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TEXAS PROFESSIONAL INSURANCE AGENTS DIGITAL JOURNAL

TEXAS

CONNECTION May 2018

In This Issue Maintain and Enhance Your Carrier Relationships Carrier Relationships: What Agents Have to Say Carrier Relationships: What Our Partners Have to Say P&C Insurers: Satisfying Independent Agents Pays Sales Success Lessons I Learned from my Mom


Texas PIA P.O. Box 700877 Dallas, TX 75370 (972) 862-3333 www.piatx.org

PRESIDENT’S MESSAGE

In This Issue 5 Tips to Maintaining Great Carrier Relationships

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David Gorman

A Sales & Marketing Plan Enhances Carrier Relationships

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Carrier Relationships: The 2018 Independent Agent Study

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Attention P&C Insurers: Satisfying Independent Agents Pays

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Relationships: What Our Partners Have to Say

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Sales Success Lessons I Learned from my Mom

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E&O: Has the Rating of Any of Your Carriers Changed?

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2018 PIA FLS a Success!

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Texas News Round-Up

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In both this month’s issue, and our upcoming 2018 Annual Convention and Expo, we will be focused on relationships. This is a large part of any industry and the insurance industry is no exception. Of the many relationships we have, the carrier partnership is near the top and this month’s articles provide tips on making the most of them. I hope to see you at the Convention and Expo this May 17th-19th, where we’ll be enjoying many opportunities to build our professional relationships with one another, as well as learning new skills to take back to our individual agencies. Agency owners will benefit from our first ever “Agency Owner Day” to be held all day Saturday the 19th. Please see the enclosed Conference Guide for details of the full schedule planned for attendees. I look forward to your continued, mutually successful relationship with one another and Texas PIA. Yours,

David David (Red) Gorman Office: 214-374-9997 Email: david@redgormaninsurance.com

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Join Texas PIA Now If you’re not yet a member, discover the benefits! Membership in Texas PIA is an investment that provides tangible benefits & services, saving you time and money so you can increase your agency’s bottom line. As a member of the Texas Professional Insurance Agents, you are also a member of the National Association of Professional Insurance Agents and have access to a variety of valuable benefits and information that can support you in the growth and success of your business. Our focus is entirely on you, the professional Texas agent. Member Benefits Include: •

Insurance products to sell

Agency Marketing Guide

Agency Revenue Tools

DocIT for Agents

Floodbroker.com and more

Together we’ve formed an alliance of experts to deal with any type of issue or question you may face. Visit piatx.org for more information. TEXAS CONNECTION - TEXAS PROFESSIONAL INSURANCE AGENTS DIGITAL JOURNAL

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5 Tips to Maintaining Great Carrier Relationships By Anthony Curti, Dave Palmisano, from PropertyCasualty360.com Insurance agents and carriers need each other. Here are five tips for ways to ensure that the relationship succeeds. What does it take to establish and maintain great carrier relationships? Patience, hard work, honest dialogue and attention to detail are all necessary ingredients in these partnerships where both parties bring a unique offering to the table and are dependent on one another. 1. Manage expectations A clear understanding of each party’s expectations and definition of success, along with a commitment to devote time, energy and resources toward these goals, are essential. Honest and frequent communications form the bedrock of any relationship, as they define and shape realistic expectations while also feeding crucial insight into a rapidly changing environment. 2. Regular communication Committing to regularly scheduled meetings will keep everyone on task while also advancing the latest knowledge on products, services, new opportunities and market conditions. Keeping this a top priority throughout the year will ensure there are no surprises, particularly when it comes to the third quarter and progress toward attaining year-end goals comes into clear focus.

3. Know each other’s strengths Agents and brokers along with their carrier partners need to know what each stakeholder can do well. Then, make sure these areas align. Frustrations and failure are sure to follow without that alignment, while good alignment uses resources efficiently and becomes the propellant for getting more deals done. In other words, success breeds success. 4. Use data to identify opportunities Using data, benchmarking and business intelligence to identify and profile opportunities to better serve clients is increasingly important. A variety of tools exist on both ends to exploit this knowledge. Collaborating to identify the most appropriate opportunities benefits everyone. 5. Get the message to the right people Getting the message to the desk level is critical. Underwriters, producers and account managers need to be on the same page. Achieving common goals begins and ends with the attitude and actions of those transacting business. Providing adequate lead time and accurate and thorough underwriting data within each submission is also critical. Appreciating and respecting the different responsibilities each party faces in the sale, underwriting and servicing of business will yield constructive growth and development of the relationship, and eliminate needless fingerpointing if goals are not met. Let’s not forget we’re in the relationship business; the interdependence between carriers and agencies is a critical component that drives our business. In order to achieve great relationships, both parties need to work hard at it and expend the energy to remain committed. At the end of the day, stakeholders strive to write business and create value for their organization.

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A Sales & Marketing Plan Enhances Carrier Relationships by Bill Schoeffler and Catherine Oak, InsuranceJournal.com Not only are business and sales plans essential to agency management, they are now often necessary to receive “preferred” status with carriers. It’s difficult to guess at long term trends. New challenges will impact how agencies are run. Insurance companies will tend to leave options open, which means less loyalty to the agents and brokers. So, what can the typical independent agent and broker do in order to succeed? What are the basic ingredients to a well written sales and marketing plan? Know Thyself The best starting point is to first define the agency’s “personality.” The “personality” of an agency is the book of business and it will in turn define what to look for from the various markets and the selection of new markets to represent. For example, a large urban agency that sells only very large commercial accounts will have different expectations than a small town agency that sells all lines of insurance. Start by finding out what the split of business is along each line: personal, commercial, life, group benefits and program business, etc. Then calculate the average size of account for each line. Also, how much of the agency business comes from the top ten accounts? Finally, analyze the distribution of business and identify the top five industries. List the breakdown of the current book of business by line of business, top ten accounts and key industries. Calculate the current percentage of the overall book for that line of business. Is the mix of business healthy for the agency? This is a judgment call for the owners. Niche selling is usually more profitable, however, it is also riskier. If the agency has a lot of small accounts, the procedures in place for selling and servicing them are critical in order to make a profit. It is important to distance oneself from the book of business and objectively ask the question “is this book valuable enough the way it is or should its composition be changed?” If it needs to be changed, what should the agency target? This depends on the expertise of the producers and service staff, as well as the appetite of the firm’s current markets. Write down those future targets next to the current composition. This thought process is what separates the entrepreneur from the average person. How Much Can You Grow? It is important to review the new sales for the agency overall and for each producer. An experienced producer in a typical agency should generate at least $30,000 to $50,000 in new commission dollars each year, depending on their size of book. For large firms with large accounts, the amount would be much higher, maybe even $100,000 in new commissions.

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The hit ratio of each producer needs to be determined. Hit ratios less than 25 percent to 33 percent costs the agency a lot of time and money. The technique of producers with low hit ratios needs to be checked and adjusted. Often, the producer fails to pre-qualify the prospect. Sometimes producers just are not approaching businesses that match up with the products the agency has expertise in writing, nor markets that are competitive for those classes of business. Use the successful producers as a model. The agency may have tremendous sales, however if there is loss of business through attrition, much of the effort for new sales is wasted. Calculate the attrition rate for the agency and each producer. The goal should be around 10 percent or less attrition for the typical property/casualty insurance agency. Higher attrition rates are usually an indication that the business the agency writes is transient and either the clients are price shopping or not good risks. When writing a sales and marketing plan, list the current overall hit ratio, average new business produced and the average book of business in the agency. Write next to those numbers the target for the next twelve months. Below that list write two or three actions that need to be accomplished to reach those goals. Market Relations Today’s agent or broker needs to have a clear understanding of what the carriers can do for them and how this fits into the overall agency plan. Run a list of all of the carriers with volumes, commission rates (or commissions), loss ratios and contingents received. Analyze how the agency’s book of business stacks up with the existing markets. Compare all the carriers and their products against what the agency has with the top ten industry groups the agency writes. Some of the questions that should be asked include: Will volume commitments be met and how will it be done? Are there new markets the firm should seek out? Is the volume spread too thick or too thin? Is the agency maximizing profit sharing agreements? In the sales and marketing plan also list the five most important markets (not necessarily the largest) and the agency’s volume with them. Write realistic agency production goals for the year next to those numbers. Next, list one or two markets that you do not have, but feel the agency could use. Write down next to those names the date you will approach them. Finally, list two or three markets that the agency has outgrown and should get rid of. Take Responsibility

Agents and brokers are dependent upon insurance companies for the insurance products that the agency sells. A strong relationship with the carriers is imperative. The key to any good relationship is communication. Agencies must have a wellorganized plan to communicate with each carrier. Some insurance companies communicate better than others do, so the independent agent needs to take full responsibility to ensure a dialogue occurs. Agencies need to take a proactive approach to managing company relations. Good relations cannot be allowed to stagnate, and weak relations must be built up. Agency owners need to evaluate which companies they should do business with to meet their needs for competitive, responsive markets. TEXAS CONNECTION - TEXAS PROFESSIONAL INSURANCE AGENTS DIGITAL JOURNAL

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Both parties need to grow, and relationships of the past may no longer meet the needs of today, especially if either party has targeted certain classes of business that aren’t of interest to the other. Resources should not be wasted on maintaining relationships with carriers that offer little benefit to the agency. Companies continue to limit the number of agencies they do business with, often to better utilize their resources and to reduce costs. Take Action So how does an agency keep the communication open with its markets and perhaps become a “preferred” agent? Create a process that makes it easy for management to focus on company relationships. The first step is to assign an individual or two from the firm to each carrier as that carrier’s “relationship manager.” Responsibilities for the management of the firm’s top carriers should be divided up among the owners and/or a key non-owner producer or CSR, depending on whom has the best relationship with each carrier. Overall carrier relationship management should always be a major focus for all owners; however, dividing up the duties with others in the firm will ensure that the steps are implemented. A specific action plan should include job assignments, planned visits, information and data to communicate, and a budget to implement the plan. Keep in mind that it takes time and money to nurture a successful company relationship. It’s important to keep track of the plan and make sure it is followed. Even a strong relationship will eventually die if it is neglected. The collection and presentation of information and data is a significant step since it will set the tone of the communication. Agencies that are prepared and well informed will create an immediate interest in the company representatives, since unfortunately; most agencies fail to

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immediate interest in the company representatives, since unfortunately; most agencies fail to do their homework. Stop By to Say Hello Take the sales and marketing plan directly to the insurance company representative. Set an annual meeting to discuss agency goals and future opportunities. In this annual meeting, the agency principal in charge of markets and the relationship manager for that carrier should meet face to face with the regional vice president or branch manager of each contract company and the main underwriter assigned to the agency. There are three objectives for this meeting: 1) inform the company’s management about the current status of the agency and future plans; 2) find out where the company stands now and its plans for the future; and 3) discuss how the agency and the company can do more business together in the future. There should be follow-up meetings to discuss progress on the agency-company game plan on at least a quarterly basis. Both parties need to be open and frank. The agency sales and marketing plan should be reviewed and discussed at the meeting. Reasonable goals and commitments for future business need to be established. Relay the highlights of the meeting back to the agency staff. Plan ongoing carrier “schmoozing” activities to enhance the relationship. It is easier to develop a relationship if parties meet often, and social visits are especially effective. The whole agency needs to be involved with fostering good relations with the markets. Continued on page 27

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Carrier Relationships: The 2018 Independent Agent Study In 2017, NU forged an alliance with the National Association of Professional Insurance Agents (PIA) and Flaspöhler | NMG to conduct the inaugural Independent Agent Study — a research project designed to annually take the pulse of independent Property & Casualty insurance agents throughout the U.S. and provide revealing insight into the demographics, books of business and challenges they face, and reveal their most highly rated carrier partners. Flaspöhler has long conducted its own larger annual study of agents (the Flaspöhler | NMG Producer Study) on behalf of key P&C carriers, which use the results to help them best meet agent needs. Flaspöhler distributes the expanded questionnaire to NU‘s proprietary lists of independent agents nationwide as well as PIA’s national membership (in return for the exclusive right to publish highlights of the findings), resulting in the most reliable and scientifically sound sample available. Only

24%

(about 1 in 4) of PIA members who responded said their insurance

carrier relationships were improving;

19% said their relationships had declined.

View video below to take a look at who responded to the study, and what they said would improve their relationships with the carriers they do business with.

Higher risk appetite

47%,

greater ease doing business

40%

and better rates

33%

were the top three attributes that respondents reported would make them more satisfied with their carriers. See the poster on the next page for an overview of findings from the study.

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Attention P&C Insurers: Satisfying Independent Agents Pays

by Ryan Smith, Insurance Business Magazine There’s good reason for carriers to take note of the NU study with PIA and Flaspöhler | NMG. Property and casualty insurers who best satisfy independent agents also see the greatest financial performance and profitability, according to new data. Independent agents still control the majority of P&C premiums despite the growth of techbased and direct-to-consumer channels. “Independent agents have continually found ways to stay relevant to customers in spite of the push toward digital and direct-channel solutions,” said Tom Super, director of the property and casualty insurance practice at J.D. Power. “Insurers that embrace the critical role independent agents play and work to find ways to partner with them have a significant opportunity to increase overall sales volume through improved customer acquisition and retention.” That contention was borne from J.D. Power’s 2018 US Independent Agent Satisfaction Study, released Thursday. Among the study’s findings: •

Personal lines insurers with the highest commission ratios also have the highest satisfaction ratings among independent agents and maintain the most profitable operating margins.

Independent agents are looking for P&C insurers with a broader risk appetite. Agent satisfaction is lowest when an insurer only offers standard options for policies. When insurers also accommodate specialty and unusual risks, agent satisfaction jumps dramatically.

P&C insurers aren’t hitting the mark with agents. Independent agents are the largest and most preferred channel for consumers, but many insurers don’t seem to recognize their importance. Among agents, overall satisfaction is 696 (on a scale of 1,000). That’s among the lowest scores for business-to-business satisfaction in J.D. Power’s satisfaction studies.

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2018 TEXAS PIA ANNUAL CONVENTION & EXPO THURSDAY, MAY 17 Time

Event

Location

12:00 p.m.

Registration Opens

2nd Floor Lobby Area

12:30 p.m.—5:30 p.m.

Golf Scramble Lake Arlington Golf Course

1516 W. Green Oaks Blvd. Arlington, TX 76013

7:00 p.m.—8:00 p.m.

Welcome Reception

Hall of Fame

FRIDAY, MAY 18 Time

Event

Location

8:00 a.m.—12:00 p.m.

Multi-Line Insurance—Its Evolution Super Bowl and Coverage I & II Speaker: Kaplan Financial Education

CE Credits 4 CE Credits

From Gunshots to Dog Bites Speaker: Kaplan Financial Education

World Series 4 CE Credits I &II

12:00 p.m.– 1:45 p.m.

Keynote Luncheon PIA National Update Speaker: Timothy G. Russell, CPCU, The Russell Agency, LLC

Hall of Fame

1:00 p.m.—4:00 p.m.

Beyond the Basics World Series 3 CE Credits Speaker: Teri Calvin, NFIP Regional I & II Field Relations Manager, Hartford Flood

4:00 p.m.—4:30 p.m.

Break

4:30 p.m.—6:30 p.m.

Expo Arlington Convention Center

Exhibit Halls 2&3

8:30 p.m.—12:00 a.m.

Concert featuring the Blue Hat Band (cash bar)

Plaza on the Hill

Blue Hat Band Blue Hat is a high energy 5 piece dance band playing a wide variety of pop, rock, country, and R&B. Fun, up tempo, sing-a-long, party music to celebrate good times. Their goal is to get everyone up and dancing! Sponsored by Progressive

Join us at 8:30 p.m. for a live concert, sponsored by Progressive.


SATURDAY, MAY 19 Time

Event

Location

CE Credits

7:00 a.m.—12:00 p.m.

Country Mutual Speaker: Patti Romo, Marketing Director, Aggressive

Super Bowl I & II

3 CE Credits

8:00 a.m.—11:00 a.m.

What you Want/Need to Know About E&O Speaker: Bob Dixon, Agent, Texas Insurance Professional Services

World Series 3 CE Credits I & II

11:00 a.m.—12:00 p.m.

Awards Presentation & Annual Meeting

Champions I

Awards Program Presentations for: Agent of the Year Award • Customer Service Representative of the Year Award Company Representative of the Year Award • Company of the Year Award 12:00 p.m.—1:00 p.m.

Keynote Luncheon Hall of Fame I.C.E.C.R.E.A.M for Business Leaders - Lessons Most Leaders Learn the Hard Way Speaker: Billy R. Williams, PhD, President, Inspire a Nation Business Mentoring

1:00 p.m.—4:00 p.m.

Multi-Line Insurance— Super Bowl Its Evolution and Coverage I & II Speaker: Kaplan Financial Education

4 CE Credits

From Gunshots to Dog Bites World Series 4 CE Credits Speaker: Kaplan Financial Education I & II 4:30 p.m.—6:30 p.m.

Expo Arlington Convention Center Prizes awarded for best booth and individual costumes

Exhibit Halls 2&3

Agency Owner Day Exclusively for agency owners, Saturday is Agency Owner Day. See the full day’s agenda on the next page. Enjoy this day of networking and programming for agency owners that will address a number of topics vital to the success of an independent insurance agency.


2018 TEXAS PIA ANNUAL CONVENTION & EXPO SATURDAY, MAY 19

AGENCY OWNER DAY

Time

Event

Location

8:00 a.m.—8:30 a.m.

Continental Breakfast and Networking

Champions III

8:30 a.m.—10:00 a.m.

How to Locate, Interview, Hire and Onboard Champions III Agency Staff Speaker: Billy R. Williams, PhD, President, Inspire a Nation Business Mentoring

10:00 a.m.– 11:00 a.m.

Managing Employment Compliance Risk Speaker: Ken Spencer, President and CEO, HR Services, Inc.

Champions III

11:00 a.m.—12:00 p.m.

Awards Presentation & Annual Meeting

Champions I

12:00 p.m.—1:00 p.m.

Keynote Luncheon I.C.E.C.R.E.A.M for Business Leaders - Lessons Most Leaders Learn the Hard Way Speaker: Billy R. Williams, PhD, President, Inspire a Nation Business Mentoring

Hall of Fame

1:00 p.m.—1:15 p.m.

Break

1:15 p.m.—2:30 p.m.

How to Market to the Modern Insurance Consumer for Minimal Money Moderator: Don Hobdy Jr., Vice President of Sales, ITC

Champions III

2:30 p.m.—3:30 p.m.

How to Automate Your Customer Retention Process Speaker: Billy R. Williams, PhD, President, Inspire a Nation Business Mentoring

Champions III

3:30 p.m.—4:30 p.m.

10 Mistakes Agency Owners and Leaders Make on a Regular Basis Speaker: Billy R. Williams, PhD, President, Inspire a Nation Business Mentoring

Champions III

Keynote Speaker: Billy R. Williams, PhD Billy R. Williams, PhD, is the founder and president of Inspire a Nation Business Mentoring Services, America's best insurance agent and Small Business coaching and mentoring company, and, Williams Family Investment Group; a group of more than 130 partner agencies that produce almost a billion dollars a year in new and renewal insurance premiums.


EXPO MAP

Arlington Convenion Center, Exhibit Halls 2 & 3


2018 TEXAS PIA ANNUAL CONVENTION & EXPO WELCOME EXHIBITORS 21 Century General Agency ABA Insurance Services Agents Alliance Services Aggressive Insurance Anchor General Apollo Group Aspen Insurance Atlas Financial Holdings, Inc. Connect Auto Insurance Direct Auto & Life Empower Insurance Falcon Insurance Group GAINSCO Hallmark Insurance Group Hartford Flood IBDpro iMGA, LLC Imperial PFS InsureZone ITC Jack Schroeder & Associates

McClelland & Hine, Inc. Mendota Insurance Mexico Insurance Online Mexipass International Insurance Orchid Insurance Pronto Insurance Quantum Alliance Risk Transfer Partners Souders Underwriting Group Texas Mutual Insurance Company Texas PIA Texas Specialty Underwriters TexNetUSA The Hearth Insurance Group The Insurance Record Texas Insurance Professional Services Utica National Insurance Western General Insurance Wilson Smith Group Windhaven Insurance

THANK YOU TO OUR PARTNERS PLATUNUM

GOLD

SILVER

BRONZE


SHERATON ARLINGTON HOTEL Recognized as one of the premier hotels in Arlington, we’re confident that your stay will be enjoyable. Dining Options: Parkside Grille, featuring regional and American-style cuisine for breakfast buffet, lunch or dinner, located in the lobby. Parkside Bar, an upscale lounge with a Southwest flair. The Market Place, serving your favorite Starbucks Coffee as well as a mouthwatering array of snacks and beverages, located in the lobby.

Fitness Center: Sheraton Arlington Hotel invites you to come recharge in the state-of-the-art fitness center. Larger than the standard hotel workout facility, this space affords plenty of breathing room for completing your routine on a wide range of cardio equipment like treadmills and ellipticals, plus a dedicated area for strength training, from free weights to weight machines.

Meeting Rooms


2018 TEXAS PIA ANNUAL CONVENTION & EXPO EXPLORE ARLINGTON The American Dream City Welcome to the City of Arlington! As the entertainment capital of Texas, the City is home to Six Flags Over Texas, Hurricane Harbor, the International Bowling Museum & Hall of Fame, the Texas Rangers’ Globe Life Park in Arlington and the Dallas Cowboys’ $1 billion AT&T Stadium Complex. While you’re here, explore some unexpected treasures. From a museum dedicated to bowling, to an internationally acclaimed glass design program, to a homegrown business that schools students in the art of making coffee, Arlington is full of delightful discoveries. Six Flags Over Texas The Thrill Capital of Texas, is home to more than 100 rides, shows, and attractions including 13 world-class roller coasters, plus the all-new and first-of-its-kind, HARLEY QUINN Spinsanity.

Dream Downtown The inspiring message of downtown Arlington’s first public art piece, D-R-E-A-M, made up of five letters that stand 12 feet tall. Downtown Arlington is designated a Cultural District by the Texas Commission on the Arts, so there’s no better place to experience the many vibrant offerings that await. Visitor’s Guide For lots more ideas on what to do in Arlington, download the Convention & Visitor’s Bureau official Visitor’s Guide. Includes area maps, can’t-miss events shopping and dining suggestions and more. And to get you started, check out the next two pages, with money-saving coupons to help you make the most of your time in Dream City. Arlington: The Pursuit of Happy!


2018 TEXAS PIA ANNUAL CONVENTION & EXPO


Call and let them know you are with the Texas PIA Convention, and receive $10 off the regular admission price of $32.


2018 TEXAS PIA ANNUAL CONVENTION & EXPO AT A GLANCE Time

Event

Location

THURSDAY, MAY 17 12:00 p.m.

Registration Opens

2nd Floor, Lobby Area

12:30 p.m.—5:30 p.m.

Golf Scramble

7:00 p.m.—8:00 p.m.

Welcome Reception

Hall of Fame

8:00 a.m.—12:00 p.m.

Multi-Line Insurance (4 CE Credits)

Super Bowl I & II

8:00 a.m.—12:00 p.m.

From Gunshots to Dog Bites (4 CE Credits)

World Series I & II

12:00 p.m.– 1:00 p.m.

Keynote Luncheon—PIA National Update

Hall of Fame

1:00 p.m.—4:00 p.m.

Ethics for Insurance Professionals (3 CE Credits)

Super Bowl I & II

1:00 p.m.—4: 00 p.m.

Beyond the Basics (3 CE Credits)

World Series I & II

4:00 p.m.—4:30 p.m.

Break

4:30 p.m.—6:30 p.m.

Expo Arlington Convention Center

Exhibit Halls 2 & 3

8:30 p.m. –11:00 p.m.

Concert featuring Blue Hat Band (cash bar)

Plaza on the Hill

FRIDAY, MAY 18

SATURDAY, MAY 19 7:00 a.m.—12:00 p.m.

County Mutual (5 CE Credits)

Super Bowl I & II

8:00 a.m.—11:00 a.m.

What You Want/Need to Know About E&O (3 CE Credits)

World Series I & II

11:00 a.m.—12:00 p.m. Awards Presentation & Annual Meeting

Champions I

12:00 p.m.—1:00 p.m.

Keynote Luncheon I.C.E.C.R.E.A.M For Business Leaders - Lessons Most Business Leaders Learn the Hard Way

Hall of Fame

1:00 p.m.—4:30 p.m.

Multi-Line Insurance (4 CE Credits)

Super Bowl I & II

1:00 p.m.—4:30 p.m.

From Gunshots to Dog Bites (4 CE Credits)

World Series I & II

4:30 p.m.—6:30 p.m.

Expo Arlington Convention Center

Exhibit Halls 2 & 3

SATURDAY, MAY 19-AGENCY OWNER DAY Events below exclusive to agency owners 8:00 a.m.—8:30 a.m.

Continental Breakfast & Networking

Champions III

8:30 a.m.—10:00 a.m

How to Locate, Interview, Hire & Onboard Staff

Champions III

10:00 a.m.—1100 a.m.

Managing Employment Compliance Risks

Champions III

1:15 p.m.—2:30 p.m.

How to Market to the Modern Insurance Customer for Minimal Money

Champions III

2:30 p.m.—3:30 p.m.

How to Automate Your Customer Retention Process

Champions III

3:30 p.m.—4:30 p.m.

10 Mistakes Agency Owners and Leaders Make on a Regular Basis

Champions III


Relationships: What Our Partners Have to Say It only makes sense that some of the best people to ask about carrier relationships would be our valued Texas PIA partners. They’ve clearly demonstrated their support of our independent agency system, and want to do business with our member agencies. We took this opportunity to get you the answers directly from the source.

Our Panel Lori Herrington Aspen Insurance

Keith Moon Connect Insurance

Gessie Wilson Empower Insurance

Luis Lemus Pronto Insurance

Here’s some of their take on what it takes to have a successful long-term relationship:

Q

If an agent is interested in working with you, what is the best way for them to connect? Email Lori Herrington lherrington@aspenmga.com or call 903-407-0932. Call Keith Moon at 214-587-2381 Best way to contact us is to call us @ 877-437-5010 and they will be directed to the correct rep for their territory for any questions. Or sign up on our website. Contact our Agency Recruiter directly: Elizabeth Campos, IA Division Recruiter, Office: 956.547.3497 Toll Free: 866-357-9787 Ext. 8891, Address: 805 Media Luna St. Ste 400, Brownsville, TX 78520, website: www.prontoinsurance.com, or email: Elizabeth.campos@prontoinsurance.com.

Q

What types of agents are the best fit for your company? Professional and experienced agents looking for a mutual long term profitable partnership.

Owner operated/managed agencies or agencies that have a very seasoned manager are the best fit for our company. Independent agents looking for multi-tier programs that serve thousands of unique risks. If growth through retention is the agency’s focus Empower’s numerous online tools, call out programs, and software system assist in accomplishing these goals. Empower offers free online quote and bind platforms to help agents compete online as well as in their office line up. We look to partner with committed, aggressive, driven agents looking for a long term partnership with one of the fastest growing MGA’s.

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Q

What is the best way for new partner agents to understand how to succeed with your company and products? At Aspen we offer onboard training to all new partners to ensure they understand our product, system and underwriting. We also encourage communication with both our sales team and our policy services team - call us! Most company websites will guide agents through the binding process and most companies provide a cheat sheet with key underwriting guides, but the best way to understand how to succeed with our company is to receive some online training from us wherein we can either review prior policies sold with us and point out areas of underwriting focus or we can provide some introductory online training and provide helpful hints on how to succeed with our products. Empower provides onsite and video training for all new agents and as agents add new staff. We interact with individuals to provide a comprehensive understanding of our products. Our materials are also provided on line and in print for refreshers as needed. We have a great onboarding program powered by extensive company resources and field support to drive the success of our new partners.

Q

What tips do you have for agents to maintain a long-term strong relationship with you as their carrier? Understanding and adhering to our guidelines is vital to long term success. Mutual respect and good communications are key.

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When quoting policies, do your absolute best to quote/price it correctly as that is a key driver to profitable results and profitable individual agency results is the key to maintaining a long-term strong relationship with us. We never ask agents to give us a certain number of policies per month, nor do we guilt-trip agents that haven't placed business with us because we know that if our product is good for you, you will use it. Empower is diligent in delivering the right rate for the right risk. Agents with an attention to detail and proper discounting will see their book of business grow with Empower, as we, in tandem with the agent, meet the expectations of the insured in policy management and if the insured experiences a loss. Great communication between the agent and Pronto will help drive our strategic planning, marketing, training, and partnership programs.

Q

What do you wish more agents understood about working with their carriers? Not all programs are the same or created equally. We each bring a unique philosophy to how we determine rates, underwrite our products, and service both our agents and insured’s. Aligning values and philosophies ensures profitability. It’s a symbiotic relationship in that we only sell policies if our independent agents sell them for us, so we need the agent to survive. In turn, the agent needs a product to sell or us to survive and if the agent is able to price/rate the policy correctly every time, we will have better results and in turn be able to give the agent a better rate in the long term. Every time that the underwriting department has to uprate a policy because it wasn't rated correctly, that hurts the relationship because the results on policies that are uprated is significantly worse than the results or loss ratio on policies that are not uprated. Examples of rating/pricing correctly include: only giving discounts Continued on page 28

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Sales Success Lessons I Learned from my Mom by John Chapin My mom passed away recently. As I was writing her eulogy, I realized that a lot of what she stood for, and a lot of what she taught me, led to my sales success. As I looked deeper, I realized that most of her examples also had to do with success in life, not just sales. Here’s what I learned.

Mom’s Lessons for Sales and Life Success Perseverance and stick-to-itiveness I remember my first job out of college as a stock broker. I was having a really tough time and I was going to quit. When I called my mom to tell her she said, “John, anything in life worth having isn’t going to be easy. It’s going to be tough. Life will test you to see how serious you are, how badly you want it, how committed you are to your dream. And here’s the thing, all you have to do is hang in there long enough without quitting. If you hang in long enough, eventually the tide will turn in your favor and you’ll win. Every time.” I stayed, and the tide turned shortly thereafter and within two years I was the youngest branch manager in the country. When I started my speaking business in the Fall of 2008 and the economy subsequently dropped off the cliff and the speaking business imploded. I remembered what my mom said, “If you hang in long enough, eventually the tide will turn.” And it did. She was right again. Mom’s lesson: The bigger and more important the endeavor, the more difficult the journey and the more likely there will be temptation to quit at some point. You don’t fail until you quit, and in order to succeed, you need to persevere long enough, and hang on after others have let go. Commitment My mom was a substitute teacher for many years. One time they called her to substitute teach and she was really sick with the flu, but she felt an obligation to help out. So she put herself together as best she could and went to work. Later I asked her why she agreed to teach when she was that sick. She said, “John, people rely on me when other people are sick. I’m not supposed to be sick. In life it doesn’t matter how you feel physically or mentally, what matters is the commitments you make and that you live up to them, in good times and bad, whether you feel like it or not.” Mom’s lesson: Commit and be all-in. The client doesn’t care how you feel, or about any other excuses you have as to why something didn’t get done. They just want what they were promised when they were promised they have it by. Go above and beyond, add that little “extra.” My mom believed if you’re going to do something, you do it right and you do it all out. She always pushed herself to continually improve and be the best she could be. It started in school where she was her high school class valedictorian, and in college where she got straight As. But it wasn’t just the “big” things that she took seriously. She always believed in doing even the smallest things at the highest level. I remember the Halloween I wanted to be a ghost.

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That’s easy right? A sheet, two holes for the eyes, done. Not my mom’s ghost. I mean, I was the ghost but the ghost outfit was going to represent my mom. She had that sheet on me 4 nights in a row, adjusting, cutting, sewing, tailoring, and changing. The fifth night came, Halloween, she put that sheet on me, and made a few final changes before sending the perfect ghost off into the night. Mom’s lesson: If something’s worth doing, it’s worth doing right. Always take it to the next level by doing more than you get paid for and delivering more than people expect. Everything you do reflects back on you. Mom’s second lesson from this example: Leave no stone unturned. You want to make sure you do everything you can to win a sale. As a last-ditch effort, any time I lost a sale I used to ask, “Is it a done deal? Is there anything I can do to still get the business?” This led to me getting the “lost sale” back about 40% of the time. Be a team player. Make people feel important and special. In public my mom always had a smile on her face and a spring in her step, she was positive and upbeat. She wanted to leave a good impression on people and she wanted to make sure they felt good and important when she was talking to them. What people didn’t see behind the scenes, was the enormous pressure my mom put on herself to be the perfect mom and wife. She never let people see the weight she carried on her shoulders, and regardless of that weight, she put her game face on in public, and got done what needed to get done from

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coaching softball, to teaching, to everything she did in the church, to everything she did for her family. She always put others first. She was a team player and always wanted to help, as in the example of teaching when she had the flu. She understood that it wasn’t just about her, she had an obligation to her family, those she worked with, and those she made commitments to. Mom’s lesson: At the end of the day it’s all about people and relationships. As Zig Ziglar used to say, “You will get all you want in life, if you help enough other people get what they want.” This is also another great example of commitment. Finally, if you find yourself in a comfort zone because you think you’re making enough money remember: it’s also about being in a position to help others. I always said I got my backbone from my mom. My mom projected a solid character and inner strength. She exemplified in her words and deeds how important it is to have a strong belief in yourself and what you stand for. My mom’s legacy is one of perseverance, commitment, and keeping your priorities straight along with your obligations. Doing what you do what you need to do, what you committed to do, without complaining, and regardless of how you feel physically, or mentally. That you keep going no matter what and never quit until you succeed. That your word is your bond. And at the end of the day, that you help as many people as possible. Thanks mom. TEXAS CONNECTION - TEXAS PROFESSIONAL INSURANCE AGENTS DIGITAL JOURNAL

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Has the Rating of Any of Your Carriers Changed? by Curtis M. Pearsall, CPCU, CPIA, Special Consultant to the Utica National E&O Program If you answer that question by saying "I don't know," then we need to talk. Each year the various rating agencies review the latest financial condition of over 3,000 P&C and L&H carriers. While the financial condition of some carriers will have improved and thus potentially get a higher rating upgrade, some carriers results may have deteriorated and thus a downgrade may be in order. While it is fairly certain that the marketing representative for a carrier who has been upgraded will be excited to give your agency the news, I wouldn't count on a marketing representative whose company has been downgraded to even bring up the subject. Every day, the new ratings are being published; in AM Best's case the books won't be out until the 3rd quarter, but you can access ratings via their website. While I can appreciate that many agencies will not know the rating of their companies, I certainly hope that they care. After all, put yourself in the position of one of your clients. You place the business with an agent expecting that should you have a loss, the carrier will pay the claim. Logical assumption, isn't it? A loss occurs and you find out the company is insolvent. Trust me - you would not be very happy. Your customers rely on you and your staff to place them with companies that will be around should that loss occur. Show your professionalism and do the right thing. A couple of tips: •

Identify a point person in your office to periodically (at least once a quarter) check on the rating of your markets. This can be done by contacting the company (through the marketing rep) or by accessing the rating via the web.

Establish a criteria/guideline that you will only do business with carriers rated a certain level or higher (suggestion using the AM Best rating…go with at least an A-).

With the amount of activity going to the surplus lines marketplace, make sure you know the rating of the carriers on the proposals you get. If the wholesaler gives you a proposal involving an insurance company that you haven't heard of, ask the wholesaler for the rating. If they don't know it, I would consider not dealing with that wholesaler.

Don't rely on the Guaranty Fund. Periodically, I will get calls from customers asking me why I am so concerned about a particular company because if they fail, the Guaranty Fund will be there to pick up the pieces. The Guaranty Fund is certainly a plus, but it has its limitations. Typically, there are dollar limitations as well as some degree of date sensitivity regarding the date of the loss and the date of the insolvency.

Presuming that agents have done all of the above, there are definitely going to be situations where the rating of a carrier drops. What should be done in that situation? Obviously based on the magnitude of the drop and the actual rating assigned, strong consideration should be given to a professional level of communication to your customers. In this communication you should state the facts and issues accurately. Also, include some degree of detail of the rating organization and the meaning of the rating. To tell a customer that the company that they are insured with is now rated C- without telling them what this really means is not beneficial to anyone. The letter should also state that you would be pleased to provide them with a proposal from a carrier that is rated higher if they would like. Don't make the decision for them. This type of communication is going to be a major part of your defense should a loss occur involving a company that is insolvent. TEXAS CONNECTION - TEXAS PROFESSIONAL INSURANCE AGENTS DIGITAL JOURNAL

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From “A Sales & Marketing Plan Enhances Carrier Relationships”, page 12

Ask the companies to fill out a report card on the agency in order to identify the carriers’ perceptions of the firm. Discuss what the firm can do to improve the existing relationship and to write more business. Determine how the agency can take advantage of the value-added services offered by the carriers, such as financing, training, etc. Now, more than ever before, it is extremely important for insurance companies and owners of agencies/brokerages to build partnerships that are responsive to the business plans established each year by each party. Building improved relationships needs to be a two-way street. It is easy to get this relationship-building program underway and it really works. Responsibilities for this program must be shared and communication needs to be flowing within the firm, within the carrier and between each other. Improved communication and a focus on improving relationships will save time and will make both parties more money, guaranteed. Agencies without a sales and marketing plan are totally reactive to their environment and have little control over their future. Firms that incorporate an annual planning process tend to be more efficient, more profitable and highly valued businesses. The choice is yours. Take the time to plan ahead and be successful or be at the mercy of the winds of change.

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2018 PIA FLS a Success! Members of PIA from around the country came to Washington, D.C., on April 24 - 25 to participate in the time-honored tradition of petitioning their elected representatives. The agents took part in a successful 2018 PIA Federal Legislative Summit (FLS). PIA members advocated for members of Congress and their staffs to defend state regulation of insurance, abolish the FIO, provide a long-term reauthorization of the NFIP, protect a strong and stable crop insurance program as part of the 2018 Farm Bill, and reinstate fair and just compensation in healthcare. PIA was pleased to name Representative Kevin Cramer (R-ND) as its 2018 Legislator of the Year. The PIA National Executive Committee presented him the award on April 25th during the 2018 PIA FLS. "PIA greatly appreciates all of the work Congressman Cramer does in Congress that benefits independent insurance agents and the consumers they serve," said PIA National Vice President of Government Relations Jon Gentile. The PIA National Executive Committee with

"With several important insurance-related pieces of legisKevin Cramer (R-ND) during the 2018 PIA lation facing an expiration date within the next few FLS months – including renewal of the Farm Bill, which covers the federal crop insurance program – as well as extension of the National Flood Insurance Program, we look forward to working with Rep. Cramer to ensure that independent insurance agents are justly represented."

PIA National has unveiled its 2018 Policy and Advocacy Priorities which includes 1) Flood Insurance, 2) Protection of State Insurance Regulations, 3) Role & Value of Agents in Healthcare Reform, 4) Promotion of Small Business & Tax Reform, 5) Cybersecurity and 6) Crop Insurance. According to Gentile, “While these are our top priorities, PIA National is always working to promote and defend the interests of the independent agent, wherever those interests take us.” From “Carrier Relationships: What Our Partners Have to Say”, page 21

when they qualify, rating them as having a TX driver’s license only when they have one, rating for tickets and accidents when applicable, rating individuals as married when appropriate, not having the approach of seeing if the company will catch it and correct the rate.

All carrier appointments are not equal. Agents should be selective in their carrier portfolio to clients. With the ebb and flow of markets, agent should seek carriers with a long history of market consistency, excellent levels of service, and proven claims satisfaction. Limiting the carriers improves relationships and results. Not all carriers are created equal, be sure to find out who it is your working with and whether they have the capacity to truly support you in all facets of your business. Look at every facet of how they handle business: claims, UW, customer service, hours of operation, availability of the Territory Managers, and ultimately how they treat your business needs. Look for mutually beneficial partnerships. Texas PIA extends a thank you to our panel participants, and all of our valued partners. If you are interested in partnership opportunities, visit our website or email vicki@piatx.org. TEXAS CONNECTION - TEXAS PROFESSIONAL INSURANCE AGENTS DIGITAL JOURNAL

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Texas News Round-Up Texas Windstorm Policy Assumption Program to Begin Soon The Texas Windstorm Insurance Association will soon begin its annual program designed to move policies out of the residual market for wind and hail along the Texas coast....more Deadlines for Texas Windstorm Insurer Appraisal Demands Extended The deadlines for a Texas Windstorm Insurance Association (TWIA) claimant to demand appraisal of a claim for damages caused by Hurricane Harvey have been extended, the Texas Department of Insurance reports...more Texas Attorney Sentenced to Prison for Role in $26M Workers’ Comp Fraud Tshombe Anderson has been convicted of stealing patient information from over 200 injured federal workers and then using the information to fraudulently bill the U.S. Department of Labor Office of Worker’s Compensation Program....more Texas Landscaper Must Pay $400K in Workers’ Comp Fraud Case A Pflugerville, Texas, landscape company pleaded guilty March 21 to misrepresenting its payroll so it could pay less for workers’ compensation coverage, according to the Texas Department of Insurance…more Texas Sets Workers’ Comp Discount, Interest Rate at 5.58% The Texas Department of Insurance, Division of Workers’ Compensation has set the workers’ comp interest/discount rate for April 1 through June 30, 2018, at 5.58 percent…more Valero Refinery Fire in Texas Released Air Contaminants A report found that a recent explosion and fire at a refinery along Texas’ Gulf Coast released four types of unauthorized contaminants into the air...more

Texas Crash Spurs Approval of Balloon Pilot Medical Exams in U.S. House The U.S. House has approved a measure requiring medical checks for commercial hot air balloon pilots in an effort to avoid a re-occurrence of a 2016 crash that killed 16 people in Texas...more Research on Coastal Housing Shows Gaps in Natural Disaster Recovery Policies A team including an Iowa State University researcher studied Galveston, Texas, homes following Hurricane Ike, finding that the types of housing and homeowners – and how U.S. recovery policy handles each – played a major role in recovery outcomes...more Texas Moves to Liquidate Non-Standard Auto Insurer, Access Texas insurance regulators placed into receivership and started the process of liquidating a Texas-domiciled/Atlanta, Georgia-headquartered property/casualty insurance company that the insurance department says is insolvent...more Survey: Houston, Dallas Worst Cities for Towing Hassles Houston and Dallas rank number one and two on the list of U.S. cities with the most hostile towing markets for consumers, and Texas is the state most in need of pro-consumer towing reforms, according to a national towing survey conducted by the Property Casualty Insurers Association of America (PCI)...more Texas’ Galveston County Looking to Elevate 200 Flood-Prone Homes Preliminary estimates indicate that a hurricane recovery program in southeast Texas could elevate as many as 200 homes that have been repeatedly flooded...more Do you have news to share? Email vicki@piatx.org with your story.

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AdvertiseINinTHE the Texas ADVERTISE TEXASConnection CONNECTION View our rates for the most cost effective method of keeping View our ratesin for the most cost effective method of keeping your message front of your customers…professional insurance your message in front of your customers…professional insurance agents. agents. Questions? Contact Victoria Reece at vicki@piatx.org or (972) 862-3333. Questions? Contact Victoria Reece at vicki@piatx.org or (972) 862-3333.

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Texas Connection May 2018  
Texas Connection May 2018  
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