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STREET WISE Alliance of Insurance Agents of NC
HEALTH CARE REFORM & DEFINED CONTRIBUTION Can your agency afford to offer health insurance to employees?
Yes … or No? Regardless of the answer, one of this year’s new Alliance of Insurance Agents of NC (AIANC) member benefits is a customized program that combines employer’s defined contribution and the employees’ new individual tax subsidies for health insurance.
Do you have commercial clients? Regardless of whether you are licensed in Health Insurance or P&C only, AIANC members can help their commercial clients set up a free defined contribution program that is tax deductible to the business, 100% taxfree to employees and guaranteed issue health insurance without regard for pre-existing conditions.
AIANC Membership has More Advantages! Contact Eddie K. Emmett, Communications Director at eddie@FYIExpress.com for more information.
AIANC has a series of videos, webinars and training kit to show you how to do it.
HEALTH REFORM’S TAX SUBSIDIES
All it takes is to be a member in good standing with AIANC and the desire to help your clients while making a ton of money.
Your Key to Better Benefits & Happier Employees
AIANC’s STREET WISE
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Health Care Reform Overview The major provisions of the Affordable Care Act (ACA) take effect January 1, 2014. Starting in 2014, the best decision for most employers and employees might be to eliminate their company- sponsored group health insurance in favor of a defined contribution health plan solution. That’s because employees no longer need employers to purchase quality health insurance. And, starting in 2014, employees earning less than 400% of the FPL (~$95,000 for a family of four per year in 2013) who purchase an individual health policy will receive a large federal subsidy on their premium if their company doesn’t offer a group health insurance plan. In order to evaluate how health care reform affects you and your company, you must understand the following major ACA provisions:
Employer Mandate – 2015 (50+ FTE Employees Only) Employer’s Common Objections to providing Health Insurance for Employees
Businesses (with 50+ FTE) will be required to offer “qualified” and “affordable” health insurance to employees starting in 2015. If they do not, they are subject to a tax penalty based on full-time employees.
1. We can’t afford health benefits. This is a new federal program. With this solution, there are no minimum employer contribution requirements.
Small Businesses (with less than 50 FTE) are not affected by the mandate or the tax penalty.
2. We do not offer health insurance. That’s great. Our program should be able to help you save money on taxes on your employee’s individual health insurance.
Individual Mandate Starting in 2014, most individuals will be required to be covered under health insurance, or else pay a tax penalty.
3. This sounds like it will take a lot of time. We hear that a lot. The solution takes less than 5 minutes per month to administer (there is zero paperwork).
Individual Health Insurance Tax Subsidies To help make health insurance policies affordable, tax subsidies will be available to the majority of employees (households with income up to 400% of the federal poverty line, FPL). The federal poverty level varies by family size. In 2013, it is $11,490 for a single adult and $23,550 for a family of 4.
4. I already pay directly for my employees’ individual health premiums. You might want to check with your CPA to verify that you have set up the required plan documents to make it taxfree. Employer’s Common Questions to providing a Defined Contribution Health Plan for Employees
With this calculator, you can enter different income levels, ages, and family sizes to get an estimate of your eligibility for subsidies and how much you could spend on health insurance. http://kff.org/interactive/subsidycalculator/
1. How does it work? Employees secure health insurance and tax subsidies through the ACA Marketplace. You can sell the policy and earn commission on the full premium if you have a Health Insurance license and have completed the online federal certification. Then we show employers how to legally and tax-free reimburse their employees via their existing payroll service.
Individual Health Insurance Marketplaces These tax subsidies will only be available through www.Healthcare.gov, the new online website where employees can purchase individual health insurance plans. The marketplaces opened for enrollment on October 1, 2013, for coverage beginning January 1, 2014. Employees are only eligible for these subsidies if they are not offered qualified, affordable group health insurance through an employer.
2. How much does it cost? That is entirely up to the employer – he / she determine the cost. There is a small monthly administration fee that is typically financed 100% by tax savings. 3. What size agency / business do we work with? All sizes. There are no minimum or maximum employee participation requirements. AIANC’s STREET WISE
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November, 2013
Security, Accuracy & Reliability Focus on what you do best! Selling insurance. Let us focus on what we do best! Ensuring your financial peace of mind.
Give Rosemary A Lambert, CPA, PA a call. Whether you need daily financial guidance, or yearly tax planning services, our professional staff will work with you to customize a plan that aligns with the goals of your agency. Our firm understands the need for absolute confidentiality. We will ensure the security of your financial systems and provide you with accurate and reliable data. With more than 20 years in the business, Rosemary A Lambert has extensive experience in accounting for the insurance industry.
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More “News, Satire & Opinions for Independent Agents from Independent Agents” at www.AllianceInsuranceAgentsNC.com
Health Care Reform & Defined Contribution
Defined contribution health plans are an alternative to company-sponsored group health insurance plans. When talking about defined contribution, we are referring to a “pure” defined contribution model, where there is no group health insurance plan, and where employees can choose any individual health insurance policy.
Continued from page 2 Guaranteed-Issue Policies Starting in 2014, all individual and family health insurance policies are required to be guaranteed-issue, meaning employees cannot be denied or pay more because of a pre-existing condition. No longer will sick employees need to get affordable coverage through their employer.
“Pure” defined contribution health plans by themselves are not health insurance plans and therefore do not satisfy the employer mandate of minimum essential coverage. With a “pure” defined contribution health plan:
Defined Contribution: The Ideal Solution in 2014?
Your company gives each employee a fixed dollar allowance (a "defined contribution") that employees can spend on any qualified health insurance plan.
What is a defined contribution health plan? Rather than paying the costs to provide a specific group health insurance plan (a "defined benefit"), companies fix their costs on a monthly basis by establishing a defined contribution health plan. AIANC’s STREET WISE
Continued on page 6 Page 4
November, 2013
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Health Care Reform & Defined Contribution
Premium amounts shown in this tool are only examples, based on a limited set of sample ages and scenarios. They may not fully reflect your individual situation. Actual plan pricing can change based on your household size, income, ages, and tobacco use.
Continued from page 4 Employees purchase their own individual policy directly from a health insurance company of their choice, through an insurance broker, or through their state health insurance marketplace.
Because the monthly premiums shown don’t account for any lower costs you qualify for based on your household size and income, the final premium you pay may be lower, perhaps much lower, than the prices shown. The only way to find out what YOU will pay for a specific plan is to fill out a Marketplace application. Many people who apply for coverage will qualify for lower costs.
Employees use their defined contribution allowance to reimburse themselves tax-free for their individual health insurance costs, up to the amount of their allowance. You can preview Marketplace health plans and prices available in your area. But to find out the actual costs for your personal situation, you need to apply.
FACTORS THAT AFFECT PRICES SHOWN Where you live. Plans are priced partly based on where you live, so be sure to pick the right state and county first.
HOW TO VIEW HEALTH PLANS AND PRICES Start by providing some basic information to find plans and sample prices available in your area. Answer a few questions and you’ll see plans and premium estimates available in your area.
5 plan categories. Plans are presented in 5 categories: Bronze, Silver, Gold, Platinum, and Catastrophic. Learn more about these categories.
Important note: The monthly premiums shown DO NOT take into account your income and household details. AIANC’s STREET WISE
Continued on page 8
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More “News, Satire & Opinions for Independent Agents from Independent Agents” at www.AllianceInsuranceAgentsNC.com
Health Care Reform & Defined Contribution
Businesses of all sizes are trying to wrap their heads around health care reform (the Affordable Care Act or ACA) and what it means for their bottom line.
Continued from page 6 Age and family situations. The tool shows monthly premiums for different family situations and, for individual applicants, age. Your final rate will depend on your specific circumstances.
Businesses must start planning now to: Understand your health benefits options Navigate your ACA compliance obligations
PREMIUMS, DEDUCTIBLES, AND OTHER COSTS Prices shown are for monthly premiums only. Deductibles, copayments, and other out-of-pocket costs are not shown.
Implement a strategy for employee health benefits by 2014
If you want more information on a particular plan, you’ll see it after you apply in the Marketplace. In the meantime, you can call the insurance company offering the plan for more information.
The Affordable Care Act includes an “employer mandate” requiring employers with 50+ employees to either offer health benefits or else pay a penalty. This is also called the “play or pay” requirement. (Note: The employer mandate has been delayed from 2014 to 2015.)
What does this mean for your business?
Please remember: The monthly premiums shown don’t account for savings you may be eligible for based on your income and household details.
This comprehensive guide provides employers, owners, CEOs, human resource departments, insurance agents, and business consultants a road map to navigate these three options, and ultimately help you calculate your health benefits savings.
The only way to get a price for a specific policy that’s accurate for you is to fill out a Marketplace application. The monthly premiums shown are what someone who doesn’t qualify for any savings would pay. Find out if you may qualify for lower costs based on your income To see whether you may qualify for lower costs based on your household details and income, you can use the Kaiser Family Foundation calculator. AIANC’s STREET WISE
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More “News, Satire & Opinions for Independent Agents from Independent Agents” at www.AllianceInsuranceAgentsNC.com
Join AIANC today at www.AllianceInsuranceAgentsNC.com for only $250 per year and everyone in your office can start enjoying all the member benefits.
This top-level guide is written for Business Owners, CEOs and HR Professionals. The checklist helps you ensure compliance with key PPACA regulations, and learn about new cost-saving options for employee health benefits. The 13 regulations you need to know now, and in 2014 Concise descriptions of regulations, with links for in-depth resources How PPACA impacts employer-sponsored health insurance plans
Which health care reform regulations impact your business How the new health insurance marketplaces benefit employees What it means to "play," "pay," or to "play differently" How to design health benefits that save you money and help recruit and retain key employees How to calculate your health benefits savings Health care reform is changing the landscape of employee health benefits. By 2014, all businesses need to:
How PPACA impacts Defined Contribution Health Plans and FSAs
“How To” Booklets for AIANC Members
1) understand new compliance obligations, 2) analyze cost-saving opportunities, and 3) implement changes before January 1. Are you in compliance with current PPACA provisions, and ready for 2014?
AIANC’s STREET WISE
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Does ACA Change Full-Time Definition Other than Health? Q&A By Robin Thomas, Managing Editor In the past, employers had wide discretion regarding which employees they define as full-time or part-time, and benefits often were assigned according to these definitions. However, thanks to the ACA, many employers must change their definition of full-time employees, at least as far as health care insurance eligibility is concerned. Q: We have 60 employees and are covered by the Affordable Care Act. In our policies, we generally have defined as full-time employees those who worked 40 or more hours a week and those employees are entitled to a range of benefits, from health insurance to paid time off. Part-time employees are defined as those who work fewer than 40 hours, and they do not receive health insurance but they do receive a pro rata share of paid vacation and sick leave. Do we have to change our definition of full-time employees? A: Yes, but only for health insurance eligibility. Employers typically have a lot of flexibility in categorizing employees as either full-time or part-time since most federal and state laws generally do not define these terms. The 40-hour workweek has long been the benchmark for defining a full-time employee and was adopted by many employers as a result of the Fair Labor Standards Act (FLSA). The FLSA took effect in 1938 and requires employers to provide premium pay (overtime) to nonexempt employees who work more than 40 hours in a single workweek. Even with the creation of the FLSA overtime provision, no federal law specifically defined full-time employment until the Patient Protection and Affordable Care Act took effect in 2010 (commonly referred to as the Affordable Care Act or ACA). Prior to the ACA, employers often based their employee classifications on eligibility requirements for health insurance benefits, and many health care plans excluded part-time employees who worked less than 20 or 30 hours a week.
A health plan is considered to provide adequate coverage if the plan’s actuarial value (i.e., the share of the total allowed costs that the plan is expected to cover) is at least 60%. So, if you want to continue to define your part-time employees as those who work less than 40 hours and prorate their paid vacation and sick leave, you may continue to do so. But, you will have to provide health insurance to those part-time employees who regularly work 30 or more hours a week. Of course, because of the complexities of the ACA, you are advised to seek legal counsel to determine which employees should be offered health insurance. Interested in using an article from HR Matters E-Tips on your Web site or in a newsletter? Please contact Robin Thomas, Managing Editor of Personnel Policy Service, Inc., to request permission. You can contact her by email at editor@ppspublishers.com. Please note that the information in every issue of HR Matters E-Tips is the original, copyrighted work of Personnel Policy Service, Inc., and is protected under U.S. copyright laws. As such, you may not reprint or publish in any format any article or portion of article from HR Matters E-Tips without the express permission of Personnel Policy Service, Inc.
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However, the ACA has prompted many employers to apply a new definition of full-time employees, at least with regards to health insurance coverage. Under the ACA, employers with 50 or more employees must provide health insurance that meets minimum standards to their “full-time employees” or “full-time equivalent” employees by January 1, 2015, or face penalties, and the law defines full-time employees as those who work on average 30 or more hours a week. To avoid penalties, the health insurance coverage must be both “affordable” and “adequate” to covered employees. A health plan is affordable if the employee’s premium contribution toward the employer’s plan does not exceed 9.5% of household income. AIANC’s STREET WISE
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800-233-2036 or Mail@MPPOnline.com Absenteeism: What is Excessive and What is Protected? Q&A By Robin Thomas, Managing Editor Employees who miss work because of medical reasons often are protected by the FMLA and the ADA. But, not every medical absence is protected, and you can enforce your attendance policy and discipline employees for excessive absenteeism. Find out what you should consider before taking disciplinary action. Q: We provide several paid days off for use for sick leave. Most employees do not use up all of their sick days, but we have one employee who continually needs additional sick days off. These absences are very disruptive to our operations, but we are concerned that they may be protected under the FMLA or ADA. Can we discipline the employee for what we consider to be excessive absenteeism? What if she has a doctor's note for the absences? A: As a general rule, if an employee's absences are in excess of your stated policy (for example, the employee has taken more paid days off than provided by your policy), you can, and should, consider taking disciplinary action for the excessive absenteeism. But, before taking any action, you are right that you should first determine whether you have any obligations under the Family and Medical Leave Act (FMLA) or the Americans with Disabilities Act (ADA). AIANC’s STREET WISE
(Download free Attendance and Punctuality model policy including HR best practices and legal background.) Most employers define excessive absenteeism as absences that exceed what you allow by policy. Thus, authorized absences that are taken according to your absence and leave policies are not considered excessive. So, if the employee's absences are covered by your paid time off policies, you should allow them. Note, though, that simply because an employee has a doctor's note verifying a medical condition to justify an absence, you may still consider the absence excessive if the employee has used all of the days allowed by your policies and the underlying medical condition is not protected by the FMLA or ADA (see below). However, you may have to disregard absences required for reasons covered by the FMLA and the ADA when determining whether an absence is excessive and discipline is warranted. Both the FMLA and the ADA limit your right to discipline or discharge employees for absenteeism caused by a protected medical condition. Continued on page 13
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Absenteeism Continued from page 12 The FMLA requires covered employers (those with 50 or more employees and all public agencies and schools) to provide eligible employees with up to 12 weeks of unpaid, job-protected leave in any 12-month period, for the employee's own or a family member's serious health condition (and up to 26 weeks to care for a seriously ill or injured military family member injured in the line of duty). In addition, you cannot discriminate against employees who take FMLA leave. As a result, you cannot take an employee's FMLA-covered leave into account under "no-fault" attendance policies or consider the absences "excessive" under your absenteeism policy. So, if the employee's absences are caused by a serious health condition protected by the FMLA, you should disregard any absences related to the condition. Of course, you can require that the employee provide medical certification as allowed by the FMLA to substantiate the need for the time off under the FMLA. AIANC’s STREET WISE
Similarly, the ADA, which applies to employers with 15 or more employees, requires covered employers to provide reasonable accommodations to qualified individuals with disabilities unless doing so would impose an undue hardship. Reasonable accommodations may include part-time or modified work schedules, as well as additional unpaid leave. The ADA, in effect, requires that these absences be considered "excused" or, in the case of no-fault attendance policies, not counted for purposes of determining if discipline is appropriate. In addition, you may have to accommodate disabled employees by allowing them to take more unpaid leave than is provided by your leave policy unless this would impose an undue hardship on the operation of the organization. Thus, if your employee has a medical condition that meets the disability definition, then any absences related to it may be protected by the ADA. As with the FMLA, you can require medical certification of a disability to support the need for additional time off. Continued on page 14
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Then, if the absenteeism continues, you are in a strong position to take needed corrective action to discipline, or even terminate, the employee according to your normal policies.
Absenteeism Continued from page 13 But, if you determine that the absences are not protected by the FMLA or the ADA, the best way to manage this type of absenteeism is to focus on the individual problem employee and follow a progressive discipline program. For example, your supervisor should put the problem employee on notice, provide counseling about improving attendance, and document the warnings and steps taken.
AIANC’s STREET WISE
Please note that the information in every issue of HR Matters E-Tips is the original, copyrighted work of Personnel Policy Service, Inc., and is protected under U.S. copyright laws. As such, you may not reprint or publish in any format any article or portion of article from HR Matters E-Tips without the express permission of Personnel Policy Service, Inc.
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Autumn Word Search U S V R V F H O E L Y A S T S R F V
S K T T E S Q Q F A L T Z H T E A A
U C K H A B U S D E U A A A U D R C
T A A U G I M Y C N A L F N N L M H
ACORN APPLE BIRD MIGRATION BLOWING LEAVES BLUSTERY DAY CANNING CHESNUTS CHILLY COLD CROPS EQUINOX FALL FARMING
B T Q R N I R E S H L S S K Y E I I
T S N O E E N E V O O E T S R A N L
F Y X R T C H R W O V O D G O V G L
Y A O S O C R E E A N T L I K E R Y
I H U S T C E O E G Q A O V C S E E
M L W Z Y N A L W D N T C I I N B K
B I R D M I G R A T I O N N H U O R
FEAST FROST HALLOWEEN HARVEST HAYSTACK HICKORY NUTS LONGER NIGHTS NOVEMBER OCTOBER ORANGE LEAVES PIE PUMPKIN RAKE
Q G N I N N A C E K X P L G L U T U
C I B G I S Y A D R E T R O H S C T
W R P W Y E L L O W L E A V E S O C
Z I O N I K P M U P S E A S O N Q R
E L H A R V E S T W V W E L P P A O
B S E P T E M B E R O S F R O S T P
S E V A E L E G N A R O E K A R G S
RED LEAVES SCARECROW SCHOOL SEASON SEPTEMBER SHORTER DAYS SQUASH SWEET POTATOES THANKSGIVING TURKEY WINDY YELLOW LEAVES Solution elsewhere in this edition
Autumn Word Search Solution + S + R + + H + E L Y + S T S R F +
S K T + E S + Q F A L T + H T E A +
+ C + H A B U S D E U A A A U D R C
+ A A U G I M Y C N A L F N N L M H
+ T Q R N I R E S H L S S K Y E I I
(Over,Down,Direction) ACORN(10,7,NW) APPLE(16,17,N) BIRD MIGRATION(11,1,S) BLOWING LEAVES(17,1,SW) BLUSTERY DAY(11,1,SW) CANNING(12,8,N) CHESNUTS(8,6,SW) CHILLY(3,18,E) COLD(10,13,W) CROPS(14,18,E) EQUINOX(1,9,NE) FALL(4,13,NW)
+ S N O E E N E V O O E T S R A N L
+ Y X R T C H R W O V O D G O V G L
+ A + S O C R E E A N T L I K E R Y
+ H U + + C E O E G + A O V C S E E
+ L + + Y N A L W + N T C I I + B K
B I R D M I G R A T I O N N H + O R
+ G N I N N A C + + + P L G + + T U
FARMING(1,17,E) FEAST(2,9,SE) FROST(17,13,S) HALLOWEEN(2,14,NE) HARVEST(16,3,S) HAYSTACK(9,2,W) HICKORY NUTS(11,15,W) LONGER NIGHTS(12,13,NW) NOVEMBER(8,11,NW) OCTOBER(14,17,W) ORANGE LEAVES(18,12,N) PIE(14,3,NE) PUMPKIN(15,10,N)
+ I + + I S Y A D R E T R O H S C T
W + P W Y E L L O W L E A V E S O C
+ I O N I K P M U P S E A S O N + R
E L H A R V E S T + + W E L P P A O
B S E P T E M B E R + S F R O S T P
S E V A E L E G N A R O E K A R + S
RAKE(18,16,N) RED LEAVES(1,16,E) SCARECROW(2,1,SE) SCHOOL(3,8,SE) SEASON(15,11,S) SEPTEMBER(17,2,S) SHORTER DAYS(13,16,N) SQUASH(6,2,SW) SWEET POTATOES(17,12,W) THANKSGIVING(1,14,E) TURKEY(13,18,W) WINDY(14,1,SW) YELLOW LEAVES(14,5,S)
More “News, Satire & Opinions for Independent Agents from Independent Agents” at www.AllianceInsuranceAgentsNC.com
How to Hire Top Sales Reps by John Chapin With all the advances in every area of life, you’d think hiring the right salespeople would be an exact science at this point. It isn’t. Hiring the right people is a combination of science and philosophy and you have to utilize both effectively to hire someone who ultimately “makes it.” Here are the aspects to “employ” in order to employ the right salespeople. Keys to Hiring Top Sales Reps Hiring tip #1: Only hire employed winners. An unemployed salesperson out looking for a job is a major red flag. Unless someone’s company just blew up, or there is some other crazy extenuating circumstance, a salesperson looking for a job should, at the very least, still be employed. That said, an employed salesperson out looking for a job is a yellow flag. People do switch jobs for a variety of perfectly legitimate reasons related to family or other solid personal reasons, just make sure the reason is a good one and they can back up the stellar sales skills they claim to have. In reality, most salespeople are looking for a job because they can’t sell and they either got let go, or are about to. Don’t hire someone else’s problem without A LOT of due diligence. Hiring tip #2: Only hire within your industry if you recruited the person. If you find a stellar salesperson you want working for you instead of the competition, great, otherwise avoid your industry like the plague. Someone within the same industry looking for a job elsewhere does so because they can’t sell. Again, unless there is an extenuating circumstance with the company or product, the problem is the salesperson.
AIANC’s STREET WISE
Hiring tip #3: Always be on the lookout for good salespeople. Even if you are not hiring right now, build your list of candidates for when you are. That great salesperson who just sold you your car, boat, or home alarm system is a good prospect to come work for you now or at some point in the future. It’s simple, winners win. A winning salesperson in another industry can learn to sell just as effectively in your industry. Also, truly great salespeople can make the transition from products to services and from phone sales to in-person sales and vice versa. Hiring tip #4: Hire self-esteem, self-confidence, and the right attitude. Lacking any of these three is the number one reason salespeople fail. A lack of activity, blaming the economy and other outside circumstances, and ultimately not doing what needs to be done every day whether you feel like it or not, all come down to an issue with one or all of these three. Also, you want someone with a strong work ethic who is seeking a career instead of a job. Hiring tip #5: Have a hiring process. Have several people put their eyes on a potential hire. Meet all their decision makers such as spouses. Do all your testing, check all paperwork, cross all your T’s and dot all your I’s. Don’t take shortcuts, have a process and stick to it like a pilot doing preflight.
Continued on page 18
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How to Hire Top Sales Reps Continued from page 17 Hiring tip #6: Shake up the testing process. Telling an applicant you are about to hire that they did not get the job, bringing them to an event with an open bar, playing golf with a candidate, or visiting them at their home, are some great ways to find out what people are really like. While you should absolutely use personality tests, in-office interviews, and other standard, accepted hiring practices as your foundation, realize that most tests can be beaten, and most people can put their best mask on temporarily. To find out what people are really like, move them out of the typical hiring environment. Hiring tip #7: Be skeptical of references, especially personal references. Anyone can find a brother-in-law, friend they went to college with, or a third cousin twice removed to say the candidate is the best thing since the wheel. If they are that good, the wheel never would have been invented. Hiring tip #8: Start not with what your company can do for them… Be wary of people who lead by asking what the base or draw is and what benefits they will get. Hiring tip #9: Candidates should be transparent and forthcoming. Yes, applicants should be willing to give you access to all their social media information, and all their other information for that matter. That said, you should be able to find enough information on applicants without having to get social media passwords. It’s just another good test to see if the applicant may have something to hide. Also, someone with a very small or no online footprint is an orange flag. Investigate further.
Because the life of your business does depend upon it. In addition to hiring standards, you need performance standards and time lines that are agreed upon. Accountability is extremely important. Hiring tip #11: Hire slowly and fire quickly. Do the work and don’t cut corners. A lot of work on the front end will avoid a lot of pain once you hire the person and they don’t work out. Also, once you realize you have a duck instead of a swan, and they are not living up to the standards agreed upon under tip #10, cut the cord fast. Hiring tip #12: Provide the right environment. It doesn’t help to hire the right people if you bring them into an environment where chronic underperformers, negative people, a lack of support, and other similar cancers exist. For John Chapin’s free newsletter, or if you would like him to speak at your next event, go to: www.completeselling.com John has over 26 years of sales experience as a number one sales rep and is the author of the 2010 sales book of the year: Sales Encyclopedia. For permission to reprint, e-mail: johnchapin@completeselling.com. John Chapin Complete Selling, Inc. Helping you find and get all the business you want Cell: 508-243-7359 johnchapin@completeselling.com www.completeselling.com LINKEDIN: once logged in find me under: johnchapin1 FACEBOOK: http://www.facebook.com/johnjchapin TWITTER: http://twitter.com/johnjchapin # 1 Sales Rep in 3 industries, Author of the gold-medal winning SALES ENCYCLOPEDIA - The most comprehensive "how-to" guide on selling.
Hiring tip #10: Have standards and stick to them as if your life depends upon it…
AIANC’s STREET WISE
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Many of these policyholders historically have paid subsidized rates that do not reflect the property’s true risk. Nationwide, about 20 percent of all NFIP policies are subsidized. To help you discuss these changes with your clients, FEMA developed a suite of resources, including the:
Biggert-Waters Flood Insurance Reform Act of 2012: Resources to communicate changes to the NFIP Flood insurance rates for some policyholders increased starting October 1 as the Federal Emergency Management Agency (FEMA) continued to implement the Biggert-Waters Flood Insurance Reform Act of 2012 (BW-12). The first phase of rate increases (Section 100205) affects many policyholders who own buildings constructed before their community adopted its first Flood Insurance Rate Map (FIRM). You can help your clients understand the changes and prepare for their new bill.
What to Know and Say Factsheet. These talking points can help guide your conversations about BW12. Quick Reference Guide. Keep this guide on hand as an outline of important dates and changes. BW-12 Brochure. Share with your clients so that they always have the necessary information on hand when they make decisions about their policies. Additionally, FEMA partnered with the Insurance Information Institute to create six videos that provide details about the legislation and give advice on how your clients can prepare. Each video was developed around a specific topic.
One of the most important things to know is that not everyone will see immediate rate increases as a result of BW12. Only one group of policyholders—those in high-risk areas paying pre-FIRM subsidized rates—might be affected by the changes taking place this year.
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Overview What is a Subsidized Rate Moving Away From Subsidized Rates Addressing Flood Risk Elevation Rating Reducing Insurance Costs Visit FEMA.gov/BW12 for the most up-to-date information.
November, 2013
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Wayne Hooper Reports: “Do You Speak Insur-ish?” By Wayne Hooper Recently, I began volunteering as a docent in a museum in Ellijay, GA. Learning about the history in North Georgia stirred my passion for the history about how and why we came here. One of the asides of a history study is the terminology and sayings that define the "American" language.
phrases into the language we use in day to day conversation without realizing their origins. Many words we invented have no other alternative in other languages, such as "to Google" something. The insurance business has its own sub-language which evolved from terms used in Latin, Old English and the Maritime industry. Most of these terms are meaningless to your customers. In the 1970's "Easy to Read" legislation was passed requiring the policy text to be understandable to a person with a 8th grade education. It also defined how the punctuation was to be used, as a misplaced comma can add or subtract coverage based on the wording. The simplified language expanded coverage so that many more situations were covered than previously. The industry began adding back exclusions to close the holes and restricting the coverage over the years.
I think the “American" language is a distinct language because it incorporates Scot, Irish, English, Jewish, Polish, Spanish, Chinese, Internet , African words and AIANC’s STREET WISE Page 20
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Wayne Hooper Reports: Continued from page 20 A typical P&C policy now contains more exclusion pages than the coverage, making it difficult to follow as coverage on the first page is modified or excluded on page 6. It looks like it is time to rewrite the policies again. A successful agent quickly learns how to translate "insur-ish" into every day terms so their customers can make an informed decision. The challenge for the future as we move through the "age of the internet" is to keep up with the terms and software used by our customers. I stumbled on this problem several times with young managers fresh out of graduate school, assuming the sales staff knew all of the terminology and use of Lotus, PowerPoint, Twitter, Texting, EXCEL, AVENUES and Word which they used in school. A friend recently sent me a copy of the 906 pages “AFFORDABLE CARE LAW" for my reading entertainment. Unfortunately it is written in legal terminology modifying existing laws which makes it almost impossible to follow without the prior laws laid out beside it. A small example paragraph from page 340 out of 906 pages of the AFFORDABLE HEALTH CARE LAW (e) AUTHORITY TO REQUIRE SPECIAL NEEDS PLANS BE NCQA APPROVED.—Section 1859(f) of the Social Security Act (42 U.S.C. 1395w–28(f)), as amended by subsections (a) and (c), is amended—
and doctors, but mostly it delegates the standards (Rules, Guidelines, Reports, Payment amounts) to the "Secretary of Health and Human Services" to develop them. In short, we are going to be learning how this plays out for the next few years. Eddie Emmett has developed classes to take some of the mystery out of it. As of today only three (3) Navigators are approved in Georgia per National Public Radio. Eddie is one of the few to pass the test and be approved but the opportunity is there for any agent to learn that extra skill with a little study. Editor’s note: It’s one thing to speak in terms understood by the client. It’s another when we fall into the trap of using our own “Insurance-Eze” slang. Since Wayne saw fit to include my name I thought I’d relay a true story about my brother-in-law and agency owner Randy James’ use of Insurance-eze. Over 20 years ago Randy was our agent in one of the Esquire Insurance Agencies. It was in the day before word processors so Randy hand-wrote a memo to one of our auto insurance customers. As it turns out, the policyholder’s Motor Vehicle Record showed his Driver’s License was suspended so the insurance company was going to cancel the policy. Here’s what Randy wrote: “Your ins co ran an MVR and found that your lic has been susp’d so your pol is getting cxl’d.” After reading the memo I turned to Randy and said “Your Lic has been Susp’d?”
(1) in paragraph (2), by adding at the end the following new subparagraph:
Wayne Hooper Reports …
‘‘(C) If applicable, the plan meets the requirement described in paragraph (7).’’;
Wayne Hooper
(2) in paragraph (3), by adding at the end the following new subparagraph: ‘‘(E) If applicable, the plan meets the requirement described in paragraph (7).’’; (3) in paragraph (4), by adding at the end the following new subparagraph: ‘‘(C) If applicable, the plan meets the requirement described in paragraph (7).’’; and (4) by adding at the end the following new paragraph Did you follow those changes? Or do you know more than when you first started reading it? Other areas of the law are written in plain English defining what can be done and not done by the hospitals
AIANC’s STREET WISE
Wayne@FYIEXPRESS.com
Cell # 678-296-6345
Wayne Hooper is a retired Insurance executive and agent with 43 years’ experience in the P&C industry. A Georgia native, born in Tifton, Ga., Wayne graduated from Georgia State University with a degree in Psychology. He was commissioned into the Army on graduation and served in Germany. Wayne has been an underwriter, supervisor, manager, Product Manager, Reinsurance coordinator, agent, and Sales Manager with various carriers and MGA’s in his career. He recently retired from Kemper Specialty Insurance Co. after 13.5 years of service to join the staff of the FYI Express as a contributing editor. Wayne enjoys good humor, good food, good stories, history, sailing, antique cars, and hiking in the North Georgia Mountains. Not always in that order, depending on the weather. Page 21
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An anonymous caller reported that the vehicle was being stored under a tarp behind Bullock's girlfriend's residence and investigators recovered the vehicle. Bullock was arrested on Nov. 6 and was placed under a $2,000 secured bond. Waynesville Bail Bondsman Held on Alleged Embezzlement Charges RALEIGH -- Insurance Commissioner Wayne Goodwin today announced the arrest Juan Camacho, 45, of 275 Hyatt St., Waynesville; he was charged with 12 counts each of embezzlement and obtaining property by false pretense. Department of Insurance criminal investigators allege that between 2012 and 2013, while working as a licensed bail bondsman, Camacho fraudulently obtained money from bonds he wrote without the knowledge of his employer and converted those funds for his own personal use. The investigation was handled jointly by the North Carolina Department of Insurance Criminal Investigations Division, Waynesville Police Department and the Haywood County District Attorney's Office. Camacho was arrested on Nov. 5 in Haywood County and was placed under a $275,000 secured bond. NCDOI Uncovers Alleged Building Code Scam in Wilson County The Department of Insurance employs 20 sworn state law enforcement officers dedicated to investigating and prosecuting claims of insurance and bail bonding fraud. Since Insurance Commissioner Wayne Goodwin took office in 2009, criminal investigators have made more than 800 arrests, resulting in 430 criminal convictions thus far. These efforts have delivered more than $55 million in restitution and recoveries for victims.
Seeks public assistance in locating additional suspects and possible victims
An estimated 10 cents of every dollar paid in premiums goes toward the payment of fraudulent claims. To report suspected fraud, contact the Department of Insurance Criminal Investigations Division at 919-8076840. Callers may remain anonymous. Information is also available at www.ncdoi.com.
Department of Insurance criminal investigators allege that the group defrauded an individual of more than $7,400 between May 23, 2013, and Oct. 10, 2013. Six of the nine are accused of unlawfully presenting themselves as City of Wilson code enforcement officials and misleading the alleged victim that his home was in violation of state building codes and required his payment to be brought into compliance. He wrote several personal checks, which were cashed by the defendants.
Knightdale Man Accused of Defrauding Insurance Company with Stolen Vehicle Claim RALEIGH -- Insurance Commissioner Wayne Goodwin today announced the arrest of William Henry Bullock, 64, of 417 Three Sisters Road, Knightdale; he was charged with one count of obtaining property by false pretense. Department of Insurance criminal investigators allege that Bullock falsely reported his Ford Mustang stolen, filed a fraudulent insurance claim with GEICO Insurance Company and accepted approximately $4,600 to settle the claim.
AIANC’s STREET WISE
RALEIGH -- Insurance Commissioner Wayne Goodwin today announced the arrests of seven people for a scheme involving the exploitation of an elder adult in Wilson County. The Department of Insurance requests assistance from the public in locating additional suspects in association with this case.
NCDOI investigators worked with banking officials, the North Carolina Office of State Fire Marshal, the City of Wilson and the Wilson County Sheriff's Office to identity the defendants and verify that none of them were licensed code enforcement officials. Continued on page 23
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Douglas Michael Reason, 28, of 6056 Webbs Lake Road, Elm City, is wanted for one count of obtaining property by false pretense. Jeffrey Lane Tyler, 27, of 1029 Compass Creek Drive, Rocky Mount, is wanted for one count of obtaining property by false pretense.
The following individuals have been arrested and charged: Heather Roseanne Adcock, 18, of 2953 Abner Drive, Rocky Mount, was charged with one count of obtaining property by false pretense. She was arrested on Oct. 29. Christine Hope Howlett Ezzell, 36, of 449 Tobacco Road Rocky Mount, was charged with four counts of obtaining property by false pretense, and one count each of exploitation of an elder adult and unlawfully acting as a code enforcement official. She was arrested on Oct. 25. Madison Earl Howlett, 28, of 449 Tobacco Road, Rocky Mount, was charged with five counts of obtaining property by false pretense, and one count each of exploitation of an elder adult and unlawfully acting as a code enforcement official. He was arrested on Oct. 30. Jonathan Taylor "JT" O'Neal, 26, of 3633 Highway 301N, Wilson, was charged with four counts of obtaining property by false pretense, and one count each of exploitation of an elder adult and unlawfully acting as a code enforcement official. He was arrested on Oct. 24. Michael Sidney O'Neal, 24, of 3633 Highway 301, Wilson, was charged with one count of obtaining property by false pretense. He was arrested on Oct. 28. Nelson Skinner II, 38, of 50 Church St., Black Creek, was charged with one count of obtaining property by false pretense. He was arrested on Oct. 28. Andrew Jason Ward, 32, of 3935 Taylor Store Road, Nashville, was charged with five counts of obtaining property by false pretense, and one count each of exploitation of an elder adult and unlawfully acting as a code enforcement official. He was arrested on Oct. 30.
If you have information on their whereabouts, or if you believe someone you know may be a victim, you are encouraged to contact the North Carolina Department of Insurance Criminal Investigations Division at 919-807-6840. Callers may remain anonymous. Couple Arrested on Embezzlement and Workers' Comp Fraud Charges RALEIGH -- Insurance Commissioner Wayne Goodwin today announced the arrests of Christopher Ingalls, 39, and Samantha Ingalls, 34, of 115 Harmony St., Winston-Salem; both were charged with two counts of embezzlement and one count each of insurance fraud, obtaining property by false pretense and conspiracy to obtain property by false pretense. Department of Insurance criminal investigators allege that the couple, while working for the same company in Wake County, conspired to defraud The Hartford Insurance Company of more than $14,000 worth of workers' compensation benefits. Investigators allege that between March 10, 2012, and Aug. 10, 2012, the couple submitted inflated salary reports for Christopher Ingalls and collected workers' compensation benefits for him while he continued drawing a regular salary. Due to evidence uncovered during the investigation of the workers' compensation case, investigators also accuse the Ingalls of embezzling nearly $33,000 from their place of employment by falsifying billable hour reports, making personal purchases on company credit cards and writing themselves fraudulent reimbursement checks. The couple was arrested on Oct. 28, processed at the Wake County jail, and each was placed under a $150,000 unsecured bond.
Department of Insurance criminal investigators are requesting the public's assistance in locating these additional suspects: Jon Chase Daniels, 28, of 119 S. Harris St., Rocky Mount, is wanted for five counts of obtaining property by false pretense, and one count each of exploitation of an elder adult and unlawfully acting as a code enforcement official. Bobbilee Faith Joyner, 26, of 3941 Whitley Circle, Rocky Mount, is wanted for one count each of obtaining property by false pretense, exploitation of an elder adult and unlawfully acting as a code enforcement official. AIANC’s STREET WISE Page 23
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Department of Insurance criminal investigators allege that Ruggieri attempted to fraudulently obtain $10,000 from Universal North American Insurance Company by falsely claiming that her engagement ring and wedding band set was stolen from her residence in a burglary. When the insurance company asked her about the claim, Ruggieri changed her story and withdrew it.
Investigators Make Arrests in Wake County Insurance Scheme RALEIGH -- Insurance Commissioner Wayne Goodwin today announced the arrest of four people in an alleged embezzlement scheme involving insurance funds. Anthony Quentin Barlow, 40, of 7373 Sandy Creek Drive, Raleigh, was charged with one count each of embezzlement and conspiracy to obtain property by false pretense. He was arrested on Oct. 24 and placed under a $30,000 unsecured bond. Tony Maurice Pittman, 40, of 8037 Bright Oak Trail, was charged with one count each of obtaining property by false pretense and conspiracy to obtain property by false pretense. He was arrested on Oct. 24 and placed under a $10,000 unsecured bond. Sabrina Michelle Smith, 37, of 5300 Talison Court, Raleigh was charged with one count each of obtaining property by false pretense and conspiracy to obtain property by false pretense. She was arrested on Oct. 24 and placed under a $30,000 unsecured bond. Rodney Smith, 39, of 5300 Talison Court, Raleigh was charged with one count each of obtaining property by false pretense and conspiracy to obtain property by false pretense. He was arrested on Oct. 24 and placed under a $30,000 unsecured bond. Department of Insurance investigators allege that Barlow, while working as a claims associate at Nationwide Insurance, fraudulently used company claims funds to write checks to Sabrina Smith, Rodney Smith and Tony Pittman, who are each accused of receiving and cashing the checks. After reviewing checks written and cashed between June 6, 2010, and Dec. 12, 2012, investigators allege that the defendants embezzled and split approximately $69,000 from the scheme. Wedding Ring Set Leads to Arrest for Alleged Insurance Fraud RALEIGH -- Insurance Commissioner Wayne Goodwin today announced the arrest of Tina Marie Ruggieri, 38, of 1804 Hoosac Drive, Waxhaw; she was charged with two counts of insurance fraud and one count each of obtaining property by false pretense and attempting to obtain property by false pretense. AIANC’s STREET WISE
Ruggieri is accused of fraudulently obtaining $11,529 from Nationwide Mutual Fire Insurance Company after making a second false claim in June 2013 that the same engagement ring and wedding band set had mysteriously disappeared from her home. Ruggieri was arrested with the assistance of the Union County Sheriff's Office on Oct. 25 and placed under a $5,000 secured bond. She is expected to appear at the Union County District Court on Nov. 21. Henderson Man Accused of Falsifying Insurance Documentation RALEIGH -- Insurance Commissioner Wayne Goodwin today announced the arrest of Zuri Girad Sneed, 22, of 841 State St., Henderson; he was charged with one count of attempting to obtain property by false pretense. Department of Insurance criminal investigators allege that Sneed attempted to defraud GEICO Insurance Company of $3,700 by submitting fraudulent documentation in support of an insurance claim for damage to his motorcycle as a result of an Aug. 19, 2013, accident. Sneed was arrested in Vance County on Oct. 23 and placed under a $5,000 unsecured bond.
Protect Yourself from Fraud Related to Health Care Reform RALEIGH -- Insurance Commissioner Wayne Goodwin warns North Carolinians to beware of scam artists who may try to take advantage of the confusion surrounding federal health care reform. "Scammers may pose as insurance agents or representatives of the federal government in an attempt to sell fraudulent policies or collect your personal information," Goodwin said. "The best way to protect yourself is to be informed and recognize red flags." Continued on page 25
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Health Insurance Marketplace
If you have questions about health insurance, call NCDOI's Health Insurance Smart NC program at 877885-0231.
New Health Insurance Marketplaces, or exchanges, opened on Oct. 1. These online portals ask consumers to enter information about themselves and select the level of coverage they desire to receive a list of plans they can purchase. North Carolina's Health Insurance Marketplace is run by the federal government and can be accessed at www.healthcare.gov. Beware of bogus websites that give the appearance of being part of the new Marketplace. You should also be suspicious of anyone who charges a fee to inform you about the Marketplace or in connection with enrollment.
If you have questions about Medicare, call SHIIP, the Seniors' Health Insurance Information Program, at 800443-9354. To find local assistance with enrollment through the federal Health Insurance Marketplace/exchange, call 800-318-2596 or visitwww.healthcare.gov.
New "Obamacare" Insurance or Medicare Cards Another common ploy involves unsolicited calls from scammers who claim to have your new "Obamacare" insurance card—they just need to get some information before they can send it to you. The caller then asks for credit card numbers, bank account information or your Social Security number. A variation of this trick specifically targets seniors on Medicare; the caller claims that for them to get their new Medicare card and continue receiving their benefits, they must verify their bank account and routing numbers. Some callers ask for their Medicare numbers, which are identical to Social Security numbers. Medicare beneficiaries are not required to obtain a new insurance or Medicare card under the Affordable Care Act. Also, anyone who is a legitimate representative of the federal government will already have your personal and financial information and should not ask you to provide it.
Has your agency started to get inquiries about Obamacare? Alliance of Insurance Agents of NC has figured out a way for your P&C only agency to benefit from the growing confusion.
Don't Be Misled
Eddie K. Emmett of Alliance of Insurance Agents of NC created a 19 page PDF with embedded hyperlinks.
Don't Be Misled Here are some other important red flags to watch out for:
The PDF will show you:
The salesperson says the premium offer is only good for a limited time. Enrollment in the exchanges will be open from Oct. 1 to March 31, and rates for plans in the exchanges will have been approved for the entire enrollment period. Be skeptical of someone who is trying to pressure you into buying a policy because the rate is only good for a short time. Remember, if the offer sounds too good to be true, it probably is.
How Health Insurance Agents & Brokers can easily comply with the Federal training and certification The necessary steps needed for Persons wishing to become Navigators or Certified Application Counselors
You receive an unsolicited phone call, email or visit from someone trying to sell insurance. The federal government and state insurance departments will not be contacting individual consumers to sell insurance. Do not give any sensitive information to anyone who calls or comes to your home without your permission, even if they claim to be with the federal government, your state insurance department or a navigator for the exchange.
AIANC’s STREET WISE
How P&C only Agencies can become “Obamacare Guides” and satisfy the P&C Insurance needs of the folks lining up out the door! AIANC Members in good standing may download it at www.AllianceInsuranceAgentsNC.com
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