February 2014 Wisconsin Independent Agent Magazine by Independent Insurance Agents of Wisconsin

wisconsin

INDEPENDENT AGENT FEBRUARY 2014

115th

ANNUAL CONVENTION MAY 7 & 8, 2014 MARRIOTT MADISON WEST

People who run a business know. The most valuable things

are also the hardest to get.

wisconsin

INDEPENDENT A

INDEPENDENT AGENT

FEBRUARY 2014

Eric Schwartz, Editor

Open Door Policy Growth By Association Annual Convention: Focused On the Future . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Sales Success Becoming The Most Effective Salesperson . . . . . . . . . . . . . . . . 6 News From ACT Small Town Agency, Big Time Success . . . . . . . . . . . . . . . . . . . 8 Commentary From Counsel A Clean Look At The Messy Topic Of Pollution Exclusions . . 12 Focus On Content Why Agencies Need To Content Market Today . . . . . . . . . . . . 15 Errors & Omissions Action! 13 Tips To Prevent E&O Claims . . . . . . . . . . . . . . . . . . 16 Government Affairs Tax Relief Highlighted In State Of The State Address . . . . . 19 Virtual University 2014 Changes In The ISO Homeowners Program . . . . . . . . . . 23

On The Cover…

Growth.By.Association.is.more.than.a. convention.theme.–.it’s.what.we.strive. to.do.every.day..The.focus.on.working. together.for.a.prosperous.future.is.the. goal.that.drives.us..At.this.year’s.115th. annual.convention.we.want.to.celebrate. and.highlight.the.bright.future.that.is. right.in.front.of.us..Matt’s.Open.Door. Policy.article.this.month.previews.the. upcoming.convention.and.an.insert. provides.more.detail.about.the.exciting. event..The.convention.is.May.7.and.8. at.the.Marriott.in.Middleton..It’s.been. a.cold.winter.–.doesn’t.May.sound.good. right.about.now?.Register soon.for.the. annual.convention.at.www.iiaw.com.

Independent Insurance Agents of Wisconsin 725 John Nolen Drive, Madison, Wisconsin 53713 Phone: (608) 256-4429 or (800) 362-7441 ■ Fax: (608) 256-0170 ■ Web: www.iiaw.com

Your customer’s business didn’t grow overnight. It came from years of hard work, confidence in what they could do, and making smart decisions. That’s why an insurance policy from West Bend makes sense. It protects these valuable and hard-earned businesses so your customers can focus on doing what they do best: taking care of children. And with West Bend, it’s backed by your knowledge and experience.

Executive Vice President - Matt Banaszynski 2013-2014 Executive Committee

President-elect ........................................... John Wickhem P.O. Box 1500, Janesville, WI 53547-1500

2013-2014 Committee Chairs

ANNUAL CONVENTION

Secretary-Treasurer ......................................... Steve Leitch P.O. Box 85, River Falls, WI 54022

Agency Operations....................................... Kim Dandrea 1300 South Green Bay Rd. #100, Racine, WI 53406

Chairman of the Board ..................................... Mike Froh P.O. Box 1320, Sheboygan, WI 53082-1320

Automation/Technology ............... Cathleen Christensen P.O. Box 949, Fond du Lac, WI 54936-0949

State National Director ................................ Linda Steiner 555 Main Street #320, Racine, WI 53403

Employee Benefits............................................. Tim Bever 555 Main St. #320, Racine, WI 53403

2013-2014 Board of Directors

Finance & Compensation .............................. Steve Leitch P.O. Box 85, River Falls, WI 54022

Mike Ansay 101 East Grand Ave. #11, Port Washington, WI 53704 Jason Bott 330 East Kilbourn Avenue, Milwaukee, WI 53202

West Bend. Insurance your customers buy when they can’t afford anything less.

115

President....................................................... Dave Dunker P.O. Box 443, Brookfield, WI 53008-0443

Thomas Holter P.O. Box 938, Beloit, WI 53512-0938 Lise Meyer Kobussen P.O. Box 633, Sauk City, WI 53583 Bruce Kommers P.O. Box 66, Antigo, WI 54409-0066 Brian McClone 505 North Westfield Street, Oshkosh, WI 54902 Jeff Rasmussen 525 Junction Road, Madison, WI 53717

MAY 7 & 8, 2014 MARRIOTT MADISON WEST

> OUR ADVERTISERS AAA................................................................. 30 ACUITY.Insurance............................................. 31 Applied.Underwriters.........................Back.Cover Axley.Brynelson.............................................. 25 Badger.Mutual................................................. 28 Burns.&.Wilcox..................................................11 Capital.Remediation........................................ 25 EMC.Insurance.................................................. 13 Guard.Insurance.............................................. 22

Government Affairs .......................................Skip Hansen 100 North Corporate Drive #100 Brookfield, WI 53045

IIAW.Continuing.Education.............................. 29

Industry Relations ............................................. Tom Sitter P.O. Box 2424, Oshkosh, WI 54903-2424

Northern.Underwriting.Managers....................18

Membership Development ................................. Jeff Thiel P.O. Box 1610, Waukesha, WI 53187-1610

Partners.Mutual............................................... 21

Smaller Agencies .................................... Michael Walston P.O. Box 236, Kewaunee, WI 54216-0236 Technical ......................................................Andy Burkart P.O. Box 1320, Sheboygan, WI 53081-1320

Young Agents ............................................ Janelle Higgins 6200 Mineral Point Road, Madison, WI 53705-4504

Pekin.Insurance............................................... 28 Robertson.Ryan............................................... 17 The.IMT.Group..................................................10 Trusted.Choice................................................. 14 West.Bend......................................................... 2

Michael Walston P.O. Box 236, Kewaunee, WI 54216-0236

Western.National.Insurance.............................. 4

Matthew Weimer 100 North Corporate Drive #100, Brookfield, WI 53045

Wilson.Mutual.................................................... 7

WISCONSIN INDEPENDENT AGENT

FEBRUARY 2014 | 3

OPEN DOOR POLICY

GROWTH.BY.ASSOCIATION.ANNUAL.CONVENTION:.. .......................FOCUSED ON THE FUTURE

If.you.have.not.read.McKinsey.&.Company’s.“Agents.of.the.Future:.The.Evolution.of.Property.and.Casualty. Insurance.Distribution,”.I.strongly.encourage.you.to.do.so..As.I.read.the.commentary.both.for.and.against,. I.am.reminded.of.some.advice.my.father.gave.me.when.I.was.younger..

We can help with both. With friendly underwriters who listen, and a full complement of products to serve your small-to-mid-size commercial insurance needs (including enhanced BOP, surety, and packaged coverages), Western National is your one-stop shop for getting business done. The proof is in the partnership.

He said that if you face an adverse situation or a problem, handle it immediately. If you choose to ignore it, the problem could manifest into something much greater. That doesn’t need to happen. At this year’s annual convention, we intend to bring in some of the best, nationally renowned speakers, including the 800-pound gorilla in the room, McKinsey & Company, to provide some valuable insight into the future of our industry and the independent agency channel. Make no mistake about it, independent agencies are facing many challenges and there is no one size fits all approach, but knowledge is power. Every speaker and presenter has been chosen because they are among the best at what they do and can help your agency to continue to grow and move forward. This year’s convention theme of Growth By Association seems fitting. Bob Rusbuldt, president and CEO of the Independent Insurance Agents and Brokers (IIABA), contends that the McKinsey Report misses the mark in a number of areas, but does provide some guidance as to how agencies can re-position themselves for success by integrating many of the recommendations that have emerged from IIABA and the Agents Council on Technology (ACT). Bob will also be part of our 2014 convention. Jeff Yates, Executive Director of ACT says, “McKinsey & Company studies are well read within carrier executive suites and this one raises several issues for carrier executives to be thinking about regarding how they should manage and compensate their distribution force in the future.” After this timely discussion about the future of our industry, John Schlifske, chairman, president and CEO of Northwestern Mutual, will share his views as the keynote speaker during lunch before the exhibit hall. John is a visionary in the life insurance industry whose company has been a leader > Matt Banaszynski is the Executive Vice in recruiting and President of the developing talent, Independent Insurance creating a unique Agents of Wisconsin. product philosophy Contact him at matt@ and in constantly iiaw.com. WISCONSIN INDEPENDENT AGENT

evolving to meet the needs and demands of their customers by integrating technology into their business model. He will share his vision for the industry and his company while providing insights to independent agents on technology and the economy. The following day, Thursday, May 8, we will honor a number of Association volunteers for their hard work and dedication at the Annual Awards Breakfast and Business Meeting. But this year we will be giving out two first-of-its-kind awards for outstanding service to the insurance industry. The E.J. Tapping Award is named after the Association’s first president. Tapping was a true visionary in the industry and helped form our Association in 1899. This distinguished award will be presented to John Bykowski of SECURA and Dave Pauly of Capitol Insurance for their service and dedication to the independent insurance agency distribution channel. Both John and Dave will be on hand to receive this special award and say a few remarks. We hope every agent will join us for this very special occasion honoring two extraordinary men. Following the business meeting, get ready for a fantastic speaker and marketing guru. Kelly McDonald is a nationally recognized marketing expert, with deep specialization in diversity marketing and business trends. She was named #1 on Successful Meetings magazine’s list of “26 Hot Speakers.” She has been featured on CNBC, in BusinessWeek, on CNNMoney.com and on Sirius/XM Radio.

Her clients include Toyota, Harley-Davidson, Sherwin-Williams, State Farm and Miller/Coors. Her company, McDonald Marketing, has twice been named one of the top advertising agencies in the U.S. by Advertising Age magazine. Included in the magazine is a schedule of events for of the 115th annual convention coming up on May 7 and 8. Once again the convention will be held at the Marriott Madison West in Middleton. A detailed brochure will be mailed in mid-February.

FEBRUARY 2014 | 5

SALES SUCCESS

BECOMING THE MOST EFFECTIVE SALESPERSON

One seminar leader opened a workshop for property and casualty insurance agents by asking this question: “Why do people buy insurance?” After the participants offered a variety of responses, he says there’s only one right answer: “To take care of claims.” What seems rather intuitive to most consumers may not be quite so clear to insurance salespeople. How could they miss something that seems so obvious? It’s easy. Insurance salespeople are knowledgeable about analyzing and managing risk. This is their job; it’s what salespeople know. It’s ironic that the strength of knowledge shifts to weakness when they blindly approach solutions from their perspective. But today’s customers want their issues and their interests addressed by salespeople. They want to tell their story and expect salespeople to listen. To be a salesperson today isn’t easy –– in fact, it’s difficult. So, here are six ideas that will help you become a more effective salesperson. 1. Embrace a changing role. A recent Silverpop white paper referred to a study, one that directly affects salespeople: “83% of consumers are willing to spend more on a product or service if they feel a personal connection to the company, while 20% said they would spend up to 50% more if they felt the company put customers first.”

However, this shouldn’t cause anyone to conclude the change diminishes the salesperson’s value. But it does suggest that salespeople now have the task of aligning a company with its customers in ways that result in ever increasing loyalty. Those salespeople who are most successful in accomplishing this objective, a role some call “customer experience facilitator,” deserve to be compensated appropriately for their efforts because of their ability to clearly understand customer needs and expectations. 2. Make ‘now’ the only acceptable response time. When business email recipients are asked who they should respond to first, the most common answer is “the boss.” And it’s downhill from there. Perhaps this explains why so many customer emails fail to receive priority attention or why “I’ll get back to as soon as I can” is insulting. When Boston Business Journal asked Adam Kennedy, 37, the regional property

While this may help explain the near

expect and how they “score” those they do business with. 3. Always think strategically. “It’s absolutely appalling –– and I never use that word –– that there are large, public companies with CEOs who cannot tell what the company’s unique vision and value proposition are,” writes management consultant Steve Tobak of Silicone Valleybased Invisor Consulting. If this is accurate, then is it any wonder that others in companies are focused on what they’re doing, but don’t have a clue as to the mission of the enterprise? Ask someone in sales their mission and chances are they will say, “Make the numbers.” On and on it goes –– no strategy.

6 | FEBRUARY 2014

manager for Peabody Properties, Inc., about his guiding management principles, he put communication at the top. “Response needs to be immediate,” he said. Those few words say it all. “Now” is the only acceptable answer. This is what customers

If there were ever an overlooked truth in selling it’s this: Questions, not presentations, close sales. Why? Customers recognize the value of salespeople who understand what it means to help.

Today, there are so many available buying channels for customers that continuing to engage them is a salesperson’s most important task.

5. Make compelling statements that deliver the right message. Jim Corliss is the owner of Braintree (Mass.) Printing, a successful company that’s long been known as an early adopter of new technology. “Some things work better than others,” says Jim candidly. “But I feel it’s important to be on the leading edge.” When asked about his new 3-D printing capabilities, Jim said, “It’s going slower than I would like, but people need to get a feel for what it can do for them and that takes time.” It takes powerful, compelling messages to put a company “out in front,” to attract customers and to separate it from the competition.

6. Never stop engaging customers. This may seem so basic and obvious it’s not worth taking time to talk about it. Perhaps, but the evidence suggests otherwise. In effect, most companies don’t make engaging customers an ongoing activity; stupidly, they actively promote “antiloyalty.” Customers conclude, “I’m not important to them.” Customers are amazed that so few salespeople ever bother to follow up after a sale, let alone as time goes by. When auto dealers fail to stay in touch with car buyers more than a few months or maybe a year, the customers fall off the database cliff, which then gives them “permission” to shop elsewhere the next time around. If salespeople want loyalty from customers,

they must demonstrate loyalty as well. Today, there are so many available buying channels for customers that continuing to engage them is a salesperson’s most important task.

> John Graham of GrahamComm is a marketing and sales consultant and business writer. He publishes a free monthly eBulletin, “No Nonsense Marketing & Sales.” Contact him at johnrg31@ me.com, 617-774-9759, or johnrgraham.com

“Tell me what your business was born to change?” asks Christoph Becker, Global CEO of Gyro. “Who are the people? What is their dream? How is your business set to change the world?” He notes that this is what it takes to make a brand relevant to people.

83% of consumers are willing to spend more on a product or service if they feel a personal connection to the company, while 20% said they would spend up to 50% more if they felt the company put customers first. fanatical customer loyalty enjoyed by such companies as Amazon, Apple and others, it also calls into question the traditional and cherished role of salespeople as intermediaries operating between a company and its customers.

realized that we had been going in the wrong direction.”

4. Don’t jump to a solution before understanding the need. Sending customers the message that your goal is “making the sale” rather than “helping to solve a problem” is the most common mistake in sales. Today’s customers don’t want any part of “being sold.” What they’re looking for is help. Those salespeople who don’t understand the difference are headed for trouble.

The path to the right solution starts with asking questions –– taking time to ask lots of questions. “At first it bothered us that she was asking so many questions,” said the manager regarding a meeting with a salesperson. “It was irritating because we knew what we wanted.” Then, with a sheepish smile, he added, “It didn’t take long before we WISCONSIN INDEPENDENT AGENT

PLACED PLACED WISCONSIN INDEPENDENT AGENT

FEBRUARY 2014 | 7

NEWS FROM ACT

SMALL TOWN AGENCY. BIG TIME SUCCESS.

effectively,” he explains. “We get reports that indicate what’s working in social media and our other digital marketing activities. This data and information I get through Best Practices provide a good road map going forward.” An important part of the Astonish offering is customer relationship management software, dubbed the Virtual Profit Center, which drives much of the agency’s electronic marketing and sales work. “Every personal or commercial lead, whether it comes in through the website or a phone call or in person, gets entered into this database, which integrates with our AMS360 system,” Hilton explains.

Dennis Hilton grew up at Cheney Insurance, spending time with his parents in the office as a youngster and joining the family business when he graduated high school. Today, the agency employs more than a dozen people and serves businesses and individuals throughout his region of coastal Maine and beyond. The agency mix is 60% personal lines and 40% commercial, which includes a special program for outdoor guides. “We like to think that we insure more Maine guides than any other agency,” notes Hilton, who now is president and sole owner of the company. A few years ago, a trifecta of events led to changes that helped move the Damariscottabased business to a new level. “We had a confluence of opportunities come together in 2010 that has helped drive agency growth in ways I’d never imagined,” says Hilton, a past member of IIABA’s National Young Agents Committee, Best Practices Committee and Planning Committee. In February, he says, the agency joined a regional alliance of like-minded firms. In April, they signed on with Astonish Results, an insurance-focused digital marketing and training firm. Finally, at year end, Hilton bought the agency from his parents.

Agency Alliance “The alliance — the North American Insurance Alliance — is like a cluster,” Hilton explains, but we try to avoid using that term. “It’s a group of more than two dozen New England agencies that joined forces and combine premium volumes to gain leverage with insurance companies.” Cheney was the group’s first member. Hilton says the alliance is somewhat unique. “We work to develop two-way partnerships with carriers, making growth commitments

8 | FEBRUARY 2014

in exchange for incentives,” he explains. “It’s working really well.” Hilton says in just a few years, the alliance has grown to more than $200 million in aggregated volume. The arrangement offers more than leverage and incentives. “Our agency is gaining a lot beyond the financial aspects of the relationship,” he explains. “I share with other owners and my staff interacts with their peers at other agencies. We get great ideas and have been able to build our expertise and increase our effectiveness as a result of our participation.” Agencies get together in-person from time to time. “We recently had a meeting oriented to commercial lines, so we brought together all of the commercial lines staff from each of the member agencies to share ideas,” he explains. “Everybody left energized and ready to implement new strategies and techniques they’d picked up.” Alliance benefits allow Hilton to focus more on growing his business, too. “For some time, I spent a lot of time trying to track volumes and progress in meeting insurance company production goals — trying to read and decipher production reports from multiple carriers,” he explains. “Craig Sargent, who heads the Alliance, now does all that for us. He keeps me updated and offers guidance so I can concentrate on other management responsibilities.”

Digital Marketing & Sales Signing on with Astonish Results helped bolster

the agency’s digital marketing presence and strengthen its client relationships. “Prior to Astonish, we were just like most other agencies; we were order takers,” Hilton recalls. “We did fairly routine types of attempts at cross-selling, account rounding and upselling, but our efforts were weak. Working with Astonish helped us fine tune that.” The entire staff is engaged in the sales process. “Even the receptionist, our processors and accounting folks are included,” he notes. “Of course, agents have a defined sales role and responsibility, but boosting sales awareness throughout the agency has been an important part of our transformation. Everybody has a much greater sales awareness and focus than before.” Astonish helped Hilton understand the importance of social network engagement. “We’ve worked hard to build our audiences and influence on the various social platforms,” Hilton notes. “We hired a social media coordinator, but the initiative is broader than just one person; all of our employees help promote what we’re doing. “Rather than be an agency owner who worries about staff being on Facebook during company time,” he adds, “I want them out there. They understand the ins and the outs, what we are doing to attract new audiences, and why.” The social media coordinator drives social engagement and manages agency blogs. “We are doing a good job of leveraging social media WISCONSIN INDEPENDENT AGENT

The integration makes it easy for staff to track and follow prospect and client activity. “It helps everyone see where they are in the sales process,” he adds. “In addition, the system supports producer activity with targeted emails based on where leads are in the sales cycle.” To help drive success through the

to implement transactional filing. Eight years ago, we eliminated paper client files altogether.” Hilton says his parents long encouraged him to seek out efficiency gains and implement needed changes. “My parents have always been very supportive,” Hilton notes. “They recognized the importance of staying current and adapting to market changes.”

Building a Brand A key element of the agency’s transition was its presentation to the public. “Astonish provided us not only a strong, interactive website, but they helped us better understand today’s insurance buyer and how to position ourselves by incorporating website features that help people connect with us,” he says. “Our employees have done a great job learning more about what makes an

Addressing Results To help drive staff performance, the agency holds weekly meetings in its media room. “We can display information from iPads, the media room computer, a guest laptop or even DIRECTV or Netflix. It’s great for training, client interaction and staff meetings,” explains Hilton. The Tuesday morning meetings address sales activities and a variety of other metrics. “We look at everything from how many phone calls and walk-in visitors we handled the previous week to how many new email addresses we collected and how many policies were sold or lost — and why,” he notes. “Every person in the company takes part.” Management releases support staff following the metrics discussion and a short videotraining segment, and the agents drill down on lead reviews. Besides weekly meetings, employees gather in a group most mornings — standing in the

Of course, agents have a defined sales role and responsibility, but boosting sales awareness throughout the agency has been an important part of its transformation. Everybody has a much greater sales awareness and focus than before.

system, agency employees have collected email addresses for some 80% of the firm’s nearly 5,000 customers.

Full Ownership Purchasing the agency was, in some ways, monumental; in other ways, not so much. “I’ve been part of the agency for nearly 30 years,” Hilton explains, “and during that time, I assumed increasing responsibility. My parents got me involved in leadership early on.” So when Hilton signed the paperwork to make him 100% owner at the end of the year, not a lot changed. “I was basically gaining ownership of a business that I had helped grow along the way,” he adds. He also had helped drive change over that time. “We try to leverage the technology to our benefit as much as we possibly can,” Hilton notes. “Twenty-plus years ago, we were among the first agencies in our area WISCONSIN INDEPENDENT AGENT

insurance agency brand strong and then implementing those things,” Hilton adds. “From how we answer the phone, to how we interact with each other and maintain a fun work environment, to how we use technology to support what we do – everyone has pulled together. To help reinforce the agency’s brand, it developed what Hilton calls “Talk Tracks.” “Every person in the office has 60 or so cards, all on a ring, addressing potential sales objections and various agency-related topics,” he explains. “The cards provide answers that help increase sales and build employee understanding, allowing them to speak confidently — and consistently — about Cheney Insurance, how we operate, what we offer and how we do it.” Questions range from “Why should I do business with you?” and “What is an independent insurance agency?” to “Should I drop collision insurance?” and “Do you guys give to charity?”

reception area — and each shares something positive that happened the previous day. “It puts us in a positive mood and sets the stage for another day,” Hilton explains. “Plus, it lets us learn something new about each person every day; we make another connection and bond more as a group.”

Improving Processes Agency management taps other tools to drive improvement. “We use technology that Astonish provides to listen to recorded phone calls,” Hilton explains. Each time a call comes in on the Astonish phone line, it is recorded, and when the call terminates, Hilton and his human resources/marketing manager get an email with the recording attached. “We listen to them and choose two or three we send into the media room to share with the staff,” he explains. “Nobody knows, when they get a phone call whether it came in CONTINUED ON FOLLOWING PAGE

FEBRUARY 2014 | 9

NEWS FROM ACT

SMALL TOWN AGENCY. BIG TIME SUCCESS. CONTINUED FROM PREVIOUS PAGE

through the Astonish number, in which case it’s recorded, or direct, so everybody is on their toes every time.”

development days — much like in-service teacher training days — to bolster employee performance.

Initial reaction to recording calls was mixed. “Some people were uncomfortable hearing their own voices, especially in problematic phone calls,” Hilton recalls. “But we’ve worked together and everyone’s on board. Now, it would seem strange to not listen to calls.”

Bright Future

“If we hear an employee asking for an email address or a cross-sell or something else we’re targeting, they are invited to go to the wall and pick an envelope,” he adds. “Everybody is engaged and it’s become a very important part of our overall strategy.” In addition to ongoing call-based and other training, the agency holds twice-a-year staff

Hilton is enthusiastic about the agency’s progress and prospects. “The work we’ve done helped us get a better handle on our operations and positioned us for great things ahead,” he explains. “Prior to three years ago, I probably could tell you where my real great performers were and where the other folks might have been. But now, we all see it together with our own eyes. It helped us build a stronger agency-wide sales culture and zero in on what’s most important.” The agency is leveraging these successes and is broadening its focus. “We started growing a benefits division last year,” Hilton notes.

“That’s an area where we’ve been somewhat deficient, but we recently acquired a nice book of life and health insurance accounts and now we have a more solid foundation on which to build. We now write business throughout the state of Maine, and that has been another factor in our evolution. It’s allowed us to hire some great people. We’re constantly trying to attract new talent – star > Dave Willis, senior performers who can associate with the help us as we grow.” insurance-focused

Besides weekly meetings, employees gather in a group most mornings — standing in the reception area — and each shares something positive that happened the previous day.

Your gateway to contractors markets.

communications firm Aartrijk, interviewed Dennis Hilton and authored this article for ACT. Dave can be reached at dave@ aartrijk.com. This article reflects the views of the interviewee and should not be construed as an official statement by ACT.

CONTRACTORS SOLUTIONS

Placing insurance for different contractors can be a daunting project. At Burns & Wilcox, our network of domestic and international carriers opens doors to the broadest range of markets. Since time is of the essence, we deliver quotes and binders fast. When it comes to finding solutions for every stage of construction, contact the wholesale broker with the tools to make the hard-to-place easy – Burns & Wilcox. Milwaukee, Wisconsin | 262.347.0266 | toll free 800.544.5700 fax 262.347.0440 | milwaukee.burnsandwilcox.com Minneapolis, Minnesota | 612.564.1880 | toll free 800.328.1693 fax 612.564.1881 | minneapolis.burnsandwilcox.com 10 | FEBRUARY 2014

WISCONSIN INDEPENDENT AGENT

COMMENTARY FROM COUNSEL

A Clean Look At The Messy Topic Of Pollution Exclusions

Three recent decisions, one from the Wisconsin Supreme Court and two from the Court of Appeals of Wisconsin, address the scope of the pollution exclusion contained in most liability insurance policies, but do not necessarily add a great deal of clarity. The trilogy of cases, if the latter two make it to the Supreme Court, will no doubt take on a clever nickname, since their subject matter is, well, messy. For now, it seems there is no consensus regarding interpretation of common contract terms including “pollutant” “waste,” “contaminate,” and “irritant.” The three are worth taking a look at (and, if you want to take a crack at naming the trilogy, feel free to email the IIAW hotline!).

Bat Guano In 2012 the Wisconsin Supreme Court addressed the applicability of the Pollutant Exemption in a homeowners policy to bat “guano” in Hirschhorn v. Auto-Owners Ins. Co. 2012 WI 20, 338 Wis.2d 761, 809 N.W.2d 529 (2012). The plaintiffs in Hirschhorn owned a vacation home in Lake Tomahawk, Wisconsin. When they put the home up for sale in 2007, they discovered bat guano in between the home’s siding and the walls and, despite attempts to rid the home of the bats and the guano, there was “a penetrating and offensive odor” emanating from the home. After cleaning attempts failed, the owners were left with no choice but to demolish the home. The home was insured by Auto-Owners Insurance Company under a policy which excluded from coverage any “loss resulting direct or indirectly from: … discharge, release, escape, seepage, migration or dispersal of pollutants.” The policy further defined “pollutant” as “any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals, liquids, gases and waste.” Waste included materials to be recycled, reconditioned or reclaimed. After demolition, the owners filed a notice of property loss, and Auto-Owners denied the claim based on the policy’s maintenance exclusion clause. Later, Auto-Owners revised their claim denial on the additional ground that bat guano is a “pollutant” within the terms of the policy’s pollution exclusion clause. The circuit court initially denied Auto-Owners’ motion for summary judgment, holding that bat guano accumulation is unlike “traditional pollution” that is contemplated by the exclusion. However, upon reconsideration, the circuit court excluded coverage, deciding that bat guano qualified as a “pollutant” as

12 | FEBRUARY 2014

the odor “seeped or … disbursed throughout the residence to cause the loss.” The court of appeals reversed, equating bat guano to exhaled carbon dioxide, explaining that a reasonable insured might interpret the term “pollutant” as to not include bat guano. The Supreme Court attempted to reconcile this case with its previous Pollutant Exclusion cases, defining “irritant” and “contaminant” by reference to the court’s previous decisions, where it had: concluded that under the plain language of the policy, “[t]he terms ‘irritant’ and ‘contaminant,’ when viewed in isolation are virtually boundless” and, thus, “[t]he reach of the pollution exclusion clause must be circumscribed by reasonableness”; but also, in a separate case, determined “that the ordinary meaning of ‘contaminant’ is ‘one that contaminates’ or ‘make[s] impure or unclean by contact or mixture.” Relying on these prior decisions, the Hirschhorn court reversed the court of appeals and held bat guano “[fell] unambiguously within the term ‘pollutant’ as defined by the…insurance policy” because: (1) “bat guano and its attendant odor indeed ‘make impure or unclean’ the surrounding ground and air space” and can cause “inflammation, soreness or irritability”, making it an “irritant” or “contaminant”; and (2) “waste” unambiguously includes bat guano because a reasonable person in the position of the insured would understand bat guano to be waste.”

Cow Manure In December 2013 the Wisconsin Court of Appeals had its first opportunity to apply Hirschhorn when the court addressed the pollution exclusion’s applicability to cow manure used as fertilizer on a farm. In Wilson Mut. Ins. Co. v. Falk, 2013 WL 6480760, ¶ 4 (Ct. App. Wis. Dec. 11, 2013), the plaintiffs owned and operated a dairy farm including over 600 cattle and 1670 acres of land. The Falks obtained a “farm” insurance policy from Wilson Mutual to provide property and personal liability coverage and it included a pollution exclusion that exempted from coverage losses resulting from the “discharge, dispersal, seepage, migration, release, or escape of ‘pollutants’ into or upon land, water or

air” and “any loss, cost, or expense arising out of any … claim or suit by or on behalf of any governmental authority related to testing for, … cleaning up, removing … or in any way responding to or assessing the effects of ‘pollutants.’” “Pollutant” was defined in the policy as “any solid, liquid, gaseous … irritant or contaminant, including … waste. Waste includes materials to be recycled, reclaimed, or reconditioned, as well as disposed of.” In early 2011 the Falks used manure to fertilize their fields, however, in May 2011, the Wisconsin DNR notified them that “the manure from [their] farm had polluted the a local aquifer and contaminated their neighbors’ water well.” The neighbors demanded compensation and the Falks notified Wilson Mutual of the claims and a coverage battle ensued. The circuit court denied coverage for any damage arising from the water contamination, finding that “[a] reasonable person in the position of the Falks would understand cow manure to be waste.” The court of appeals, relying on the Supreme Court’s decision in Hirschhorn, reached the opposite conclusion, determining that, according to the policy’s plain and ordinary meaning as understood by a reasonable insured – namely a reasonable farmer – cow manure is not a “pollutant” under the policy exclusion. According to the appellate court, a reasonable farmer would not consider cow manure to be a “pollutant,” an “irritant,” a “contaminant,” or “waste” as defined in the policy because, for a farmer, “manure is an everyday, expected substance…that is not rendered a pollutant under the policy merely because it may become harmful in abnormally high concentrations or under unusual circumstances.”

Septage Wisconsin’s trend toward interpreting insurance contracts’ Pollutant Exclusions from the view of a reasonable policyholder took a sharp turn in the Wisconsin Court of Appeals’ recent decision Preisler v. Kuettel’s Septic Service, LLC, 2014 WL 114325 (Ct. App. Wis. Jan. 14, 2014).

feces, and chemicals – is a “pollutant” under an insurance policy’s Pollutant Exclusion. The plaintiffs operate a dairy farm, while the defendants lived across the street and operated their own farm as well as a septic service operation. In addition to storing, transporting, and disposing of septage, the defendants received permission from the Wisconsin DNR to apply septage as fertilizer at a rate not to exceed 13,000 gallons per acre per week, with a total of 39,000 gallons per acre permitted annually. At some point the parties discussed spreading septage on Preislers’ farm as fertilizer. Beginning in 2008, they began experiencing problems. A large algae bloom appeared in their pool, which had been filed with well water, and their cattle began to die at an uncharacteristically high rate. Testing in August 2008 discovered high levels of nitrogen in the soil. Upon drilling a new well, conditions on the Preisler’s farm returned to normal. In 2010 the Preislers filed suit against Kuettel’s Septic for losses resulting from the death of their cattle. Kuettel’s Septic was insured for such losses, and the corresponding insurance companies were later added. Each insurance policy at issue included a similarly worded exclusion for pollution. All policies

The circuit court ruled in the insurers’ favor, relying upon Hirschhorn, and finding that septage was “unambiguously ‘waste’ and therefore a pollutant.” Moreover, the Preisler’s losses “resulted from the ‘discharge, release, escape, seepage, migration or dispersal’ of the septage.” The court of appeals’ analysis begins just like the previous decisions in Hirschhorn, and Falk – by defining the policy terms “pollutant,” “irritant,” and “contaminant” and determined under “their common, ordinary meaning” a “‘contaminant’ is something that makes something else ‘impure or unclean by contact or mixture.’” Further, an “irritant” is “’the source of irritation, especially physical irritation.’” Under this framework, the appellate court concluded, “septage is plainly a contaminant and irritant.” First, the court determined that septage, composed of waste

materials stored in septic tanks, grease traps, floor pits, and catch basins, are “widely considered undesirable precisely because they cause impurity and uncleanliness.” In reaching its conclusion, the appellate court made a notable departure from recent jurisprudence that spurs the return of uncertainty in Pollution Exclusion cases: relying on much earlier (1980s) court of appeals precedent, the court flatly rejected the reasonable expectation analysis endorsed by Hirschhorn and Falk.

Now What? These three decisions taken together do not add a great deal of clarity to the interpretation of the Pollutant Exclusion, especially when it comes to various forms of animal and human waste. It is possible — indeed likely — that the losing parties in Falk and Preisler will petition the Wisconsin Supreme Court for review. Whether the state’s highest court will take on either or both and > Josh Johanningmeier synchronize them with is the IIAW’s General Hirschhorn remains to Counsel. Call the Legal be seen. Services Hotline at (877) 236-1669.

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In Preisler, the court of appeals examined whether septage – a combination of urine, WISCONSIN INDEPENDENT AGENT

excluded “damage cause by the actual, alleged, or threatened discharge, dispersal, seepage, migration, release, or escape of pollutants.” And, each policy defined “a pollutant as any solid, liquid, gaseous, or thermal irritant or contaminant” and gave examples of pollutants, including “smoke, vapor, soot, fumes, acids, alkalis, chemicals, and waste.” Waste included “materials to be recycled, reconditioned, or reclaimed.”

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FEBRUARY 2014 | 13

FOCUS ON CONTENT

WHY INSURANCE AGENCIES NEED TO CONTENT MARKET STARTING TODAY In the last year or so, four seismic marketing events occurred that will forever reshape how insurance agencies develop new business and sustain it. There’s no secret to event number one; it’s Google’s highly publicized reformulation of their secret algorithm, which I have written about extensively. The second event was a new study from Cornell University about the importance of search rank, and how businesses search other businesses, and how consumers search companies. The third occurrence was the release of a report from the Nielsen Norman Group that pretty much threw any long-winded, rambling web writers off the cliff. And finally, a new article in Forbes Magazine titled The 2014 Content Marketing Imperative that brought content marketing to the forefront by extolling what most of us had known for years.

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If these four occurrences don’t provide the impetus to fuel your content marketing strategies, than I suppose nothing will. This is the way insurance agencies need to bring their products and services to market, and because of the nature of these seismic events, agencies are left with few, if any, alternatives. Now, let me explain. As you undoubtedly know by now, Google upped the percentage of relevancy by which content plays a role in your search ranking. In part, they did this to eliminate web spam, which is non-relevant content; but at the same time, they did it to reward businesses, insurance agencies included, who populate their websites with fresh, engaging content on a consistent basis. A significant wrinkle within the algorithm is that fresh content means original content – no longer does canned content qualify as original content. In short, if you want to be rewarded by Google, update your website’s content weekly, if you don’t, Google will penalize you with a descending search rank.

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But why is search rank so important? Here’s where the report from Cornell University helps us understand how people use Google, and for insurance agencies, it’s downright frightening. For starters, more than 90 percent of all organic website traffic comes from sites that appear on page one of a search engine results page (SERP). Consequently,

on the first page of search, you’re basically out-of-sight and out-of-mind. But here’s where it gets mind-boggling. Fifty six percent of web users never make it past the top three listings on Google’s first page. So why is

We know that Google rewards original and frequent content. We also know that you must be on the first page of search, for any search engine, and content is one of the only ways to get there. That’s why Forbes Magazine has chosen to write extensively about content marketing. Organizations like the Content Marketing Institute and TMA+Peritus, the company I work for, have steadfastly promoted content marketing since the turn of the century. But now Forbes has brought it mainstream by citing the statistics that we’ve been citing for that last few years.

content marketing so important? Because content is one of the only ways to be on page one without paying for it. But creating content is only part of the equation. As everyone knows, content needs to be engaging, customer and prospectcentric, and it should tell a story whenever possible; that’s the price of admission to content marketing. But what should content look like on a web page so your site is more “sticky”, so people return time and again, so your bounce rates are low, and Google recognizes all of this activity? In the Nielsen Norman Group research, we learn that web visitors to your site only read 28% of what’s

Fifty six percent of web users never make it past the top three listings on Google’s first page. more than 90 percent of the content consumed, and you need to be part of that 90%, comes from page one. So, if you’re not WISCONSIN INDEPENDENT AGENT

people lose interest, and at the 400-word mark, you’re all but toast. So start editing, or as we say in the copywriting business, “it’s time to kill your darlings.”

on your page. Ouch. Make adjustments accordingly. We also learn that at the 250word count, using eye-movement technology,

a 60% of buyers have their minds made up before you even know who they are, so get your website and your content in shape as quickly as possible. a Content marketing costs 62% less than traditional promotional activities and generates 3 times as many leads. a The website conversion and qualified lead conversion rates for brands using content marketing is 6 to 7 times higher. Need more reasons to implement your content marketing strategies in 2014? Here’s one more – almost everyone, regardless of agency size, is going to be doing it. Watch for my next article available soon: My 2014 Content Marketing Predictions for Insurance Agencies.

> Thomas Marks is president and managing partner of TMA+Peritus. Prior to starting the agency in 1983, Tom was the VP of marketing and advertising for Bally Corporation in Chicago. He was also president of Bally’s multi-million dollar in-house ad agency FFC Advertising.

FEBRUARY 2014 | 15

ERRORS & OMISSIONS should contact the agency for changes to their insurance needs? Is coverage that may have been offered during the new business process being offered at renewal?

ACTION! 13 TIPS TO PREVENT E&O CLAIMS Implementing E&O risk management into the agency can be overwhelming. Agency staff is busy servicing customers and trying to grow the agency. The good news is that an agency with good E&O procedures in place is also more likely to be more profitable.

Below is a list of 13 steps the agency can implement to help reduce E&O exposure. They don’t need be implemented all at once. To keep from getting overwhelmed consider implementing one per month. 1. Assess Customer Needs. Understanding your customers’ operations can help agency staff uncover areas of exposure. To do this, agents need to know the right questions to ask. Risk assessment questionnaires can guide producers in their conversations with customers and E&O coverage checklists can document coverage that is offered. Whether state law prescribes a legal duty to assess customer exposures and offer coverage, covering exposures that could later lead to an uncovered claim is the most proactive thing agencies can do from an E&O risk management standpoint. For an annual subscription of $250, the Big “I” Virtual Risk Consultant offers descriptions for operations of hundreds of businesses, risk assessment questionnaires and E&O coverage checklists. It will make agency staff better at what they do and in the end increase agency revenue. 2. Offer Coverage. When it comes to E&O claims against agents, it’s always interesting to hear testimony from customers saying they would have bought the coverage if only it was offered to them. Yeah, right! Customers come to the agency with an idea of the type and amount of insurance they need and are looking for the best price. Even if it seems like a bother to the customer, don’t be afraid to discuss other exposures they may have and provide quotes for additional coverage. Producers

16 | FEBRUARY 2014

5. Review/Audit Customer Files. You’ve heard it in E&O seminars that the three most important things an agency can do is “document, document, document”. Good documentation in customer files is tremendously important, but does your agency have it? Make it a routine to periodically pull some customer files to check if they have the level of documentation that would help defend the agency should an E&O claim occur. Consider a peer review process. Make it an exercise of continuous improvement, not one targeted at catching employee mistakes. This type of process will keep good documentation at the forefront of the minds of agency staff.

should keep these couple things in mind: a It’s the agent’s job (although not necessarily legal duty) to offer coverage to protect the customer’s assets; it’s the customer’s job to make the buying decision. aOffering coverage and documenting rejections protects the agency even if the customer doesn’t purchase them. 3. Offer Increased Limits. It’s the customers’ responsibility to determine insurable values and preferred limits. However, why not include increased limits with every quote? E&O claims often stem from inadequate limits so higher limits can be the difference between a covered and uncovered claim. Another proactive risk management approach is to make

6. Stay Current On Coverage. Insurance coverage is complicated and it is constantly changing. In 2012, ISO introduced changes to the commercial property form while 2013 brought changes to the CGL form. Agency staff needs to stay abreast of changes in coverage and educate customers accordingly. The investment in educating agency staff will pay huge dividends in writing more coverage and reducing E&O exposure. Set up education paths for all agency employees and keep in mind that continuing education requirements should be looked at as minimum standards. 7. Create A Culture. E&O risk management is not something that the agency staff should turn off and on. It needs to be a culture that permeates agency staff year

A simple line of defense against E&O claims is incorporating disclaimer

is involved in an E&O claim the better the chances of a positive outcome. While your first instinct may be to try and make the claim go away, this is the wrong approach. On average, 1 in 7 agencies will report an E&O claim but 50% of claims are closed with no defense or indemnity payments. E&O claims are going to happen but focus on getting your E&O carrier involved early.

sure customers understand the valuation methods and any coinsurance limitations. 4. Don’t Renew As-Is. Agents work so hard to attract new customers. But once the customer is written there is danger in putting their renewal on autopilot. Customer exposures change over time and so do their coverage needs. How often is agency staff working with renewals to assess their exposures? Is there at least an annual letter emphasizing that the customer

round. Hold staff meetings about the importance of E&O risk management, share articles, periodically audit files, and make it part of the employee performance review discussion. Frequently asking employees if they are aware of situations that could potentially give rise to future claims also keeps the subject front and center. But it is only possible with a culture of awareness. 8. Don’t Be Afraid To Report Potential E&O Claims. The earlier your E&O carrier WISCONSIN INDEPENDENT AGENT

11. Value Or Limits. Re-evaluate how your agency handles the determination of insurable values and limits for customers.

subject to many of the same regulations that the agency is. Learn how it applies to the agency and then parlay that into selling coverage to your customers. Visit www. bigimarkets.com if you are in need of access to some cyber liability markets. 13. Attend An E&O Class. Good things come to those that attend an E&O seminar

9. Handle Customer Claims Expeditiously. It is astounding how many E&O claims Agents have a legal obligation to protect customer data. Start by involve agents failing to handle customer educating yourself on the applicable state and federal laws. claims properly. The common error is failing to forward the claim to the carrier in a timely basis. When claims are taken and not sponsored by the Independent Insurance delivered to the carrier the same day with Inadequate limits or values are common Agents of Wisconsin. Data shows that appropriate follow-ups set in the agency allegations made against agents when those agencies that attend classes are management system, the agency not only customers experience a loss that is much less likely to have an E&O claim. insufficiently covered. Be sure to clearly state puts itself in jeopardy of an E&O claim, but Agents can also get discounts on their E&O that values and limits are determined by also of losing its reputation with customers. premium and earn CE credits. In addition, the customer. When agency staff specifies Customers pay premiums for the moment attending seminars will help you achieve the limits a customer should procure their when a claim happens and, when it is not and implement all of the suggested risk standard of care can be increased to assure handled appropriately, frustration can set management items listed above. the limits are adequate. When using cost in as to why they purchased coverage in the estimators provide a disclaimer that this is first place. Make sure customers understand Implementing any of the above steps just an estimate and the cost to rebuild or their responsibilities in the event of claims can help any agency reduce exposure to replace could exceed the limits. Make sure and execute on()*234!,-#%./+!0++1234!5)-0+,6!#-!;#%/=!$#%!/20+!)99+66!,#!5)3$!5#-+!5)-0+,67! the agency’s responsibilities ,@+!)36;+-!26!A#.+-,6#3!A$)3 E&O claims and the customer is accounting for upgrades and as well. Agencies should never make improve customer explain that purchase price and appraisals coverage determinations, as that is the role BC!$#%!)6!#;3+-!;)3,!,#!61+3=!/+66!>5+!#3!)=52326,-)>#3!.%,!9#3>3%+!,#!#;3!,@+! service. If you feel are different than the actual cost to rebuild of carriers. Agency staff should report the .##0<!,@+!)36;+-!26!A#.+-,6#3!A$)3 overwhelmed by under specific circumstances. claim in a timely fashion to ALL carriers the list, pick the low where coverageBC!$#%!)6!#;3+-!;)3,!,#!6+//!$#%-!)4+39$<!,@+!)36;+-!26!A#.+-,6#3!A$)3 may be applicable, including hanging fruit such 12. Protect Customer Data. This is a excess and umbrella carriers. BC!$#%!;)3,!5#-+!9#3626,+39$!23!+)-32346<!239/%=234!1-#?,!6@)-234<!,@+!)36;+-!26! as sending all staff complicated issue but it’s time for agents A#.+-,6#3!A$)3 to an E&O seminar to stop burying their heads in the sand. 10. Incorporate Disclaimers. A simple or pulling a couple Agents have a legal obligation to protect line of defense against E&O claims is customer files every customer data. Start by educating yourself incorporating disclaimer language in the so often to review on the applicable state and federal laws. agency’s operations. There are different ! language that can be > David Hulcher documentation. The E&O Happens website and the IIABA’s types of disclaimer is Assistant Vice D#!?3=!#%,!5#-+!,#=)$<!9)//!E)-$!F%-,#3<!G@2+C!H1+-)>34!HI9+-<!),!JKJLMMKLNOPQ used in voice mails that include messages ACT website (www.iiaba.net/act) have President, Agency that coverage cannot be bound or changed information to help you understand agency Professional Liability without speaking to a licensed agent or exposures. Keep in mind that your customers Risk Management, that the insured should read their policy. have cyber liability exposure and are also at the IIABA.

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language in the agency’s operations. Sample disclaimer language can be found on the E&O Happens website at www.iiaba.net/eohappens.

Sample disclaimer language can be found on the E&O Happens website (www.iiaba.net/ eohappens). Disclaimers are helpful in the defense of an E&O claim and can reinforce information customers need to be aware of.

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ROBERTSON RYAN & ASSOCIATES, INC.

GOVERNMENT AFFAIRS

TAX RELIEF HIGHLIGHTED . IN STATE OF THE STATE ADDRESS

Several months ago, I inadvertently overpaid my U.S. Cellular phone bill without knowing it. Fortunately, the company discovered this and returned the overpaid amount to me. In a nutshell, that is what Wisconsin Governor Scott Walker has proposed to do with a projected $912 million budget surplus.

Governor Walker delivered his fourth annual State of the State address to a joint session of the Wisconsin legislature on January 22, 2014. The hour-long speech, dubbed a “Blueprint for Prosperity,” was by far his longest and most optimistic of his first term. The governor seized the opportunity to detail his vision on what to do with the unexpected budget surplus.

they will likely act on it as the first bill the chamber takes up when they reconvene on February 11. The GOP-controlled Assembly is dominated by fiscal conservatives and the bulk of Governor Walker’s plan appears to have their support and is expected to remain intact.

However, the Senate may not be as quick to approve the governor’s plan in its Just three short years ago, Wisconsin entirety because several Republican senators faced an ominous $3.6 billion dollar of the 18 that make up the senate have budget shortfall, expressed their a weakening preference to economy, and use part of the unpaid bills budget surplus coming due. It was to pay down a rather gloomy the structural fiscal picture when deficit. Governor Walker This deficit first took office. currently Today, Wisconsin is stands at realizing a budget $708 million surplus that is a and is the direct result of amount that an improving expenditures economy and, are expected During his State of the State address on January 22, Governor Scott arguably, because Walker proposed a property tax reduction of more than $406 million. to exceed of more responsible revenues by fiscal management of your tax dollars. mid-2017. But many Republican lawmakers While Washington, D.C. continues to argue that a continuation of a strong bury people and businesses with more economy spurred by tax cuts would further burdensome regulations, taxes, and stimulate the state’s economic condition and expensive government programs, here in eliminate any structural deficit that exists Wisconsin the fiscal condition has improved today. dramatically. Governor Walker has rightfully prioritized giving back the bulk of the One way or another, more tax relief is on budget surplus to the people that earned it the way. In mid-February just in time for in the first place – the taxpayers. our Day on the Hill, a healthy and vigorous debate inside the legislature on how best to Governor Walker’s plan delivers this tax return your hard-earned tax dollars will be relief primarily in the form of property and at the forefront when you visit Madison. But income tax reductions. He has aggressively despite these differences that exist between called for a special session of the legislature the Senate and Assembly today, the good to act on his plan before they adjourn in news is that this debate will be over how April so that people can see reductions in best to return the bulk of your tax dollars, their tax liability yet this year. rather than on how the state government can spend it. Republican Speaker Robin Vos (R-Burlington) has already indicated publicly Here are some of the major highlights of that there is strong support among Assembly Governor Walker’s Blueprint for Prosperity Republicans for the governor’s plan and plan: WISCONSIN INDEPENDENT AGENT

• Return $800 million back to taxpayers through property and income tax cuts and withholding changes. • Reduce property taxes by over $406 million. A typical homeowner will see a reduction of $101 dollars on their next property tax bill in 2014 compared to the previous year. • Reduce income taxes by nearly $100 million — all of which would go into reducing the lowest income tax bracket from 4.4 percent to 4.0 percent. • Reduce withholding tax for state income taxes by $322.6 million — this will let Wisconsinites keep more of their paycheck. A typical family of four will see about $58 more in their paychecks each month. By the end of this year, that’s more than $520 dollars. • Set aside over $100 million into the rainy day fund. • Increase the Wisconsin Fast Forward program by $35 million to focus on three new areas: 1) Support for dual enrollment programs between school districts and technical colleges that target high demand jobs; 2) Investment in our technical colleges to eliminate waiting lists in high demand fields like manufacturing, agriculture, and information technology; 3) Support for programs helping people with disabilities enter the workforce. For more information on the State of the State address and the Blueprint for Prosperity plan, visit www. prosperity.wi.gov.

> Misha Lee is Owner/ Founder of Lee Government Relations, LLC and lobbyist for IIAW. Follow Lee Government Relations on Twitter @mishavlee.

FEBRUARY 2014 | 19

Make sure in selecting your legal counsel for this agreement that you have an industry-specific firm. I’m very happy with the agreement that we ended up with and I am confident that it is not a “template agreement,” which was my fear in going with our old firm. Our process forced us to think about past traditional methods and create a plan that fit our situation. Had I went to my old firm I probably would have reduced the time it took to complete the agreement, but might have missed out on the creative aspect of the process. There are a few benefits of taking our course but having driven down this road, my advice is to stick with “your industry guy.” They will understand your issues and save you time and money.

Create Your Plan Once you have your successors and legal representation, it’s time to create your plan. Since every business is different, every plan should match the uniqueness of each situation. Start your process in a big visionary way and then work out the details. As we began designing our plan we decided that we had two major issues to solve: 1. How do we transfer ownership in the event of my death to my chosen “knights”? 2. Since my knights had shown a little concern about my prematurely selling the firm, how do we best contractually eliminate this concern?

WHAT IF THE UNTHINKABLE HAPPENS? I’m a 40-something owner of an independent insurance agency, and since 1996, when I began purchasing the agency, I’ve been asked about my perpetuation plan. I would usually laugh and say, “I’m only 25 or 26.” Perpetuation was the furthest thing from my mind and still is. But our main business partners pushed us for a perpetuation plan. They have a major investment in our company and want to know what will happen if there is a death or a retirement. They want to know what our plan is. So, what the heck does my company do if I die on the way to my next appointment? As the sole owner of my company, this created a dilemma. It’s a really good question. To prepare, I completed our agency’s perpetuation plan. Here’s what I learned.

The Who The first issue you must deal with when perpetuating your firm is The Who. Who is going to take your company forward when you sell, retire, or die? Do you have an internal person or group that is capable of moving your company forward, or must you look to an outside firm? Luckily, in our case, I have two quality employees that have proven

20 | FEBRUARY 2014

their loyalty and have a keen grip on the vision of our company. I must point out that in our particular situation the only plan that we really need to address at this point is my death. I have no interest in selling and I’m not going to retire at my age. My one perpetuation issue is death. Of course, as time passes our plan will be adjusted to consider other issues, but for now, the big D is our main issue. In selecting The Who, many factors must be taken into consideration. Family issues, future children may want to have a stake in your company, as well as the children of key employees if your company is a small familytype firm. Future key employees should be considered in that if you are a viable firm you will at some point be bringing in new blood, and a great selling point to this new hire will be participation in your company’s perpetuation plan. When designing your plan the most important thing in The Who

decision is twofold: who now and who in the future. Allow your plan to be flexible enough to allow both into your agreement.

Another Who The next issue once you have your successors is Another Who. Who is going to design your plan? It was at this stage in our process that I made a major mistake. For years I have been using an industry-specific law firm. They understood our issues and always provided excellent advice. The firm is located about 90 minutes away so there was always that little travel issue. So, I thought a local firm could take care of this “little item.” At a local business meeting I approached an acquaintance and partner in a local, well-respected law firm. He said “no problem” and referred me to another partner who specialized in this area. Upon meeting this partner I had no doubt this would be an easy agreement to finalize and felt comfortable with his understanding of our industry and the mechanics of such an agreement. However, as time passed I frequently found myself retelling my firm’s story, the ins and outs of our industry, valuation models, salesperson compensation issues, etc. WISCONSIN INDEPENDENT AGENT

Let me tackle the second issue first. In our discussions, I said I’d never sell. “I love what I do. I’m only good at selling things, etc.” Wait a minute, my chosen ones thought. As other similar-sized companies sell for ridiculous amounts of money, what if you decide to take the money and run? Where does that leave us?

My successors are required to keep in force the life insurance and to use that to purchase the company at the time of my demise. As the company continues to grow we will constantly review the amount of coverage needed, but in the event that the life insurance fails to cover the value of the company, we’re confident that some lending institution would step up and fund the remaining 10% or 20%

Make sure in selecting your legal counsel for this agreement that you have an industryspecific firm. They will understand your issues and save you time and money. shortfall, with the understanding that the same basic management team would continue our vision for running the company. If you’ve read this and do not have a perpetuation plan, pick your successor — your Who — and call your industry-specific law firm today and make your appointment. If you have completed this agreement, pull it out and make sure it is still what you need, that it’s properly funded and still has the correct successors. A perpetuation plan is a smart idea for you, your employees, your vendors, your customers, and your family.

Our solution came from a dear friend who suggested utilizing a first right of refusal. If you get an offer you can’t refuse, allow them to match that offer. If they are unable, sail off into the sunset. This seemed like a simple solution and it was. After a little discussion with my successors, they agreed and we moved on to the next issue. The next problem we had was how do we logically transfer ownership to these two successors and still leave the door open for future partners? We solved that issue in, I think, a creative way. We agreed that at the time of my passing, the sum of all my successors books of businesses would be computed. Each successors percentage of this sum would then be figured and they would be responsible to purchase this percentage of the company’s stock. To make sure they had the proper funds we used a little tool called life insurance. I’m happy to say that my successors were able to buy multiple millions of dollars of insurance on me at the most preferred rate available. Let’s see, if you work out, watch those fried foods, and drink just the right amount of wine…you get the preferred rate. (Note to self: continue current behavior!) To address the future partners, we created a valuedemployee agreement that was sales based and allowed for multiple people to become part of our plan. To summarize, in the event of my > Andy Thompson owns untimely death, our company will be valued. an independent agency This valuation will determine how much my in Parker City, Indiana, spouse gets for the company. To add to my and writes regularly peace of mind, my family will be taken care of for insurance trade publications. financially.

the We look for the best independent agents and build relationships that last the duration. We are committed to the independent agency system as the only means to deliver our products. Because of that, we work hand-in-hand to help our agencies grow profitably.

Our agents set us apart. For information about becoming a Partners Mutual Insurance Agent please contact Lyn Schumann at 262.432.3430 or Schumann.Lyn@PartnersMutual.com

FEBRUARY 2014 | 21

WISCONSIN INDEPENDENT AGENT

PMIC_3-75x4-875_WIA.indd 1

1/16/2014 10:58:49 AM

VIRTUAL UNIVERSITY Rated A+ (”Superior”) by A.M. Best Company

A Strong Company Just Got Stronger! GUARD is now part of Berkshire Hathaway – giving us an immense base upon which to grow. We feature the same products, services, and personalized attention that marked our first three decades of success as a specialist in writing small- to mid-sized Workers’ Compensation risks (under the name of GUARD Insurance Group) . . . but with one very important difference. We now have a new ultimate parent – Berkshire Hathaway – and BILLIONS of dollars of capital and invaluable expertise to support us.

New to Wisconsin! We are expanding and looking to appoint quality independent agents to grow with us in the state.

2014 CHANGES IN THE ISO HOMEOWNERS PROGRAM ISO has introduced two new HO endorsements and revised one HO endorsement: > HO 06 31 01 14 - Green Updates Coverage

upgrades are limited to products and practices recognized by a “green standards-setter” which serve the same primary function as the damaged property:

> Stoves, wall ovens, and refrigerators > Well water pumps and sump pumps > Central vacuum systems

> HO 06 33 01 14 - Mechanical Breakdown Coverage > HO 04 95 01 14 - Limited Water Back-Up And Sump Discharge Or Overflow Coverage

> “Green” means enhanced energy efficiency or use of environmentally-preferable materials (such as vegetated roofs), sustainable materials, or products or methods recognized by a “green standards-setter.”

> Home security and automation systems > Swimming pool pumps and filtration systems > Saunas, hot tubs and therapeutic baths

The revised HO 04 95 endorsement seeks to clarify coverage for water back-up and sump discharge or overflow. The new endorsements provide a way to insure “green” upgrades following a loss (HO 06 31) and a means to cover certain equipment and appliances for mechanical breakdown short of effecting a maintenance agreement (HO 06 33).

HO 06 31 01 14 – Green Upgrades Coverage The optional HO 06 31 01 14 – Green Upgrades Coverage endorsement provides optional coverage for green upgrades following damage to the residence premises and personal property. It can be used with the HO 00 02, HO 00 03, HO 00 05, or HO 00 06 policy forms to modify Coverages A, B, or C depending on the policy to which it is attached. In order for the endorsement to apply to Coverage C – Personal Property, the Personal Property Replacement Cost Loss Settlement Endorsement HO 04 90 (or state-specific equivalent) must be attached. The endorsement provides two types of coverages. First, Green Upgrades Property Coverage applies an increased cost of loss percentage, subject to a maximum dollar amount, for “green” upgrades to Coverages A, B or C. “Green”

> A “green standards-setter” means an accredited organization or governmental agency which produces, maintains guidelines, and certifies or rates green products and practices such as the LEED® program, ENERGY START, and Green GlobesTM. Second, the endorsement includes Green Upgrades Related Expense Coverage as an option that permits recovery for waste reduction and recycling, design and engineering professional fees, certification fees and related equipment testing, and building air-out and related air testing.

HO 06 33 01 14 – Mechanical Breakdown Coverage This optional endorsement provides coverage for certain household equipment and appliances such as: > Central HVAC systems > Water heaters

(Not yet a Berkshire Hathaway GUARD Agent but anxious to get started as soon as possible? Visit www.guard.com/apply.)

The optional HO 06 31 01 14 – Green Upgrades Coverage endorsement provides optional coverage for green upgrades following damage to the residence premises and personal property. WISCONSIN INDEPENDENT AGENT

> Chairlifts and elevators > Electric vehicle charging stations The endorsement provides “blanket”-type coverage vs. the specific-appliance coverage commonly provided by warranties or service contracts. However, to prevent the endorsement from becoming a maintenance contract, it includes an aggregate limit of insurance. In addition, the base policy deductible applies to losses and coverage is excess over any other insurance, warranty or service plan.

HO 04 95 01 14 – Limited Water Back-Up And Sump Discharge Or Overflow Coverage In 2001, this endorsement was revised to clarify that the water back-up coverage was limited to damage caused by water or waterborne material which originates from within the dwelling in which the named insured resides. In other words, back-up or sump discharge/overflow resulting from flooding is not covered. To further clarify this, the language referenced in the endorsement as an exception to the Water Exclusion has again been revised to more closely conform to the limited coverage provided by the endorsement. In addition, language is revised to clarify that the Power Failure Exclusion in the policy does not apply to loss resulting from the failure of a sump pump due to power failure. The first revision is considered by ISO to be a clarification or restatement of coverage, while the Power Failure language revision is a > Bill Wilson is director of the Virtual University. broadening of coverage. The Virtual University is a Big “I” members-only resource. Many articles are based on real-life questions received by the Ask an Expert service. This service ensures that the information is current and topical. Go to www.independentagent.com/ Education/VU/. You will need to login with your IIABA username and password before using the VU. The IIABA does not assume and has no responsibility for liability or damage which may result from the use of any of this information.

FEBRUARY 2014 | 23

MARKETING MINUTE

INCREASING YOUR AGENCY’S WEBSITE TRAFFIC

Your agency website is the most important piece of Internet real estate you actually own. It is your home base. It is the core component to creating, enhancing, and mastering your Internet presence. Social platforms are also important and are another part you use to master your Internet presence. But, the big problem is you don’t actually own your profile on any social platforms. You are simply renting or leasing space on those platforms. At any time, Facebook, LinkedIn, Twitter, YouTube, or any other platform could shut down your account. And you have virtually no recourse.

visits to corporate websites from social media sites and this is steadily increasing.

Your website is so important. You own it. You manage it. You enhance it. It’s a great tool to help people understand how they can benefit from the products and services you offer.

Facebook’s share by contrast has decreased by nearly 50% in two years, 30% to 17%, and the findings may indicate that Facebook is a declining platform for B2B corporate marketing. It continues to be a good platform for connecting with individual consumers.

That’s why your website is so important. You own it. You manage it. You enhance it. It is a great tool to help people understand how they can benefit from the products and services you offer. So, how should you use the social platform outposts to drive people to your agency website? And maybe more importantly, which platforms should you spend your time developing? The Investis IQ Audience Insight Report published in October 2013 gives us some insight to be able to answer this question. The report tracked visitors to corporate websites from social media platforms. Their research found that LinkedIn drives significantly more traffic to corporate websites than all the other social platforms combined. According to the survey, LinkedIn accounts for nearly two-thirds, 64%, of all

24 | JANUARY 2014

Twitter is also gaining in influence, up from 4% in 2011 to 14% today, which reflects the increase in the number of companies adopting Twitter for corporate communications.

At least for this survey, visits from Flickr, YouTube, Google+, and SlideShare are all negligible, at least for now. LinkedIn, Facebook, and Twitter are responsible for 95% of visits to corporate websites from social media sites. Just to be clear, I believe Google+ is a special case. While the use of Google+ may not be driving business traffic to your website, it is an important platform to be active on because of its search engine optimization (SEO) benefits. The Investis report said that 54% of corporate website traffic came as a result of a search engine. The report also found that 20% of all traffic to corporate websites came from mobile

devices. However, less than a quarter of companies (23%) provide either a dedicated mobile site or a responsive website. There is clearly a lot more for corporate websites to do. Here are some steps you can take to master your Internet presence: 1. Continue to enhance your agency website. The more information you provide on your website the more likely someone will find you. 2. Make everything mobile friendly. Your website needs to be easily viewable by any type of device that might access it. People are using smartphones and tablets to search. What does your website look like on those platforms?

The Water and Microbial Remediation Experts

3. Focus on your LinkedIn marketing. There’s never been a better time to enhance your presence on LinkedIn. It should be mandatory that every salesperson fully complete their LinkedIn profile. Also, make sure your agency LinkedIn company page is up to date.

Client Catastrophe: MOLD

4. Make sure all of the social platforms you use have links back to your agency website. Remember, your agency website is your home base — all other platforms where you “rent” space are your outposts that point back to your own platform. These are beginning steps you can take to maximize your agency Internet presence and help drive businesses to your agency.

WATER U MOLD U SEWAGE U FIRE

24/7/365 EMERGENCY > Steve Anderson provides information to insurance agents about how they can use technology to increase revenue and/ or reduce expenses. Visit his website at www. steveanderson.com.

WISCONSIN INDEPENDENT AGENT

608.210.1993

“I want you to know how appreciative our family is of the exceptional work performed by you and the staff at Capital Remediation. Throughout the entire process we were kept well informed and felt like the work being done was the same as would have been done for your family. The work was of high quality and Capital Remediation met all the unique challenges involved. I was impressed with the speed and efficiency with which Capital Remediation was able to secure an array of skilled resources (remediation, carpentry, cabinetry, etc.). I never was surprised, felt treated fairly, and the completed work was of high quality. I couldn’t be more pleased with the experience our family had with Capital Remediation.” Noal Miles

Call Deborah Mann, Commercial Consultant U 608.417.0611 6330 Copps Ave., Suite C, Monona, WI 53716 UÊÊcapitalremediation.com Delivering Total Project Accountability WISCONSIN INDEPENDENT AGENT

FEBRUARY 2014 | 25

FROM THE ARCHIVES

WS E N E H T N I S R E B M ME Integrity Insurance Promotes Jill Wagner To President Jill Wagner has been promoted to President of Appleton-based Integrity Insurance. She previously held the role of Vice President of Commercial Lines for the property and casualty insurer. Wagner came to Integrity in November 2010 to lead the Commercial Lines team. Previously she served in leadership roles with SECURA Insurance in Appleton. Wagner has worked in the insurance industry for 22 years including positions with Rural Mutual Insurance and ACUITY Insurance. She is a 1992, summa cum laude, graduate of Lakeland College in Sheboygan, Wisconsin, where she also earned her MBA. She is a Board Member of Big Brothers/Big Sisters of the Fox Cities, served as the Chairman of the Commercial Lines Underwriting Conference Committee for NAMIC and is a Business Advisory Group Member of Lakeland College and Concordia University. She has held numerous board positions with youth-focused organizations. Integrity’s Chairman of the Board, Thomas S. Stewart shared: “Jill is a proven insurance industry leader who has been instrumental in directing the recent success of our Commercial Lines operation for Integrity. She has excelled at every assignment she has been given and there is no doubt she will exceed expectations as she assumes this new position.” “I am thrilled to have the opportunity to serve in this new capacity for our company and I look forward to working with all of our agents and associates to continue delivering financial stability for all of our stakeholders,” said Wagner. “We have the best people in the industry working on behalf of our policyholders and I look forward to leading our team.” As a part of this change in leadership, Stewart also announced that Peter McMurtrie, Vice President, Chief Sales, Marketing and Affiliate Officer of Grange Insurance in Columbus, Ohio, was elected to the Board of Directors of the company. Integrity Insurance is an affiliation partner of Grange Insurance. It is also the Board’s intent to nominate and elect Wager to the Board at the upcoming meeting in February. “Jill has done an outstanding job since arriving at Integrity just over three years ago, where she has overseen tremendous business results as well as building a department that is one of the best in the region,” said new board member McMurtrie. “I am very pleased to be working with Jill in her expanded role as our new business leader in Appleton.” For more information about Integrity Insurance, please visit www. integrityinsurance.com.

26 | FEBRUARY 2014

SECURA Announces A.M. Best Affirmed A (Excellent) Rating A.M. Best affirms SECURA’s financial strength rating (FSR) of A (Excellent) with a stable outlook. The affirmation of the company’s ratings reflects its strong riskadjusted capitalization, long-standing regional business presence, conservative balance sheet, and the benefits derived from its ongoing agency relationships and cultivation. A.M. Best also noted SECURA’s improved trends in underwriting results since 2012 and the strategies its management team has implemented that have contributed to its results, such as: aThe development and implementation of enhanced pricing models. aExpense management initiatives. aTargeted agency management action plans. “As a mutual company, we run our business with our customers’ best interests at heart,” said CEO John Bykowski. “That means remaining a strong, financially stable company for our policyholders, agents, and associates to rely on for the long term. A.M. Best’s affirmation reflects our ability to excel in this mission.” For more information about The IMT Group, please visit www. secura.net.

ACUITY Employees Present $250,000 To Community Organizations The ACUITY Charitable Foundation awarded $250,000 to community organizations and charities, with ACUITY employees distributing the amount among six different groups that serve the Sheboygan County area. Those groups included Safe Harbor of Sheboygan County, Sharon S. Richardson Community Hospice, The Salvation Army, Meals On Wheels of Sheboygan County, Sheboygan County Health and Human Services, and Sheboygan County Interfaith Organization. “Five years ago, we were struggling financially,” said Laura Roenitz, Executive Director, Safe Harbor of Sheboygan County, which received the largest amount of staff-directed funds from ACUITY. “The financial support from ACUITY over the past five years has helped us hire more staff and significantly increase the number of people we are able to serve.”

WISCONSIN INDEPENDENT AGENT

This great shot was taken May 16, 1935, in front of a police station in Madison. The portrait shows a group of officers receiving their insurance policies. The police station was at the corner of East

Washington Avenue and South Webster (14-16 South Webster), one block from the Capitol. The building that sits there now is the US Bank Plaza. Source: Wisconsin Historical Society

Safe Harbor provides services related to domestic abuse, including prevention education, crisis intervention, and transition services. The funding received from ACUITY will allow Safe Harbor to open an additional office in Plymouth. “We will also be able to expand our prevention education in local schools,” said Roenitz. “The support we’ve received from ACUITY and the partnerships we’ve built with many other organizations in Sheboygan County have helped us work together to break the cycle of violence and silence.” Guided by the ACUITY Charitable Foundation, the company has donated approximately $12 million to worthy causes over the past eight years. ACUITY’s social stewardship also includes in-kind donations and use of the company’s corporate headquarters for charitable events. WISCONSIN INDEPENDENT AGENT

In addition, ACUITY employees contribute to charitable causes each year though donations of time, money, and much-needed supplies. In the company’s recent holiday gift drive, ACUITY staff members donated nearly 40 cases filled with gifts to Sheboygan County Health and Human Services for distribution to local families. “We believe in supporting the communities where we work, live, and do business,” said Ben Salzmann, ACUITY President and CEO. “We also know that being a good corporate citizen means more than just making monetary contributions. It means being individually involved and having a personal stake in the organizations that make a difference in our community.” For more information about ACUITY, please visit www.acuity.com.

FEBRUARY 2014 | 27

SALES & MARKETING IDEAS FOR AGENCIES aS earch Engine Optimization - Did you know 70% of insurance shoppers go online during the process? If you’re not on the first page of Google you’re not even in the game! Improving your agency’s search rankings is hard work and making a mistake can even get banned from Google! If you’re serious about getting better search rankings, I recommend hiring a respected insurance SEO company. If you’re one of those, “I want to do it myself” guys or your marketing budget is too small to afford hiring the experts, at least follow a structured SEO plan built for insurance agencies. Your agency can’t afford to miss out on 70% of the market! olunteer - The hand that gives, gathers. There are many aV opportunities for growing your business while volunteering. You can get great PR in the newspaper, meet other local community members and business owners, and educate people about the values and benefits of insurance. Choose a nonprofit you have some interest in since the more passion you have, the more benefit.

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in a complex business world. Your business clients make hard decisions every day, but now you can make selecting the right insurance coverage easy with a Pekin Insurance® Commercial policy that is specifically designed for preferred property risks.

Check out some of the preferred property risks that we have insured in the last year: • $12,204,200 total property value for a Machine Shop • $10,050,000 total property value for a Metal Goods Manufacturer • $6,000,000 total property value for a Lessor’s Risk Shopping Center • $9,900,000 total property value for a Warehouse and Distribution Center

We go Beyond the expected® with valuable services like Loss Control, a Return to Work program, a Special Investigations Claim Unit, and much more. Partner with a company that offers some of the most innovative products available in the industry today and is continually searching for ways to become the easiest company for you to do business with.

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Rental Cars: More Than Meets The Eye  2 CE Credits Approved  Date: February 17, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 12:00 – 2:00 PM

E&O Risk Management – Meeting The Challenge Of Change  6 CE Credits Approved  Date: February 25, 2014  Location: Madison  Time: 8:30 AM – 2:30 PM

From Medicaid To the Exchange: What Every  Agent Should Know  3 CE Credits Approved  Date: February 18, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 12:00 – 4:00 PM

Hot Topics In Personal Lines  2 CE Credits Approved  Date: February 26, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 9:00 – 11:00 AM

From Medicaid To The Exchange: What Every  Agent Should Know  3 CE Credits Approved  Date: February 19, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 8:30 AM  – 12:30 PM

From Medicaid To the Exchange: What Every Agent Should Know  3 CE Credits Approved  Date: February 26, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 12:00 – 4:00 PM

Ethics In Today’s Changing Times  4 CE Credit Approved  Date: February 19, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 12:00 – 4:00 PM

Policy Provision Potpourri  2 CE Credits Approved  Date: February 27, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 8:00 – 10:00 AM

Ethics: When The Impossible Happens  4 CE Credits Approved  Date: February 20, 2014  Location: Pewaukee  Time: 8:30 AM – 12:30 PM

From Medicaid To the Exchange: What Every Agent Should Know  3 CE Credits Approved  Date: February 27, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 8:30 AM – 12:30 PM

E&O Risk Management – Meeting The Challenge  Of Change  6 CE Credits Approved  Date: February 20, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 8:00 AM – 2:00 PM

E&O Risk Management – Meeting The Challenge Of Change  6 CE Credits Approved  Date: March 4, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 9:00 AM – 3:00 PM

Insurance And The Property Lease  2 CE Credits Approved  Date: February 20, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 8:00 – 10:00 AM

Liability Issues To Worry About  2 CE Credits Approved  Date: March 4, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 9:00 – 11:00 AM

Data Privacy Insurance  2 CE Credits Approved  Date: February 24, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 12:00 – 2:00 PM

From Medicaid To the Exchange: What Every Agent Should Know  3 CE Credits Approved  Date: March 4, 2014  Location: ABEN Online – iiaw.aben.tv  Time: 12:00 – 4:00 PM

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TO RECEIVE 20% OFF ANY 2014 IN PERSON CONTINUING EDUCATION CLASS ENTER PROMO CODE: THANKS   WISCONSIN INDEPENDENT AGENT

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FEBRUARY 2014 | 29

FOOD FOR THOUGHT

A C U I T Y

U N I V E R S I T Y

P R E S E N T S

TEST YOUR MENTAL SHARPNESS Take a stab at these interesting questions. Answers are below. 1. Johnny’s mother had three children. The first child was named April. The second child was named May. What was the third child’s name? 2. A clerk at a butcher shop stands five feet ten inches tall and wears size 13 sneakers. What does he weigh? 3. Before Mt. Everest was discovered, what was the highest mountain in the world? 4. How much dirt is there in a hole that measures two feet by three feet by four feet? 5. What word in the English language is always spelled incorrectly? 6. Billie was born on December 28th, yet her birthday always falls in the summer. How is this possible? 7. In British Columbia you cannot take a picture of a man with a wooden leg. Why not?

ARE YOU READY FOR ONE?

8. If you were running a race and you passed the person in 2nd place, what place would you be in now? 9. Which is correct to say, “The yolk of the egg is white” or “The yolk of the egg are white?” 10. A farmer has five haystacks in one field and four haystacks in another. How many haystacks would he have if he combined them all in one field? Source: Forbes.com ANSWERS:

PLACED

1. Johnny. 2. Meat. 3. Mt. Everest. It just wasn’t discovered yet. 4. There is no dirt in a hole. 5. Incorrectly (except when it is spelled incorrecktly). 6. Billie lives in the southern hemisphere. 7. You can’t take a picture with a wooden leg. You need a camera (or iPad or cell phone) to take a picture. 8. You would be in 2nd place. You passed the person in second place, not first. 9. Neither. Egg yolks are yellow. 10. One. If he combines all his haystacks, they all become one big stack.

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