) 878 - 9891 www.arlingtonroe.com 13 Bailey Special Risks, Inc. (800) 768 - 7475 www.bsrins.com 22 Berkley Southeast Insurance Group (615) 932 - 5508 www.berkleysig.com 26 Berkshire Hathaway Guard Insurance Cos. (800) 673 - 2465 x4567 www.guard.com/apply 9 Builders Mutual (800) 809 - 4859 www.buildersmutual.com 24 Burns & Wilcox (800) 341 - 4844 www.burnsandwilcox.com 15 Caliper (609) 524 - 1200 www.iiaba.net/caliper 50 Delta Dental of Tennessee (888) 281 - 9396 www.deltadentaltn.com/brokers 13 Donegal Group (800) 277 - 7442 www.donegalgroup.com 7 FCCI Insurance Group (800) 226 - 3224 www.fcci-group.com 16 Genesee General (800) 282 - 8755 www.geneseeins.com 24 Harford Mutual (800) 638 - 3669 www.harfordmutual.com 42 INSBANK (866) 866 - 4268 www.insbanktn.com 11 InsurPACTN (800) 264 -1898 www.insurors.org 32 Insurance Associates of America (866) 789 - 9712 www.iaanetwork.com 47 J.M. Wilson (800) 595 - 0063 www.jmwilson.com 43 Keystone Insurers Group (800) 416 - 5498 www.keystoneinsgrp.com 40 KNK Compliance Services (615) 375 - 7419 www.knkcompliance.com 9 Markel Specialty (615) 967 - 5515 www.markelcorp.com 39 Martin & Zerfoss (615) 297 - 8500 www.martinzerfoss.com 36 MidSouth Mutual Insurance Company (615) 379 - 8245 www.midsouthmutual.com 45 The National Alliance (800) 633 - 2165 www.scic.com 55 National Security Group (800) 239 - 2358 x213 www.nationalsecuritygroup.com 41 Nationwide Insurance (423) 927 -2060 www.nationwide.com 30 Penn National Insurance (800) 395 - 0518 www.pennnationalinsurance.com 56 Preferred Property Programs (888) 549 - 2465 www.umbrellaprogram.com 44 RLI PUP (615) 515 - 2609 www.insurors.org 19 Securerisk (770) 723 - 8096 www.securerisk.com 38 Summit Holdings (800) 971 - 2667 www.summitholdings.com 32 Swiss Re Lawyer's Professional Liability (630) 213 - 9952 www.bigimarkets.com 33 Titan Web Marketing Solutions (615) 890 - 3600 www.titanwms.com 20 Work at Home Vintage Experts (646) 807 - 4372 www.wahve.com 52 West Bend Mutual Insurance Co. (800) 236 - 5010 www.thesilverlining.com 15

T H E N A T I O NA L A L L I A N C E I N F O M A P

Map your career track and customize your learning experience by selecting the designations and course offerings that fit your needs.

Rubles CIC

CISR Introductory Series

T H E NA T I O NA L A LLI A NC E I NF O MA P

Map your career track and customize your learning experience by selecting the designations and course offerings that fit your needs.

Rubles CIC

CISR Introductory Series

CRM

Dynamic Series

WTH Seminars

CSRM CPRM

The Introductory Series is a good choice for those interested in finding out more about the industry and industry fundamentals. The Dynamics Series, offers career-changing sales training. Providing a variety of pertinent topics, the William T. Hold Seminars are invaluable for expanding your insurance knowledge. The Dynamics Series can be used to meet update requirements across the designations. WTH Seminars satisfy update requirements for CISRs and CSRMs.

The Certified Insurance Service Representative (CISR) designation provides quality insurance education geared toward customer service representatives, account executives, servicing agents, new producers, and other professionals. The Certified School Risk Manager (CSRM) designation fills a need for quality risk management education for those associated with schools.

The Certified Insurance Counselor (CIC) provides an in-depth, practical approach to education for agents and other insurance practitioners. The Certified Risk Manager (CRM) designation is recognized as being the foremost education available in the field of risk management. The Certified Personal Risk Manager (CPRM) designation yields the best training for meeting the needs of an affluent clientele.

The James K. Ruble Seminars are advanced programs that offer a variety of specialty topics. CICs, CRMs, and CPRMs can meet their annual updates with a Ruble seminar.

Dynamic Series

CRM

WTH Seminars

1 CSRM

2 The Introductory Series is a good choice for those interested in finding out more about the industry and industry fundamentals. The Dynamics Series, offers career-changing sales training. Providing a variety of pertinent topics, the William T. Hold Seminars are invaluable for expanding your insurance knowledge. The Dynamics Series can be used to meet update requirements across the designations. WTH Seminars satisfy update requirements for CISRs and CSRMs.

CPRM

3 The Certified Insurance Counselor (CIC) provides an in-depth, practical approach to education for agents and other insurance practitioners. The Certified Risk Manager (CRM) designation is recognized as being the foremost education available in the field of risk management. The Certified Personal Risk Manager (CPRM) designation yields the best training for meeting the needs of an affluent clientele.

The James K. Ruble Seminars are advanced programs that offer a variety of specialty topics. CICs, CRMs, and CPRMs can meet their annual updates with a Ruble seminar.

VISIT SCIC.COM FOR MORE INFORMATION OR INSURORS.ORG TO REGISTER FOR CLASSES NOW

2500 21st Avenue South Suite 200 Nashville, TN 37212

We answer to main street, not Wall Street. We answer to main street, not Wall Street. As a mutual company, we are owned by our policyholders. We focus our

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We answer to main street, not Wall Street. time,made attention, resources on delivering superior financial strength and are with aand policyholder-first focus. stability, a comprehensive product portfolio, and most of all, on doing whatâ&#x20AC;&#x2122;s right for policyholders. To us, policyholders are much more than

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Bob Reeder ext 7545 For more information about our products, please contact one of our territory managers at 615-889-2740.

www.PennNationalInsurance.com Brent Potts ext 7514 Jane Kinard ext 7518