March 2015 by Independent Insurance Agents of NM

www.iianm.org

WE ARE DEDICATED TO SERVICE EXCELLENCE

New Mexico’s Experts in Workers’ Compensation Insurance 3900 Singer Blvd. NE • Albuquerque, NM 87109 • 505.345.7250 or 800.788.8851 • www.NewMexicoMutual.com 2

www.iianm.org

a L

“La Voz” is the official monthly e-publication of the

Independent Insurance Agents of NM 1511 University Blvd. NE Albuquerque, NM 87102. (505) 843-7231. Fax (505) 243-3367. Web site www.iianm.org.

"The Voice" of Independent Agents since 1934

This publication is intended to provide accurate and authoritative information on the subject matter covered, but is distributed with the understanding that neither IIANM, nor any contributing author, publisher, contributor or advertiser is rendering legal, accounting or any other professional service and assume no liability whatsoever in connection with its use. Further, the electronic links to our advertisers and/ or contributors found in this publication are provided as a courtesy to our readers and do not necessarily indicate an endorsement by IIANM.

Networking Opportunities

Spring Seminar Extravaganza

What’s Happening? March’s Clickable Calendar

Features

News items from members of Independent Insurance Agents of New Mexico and the general insurance industry are encouraged. The advertising deadline is the fifteenth day of the month, preceding publication.

Introducing Our New Pre-licensing Program

Agency Nation - What the heck is it & why do we need it?

PAP Rental Car Coverage for Family Members

Marketing Reimbursement Program 14

Advertising rates are available upon request. Please contact Rachel Sheffield at rachel@iianm.org for details

IIANM Staff President/CEO Thom Turbett VP of Member Services Consuelo Trujillo Insurance Programs Administrator Cheryl Weddle Business Strategist Mia Logan Communications Director Rachel Sheffield Member Services Associate Renee Trujillo

2014-2015 Officers

VoZ

IIANM Member Benefit Highlight - Get a Smartphone App

Reagan Consulting: Agent-Broker Profitability Reaches Record 21%

Make-a-Wish - Wine & Wishes Event

Prepare Your Clients for the First ACA Tax Season

Snap Stats

Dues Deductibility

Work Ethic

Bring Real Meaning to Customer Service

In Every Issue IIANM 2015 Company Partners!

Tech Talk

Odds n Ends

Advertiser Index Acuity 18 Burns & Wilcox

Back Cover

Docusign

Litchfield Special Risks

Chair Gabe Portillo

Market Finders, Inc. 14

Vice-Chair Connie Sevier

Mountain States Insurance Group

Secretary/Treasurer Mike Parisi National Director Sam Conlee Immediate Past Chair Diana Hobbs www.iianm.org

Molina Healthcare

New Mexico Mutual

Trustco / HCIT

Union Standard

Click here to reserve advertising space in an upcoming issue of La Voz magazine.

These carriers have partnered with our association to support the vitality of the independent agent system in New Mexico. Take a moment to visit their new page on our site and take advantage of their varied products and services. Independent agents have the freedom to choose!

www.iianm.org

INTRODUCING OUR NEW PRE-LICENSING PROGRAM!

NEW O NL COUR INE & RES SES OURC ES

You Asked - We Delivered! For the conventional learnLIVE CLASS Package: This class is rotated between two excellent instructors and offered 10 months out of the year. Package includes printed study manual plus practice study disk. Our live classes are guaranteed - If after taking our course, you do not pass your exam, you can re-attend the course at no additional cost, within one year of your registration date.

P&C Member Price: $234 Non-Member Price: $299

THE CORE STUDY MATERIALS (in print version only) • Study manual along with a drill and practice testing CD

Member Price: $94 Non-Member Price: $119

THE CORE STUDY MATERIALS (in print version only) • Study manual along with an online review tool, InsurancePro™ QBank.

L&H Member Price: $199 Non-Member Price: $259

Member Price: $116 Non-Member Price: $136

For the online learner:

www.iianm.org

ONLINE CLASS PACKAGE: This course uses an engaging, interactive format with instructor-led videos providing the structure and design of a classroom setting in an online format. Additional study materials including a Study Manual (PDF), State Law Supplement (PDF), MP3 audio reviews, InsurancePro™ QBank, Review Test, Mastery Exam, and InstructorLink™ will further support your studies.

Member Price: $140 Non-Member Price: $160

THE CORE STUDY MATERIALS (in an electronic version only) • PDF study manual along with an online review tool, InsurancePro™ QBank.

Member Price: $100 Non-Member Price: $120

15 HOURS OF CONTINUING EDUCTION FOR THE INSURANCE PROFESSIONAL

IIANM’s Spring Seminar MARCH 25 & 26, 2015 S H E R AT O N A B Q U P T O W N

March 25 - Morning Class 8:00 - 9:00am / General Session (Everyone attends) 9:00 - 12:00pm / (P&C) How to Get Your Agency More Attention Online 9:00 - 12:00pm / (P&C) Commercial Crime 9:00 - 12:00pm / (L&H) Co-ops, 1 Year After Their Start

March 25 - Afternoon Class 1:00 - 4:00pm / (P&C) Engaging a High Performance Workforce in Your Agency 1:00 - 4:00pm / (P&C) Liability for Contractors 1:00 - 4:00pm / Legislative Update 4:00 - 5:00pm / Ethics Day 1

March 26 - Morning Class 8:00 - 12:00pm / (P&C) Directors & Officers 8:00 - 12:00pm / (P&C) Homeowners 8:00 - 12:00pm / (L&H) “Retirement Lifestyles - Getting the Most from Social Security”, “Impact of ACA Ops”, “Dental Benefits & the Future of Dentistry”

March 26 - Afternoon Class

1:00 - 4:00pm / Live Mock Trial 1:00 - 4:00pm / (L&H) Culture, Communication and Transition 4:00 - 5:00pm / Ethics Day 2

www.iianm.org

YOU BE THE JURY!

AR N I EM

And earn 3 CE credits

Join us on the second day of seminar, March 26th at 1:00pm for a live MOCK TRIAL of a real life, high profile case involving the Cowboy Stadium. Listen to the case facts, witness testimony and attorney’s arguments and decide for yourself who’s really responsible. Special guest speaker:

Ryan Hanley

Ryan Hanley is the Head of Agency Nation, the insurance industry's leading resource for sale, marketing and automation strategy. As a former independent insurance agent and certified insurance counselor, Ryan has worked with hundreds of insurance clients to find the quality insurance coverage that individuals and businesses need, at the most competitive price in the market. Having produced over 500 consumer-focused insurance articles for his former insurance agency, Ryan prides himself on the ability to answer complex insurance questions in everyday terms that insurance consumers can easily understand and apply to their own needs. Check out Ryan’s class, “How to Get Your Agency More Attention Online” Wednesday morning, March 25th.

Full Seminar (15 CE hrs): Member: $200 / Nonmember: $240 One Full Day (8 CE hrs): Member: $105 / Nonmember: $140

BREAK EXHIBITORS Click here for your exhibitor registration form

One Half Day (AM 4 CE hrs / PM 3 CE hrs): Member: $70 / Nonmember: $75 Ethics Only (1 CE hrs): Member: $35 / Nonmember: $45 NextGen Full Registration (15 CE hrs): Member: $150

For special room rate of $115/night, call Sheraton’s central reservations line at (800) 325-3535. Deadline is March 3, 2015 This seminar is made possible by these sponsors:

www.iianm.org

Click on a class to register: Monday

Tuesday

Wednesday

Thursday

March 2015

Friday

sts a c web

(No CE Credits) Reaching Diverse Customers Marketing Series - Introduction

Webcast: Webcast: Webcast: Employment Law Procedures Manual Comm Property & the Insurance 1, 2, 3 â&#x20AC;&#x201C; An E&O Endorsements Agent Overview that Can Make You $ 2CE 3CE

An Errors and Omissions Mock Trial

26 Spring Seminar EXTRAVAGANZA! 15 Hrs of CE for Insurance Professionals

Reagan Consulting Guides to Training and Perpetuation

Business Body Language CSR Essentials - Personal Time Management CSR Essentials Relationship Management CSR Essentials - Verbal Communication Skills: Phone Etiquette & Client Interaction

www.iianm.org

Representing some of the most financially strong and innovative insurance companies in the specialty marketplace

“FINDING MARKETS FOR THE AGENTS OF NEW MEXICO SINCE 1977” WE THANK YOU FOR YOUR BUSINESS!!

Top-Tier Markets For:

Commercial / Public Auto General Liability Property / Vacants Garage / Dealers Liquor Liability Special Events Inland Marine Directors & Officers Liability Professional Liability / E&O Commercial Umbrella Watercraft / Motorcycles / ATVs Personal Umbrellas Homeowners Mobile Homes Dwelling Fire / Vacants New Mexico’s Locally Owned Managing General Agency

ESTABLISHED IN 1977

Market Finders, Inc. www.iianm.org

5201F Venice Ave NE - P.O. Box 90280 Albuquerque, NM 87199-0280 (800) 530-8711 (505) 822-8711 Fax: (505) 822-1165 www.marketfindersnm.com

MARKETING

www.agencynation.com

Looking to dominate your insurance market? You’ve come to the right place.

By, Chip Bacciocco

Agency Nation: What the heck is it & why do we need it?

Rather than tell you what it is, I’d like to share with you how it came to be and, as I share with you the challenges we were trying to solve, I think it will become apparent what Agency Nation is and why we need it.

Even before we launched the Consumer Portal – the new TrustedChoice.com – we were acutely aware that we needed an accompanying information & resource center where agents could discover everything they needed to know about digital marketing and learn how TrustedChoice.com could help them succeed online. In fact, as early as the spring of 2013, Dick Poppa, CEO of IIABNY, and I were talking about the need to create a comprehensive training and education resource for agents because we both considered it critical to our success with the Consumer Portal. And I was getting similar input from other state associations and agents across the country.

PRODUCER

At TrustedChoice.com, these are the questions we have been asking ever since: 1.Do we need to provide a free online education platform where independent agents can learn what they need to know to successfully market their agencies online? 2.Do we need to inform agents about the benefits of participating on the national Consumer Portal for Independent Agents – TrustedChoice.com – as part of that education? 3.Do we need to offer independent agents a forum for collaborating on digital marketing strategies and tactics? Do we need a way to share ideas about how to market ourselves online? Should we provide a forum to debate these ideas, to offer alternatives, and to discover and publicize best practices? 4.Should this be a crowd-sourced resource for our industry? Do we want to talk at independent agents or talk with them? Do we want active participation, contribution and feedback from all interested members of our industry – from agents and carriers and association executives and service providers and technologists and researchers? 5.Do we need to create and publish content in order to fulfill this mission? Do we need to post videos and blogs

and white papers and podcasts and discussion threads and other educational materials in order to communicate all of these ideas?

Our answer to all of those questions was repeatedly YES. We needed to do all of this and more. What kind of education and training content were we imagining? Whatever would succeed at engaging the most agents is the simplest answer. But more specifically, we were imagining all of the following: • Blog series on topics like: “5 simple things you can do to drive more traffic to your agency website next month” and “The Complete 2015 Guide to Local SEO for Insurance Agents” and “Three Elements of an Effective Insurance Agency Website” and “Seven Insurance Marketing Trends for 2015.” • Videos on subjects like “4 Ways to Innovate Your Insurance Brand with Peter Van Aartrijk”, and “What 2015 Holds for the Association with IIABA Chairman David Walker” and “LinkedIn Connected App: Get More Engagement in Less Time on LinkedIn.” • Podcasts of interviews with industry leaders like carrier executives, association executives, prominent agents, etc. • A library of training materials detailing everything related to participating on TrustedChoice.com in downloadable PDF format, etc. • Info-graphics that explain how Social Media works and how agents can tie into these organic networks to market their agencies, etc. • Discussion threads where agents can pose their own topics and ideas and/or respond to others’ posts with comments and feedback. Etc. etc.

Get the Full Story www.iianm.org

Distinctively…...Litchfield Special Risks, Inc. Classes of Business:

Multi-Line-Brokerage-Umbrella

■ Scottsdale Insurance Co. ■ Endurance American Specialty ■ Strickland Insurance Group ■ USLI ■ Century Insurance Group ■ Essex/Markel ■ Heath XS ■ Seneca Insurance Company ■ Admiral ■ Cover X ■ Great American ■ RSUI

■ General Liability ■ Commercial Property ■ Umbrella/Excess Liability ■ Pollution Liability ■ Professional Liability ■ Liquor Liability ■ Directors & Officers ■ Errors & Omissions ■ EPL ■ Inland Marine

Classes of Business:

Markets:

Transportation

■ Scottsdale Insurance Co. ■ Canal Insurance Co. ■ Carolina Casualty Ins. Co. ■ Northland Insurance Co. ■ Colony Insurance Company ■ Lloyd’s of London ■ Century Insurance Group

■ Auto Liability ■ Physical Damage ■ Cargo ■ GL ■ Garage ■ GKLL ■ DOL

Li tchfield Special Risks, Inc. was founded in 1980 and since tha t time, our top priorities have been providing superior customer service and representing only the finest insurance companies. We realize that our most valuab le assets are the people that we are here to serve, the independent agents, our customers. We have a top notch, professional sales staff that is here to assist you with your Surplus Lines Insu rance needs. We offer great service, competitive quotes and wide selection of markets to suit your agency’s needs.

P & C Online Quoting With Litchfield Special Risks, Inc.

■ 24/7 Anytime Quotes ■ Live online help and training available ■ 15% Commission

■ Get a quote online within minutes ■ E-Check, Visa and Master Card payment options ■ Many classes available, Monoline GL & Property or Package

Visit Our Newly Designed Website at: www.lsrinc.org El Paso • 7016 Orizaba, El Paso, Texas 79912 • Tel: 800-592-1027 • Fax: 915-532-9973

www.iianm.org

the next big advantage for small business

USadvantage is our new and proprietary product that replaces BOP for new business and is an option on package accounts. With over 280 eligible classes of business available, you can grow your business easily and quickly. USadvantage allows you to provide your customers with comprehensive and flexible coverage, tailored to meet their needs.

USadvantage is easy! Our online rating system, Express Rate, will take the guess work out of determining if an applicant is USadvantage eligible. You can also bind coverage online for certain classes. Best of all, you still have a dedicated underwriter to assist with coverages and pricing as needed.

Want to know more? For more information on eligibility and coverage, contact your local Union Standard branch office today!

A M

BEST

Commercial Insurance >> Done the Right Way >> By a Company of People >> Who Care 6501 Americas Parkway NE, Suite 600 | Albuquerque, NM 87110 P 505-830-0038 | TF 888-387-0038 | F 505-830-0033 | usic.com

Products and services are provided by one or more insurance company subsidiaries of W. R. Berkley Corporation. Not all products and services are available in every jurisdiction, and the precise coverage afforded by any insurer is subject to the actual terms and conditions of the policies as issued.

Union Standard Insurance Group is a member company of W. R. Berkley Corporation, a Fortune 500 company. www.iianm.org

Virtual University’s Ask an Expert

ulty

VU Fac

PAP Rental Car Coverage for Family Members

According to one insurer using the ISO PAP, only the named insured is covered when renting a vehicle from a rental car agency, not any other family members. Another insurer said that there was no loss of use coverage (e.g., the cost to rent a car) if the insured's auto was being driven by a permissive user. Is this correct? "One of our companies states that only the named insured is covered when renting a vehicle from a rental car agency (if, of course, all other stipulations of the policy are met). Any listed drivers on the policy (no matter their age) are not covered if they are not a named insured. Is this coverage interpretation correct? I simply do not agree with it. We are determining physical damage and loss of use coverage. The adjuster did not show me the exclusionary language. All that was said was that management had passed down their decision that a ‘named insured’ only is covered for physical damage and/or loss of use expense for a rental vehicle as long as physical damage coverage on their policy. Any other family member, whether named as a driver on the policy or not, was not covered when renting a vehicle (if not a named insured)." "Our insured has an ISO PAP with rental reimbursement coverage. The insured's non-resident son-in-law was driving her covered auto and involved in a collision. The carrier refused to allow rental reimbursement unless the vehicle was rented and driven by the named insured or a listed driver. I am of the opinion that the rental must be rented by the insured but can be driven by anyone as long as it's disclosed on the rental contract. The rental reimbursement should be allowed regardless of who is driving as the insured paid for the rental reimbursement coverage and an expense was incurred." First let's respond to the second question, then the first one. As I understand the second question, the adjuster is saying there is no rental reimbursement coverage because the car was wrecked by a permissive user, not the named insured or a resident family member. On the surface, that doesn't sound right because the named insured is still without transportation, but let's see what the VU faculty have to say.

FACULTY RESPONSE All the PAP requires is that the loss of use expenses be incurred by “you,” the policyholder. So, as long as the policyholder incurs the expense, it shouldn’t matter who was driving. Ask them if the loss of use is covered if the insured drives the rental and lets the son-in-law drive one of the other vehicles.

Not all the dots are connected in the policy. However, it is clear that the named insured was letting a relative drive the insured auto, and that insured auto was damaged, and the insured is entitled to rental reimbursement on an auto they might rent to replace the insured auto while it is being repaired. Since the policy is silent on who may be allowed to drive that rented auto, I’d say it should be covered.

FACULTY RESPONSE

I find nothing in the policy you sent that limits coverage to the named insured and “listed drivers.” As an aside, one misconception with the ISO PAP is that only listed drivers are covered under the policy. Unless this restriction is specified as a policy endorsement, all resident family members of any age are covered and, in fact, so are permissive users. Drivers are listed for rating purposes, not coverage purposes, again unless the policy is modified to reflect this. FACULTY RESPONSE The policy says that it will pay for transportation expenses incurred by you resulting from a covered comprehensive or collision loss. It says nothing about who may drive a vehicle that may be rented. At the same time, the policy points out that insureds for liability purposes include permissive users. www.iianm.org

If anybody would have bet with you, you won $10. The company in question took another look at the scenario and had to agree with our feeling that coverage would apply to a family member. I don’t know if the first person I talked to was somewhat uninformed but nothing could be substantiated to defend their response.

Click here to view additional faculty responses and also other related articles. You will need to log-in to view, so if you do not know your log-in info, send Rachel an email.

MARKETING

REIMBURSEMENT

PROGRAM

There has never been a better time to co-brand and promote your agency with Trusted Choice. Our three tiers of reimbursement can help offset your advertising costs. You have the freedom to apply for any or all of the reimbursement options.

TIER

UP TO Receive up to $750 for advertising

$750

locally online.

Receive up to $750 for using the

TIER

UP TO Freedom Campaign advertising materials.

$750

Receive 50% of the invoice amount, up to $750 total.

Receive up to $100 for co-branding your

TIER

UP TO promotional items and/or your website

$100 POTENTIAL OF

$1,600

using the Trusted Choice logo.

Receive 50% of the invoice amount, up to $100 total.

An agency that takes advantage of all 3 tiers can be reimbursed a maximum of $1,600 in 2015 per agency location.

For Tiers 1 & 2 contact:

For Tier 3 contact:

Jo Buckley

Kiescha Cherry

(703)706-5412 joanne.buckley@iiaba.net

(703)706-5443 www.iianm.org kiescha.cherry@iiaba.net

PRODUCTS

Take advantage of your IIANM member discount

Get a smartphone app for your insurance agency packed with these features:

Accident Support

Provides info on what to do in the event of an accident.

Home Inventory

Allows clients to catalog their possessions and more.

We design your app to match your agency's brand.

Claim Generator

Guides clients though collecting data needed to file an auto claim.

Push Notifications

Gives your app a voice with mobile messaging.

One of your IIANM â&#x20AC;&#x153;Non-Insuranceâ&#x20AC;? Product Benefits:

Emergency Services

Allows users to quickly find emergency services.

For questions, and to find out our member discount, please contact: brett.sutch@iiaba.net or 800-221-7917 ext. 5464

www.iianm.org

Bill Pay

Your clients pay their bill from their phone.

BENEFITS

Customized For Your Insurance Agency

AGENCY VALUE

Reagan Consulting: Agent-Broker Profitability Reaches Record 21% for 2014 Survey Measures Large & Mid-Size Private Agencies & Brokerage Firms Agent-broker profitability reached 21 percent for 2014 in the Reagan Consulting Organic Growth and Profitability (OGP) survey, a new record for the survey that began in 2008. That median profitability for EBITDA (earnings before interest, taxes, depreciation and amortization) for 2014 was up appreciably from 19.3 percent in 2013 and 18.4 percent in 2012, according to the survey. Reagan Consulting's study also found: â&#x20AC;˘ Median organic growth for 2014 was 6.2 percent, matching 2013 and 2012. â&#x20AC;˘ The fastest growing segment of business was once again commercial lines, with an organic growth rate of 7.0 percent. Group benefits grew at a 5.7 percent clip. â&#x20AC;˘ The median Rule of 20 score was 16.9, up from 16.5 in the prior year. The Rule of 20 is the sum of an agency's organic growth rate and one-half of its EBITDA margin; if the sum equals or exceeds 20, an agency is driving strong shareholder returns. Reagan Consulting uses the Rule of 20 to measure agency value creation.

PRINCIPAL

"The agent/broker world grew in profitability for the fifth straight year -- while sustaining positive revenue growth for a third straight year," commented Kevin Stipe, president of

Reagan Consulting, a management consulting and merger-and-acquisition advisory firm for the insurance distribution system. "These two metrics drive valuation, largely determine operating health, and are imperative to a firm's ability to successfully perpetuate." Reagan Consulting has conducted its quarterly survey of agency growth and profitability since 2008, using confidential submissions from approximately 140 mid-size and large agencies and brokerage firms. Roughly half of the industry's 100 largest firms participated in the most recent survey. Median revenue of the firms completing the survey is more than $17 million, making it the industry's preeminent survey of mid-size and large privately held brokers. Brokers surveyed forecast a median organic growth rate of 6.0 percent in 2015, the fourth consecutive year for a forecast in that range. Brokers are projecting a "pullback" in profitability for 2015 to 20.0 percent, Stipe reported. For further information and commentary, contact Kevin Stipe of Reagan Consulting at (404) 869-2532 / kevin@ ReaganConsulting.com. Each participating agency receives a customized, confidential report of its performance compared with the overall survey results, as well as Reagan's quarterly commentary of industry trends impacting agents and brokers. For information on participating in the OGP survey, contact Michelle Appelbaum at (404) 233-5545 or by email to michelle@ReaganConsulting.com

EBITDA: Earnings Before Interest, Taxes, Depreciation & Amortization Source: Reagan Consulting Organic Growth and Profitability Survey (www.ReaganConsulting. com)

www.iianm.org

For All That Matters

facebook.com/acuitywow www.iianm.org

COVERAGE

Prepare Your Clients for the First ACA Tax Season BY MIKE OWENS & MICHAEL MAHONEY

In 2015, insurance is showing up on tax forms for the first time—causing what is expected to be the most complicated tax season in recent history. The additional tax filing paperwork this year is a result of the Affordable Care Act’s (ACA) tax subsidies and the requirement that virtually everyone enrolls in health insurance or pays a tax penalty. As independent health insurance agents, you can help your clients understand how taxes and health insurance intersect—building your credibility as a knowledgeable and trusted advisor in the process. These guidelines will help you prepare your clients for a smooth tax season: If they received a tax subsidy. Last year, 85% of ACA enrollees received government tax subsidies to make their health coverage more affordable. Those individuals and families were granted subsidies based on their projected income for 2014, not their actual income.

If they had coverage and did not receive a subsidy. If your clients and everyone in their household had health insurance last year, very little needs to be done. They will have to report that they had minimal essential coverage as outlined by the ACA on their tax forms and simply need to check the appropriate box on Form 1040. No further action is required. If they did not have health insurance. If your client did not have health coverage last year, they may have to pay a fine, known as the individual shared responsibility payment. That payment amounts to 1% of a person’s household income or $95 per adult and $47.50 per child—whichever is greater. Many individuals mistakenly believe they owe only $95, but those with higher incomes could end up paying a much greater fine. www.iianm.org

If your clients do end up facing a fine, they will see it represented either as an addition to their tax bill or a subtraction from their tax refund. Tax Penalty Exemptions Not everyone who was uninsured in 2014 will be required to pay a fine. If your clients did not have health insurance in 2014 but have a justifiable reason, they may be exempt. Health coverage exemptions apply to members of specific religious sects that oppose health insurance, and those who do not have to file a tax return due to income level. Additionally, hardship exemptions, which pertain to an individual’s ability to purchase health insurance, are available for people who have been evicted from their home, are facing homelessness or have filed for bankruptcy in the last six months.

PRODUCER

Now, they will need to report whether their actual income was higher or lower than the projection on their tax returns. If it was higher, those individuals might owe the government money. If it was lower, they might qualify for a larger refund. If your clients received a tax subsidy in 2014, they must present their actual income for the year when they file their tax return. Your clients should receive Form 1095-A by early February, which will outline the exact tax subsidy amount they received. They will need this form to file their tax return properly.

You should note that the 1% fine is applied to household income after subtracting the tax filing threshold amount, which is $10,150 for an individual. For example, someone who earned $40,000 would only be fined 1% of $29,850 ($40,000 - $10,150 = $29,850), so the fine would be $298.50. There’s another catch: The penalty is charged on a monthly basis once a person is uninsured for more than three months. To find out exactly how much your client owes for going uninsured—whether it was four months or the entire year—use Form 8965.

Your clients can request forms from the federal or state marketplaces in order to apply for an exemption. If they were exempt last year, they can file Form 8965 with Form 1040 to prove it.

Next year, the tax penalty for going uninsured will increase substantially to $325 for each adult and $162.50 for each child, or 2% of income, whichever is greater. The total will continue to increase the following year. If your clients faced a fine for not having health insurance in 2014, they still have time to avoid making the same mistake twice. Enrolling in health insurance today is the best way to avoid complications during tax time and save money this year. Mike Owens is GoHealth general manager of agent services. Michael Mahoney is GoHealth senior vice president of marketing. Click here to see more.

Steve

ANDERSON.com by, Steve Anderson (Always feel free to email me with comments, new ideas or products that have worked for you. I will check them out and spread the word!)

Using Electronic Forms for Annual Account Reviews Annual account reviews – on every account – are one of the best ways to create a better customer experience, increase retention rates, and improve E&O protection for the agency. While it is a best practice – not every agency, unfortunately, makes this a standard practice. Last year, I was consulting with an agency that had started an annual account review process for their personal lines clients. They created and printed standard account review forms for both homeowners and personal automobile. They were mailing these forms out to their customers and asking them to complete the information and return the form in the enclosed postage-paid envelope. The number of surveys returned was not very large. I understand why. With today’s connected consumer, taking the time to write out my answers on a form and stuffing it back into an envelope to mail is just simply too much work. There has to be a better way. I have been exploring online survey platforms and how they might be used to streamline the account review process for both the client and agency staff. There are dozens of “survey” platforms available, but they are so similar, that the biggest difference usually comes down to pricing and plans available. The vast majority of these platforms provide survey forms that look dated. They also force desktop users to switch back and forth from mouse to keyboard to complete the form. Even more effort is required to complete the form on a mobile device. In my research, I came across a new platform (launched late last year) called Typeform. Typeform has taken a different approach to online forms by making them look good and have them both keyboard and mobile friendly. Check out a sample of how their forms look and work. Creating a Typeform is similar to other online form and survey platforms. You use a drag-and-drop interface to add different types of questions to your form, adding descriptions

and options, and then linking these parts together to create the flow your users will follow in answering your questions. Typeform only shows one question at a time, and automatically places the cursor in the answer field so you are ready to type in your response. You don’t have to click anywhere. If there are multiple-choice options, Typeform shows letters beside each option so the user can just tap the keyboard letter and immediately proceed to the next question. These options are also customized for mobile platform to make your form mobile-touch easy. Each form is available using a URL link, can be launched in a pop-up window on your website, or embedded directly in a web page on your agency website. The agency receives an email notification when each form is completed. Information from the forms can also be exported as a spreadsheet in Excel file format and is accessible through their API, so – at least theoretically – the date can be automatically added to your agency management system. I recommend you embed these forms on your agency website. You can send an email to the client asking them to complete the form by providing a link to the specific page. This gives them a good reason to go to your agency website, and allows you to subtly include an upsell or cross-sell reminder on the thank you page they will see after the form is completed. As in many platforms, there is a free and pro version. The free version lets you make unlimited forms with basic features. The pro version adds logic jumps and hidden fields to forms, as well as removes the Typeform branding. If you only need a couple of forms, you can pay $10 per form for a pro version. For $240 per year, you can have an unlimited number of pro forms. I’m impressed with Typeform. There is no longer any excuse for every agency not to have an annual account review process as part of every renewal for every client as a best practice. www.iianm.org

Make it Harder to Crack Your PIN and Password! Every day there seems to be a new story or article about cyber criminals and hackers stealing identities and revealing sensitive information. These hackers wreak havoc on individuals’ credit history and lives by disclosing their private information. While hackers have become more sophisticated in the tactics they use to steal information, a report from SplashData notes that they still prefer the easy route. Your personal passwords and Personal Identification Numbers (PINs) may not be as clever or nearly as secure as you thought. Following is information on how to create a more secure login. This month, SplashData published its list of the worst passwords of 2014. These were gathered from files of stolen passwords that hackers had posted online. Topping the list were "123456," "password," and "12345." Some other combinations in the top 25 of the worst passwords for the year also included "letmein," "dragon," and "football." Nick Berry, the founder of technology consulting firm Data Genetics, stated that a majority of people use the same passwords and PINs. Out of 3.4 million four-digit passwords that Berry analyzed, 11% were "1234," followed by "1111" (6%) and "0000" (2%). Creating unique and hard to break passwords is more important today than ever. This is especially true for access to sensitive information such as online banking, online investments, and medical information. Tips to strengthen your codes and passwords • Avoid using your birth date/birth year. In the event your license is stolen along with your bankcard, it will be easier to figure out your PIN. Berry's analysis also reveals that all possible 19XX combinations were among the top 20% most-common PINs. • Create different passwords for different accounts. You are better off having a separate and unique password for your most sensitive online accounts — email, bank, and credit card websites, for example. A hacker cracking one account will not be able to expose all of your personal information. • SplashData suggests making sure your data is encrypted on all devices. Also, you should not leave password lists in unsecured documents or on sticky notes. • Make sure your passwords are complex. They should have at least eight or more characters that consist of a mix of letters, numbers, and symbols. • When speaking with Yahoo! Finance, Berry also noted that typical PIN combinations tend to use numbers that are www.iianm.org

close together, either in value or on the keypad. Do not choose a mix such as 45 or 12, or picking numbers in a straight line (like "2580"), Berry says. Instead, try to pick numbers far away from each other. • Use Two-Factor Authentication whenever possible. This process adds an additional layer of security beyond the User ID and password. For example, my bank sends a code via text to my cell phone that I then must enter on the website within a few minutes for access. Some websites are beginning to add this process to enhance their security. For example, Gmail now allows you to create a two-factor authentication process when logging into your account. It adds a little more time to the process but greatly enhances your security. Warning signs • Make sure you review bank and credit card statements on a regular basis. This can help you catch discrepancies early, potentially minimizing the damage of a cracked PIN or password. • Although hackers and identity thieves are getting more sophisticated in their approach, old-school tricks are still common. These can include planting card skimmers and cameras on public ATMs, for example. To prevent getting your PIN “skimmed,” cover the keypad from view while entering in your ATM PIN and pay attention to anything that might seem “weird” with the machine itself. • You get three free credit reports a year. Use them. Experian, Equifax, and TransUnion are all required to provide consumers a free credit report annually. This allows you to check the history of accounts opened in your name. Being proactive about managing your credit history will help you avoid unpleasant surprises the next time a bank or other entity runs a credit check. The number of data breaches and security incidences in 2015 will likely increase. Taking appropriate steps to make sure your online transactions are as secure as possible is well worth a little bit of effort. Using common sense and enhancing your PINs and passwords may not guarantee your identity is not stolen, but it is sure to make it less likely.

INDUSTY ISSUES

For more information, click here to access the full report.

Share of 2012 Personal Auto Production

Personal Auto Market Share: 1995 - 2012 Only about 1 percentage point of market share shifted between 2011 and 2012, with captive agency companies yielding approximately 1% to direct response carriers. Exclusive agency companies dropped from 51.1% of the market down to 50.2%, while direct response climbed from 17.4% to 18.3%.

National IAs 6.2%

Regional IAs 25.3%

PRINCIPAL

Independent agency carriers together held their market share, and in fact climbed ever so slightly from 31.5% in 2011 to 31.6% in 2012. However, by looking more closely we see that regional IA carriers increased from 24.9% to 25.3%, while national IA carriers dropped from 6.6% to 6.2%. For the second year in a row, direct response companies produce more than one of every six dollars in personal auto; the channel’s share closed at 18.3%, up from 17.4% in 2011. A look back to 1995 shows the market share mix has changed considerably.

Direct Response 18.3%

Captive Carriers 50.2%

By contrast, national IAs carriers have lost more than half of the 14.1% market share they enjoyed in 1995, closing 2012 with 6.2%. Their share remained fairly stable from 1995 to 2000, taking a significant dip in 2001, but stabilizing through 2005, when they began a steady, but slow decline from 2006 through 2012.

From this perspective, the long-term trend for captive carriers has resulted in the loss of nearly 10 percentage points of market share since 1995. This is characterized by: • A steep 4 percentage point drop in 2000. • A gradual drop from 54.4% in 2000 down to 52.5% in 2009. • Another significant drop to just below 50% in 2010. • A bounce back to around 50% in 2011 and 2012.

Personal Auto Share: 1995 ‐ 2012 Data Labels for '95, '00, '05, '10, '12

National IA 60%

Regional IA 54.4%

59.8%

Exclusive Agency 52.8%

50%

40%

Regional IAs companies have climbed nearly 7 percentage points during those 18 years, with a significant jump in 2000 followed by a gradual climb from 22% in 2000 to 24% in 2009, and then a jump of nearly 2.5 percentage points in 2010 before losing part of that gain in the two years since.

20% 30%

18.4%

10%

14.1%

0% ‐10%

7.7%

22.2%

23.9%

13.7%

12.5%

9.8%

11.8%

Direct Response 49.1%

50.2%

26.4%

25.3%

16.4%

7.0%

18.3%

6.2%

95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12

Dues Deductibility By federal law, we are required to provide each of our member states with the following disclosure regarding their 20132014 dues. Dues to the Independent Insurance Agents & Brokers of America (IIABA) are not deductible as a charitable contribution but may be deductible as an ordinary and necessary business expense. To the extent that IIABA engages in lobbying, the portion of the dues that relate to lobbying expenses is not deductible as an ordinary and necessary business expense. This law was enacted in 1993, effective January 1, 1994 [Section 13222 of the Omnibus Budget Reconciliation Act of 1993 (OBRA 1993)]. The non-deductible portion of dues for 2013-2014 is 25.27%. Please forward this information to the appropriate staff in your organization. The following is a recap of the non-deductible portion of dues for the past six years: FY 2008-09 FY 2009-10 FY 2010-11 FY 2011-12 FY 2012-13 FY 2013-14 FY 2014-15

Estimated Estimated Estimated Estimated Estimated Estimated Estimated

18.23% 17.72% 21.92% 22.83% 22.71% 23.76% 25.21%

Actual Actual Actual Actual Actual Actual

17.35% 21.37% 22.19% 22.29% 23.14% 25.27%

www.iianm.org

Peak Performance. Secure Solutions. Personalized Service. No matter how challenging the terrain, Mountain States offers a clear path for your customers when it comes to handling business claims. We deliver exceptional service, by real people, in real time. Whether it’s workers’ compensation, property, auto or general liability, we ensure a swift and comprehensive resolution to your client’s claim. Questions? Need a claims specialist? Contact David Hilliard, Claims Director, at dhilliard@msig-nm.com or 505.764.1407.

The Mountain Stands Behind You.® www.msig-nm.com Albuquerque, New Mexico 505.764.1400

www.iianm.org

The road to the Canyonlands near Moab, Utah

LEADERSHIP

So much about insurance agency management success has nothing to do with strategy. Success is more about execution than strategy. Success is about hard work. Success is about accountability at all levels. Success is about standing up and accounting for something. Are you asking what else can be done to attain success or are you finding excuses and crutches?

By, Chris Burand

When I drive by insurance agencies in my travels around the country, I rarely see any car in the parking lot after 5:01 p.m. I know work is being done from home. I understand attending community events in the evening is work. I also understand that long hours are not indicative of results. But the odds suggest I should see cars in the lot after 5 p.m. at least occasionally. Lead Lists

“Ask not what your country can do for you, ask what you can do for your country.” - John F. Kennedy What an elegant, profound statement that still resonates almost fifty years later. It inspires. It leads. It causes a person to want to do great things. Today we have politicians stating, “Don’t ask, don’t tell.” What a sad difference a few generations make. And I’m not referring to the sexual preference aspect of this quote. “Don’t ask, don’t tell” has much more significance.

PRINCIPAL

Think about what this really suggests: “Stick your head in the sand!” Is this supposed to be good advice? Again, this has ramifications far beyond military policy. Such an attitude has ramifications for the entire country and I often see this attitude filtering down into insurance agencies. Which of these quotes best exemplifies the attitude in your agency? Are your employees energized to make a difference or are they looking for ways to slide under the radar to avoid accountability? Are they working hard or hardly working? Parking Lots Consider, for example, your agency’s parking lot. When does your agency’s parking lot empty? When does it fill up? Are the producers’ cars in the lot too often when they should be out prospecting? Where are those cars really when they are not in the parking lot? When do the owners’ cars arrive and depart? Are the owners setting the best example?

While I don’t see a lot of employees working after 5 p.m., I do hear a lot of complaints that not enough leads exist. But why does anyone owe a producer a lead list? Shouldn’t producers take the prerogative to find their own lead list? The complaint that more leads are necessary is simply a crutch. A better strategy might be to make producers find their own leads, right from the get go. Quality leads are readily available using free search engines and by proactively asking for good references from clients and other contacts, both personal and business. Other sources for lead lists are government databases. Some states and counties have excellent databases that can be used for developing personal and commercial leads. Perhaps the best lead list can be made by tracking all the pertinent data about prospects with whom the producer has tried and failed. In fact, if a producer keeps track of the right data, such as premiums by line, carriers by line, agencies/brokers by line, hot buttons, coverages, and gaps in coverage just to name a few, the opportunities with such information are limitless. The key point is that sometimes, a person has to get out and do something for themselves rather than waiting on a handout such as a lead list. Those lists are really just a crutch. Success is not found by waiting for the leads to develop. A person has to pro-actively ask. If a producer cannot do this in this economy and soft market, they very likely should seek employment elsewhere because the odds of them succeeding are tiny.

www.iianm.org

Procedures Along with complaints about the lack of lead lists, I hear complaints about procedures. Producers claim they can’t follow procedures because the procedures make it too difficult to make sales. But what exactly are they doing that prevents them from following procedures? Based on hundreds of interviews with staff and producers, a huge portion of most agencies’ books are renewed as is, so much of these books are never touched by producers. Also based on hundreds of interviews, I don’t find many producers quoting a lot of new accounts. In fact, I’ve had staff and even producers tell me, “I’m not sure if I should bring this up, but no one (or no one except...) is making much effort to bring in new business.” So where are producers, including agency owners, spending all their time? Many agency owners never know because the “Don’t ask, don’t tell” philosophy rules the agency. Don’t ask whether we are really working and definitely don’t tell anyone that we aren’t. My experience is that producers who follow quality procedures are often the most successful producers in an

www.iianm.org

agency. Good procedures improve productivity, which means people have more time to sell more accounts and to write accounts better, resulting in higher commissions per account. So much about insurance agency management success has nothing to do with strategy. Success is more about execution than strategy. Success is about hard work. Success is about accountability at all levels. Success is about standing up and counting for something rather than wishing one was an ostrich that could bury it head in the sand. Are you and your people asking what else can be done to attain success or are you and your people finding excuses and crutches? What are you doing to lead like past generations? Chris Burand is president of Burand & Associates, LLC, an insurance agency consulting firm. Readers may contact Chris at (719) 485-3868 or by e-mail at chris@burand-associates.com. NOTE: None of the materials in this article should be construed as offering legal advice, and the specific advice of legal counsel is recommended before acting on any matter discussed in this article. Regulated individuals/entities should also ensure that they comply with all applicable laws, rules, and regulations.

CUSTOMER SERVICE

Bring Real Meaning to “Customer Service” Many research studies confirm that customer service is a pivotal attribute of any insurance provider for both personal and small commercial clients. Personal lines buyers particularly are concerned with having a personal advocate who is representing the interests of the client more than the company. Small commercial lines customers are focused on quick carrier response, fair claims settlements, accurate policies, billing issues and having a knowledgeable agent.

clearly. In addition to your own individual brand strengths, share the strengths you likely share with most independent agents:

There’s more to customer service than returning phone calls, following up on e-mail or completing annual policy checks. Customer service is every bit as much about how you do things as the daily checklist of what you do. It’s about consistent delivery of your brand values with each and every customer interaction. It’s about seeing your services from your customer’s perspective, not from your own.

◦ Personal interest in seeing every client succeed

Always remember: if you can deliver against client expectations, the business will come.

◦ Ability to create customized coverage—not limited by corporate requirements established by headquarter offices elsewhere

Step 1: Consider what’s required throughout a customer lifecycle. Not only are individual customer needs not the same, the same customer has different needs depending where they are in the purchase cycle. New customers need more handholding. Don’t assume because they aren’t asking questions that they aren’t curious or confused. Explain your processes, introduce your team, let them know what to expect. Existing customers need reinforcement that they’ve made the right decision. Remind them why certain policies or services are appropriate for their account. Solicit regular updates on their business goals and take the time to uncover new concerns. Refresh your account relationships. Don’t leave appreciation to chance. If you don’t have a regular schedule for client contact, create one. It doesn’t always have to be face-to-face (although that should occur quarterly at a minimum). Take the time to forward relevant articles, recognize important milestones or business accomplishments, ask questions, and listen. If you sense an area of concern or worry, address it promptly and provide solutions. Always look for opportunities to upsell existing accounts. This should not be a heavy-handed sales job. However, during regular review of client business, share information about new or relevant products and services. Even if the client isn’t ready for a sale right away, when you position yourself as an interested, trusted resource, they will think of you first when new opportunities do arise.

CSR

Step 2: Convey the benefits you provide as an independent agent. There is an intangible that independent agents bring to a relationship. Be sure you communicate these advantages

◦ Understands the worries other business owners face ◦ Flexibility Part 2 of monthly series

◦ Local, accessible ◦ Invested in the community ◦ Focused on long-term client relationships, not short-term sales

Step 3: Have A Consistent Strategy While you staff may have the skills to interact with your customers, it is also important to have an overall organizational strategy to keep your customers happy. Following are some tips to ensure that your agency is constantly providing proactive customer service at every client interaction: Personal Touches Count: Your customers want to feel like they have access to real people. Don’t let your telephone prompts and website send them in a circle of never-ending frustration. Post photos and bios of your staff on your website, allowing customers to see that there are real people working on their behalf. Be There For Your Clients: Ensure that your customers can reach you. Provide an after-hours answering service, and if there is a widespread claim situation such as a flood or hail storm, have the office staffed both early and late when needed. Avoid the use of PO boxes for your mail and make sure they know your physical address, This will help build trust and remind them that your agency is a real business, with real people who care about their needs. Give Them What They Want: Make sure you are fully meeting your customers’ needs. Set up focus groups, interview customers, or run a survey to get ideas on what they really want from doing business with your agency. Consider a quick follow-up survey after each interaction. Your Agency In The Community: Consider some non-traditional ways to create more touch points with your current and potential customers. Think about offering webinars, daily social media updates about fun things happening in your office, manning a booth at local trade shows and conventions. And don’t forget that while people come to these forums to learn about insurance from you, you can learn as much–if not more–from them.

www.iianm.org

Introducing Molina Healthcare’s exciting 2014 Medicare Advantage Prescription Drug Special Needs Plan Molina Healthcare, a Fortune 500 Company, was created more than 30 years ago by Dr. C. David Molina. As an emergency room doctor, he believed that every person should have access to high-quality care. Molina Medicare Options Plus HMO SNP Plan offers a competitive plan design with additional benefits that you can market year round to meet the needs of dual eligible customers.

• Large Provider Network • Comprehensive and Preventive Dental Services • Vision Exams and Eyewear • Transportation • Over-the-Counter Medications and Supplies • Strong Compensation Plan • Renewal Commissions • Competitive Plan • Market Year Round to Dual Eligible Customers

If you have a New Mexico Life and Health License, contact us to learn more. Please contact: Broker Support Unit (866) 440-9788 broker@molinahealthcare.com

NSR_14_MMG_345

38979MED0214

www.iianm.org

an d

Odds ends May your pockets be heavy and your heart be light. May good luck pursue you each morning and night...

Can a cup of coffee improve your health? Wealth is not about having a lot of money; it’s about having a lot of options. ~Chris Rock

Kids say the smartest things These words of wisdom are said to have come from real kids who obviously have a lot more wisdom than one might expect:

• Exercise. A study cited by the International Journal of Sport Nutrition and Exercise Metabolism found that people who drank a caffeinated beverage before exercise burned 15 percent more calories during their workouts than those who took a placebo. • Eyesight. The chlorogenic acid in coffee contains a strong antioxidant that’s been shown to prevent retinal degeneration in mice. Research suggests it might play a role in helping humans prevent deteriorating vision and blindness. • Diabetes. A Harvard School of Public Health study found that people who drank an extra cup of coffee a day over four years decreased their risk of a Type 2 diabetes diagnosis by 11 percent.

• Never trust a dog to watch your food. • When your dad is mad and asks you, “Do I look stupid?” don’t answer him. • Never tell your mom her diet’s not working. • Home is where the house is. • Laugh and the whole world laughs with you, cry and ... you have to blow your nose. • If you want a kitten, start out by asking for a horse. • Don’t pick on your sister when she’s holding a baseball bat. • When you get a bad grade in school, show it to your mom when she’s on the phone.

The facts behind St. Patrick and his day For many people, St. Patrick represents an excuse to wear green on March 17, maybe go to a parade, or drink some Irish whiskey. But who was St. Patrick in real life? The most common belief is that he drove the snakes out of Ireland. Ireland probably never had snakes, though, and the myth may refer to Patrick’s efforts to stamp out the serpent imagery used by the Druids. He also may have used the three-leafed shamrock to illustrate the concept of the Holy Trinity to the people he was trying to convert to Christianity as a missionary in Ireland during the fifth century. Historians agree that Patrick was born in Roman-occupied Britain, the son of a Christian deacon. At age 16 he was captured and taken to Ireland, where he was a slave for six years. During this time, his Christian faith strengthened. One day, according to a letter he wrote about his early life, he heard a voice promising he would soon return home. Shortly afterward he escaped his captors and went back to his family. He later wrote that an angel appeared to him in a dream, telling him to return to Ireland as a missionary. Patrick went back to the land where he had been a slave to convert the Irish and to minister to those Christians living there. Why do we celebrate him on March 17? That’s believed to be the date of his death. Although never formally canonized, Patrick came to be considered a saint. March 17 was celebrated as a religious holiday until 1903, when it became a public holiday in Ireland by an act of the British Parliament.

www.iianm.org

BURNS & YES, WE CAN DO THAT

WILCOX ACCESS IS OUR MIDDLE NAME. Our access to the widest range of domestic and international carriers means you can say yes to almost any hard-to-place risk. Give your clients what they want to hear with Burns & Wilcox.