Main Street Industry News - January 2018

INSIDE How Commercial Insurance is Rated by Consumers » 7 Special Report: The PIA, Cyber Risk, Cyber Concerns » 12 Errors and Omissions: Avoid Gaps When Moving an Account » 19 Update: Crisis — California’s Oroville Dam » 25

Cover Image: TumblingRun, Winters Last Gasp

January 2018 | Published Monthly

Andy Kraus, CPCU | Vice President of Agencies | 800.742.7433 | akraus@fmne.com

fmne.com

Did you know that PIA’s company council, The PIA Partnership, has conducted nationwide research about the insurance buying preferences of small business owners?

The research is encouraging because it found that small business owners strongly prefer independent insurance agents as they make choices in today’s online world.

However, the results also serve as a wake-up call that agents must take steps to continue to demonstrate their value and also be more engaged online.

PIA and the companies belonging to The PIA Partnership have created a public website that helps agents understand PIA’s findings.

PIA members also have access to a private website containing a series of strategies and tools to help them stay ahead of online competition in commercial lines.

To access the newest PIA Partnership project, Small Business Insurance & The Internet — The Voice of the Commercial Lines Customer, visit us at www.pianet.com/voiceoftheclcustomer.

If you are not a PIA member and want to access all of the tools available through this program, contact us for a membership application or visit us online at www.pianet.com/joinpia.

National Association of Professional Insurance Agents 400 N. Washington St., Alexandria, VA 22314-2353 www.pianet.com | membership@pianet.org | (703) 836-9340

How Commercial Insurance is Rated by Consumers | 7 Commercial insurance customers are generally satisfied with commercial insurers.

Catastrophe in 2017 was Catastrophic | 9 The Federal Emergency Management Agency (FEMA) released its year-end catastrophe statistics last week.

2017: Mergers & Acquisition Numbers Skyrocket | 10 OPTIS Partners does a report every year on the number of mergers and acquisitions in the industry.

Last year deals in the United States and Canada set records.

Special Report: The PIA, Cyber Risk, Cyber Concerns | 12 Every week as we go through our news sources, the PIA staff runs across a half-a-dozen or more stories on cyber concerns, cyber insurance, cyber attacks and so on.

The Wells Fargo Saga May Not be Over | 14 President Trump has waded in on Wells Fargo’s multiple scandals. You remember the forced insurance, the mortgage fee overcharges and the fake bank accounts. If you don’t Trump does.

Morgan Stanley: An Insurance Tax Reform Perspective | 16 The impact of the now-called Trump tax cuts is still being analyzed. For insurance it will likely be a good thing and with the pass-through income changes, a huge percentage of independent insurance agents will benefit.

Retiring Soon?

The Best & Worst States for Retirement | 20 Somewhere in middle-age we tend to start talking about what we’d like to do when we retire and where we’d like to live. The goal for retirement is to find comfortable and affordable places with plenty of activity available. Other factors strongly considered are low taxes, access to excellent health care, nice weather and low crime rates.

The Hartford Sells Annuities Business | 21 The Hartford Financial Services Group is selling its annuities and the $100 billion book of business it contains.

Update: Crisis — California’s Oroville Dam | 25 Oroville, California is home to the tallest dam in the United States. Earlier this year a broken spillway caused the evacuation of close to 200,000 people as officials feared a total collapse.

PIA NE IA EVENTS Professional Insurance Agents NE IA and The National Alliance Nebraska and Iowa CIC & CISR Designation | 24 Upcoming Events Calendar 2018 | 26

ADVERTISEMENTS

Trump Backpedals on Crop Insurance | 17 PIA National supports the Federal Crop Insurance Act of 1980 (FCIP). It relies on the independent insurance agent to deliver the insurance to the insureds and since the Act’s implementation, the program has thrived.

Errors and Omissions: Avoid Gaps When Moving an Account | 19

By Curt Pearsall, CPCU, AIAF, CPIA President — Pearsal Associates, Inc. and Spedcial Consultant to the Utica National E&O Program

January 2018 | Main Street Industry News | www.pianeia.com | 4

Contact us to place an ad. Cathy Klasi, Executive Director (402) 392-1611

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9-A-2507 Ed 12-15

IS YOUR E&O X-DATE HERE? PIA FOR NEBRASKA AND IOWA PIA Association for Nebraska and Iowa is committed to focusing its resources in ways that cast the most favorable light on its constituents. We are dedicated to providing the type of programs, the level of advocacy, and the dissemination of information that best supports the perpetuation and prosperity of our members.

We pledge to always conduct ourselves in a manner that enhances the public image of PIA and adds real value to our members.

SUBSCRIBE OR COMMENT Professional Insurance Agents NE IA Attention: Editorial Main Street Industry News 920 S 107 Avenue, Ste. 305 Omaha, NE 68114 Email: office@pianeia.com Ph: 402-392-1611 www.pianeia.com

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E&O Coordinator Steve Bailey

TOP STORIES

How Commercial Insurance is Rated by Consumers Commercial insurance customers are generally satisfied with commercial insurers.

Their approval rating — says the J.D. Power 2017 Large Commercial Insurance Study — went up over 2016’s survey. The reason is because of renewed focus on more tailored and diversified products.

The thumbs up comes from 2,500 very happy risk professionals who say insurance companies are working harder to understand the needs of their clients.

Here’s how satisfaction is graded in the fourth annual study: • Service interaction • Program offerings • Price • Billing process • Claims

RIMS — Risk Management Services — conducted the survey and graded each item on a 1,000 point scale. Here’s the top three insurers: 1. XL Catlin — 806 2. Chubb — 783 3. The Hartford — 772 The top three brokers: 1. Lockton — 856 2. Arthur J. Gallagher — 855 3. Aon — 822 J.D. Power spokesman David Pfeiffer said, “Amid a sustained period of stagnant rates, top-performing large commercial insurers have set themselves apart from the competition by offering a wider variety of coverage options and services to meet the specific risk needs of their

Insurance brokers and agents are graded in nine areas: • Quality of advice and guidance • Reasonable fees • Ease of renewal • Effectiveness of risk control services • Variety of program offerings • Effectiveness of program review • Price • Given services received • Billing and payment process • Claims process January 2018 | Main Street Industry News | www.pianeia.com | 7

TOP STORIES customers. While we expect rates to start rising in certain catastrophe-exposed lines for 2018 after the heavy catastrophic losses experienced during the 2017 hurricane season, the customer expectation for tailored product offerings has now become a critical part of the business insurance product mix.”

Here are some other things found in the survey about insurers: • The average score for large commercial insurers is 761.

• That’s up 7% over 2016 • That jump is due mostly because of a 10% increase in satisfaction with program offerings • Cyber insurance premiums hit $1.35 billion in 2016 — up 35% from 2015

• However, cybercrime programs are among 2017’s lowest rated programs averaging 7.26 on a 10-point scale Findings about insurance customers: • Commercial insurance customers aren’t likely to become advocates • Whether a consumer will recommend an insurance product or service is much lower than for services like business utilities or personal auto insurance • Commercial insurance consumers are very impressed with insurers they believe completely understand their business • Their average is 827 and a 141-point improvement over 2016 • Compare that to 686 for those perceived as not understanding Source: My New Markets

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TOP STORIES

CATASTROPHE IN 2017 WAS CATASTROPHIC The Federal Emergency Management Agency (FEMA) released its year-end catastrophe statistics last week. A staggering 8% of the U.S. population was impacted by a catastrophe of some kind in 2017. The 8% translates to 25 million people.

FEMA

Was involved in 59 major disaster declarations.

16 emergency declarations.

It was — indeed — a busy year. There were 17 named storms and 10 became hurricanes. Six were major hurricanes including Harvey and Irma which became the first two major hurricanes to hit the continental U.S. in a dozen years.

Wildfire ripped through the Western U.S. especially California where two fires — the Tubbs Fire in Northern California and the Thomas Fire farther south — wreaked havoc on the local populations and the state’s economy.

The FEMA run National Flood Insurance Program (NFIP) shelled out $8 billion in flood insurance claims and that’s just so far. It’s also the year in which FEMA transferred more risk to the private sector and it received $1.042 billion to help pay claims.

As for other disasters, FEMA paid out $7.2 million in assistance to individuals and to the public in general. Close to five million households applied for assistance. Billions were also sent to public agencies and to states, local governments and tribal and territorial governments to rebuild the infrastructure from storm and disaster damages.

Reinsurer Munich Re put out its own disaster statistics and said total losses worldwide last year — insured and uninsured combined — hit $330 billion. It’s the second worst year in history and the year it doesn’t beat is 2011.

Munich Re Corporate Climate Center’s Ernst Rauch said, “We have a new normal 2017 was not an outlier.”

Both Munich Re and Swiss Re tab global losses for insurers as very high. Swiss Re says around $136 billion and Munich Re puts losses at $1 billion less and $135 billion. It is the third highest catastrophe insurance loss year on record.

The United States was hardest hit.

Sources: Insurance Business America, Business Insurance, Insurance Journal, Reuters

January 2018 | Main Street Industry News | www.pianeia.com | 9

TOP STORIES

2017

Mergers and Acquisition Numbers Skyrocket

OPTIS Partners does a report every year on the number of mergers and acquisitions in the industry. Last year deals in the United States and Canada set records. No. Wait. Shattered records would be a better way to put what happened.

In 2017 there were 604 deals. OPTIS spokesman Timothy Cunningham said that’s up 31% from the 461 in 2016. “This whopping increase exceeded expectations. We expect the beat to go on in 2018,” he said.

January 2018 | Main Street Industry News | www.pianeia.com | 10

TOP STORIES The OPTIS report covers agencies that sell property and casualty insurance, agencies that sell employee benefits and agencies that primarily sell both. Last year private equity and hybrid buyers accounted for 382 of the 604 transactions. That’s 63% of the total and compares to that same group gobbling up 56% of the transactions in 2016.

“The concentration of PE /hybrid buyers has grown steadily since we began tracking deals in 2008 when only four of the top 10 buyers had private equity backing,” Cunningham said.

TOP 5 BUYERS Buyer Acquisitions Acrisure 92 Hub International 49 Alera Group 38 Broadstreet Partners 32 Gallagher 30 All but the publicly owned Gallagher are in the PE/hybrid category.

• Privately owned brokerages had 128 transactions and 105 unique buyers.

• That’s up from 114 from 87 different buyers in 2016.

• Like the year, this category set records for the number of deals and the number of unique buyers.

• Property and casualty agencies — by seller type — dominated and accounted for 301 of the 2017 transactions or 49.8% of the total.

• Employee benefit brokers made 174 transactions — or 28.8% of the total.

• That’s a 90% jump from 2016.

Cunningham said, “The explosion in employee benefits agency sales was fueled by Alera, Acrisure, and several other active acquirers.”

Two other categories are agencies selling both P&C and employee benefits. There were 86 such deals last year and in the “other” category — managing general agents, third-party administrators, etc. — there were 43 sales.

Agencies selling both property/casualty and employee benefits coverages were sold in 86 deals last year.

OPTIS Partners’ partner Daniel P. Menzer had some important observations about last year.

• Inventory is still high and many sellers are interested in moving forward • Third parties have more money to purchase an agency than internal perpetuation • Few agencies owners will leave that money on the table • Easy access to capital makes it easy for buyers to buy • Investors and lenders are willing to fund the PE/Hybrid buyers • Those buying ought to pay attention to cash flow and make sure they don’t overpay • Sellers ought to take advantage of strong pricing before things change One last comment from Cunningham. He said the actual number of sales is probably greater than OPTIS reported. Many buyers don’t report purchases and some small transactions are ignored. But he said the large purchases which are tracked by a consistent pool of active buyers is a “reasonably accurate indication of deal activity in the sector.”

Source : Insurance Journal

January 2018 | Main Street Industry News | www.pianeia.com | 11

TOP STORIES

SPECIAL REPORT THE PIA,

CYBER RISK,

CYBER CONCERNS

January 2018 | Main Street Industry News | www.pianeia.com | 12

Every week as we go through our news sources, the PIA staff runs across a half-adozen or more stories on cyber concerns, cyber insurance, cyber attacks and so on.

At the end of this story are a list of links of stories we’ve found in the last couple of weeks about cyber risks, cyber insurance, cyber

TOP STORIES attacks and more. We urge you to open them and become more educated on the topic.

What we do know after all of our research in the matter is that the topic has evolved into one of the most important of the last five-years and the concern is growing. It has also gotten the attention of PIA National who is — on your behalf — acting to help you respond to this growing crisis.

Cyber 101 is a new educational resource created by PIA and The PIA Partnership to help educate PIA members and their clients about the seven most common cyber risks faced by small and mid-sized businesses. It also looks at the business practices and insurance coverages that can reduce those risks.

In the near future — and in addition to extortion and ransomware — PIA National and the PIA Partnership will have webinars that focus on: • • • • •

Social engineering Business interruption Data breach/privacy Network security Website media liability

Nicole Carter is the manager of agent/broker relations for Liberty Mutual. She is also the chair of the PIA Partnership.

Carter said, “Agents and

carriers have tiptoed into the cyber arena for a number of years. The age of wading slowly is over. Agents need the same level of expertise and competence about cyber that they have with other areas of risk and insurance.

Their clients increasingly expect it. Our hope is that by elevating this resource, we can create a greater sense of urgency, a call to action to ‘insure yourself, then educate and protect your customers,’” she said.

ABAIS Senior Product Manager David Rupnow agrees. He said, “Many small and mid-sized business owners and operators do not understand the many ways that their businesses can suffer a cyber-related loss.

Because so many people are affected by the data breaches at very large companies, news reports often focus on these events. However, our experience shows us that small businesses are also at risk, and not just from data breaches.”

Carter added that the biggest cyber threat is complacency.

“Cyber 101 is designed to get the message out to agents, brokers and everyone.

The Cyber threat is real, it’s growing, and everyone needs to ensure that they are protecting themselves appropriately.”

Cyber Stories from a number of sources, these stories will provide you with a three-dimensional view of the seriousness of this growing crisis. Click the name of the publication to access the information.

Ransomeware

Insurance Business America

Meltdown and Spectre

Insurance Business America

Security Flaws Intel, Advanced Micro Devices, etc.

Insurance Journal PropertyCasualty360.com

Six Ways Cyber Security Changed in 2017

PropertyCasualty360.com

Six Ways Cybersecurity will Impact Insurers this Year

PropertyCasualty360.com

NAIC Cybersecurity Model Law

PropertyCasualty360.com

Protecting Yourself and Your Company

PropertyCasualty360.com

January 2018 | Main Street Industry News | www.pianeia.com | 13

TOP STORIES

The Wells Fargo Saga May Not be Over President Trump has waded in on Wells Fargo’s multiple scandals. You remember the forced insurance, the mortgage fee overcharges and the fake bank accounts. If you don’t Trump does.

In a tweet he said, “Fines and penalties against Wells Fargo bank for their bad acts against their customers and others will not be dropped.”

Currently the acting director of the Consumer Financial Protection Bureau (CFPB) is White House Budget Director Mick Mulvaney. He’s frozen all regulatory actions — including Wells Fargo’s — and agency hiring while he does a review of what the agency does.

On the agenda once all that is done will be a settlement proposal of tens of millions of dollars for the wrongly charged mortgage fees. The president thinks the fines should be “substantially increased.”

However, so far Wells Fargo has paid $185 million in fines and refunds to its customers.

In the meantime, though the exact terms of the deal have not been revealed, USI Insurance has closed the purchase of Wells Fargo Insurance Services. The insurance company is an insurance brokerage and handles insurance,

consulting, employee benefits and property and casualty national practices, safehold special risk, student insurance, individual health and private risk management insurance lines and small business insurance.

USI CEO Michael Sicard said, “With the combined strength of our two market leading companies, USI is one of the largest and strongest insurance brokerage and consulting firms in the world. We serve large risk management clients, middle market companies, smaller firms, and individuals with a full range of property & casualty, employee benefits, personal risk, program and retirement solutions. We are thrilled to join together with the tremendous professionals of Wells Fargo Insurance Services.”

Wells Fargo’s Perry Pelos agrees. “This strategic transaction is the result of hard work from the outstanding teams of both companies.

I also want to recognize the extremely talented team of professionals who are leaving Wells Fargo to join USI. I’m confident they will continue to be successful as they serve clients’ insurance needs as part of this strong industry leader,” he said.

Source: Insurance Business America

January 2018 | Main Street Industry News | www.pianeia.com | 14

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Contact an RCIS field representative or visit RCIS.COM. RCIC is an equal opportunity provider. The U.S. Department of Agriculture (USDA) prohibits discrimination against its customers, employees, and applicants for employment on the basis of race, color, national origin, age, disability, sex, gender identity, religion, reprisal, and where applicable, political beliefs, marital status, familial or parental status, sexual orientation, or all or part of an individual's income is derived from any public assistance program, or protected genetic information in employment or in any program or activity conducted or funded by the Department. (Not all prohibited bases will apply to all programs and/or employment activities). Some products not available in all states or counties.This is intended as a general description of certain types of insurance and services available to qualified customers provided solely for informational purposes. Coverage is underwritten in all states by Rural Community Insurance Company, Anoka, MN except in Montana where hail coverage is underwritten

by Tri-County Farmers Mutual Insurance Company, Malta, MT. Nothing herein should be construed as a solicitation, offer, advice, recommendation, or any other service with regard to any type of insurance product or services. Your policy is the contract that specifically and fully describes your coverage, terms and conditions. The description of the policy provisions gives a broad overview of coverages and does not revise or amend the policy. Coverage may vary by state. Coverages and rates are subject to individual insured meeting our underwriting qualifications and product availability in applicable states.

RCIS is a registered trademark of Rural Community Insurance Company. © 2018 Rural Community Insurance Company. All rights reserved.

TOP STORIES

Morgan Stanley An Insurance Tax Reform Perspective The impact of the now-called Trump tax cuts is still being analyzed. For insurance it will likely be a good thing and with the pass-through income changes, a huge percentage of independent insurance agents will benefit.

While some states are still complaining about the income tax and other local tax deduction limits, the states will also — say tax experts — see a windfall of income.

Morgan Stanley says the tax reforms and the lower corporate tax rate will benefit most property and casualty insurers. The company predicts insurance companies will see domestic earnings grow by an average of 14% this year.

In its research paper, Morgan Stanley said the biggest beneficiaries will be larger insurers like AIG, W.R. Berkley, Brown & Brown, Progressive and Allstate. They — like many corporations — had been paying taxes in the low 30% range.

Now it’s dropping to — on paper — 21%.

The report says more than likely what they’ll pay is between 16% and 25%. Nuances that will affect the insurers: •

W.R. Berkley’s book value will grow by 11% or more because of a $35 billion benefit

•

AIG — on the other hand — will likely be hit by a $7 billion tax bill or 10% of book value

•

The Hartford will take a 5% hit or 5% of its book value

•

The Hartford also will see an $850 million reduction in its financial results due to the new law on deferred tax assets

The new tax law could also impact earnings if companies decide to reinvest or “share the wealth.” That translates to companies reinvesting to doing things like “hiring talent, improving platforms or sharing with customers in the form of lower pricing.”

That could end up eroding potential earnings.

Source: Carrier Management

January 2018 | Main Street Industry News | www.pianeia.com | 16

TOP STORIES

Trump Backpedals on Crop Insurance PIA National supports the Federal Crop Insurance Act of 1980 (FCIP). It relies on the independent insurance agent to deliver the insurance to the insureds and since the Act’s implementation, the program has thrived.

It also provides the fair and equitable prices farmers need to survive.

In May of last year President Donald Trump said he was going to reduce federal subsidies to the crop insurance program. Trump proposed cutting $46.54 billion from the program. Most of the changes would have come from capping the amount of money given to crop insurance insurers and agents that sell such insurance.

His decision upset farm groups who generally support the Republican Party.

Now the president appears to have changed his mind. Trump spoke last week at the American Farm Bureau’s annual convention and said, “I’m looking forward to working with Congress to pass the farm bill on time so that it delivers for all of you and I support a bill that includes crop insurance. We’re working hard on the farm bill and I think it’s going to go well.”

Also in attendance with Trump was Senate Agriculture Committee Chairman and Kansas Sen. Pat Roberts.

Trump started by bragging the $1.5 trillion tax reform will benefit agriculture — producers, businesses and workers — tremendously.

Combine that with his push to curb regulations and the president said you have a winner.

“The American Dream is roaring back to life.

Businesses across America have already started to raise wages,” he said.

He also pushed changes in NAFTA saying his work in that area will get a better deal for farmers and their products. “When Mexico is making all of that money, when Canada is making all of that money, it is not the easiest negotiation. But we’re going to make it fair for you people again,” Trump said.

Farmers tend to do better than most other U.S. economic sectors and the U.S. farm economy has a trade surplus. But the commodities bust in 2013 has cut profits to less than half the levels of that year.

As for the association, PIA National supports a strong crop insurance program and advocates for independent insurance agents by working with Congress to: • Support an FCIP that continues to utilize the expertise and professional guidance of independent agents.

• Support just compensation for independent agents, the key sales force for the FCIP. The PIA opposes more funding cuts to the FCIP and is working with the U.S. Department of Agriculture to: • Support a formal role for independent agents in negotiations over the Standard Reinsurance Agreement (SRA), an agreement covering administrative reimbursements for approved crop insurance companies.

• Support comprehensive enforcement of anti-rebating and control of business schemes.

Sources: PIA National, Insurance Business America, Insurance Journal, Reuters

January 2018 | Main Street Industry News | www.pianeia.com | 17

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Avoid Gaps When Moving an Account

by Curt Pearsall, CPCU, AIAF, CPIA

President – Pearsall Associates, Inc. and Special Consultant to the Utica National E&O Program Ask agency staff members when the last time was that they moved an account to a new carrier. They would likely say that it happens multiple times a week, possibly every day. When this happens, an alarm should go off to remind them of the many issues that could occur. The most critical issue surfaces if the client suffers a loss that would have been covered by the expiring policy but is not covered by the replacement coverage.

The following errors and omissions (E&O) claim highlights this issue.

The agency’s client was a landscaping and snowplowing operation. The underlying loss was from a slip and fall in a commercial parking lot. It is undisputed that the agency’s client had snow removal coverage on the prior policy, but when a new carrier has the policy, the snow removal coverage is missing. While the producer was aware of the exclusion, there is no documentation to support a discussion on this matter with the agency’s client. The damages were more than $1 million.

This issue is one of the more significant trends today in E&O claims. It is critical that when an agency’s staff moves accounts to a new carrier, it must have very detailed procedures that address this matter head-on.

Those procedures should include the following:

should be in place to verify that the application used to market the account accurately describes the › Ariskprocess as it exists. Oftentimes, the previous year’s application is used to market the account today. The downside is that the client may have different or new exposures that need to be identified and discussed.

the agency receives the proposals from the various markets, there should be a process to verify that the › When coverages requested are the same as the coverages proposed. Agencies should never assume that what the agent asked for, from the carriers, is quoted. A more significant concern, with the excess and surplus market, is because carriers may exclude specific exposures. If necessary exposures are missing, such as the snowplowing exposure in the above claim, an effort should be made to secure the coverage.

replacement coverage is not comparable to the expiring coverage, it is vital to bring the reductions to › Ifthetheclient’s attention. This notification should be in writing and the client, if he or she is agreeable to the reductions, should be required to acknowledge the reductions in writing. Also, if the agency cannot provide the same depth of coverage through the carriers it works with, notify the client as soon as this fact is determined. Based on the coverage that is missing, the client may need to find another agency.

agency does not complete the steps above, there is still another opportunity to identify any shortcomings › Ifin the the coverage. It is at the time of a policy review. If the agency assumed that the coverage was the same, a thorough policy review would have caught the lack of coverage for snowplowing. The review should involve a comparison of the expiring policy versus the replacement coverage. Multiple sets of eyes can help to identify errors more comprehensively. Requesting the client to review the coverage is also suggested. Statements such as, “This coverage is as good as what you had before” (or something to that effect) should definitely be avoided.

Moving coverage is more than just trying to save the client premium dollars. Problems may develop if the replacement policy contains less coverage than the previous policy, and the client is unaware. If the agency really wants to minimize its potential for an E&O claim to develop, it should have a detailed procedure to address this.

The material contained in this article is for informational purposes only and is not for purposes of providing legal advice.You should contact your attorney to obtain advice with respect to any particular issue or problem.

5-R-1252 Ed. 1-18

TOP STORIES

Retiring Soon?

The Best & Worst States for Retirement Somewhere in middle-age we tend to start talking about what we’d like to do when we retire and where we’d like to live. The goal for retirement is to find comfortable and affordable places with plenty of activity available. Other factors strongly considered are low taxes, access to excellent health care, nice weather and low crime rates.

MSN Money says these are the 10 best states and worst states in which to retire. Two of the best are PIA Western Alliance states and two of the worst are PIA Western Alliance states.

10 Best States 1) ARIZONA 14% of the state’s population is over age 65 That figure — says the U.S. Census Bureau — will grow as more Baby Boomers retire The state has low taxes Arizona has great weather The state has easy access to mountain scenery Arizona isn’t that far from the Pacific Ocean Lots to do and no snow to shovel 2) ALABAMA 3) WEST VIRGINIA 4) FLORIDA

January 2018 | Main Street Industry News | www.pianeia.com | 20

5) WYOMING 6) DELAWARE 7) NEW HAMPSHIRE 8) NEVADA Nevada offers more than just gambling It has no state income tax and is perfect for fixed-income residents There is no inheritance tax and no estate taxes The dry climate is ideal Plus it is legal to gamble everywhere 9) MARYLAND 10) MAINE

TOP STORIES

10 Worst States

The Hartford Sells Annuities Business

1) ILLINOIS High taxes are a negative So is a low number of government services The state economy — say some economists — is about to go bankrupt State income tax has gone up to 4.95% 2) MINNESOTA 3) CONNECTICUT 4) NEW JERSEY 5) CALIFORNIA California ranks 49 out of 50 states in the cost of living It ranks 42nd in health care quality California is 45 in tax rate efficiency 6) ALASKA Alaska is 48th in cost of living affordability for retirees Ranks 50th in terms of weather Is 46th in health care quality Bankrate calls it the worst place in the country for retires to retire

The Hartford Financial Services Group is selling its annuities and the $100 billion book of business it contains. The annuities business is called Talbot Resolution and The Hartford has been unwinding from it for the last five years. It has been a thorn in the firm’s side since the 2008 recession when it had to borrow $3.4 billion from the U.S. government to stay afloat.

Since then Talbot has been servicing accounts but not adding new business.

The sale is to an investment group consisting of Cornell Capital, Atlas Merchant Capital, TRB Advisors, J. Safra Group, Pine Brook and Global Atlantic Financial Group. They will pay $2.05 billion for the business. That’s $1.4 billion in cash up front and a 9.7% piece of the business.

The Hartford’s 400 employees at Talbot will move with the new company.

7) HAWAII 8) RHODE ISLAND 9) LOUISIANA

Source: Insurance Business America

10) NEW YORK

MSN Money says those retiring want to live somewhere where there are plenty of leisure activities and in states where their dollar goes as far as possible. Bankrate.com did a study in March of this year and showed the two top things retirees look at when thinking of a retirement location: 1) Standard of living 2) Health care services 3) Another important item is a low crime rate Source: MSN

January 2018 | Main Street Industry News | www.pianeia.com | 21

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How does PIA help me promote my agency?

Let me count the ways.

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veryday PIA members across America promote their agencies using materials and strategies they get from PIA. Our PIA Branding Program is full of marketing materials they can customize and use in their local markets and beyond.

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Best of all, PIA provides these materials to PIA members for free, as part of their PIA membership.

It’s just another benefit of being a PIA member.

Visit the PIA Branding Program at www.piabrandingprogram.com.

PIA would like to thank our Pinnacle Partners for supporting PIA members through their support of the PIA Branding Program.

Learn how the PIA Branding Program can help your agency at www.piabrandingprogram.com.

National Association of Professional Insurance Agents 400 N. Washington St. Alexandria, VA 22314-2353 1-800-PIA-6900 (1-800-742-6900) piabrandingprogram@pianet.org January 2018 | Main Street Industry News | www.pianeia.com | 22 www.pianet.com

JOBCAREER It’s the turning point for successful professionals.

Life-Changing Education The Certified Insurance Counselors (CIC) designation is the stamp of “Career Professional” in the eyes of the insurance and risk management industry. When the letters CIC follow your name, you demonstrate your full commitment to your profession. When you earn the CIC designation you swing the doors of opportunity wide open. In fact, studies published in the Producer Profile publication show CICs earn 30% more than their competitors.

www.PIANEIA.com Available online and in the classroom at www.TheNationalAlliance.com

PIA NE IA EVENTS

CONGRATULATIONS FOR YOUR EARNED DESIGNATION The Professional Insurance Agents NE IA would like to congratulate everyone who has earned a designation from The National Alliance in 2017.

2018 CIC Designation Mr. Zachary Owen Counsell CIC, CISR LSB Financial Hudson, IA Mr. Michael Anthony Luna, CIC Chastain Otis Omaha, NE Ms. Sara J. Richards, CIC Harry A. Koch Omaha, NE Mr. Lucas T. Siel, CIC, CISR, AFIS INSPRO Insurance Lincoln, NE Mr. Matthew Gary Susemihl, CIC Perspective Insurance Le Mars, IA

CISR Designation Ms. Nicole Criqui, CISR Midwest Heritage Services Chariton, IA Ms. Kristina J. Lemke, CISR Van Gorp Insurors Pella, IA Mrs. Kimberly Rye, CISR Treimer’s Insurance Agency, Inc. Hartley, IA

CISR Elite Designation Ms. Jennifer A. Adams, CISR Elite Insurance Associates of Iowa City, LLP Iowa City, IA Ms. April L. Johnson, CISR Elite Southern & Iowa Insurance Services, Inc. West Point, IA Ms. Kristil G. Schoo, CISR Elite Perspective Insurance Sheldon, IA

Mrs. Samantha Short, CISR Holmes, Murphy and Associates, LLC West Des Moines, IA Ms. Alissa Doyle Ward, CIC, CISR Gamrath-Doyle Insurance & Associates Fairfield, IA

Ms. Leisa Van Den Top, CIC, CISR Holmes, Murphy and Associates, LLC West Des Moines, IA

January 2018 | Main Street Industry News | www.pianeia.com | 24

2018

PIA NE IA UPDATE

UPDATE

Oroville, California is home to the tallest dam in the United States. Earlier this year a broken spillway caused the evacuation of close to 200,000 people as officials feared a total collapse.

The spillway has been repaired — or has it? The California Department of Water Resources held a meeting recently in Oroville and the topic was fresh cracks in the newly rebuilt spillway.

Many people who attended the meeting expressed worries about the cracks.

CRISIS!

CALIFORNIA’S OROVILLE DAM

State officials say cracking is normal. The federal government said no new repairs will be needed. None of that is much comfort to the people of Oroville and the thousands downstream from the dam and it was not much comfort to those who attended the meeting.

We will keep you posted.

Source: Associated Press

January 2018 | Main Street Industry News | www.pianeia.com | 25

PIA NE IA EVENTS

Upcoming Events Calendar 2018 For information and to register Click Here or call (402) 392-1611.

Date

Class/Webinar

Where

When

January 10, 2018

Insuring the Building Project: Builders Risk and Installation Coverage

NE/IA

Webinar: 12:00PM - 3:00PM

January 11, 2018

Cyber Liability - the 21st Century Peril

NE/IA

Webinar: 8:00AM - 11:00AM

January 11, 2018

Regarding Ethics

NE

Webinar: 12:00PM - 3:00PM

January 16, 2018

Current Trends & Changes: The Homeowner & Auto Marketplace

NE/IA

Webinar: 12:00PM - 3:00PM

January 23, 2018

And the CHAOS Continues

NE

Webinar: 8:00AM - 11:00AM

January 23, 2018

Commercial Property Claims that Cause Problems

NE/IA

Webinar: 12:00PM - 3:00PM

January 24, 2018

Additional Insureds: The Quandry

NE/IA

Webinar: 12:00PM - 3:00PM

January 25, 2018

How to be the Agent Advocate at Claim Time

NE

Webinar: 12:00PM - 3:00PM

February 6, 2018

Home Business vs. Home Insurance

NE/IA

Webinar: 12:00PM - 3:00PM

February 7, 2018

CISR: Insurance Personal Auto Exposures

IA

Hilton Garden Inn Des Moines/Urbandale

February 8, 2018

Tricks to Fix: Closing Coverage Gaps in Home, Work and Auto

NE/IA

Webinar: 8:00AM - 11:00AM

February 13, 2018

Certificiates and Additional Insureds: Navigating the Maze

NE/IA

Webinar: 12:00PM - 3:00PM

February 13, 2018

E&O Loss Prevention

NE/IA

Webinar: 8:00AM - 11:00AM

February 14-16, 2018

CIC: Personal Lines Institute

NE

Double Tree Omaha Southwest

February 14, 2018

**LAST TIME, NE ONLY** Executive & Management Liability

NE

Webinar: 8:00AM - 11:00AM

February 15, 2018

**LAST TIME, NE ONLY** Man Vs. Machine (NE)

NE

Webinar: 8:00AM - 11:00AM

February 20, 2018

Street Level Ethics

Iowa

Webinar: 12:00PM - 3:00PM

January 2018 | Main Street Industry News | www.pianeia.com | 26

PIA NE IA EVENTS February 20, 2018

Street Level Ethics (NE)

NE

Webinar: 12:00PM - 3:00PM

February 21, 2018

**LAST TIME, NE ONLY** Top 12 Coverage Countdown (NE)

NE

Webinar: 8:00AM - 11:00AM

February 21, 2018

A Walk Around the Farm - Farm Property Considerations (NE)

NE

Webinar: 12:00PM - 3:00PM

February 21, 2018

A Walk Around the Farm - Farm Property Considerations

Iowa

Webinar: 12:00PM - 3:00PM

February 28, 2018

CISR: Elements of Risk Management

Hiawatha

Kirkwood Linn Regional Center

February 20, 2018

Street Level Ethics (NE)

NE

Webinar: 12:00PM - 3:00PM

February 21, 2018

**LAST TIME, NE ONLY** Top 12 Coverage Countdown (NE)

NE

Webinar: 8:00AM - 11:00AM

February 21, 2018

A Walk Around the Farm Farm Property Considerations (NE)

NE

Webinar: 1 2:00PM - 3:00PM

February 21, 2018

A Walk Around the Farm Farm Property Considerations

Iowa

Webinar: 12:00PM - 3:00PM

February 28, 2018

CISR: Elements of Risk Management

Hiawatha

Kirkwood Linn Regional Center

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January 2018 | Main Street Industry News | www.pianeia.com | 27