A MONTHLY PUBLICATION OF THE INDEPENDENT INSURANCE AGENTS & BROKERS OF LOUISIANA
LOUISIANAAGENT MARCH 2022
By Jeff Albright IIABL CEO Page 5
Save Time in Your Agency by Using Outlook's "Quick Parts"
Does Your E&O Insurer Have Your Back?
Let's Get 'Together Again' at the Beach!
By Ben Albright VP of Strategic Initiatives
By Jeff Albright IIABL CEO
By Kathleen O'Regan Director of Communications & Events
Page 12
Page 10
Page 18
PAGE 2
IIABL STAFF JEFF ALBRIGHT Chief Executive Officer jalbright@iiabl.com (225) 236-1366
BENJAMIN ALBRIGHT Vice-President of Strategic Initiatives balbright@iiabl.com (225) 236-1357
KATHLEEN O'REGAN Director of Communications & Events koregan@iiabl.com (225) 236-1360
KAREN KUYLEN Director of Accounting & Finance kkuylen@iiabl.com (225) 236-1353
RHONDA MARTINEZ Director of Insurance Programs rmartinez@iiabl.com (225) 236-1352
JAMIE NEWCHURCH Director of Insurance Programs jnewchurch@iiabl.com (225) 236-1350
LISA YOUNG-CROOKS Director of Member Relations lyoung@iiabl.com (225) 236-1351
LOUISIANAAGENT
PAGE 4
LOUISIANAAGENT
CONTENTS TABLE OF CONTENTS & FEATURED STORIES
02 IIABL STAFF At your service!
14 CATALYIT CORNER Experiment with Microsoft Sway
18 LET'S GET 'TOGETHER AGAIN' By: Kathleen O'Regan, Director of Communications & Events
21 SOUTH LA EXPOSURES TO FLOODING By Gregg Porter Sr. Flood Territory Manager, Selective Insurance
24 EARN MORE WITH IMS Independent Market Solutions
26 EMPLOYEE OR INDEPENDENT CONTRACTOR? By Chris Boggs
05 THE GOOD, BAD & UGLY
30 DEBATING AMBIGUITIES IN INSURANCE CONTRACTS By Chris Boggs
35 CLOSE THE GAP BETWEEN STRATEGIC PLANNING & EXECUTION
By: Drew Yancy, Ph.D., Partner, InCite Performance Group
37 MOVE FROM TACTICAL TO
STRATEGIC COMMUNICATIONS By Sally Ann O'Dowd
39 AN AGENT CALL TO ACTION: SAVE TIME IN YOUR AGENCY
12
16
DOES YOUR E&O INSURER HAVE YOUR BACK?
UNDERINSURNACE
By Bill Wilson, InsuranceCommentary.com
43 VIRTUAL SELLING = SUCCESS By: Annemarie McPherson
48 THE PROBLEM WITH SILENCE By: Carey Wallace, Agency Focus
50 ACT 'MFA' SURVEY ACT Survey Results
18153 E. Petroleum Drive Baton Rouge, LA 70809 Ph: (225) 819-8007
www.iiabl.com
52 IIABL EDUCATION UPDATE 54 ADVERTISER INDEX 55 INDUSTRY PARTNERS 56 IIABL BOARD OF DIRECTORS
The Good, Bad & Ugly By: Jeff Albright Two historic hurricane seasons with four hurricanes and a tropical storm has left Louisiana battered and bruised. The Louisiana Legislature reflects the frustration and anger of citizens who feel that insurers have been too slow, assigned too many adjusters, and offered too little in their initial adjustment.
takes 450,000 man days to adjust the claims…just from Hurricane Ida. It is an overwhelming task.
The insurance industry is clearly under attack in the legislature. IIABL has close to 50 bills on our high priority “save the industry” list. Never before have we faced such difficult legislation.
The Louisiana property market is already as bad as anyone has ever seen it. We desperately need more insurers writing property insurance in our state. Punitive legislation will only discourage insurers from bringing new capacity, availability, competition, and over time affordability of insurance back to Louisiana.
There is no doubt that insurance companies need to find ways to manage catastrophe claims more effectively. However, people do not understand the magnitude of these catastrophes.
IIABL is urging legislators to pass meaningful insurance reforms that will improve the catastrophe claims settlement response, without creating a property insurance market crisis.
The good news is that IIABL and some legislative leaders, who understand the need for balancing Hurricane Ida alone had 450,000 claims. If each “consumer protections” with a reasonable claim takes 10 hours, that is 4,500,000 hours of insurance market environment, have a number of claims adjustment. If adjusters work 10 hours a meaningful insurance reforms filed in the day, that means they manage one claim a day and it legislative session.
PAGE 7
LOUISIANAAGENT
LEGISLATIVESESSION
Continued from page 5
The Good Bill #
Author
Explanation
HB 280 HB 521
Huval, Mike(R) Talbot, Kirk(R) Huval, Mike(R)
Requires insurance companies & brokers to have written catastrophe response plans which specifically address how they will adequately manage catastrophe claims. IIABL sponsored bill.
SB 105
Fesi, Sr., Mike(R)
Requires all insurers to provide notice of any increase of premium or deductibles and notice of any decrease in coverage limits at least 30-days before expiration.
SB 117 SB 122 HB 870
Luneau, Jay(D) Talbot, Kirk(R) LaCombe, Jeremy(D)
Requires insurers to provide auto liability coverage for the temporary use of a motor vehicle not owned by the insured.
SB 119 SB 163 SB 232
Talbot, Kirk(R) Talbot, Kirk(R) Stine, Jeremy(R)
Requires insurers to provide policyholders with a catastrophe claim consumer guide at the time of loss and explains what they need to know about the settlement of their claim. IIABL sponsored bill.
PAGE 8
LOUISIANAAGENT
LEGISLATIVESESSION
Continued from page 7
The Good, Continued Bill #
Author
Explanation
SB 162
Talbot, Kirk(R)
Prohibits insurers from cancelling or nonrenewing storm damaged properties until after repairs are made. IIABL sponsored bill.
SB 198
Talbot, Kirk(R)
Requires insurers to provide claim information and streamlined communications procedures to reduce the “churn” of claims adjusters.
SB 212
Stine, Jeremy(R)
Establishes the Hurricane Mediation Program to provide policyholders with process to settle insurance claim disputes.
SB 264
Bouie, Joseph(D)
Increases the minimum capital and surplus requirements necessary to start a domestic insurer to increase the financial stability of start-up insurance companies.
The bad news is that there are frustrated legislators who want to show their constituents back home that they are protecting their interests in the settlement of hurricane claims. Legislators do not always understand the magnitude of claim settlements in a large storm and seldom understand the details and nuances how legislation will impact insurers in the real world. IIABL is working hard to educate legislators on the practical application of their legislative proposals in an effort to implement positive insurance reforms without major “unintended consequences” that end up hurting Louisiana policyholders and our IIABL member agents.
NOMADIC
|
24
PAGE 9
LOUISIANAAGENT
LEGISLATIVESESSION
Continued from page 8
The Bad & Ugly Bill #
Author
Explanation
HB 83 SB 134
Schlegel, Laurie (R) Talbot, Kirk(R)
Statutorily expands the trigger for civil authority additional living expense coverage under homeowner's insurance policies that require a civil authority to prohibit use of the dwelling in order to pay loss of use benefits.
HB 220
Green, Jr., Kyle(D)
Allows for the disclosure of automobile liability insurance coverage limits to a third party claimant / plaintiff.
HB 268
Magee, Tanner(R)
Subjects insurers to bad faith penalties if they do not pay hurricane claims within 60-days of initial claim inspection.
HB 316 SB 331
Willard, Matthew(D) Stine, Jeremy(R)
Requires insurers to transmit all claim documents to insureds with 30-days during times of a gubernatorially declared disaster.
PAGE 10
LOUISIANAAGENT
LEGISLATIVESESSION
Continued from page 9
The Bad & Ugly, Continued Bill #
Author
Explanation
HB 317 SB 150
Willard, Matthew(D) Luneau, Jay(D)
Requires agents to obtain a signed policy document for all hurricane, named storm, and wind and hail deductibles, similar to UM selection forms on auto policies.
HB 351
Jordan, Edmond(D)
Prohibits the use insurance “credit” scores, employment, and other rating factors in automobile insurance underwriting.
HB 558
Willard, Matthew(D)
Subjects insurers to bad faith penalties if they do not begin claims settlement within 90-days of initial inspection.
SB 208
Stine, Jeremy(R)
Requires an insurer pay increased bad faith penalties of 100% or 150% for not timely paying a property insurance claim that is related to a catastrophic event.
PAGE 11
LOUISIANAAGENT
LEGISLATIVESESSION
Continued from page 10
The Bad & Ugly, Continued Bill #
Author
Explanation
SB 209
Stine, Jeremy(R)
Increases the maximum fine the commissioner of insurance can order to persons engaging in an unfair method of competition or an unfair or deceptive act or practice from $250,000 to $500,000.
SB 231
Henry, Cameron(R)
Statutorily defines additional living expense coverage on homeowner’s policies as “uninhabitable” if there is no electricity, water, sewer, or gas.
SB 253
Barrow, Regina(D)
Provides an unfair trade practice if an insurer takes advantage of an insured who is a senior or a special needs individual during a disaster or declared emergency.
This is a legislative session for the ages. It is a dangerous time for everyone in the insurance industry. We all need to play our part in educating legislators and advocating for positive reforms. We need your help. Get involved. Please respond to our grassroots alerts!
NOMADIC
|
24
Save Time in Your Agency by Using Outlook's "Quick Parts" for Your Emails Benjamin Albright VP Strategic Initiatives
In an insurance agency, it’s important to have standardized workflows. When you send out a quote, for example, there are certain things that you have to make sure you say: Every. Single. Time. A standardized proposal format gets you most of the way there, including language like “higher limits available on request” and “notify us if you purchase additional property” to cover your bases. However, not everything fits conveniently in the formal proposal, so most agents end up sending formulaic emails on a regular basis.You end up typing and retyping the same email to 100 different clients over the course of a year. This is where Outlook’s Quick Parts feature can help you. Quick Parts is built into Microsoft Outlook, so there’s no additional charge if you’re already using Outlook as your email client. It gives you the option to create template language to insert in future emails.That way, if you have one of those emails that you find yourself typing over and over and over again, you can create the template and
LOUISIANAAGENT
save yourself some time. Best of all: it’s quick and easy to use. Next time you finish typing a form email that you know you’ll reuse, take a couple of seconds to give Quick Parts a try. All you have to do is go to the “insert” menu at the top of Outlook. Quick Parts is one of the options next to insert text box and insert word art. Start by (in the body of the email) highlighting the text that you want to save for future emails. Then click on Quick Parts and select “Save selection to Quick Parts Gallery”. A box will come up asking you to pick a name and description for the template – just pick something that you will remember and then click ok. And you’re done. Next time you want to type out that kind of email, you can just go to the “insert” menu again. When you click on Quick Parts, your new template will be one of the options. Click on it, and the whole template message that you saved will instantly appear. This is a handy tool that most people don’t know is already included in the software that many of us use every day for our emails, and it can save a lot of time in your agency, so I’d recommend sharing it with the rest of your staff. From renewal information update solicitation emails to quote letter emails, certificate of insurance emails, or any of the dozens of repetitive tasks that make the agency machine run smoothly, we could all use a little time back in our day. So, don’t waste time typing out the same email over and over and over: let the computer do that for you.
CORNER EXPERIMENT WITH MICROSOFY SWAY
Tip #4 By Steve Anderson
Because clients’ expectations for how information should be delivered are changing, a simple PDF document may not cut it anymore. You need to be exploring new options for presenting information (in proposals, coverage summaries, or newsletters) in an online multimedia environment.
It is super easy to share and collaborate on a Sway. Others can see your creation on the Web without signing up or downloading additional software. Sharing editing rights with others is also a snap. And you can change privacy settings for more control.
Sway is an app that is part of the Microsoft 365 suite. It lets you create and share interactive reports, presentations, personal stories, newsletters, vacation memories, school and work projects, and more. Microsoft Sway is a digital storytelling app that makes it quick and easy to create an engaging presentation. Add your content, and Sway does the rest.
You can use your Microsoft account to get started. Your Sways are synced through the cloud, making it easy to view and edit across your devices.
Tell Your Story with Interactive Content Bring your story to life with interactive multimedia content. It is easy to add text to your images or snap a picture and pull it right into Sway with your built-in camera. You can also add videos, maps, tweets, vines, interactive charts, graphs, and GIFs. Sway-suggested searches help you find relevant images, videos, tweets, and other content that you can drag and drop right into your creation — no need to juggle apps and web pages to find what you want. You do not need to worry about formatting because Sway’s built-in design engine takes care of it. If the first design is not suitable for you, click the Remix! button to see other options or customize it to make it your own.
Microsoft Sway Ideas Following are some suggestions on Sways you might want to create: Agency capabilities brochure Niche marketing information How to file a claim Convert any articles you have written to a Sway Coverage explanations Proposals To create a Microsoft Sway account, you can go to your Microsoft 365 account and select Sway.
DOES YOUR E&O INSURER HAVE YOUR BACK? By Jeff Albright IIABL CEO
Not all insurance companies are created equal. We all know insurance companies who have a sterling reputation for outstanding claims service and treating their customers right. We also know companies who have a very different reputation. Which category does your agency E&O insurer fall into? In recent years, a bunch of surplus lines insurers have expanded into the agency E&O market. Some have stripped down coverage forms, others are fairly good. Some are price competitive, others not so much. But none of them have substantial market share or deep experience writing agency E&O coverage.
NOMADIC
|
24
PAGE 17
E&OINSURER Continued from page 16 IIABL provides agents professional liability insurance (agency E&O coverage) for the vast majority of our member agencies. Depending upon the nature of the agency, we have access to 15-20 markets. Most of our members are insured by the two leading agency E&O insurers, Swiss Re and Allianz. We also have access to numerous alternative markets including surplus lines insurers. We had an agency insured with a surplus lines insurer that jumped into the E&O business in the last few years. The agency had multiple E&O claims arising out of Hurricane Laura. We were shocked and dismayed when the insurer denied all the claims, which we believe were clearly covered by their policy. We were unable to get the insurer to collaborate with us and the broker was unable to help us reason with the insurer. Our member agency is now litigating against his former E&O insurer. We learned a hard lesson from this case. It matters which company insures your agency professional liability. The Big I has had a national agency E&O program with Swiss Re for over 40-years. The program develops over $100 million in premium. We have had the E&O program with Allianz for almost 20 years. These are the two dominant players in the agency E&O market. The Big I negotiates coverage forms and pricing for the benefit of our members in these national programs. We have direct access to underwriters and claims managers at the highest levels of the companies. We have had outstanding claims experience over all these years. Your agency E&O coverage protects your agency from liability, protects your customers from errors and omissions, and protects the reputation of your agency. Does Your E&O Insurer Have Your Back?
LET'S GET "TOGETHER AGAIN" AT THE BEACH
It has been too long since IIABL has traveled to our beloved home-away-fromhome and buried our toes in the beautiful white sandy beaches of Florida. For me, I joined the IIABL family a year and a half ago who has shared their stories of the unforgettable conventions, time with friends, and memories that I FINALLY get to be a part of. This year, we are shaking things up to create another unforgettable event and celebrate being “Together Again” (or for the first time, if you are me)!
EXHIBIT HALL By Kathleen O'Regan IIABL Director of Communications & Events
Who doesn’t love an exhibit hall? Networking, swag, welcome beverages, and all our friends “Together Again” in one room. We can’t wait to kick off this years Annual Convention with our popular and well attended Exhibit Exposition!
NOMADIC
|
24
PAGE 19
ANNUALCONVENTION AMAZING SPEAKERS Previous Annual Convention agendas don’t hold a candle to this year! Our amazing line up of speakers will cover everything from technology to perpetuation plans, state and national activities, but also leave you inspired to “Never give up. Never quit.” We hope you leave the convention with ideas, actions, and inspiration to bring back to your agency! Check out our agenda and learn more about our speakers!
MOJEAUX MONDAY Our Dessert & Dancing party is moving to Monday night! New Orleans’ Premiere Party Band, Mojeaux, has a play list that is sure to excite our attendees and get everyone on the dance floor. Complete with drinks and dessert, your night will definitely end on a high note.
IIABL’S FABULOUS CASINO NIGHT DON’T MAKE DINNER PLANS ON TUESDAY NIGHT! IIABL is celebrating being “Together Again” with a special party this year and we are rolling out the red carpet! There will be something for everyone at our Casino Night! Attendees will be welcomed by casino “show girls” and receive “funny money” that you can use to play casino games that will be set up in the ballroom – Blackjack, Texas Hold’em Poker, Craps, Roulette, and more! We will have a delicious spread of food & beverage, DJ playing your favorite tunes, and a photobooth to capture your favorite party pics throughout the night. As Casino Night comes to a close, you will turn in your “funny money” in exchange for raffle tickets to win exciting prizes! This is an event not to be missed!
HILTON SANDESTIN EXPERIENCES The Hilton Sandestin is home to our Annual Convention that offers beautiful Gulf of Mexico views, world-class golf options, and so
LOUISIANAAGENT
Continued from page 18 much more. Without fail, our members and attendees leave with lasting memories to cherish for a lifetime. Our agenda is organized so you can mix business with pleasure and experience all that the Hilton Sandestin has to offer. Check out the Hilton Sandestin website for their dining, spa, beach activities, and golf options, just to name a few, and plan your downtime before you arrive! As you can see, we have been hard at work to plan an amazing convention this year and we look forward to seeing all of you this summer! Registration is open and our hotel room block is filling up quickly! Visit our Annual Convention webpage for more information! We look forward to being “Together Again” at the beach with you this June!
AT SOUTH LOUISIANA EXPOSURES TO FLOODING
LOOKING BACK
Gregg Porter, Sr. Flood Territory Manager Selective Insurance
In August 2016, prolonged rainfall from an unpredictable low-pressure system in the Gulf of Mexico stalled and resulted in catastrophic flooding for 21 Louisiana parishes. Several rivers and waterways reached record levels in multiple parishes which resulted in the worst U.S. natural disaster since Super Storm Sandy in 2012.
Did you know that everyone is in a flood zone?
Flooding is the most common natural disaster that occurs. Some agents have a challenging time selling flood insurance to their customers. Many consumers believe that because they do not live “in a flood zone” and they do not have a body of water near their property, it will never happen to them. Not necessarily so.
Did you know that significant flood damage occurs in B, C, or X zones each year? However, purchasing flood coverage when you are in a “nonspecial flood hazard area” can be inexpensive.
Some properties are in “special hazard zones” (A or V) that have the potential to flood every year, and they will be required by their mortgage lender to purchase flood insurance. But does that mean the rest of us are off the hook? No way!
PAGE 22
FLOODINGEXPOSURES
LOUISIANAAGENT
Continued from page 21
So, what are the causes of flooding?
Want to know more about flood There are several sources when water temporarily insurance? covers land it normally does not cover. Some of the common causes of flooding include persistent rainfall, runoff, slow-moving tropical storms, rapid snow melt as well as ice jams. Even a water main break can be considered a flood. Remember, include flood coverage as a recommendation every year at renewal and document if your clients decline coverage. The last thing you want is for one of your insured to have a flood after you failed to offer the coverage to them.
IIABL has the resources you need. They offer semi-annual FEMA flood CE classes–usually a morning class followed by a Q&A session. They also have recorded webinars, ranging from one to three hours with approved CE credits. The Big “I” Flood program gets you access to one of the premier Write-Your-Own flood carriers: Selective Insurance. Selective offers a unique and unparalleled approach to servicing flood customers nationwide. Selective has been rated A (Excellent) or better by A.M. Best since 1930 and has been the flood carrier endorsed by IIABA since 2001. Plus, they provide the experience, dedication and service required to stand up against the competition. Visit iiaba.net/Flood or contact Gregg Porter at 225-397-3658 or gregg.porter@selective.com.
LOUISIANAAGENT
EARN MORE WITH IMS The Independent Market Solutions (IMS) program is more than just a market access solution. For member agencies, it also works like an incubation program where you can gain appointments with various insurance carriers and quickly begin writing business. Many IMS markets require low to no volume commitments, offer competitive commissions, and a pathway to direct appointments. IMS agents also own 100 percent of expirations and can participate in any earned program contingencies. Because IMS offers a mix of standard and niche markets, you don’t have to turn away a client’s request on a risk that your agency doesn’t currently write. Instead, many IMS markets offer great online training resources that make it simple and allow you to write the policy when your client needs it. The IMS menu is constantly changing to include new carriers intended to expand your strike zone. Finally, IMS seeks to perpetuate independent agents rather than consolidate them. Every IMS agent owns their book of business and can qualify to roll that business toward a direct appointment once a pre-determined premium volume is reached. There are no other fees or strings attached. This is what we mean by “incubation”, and it has its privileges! To sign up and start earning more with IMS, click here.
Independent Market Solutions
17 "TESTS" TO DECIDE: EMPLOYEE OR INDEPENDENT CONTRACTOR “I don't have any employees; they are all independent contractors." “What makes them independent contractors," the agent asks. “I pay them using a 1099." OK, so most readers know that the reality of an “independent contractor" is not dependent on how the person is being paid – even if they are paid in mustard. The reality of an independent contractor relationship is based on the facts of the relationship. What follows are 17 “tests" to aide in deciding if the relationship is truly that of an independent contractor or an employee. If more than one or two “tests" are failed, the person is likely an employee based on the facts. And when employee status exists, workers' compensation must be provided, and a premium must be paid. 1) Degree of control. When the worker is a true independent contractor, the contracting party does not have the right to control the
BY: CHRIS BOGGS method or manner of job performance – only the outcome. If the methods and manner are controlled, that's an indication of employee status. 2) Right to discharge. The contracting party does not have the right to discharge an independent contractor as long as contractual obligations are being met. The right to discharge for or without cause is sign of an employee. 3) Right to delegate work. An independent contractor has the right to bring in whomever it wants to accomplish the purpose of the contract. The lack of such ability indicates employee status. 4) Right to hire and fire. An independent contractor has the right to hire and fire help in the performance of the contract. Lack of this right is a sign of employment. 5) Payment practices. Independent
PAGE 27
EMPLOYEEINDEPENDENT contractors are paid by the job not by the hour, week, month, etc. 6) Training. The contracting organization should not provide or require training for the contractor or any inexperienced employees of the independent contractor. 7) Skills. Independent contractors are generally seen as skilled workers. 8) Duration of the relationship. Independent contractors are hired for a specified time period. Continuous, ongoing work indicates employee status. 9) Hours worked. An independent contractor is allowed to set work hours. Employees are told when to show up, take breaks, and leave. 10) Independence. An independent contractor is allowed to and does work for a number of persons simultaneously. If not allowed, that indicates employee status. 11) Tools. Independent contractors provide their own tools. 12) Bids. Independent contractors generally bid for work. Lack of a bidding process often indicates employment status. 13) Profit or loss. Independent contractors may enjoy a profit or suffer a loss from the work bid. 14) Contractual intent. The intent of the parties to create a independent contractor relationship must be in writing. 15) In business. The independent contractor is a principal of his/her own business.
LOUISIANAAGENT
Continued from page 26 16) Sequence of work. An independent contractor is allowed to determine the sequence of its work (not the sequence in which the trade is to be performed). 17) Reports. Independent contractors are not required to submit oral or written reports or attend meetings (other than safety meetings) held by the contracting party.
PAGE 28
EMPLOYEEINDEPENDENT Compare the reality or facts of the relationship to these “tests," if any “test" points to an employer/employee relationship, investigate more closely. Calling someone an independent contractor doesn't make it so; paying them with a 1099 doesn't make it so. To be a true independent contractor requires true independence from the contracting party. Neither the IRS nor the jurisdictional workers' compensation authority look kindly upon such deception. The IRS will get its money and so will the regulatory authority. As an agent, don't take the insured's “word" that a person or group of persons is/are independent contractors – ask the questions. Make sure the insured “passes the test."
LOUISIANAAGENT
Continued from page 27 More information on the various methodologies available for deciding between an independent contractor and an employee is available from Big I's legal department and can be found here.
Debating Ambiguities in Insurance Contracts BY: CHRIS BOGGS
Debating coverage, as an academic exercise, is weirdly fun at least for geeks like me. But on the backside of the debate are real coverage situations and real expenses that may or may not be covered by the subject insurance policy. In short, lives and finances are at stake in the debate. Insurance policies are contracts. Although this appears to be a Duh" statement, many insurance practitioners seem to forget this simple fact. As a contract, the insurance policy is subject to the law of contracts which requires the policy be interpreted in specific ways. Many of not most insurance contract coverage debates revolve around the concept of ambiguity. Is the policy (contractual) provision ambiguous? A contractual provision is considered ambiguous if it is reasonably susceptible to more than one interpretation. Specific requirements apply when deciding if a particular provision is ambiguous. In short: A contractual provision is ambiguous when the provision can be interpreted
differently, is reasonably susceptible to more than one understanding, or may have two or more meanings. Contractual provisions are NOT ambiguous simply because the parties disagree on the meaning. To be ambiguous, the provision MUST be reasonably susceptible to more than one meaning with nothing in the contract to clarify which meaning is intended. However, this gauge of ambiguity does not readily apply when an insurance policy is involved because the insured is not expected to be knowledgeable about the trade or business of insurance. When an insurance contract (policy) provision is reviewed, the court focuses on the reasonable expectations of the average insured. One court said it this way, "[A] contract of insurance, drawn by the insurer, must be read through the eyes of the average man on the street or the average housewife who purchases it." (Lacks v. Fidelity & Cas. Co. of New York, 306 N.Y. 357, 363 (N.Y.1954).) Regardless what we, as insurance practitioners, think a term means (or understand it to mean from our training and experience), the court
PAGE 31
AMBIGUOUSCONTRACTS concerns itself with how the buyer understands the language. What would or should the insured reasonably expect when he or she reads the policy? Notice, the condition considers what the insured should reasonably expect once the policy is read; not what the insured thinks it should say. Courts make a legal presumption that the insured read the policy; although we know this is likely not the case, this presumption dictates that the contract be interpreted as if the policy had been read and interpreted by a reasonably intelligent person. Again, the insured is not expected to know the trade and customs of insurance, but they are expected to interpret the policy as a reasonable person in the same or similar situation would interpret the provision. If such interpretation is reasonable and differs from the insurance carrier's interpretation, the provision can be considered ambiguous. However, the courts hold that an interpretation is not reasonable if it strains or tortures the policy language beyond its reasonable or ordinary meaning. In other words, the insured's
LOUISIANAAGENT
Continued from page 30 understanding can't be ridiculous. The court will not consider a policy provision ambiguous if the application of the insured's interpretation creates an illogical or stupid (my technical term) result. Court review of supposed "ambiguous" terms or provisions is done on a case-by-case basis utilizing a holistic approach applying specific cannons of contract construction to judge ambiguity. Courts: Read the contract as a whole to 1) determine if the intent can be discerned from the contract; and 2) assure that the meaning given to the provision in question is not taken out of context and does not control or alter the meaning of the entire contract; Apply ejusdem generis and/or noscitur a sociis to the specific word or phrase. This means that when a word or phrase follows a list of specifics, the word or phrase is interpreted to include only items of the same type as those listed. Basically, the court believes that, "Text without context is a pretext for a prooftext." Essentially, the phrase in question can't be
PAGE 32
AMBIGUOUSCONTRACTS interpreted or made to mean one thing when the context points to something else; Hold that specific language governs over or outweighs general language; Hold that the same word used in multiple sections has the same meaning in each use; and State that improper punctuation or the lack of punctuation does not create ambiguity or alter the clear meaning of a term or policy provision. In Viking Pump, Inc. v. Liberty Mut. Ins. Co., the court quoted, Punctuation is a most fallible standard by which to interpret a writing. The court will take the contract by its four corners, and having ascertained what its meaning is, will construe it accordingly, without regard to punctuation marks, or the want of them. [T]he words control the punctuation marks, and not the punctuation marks the words." Applying these guidelines, the trier of fact (the judge or the jury) declares a term or provision ambiguous or unambiguous. If the provision is unambiguous, the court interprets the contract as a matter of law, looking to the clear meaning of the text to determine intent (known as the "four corners" rule). However, if the provision is judged ambiguous, intent becomes a question of fact for the judge or jury to decide. Most insurance practitioners know that because insurance contracts are contracts of adhesion (meaning the insured is "stuck" with it), when ambiguity is found, the decision goes against the party who drafted the contract (the insurance carrier). In Latin this is contra proferentem or "against the offeror or drafter." In most coverage debates, the goal of all parties is to force the carrier to pay claims that are owed, but not pay when it doesn't owe anything. It's as simple as that. Insurance geeks engaged in debating insurance coverages are not trying to force any carrier to pay anything it doesn't owe; likewise, we don't want a carrier to fail to pay what is owed. Geeks want the contract followed. Sometimes both sides of the debate have a reasonable argument, which means an ambiguity might exist. If so, a trier of fact must be engaged to decide if an ambiguity does, in fact, exist.
LOUISIANAAGENT
Continued from page 31 When the court date (or dates) arrive, the ultimate decision of ambiguity rests on whether the insurance carrier can make the insured's interpretation appear unreasonable; or whether the insured convinces the judge or jury that its interpretation is one that any other reasonable person would have. When the insured's view is deemed reasonable, the carrier loses.
Judging Ambiguity A Quick Review Questions that must be answered to establish the possibility of ambiguity: 1. Is the term or provision subject to two or more reasonable interpretations? 2. Could or would an "objective reader" arrive at the same or a similar conclusion? 3. Do the parties simply disagree on the meaning? 4. Would either party's interpretation strain or torture the policy and result in an illogical or absurd application of coverage?
PAGE 33
AMBIGUOUSCONTRACTS Continued from page 32 "Yes" answers to questions "1." and "2." point to the possibility of ambiguity. "Yes" answers to questions "3." and/or "4." hint that ambiguity likely does not exist. If ambiguity is possible, courts (the trier of fact) make the final decision by: 1. Reading and applying the contract as a whole; 2. Applying the concept of Ejusdem Generis and/or Noscitur A Sociis to the specific word or phrase; 3. Giving greater weight to specific language than is grated to general language; 4. Applying the same meaning to terms throughout the contract; 5. Ignoring punctuation relative to the weight of the policy language; and 6. Applying Contra Proferentem.
3 WAYS TO CLOSE THE GAP BETWEEN STRATEGIC PLANNING AND EXECUTION
By: Drew Yancy, Ph.D. Partner, InCite Performance Group
For too long, businesses have separated strategic planning from strategic execution - but they need both to succeed. Nearly 60% of organizations struggle to bridge the gap between strategic planning and execution, according to a study by the Economist Intelligence Unit. For too long, businesses have separated strategic planning from strategic execution—but they need both. After all, we are rewarded based on the strategy we actually execute, not the one we planned to.
1) Expand the vision of strategy. Most agencies operate on a very narrow definition of strategy. Historically, they have focused their strategic planning efforts on incremental improvements to current offerings, not on fundamental new value creation. In a pre-COVID-19 world, with stable industries and in-person work environments, this made relative sense.
Often, executives neglect to bake execution into the very beginning of the strategic planning process. Here are three steps agency leaders can take now to help rectify this:
No longer. Our traditional ways of operating have been disrupted and clients and prospects are increasingly looking to their insurance agent to
PAGE 36
PLANNING&EXECUTION help them innovate their way out of the many existential threats they face. Agencies should refocus their strategic planning efforts on innovation—the consistent execution of new value for stakeholders. Understood this way, insurance agencies become powerful engines of innovation because they often interact with a variety of stakeholders: clients, prospects and carriers. What challenges are your stakeholders facing that you can help solve? That is a great place to begin any strategic innovation effort. 2) Engage your entire agency leadership in the strategy process. Strategic planning has tended to default to a small subset of core decision-makers. However, innovation is a team sport and often the bigger and more diverse the team the better. Insurance agencies can leverage their broad ecosystems to enhance their innovation outcomes. 3) Create phased milestones. Nearly 40% of projects fail due to a lack of clear goals and milestones, according to a PMI study. Strategic planning is not a one-time event. It is an iterative process and innovation strategy requires a precise balance between form and
LOUISIANAAGENT
Continued from page 35 freedom. A tried and true three-phased approach looks like this: Start broad and plant as many new ideas as possible. Grow those ideas by clustering and vetting them so that they are prioritized based on their attractiveness and executability. Harvest the top priorities through experimentation and adaptation. This is what makes strategic planning focused on new value creation fundamentally different than traditional strategic planning, which often moves from idea directly to execution. Now more than ever, insurance agencies and brokerages and their clients are dealing with significant unknowns. Experimentation is the fastest and cheapest way to reduce risk and ultimately deliver new value. Closing the execution gap is not going to be easy. If innovation were easy, everyone would be doing it! But we must, and the rewards for doing so are substantial.
LOUISIANAAGENT
4 WAYS TO HELP YOUR TEAM MOVE FROM TACTICAL TO STRATEGIC COMMUNICATIONS Learn how to stop being an order taker and take the lead as a strategic advisor
By: Sally Ann O'Dowd Given the digital, always-on nature of work, communications professionals are moving at an insanely fast clip these days. The need to respond to colleagues’ requests requires tactical action, and that means we risk losing strategic foresight. But fret not: it is possible to regain control of the communications function, even as the volume of work seems to grow. To learn how, we talked with Julie Baron, principal of Communication Works and Ragan Consulting Group affiliate consultant specializing in change and strategic communications. 1. Understand the organization’s business goals. It is critical to understand the company’s mission and to have direct access to business and strategic growth plans – whether you’re at a PR firm or on the corporate side with internal clients. Is the company entering a new market, launching a new product, or aiming to hire more diverse talent? It might be all three at once. Whatever the corporate priorities might be, comms pros need to understand them to ensure their ideas and activities ladder up to the broader initiatives.
“It’s important to educate our clients on the complexities of communications, the processes we use, and the information we need up front, and how early we need to be brought into the planning process,” Baron says. “They come to us for consulting and advisement.” 2. Ask questions. Just like a reporter conducts interviews to write a story, communicators need to ask questions, whether you’re preparing an annual plan or working on a short-term project. “Ask good questions and do great listening so you can understand what the goal is, making sure you have this strong understanding of the problem to be solved,” Baron says. “Problems are complex and communications isn’t always the only way to solve a problem; it’s usually just one piece of the solution.” Asking questions helps you develop a sense of ownership, while demonstrating your strategic acumen. It’s all part of the discovery process, which takes time. Jumping into projects, on the other hand, could lead to failure. “You can’t say, “I
PAGE 38
TACTICALSTRATEGIC will have it fixed for you tomorrow,’” Baron says, leading us to her third point. 3. Do your research. Once you understand the business goals, conduct further research to validate your ideas. “Don’t base plans on assumptions, guestimates or gut feelings,” Baron says. “Use hard data and evidence. Use a variety of research tools – it might be focus groups, surveys, interviews. Tap into existing data within your own company, such as customer satisfaction and employee surveys.” You can also pilot communications on a limited scale to see what works. Let’s say there has been an increase in accidents at your company’s three factories. You’ve been asked to create a communications plan to educate employees on safety protocols. Conduct a pilot project at one factory to test the content’s effectiveness; if safety incidents decline among targeted employees, it’s a good sign the plan is working; if not, you need to test other messages and communications channels before reaching out to all three factories. “Communicators need to ask, ‘What is available to me from a data standpoint that is insightful to feed into plans instead of creating new research?’” Baron says. 4. Learn when to say no It can seem difficult, or dicey, to say no when a CEO or another high-ranking executive asks for a press release or a newsletter article, often with a sense of urgency. But sometimes saying no leads to a broader conversation – and those ever-important questions. If research, data and your own experience tell you a press release on, say, a product you already promoted six months ago isn’t the right idea, stand your ground. Sometimes you need to push back.
LOUISIANAAGENT
Continued from page 37 “Sometimes the need to do that comes up when somebody comes with a tactical request, but we haven’t done a good job of advising clients on what types of information we need to be strategic,” Baron says. It’s important to remember your role as a counselor. When someone comes to you with a tactical request, sometimes a no can become a “yes and.” Respond with a question: ‘What business goal is this supporting?’” RCG specializes in corporate communications training, consulting and strategic counsel. Schedule a call with Kristin Hart to learn how we can help you improve your strategic communications plan. Follow RCG on LinkedIn here.
AN AGENT
UNDERINSURANCE BY: BILL WILSON, INSURANCECOMMENTARY.COM I know, I know. I’ve been remiss in blogging and I’ll work on that. I try to only blog when it’s something important and/or of high value, so that limits how often I ‘bother’ you. In addition, I am working feverishly on my newest book about the history, evolution, and meaning of the property damage exclusions in the industry standard CGL policy dating back to at least 1941. I’ve spent well over a year researching this and I have amassed a great deal of source material, from “bureau” filings and circulars to drafting committee minutes. Perhaps for the first time, how and why these exclusions evolved over the decades will be revealed.
In May, I will be attending a conference in New Orleans of industry consultants and serving on a panel discussion of all of the associated issues involved in underinsurance. At the same time, the actions of other groups are addressing potential solutions with valuation system vendors, agents, insurers, and regulators. Perhaps later this year (if I ever get this book written), I’ll focus my attention on a white paper that outlines the issues and possible solutions. In the meantime, below is John’s article….
Is it time to re-visit the methodology used by agents to determine replacement costs and/or reIn the meantime, today I’m posting a guest article from construction costs? How confident are you that John Putnam, CPCU, a Colorado insurance consultant the real property replacement values that you and former agent who has spent years doing pro bono develop are sufficient to either replace or rebuild? work with consumers and business owners following If a natural catastrophe hit your community, several high profile wildfires in the state. A HUGE issue would you have the same confidence in your following these catastrophes is the degree of replacement or rebuild figures? As the increasing underinsurance of properties. Not only are many of frequency and severity of natural disasters occur, them underinsured for even an isolated fire or one of the first questions in their aftermath is why windstorm claim, but when you compound that with does underinsurance one of the first issues. the almost simultaneous destruction of hundreds or thousands of properties, supply and demand issues In the aftermath of the Marshall Wildfire in greatly enhance the underinsurance situation. Boulder County, Colorado, the Denver press has
PAGE 40
ACTIONUNDERINSURANCE continuously explored these questions from the insured survivor’s perspective, but there has been little discussion from the insurance industry perspective regarding this issue. The purpose of this blog is to start a discussion on the continuing perceptions of underinsurance especially after natural disasters to determine if there are changes needed to better estimate the replacement costs on both personal and commercial policies that agents sell to our customers. Insurance to Value (ITV) is a basic concept which many insurance personnel are trained at the onset of their careers. Although counselled that we are not appraisers, adjusters, agents, and underwriters were provided with training and valuation tools aka costimators which seem to work very well over the years. Based upon conversations with many frontline agent/brokers assisting with their customer’s valuations, these tools do not change in their basic structure and do not regularly leave their customers underinsured. In retrospect, were they just lucky because they did not face many total losses or did their continual efforts to monitor and
LOUISIANAAGENT
Continued from page 39 adjust the replacement cost values (RCV) help achieve those excellent valuation outcomes. Bottom line, this methodology and training has worked quite well over the past fifty years to assist customers with valuing RCVs. Many agents have experienced occasionally competitor agents / companies using similar tools to undervalue required limits which permitted them to underbid higher, more correct valuations. While this behavior still exists, it does not occur as frequently as it once did and, in the new insurance marketplace used to occasional natural catastrophes, it presents another opportunity for the agent to advocate protection over lower prices. Why does this subject matter to the author? When he was embarking into semi-retirement, he was asked to serve as a volunteer insurance consultant to the Waldo Canyon wildfire recovery team, Colorado Springs Together (CST) because he was not directly contracted with any of the
PAGE 41
ACTIONUNDERINSURANCE insurers who faced 347 total losses and some additional damaged properties. Starting that volunteer effort, he was initially concerned about the potential for underinsurance based upon other insurance catastrophes, local rumblings in the local press, and chattering in social media. This recovery process was a huge learning experience in many different aspects of how insurance policies deliver in a major natural disaster, but happily the issue of underinsurance did not prevent one of the most complete major wildfire recoveries experienced by a large urban fire. His early fears of underinsurance became unfounded as the Waldo survivors, their builders, and their companies navigated through the many different coverage “buckets” ie debris removal, law and ordinance, extended replacement, inflation guard, and landscape allowances which helped to close most rebuild gaps. In fact, the most extreme Coverage A dwelling underinsurance situation that he encountered (approximately 40%), the policy holder was able to close the gap with the above additional coverages and their company’s endorsement which doubled the extended replacement and law & ordinance limits when it resulted from a declared natural disaster. What were the lessons learned from his CST experience? There are too many stories to recount in this short piece, but the following were most significant: A community-based recovery team that allows for many segments of the local community to participate in the recovery goal is an important attribute to a quick and complete recovery. The recovery team needs a strong leader to keep the team focused on the main task – rebuilding the neighborhood. A community and team focused on minimizing politics, controversy, and adversarial relationships among any of the stakeholders is a critical component of a solid recovery. The encouragement of the survivors to better understand their policies and limits as well as the insurance claims process facilitates quicker resolution of any outstanding issues. Local economic conditions can be a positive driver of the recovery. The Waldo Recovery occurred during the end of the 2008 recession, so labor and supplies were more readily available to the recovery.
LOUISIANAAGENT
Continued from page 40 The recovery team had a self-imposed one-year recovery time limit because virtually all the pieces for the Mountain Shadows Neighborhood recovery were in place by the end of the year. Survivors, neighbors, the city, and team members were pleasantly surprised that, despite the early alleged obstacles, an amazing outcome was collectively achieved. After such a positive recovery experience, he followed many other wildfire recoveries both in Colorado and other areas in the United States. Interestingly, he is not aware of another publicprivate recovery team approach as done here in Colorado Springs. In most cases, it appears that recoveries are driven by the local governments which tend to be slower due to the more bureaucratic approach that government must take to conduct all of its business. Why does this matter in a discussion of underinsurance? Slow recoveries exacerbate the effects of underinsurance.
PAGE 42
ACTIONUNDERINSURANCE As Boulder County faces its recovery from the Marshall Fire, the topic of underinsurance seems to dominate its early recovery preparations. Certainly, the recovery challenge is more than three times greater than the Waldo Recovery which will certainly further slow the recovery based solely on the scale of recovery. Without being imbedded in the Marshall recovery team, it is difficult to fully access the extent of the underinsurance at this time although there are some early warning signs of potential concern: The limited supply of builders needed to rebuild all the destroyed residences may be a driver of higher replacement/reconstruction costs; The unprecedented increases in the local building costs over the past two years that may not have yet been incorporated into the costimator valuation processes; Initial indications of added building code requirements needed to rebuild are very concerning and would not have been included in any costimators; Debris removal delays which will slow the actual reconstruction; Unusual supply chain challenges; Popular insurance advertising that promotes price competition v coverage adequacy; Other natural catastrophe competition for resources ie Kentucky wildfires, California wildfires, Louisiana hurricanes, etc; Less streamlined rebuild permitting processes; and The continual reminder of underinsurance which creates more negativity among the survivors that their recovery will be impossible. Going forward, it is critical for the insurance industry to take the lead in starting to diagnose any shortcomings in the procedures and systems for both valuing properties, as well as best practices to streamline recoveries. As we know, insurance coverages/limits may differ among the homeowners policies that different insurance companies write. Perhaps, it is also time to realize
LOUISIANAAGENT
Continued from page 41 that there may be different valuation needs for natural disasters. Of course, the biggest hurdle is to overcome the average consumer’s belief “it can’t happen to me” paradigm. What can front line agents do to start or aid this discussion? Here are some initial first steps: 1. Identify either personal or commercial accounts where you think whatever costimator being used that may either under or over insure. 2. Identify any differences within your agency on how real property valuations are done and retrain as necessary so there are consistent processes. 3. Check with local claim departments and construction businesses to determine what the going rate is to build in your community/region. 4. Double check a sampling of real property valuations periodically to make sure they are responsive to local building costs and national inflation and supply line conditions. 5. Refer any valuations which are either over or under valued to the insurer and ask them to check to make sure that they agree with your valuation and have continuous conversations regarding insurance to value. 6. Start tracking any variations in valuation so valuation adjustments can be made as necessary. 7. Share any variations in values with your local agency associations so the magnitude of any underinsurance can be assessed. This is especially important in locations more frequently visited by natural catastrophes. As a long-time independent agent, John knows agents can make great differences for both their customers and the industry. In the meantime, if you have examples of under or over insurance using the various costimators provided by your companies, please share them with me at jeputnam@aol.com.
SCREEN TIME:
After nearly two years of pandemic-prodded digitalization, virtual sales proficiency presents an opportunity to stand out from the crowd.
Virtual Selling Is Your Ticket to Sales Success
Time to get over your Zoom fatigue. If you thought that selling insurance virtually was a temporary detour during the coronavirus pandemic, you have another thing coming— if you want to gain a competitive edge, that is.
Annemarie McPherson
For Daschle Larsen (pictured left), risk executive and principal of McKinneyOlson Insurance in Sioux Falls, South Dakota, his agency began selling virtually before the pandemic. “We started implementing a virtual selling strategy as a competitive advantage in our area a few years back," Larsen says. “When COVID-19 forced the remote and virtual discussions, we were already efficient in the space and were able to continue to hit the ground running." NOMADIC
|
24
PAGE 44
VIRTUALSELLING
LOUISIANAAGENT
Continued from page 43
“We started sending prerecorded videos to need." prospects, as well as existing clients," he continues. “And we do reviews over Zoom with existing Setting the Scene clients—and prospects if they're open to it." Consumer behavioral shifts prompted ALLCHOICE Insurance in Clemmons, North After nearly two years of pandemic-prodded Carolina, to center its sales strategy around the digitalization, virtual sales proficiency presents an virtual medium—a leap the agency had also taken opportunity to stand out from the crowd. before the pandemic. “There is an ability to outplay the competition here," says Dave Shaby, co-author of “Virtual Selling: How to Build Relationships, Differentiate, and Win Sales Remotely" and chief operating officer of RAIN Group. “Our research suggests that most people are not great at virtual selling. But if you can improve, you can widen that gap." And agencies who commit to the virtual sales process will be the frontrunners as the industry seeks to catch up to customer expectations. “We live in a digital age, so insureds are more open to the virtual process," Larsen agrees. “Expand that client base by giving them what they want and
“Five or six years ago, we'd gotten to the point in the iteration of insurance selling when no one wanted to come to the office to discuss a quote," recalls Jack Wingate, founder and CEO at ALLCHOICE. “It turned into, 'Hey, I'm going to email you this proposal and then I'm going to call you,'—virtual selling 1.0, if you will—and there was a lot lost in translation." “We would start only talking about pricing because what we lost was the kitchen table," Wingate explains. If an agent can sit down across from someone as if they were together at a kitchen table and walk through the policy and
PAGE 45
VIRTUALSELLING coverage, the conversation is driven by relationship, he says. “But if all I'm doing is sending a PDF, the prospect only looks at the price—and then that number is the only thing that matters." To add the all-important kitchen table back to the equation, “we started honing in on video proposals, virtual selling 2.0," Wingate says. “That allows us to change the conversation to what really matters to the buyer, which is the coverage." “We'll pull the quote, analyze it, and then record a video walking through the coverage for the client," says Jared Bellmund, managing partner at ALLCHOICE. “I got an email this week from a guy who was blown away that I spent 10 minutes putting together a video answering a bunch of his questions. It allows us to be advisers again."
Commercial Break Where virtual selling really shines, though, is commercial lines. Approximately 70%-80% of business-to-business decision-makers prefer remote human interactions or digital self-service, according to McKinsey & Company. Chris Langille, founder and lead support of Advisor Evolved, an InsurTech company that provides agencies with marketing and sales resources, has observed agents' success with the company's QuoteVids video tool in commercial sales. “We get feedback all the time about how folks closed a huge account and the only thing they did differently than the other broker was send the client videos," he says. ALLCHOICE has focused on commercial lines for their virtual selling 3.0 discussions over virtual platforms. “Personal lines are more transactional and consumerbased, and many people expect that commodified product until they get our video proposal—and
LOUISIANAAGENT
Continued from page 44 that does bring a huge change in their experience," Bellmund says. “But with commercial lines, I have done a full meeting with commercial clients in Microsoft Teams three or four times now." In addition to meeting customers' needs and increasing a competitive edge, virtual sales “has allowed us to expand our footprint geographically," Larsen says. “We're based in South Dakota, but our core states are really South Dakota, North Dakota, Nebraska, Iowa and Minnesota. Now that we can prospect digitally with either prerecorded videos or live Zoom calls, there's no limit to our reach." Further, virtual selling saves time. “Before, someone would have to spend so much time either on the road or in airports," Shaby says. “Now, most people report that they can be more productive and have more time to focus on outreach, prospecting and research." Additionally, since agents often hear the same questions over the years, “we just go ahead and pre-answer those questions we know they'll have," Wingate says. “You look like a genius, but realistically you've just saved yourself time."
PAGE 46
VIRTUALSELLING Roll Film What's the catch? Why haven't more agencies picked up virtual sales? Virtual selling is often perceived as different from in-person sales, which can be intimidating, Wingate says. “Agents have made good business in the past, and they look at virtual selling as something different than what they've done before," he explains. “But it's not. The medium has just changed. All you've done is implement a few pieces of technology. Virtual selling is just selling." Here are eight steps to implement virtual selling in your agency:
LOUISIANAAGENT
Continued from page 45 3) Prepare with virtual in mind. “In addition to all the things you need to prepare for if you were selling in-person—knowing your clients, understanding their needs, how you meet those needs—the virtual sales process also means you need to consider technical glitches when you are trying to accomplish those goals," Larsen says. “I always find it helpful to do a trial run." “A lot of buyers report that the virtual meeting itself is generally disappointing when it comes to technology mishaps," Shaby says. “Make sure you take care of all the things that you can control in your presentation."
4) Perfection is the enemy of the good. “People feel like they need to be polished," Wingate says. 1) It doesn't have to be all virtual. Virtual sales isn't just relegated to emergency lockdown mode— But what's more important is being authentic, especially when it comes to prerecorded videos. it's the next selling model, and the long-term The temptation to come up with a manicured implementation can be combined with more production should be avoided. traditional prospecting. “My first touch is normally not virtual—in fact, probably only 20% of my sales come from online," Bellmund says. “I am out in the community shaking hands, and then I transition them to the virtual process." The optimized sales workflow allows ALLCHOICE to get the best of both worlds. “Understand your funnel and how to incorporate people into your process," Bellmund says. “We've put a lot of work into our virtual process—it's all about figuring out ways to transition people into the funnel." 2) Give up on silver bullets. A plethora of tools exist—for instance, ALLCHOICE uses customer relationship management software Keap to move prospects through the sales pipeline via automatically triggered messages—but at the end of the day, it's about pressing the record button. “I used to put a link to a YouTube video in an email and say, 'Hey, watch this,'" Bellmund says. “The automation and tools are nice, but you don't have to buy a new software to do virtual selling."
“If someone were sitting in your office, you can't stop and start," Bellmund says. “If you can have a real-time 45-minute meeting, you can do a 10minute explainer video. You're going to have to pause or check your notes, and that's okay. It should just be like you're sitting across the kitchen table from the client." “The first time you do something, it'll be worse than the second and third time," Wingate adds. “Just try something." 5) Focus on collaboration. “The biggest advantage of virtual selling is the ability to collaborate with a buyer," Shaby says. “Your virtual toolkit, from annotation software to even just sharing your screen, makes everything a collaborative exercise." That's different from in-person selling. “Imagine if you walked into an in-person meeting, whipped out a piece of paper and started writing things down," Shaby continues. “People wouldn't like that. They want eye contact and visual
PAGE 47
VIRTUALSELLING engagement. But in a virtual setting, you have some license to annotate and post things, because you're both looking at a screen. Fill in the blanks together." 6) Make the return on investment (ROI) crystal clear. While researching “Virtual Selling," Shaby asked buyers what the biggest gap in sales skills is. “It's the ability to create a compelling ROI case," he says. “The ROI case is really hard to make virtually, to bring home those tangible benefits. That's why you have to collaborate." 7) Be positive. “A big part of sales is the five senses, and you're obviously missing a lot of things when you're not in the same room," Langille says. “They can't see your body language, they can't fully grasp your mood. Go the extra mile to smile." “In person, they're forced to sit there and interact with you," he adds. “That's not the case in a virtual setting."
LOUISIANAAGENT
Continued from page 46 8) Stay committed. “Most people are too quick to give up on a new concept if it doesn't bear fruit right away," Larsen says. “We're going to continue to implement virtual sales at our agency, and new tools are always being developed." “I'm curious to see what the next resource will be," he says. “How do we strategically implement that into our business practice?" AnneMarie McPherson is IA news editor.
PAGE 48
LOUISIANAAGENT
Carey Wallace Agency Focus In the midst of the most active M&A marketplace that our industry has ever experienced, often times there is still a cloud of secrecy that exists inside an agency about the agency’s future. That silence can often times lead to unintended and unfortunate outcomes especially in the case of talented and high performing staff members. Often times agency owners keep their plans and the plans that they have for their agency’s future to themselves. On one hand, this is understandable as some agency owners are uncertain about their plans. For those agency owners that do have an idea of what their future plans are, they may choose to keep that plan to themselves to either keep their options open or to avoid impacting their business in the form of lost accounts or carrier relationships. Many times, that silence can be detrimental to the agency.
Buzz in the Industry Any person in our industry who is paying attention knows that the opportunity to sell at a hig multiple has never been greater especially for well run, growing agencies that are over a million dollars in revenue a year. In some instances, the
opportunity exists for smaller agencies. You can open any insurance magazine, look on social media or listen to industry podcasts and learn about agencies that have sold almost on a daily basis. In addition, there is a lot of buzz and conversations that occur about this activity and the impact it has on the staff and culture of agencies that have sold. This creates a level of uncertainty and concern for the staff that works in an agency that has an aging owner and the future plans are unknown, which describes the majority of agencies.
How Do I Fit? When you combine silence with uncertainty, human behavior kicks in and causes many to form a story or prediction in their heads with the information that they have available to them. Some may start to ask more questions and if those questions go unanswered, they will look for signs, pay closer attention and fill in the gaps with the clues they see. An agency owner may interpret the questions as being nosey and avoid the question which may create even greater uncertainty. If viewed from the employee’s
PAGE 49
SILENCEPROBLEM perspective, the agency owner will realize that the questions are being driven by the need to know what their future is and how the future of the agency may impact the employee directly. Understanding the generational differences goes a long way in understanding and interpreting these questions and anticipating the needs of your staff. For many, being a part of something is important and providing them with information that eases their minds and provides them with the reassurance that their environment is safe, predictable and provides them with ample opportunities is key. Silence accomplishes none of those things.
Unintended Consequences
If you have a high performer, they may want to carve out a pathway to ownership inside the agency, or at a minimum have a level of comfort in knowing that the environment that they are thriving in will continue to exist for the foreseeable future. Silence does not bring them that comfort and the end result could include that star employee looking for opportunities elsewhere, especially if they believe that the agency may be at risk of being sold. In order to avoid this situation, agency owners can take the following steps:
LOUISIANAAGENT
Continued from page 48 Build a Plan – Take the time to outline what would happen to the agency, staff and customers if something were to happen to you. Knowing that there is a plan in place will bring great comfort. Communicate – Once you have a plan outlined, do not keep it a secret. Share the plan with key employees. You can protect the agency with confidentiality agreements and take other precautions, but keeping the plan to yourself does not give anyone any sense of comfort, but you. Create a Pathway to Ownership – For those owners that want to provide an incentive for their key employees to stay with the agency and participate in success and future ownership of the agency, invest in defining that pathway to ownership. For the agency owners that are uncertain of their future plans, at a minimum focus on putting a disaster plan in place to protect the agency and all of the people that depend upon that agency if something were to happen to you. For more information about planning for your agency, contact carey@agency-focus.com.
FIRST LOOK: ACT 'MFA' Survey ACT Survey Report
The regulatory and security requirements around MultiFactor Authentication – or 'MFA' – are beginning to impact all of us in one form or another. ACT is receiving input from agents and other stakeholders that in response to cyber regulations from bodies like Gramm-Leach-Bliley, NY DFS and the NAIC Model Security Law, businesses are instituting MFA in various ways. One MFA example is as agents try to access their agency's carrier portal. Vendors such.
as management systems are also instituting MFA in various forms. Agencies themselves are implementing MFA login confirmation. We're clearly at a critical inflection point with MFA in our distribution channel. To that end, our goal is to gain insights separately from our carrier, agency, and vendor stakeholders on the current state of MFA implementations. Of the myriad issues and actions needed to address
PAGE 51
SURVEYRESULTS Continued from page 50 cyber risks and implement a solid cybersecurity program, Multi-Factor Authentication (MFA) is quickly gaining focus as a requirement. Let's be clear – MFA is not the only regulation to be addressed, nor is it the 'silver bullet' that prevents all potential incursions. But thanks to regulations now in place across the country from NY DFS/NAIC Model Law adoptions/GrammLeach-Bliley, pressure is being put on insurance companies and therefore agents to implement and use MFA. We're seeing MFA in place in many areas of our personal business interactions, and our industry is working to provide additional security layers using MFA. Because of this, ACT fielded a survey of our IA distribution carriers, agents, and vendors between late January through February to gain insights on: Implementing/using MFA, Specific MFA solutions in place, Adoption rates & Consistency of use, Mobile strategies, Integration with agent & company systems, and Ongoing strategies. We will use the results of this survey within our ACT Security Issues work group to discuss & determine industry actions & attempt to drive consistency around MFA. We'll also be sharing more in-depth analysis from the work group, hold an 'MFA Town Hall' at our upcoming April 19-20 ACT Tech Summit (schedule & registration HERE), and discussing in more detail throughout forums across our IA distribution channel. For a full graphical report of survey responses, click HERE.
PAGE 52
LOUISIANAAGENT
IIABL EDUCATION APRIL 2022 CALENDAR OF EVENTS SUNDAY
MONDAY
TUESDAY
WEDNESDAY
Mar 27
28
29
30
3
4
5
6
LIVE WEBINARS! 8-11a Flood Insurance, FEMA & the NFIP
10a-12p Why Business Income is the MOST Important Property Coverage
LIVE WEBINAR! 12-2p ISO's 2022 Homeowners' Changes
2-4p Properly Calculating & Insuring the Business Income Exposure
10
17
11
18
12
LIVE WEBINAR! 8-11a Cyber - Evolution, Exposures, Incidents & Insurance
19
LIVE WEBINARS! 8-11a That's Personal: Home & Auto Exposures Your Insured Doesn't Share (& Why That's Bad) 12-3p Ethics: Essentials for the Insurance Producer
24
25
26
13
LIVE WEBINARS! 8-10a Why Certificates of Insurance... Just Why?
12-2p ISO's 2022 Homeowners' Changes
20 LIVE WEBINAR! 1-2p Three Commercial Property Insurance Problems and How to Fix Them
27
PAGE 53
LOUISIANAAGENT
& EVENTS THURSDAY
31
FRIDAY
Apr 1
SATURDAY
2
Lisa Young-Crooks!
7
LIVE WEBINAR! 8-11a Homeowners in Real Life: Tales of Claims & Coverage
8
9
12-3p Agent's E&O: Duties, Best Practices, Operations, Workflows & Certificates
14
15
16
IIABL OFFICE CLOSED
21
22
23
29
29 30
IIABL YOUNG AGENTS
Crawfish Boil
28
IIABL CE ON DEMAND E&O Risk Management Ethics Flood Commercial Lines Courses Personal Lines Courses Professional Development
OTHER EDUCATIONAL RESOURCES
PAGE 54
LOUISIANAAGENT
ADVERTISER INDEX COMPANY
PAGE
COMPANY
PAGE
Accident Fund Insurance Company of America Agile Premium Finance Allied Trust Insurance Company Amerisafe AmTrust North America AmWINS Access Home Insurance Company Berkshire Hathaway GUARD Insurance Company Burns & Wilcox Ltd. Commercial Sector Insurance Brokers EMC Insurance FCCI Insurance Group Foremost Insurance Group Forest Insurance Facilities The Gray Insurance Company Homebuilders Self Insurers Fund Imperial PFS Iroquois
38 36 41 10 33 6 11 22 51 13 19 51 45 44 33 20 47
Lane & Associates, Inc. LCI Workers' Comp Lighthouse Property Insurance Group LUBA LWCC National General Progressive RISCOM RLI RPS/Risk Placement Services SafePoint Insurance Stonetrust Summit United Fire Group UPC Insurance Wright Flood
17 54 7 9 23 17 15 31 49 32 25 27 29 40 34 8
PAGE 56
LOUISIANAAGENT
IIABL 2021-2022
BOARD OF DIRECTORS & OFFICERS PRESIDENT, DONELSON P. STIEL David H. Stiel, Jr. Agency - Franklin PRESIDENT-ELECT, MICHAEL SCRIBER Scriber Insurance - Ruston SECRETARY-TREASURER, ARMOND K. SCHWING Schwing Insurance Agency, Inc. NATIONAL DIRECTOR, JOHNNY BECKMANN, III Assured Partners - Metairie PAST PRESIDENT, BRENDA CASE Lowry-Dunham, Case & Vivien - Slidell YOUNG AGENT REPRESENTATIVE, BRITTNI LAGARDE Southern Insurance Agency - New Orleans ANN BODKIN-SMITH Thomson Smith & Leach Insurance Group - Lafayette MATTHEW DEBLANC Continental Insurance Services - Marrero ROB W. EPPERS Risk Services of Louisiana - Shreveport MATT GRAHAM Lincoln Agency - Ruston CHRISTOPHER S. HAIK Haik Insurance Holdings, LLC - Lafayette STUART HARRIS McClure, Bomar & Harris, LLC - Shreveport ROSS HENRY Henry Insurance Service, Inc. - Baton Rouge BRET HUGHES Hughes Insurance Services, LLC - Gonzales CHARLES H. LEBLANC Bourg Insurance Agency, Inc. - Donaldsonville LYDIA MCMORRIS Alliant Insurance Services - Baton Rouge A. EUGENE MONTGOMERY, III Community Financial Insurance Center, LLC - Monroe JOE KING MONTGOMERY Thomas & Farr Agency, Inc. - Monroe HARTWIG "ROBBY" MOSS, IV Hartwig Moss Insurance - New Orleans PAUL R. OWEN John Hendry Insurance - Zachary ROBERT LOUIS PALMER Insurance Underwriters, Ltd. - Metairie MARTIN "TEENY" PERRET Quality Plus - Lafayette ROBERT G. RIVIERE Riviere Insurance Agency - Thibodaux ROBERT STONE Stone Insurance, Inc. - Metairie
