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A Subsidiary of Risk Placement Services, Inc. Serving the Transportation Industry Since 1946 Fall 2013 • South Carolina Agent & Broker

FALL 2013

Independent Insurance Agents & Brokers of South Carolina PO Box 210008, Columbia, SC 29221 800 Gracern Road, Columbia, SC 29210 803-731-9460 803-772-6425 (fax) e-mail: information@iiabsc.com

Contents 6

Message from the National Director

IIABSC Staff

G. Frank Sheppard, AAI President ext. 1239 or 803.760.1239 fsheppard@iiabsc.com

The Affordable Care Act Update: Fees, Taxes and Higher Premiums 10 When is A Producer Required to Be Appointed By A Carrier? 14 What Should You Do When Buying, Selling and Merging Agencies? 17

Rebecca H. McCormack, CPCU, CIC, AAI Vice President ext. 1238 or 803.760.1238 bmccormack@iiabsc.com

2013 SC Trusted Choice® Big “I” National Championship Report 22 ACT: Becoming a Social Business – A Model for Success 23 2013 Big “I” SC Education Awards Luncheon 28

Beth Chastie Vice President of Administration & Finance ext. 9462 or 803.731.9462 bchastie@iiabsc.com

Kadi Quinn, CISR: 2013 SC Outstanding CSR of the Year 29 2013 Young Agents Conference Photo Recap 31

Laura D. Cornell, CIC Director of Insurance Programs ext. 1227 or 803.760.1227 lcornell@iiabsc.com

Member News 34 IIABSC Education & Events Calendar 36

Megan Huebner Director of Events & Membership ext. 9463 or 803.731.9463 lmhuebner@iiabsc.com Anita J. Trevino Director of Communications ext. 1237 or 803.760.1237 atrevino@iiabsc.com Mary A. Ellis Professional Development Administrator ext. 1219 or 803.760.1219 mellis@iiabsc.com Jessica Martinez Customer Service Representative ext. 1225 or 803.760.1225 jmartinez@iiabsc.com Martha Lavigne Administrative Assistant ext. 9461 or 803.731.9461 mlavigne@iiabsc.com

South Carolina Agent & Broker is the official magazine of the Independent Insurance Agents and Brokers of South Carolina and is published four times annually. IIABSC does not necessarily endorse any of the companies advertising in this publication or the views of its writers. Articles and information published in this magazine may not be reproduced without written consent of the IIABSC. South Carolina Agent & Broker is not responsible for unsolicited manuscripts, art or photography. The publisher cannot assume responsibility for claims made by advertisers and is not responsible for the opinions expressed by contributing authors. For more information on advertising, contact Jim Aitkins Blue Water Publishers, 22727 - 161st Avenue SE Monroe, WA 98272 360-805-6474 fax: 360-805-6475 jima@bluewaterpublishers.com

Message from the Chairman of the Board

South Carolina Agent & Broker • Fall 2013

Palmetto Partners 37 2013 Board of Directors and Executive Committee 38

Advertiser Index Amerisafe 13

Johnson & Johnson

Anderson and Murison

Lighthouse Property Insurance

Assure Alliance

M. J. Kelly of South Carolina

Bankers Insurance Group

NetComp 27

Builders Mutual Insurance

Preferred Specialty

Prime Rate Premium Finance

Burns & Wilcox

20, 21

FCCI Insurance Group

RPS Rollins

Genesee General

Southern Insurance Underwriters

GUARD Insurance Group

Summit Marketing Services

InSite Support Services

TAPCO Underwriters

The National Security Group

UPC Insurance

Utica National

ISU Agency Network JM Wilson Jackson Sumner & Associates

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IIABSC Chairman of the Board Ashley Brady, CIC

s I collect my thoughts to say thanks and farewell as your IIABSC Chairman of the Board, all I can think to say is that I cannot believe how quickly these two years have flown by. It has been twelve years since I was sworn in for my first term on the Board of Directors, and whenever I look back I am humbled. First of all, it was just few weeks after the Sept. 11 terrorist attack. While life goes on, at the time it felt a little wrong to be celebrating anything after such devastation. Another overwhelming aspect is just how much our industry has changed since then. Some changes were a direct result of 9-11, but not all of them. It has been an incredible honor and a privilege to work with such an amazing group of people. Of course that includes my fellow board members and the IIABSC staff, but mostly I mean our agents, our supporting company partners and fellow Big “I” members across the country. Our Young Agents are near and dear to me, as it is the group I started working with when I first became active in the Big “I.” I even had the opportunity to serve on the national committee along the way and get to know other Young Agents across the country. Serving as your Chairman I still saw many of those same people at national events because they too have grown into other roles in their state associations. Those relationships I’ve built really bring it home to me why it is so important to identify those young agents in your office who have what it takes to serve as our future industry leadership and get them started on their journey. Just bringing them with you to the Spring Conference or sending them on their own to the Young Agents Conference could be enough to show them you’re invested. If you don’t have many Young Agents in your agency or are having difficulty recruiting talent, one step you could take to improve the situation is to take on a student intern. We’ve recently partnered with the Brantley Risk and Insurance Center at Appalachian State University to help bring into our state the incredible talent that comes through their doors. Since they are specifically training for insurance careers, these students are capable of much more than stuffing envelopes and answering phones. They would allow your agency to experiment with new

South Carolina Agent & Broker • Fall 2013

positions and job functions without having to make the longterm commitment of a full-time employee. If you’re interested, please contact IIABSC Frank Sheppard (fsheppard@iiabsc .com or 803.760.1239) and ask for the “Agent’s Guide for Internships,” created by ASU’s Brantley Center. Another aspect of our association that became more important to me the more I learned about it is InsurPac, our national political action committee. It is a fund to make contributions to candidates running for federal office. You may not realize it, but there are a lot of issues on the federal level other than the Affordable Care Act that majorly affect our industry. Agent licensing reform (NARAB II) and federal insurance regulation have been on the table for a few years now, joined by the reauthorization of Terrorism Insurance and Federal Crop Insurance. The real reason I am passionate about InsurPac is how it empowers us to participate in the political process. Every spring for several years now I’ve traveled to Washington D.C. with the rest of the IIABSC delegation to discuss issues with our federal legislators. We talk about how the decisions they make could affect consumers. But they also understand by our visit that the national Big “I” has our support, and that we will vote for candidates who support our issues. Before I started participating in these trips I didn’t really pay much attention to Congress. I thought of them as very powerful people making important decisions hundreds of miles away, and I couldn’t do much about what they decided to do. Now I know that is wrong. Congress only has the power we give them. The voters put him or her in office, and we can remove him too. I hope that you will join in my passion for Young Agents and InsurPac and know that while I will no longer be your chairman, that passion has not left me. Finally I want to thank my mother, Ruth Brady, for bringing me into this industry. She was at work when she went into labor with me, so I was literally born into it. I also want to thank my brilliant and beautiful wife, Becky, for supporting me in all my activities with the Big “I” and elsewhere. Thank you all, and I leave you in good hands with Ken Finch and the rest of the 2014 Board of Directors.

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The ISU Agency Network Fall 2013 • South Carolina Agent & Broker

National Director Jon A. Jensen, AAI, AIP

he wait is finally over: Project CAP’s online rating portal is live in South Carolina. What that means is that consumers can go to the Trusted Choice® consumer website, trustedchoice.com, and use the “Get a Quote” tool to be quoted on home or auto coverage through participating carriers. The transaction ends by selecting a local Trusted Choice® agency to finish the process. But only those agencies that have signed up to participate at the Project CAP website, projectcapmarketing.com, will show up in the agency list generated by the Get a Quote tool. Less than half of our membership would be included in any consumer search performed today. If you’ve just been waiting for online rating to go live, wait no longer. It’s live, and the steps to register are below. If you are not yet a member of the Big “I” give us a call at 803.731.9460, and we’ll get you started as well as go over the other benefits of membership. If you are a member and have other concerns, please share them with us. Contact IIABSC President Frank Sheppard at fsheppard@iiabsc .com or 803.760.1239. While the state and national Big “I” associations are incredibly excited that Project CAP is fully operational, our work is far from over. What’s next for us is to step up our promotion of the brand overall with consumers statewide, but especially with trustedchoice.com and its wealth of information and tools. Follow these easy steps to set up your full agency profile on Trustedchoice.com: 1. Go to projectcapmarketing.com and choose “Login as an agent” in the upper right-hand corner.

South Carolina Agent & Broker • Fall 2013

2. Login with your IIABSC username and password. Use the “Forgot Username and Password?” tool on iiabsc.com or email logon@iiaba.net if you don’t know yours. 3. Click the “Sign Up” button on the home page and then again on the resulting Consumer Portal page. 4. Verify or update your agency name, phone number and email address for the specific agency location that you are signing up for. This should be the email address and phone number Project CAP will use to contact you. 5. Agree to the Terms & Conditions and $1 charge. The charge establishes your Project CAP account and earns you four free leads. 6. Complete your billing information. The only charge you will accrue until Jan. 1, 2014 is the $1 establishing charge. There is no charge for leads until the New Year, and even then you will have four free leads banked. 7. Complete all agency profile fields, and regularly scroll to the bottom and click “Save Changes.” The more complete your profile is, the more likely consumers will select it. 8. Once you are ready to publish it to TrustedChoice .com for consumers to see, click “Save and Publish.” Please note that your profile will not publish if there are any uncompleted items on the Mandatory Elements tab.

Affordable Care Act Update:

Fees and Taxes and

Higher Premiums Oh My!

By Jerry Rhinehart, CIC, CLU, ChFC, RHU Panama City, FL

an. 1, 2014 is the first day for the major implementations of the Affordable Care Act (ACA). This law affects millions of people in the U.S., not to mention any business with 50 or more full-time employees. Many look forward to this law’s full enactment; others do not. Whatever your view it’s still important to understand how it will impact you, your family and virtually every business in this country. When a business is discussed in the context of the ACA, it means any and all employers. It could be the large privately owned manufacturing plant in your town, the small family-owned restaurant you visit periodically, the national technology company in which you own stock, the nonprofit hospital in your town, or your local school district, church or state government. UNDERSTANDING FPL A crucial term to know as it relates to the ACA is “Federal Poverty Level.” Here’s how it works: If an individual or family income is below 400 percent of FPL in 2014, they would be eligible for a premium subsidy for the mandated Qualified Health Plan (QHP). In 2013, the annual income threshold at 400 percent FPL is: • $94,200 for a family of four, • $62,040 for a family of two, and • $45,960 for a single individual.

These thresholds are indexed to increase each year. If the income is above 400 percent FPL, there is no chance of a premium subsidy. However, the lower an individual’s income falls under 400 percent FPL, the larger the potential premium subsidy. Subsidies can only be received through the Exchange (now referred to as the Marketplace). The Congressional Budget Office first estimated that the average annual premium subsidy would be $3,970, but they recently revised that number to $5,510. 10

South Carolina Agent & Broker • Fall 2013

AVOIDING PENALTIES Starting in 2014, the ACA states you must purchase a QHP. If an individual chooses not to do so, they will be subject to a penalty, although minor exceptions exist. Here’s how it works: In 2014, the penalty (referred to as a “shared responsibility payment”) would be the greater of $95 or one percent of annual gross income. As an example, someone with a gross annual income of $50,000 would have a penalty of $500, because the one percent of their gross annual income is greater than $95. Remember this is an annual penalty. The individual’s QHP premium could be more than $500 per month! Both the minimum dollar amount of the penalty and the gross income percentage are scheduled to increase in subsequent years. Complex rules concerning the penalty calculations for families with minor dependents also apply. A family of four below 133 percent FPL in 2014 would have an income level of $31,322. The equivalent for a family of two is $20,628 and for an individual, $15,282. They all would qualify to be on Medicaid as their QHP. Premiums and out-ofpocket payments would be minor. Income is the only determining qualification for Medicaid under this provision; assets are not counted. Both income and assets are examined when one tries to qualify for Medicaid as it relates to a stay in a Skilled Nursing Facility. For employers, there is no chance of a penalty to any employer with less than 50 full-time employees (FTE) in an entire calendar year. (FTEs work 30 hours or more in a week.) An employer with 50 or more FTEs, referred to as a large employer, probably needs to be concerned. The rule for a large employer

a subsidy, the calculation would be 15 x $3,000 = $45,000. So that does not provide a QHP to its employees is that if any FTE the employer penalty would be $45,000. The employer could be receives a federal subsidy through the Marketplace for their QHP paying $500,000 annually for the coverage on its 65 FTEs. Those (the 400 percent FPL rule above), the employer would have an premiums would be tax-deductible to the business, but penalties annual penalty of $2,000 for each of their FTEs exceeding 30 are never deductible. overall (the employer gets to deduct 30 FTEs). That penalty is So, a penalty is not certain for the large employer that does pro-rated monthly. not provide health coverage in 2014, but unless their employees Here is an example: ABC, Inc. has 65 FTEs for all of 2014 are highly paid, the chances are very high. Remember that the and does not provide a QHP. One FTE receives a subsidy that year. FPL rule states “family income.” Do most employers know what ABC would have an annual, nondeductible penalty of $70,000 their employees’ spouses earn? Even thinking about asking would (65 - 30 = 35. 35 x $2,000 =$70,000). make any HR department cringe. A way for large employers that Part-time employees would play into the penalty as well, do provide a QHP to avoid any penalties would be to make sure but only in the organization’s definition as a large employer and premiums are not “unaffordable.” It would mean the employer not in the penalty calculation itself. The ACA has a complicated pays such a large portion of the FTEs “self-only premium” that “measurement” formula that is based on the employment hours the remaining portion it is not “unaffordable” to the employees. It of all part-time employees. At first glance, an employer with 40 will be essential for business owners to review the various options FTEs would not be thought of as a “large employer” under the with their financial professionals: CPAs, attorneys and healthACA, but the required “measurement” of their 20 or so part-time insurance agents. employees’ hours could push this employer into “large-employer” status. PREMIUMS AND COVERAGE Any and all part-time employees receiving a subsidy will It should be little surprise to anyone that premiums will be higher have NO penalty impact on their employer. Only FTEs receiving than in 2013. Many are speculating at least a 20 percent increase. a subsidy cause penalty concerns to the employer. As stated Why that much? First, consider the generally broader coverage earlier, the penalty to a large employer that does NOT provide for all QHPs (individual, small group and large group) will look coverage is calculated on the full-time employee count exceeding alike in their minimum coverage. Various states have the right to 30. The now large-employer status company would pay $20,000 require additional mandated coverage, but they cannot strip down (40-30=10. 10 x $2,000 = $20,000). a plan from set minimum levels by the ACA. Here is a basic list If the large employer does provide a QHP for the entire 12 months in 2014, they might still have employees receiving subsidies, and therefore would have a penalty. The rule is very complex, but basically provides that a FTE would be eligible for a subsidy if: 1) They are under the 400 percent FPL MANAGE COST rule, and; Improve cost effectiveness 2) The employer’s provided coverage Apply money to core business is not broad enough. For example, Economy of scale the insurance may not pay at least MANAGE RISK www.insitesupport.com 60 percent of covered healthcare Spreading of initial investment cost expenses for the typical population, Avoid non- core capital investments or; EXPEDITE EXECUTION 3) The cost of employees’ required Accelerate speed to market premium for the QHP is deemed Enhance product awareness “unaffordable.” Focus on core business competencies

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What is “unaffordable”? If the employee’s portion of the “self-only” coverage exceeds 9.5 percent of “household income,” then it is “unaffordable” as per the ACA. Should this happen (using the ABC, Inc., example), the employer’s penalty would be the lesser of $70,000 ([#FTE – 30] x $2,000) or $3,000 for every FTE receiving a subsidy. Assuming that 15 FTEs received

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IMPORTANT THINGS TO REMEMBER Qualified Health Plan (QHP) – The Affordable Care Act states that starting Jan 1, 2014 all individuals must purchase a Qualified Health Plan or face penalties referred to as “shared responsibility payments.” Federal Poverty Level (FPL) – Individuals with a family income below 400 percent of the Federal Poverty Level are eligible for premium subsidies for their QHP. Any employer penalties are based on whether they have any full-time employees receiving these subsidies. Large Employer – Defined as having 50 or more full-time employees, only large employers could be subject to penalties. Some employers with fewer than 50 full-time employees could still be defined as large employers depending on the number of part-time employees and their hours worked, but any penalties faced would still be calculated based only on the number of full time employees. Individual penalty calculations – Individuals that do not purchase a QHP would be facing an annual penalty of either $95 or one percent of their annual gross income, whichever is greater. Employer penalty calculations – Large employers that do not provide a QHP to employees or coverage provided is not broad enough or premiums are deemed “unaffordable” (see definition below) AND any of their full-time employees receive premium subsidies, they would be subject to an annual penalty of [# full time employees – 30] * $2,000. They would pay $2,000 a year for every full-time employee more than 30 overall. Large employers would also be subject to unspecified penalties if they do not extend coverage to dependents age 26 or younger. They are not required to extend coverage to spouses, however. Unaffordable premiums – If a full-time employee’s portion of self-only coverage exceeds 9.5 percent of their household income, their premiums would be deemed “unaffordable.” If their employer is defined as a large employer and the employee (or any other full-time employee) is receiving premium subsidies from the federal government, that employer would be facing penalties. Rating criteria – Starting Jan. 1, 2014 it will be unlawful for carriers to set premiums based on gender, pre-existing conditions or any underwriting questions. They will be allowed to charge up to 50 percent higher premiums for tobacco users. 12

South Carolina Agent & Broker • Fall 2013

that health-insurance carriers are using in their premium calculations: 1) Broader coverage; 2) No lifetime nor annual dollar limits on coverage; 3) No underwriting, pre-existing questions; 4) Guaranteed issue and renewal; 5) No out-of-pocket cost for preventive visits; 6) Children on the parent’s plan until age 26 (some exceptions); and, 7) Health-insurance carriers are being charged several billion dollars in additional taxes. There other areas that might make premiums even higher. One is the recently announced Transitional Reinsurance Fee to be imposed on all health-insurance carriers. It will be passed along to the individual or group plans. The monthly fee is $5.25 “per head” in 2014 (or $63 per head annually). In an example, say you have a business currently providing coverage for 40 employees. The employer pays 80 percent of employee premiums and none of the spouse/dependent costs. In addition to employee coverage, there are 30 covered spouses, 60 covered dependents, five COBRA-qualified beneficiaries and five retirement employees. You have 140 covered “heads,” and at $63 each would mean $8,820 added to your renewal premium in 2014. The three-year imposed fee drops to $42 in 2015 and then to $26 in the final year. Most of it will go back to health-insurance carriers to assist with the potential financial loss in the early years of the ACA due to guaranteed issue, adverse selections, etc. But regardless of its purpose, these fees will increase the overall cost of the QHP. Another increase in premiums allowed by the ACA should concern tobacco users. Carriers that file to write QHPs in 2014 can only use certain rating criteria. They cannot use gender or underwriting questions, and that means no pre-existing condition exclusions. They can use: • Age. Older individuals can be charged more than younger ones, but at a maximum of 3 to 1 ratio; • Geographic area. Premiums can be higher in certain cities; e.g. higher for New York City residents than Rochester, NY residents; • Family composition. Families of 3 or 4 can be charged more than an individual or family of 2; and • Tobacco usage with a maximum of 1.5 rating factor. Concerning the tobacco usage, note that it does not state “smoking.” It simply states “tobacco,” which would encompass any and all forms of tobacco usage. Here’s how it works: Assuming the annual cost for your current health-insurance plan in 2013 is $5,000, you can expect it to be $6,000 next year due to the reasons previously stated. However, if are a tobacco user the carrier could surcharge your base premium as much as 50 percent, and your new premium would be $9,000. Understand, a carrier may use a 1.5 factor; some will use the maximum, some may not. Another interesting bit of recently released information: those applying for an individual policy cannot receive any FPL subsidy

on the tobacco surcharge portion. So, in the previous example, if the individual is eligible for subsidies, only the $6,000 non-tobacco portion can be calculated for subsidies, not the $3,000 tobacco surcharge. If the tobacco user is part of an employee group, the same non-subsidy rule applies unless he/she enrolls in a “tobacco cessation” program. I find it interesting that the surcharge applies to tobacco usage, but is silent on marijuana or illegal-drug usage. Additionally, there have been no specific rules released on how the agent/company determines the tobacco usage and what would happen should the applicant lie about it. With life insurance, the carrier generally requires a urine exam and should there be a misrepresentation, the carrier can rescind the contract within the first two years. One additional release from Health and Human Services (HHS) in late December 2012 dealt with coverage on “dependents.” As you probably know, in 2010 the ACA mandated health-insurance coverage be extended to dependents until age 26, with minor exceptions. Now we have new “guidance.” Starting in 2014 all large employers (50+ FTEs) must extend coverage to dependents until age 26 or there will be financial penalties. There is no real change in the language except for the financial penalty part. The original law did not specifically state that an employer would have a penalty if coverage wasn’t extended. Another additional newsworthy rule is that an employer is not required to extend coverage to the spouse of an employee. I am interested to see how large employers approach this “spouse-coverage” exception. The ACA is still “evolving.” The 2,500+ page law was silent on numerous specific rules. While the law stated a particular provision, many times it did not give the exact amount of the fee, tax or penalty relating to the provision. Frequently the law states “to be determined by the Secretary of HHS.” Additionally, numerous lawsuits were filed, such as one that resulted in the “penalty if no dependent coverage to age 26.” Thus, clarification is expected on many fronts. So, expect more exact rules and definitions in the spring and summer of 2014. I regret leaving you with the fact that the final impact to insurance premiums in 2014 and the following years is still not clear.

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Fall 2013 • South Carolina Agent & Broker

When Is a Producer Required to be Appointed by a Carrier?

By Becky McCormick, CPCU, CIC, AAI, IIABSC Vice President

his question of when a producer is required to have a carrier appointment keeps coming up, so we thought it was time to review with both members and our company partners the SC regulation regarding carrier appointments. First, we need to determine when a producer license is required. SC insurance code Section 38-43-10 states that anyone who performs any of the following must have a producer license: 1. sells, solicits, or negotiates insurance on behalf of an insurer; 2. takes or transmits other than for himself an application for insurance or a policy of insurance to or from an insurer; 3. advertises or otherwise gives notice that he will receive or transmit insurance applications or policies; 4. receives or delivers a policy of insurance of an insurer; 5. receives, collects, or transmits any premium of insurance; or 6. performs any other act in the making of an insurance contract for or with an insurer, other than for himself; whether these acts are done by an employee of an insurer or at the instance or request of an insurer, must be an appointed producer of the insurer for which the act is done or the risk is taken unless provided otherwise in Section 38-43-20. Most independent agencies seem to be clear on when a producer license is required. The recent problem, which has caught the attention of the SC Department of Insurance, is that some carriers are not properly appointing producers. SC insurance code Section 38-43-50 outlines who must be appointed by a carrier and states in part: “An insurance producer shall not act as an agent of an insurer unless the insurance producer becomes an appointed agent of that insurer. An insurance producer who is not acting as an agent of an insurer is not required to become appointed.” What does this mean? It means ANY agency staff performing the duties that require a producer license for a

South Carolina Agent & Broker • Fall 2013

particular carrier MUST be appointed with that carrier. It does NOT mean that a carrier can appoint one or two people in an agency to “sign all the applications” and not appoint the other agency staff who are clearly performing the duties that require a license on behalf of a carrier. The latter is a clear violation of the insurance code and can result in fines of up to $5,000 against the agency and the producer, possible suspension or revocation of the producer’s license, fines up to $30,000 against the carrier and possible revocation of the carrier’s certificate of authority to operate in South Carolina. Another situation that has come up is carriers that do not want to appoint producers until business has been submitted. Section 38-43-50 does allow a 15-day window to appoint a producer under these circumstances: “To appoint a producer as its agent, the appointing insurer shall file, in a format approved by the director or his designee, a notice of appointment within fifteen days from the date the agency contract is executed or the first insurance application is submitted.” But keep in mind, the CSR or Account Manager who will be servicing the business and performing the functions that require a license will also need to be appointed with the carrier. In other words, if a producer license is required to perform an activity and an agency staff member is performing these activities on behalf of a carrier, they MUST be appointed with the carrier. One final note on appointments: the appointment fee must be paid by the carrier. It is a violation of the insurance code to force a producer or the agency to pay the appointment fee. IIABSC advises our members to discuss these issues with any represented carrier who may not understand the regulation so they can make the necessary appointments in your agency. Don’t risk incurring heavy fines or worse yet, losing your producer license, by not having the proper appointments. If any of our company partners have additional questions regarding the regulation on appointments, they should contact the SC Department of Insurance.

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Merging Agencies

Insights from the Experiences of Swiss Re Corporate Solutions Veteran Underwriters

ne of the biggest decisions of your professional insurance career comes when you decide to either sell the agency you’ve worked long and hard to create or to buy another agency that someone else has worked long and hard to create. You’ve met with the owners of the agency, you’ve looked at the book of business, you’ve agreed on a price, hopefully your attorney helped draft the buy/sell agreement and you’re a few short days away from closing the deal when suddenly someone asks: what about the E & O coverage? Who’s doing what? Are you going to pick up the prior acts or am I? Can we just transfer the E&O policy to the new owners? What kind of losses have you had? All of these questions should be asked at the beginning of the talks regarding the sale/purchase, because they can have a big impact on the deal. Unfortunately they usually aren’t discussed until the last minute. Think about this: when you buy a new car or sell your current one, one of the first things you should do is contact your insurance provider. It’s no different when you are buying or selling an insurance agency. It’s the same for when you are only buying or selling a book of business. Most E&O policies state that you must notify your E&O provider within 90 days of a merger or acquisition (check your policy to verify time limits). Failure to notify your carrier in a timely manner could result in a gap in coverage. So let’s go through the steps you should follow when you are making a life- and business-changing decision regarding your agency. When buying an agency You’ve been talking with a fellow agent about buying their agency for some time, and now you’ve both decided the time is right. There are many details to consider; the first of which is to do your due diligence to review the other agency’s operations, book of business, finances and E&O policy. At this point it is advisable to retain an attorney to help you through the process. However you and the seller should each seek separate counsel, because an attorney can only represent one party, not both. It’s also a good idea to have a confidentiality agreement with the seller so you can freely review all the documents necessary to begin the ownership change. After you’ve completed your due diligence and both are comfortable with all aspects of the agency, the attorneys will draft the buy/sell agreement. Included will be such things as the timing of the sale, the assets to be transferred, price and who is responsible for the liabilities of the selling agency. The cleanest way to do this is for each party to retain their own liabilities. The seller would purchase tail coverage, and the buyer would add the new book of business to their current E&O policy. Fall 2013 • South Carolina Agent & Broker

The reason this way is the cleanest is because the seller would have peace of mind in knowing that should a claim arise after the sale for acts while they owned the agency, their E&O policy would still provide coverage for them. For the buyer, they would know that they wouldn’t be responsible for any acts that occurred prior to the purchase. It would be true even if the selling agency continued as a separate entity for the buying agency. In most cases, even when the buyer maintains the new agency as a separate entity or location, it can be included on their current E&O policy for errors and omissions that are made after the sale. Another option, while not the best way to transfer ownership, would be for the purchasing agency to agree to accept responsibility for prior acts by adding the selling agency to the buying agency’s E&O policy. However, it must be approved by the E&O carrier before the sale is completed. (Another reason it is imperative to contact your E&O agent as soon as you begin the buy/sell process!) You will be required to provide a loss history of the seller, and the carrier may require an application providing information about the mix of business, gross annual premium, commissions, staff, etc. In some cases the carrier may not agree to provide prior acts due to claims history, nature of the book of business, etc. In that case the seller should purchase tail coverage from their current E&O carrier. One final thing to keep in mind is that the cost of tail coverage or additional premium expense if the prior acts are provided by the buyer can, and should, be considered in determining the sale price of the agency.

South Carolina Agent & Broker • Fall 2013

When selling an agency As a seller of an agency, you may think it important to maintain your agency’s legacy. If it is important to you, be sure to discuss it with your attorney so it is properly addressed in the agreement. If you have valued employees you wish to provide for, you should include how they will be taken care of in the agreement. It could be a source of negotiation as the seller may not wish to add any permanent staff, so make sure it is brought up in your discussions with the buyer. An important aspect mentioned previously is protection for you if a claim should arise after the sale. Again, the best way to ensure this protection is to purchase tail coverage from your current E&O carrier. While you may not want to add the expense and you think you are protected enough through your agreement with the buyer (they will provide coverage for prior acts and maintain an E&O policy), you have no guarantee it will be done. It is not unheard of for the buying agency to either go out of business after the sale, sell their agency to another party not agreeing to provide prior acts, or have their E&O policy terminate. In each of these cases you could be left without coverage. Another thing to consider is whether your agency should be added as an additional insured on the buyer’s policy so that any claims, regardless of whether they are for your agency or the buyer’s agency, would be subject to the policy limit of the buyer’s policy, even if it results in multiple claims. In other words, are you comfortable that the policy limits of the buyer’s

E&O policy are sufficient to cover both yours and their claims? It also should be made clear who would be responsible for any deductible payment.

both parties, attorneys should be retained, agreements drafted and entered into and all other aspects of the change of ownership should be carefully contemplated and resolved.

Mergers If you are merging with another agency to either form a new agency or be a continuation of one of the two, there are different ways to handle it in regard to E&O coverage. One way is to have a new E&O policy for the newly created entity. This option ensures a clean slate for all involved. If a new policy is created, each of the former agencies could purchase tail coverage or could be added as additional insureds on the new entity’s policy. Again, keep in mind that any claims would be subject to the limits of the remaining policy, which must be approved by the E&O provider prior to the completion of the agreement (to ensure that the carrier could comply). Another way to handle a merger is to terminate one policy and have that agency added as an additional insured to the policy of the “surviving” agency. The agency terminating their policy could either purchase tail coverage or be added as an additional insured upon approval by the E&O provider.

Transfer of a book of business Remember that even if all you are doing is transferring a book of business, either as a buyer or a seller, all of the things mentioned previously still apply. While you might think that a transfer of only a small book of business should be uncomplicated, as soon as a claim is made it can become very complicated indeed.

Internal sale Many times an owner has a key agency employee they believe is qualified to take over the agency. Everything already stated also applies in this situation. There should be due diligence by

Three key points to remember 1. Consult your attorney and have a formal written agreement outlining the duties and responsibilities of all parties. 2. Contact your E&O provider as soon as possible to ensure that coverage can be provided as you intend and there are no coverage gaps. 3. Giving timely notice to your E&O provider is of utmost importance as many carriers may be unable to comply with your intent after the transaction has been completed. You spent your professional insurance career building a business that provided you with a livelihood and personal fulfillment. If you are either growing or selling your agency, you want peace of mind in knowing that you have adequately protected yourself.

Fall 2013 • South Carolina Agent & Broker

Fall 2013 â&#x20AC;˘ South Carolina Agent & Broker

SC Trusted Choice® Big “I” National Championship June 24–25, 2013

Orangeburg Country Club, Orangeburg, SC

Austin Zoller, 17, of Summerville, SC, and Annika Bovender, 16, of Mt. Pleasant, SC each shot a 145 combined score to top their respective divisions in the SC qualifier of the Trusted Choice® Big “I” National Championship held June 24–25 at the Orangeburg Country Club in Orangeburg, S.C. Second place for the boys was Cole Patterson, 16, of Greenville, SC, with a two-day score of 146. Third-place boys’ after a two-hole playoff was Zachary Herold, 17, of Lexington, SC, with a final score of 147. These four teenagers earned the chance to advance to the Trusted Choice® Big “I” National Championship held Aug. 5-8 at Pinehurst, NC. They were joined by Keenan Huskey, 16, of Greenville, who played in the national tournament last year and automatically qualified to play. Zoller is the third person in his immediate family to play in the national Trusted Choice® Big “I” National Championship. His father played in the 1983 tournament held in California, and his brother Taylor Zoller played in the 2010 tournament held in New Jersey after winning the SC qualifier. Keenan Huskey tied for third place in the boys division of the national tournament. Based on the final scores, he and Austin Zoller automatically qualified to play in the 2014 tournament to be held at the Pete Dye Club in Bridgeport, W.V. This tournament is a community-service project sponsored by the SC Trusted Choice® Agents. View photos and full final results at www.iiabsc.com/jrgolf. 22

South Carolina Agent & Broker • Fall 2013

Thank you, Sponsors Access Insurance Company AFCO/Prime Rate Premium Finance American Modern Ins. Company American Strategic Ins. Auto-Owners Insurance Company Bankers Insurance Group Berkley Mid-Atlantic Group, LLC Builders Mutual Capitol Preferred Insurance The Colonial Group FirstComp Foremost Insurance Group Frontline Homeowners Insurance Gill Insurance, LLC Hanover Excess & Surplus The Hartford IIABSC Agency Jackson Sumner & Associates JM Wilson Johnson & Johnson Liberty Mutual Main Street American Group Mid-Continent Group National Security Fire & Casualty Co. Phenix Mutual Fire Ins. Co. Preferred Specialty, LLC Progressive Insurance RPS Continental Southern Cross Underwriters Southern Insurance Underwriters State Auto Insurance St. Johns Insurance Co. Tapco Underwriters Travelers United Property & Casualty

Becoming a Social Business:

ASuccess Model for

By Rick Morgan, ACT Social Web Work Group Chairman

“

A social business is one that possesses the culture, organization and processes to thrive in the current environment, characterized by rapid change and the emergence of the “connected society.” This article defines what is meant by a social business and then describes how it is different from traditional hierarchical businesses. A complete picture of what social businesses ultimately will look like is still evolving, but the article points to the many exciting things agencies and other businesses are already doing to transform themselves into more flexible, social and collaborative organizations.

Neither do men put new wine into old bottles: else the bottles break, and the wine runneth out, and the bottles perish: but they put new wine into new bottles, and both are preserved.” (Matthew 9:17, King James version of the Bible) This parable accurately identifies the dynamic our industry grapples with as it tries to adapt, stay relevant and make sense of the many challenges it faces in today’s rapidly evolving business environment. More often than not, agencies try to make social and mobile technologies work within the constructs of outdated business models, organizational structures and traditional processes. The resulting effort fails. For example, social media is treated simply as a marketing tactic: a Facebook Page is launched and an administrative employee is put in charge. Disruption in day-to-day office procedures results with little if any real benefit. Clearly, there is a difference between organizations that simply engage in social activity and execute social media tactics, and those that actually become social businesses. WHAT IS A SOCIAL BUSINESS? A Google search will turn up hundreds of definitions. Understanding what a social business model is and how it differs from a traditional business model is not simple. The concept is new and still evolving. Yet, the definition below is a good start. I have followed Amber Naslund for the past four years and consider her to be a pioneer in this space: Fall 2013 • South Carolina Agent & Broker

Social Business is the creation of an organization that is optimized to benefit its entire ecosystem (customers, employees, owners, partners) by embedding collaboration, information sharing, and active engagement into its operations and culture. The result is a more responsive, adaptable, effective and ultimately more successful company.

become involved and demonstrate the behaviors that drive change. This practice is often referred to as “transformational leadership,” where the leader provides employees with an inspiring mission and vision for the organization and encourages them to challenge the status quo and to alter the landscape in which the business competes.

Social business can encompass using external social media, but it’s not a requirement. Technically, an organization can be a social business without engaging publicly in social media at all. -- Amber Naslund, President, Sideraworks

WHAT DOES A SOCIAL BUSINESS LOOK LIKE? It is difficult to understand exactly what a social business is and how it differs from traditional business some examples of the operational and organizational changes a growing number of agencies are already making in that direction.

The concept of social business is more than theory. A growing number of agencies understand that their business must be transformed or reinvented. They realize the need for a comprehensive social strategy that is clearly aligned with business goals. (Too often this is not the case. An Altimeter survey of nearly 700 social media professionals and executives found that only 34 percent of businesses felt that their social strategy was connected to business outcomes.) Further, these agencies have senior management involvement, organizational alignment and operational processes in place that enable execution of their social strategy. They know that use of new technology as well as social and mobile initiatives will only be successful if there is an organizational and cultural transformation that changes the way employees work, interact with one another and communicate with customers and prospects – in essence, a reinvention of the agency. The concept of reinvention is not new to our industry. When we first started installing agency management systems, we found that there was a big difference between just using automation vs. becoming an automated agency. Remember Transactional Filing? Only when agencies reinvented operational processes and procedures did their technology investments start paying off. Only when management became involved did agency management systems transition from being primarily accounting systems to tools that supported agency service, sales and marketing activities. As difficult as process change is, changing an agency culture is even harder. It all starts with leadership. LEADERSHIP Charlene Li, founder of Altimeter Group and Keynote speaker at the 2013 ACORD Insurance Systems Forum said the following about social business adoption: “The biggest determinants, by far, of whether you will be successful at social business are leadership and culture.” As mentioned above, all the technology in the world is useless if operational processes and organizational behaviors aren’t changed. Change starts from the top. That is, success depends on change management initiatives being driven by agency leadership and practiced at every level from senior management down to customer service and support personnel. Thus, executives must not only talk about changing the organization; they must also 24

South Carolina Agent & Broker • Fall 2013

Trust Employees Empower and trust your employees to participate on social sites on the agency’s behalf and trust that they will do the right thing. Consider starting a blog and use it to educate your customers and prospects and demonstrate your subject matter expertise. But also use it to build and strengthen your brand personality. Agency staff will be the foundation for building a fully collaborative social business. A shift in employee behavior becomes a key success factor in driving organizational change. Encourage your employees to build personal brands on social sites. Make it clear that opting out of social networking activity is not an option. Successful social businesses depend upon a team effort. They create processes that support organizational consistency. For example, when a new employee joins the agency and wants to start blogging and Tweeting for the agency, a process should be in place that governs employee training and certification in the agency’s social media policy. (View ACT website for a guide to creating a social media policy.) Flexible and responsive work The incoming workforce will demand a more open and flexible work environment. Options as to how, when, and where work happens are expanded. New models in the form of small virtual offices, expanded geographic locations, flexible work hours, 24/7 availability, outsourcing, niche or expertise-driven agents are transforming how we define work. For example, becoming a social business means in addition to using social tools to create personal brands, producers would spend less time behind desks and more time in the field making real-life contact, meeting in places like Starbucks. Collaborative work environment The new social and connected cultures have set new expectations when it comes to speed of communication and response. Information must be made available and shared, not hoarded or restricted. In fact, many agencies are inviting customers to participate in agency decisions. For example, they have customers sit on the agency’s board of directors or participate in advisory councils.

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Become transparent in your communication. Customers and employees expect to communicate more seamlessly and develop personal relationships. Agencies have found that it is one of the best ways to build trust. Community Involvement Become personally involved in your real-life community, including active involvement and support of charitable initiatives. The profiles of successful agencies reflect social values embedded in the core of the organization. It is also a key value for customers; they want to do business with a socially responsible company. Technology Technology alone will not change an organization’s culture. However, having a strong understanding of your agency’s cultural objectives will have an impact on your technical requirements, implementation and configuration. Clearly, there will be need for agency management system technology and the facilitation of collaboration to support the new social business model. Responsive Marketing Most personal lines and small commercial customers are interacting with agents and insurers across a full range of channels: in-person, mobile device, phone and even broadcast through services like Skype or Google Hangouts. It is necessary to understand your customer and adjust your marketing and communications accordingly. Shift marketing dollars from traditional marketing channels to digital ones. Know the communications preferences of your clients and offer communications from a wide variety of devices. Reinventing Agency Processes We need to think through how many of our everyday processes should change by the new technologies available to us. Everything from managing passwords, e-signatures, certificates of insurance, ID cards, online self-service, mobile options, policy delivery, billing and payment options and even coverage offerings must change to meet current customer service expectations. SUMMARY It is important to remember that consumer expectations are set by the culture, not the industry. The culture is shaped by new technologies and innovative applications of those technologies by other industries and social institutions. We have become 26

South Carolina Agent & Broker • Fall 2013

a “social culture” and a “connected society,” where consumers are increasingly connected and empowered through changing technology to interact with and shape the world around them. Local agents are not on the verge of extinction, but we do need to change and adapt with the times. We are already past the theoretical stage – there are a growing number of agencies already making the shift. Agencies that are able to make the transition and become social businesses will be well positioned to meet the challenges of the new business landscape and the demands of the new social culture and connected society. Tying this to the opening parable, they are putting new wine in new bottles. For additional examples as to how agencies are reinventing themselves for the future, please see the ACT website, www .iiaba.com/act. Rick Morgan (rick@Aartrijk.com), in addition serving as a consultant to ACT and chairing the ACT Social Web Work Group, is senior vice president with branding consultancy Aartrijk. He has four decades of experience in innovative technology, marketing, and publishing in the independent insurance agency system. This article reflects the views of the author and should not be construed as an official statement by ACT.

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Fall 2013 • South Carolina Agent & Broker

2013 Big “I” SC Congratulations to new designees!

August 20, Doubletree, Columbia, SC

AAI

Robert B. Jurick, AAI Matthew Trainor, CISR, AAI

AIAM

Sonya Aull, CISR, AIAM Barbara Ard, AIAM Sharon Blackwell, CISR, ACSR, AIAM Falicia Diane Bolton, AIAM Faye Buddin, CISR, ACSR, AIAM Angela Cooper, CISR, AIAM Robin Few, AIAM Laurie Fite, CIC, CISR, AIAM, CPIW, AU Patricia Hartley, AIAM Elizabeth A. Huffman, AIAM Vicki S. Johnson, AIAM Kerry L. Kinsey, CISR, ACSR, AIAM Lynn Laag, AIAM Jennifer Lendway, AIAM Nancy Shealy, AIAM Nicole Sword, CISR, AIAM Sharyn Twedten, AIAM Tara Twedten, AIAM

CIC

J. Fletcher Anderson, III, CIC Anastasia M. Bennett, CIC, CISR Laura D. Cornell, CIC Tim Harris, CIC, AU Jackie Dale Holladay, Jr., CIC Brian McGilvray, CIC Jo Marie Mercer, CIC Andrew E. Muller, CIC, AAI, CWCC Shelia Rishel, CIC Kimberly E. Taylor, CIC, CISR, AAI

CISR

Mary K. Adams, CISR Tara Sparks Alford, CISR Amanda C. Altenburg, CISR Teresa Ann Anderson, CISR Carolyn Renee Bannon, CISR Katherine A. Berry, CISR Sarabeth M. Brinson, CISR Ellen G. Brown, CISR Dominique Christine Clements, CISR Monica L. Cross, CISR Sabrina B. Crump, CISR Patricia Ruth Dunn, CISR 28

South Carolina Agent & Broker • Fall 2013

Kristin B. Dupont, CISR Karen D. Fenters, CISR Melodie Milkie Floyd, CISR Katherine Thomas Fowler, CISR Sandra L. Frazier, CISR Samantha K. Freeman, CISR Lindsi Faye Gainey, CISR, CPSR Alison Miller Gardner, CISR Barbara C. Garrett, CISR Melody Anne Graves, CISR Nichole Maxson Haddock, CISR Karla S. Hartin, CISR Angelia A. Hickman, CISR Brook Taylor Johnson, CISR Ashley S. Kendrick, CISR April Nealy Lewis, CISR Brantlee Boozer Lybrand, CISR Catherine Marie Matyniak, CISR Charlotte Dennis Mims, CISR Courtney Marie Myers, CISR Karen B. Pearce, CISR Kadi M. Quinn, CISR James Adam Renken, CISR Rebecca Claire Reynolds, CISR

Mary K. Rothwell, CISR Rhoda M. Ryan, CISR Bonnie D. Schattle, CISR Marianne Forbes Todd, CISR, AU C. Dawn Williams, CISR, CRIS

CSRM/CRM

Anthony S. H. Catone, CRM David Hey, CIC, CRM, ARM Mark a. Maenche, CIC, CRM Kathy D. McKay, CIC, CRM, CPIW Jarrett Robinson, CIC, CRM

IIABSC Executive Leadership Kymberley Bigda Kristie Hendrick Mark Maenche, CIC, CRM Tracy Mau, CISR, CRIS Gail Mishoe, CIC, CISR Ben Myers, AIP Alice Seel, CIC Bill Silcox, AIAM Reina Sowers, CISR Matt Wiseman, CIC, CISR

View more photos at www.iiabsc.com/designations

Kadi Quinn, CISR

2013 SC Outstanding CSR of the Year Award Kadi Quinn, CISR, of McKay Insurance in Mt. Pleasant has been named the 2013 SC Outstanding Customer Service Representative of the Year. This award is the highest honor in our state for insurance customer service reps who have distinguished themselves though contributions to their industry and profession. She was recognized at this year’s annual Education Awards Luncheon held Aug. 20 in Columbia. Once nominated, Kadi was required to write an essay from the following prompt: Communication is one of the most important parts of building strong relationships with your clients, companies and coworkers. Identify and explain the four greatest barriers to effective communication that you face (or have faced) and how you’ve worked to overcome these barriers. Below is the winning essay written by Kadi. In fact, her response was so good that she was a finalist for consideration of the National Outstanding CSR of the Year award through the National Alliance for Insurance Education and Research. Congratulations Kadi!

(Winning Essay)

Overcoming Communication Barriers in the Workplace

ommunication is defined as the process by which information is exchanged between two individuals through a common system of symbols, signs or behavior. It is arguably the most important part of building strong relationships with clients and colleagues. There are many barriers to communication that can affect the relationships formed in the workplace. Four of the greatest barriers to communication that I have faced and overcome during my career are: the use of technical jargon, the use of email, time constraints and personality and psychological trait barriers. The use of technical jargon is an especially important barrier to be aware of in the insurance industry. Insurance verbiage is a foreign language to most clients and if used predominately by an insurance professional, it can create a disconnect and the message may be lost in translation. To help overcome this barrier, I cultivate my knowledge of our evolving industry through continuing education classes and keeping up-to-date on industry trends and hot topics. This knowledge allows me to translate the technical jargon into simpler terms allowing the client to be

a part of the conversation and truly understand the information. By avoiding the use of technical jargon, I am able to build more personal relationships with my clients – they feel as though they can talk to me and they trust that I will guide them in making the best decisions concerning their insurance. Technical jargon can cause confusion in both oral and digital communication. As the use of digital communication tools continues to rise, so do the barriers associated with it. Digital methods of communication, specifically email, can be barriers, as information and emotion can sometimes be interpreted incorrectly and often misconstrued. Email is widely used in the workplace and many insurance professionals are now using it as their “go to” form of communication. The widespread use of email can be a major hazard in this industry, since customer service situations arise that require face-to-face or verbal communication. To overcome this digital communications barrier, I carefully craft emails so they are concise and to the point, as to avoid any underlying emotions that could be interpreted incorrectly. Fall 2013 • South Carolina Agent & Broker

Chairman of the Board, Ashley Brady, CIC, presents Kadi Quinn with Outstanding CSR of the Year Award Additionally, I determine which situations are more appropriate for different styles of communications. Email can act as a catalyst to another communication barrier in the workplace, the pressure of time constraints. Large workloads can create a sense of urgency and cause professionals to move through their work swiftly, often resulting in mistakes. This pressure can act as a communication barrier by not allowing the intended message to be relayed fully. To overcome this barrier in the workplace, I make task lists and prioritize time for each task based on importance. By organizing my workload this way, I am able to divide and conquer without feeling the full pressure of time constraints and relay the intended messages to the recipients in their entirety. Depending on their personality and psychological traits, some people think you are not giving them enough attention if you are consistently giving into time pressures. Personality and psychological traits alone can be barriers to communication in the workplace. Professionals should be mindful that each person brings with them certain traits that require different types of communication. Some clients or colleagues may require more explanation, are easily angered or offended, etc. As professionals in the service industry, it is our duty to create meaningful relationships with clients and we are able to do this by adapting to their various personality traits. I listen to my clients’ needs and tailor my communication style to each individual person. Working in a customer service industry, communication barriers are endless. I overcome various types of barriers on a daily basis. Overall, by always treating clients and colleagues with respect, most barriers will dissolve themselves.

South Carolina Agent & Broker • Fall 2013

Get to Know Utica! We’re not a household name. We don’t have a 40-story home office in a big city. But we’re a household name to the agents who sell our products and their clients who buy our insurance. We are a multi-regional carrier with great products. We stay close to our agents. And we’re consistently noted for the high quality of our service, whether it’s our specialized loss control work or the fast, fair work of the Utica Claims staff. Open the door to more sales and revenue for your agency. Call me today to find out what Utica can add to your agency! Matt Lupino — Resident Senior Vice President Utica National Insurance Group 1100 Boulders Parkway, Suite 300, Richmond, VA 23225 Phone: 804-560-6620 • Matt.Lupino@uticanational.com

2013

Conference Thank you, Sponsors Access Insurance Company AFCO/Prime Rate Premium Finance American Strategic Insurance AssureSouth Auto-owners Insurance Bankers Insurance Group Berkley Mid-Atlantic Group Bituminous Casualty Corp. Burns & Wilcox, Ltd. Capitol Preferred Ins.Co. Capitol Special Risks FirstComp Foremost Insurance Group Frontline Homeowners Insurance Hanover Excess & Surplus, Inc. The Hartford Hull & Co., Inc. IIABSC Agency Imperial Prem. Financing Specialists J. M. Wilson Jackson Sumner & Associates Johnson & Johnson, Inc. Liberty Mutual Main Street America Group Mid-Continent Group National Security Fire & Casualty Phenix Mutual Fire Ins. Co. Preferred Specialty, LLC Progressive Insurance RPS Southern Cross Underwriters Southern Insurance Underwriters St. Johns Insurance Company State Auto Insurance Company Summit Consulting, Inc. Tapco Underwriters Travelers United Property & Casualty Ins. Fall 2013 â&#x20AC;˘ South Carolina Agent & Broker

South Carolina Agent & Broker â&#x20AC;˘ Fall 2013

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Fall 2013 • South Carolina Agent & Broker

Member News Welcome New Agency Members At Your Service, Inc. Spartanburg

Summit Insurance Agency Mt. Pleasant

Crown Insurance Agency, LLC Charleston

Swamp Fox Agency Moncks Corner

Welcome New Associate Members Haulers Insurance Company Columbia, TN

ISU Agency Network San Francisco, CA

Ink Underwriting Kennesaw, GA

Prime Insurance Company Sandy, UT

Regions Insurance Establishes Office in South Carolina Regions Insurance has established a new office in Columbia, SC through IIABSC member agency Frank B. Norris & Co, who is now operating under the new name. Their specialties include residential homebuilders, trade contractors and property. This expansion is the third significant addition to Regions within the past nine months as part of a Southeast expansion. They also opened offices in Atlanta, Ga., and an employee benefits practice in Memphis, Tenn.

Congratulations to the following IIABSC member agencies who have been named Best Practices Agencies and will participate in the Big “I” national study of top performing agencies. Only 216 agencies were chosen to participate from 1,100 applicants. Congratulations! Anderson Insurance Associates The Bynum Company CWS Insurance Agency Herlong Bates Burnett KeenanSuggs Peoples Underwriters Rosenfeld Einstein

South Carolina Agent & Broker • Fall 2013

The SC Home Builders Self Insurers Fund and sponsoring insurance agencies awarded six South Carolina students with $1,000 college scholarships. Selected by an independent judging panel, recipients were selected based on their commitment to educational excellence, community service and extracurricular activities. Sponsoring IIABSC agency members include Regions Insurance in Columbia and John T. Cook & Associates in Myrtle Beach.

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Elba, Alabama • 800-239-2358

Fall 2013 • South Carolina Agent & Broker

Calendar View up-to-date calendar, course descriptions and register using our online Education & Event Calendar at www.iiabsc.com/education CLASSROOM COURSES WEBCAST/WEBINAR - no test required for CE Credit

m m October

6-8

CIC: Commercial Casualty, 20 hrs. P&C, Hilton Head

E&O Risk Management Webinar – Part I, 3 hrs. P&C

Surplus Lines License Review Course, 3 hrs. P&C

E&O Risk Management Webinar – Part II, 3 hrs. Ethics

CISR: Commercial Casualty-1, 7 hrs. P&C, Charleston

CISR: Commercial Property, 7 hrs. P&C, Myrtle Beach

Insurance and the Property Lease, 2 hrs. P&C

2-4

CIC: Life & Health, 20 hrs. L&H, Myrtle Beach

Ethics & Business: Is This an Oxymoron?, 3 hrs. Ethics

Ethics & Business: Is this an Oxymoron, 3 hrs. Ethics

CISR: Personal Lines – Miscellaneous, 7 hrs. P&C, Myrtle Beach

National Healthcare Reform – Part I, 2 hrs. L&H

Business Income: Beyond the Basics, 3 hrs. P&C

Retirement Planning and Annuities, 2 hrs. L&H

Workers Compensation: Beyond the Basics, 3 hrs. P&C

Certificates of Insurance, 3 hrs. P&C

Executive Leadership Program Session 3, Columbia

Liability Issues to Worry About, 2 hrs. P&C

Hot Topics in Personal Lines, 2 hrs. P&C

National Healthcare Reform – Part II, 2 hrs. L&H

E & O Risk Management, 3 hrs. P&C, 3 hrs. Ethics, Greenville

Executive Leadership Program, Session 2, Columbia

Those Kids and their Cars, 2 hrs. P&C

13-15

IIABSC Annual Convention, Asheville, NC

E&O Mock Trial, 2 hrs. P&C

Surplus Lines License Review Course, 3 hrs. P&C

AIAM Day 6, 2 hrs. P&C, 3 hrs. Ethics, Columbia

Building Codes are BAD for your Insureds, 2 hrs. P&C

Agency-Management-Based E&O and Ethics, 3 hrs. Ethics

COPE: Property Underwriting & Effective Loss Control, 2 hrs. P&C

E&O Risk Management Webinar – Part II, 3 hrs. Ethics

Commercial Lines Claims that Cause Problems, 2 hrs. P&C

E&O Risk Management Webinar – Part I, 3 hrs. P&C

CISR: William T. Hold Seminar, 8 hrs. P&C, Florence

Directors & Officers Liability Insurance, 2 hrs. P&C

Top 5 Uses for Life Insurance, 2 hrs. L&H

E&O Risk Management Webinar – Part II, 3 hrs. Ethics

December

E&O Risk Management Webinar – Part I, 3 hrs. P&C

E&O Risk Management Webinar – Part II, 3 hrs. Ethics

CISR: Elements of Risk Management, 7 hrs. P&C, Columbia

E&O Risk Management Webinar – Part I, 3 hrs. P&C

Agency-Management-Based E&O and Ethics, 3 hrs. Ethics

CISR: Agency Operations, 6 hrs. P&C or L&H, 1 hr. Ethics, Greenville

E&O Mock Trial, 2 hrs. P&C

Retirement Planning and Annuities, 2 hrs. L&H

23-24

Personal Lines Nuts & Bolts, 12 hrs. P&C, Columbia

Surplus Lines License Review Course, 3 hrs. P&C

Est. Planning Techniques: Gifts Trusts & Life Ins, 2 hrs. L&H

Building Codes are BAD for Insureds, 2 hrs. P&C

Directors & Officers Liability Insurance, 2 hrs. P&C

Certificates of Insurance, 3 hrs. P&C

E & O Risk Management, 3 hrs. P&C, 3 hrs. Ethics, Charleston

Liability Issues to Worry About, 2 hrs. P&C

Personal Lines Claims that Cause Problems, 2 hrs. P&C

COPE: Property Underwriting & Effective Loss Control, 2 hrs. P&C

National Healthcare Reform – Part I, 2 hrs. L&H

Executive Leadership Program Session 4, Columbia

National Healthcare Reform – Part II, 2 hrs. L&H

CISR: Agency Operations, 6 hrs. P&C or L&H, 1 hr. Ethics, Charleston

Top 5 Uses for Life Insurance, 2 hrs. L&H

November

E&O Mock Trial, 2 hrs. P&C

Data Privacy Insurance, 2 hrs. P&C

CISR: William T. Hold Seminar, 7 hrs. P&C, Rock Hill

Personal Lines Claims that Cause Problems, 2 hrs. P&C

E&O Risk Management Webinar – Part I, 3 hrs. P&C

Ethics & Business: Is This an Oxymoron?, 3 hrs. Ethics

E&O Risk Management Webinar – Part II, 3 hrs. Ethics

Agency-Management-Based E&O and Ethics, 3 hrs. Ethics

Business Auto Claims that Cause Problems, 2 hrs. P&C

NFIP Basic Course, 3 hrs. P&C

Certificates of Insurance, 3 hrs. P&C

Est. Planning Techniques: Gifts Trusts & Life Ins, 2 hrs. L&H

CISR: Commercial Casualty-1, 7 hrs. P&C, Greenville

E&O Risk Management Webinar – Part I, 3 hrs. P&C

CISR: Commercial Causalty-2, 7 hrs. P&C, Columbia

E&O Risk Management Webinar – Part II, 3 hrs. Ethics

South Carolina Agent & Broker • Fall 2013

Independent Insurance Agents & Brokers of SC

Palmetto Partners Program IIABSC offers a special thanks to our 2013 Palmetto Partners

The program was created as a simplified way for companies, brokers and vendors to support the association and all our major conferences and events on an ongoing basis.

Diamond Level

Johnson & Johnson United Property & Casualty IIABSC Agency

Platinum Level

Bankers Insurance Liberty Mutual Insurance Progressive Insurance

Gold Level

Now accepting 2014 pledges

iiabsc.com/partners

Bronze Level

Access Insurance Co. Auto-owners Insurance Company Berkley Mid-Atlantic Group, LLC Capitol Preferred Insurance FirstComp Foremost Insurance Group Hanover Excess & Surplus

Jackson Sumner & Associates St. Johns Insurance Company

Silver Level

AFCO/ Prime Rate Premium Finance American Strategic Insurance Frontline Homeowners Insurance Main Street America Group National Security Fire & Casualty Preferred Specialty, LLC RPS Continental Southern Cross Underwriters Travelers The Hartford J.M. Wilson Mid-Continent Group Phenix Mutual Fire Ins. Co. State Auto Insurance Companies Southern Insurance Underwriters Tapco Underwriters Download forms and program benefits at:

www.iiabsc.com/partners Fall 2013 â&#x20AC;˘ South Carolina Agent & Broker

2013 Board of Directors Executive Committee Chairman Ashley Brady, CIC First Charter Co., Inc Marion, SC abrady@firstcharterins.com

National Director Jon A. Jensen, AAI, AIP Correll Insurance Group Spartanburg, SC jjensen@correllinsurance.com

Chairman Elect/ Treasurer Kenneth A. “Ken” Finch, CPCU, CIC, CRM, AAI Countybanc Insurance Greenwood, SC kfinch@ecountybanc.com

Immediate Past Chairman Kathy D. McKay, CIC, CPIW McKay Insurance Mt. Pleasant, SC kmckay6681@aol.com

Secretary R. Scott Moseley Irmo Insurance Agency Irmo, SC scott@irmoins.com

Directors William J. Bowers, AIP (Will) Russell Massey & Co., Inc. Columbia, SC will@russellmassey.com

Kimberly J. Gore, CIC (Kim) HUB International Southeast Myrtle Beach, SC kim.gore@hubinternational.com

Angus M. Brabham, IV, CIC (Gus) Frank B. Norris & Co. Columbia, SC gbrabham@frankbnorris.com

Dana D. Groome, CIC, CPCU, CISR, ACSR Peoples Underwriters Inc. Conway, SC danag@peoplesunderwriters.com

J. Robert Bryant, Jr. (Bobby) Robert Bryant & Son, Inc. Orangeburg, SC bobby@robertbryantandson.com Stephen B. Cannon, PhD, CPCU (Steve) Law Insurance Agency, Inc Spartanburg, SC scannon4@juno.com Harrison G. Cline, CIC, AIP The Furman Co. Insurance Agency Greenville, SC hcline@furmanco.com

Willard A. Silcox, III, ACSR (Bill) C.T. Lowndes & Company Mt. Pleasant, SC bsilcox@ctlowndes.com Richard L. Walker, CIC Cormell Street & Patterson Florence, SC rwalker@csp4me.com

800-226-3224 www.fcci-group.com

INDUSTRY EXPERTISE. PERSONAL SERVICE.

“I have a sincere passion for helping FCCI policyholders manage risk and prevent loss. The best phone call I’ve gotten started with the words, ‘Brad, you saved my life.’ ” Brad Ross, ARM, AIS Loss Control Manager FCCI Southeast Region Duluth, Georgia Now, let’s talk about your business. General liability • Auto • Property • Crime Workers’ compensation • Umbrella Inland marine • Agribusiness • Surety Coverage available in 17 states. © 2013 FCCI

IASC13_Ross_7.675x4.9.indd South Carolina Agent1 &

Broker • Fall 2013

8/12/13 10:16 AM

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