Included in this issue: •
How to become a 24/7 Agency
•
TrustedChoice.com Improvements
•
Waves of Change...Oceans of Opportunity
IIABL STAFF
Waves of Change...Oceans of Opportunity!
4-8
Jeff Albright Chief Executive Officer jalbright@iiabl.com
The Independent Insurance Agent System
11-12
Francine Berendson Director of Communications & Events fberendson@iiabl.com
How to Become a 24/7 Agency
14-15
TrustedChoice.com Improvements
30-31
Mike Edwards, CPCU, AAI Director of Education medwards65@aol.com
How to Add Services and Reduce Customer Premiums
35
Kim Jackson Education & Membership kjackson@iiabl.com Karen Kuylen Director of Accounting kkuylen@iiabl.com
Ask Mike
16-23
E. Lee Mowe Marketing Representative lmowe@iiabl.com
Commissioner’s Corner
33-34
Rhonda Martinez, CIC Director of Insurance rmartinez@iiabl.com Jamie Newchurch Insurance Services jnewchurch@iiabl.com Lisa Young-Crooks Executive Assistant lyoung@iiabl.com
IIABL Calendar
27
Rate & Rule Filings
28
Tech Tips IIABL Partners
24—26
38 Louisiana Agent 3
IIABA Chairman-Elect Vaughn Graham swears in the new 20172018 IIABL Board of Directors. IIABL President-Elect Neil Record awarding the President’s Gavel plaque to outgoing IIABL President Richard Jenkins.
Over 400 insurance agents, wholesale brokers, insurance company representatives, and industry vendors attended the IIABL Convention at the Sandestin Beach Hilton June 18-21, 2017. With spouses and guests, the 767 attendees at this year’s meeting marked the largest attendance in many years. 59 exhibitors crowded the Exhibit Exposition, the largest number of exhibitors in recent history. IIABL would like to thank the wholesale brokers, insurance companies, and vendors who participate as Partners, sponsors, exhibitors and attendees. Our convention would not be such a success without your support! The Exhibit Exposition was crowded during the Opening Reception as old friends were reunited and new friends were made. Many people enjoyed the beach, golf, and other amenities of Sandestin on Sunday and Monday, before tropical storm Cindy put a damper on things Tuesday. IIABL President, Richard Jenkins, presided over the Opening Business Session. New officers and directors were installed, including Neil Record with the Record Insurance Agency in Clinton as IIABL President; Johnny Beckmann with J. Everett Eaves as President-Elect; Joey O’Connor with the O’Connor Insurance Group as Secretary-Treasurer; Lee Schilling as National Director. Louisiana Agent 4
Neil Record—President Record Insurance Agency—Clinton
Joseph Cunningham, Jr. Cunningham Agency—Natchitoches
John L. Beckmann, III—President Elect J. Everett Eaves—New Orleans
Donna DiCarlo Riverlands Insurance Services—LaPlace
Joseph A. O’Connor, III—Secretary/Treasurer O’Connor Insurance Group—Metairie
Morris Funderburg Reeves, Coon & Funderburg—Monroe
H. Lee Schilling—National Director Schilling & Reid Insurance—Amite
Stuart Harris McClure, Bomar & Harris—Shreveport
Richard D. Jenkins—Past President Moore & Jenkins Insurance—Franklinton
Ross Henry Henry Insurance Service—Baton Rouge
Donnie Stiel—Young Agent Representative Stiel Insurance of Acadiana—Lafayette
Bret Hughes Hughes Insurance Services—Gonzales
Byram H. Carpenter, III Moreman, Moore & Co—Shreveport
Philip McMahon Paul’s Agency—Morgan City
Brenda Case Lowry-Dunham, Case & Vivien—Slidell
Joe King Montgomery Thomas & Farr Agency—Monroe
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2017-2018 BOD Continued
Paul Owen John Hendry Insurance Agency-Zachary Martin Perret Quality Plus—Lafayette David T. Perry Arthur J. Gallagher RMS—Baton Rouge Robert Riviere Riviere Insurance Agency—Thibodaux Armond Schwing Schwing Insurance Agency—New Iberia Michael D. Scriber Scriber Insurance Services—Ruston Donelson P. Stiel David H. Stiel, Jr. Agency—Franklin
One highlight of the convention was an astounding show by memory expert Ron White. Monday morning before the Opening Business Session, Ron White went around introducing himself to convention attendees. An hour later, White asked anyone he had met to stand up. Nearly 200 attendees stood up. When he called each person’s name, they sat back down, and in just a little while Ron White and put every single person back in their seat! It was truly amazing. Later, White had the audience list 35 two digit numbers. About ten minutes later he recited the entire string of numbers by memory, and then recited the numbers back in reverse! Ron White went on to give attendees a five-step process to remembering names and other important information. It was a great presentation.
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Nationally recognized agency management expert Virginia Bates conducted two education seminars. “Serious Insurance Games” was an interactive game show format used to discuss a variety of insurance subjects. “Improving Your Revenue Stream” provided ideas on how producers can increase their book of business and agencies can generate more revenue. Everyone had a great time Tuesday night when The Tip Tops rocked the house and everyone danced, danced, danced. Insurance Commissioner Jim Donelon lead off the Closing Business Session on Wednesday morning with a review of important insurance legislation that passed during the 2017 Regular Session of the Louisiana Legislature.
Aubie Knight, CEO of the Independent Insurance Agents of North Carolina, gave an outstanding presentation about the “Changes in Insurance Distribution.” Knight challenged IIABL members to pay attention to challenges from “InsurTech” distribution of insurance on the Internet, and be prepared to meet the changing expectations of consumers. He also encouraged agents to measure, analyze or justify every agency activity to insure productivity. Aubie Knight suggested that every agency should improve the customer experience delivered by their agency so that they can differentiate themselves from other insurance distribution alternatives. Finally, he warned agents that insurance companies are not satisfied with old fashioned insurance agencies, and if independent agents do not meet changing customer expectations, insurance companies will move to other insurance distribution channels.
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IIABA Chairman-Elect Vaughn Graham, an agent with the Rich & Cartmill Insurance Agency in Tulsa, Oklahoma closed out the convention with news from the national Big I. Vaughn discussed the important work that IIABA does in federal government affairs, including the current fight on Capitol Hill to reauthorize the National Flood Insurance Program and protect the commissions of member agencies. He also discussed the importance of the national Trusted Choice consumer brand that lets consumers know why independent agents are the best way to buy insurance, and www.TrustedChoice.com which gives Big I members a meaningful presence on the Internet and delivers leads for online shoppers.
One of the greatest challenges to the insurance industry is finding & training employees. IIABL is working hard to help our members. One of those efforts is supporting and recruiting from UL Monroe. Dr. Christine Berry is the professor who developed the Risk Management & Insurance Program at ULM. Dr. Berry was unable to be with us but Ernest Finch with Thomas & Farr Insurance Agency in Monroe spoke to the attendees on her behalf. Ernest has first hand experience as he is a graduate of the ULM Risk Management & Insurance Program and serves on the Alumni Advisory Board for the program. Check out their YouTube Video.
There are always interesting things to learn at the IIABL Convention. The networking opportunities are unbelievable. And a good time is had by all. Plan NOW to attend the 2018 IIABL Convention June 17-20, 2018.
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by Chris Burand The independent insurance agent (IA) system is pretty darn basic. It is fundamentally about selling insurance. It is not about:
•
Joining an aggregator to make more commission without selling more insurance.
•
Joining aggregators/clusters to have access to more companies.
•
Divining coverages.
•
Running agency management systems better.
•
And for most, it is not even about marketing (niche programs are the possible exception).
The IA system is about selling, period. The other items are secondary.
A long, long time ago in a time where horses and buggies were still prevalent, insurance distribution was born. At that genesis, where it was determined insurance would be sold by agents, a fork in the road was created. One fork was for captive agents. That fork promised the carriers would be effective marketers, the agents would assist but mostly clients would come to them or the agents would call using the carriers’ brands to gain an opportunity to quote. In return, those agents were paid less and had fewer options to offer clients. The other fork stipulated agents do their own marketing and selling. Because these agents were too small to effectively market, the end result was these agents had to sell and the brand they were selling was them, personally. No one recognized the carriers they represented and the carriers did not do much advertising or marketing. In return, these agents were paid well, gained ownership of valuable assets (their books of business), and had access to many carriers enabling them to offer their clients many more choices. They could also service a much wider range of
customers. These are obviously the IA’s. The IA’s fundamentally are about making sales, one sale at a time. Period. Otherwise, IA’s are not necessary. The entire model is based on an agent building one trusting relationship and then one sale at a time. The model is not designed to cause dozens of prospects to call the agency every day or ask for web based quotes. No trust exists in either of those scenarios and the IA system requires the client trust the agent and the agent trust the client to thrive. To leave that core strength is to endanger the entire model because captives, direct, and the web can all make sales without trust far more cheaply and effectively than independent agents can ever hope to do. I meet agency owners and company people regularly who are repelled by the thought of selling. They think selling is an awful, disingenuous manipulation of the consumer regardless of whether the consumer benefits. They truly believe selling is unethical. To sell is to cross the line into unethical territory. These well-meaning folks truly need to find a different career or start believing in the benefits of selling because otherwise, they are a true mismatch. I meet others who are truly scared of selling. I and probably most people that readily admit we’re in sales get that. Everyone, mostly, has some fear of rejection when selling but some can push through that fear and others cannot.
Unfortunately, the anti-sales people are combining more and more with the scared-of-sales people to push IA’s into marketing. Marketing, in so many ways, is for sissies. Marketing provides a cover behind which personal accountability can hide. In sales, a person either makes the sale or does not make the sale and everyone knowns whether the sale was made or not. In marketing, if sales don’t happen, there are delays between introducing the marketing and sales (if sales do happen) and marketing campaigns are
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almost always feel-good group endeavors so personal responsibility is limited. Marketing, when it works, is designed to cause the consumer to call the retailer (or the retailer calling the wholesaler). This makes those in the “sales is unethical” camp feel better about themselves because if the consumer calls the agency, the agency does not have to sell and therefore, does not have to engage in unethical behavior. It is even better if the customer buys insurance on a web-based platform because that is proof the purchase is entirely the client’s initiative and no selling is involved.
at a time that customizes coverages and solutions for each individual client.
Chris Burand is president of Burand & Associ-
ates, LLC, an insurance agency consulting firm. Readers may contact Chris at (719) 485-3868 or by e-mail at chris@burand-associates.com. NOTE: None of the materials in this article should be construed as offering legal advice, and the specific advice of legal counsel is recommended before acting on any matter discussed in this article. Regulated individuals/entities should also ensure that they comply with all applicable laws, rules, and regulations.
I am not being cynical or sarcastic. I am simply repeating what these people have told me. The more people who want to rely on marketing whether within the IA footprint or with captives, online distributors, or direct writers, the more opportunity is created for people willing to stay true to the fundamental heart of the IA model and build one trusting relationship at a time. Part of building trusting relationships depends upon the agent working with the consumer to identify that person’s or that company’s individual risks and exposures and building coverages specifically for them. Every policy should be custom built and a large portion of the public wants this. They do not always know enough about insurance to articulate their desires but they truly do want agents to take the time to learn about their companies with them. A good salesperson will not abandon this market. It is large. It is lucrative. It has higher profit margins and higher retention if managed well. Furthermore, customizing coverages provides one of the best chances on earth to help protect lives, businesses, and jobs and rebuild lives, businesses, and jobs after a loss. By selling, a producer has a rare opportunity to make a huge difference in their clients’ lives. Hardly any professions exist where such a huge difference can be made and of the ones that do exist, being a selling insurance agent may pay the best. It is a convergence of the best of all worlds. The chance to do good by selling far exceeds any good done by people that want to market because they think selling is dirty. For true success and our clients’ best interests, it is imperative for independent agents to stay honest to the IA model. Sell one trusting relationship
The Big "I" Diversity Task Force is presenting the new four-part "Right Start Training Series: An Agency Toolkit to Grow Your Business and Gain Appointments." The series is intended to give new agency owners and startup agencies the tools and techniques they need to not only gain but also retain appointments with top carriers. The series of one-hour monthly sessions begins at 9 a.m. June 29 with "Understanding Your Agency Operating Style" and continues July 20, Aug. 24 and Sept. 14 with additional sessions covering employees, company visits and yearly planning and goal setting. If you are unable to make one of these sessions click here to request a virtual replay.
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BY JOYCE SIGLER & STU DURLAND
Let’s face it—we live in a 24/7 world. Gone are the days when a successful business could only operate during standard operating hours. Now, consumers can order from their favorite restaurant at 2 a.m., call a ride whenever and wherever they need one, and deposit a check when sitting on their couch. But the insurance industry has not caught up with the modern business world. According to the Insurance Digital Transformation Survey, fewer than half of agencies operate 24/7, and even fewer offer client portals or mobile apps. In order to compete in a market where competition is fierce, independent agents must embrace technology and offer on-demand service. Of course, becoming a 24/7 agency is easier said than done. With limited staff and financial resources, implementing services and technologies can seem like a monumental task. To help, here are the answers to four big questions most independent agents ask when they take the plunge. What exactly does 24/7 mean? Finding ways to operate around the clock— especially if you’re a smaller operation— can make any independent agent’s head spin. But 24/7 service does not have to mean quoting and binding policies at 3 a.m. It could simply extend as far as allowing your customers to access important insurance documents when the office is closed, or offering a mechanism for reporting claims to the agency or company after hours. Before doing anything else, decide what type of 24/7 services you want to provide.
This will help you narrow your focus and point you in the right direction of additional help you might need. 2) Where do I begin? Becoming 24/7 is not something you can decide to do one day and start the next. You should develop a plan that outlines your agency’s approach to implementation. Providing on-demand service is not as simple as installing new technologies or launching a mobile app. Staff needs training, and customers need to be notified once your agency is ready to answer their questions. All-day practices could also alter some of your normal agency operations. When my agency became 24/7, we stopped mailing policies, change confirmations and ID cards. By creating a plan, you can work through all the different changes these new services will require and ensure nothing catches you off guard. 3) What types of technology should I implement? There’s no set formula; you have to decide what works best for your operation and your customers. But client portals and mobile technologies such as apps can give your customers access to important documents such as ID cards or certificates of insurance without contacting your agency. Several agency 24/7 service is not a fad, management sysand agencies that hope to tem vendors now run the gamut must adapt provide these tools, linking clients to modern business directly to the data in your AMS. It is also important to ensure these systems have reporting capabilities. You want to monitor who is logging into the portal and what types of services they are using. This information tells you when you need to reach out to a customer—such as when they have a question about a policy change—and when to leave them alone, like if they just need to reprint an ID Louisiana Agent 14
card. This approach will enable you to walk the fine line of providing great customer service and over-servicing. 4) How will becoming 24/7 impact my staff? Some staff may fear that new digital tools will take over their jobs, but that’s not the case. Independent agents have large workloads—if anything, these technologies will ease some of the burden by eliminating timeconsuming tasks like pulling insurance documents and sending them to the customer. Make sure you keep your staff informed during the entire process so they know these technologies will not be replacing them. When the tools are installed, ensure that you have a robust training program for all employees to familiarize them with the different platforms and answer any questions they have. Remember that you’re not necessarily making your staff less busy—you’re providing them with more
time to cross-sell. 24/7 service is not a fad, and agencies that hope to run the gamut must adapt to modern business practices. While taking the first step can be hard, the process can go smoothly with detailed planning and transparent communication with your staff and clients.
Joyce Sigler is vice president of Jones & Wenner, an independent insurance agency in Fairlawn, Ohio. Stu Durland is vice president and owner of Seely & Durland, Inc. in Warwick, New York. Sigler and Durland are organizers of the Insurance Digital Revolution, an industry initiative created to advance adoption of digital technologies.
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IIABL Director of Education, Mike Edwards is your source for technical questions. Contact Mike at medwards65@aol.com or 678.513.4390
Subject: Riding Lawn Mower Causes Wildfire – Excluded by HO and CGL
Q.
I recently read an article in an insurance newsletter about a homeowner whose riding lawn mower somehow caused a wildfire that burned over 7,600 acres, including 5 structures. The article did not discuss insurance coverage, but I wonder if there would be coverage if that had been my insured? And what if he wasn’t mowing his own yard, but maybe a neighbor’s yard, or a vacant lot he owned away from his residence? Last year, our church participated in a community work day. A couple of our members brought their riding mowers and cut the grass at the church, as well as at the community playground, which is right across the street from the church. Would they be covered by the CGL of the church?
A. I read the same article, and it was a whopper of a fire. By my old high school (Class of ’65) math, the fire consumed around 12 square miles. (640 acres = 1 square mile.)
A wildfire started by a riding lawn mower is certainly rare, compared to the myriad activities that take place in or near wilderness areas which could cause fires. A few days ago, I read an article about the causes of wildfires. Data from the US Forest Service show that between 1992-2012, 84% of wildfires were caused by human activity, and the remaining 16% by lightning. Some of the unusual causes included sparks from a titanium-clad golf club, or the titanium pedal of a mountain
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mowers. bike, striking a rock. The article said that a titanium spark is around 3,000 degrees F. And a trail ride on a horse can cause a fire if the metal horseshoe strikes a rock. It’s quite possible that neither the Homeowners Policy nor the CGL (Commercial General Liability) Policy will provide any coverage for your insured, in the situations you’ve described. The Homeowners Policy coverage for a riding mower used away from the insured’s residence is very limited, far more so than coverage for an ATV away from the residence. And the CGL coverage is very restrictive for individuals in circumstances like this.
Section II Exclusions Motor Vehicle Liability Section II excludes liability for “motor vehicles” registered, or required to be registered, for use at the place of the occurrence, subject to certain exceptions. Exceptions for service vehicles. The last four editions of the ISO Homeowner Program (2011, 2000, 1991, and 1984) provide an exception to the "motor vehicle" exclusion for a service vehicle (such as a riding mower) which is: HO 00 03 05 11: Used solely to service a
For the discussion below, assume your insureds are Jack and Jill Smith, who are both named insureds on a Homeowners Policy. Commentary is based on ISO (Insurance Services Office) forms and endorsements. Proprietary forms may be different.
residence.
HO 00 03 10 00: Used solely to service an
insured's residence.
HO 00 03 04 91: Used to service an in-
sured's residence.
HO 00 03 04 84: Used to service an in-
sured’s residence. Issue #1: Homeowners Policy and riding
Comments:
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(1) These four editions of the ISO Homeowners Program provide three different versions of the exception for service vehicles. (The 1984 and 1991 editions are the same.) The differences between the three versions of the exception are subtle, but substantially different in the coverage provided. (2) For reference, all four editions define a “motor vehicle” as “a self-propelled land or amphibious vehicle,” which brings a riding mower within the definition. A “vehicle” is “Any conveyance used in
transporting passengers or things by land, water, or air.” [Black’s Law, 9th.]
(3) Another key issue in coverage for riding mowers is that the four versions of the motor vehicle exception make no distinction for ownership (owned, rented, or borrowed), or horsepower. All are treated the same. ATVs and other recreational vehicles have much broader coverage. Based on the situations you referenced in your question, here is how coverage is provided for riding mowers under each of the four editions of the ISO Homeowners Program. Assume in each situa-
tion that the riding mower somehow sparks a fire which spreads over a large area, causing extensive property damage and bodily injury. Situation #1: Jack is mowing his own lawn. HO 00 03 05 11: Jack is covered, since he is solely servicing “a residence.” HO 00 03 10 00: Jack is covered, since he is solely servicing “an insured's residence.” HO 00 03 04 91: Jack is covered, since he is servicing “an insured's residence.” HO 00 03 04 84: Jack is covered, since he is servicing “an insured's residence.” Situation #2: Jack and Jill trailer their riding mower to their lake house. Jill begins mowing the lawn, while Jack jumps into his pickup truck and drives the ¼ mile to the church, to help with Volunteer Day at the church. HO 00 03 05 11: Jill is covered, since their second home is “a residence.” HO 00 03 10 00: Covered, since their second home is “an insured’s residence.”
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HO 00 03 04 84: Not covered. The neighbor’s house is not “an insured’s residence.” HO 00 03 04 91: Covered, since their second home is “an insured’s residence.” HO 00 03 04 84: Covered, since their second home is “an insured’s residence.”
Notes: (1) If Jack and Jill had owned only a lot at the lake, where they planned to build a house one day, they would have no coverage under any of the four editions, since a vacant lot is not a residence. Situation #3: After Jill finishes mowing the lawn at their lake house, she then mows the yard at their next door neighbor’s house, since they are out of the country on vacation. HO 00 03 05 11: Jill is covered, since she is solely servicing “a residence.” HO 00 03 10 00: Not covered. The neighbor’s house is not “an insured’s residence.” HO 00 03 04 91: Not covered. The neighbor’s house is not “an insured’s residence.”
Situation #4: Jack calls Jill on her cell phone, and asks her to drive their riding mower down to the church. Since there will be a wedding at the church next weekend, the volunteer group would like the have the area immediately around the church mowed. HO 00 03 05 11: No coverage. The church is not “a residence.” HO 00 03 10 00: No coverage. The church is not “an insured’s residence.” HO 00 03 04 91: No coverage. The church is not “an insured’s residence.” HO 00 03 04 84: No coverage. The church is not “an insured’s residence.”
Notes: (1) In addition to there being no coverage while using the riding mower at the church, there is also no coverage en route, while Jill is driving the mower from their lake house to the church. (2) In the 2011 edition, the coverage applies for service vehicles which are “used solely to service a residence.” (3) In the 2000 edition, the coverage applies for
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service vehicles “used solely to service an insured’s residence.” (4) When ISO first inserted the word “solely” into the service-vehicle provision in the 2000 edition (later retained in the 2011 edition), it caused considerable debate, disagreement, confusion, and subsequently, a number of claim denials based on the new language. Most frustrating for all concerned is that the ISO filing documents gave no explanation for the purpose or intent of the change, which is contrary to their usual procedures. The most extreme interpretation is that if Jack or Jill ever used their riding mower for any purpose other than to service “an insured’s residence” (2000 edition), or “a residence” (2011 edition), their Homeowners Policy would no longer provide any liability coverage, in the future, even while they were mowing their own lawn. (5) In the Additional Information section below, there are several articles that discuss the issue arising from the inclusion of the word “solely” in the 2000 and 2011 Homeowners Program.
cles” registered, or required to be registered, for use at the place of the occurrence, subject to certain exceptions. Exceptions for recreational vehicles: A motorized land conveyance designed for recreational use off public roads, not subject to motor vehicle registration and: HO 00 03 05 11 and HO 00 03 10 00: (1) Not owned by an insured; or (2) Owned by an insured provided the "occurrence" takes place: (a) On an "insured location" as defined in Definition B.6.a., b., d., e. or h.; HO 00 03 04 91 and HO 00 03 04 84: (a) Not owned by an insured; or (b) Owned by an insured and on an "insured location"
Situation #5: Coverage options or alternatives. (1) The ISO Homeowners Program has no endorsements that I am aware of which will fill any of the gaps discussed above. But some proprietary programs might offer broader coverage, or endorsements. (2) Given the broad insurance market for the plethora of recreational vehicles today, it is quite likely that there are some specialty coverages for riding mowers, garden tractors, etc. At a minimum, inland marine or Farm coverage forms might fill some of the gaps. (3) Some personal umbrella policies provide broader coverage than the underlying Homeowners form. (4) Several of the articles listed in the Additional Information section include excellent discussion of coverage options. Issue #2: Homeowners Policy and ATVs & similar recreational vehicles. Section II Exclusions Motor Vehicle Liability Section II excludes liability for “motor vehiLouisiana Agent 20
al vehicles are not covered on: “c. Any premises
Comments: (1) As noted in the discussion above on riding mowers, there is no distinction made in the ISO Homeowners Program between owned and non -owned service vehicles. Both are subject to the same provisions. (2) In contrast, non-owned recreational vehicles are covered anywhere within the territorial limits of the Homeowners policy, which is worldwide. Thus Jack and Jill are not covered while mowing a vacant lot they own at the lake, but they are covered riding a large, powerful rented or borrowed ATV in the Outback of Australia. Go figure! (3) Among the four recent editions of the ISO Homeowners Program (2011, 2000, 1991, and 1984), there is only one important difference in coverage. In the two older editions, owned recreational vehicles are covered while on any “insured location.” In the two newer editions, the coverage is extended only to certain “insured locations” (“B.6.a., b., d., e. or h.”). In these two newer editions, owned recreation-
used by you in connection with a premises described in a. and b. above”; or “f. Land owned by or rented to an insured on which a one-, two-, three- or four-family dwelling is being built as a residence for an insured”; or “g. Individual or family cemetery plots or burial vaults of an insured.” Issue #3: CGL Policy and riding mowers.
Comments: (1) In the ISO CGL, like in the Homeowners Policy, there is an “auto” exclusion. However, in CGL, certain types of vehicles and equipment are considered “mobile equipment,” and not “autos.” A riding mower would fall into this category. In addition, the liability coverage is subject to only two exclusions arising from “mobile equipment”: (a) “The transportation of "mobile equipment" by
an auto owned or operated by or rented or loaned to any insured;” or (b) “The use of "mobile equipment" in, or while in practice for, or while being prepared for, any prearranged racing, speed, demolition, or stunting activity.” (Spoiler
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Continued page 22 Louisiana Agent 22
alert: lawn mower racing is growing in popularity countrywide.) [Click] (2) Jack and Jill could be “insureds” in the CGL of the church, but only if they are using their riding mower “within the scope of their employment” by the church, or “while performing duties related to the church activities,” or as “volunteers,” etc. Or, they might be added as “insureds” in the CGL by endorsement, such as Church Members (CG 20 22), Club Members (CG 20 02), etc. (3) One important caution regarding the CGL of the church (or any organization or business): beware the CG 21 44 04 17 Designated Premises Limitation. The 2017 edition limits CGL Coverage A only to BI/PD which: “(a) Occurs on the premises shown
in the Schedule or the grounds and structures appurtenant to those premises; or
(b) Arises out of the project or operation shown in the Schedule.” So a church function that takes
Louisiana has the highest cost per workers’ compensation claim and the lowest average benefit payment per claim, according to a recent 18-state report by the Workers Compensation Research Institute (WCRI). The report, which analyzed 18 comparable states and used available statistics dating back to 2010, found that the average workers' compensation claim in Louisiana costs more than $57,000, nearly $16,700 higher than the 18-state median. Workers' compensation claims in the Bayou State issue $47,401 on average in benefits payments, the lowest in the 18-state review.
place at any location not shown on the Schedule of the CG 21 44 is excluded, unless it is “appurtenant to those premises.” Additional Information: “Are Riding Mowers Covered by the HO Policy? Are You Sure?” “Homeowners Coverage Gaps? Here Are Some Mower.” “Insuring Lawn Tractors Used Off Premises” “No Coverage for Riding Mower Until It’s Actually Used?” “Insuring Miscellaneous Personal Vehicles” “Insuring High-Value Lawn Equipment” “New ISO Filing on CG 21 44 Designated Premises Limitation”
These materials are intended for educational purposes only and should not be relied upon as legal advice. Please consult a qualified attorney for legal advice.
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For a growing number of clients, email is simply too inconvenient and too slow. Their preference is to communicate with you using a text conversation. Agencies need to be able to respond to this customer preference by embracing text conversations as a viable communication option. And, policies and procedures need to be put in place to make sure these conversations can be consistently and accurately documented. Capturing these conver-
sations is not easy.
While a few agency management system platforms are incorporating outbound and inbound text messaging functionality, you still have the problem of clients texting individual producers’ mobile phones. These messages are outside of the current documentation capture process. Putting a procedure together, and training each producer on how to manage text messages consistently, is an ongoing problem for agencies. One possible solution is iExplorer — a software program from MacroPlant. iExplorer is a multipurpose tool that allows you to manage your iPhone and iPad better. Continued page 24
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One of its capabilities that could be helpful to manage text messages is the ability to export any text conversation on your phone to an external file. Capture a Text Conversation to PDF iExplorer can transfer iPhone text messages to a Mac or Windows PC for archiving or sharing and is quick and easy to use. It can export any SMS, MMS, and iMessages to your computer as PDF, TXT, or CSV files. The PDF format is the most popular since it looks very similar to the way the text messages appear on your device with the text bubbles on each side and with the shared photos in place. All formats will include the original time stamps. You can also export any photos and other attachments separately in their original size and format. How to Capture a Text Conversation Here’s how: Open iExplorer and connect your iPhone, iPad or iPod.
1. Click on the Data tab in the Device Overview screen and click on Messages.
2. If you have not created an iTunes backup yet on this computer, you will be asked whether to make one (choose Yes). If you did already have an iTunes backup, and it is more than 24 hours old, iExplorer will ask whether you would like to Use Latest Backup or Back Up Now to create a new one.
3. Make your backup selection, and iExplorer will load your text messages. Browse your Messages and choose an Export option. You can transfer an entire conversation or selected parts of a conversation or export all text messages in a single transfer. You can also just export the shared photos and files from a conversation separately. If you need to find a particular part of a conversation, iExplorer lets you search your text messages by keyword via the Search field in the upper-right
Continued page 28
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corner. The PC version will search all conversations, and the Mac version will search the conversation you have selected. Once you have exported your text messages to your computer, you can then view the PDF, TXT, or CSV files in any desktop application that can read those file types. The PDF file option probably will be the most common, and it is a simple matter of attaching the PDF with the text conversation to the client file as your documentation.
Additional articles on texting can be found here and here. I do realize there are some options available for capturing a text conversation from your phone to a more permanent storage solution. Because iExplorer is easy to use it might be a good option for you to explore. What are the methods you are currently using to capture a text conversation for client documentation?
Without the generous support of our sponsors & exhibitors we could not have a great convention that we are able to give to our members each year.
Please check out the list of the sponsors & exhibitors for the 2017 IIABL Convention and if you see them or talk to them please give them a big ‘THANK YOU’!!
Gold Sponsors Silver & Bronze Sponsors Exhibitors
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Webcasts E&O Risk Management July 6, July 20, August 1
Ethics July 18, July 19, August 8
Available on Demand
Available on Demand
Flood July 24, August 4
Available on Demand
Commercial & Personal Lines Courses Click above title for courses & dates for 2017 Available on Demand
Seminars E&O Seminars 9/19—Shreveport 9/20– Lafayette 9/21—New Orleans 9/22—Covington
IIABL Fall Education Conference October 19 Shreveport Convention Center
Events Louisiana/Mississippi Young Agents Conference 8/17—8/19 Beau Rivage—Biloxi
On-Demand Webcasts Masters Series: The Master Series are unique agency management courses from industry experts. in the Masters Series.
CSR Training: The Customer Service Representative is key employee in every agency and is a difficult commodity to find.
Environmental Strategists (eS) Becoming a certified environmental Strategist™ (eS) will equip you with the knowledge to identify, manage and transfer environmental exposures impacting everyday business.
Cyber Risk Manager (cyRM) Completion of the Cyber Exposures & Insurance – Training for Agents & Brokers course qualifies you to register for the cyRM certification for FREE.
Pre-Licensing Online prelicensing 3 optional study packages available Click here for additional information Louisiana Agent 29
Company
Coverage Type
Overall % Impact:
Overall $ Impact:
Number of Policyholders:
Changes
AmGUARD Insurance Co EastGUARD Insurance Co NorGUARD Insurance Co
16 – Workers’ Comp
-7.70%
-$269,286
640
Effective: 6/1/2017 Renewal: 6/1/2017
Amica Mutual Insurance Co
4 – Homeowners
10.0%
+$331,846
1,451
Effective: 9/1/2017 Renewal: 9/1/2017
Milwaukee Casualty Ins Co Amtrust Ins Co of Kansas Technology Insurance Co Republic Underwriters Ins Co Republic Fire & Casualty Ins Southern Underwriters Ins Co
9 – Inland Marine
-1.51%
-$87,480
394
Effective: 1/1/2018 Renewal: 1/1/2018
California Casualty Indemnity
19 – Private Passenger Auto
+7.0%
+$56,416
341
Effective: 10/1/2017 Renewal: 10/1/2017
Hanover Insurance Co Massachusetts Bay Ins Co Hanover American Ins Co
5 – Commercial Multiple Peril Ave Businessowners Program
+0.9%
+$37,037
1,038
Effective: 9/1/2017 Renewal: 12/1/2017
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Continued page 30 Louisiana Agent 30
Agencies continue to ask TrustedChoice.com to improve their ability to attract and write the business they want. We delivered. Over the past 6 weeks, the Advantage profile has improved dramatically. ·
NAICS codes have been expanded to six digits
·
You can choose whether or not you want to work with consumers who don’t have current insurance
·
Individual producers can be listed with their own email and phone numbers, including the ability to receive referral notifications via text rather than email
Agencies have told us that getting the right referrals to the right producer in the agency is key to successfully writing the business. These new changes are designed to allow you to target
what sorts of consumers get to each of your producers. Although it isn’t required, TrustedChoice.com now provides the ability to custom configure the appetite engine in a number of new ways. We have expanded the North American Industry Classification System (NAICS) to six digits from three, allowing a more refined definition of exactly which types of business your agency prefers. Rather than just saying you want generic construction, perhaps you want to write New Single Family Construction, but not Residential Remodeling. Toggle them on and off, simple as that. The agency can also choose whether or not they want to be displayed to insurance buyers when that buyer is not currently insured. This
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can keep experienced producers from spinning their wheels in working with difficult to place or new businesses. We recognize that agency staff is made up of individuals with differing levels of experience and capabilities. To support this, we have brought out the first of a number of improvements designed to allow opportunities to be more effectively routed within individual agencies. Agencies can now add staff to their agency profile, and provide individual contact and appetite information for specific producers.
Or one producer in the office prefers to work on contractors, while another only wants to talk to light manufacturing risks. The producer level appetite engine selections make this possible. These enhancements are designed to provide a foundation for additional powerful benefits exclusively available to members of the IIABA. If you would like to know more about an Advantage subscription, please dial 1-855-372-0070 and touch 1 for sales.
Perhaps the agency wants to focus all personal lines opportunities to a young producer. Now you can just provide that producer with personal lines of business, and send incoming opportunities to the producer’s cell phone.
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Commissioner’s Corner
Each year, lawmakers are called upon to
balance not only the budget but also the needs of our citizens and the resources available to provide same. As the state insurance regulator, the Louisiana Department of Insurance faces similar pressures - balancing the needs of insurance consumers with the industry’s need to run competitive businesses. We keep this principal in mind when we introduce or sponsor legislation. At its core, our goal with legislation is to promote measures that will strengthen the marketplace and better protect insurance consumers. The insurance industry can shift quickly and it’s critical that we routinely revisit our processes to ensure we are keeping up with the best practices other regulators have implemented. An example of this is Act 182 we had introduced that establishes reciprocity when it comes to which producers can sell insurance policies issued by Louisiana Citizens Property Corporation (Citizens). Up until 2016, every producer licensed to sell property and casualty insurance policies in Louisiana could offer policies issued by Citizens. That changed during the 2016 regular session when a law was passed to only allow resident producers to sell Citizens policies. (That law was in response to Mississippi’s policy which bars Louisiana agents from selling Mississippi Windstorm Association policies.) Act 182 amends the previous law so that agents from other states can sell Citizens insurance policies in Louisiana if Louisiana agents can sell the equivalent of Citizens insurance in their states. Another legislative change we proposed specifically impacting producers is Act 154 which provides for revisions to the producer license renewal schedule. As a result of the passage of that legislation, licenses will be due for renewal based on each producer’s license number, not by the line of authority. The National Insurance Producer Registry, or NIPR, recommended this revision to the renewal schedule. This change will take effect January 1, 2018 and we will issue a bulletin outlining these changes.
Also part of our legislative package, Act 9 strengthens and increases the utility of the LDI voluntary white list of surplus lines insurers that you, as brokers, often use when placing coverage. Louisiana law provides that a surplus lines insurer may write any of the lines of property and casualty insurance in Louisiana for which it is also licensed to write in its state of domicile. Since our state law has not provided a mechanism for us to keep current on what those lines might be, Act 9 requires all surplus lines insurers desiring to be included on our voluntary white list certify to the LDI on an annual basis the lines of property and casualty insurance that it writes in its state of domicile. Companies will provide this information using a standard form developed by the NAIC (Certificate of Compliance). By requiring the company to file it annually, we can keep our data current. It is a simple form (usually one page) that will provide a mechanism for electronic filing so that companies can file it quickly and easily. We also proposed Act 219 which provides an option for policyholders to exclude personal property coverage following a declared disaster. An insurance company that issues a homeowner’s insurance policy that includes personal property coverage is required to make this exclusion option available upon written request of a policyholder after a declared disaster. The insurer must calculate the appropriate reduction in premium for excluding personal property coverage and return it to the policyholder. This measure was prompted by the situation many policyholders found themselves in following the August 2016 flood, when they were forced out of their homes and were paying for personal property coverage they no longer needed. The option to exclude personal property from a policy is limited to 24 months from the date of the disaster declaration. A similar consumer protection was enacted by the legislature following Hurricanes Katrina and Rita but it now applies to any parish declared a disaster by the governor or president. Another bill that was part of the LDI package adds vehicle mechanical breakdown insurers (VMBI) to the unfair and deceptive trade practicLouisiana Agent 33
es provision of the insurance code. VMBI licensees were already subject to regulation by the LDI but adding them to the unfair trade practices protections had to be done by statute. So while the department had oversight, we had no enforcement authority. Prior to passage of HB 217, a consumer with a complaint about an unfair trade practice by a VMBI only had the option of going to court. Now they can file a complaint with the LDI which we will handle through the complaint process.
tains a pre-existing condition exclusion.
A measure that was not part of the LDI package but upon which we had significant input was Act 225 regarding travel insurance. With passage of this law, Louisiana becomes the first state to enact the National Conference of Insurance Legislators (NCOIL) Travel Insurance Model Act that was adopted at their spring meeting in New Orleans. The law states that anyone offering or negotiating travel insurance is subject to the unfair trade practices protections. It also gives policyholders a minimum of 10 days from buying a policy to review and cancel it for a full refund – unless the covered trip is already underway or a claim has already been filed. It also requires clear disclosures such as whether a policy con-
Participating in the legislative process is one of the greatest tools that consumers, agents and industry can use to make their needs known. It is my hope that the changes made this session will be to the benefit of all Louisianans. You can find legislative digests on bills in their entirety by logging onto the Legislature’s website at www.legis.la.gov and clicking on bill search in the 2017 Regular Session section. You can also find a PowerPoint recap by visiting www.ldi.la.gov/legislativeupdates.
The Legislature also passed Act 63 which authorizes agency fees on individual and group health insurance policies. As a result of Act 63, agency fees in addition to the premium cost and reimbursement expenses may be charged to a policyholder. These fees must be disclosed on a separate document that is signed by the insured. We will be issuing a bulletin in response to Act 63 to provide guidance on its usage.
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long way in assisting you in booking and retaining business.
Agents and underwriters know who ISO is but many do not know what ISO can do for them and their customers. The following is a recent 50-minute recorded webinar from ISO’s “Monday Web Seminars” series: “Field Survey Services: Emerging Issues, Protection and Challenges” Aside from its policy form and statistical agent functions, “ISO” provides P&C inspection services for loss control and underwriting purposes. Understanding what goes into ISO’s loss cost and underwriting reports is important in that this information can be used to identify loss exposures and their impact on premiums. Understanding the issues surrounding ISO’s inspection services can go a
This video does an excellent job of explaining the basics of sprinkler systems and pointing out issues that you can address with prospects and customers to ensure that they have the proper coverage and rating. It also includes dozens of photos of hazardous conditions and situations that you can look out for when visiting businesses. In addition to sprinkler and other property issues, the webinar includes liability exposures and discussions of emerging issues that may impact underwriting, coverage, rating, and loss control. There is contact information and a downloadable PDF for future reference or if you have questions about the webinar content or about what services ISO has available and their cost.
Bill Wilson, CPCU, ARM, AIM, AAM Founder & CEO, InsuranceCommentary.com Bill@InsuranceCommentary.com or InsuranceCommentary@outlook.com Com•men•tar•y … an expression of opinions or offering of explanations
William C. Wilson, Jr., CPCU, ARM, AIM, AAM is the founder of InsuranceCommentary.com. He retired from the Independent Insurance Agents & Brokers of America in December 2016 where he served as Assoc. VP of Education and Research and was the founder and director of the Big “I” Virtual University for over 17 years. He is the former Director of Education & Technical Affairs for the Insurors of Tennessee and, prior to that time, he was employed by Insurance Services Office, Inc. He is a graduate of the Illinois Institute of Technology with a B.S. degree in Fire Protection & Safety Engineering.
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GOLD LEVEL
SILVER LEVEL
BRONZE LEVEL
BANKERS INSURANCE
CNA INSURANCE
FCCI GROUP
FOREST INSURANCE
GULFSTREAM P&C
HOMEBUILDERS SIF
IROQUOIS SOUTH, INC.
LANE & ASSOCIATES
LUBA WORKERS’ COMP
MAISON INSURANCE
MARKEL FIRST COMP
RPS COVINGTON
SUMMIT CONSULTING
AMERISAFE
EMC INSURANCE EMC INSURANCE
AMERICAS INSURANCE
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IIABL 2016—2017 BOARD OF DIRECTORS & OFFICERS Richard D. Jenkins President Moore & Jenkins Insurance—Franklinton Neil Record President Elect Record Agency, Inc.—Clinton
John L. Beckmann, III Secretary/Treasurer J. Everett Eaves—New Orleans H. Lee Schilling, Jr. National Director Schilling & Reid Insurance—Amite David Dethloff Past President Dethloff & Associates—Shreveport Derek Canchola Young Agent Representative Blumberg & Associates—Baton Rouge Byram H. Carpenter, III Moreman, Moore & Co—Shreveport Brenda Case Lowry-Dunham, Case & Vivien—Slidell Joseph Cunningham, Jr. Cunningham Agency—Natchitoches Donna DiCarlo Riverlands Insurance Services—LaPlace Morris Funderburg Reeves, Coon & Funderburg—Monroe
Ross Henry Henry Insurance Service—Baton Rouge Bret Hughes Hughes Insurance Services—Gonzales Philip McMahon Paul’s Agency—Morgan City Joe King Montgomery Thomas & Farr Agency—Monroe Joseph A. O’Connor, III The O’Connor Insurance Group—Metairie Paul Owen John Hendry Insurance Agency-Zachary Martin Perret Quality Plus—Lafayette David T. Perry Arthur J. Gallagher RMS—Baton Rouge Robert Riviere Riviere Insurance Agency—Thibodaux
Armond Schwing Schwing Insurance Agency—New Iberia Michael D. Scriber Scriber Insurance Services—Ruston Donelson P. Stiel David H. Stiel, Jr. Agency—Franklin
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