The Insurors of Tennessee Bulletin 1321 by Insurors of Tennessee

bulletin YOUR ASSOCIATION NEWSLETTER

volume 13-21

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friday

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november 1, 2013

Insurors President Eddie Miller presents the 2013 Insuror of the Year award to Maurice Pinson of Fridrich, Pinson & Rothberg

A Recap of Our 120th Annual Convention Over 460 attendees were on hand at the Insurors 120th Annual Convention in Tunica, our largest event since 2000. We hope you were one of those attendees, but even if you weren’t we want to hear from you. Take our online survey by Friday, November 8th and you will be entered to win a free registration for the 2014 convention. Visit https://www.surveymonkey.com/s/YJMWZFK to take the short 5-question survey now. As for this year’s event, the festivities kicked off with our group at the Ole Miss tailgate in The Grove before a thrilling victory over LSU. Then on Sunday afternoon, over 70 exhibitors were on hand to meet with agents and discuss new business possibilities. Sunday night saw our opening celebration featuring the ELEMENT of Cirque. With fire juggling, acrobatics, high flying aerials and defying acts of balance, the group kept our guests entertained through a lively evening of colors, sounds and lights.

Insurors of Tennessee Web: www.insurors.org Ph: 615.385.1898 or 800.264.1898 Fx: 615.385.9303 E-mail: info@insurors.org

Monday morning reconvened the exhibit hall, and our breakout sessions featured some great information on preparing clients for the ACA implementation as well as information on buying insurance agencies. We then saw our exhibitors give out door prizes to dozens of lucky winners. Monday afternoon included a host of optional activities. The golf tournament was again won by the team of Taylor Porch, Andy Porch, Joe Hunt and Jim Petty. The clay shooting saw Brandon Patterson claim his spot as the “Top Shot.” We also may have some new chefs on hand as the cooking class was a big success. Our Monday evening included Poker and Blackjack Tournaments, and our winners included Past President Walt Bradshaw, Samuel Bledsoe, Tom O’Connell and C.W. Bartlett. Tuesday morning wrapped up our event with the Association Day Annual Meetcontinued on page 2

WCAC Reviews Latest NCCI Loss Cost Filings The Workers’ Compensation Advisory Council (WCAC) met on October 31st to review the National Council on Compensation Insurance (NCCI) experience and law-only loss cost filings. The NCCI filed for an overall 8.4% decrease in loss cost based on past experience to be effective March 1, 2014 and for an additional overall 5.9% decrease to be effective July1, 2014 to reflect the changes to the workers’ compensation system contained in Public Chapter 289 passed by the 108th General Assembly and becomes effective July 1, 2014. After hearing actuarial reports from the Department of Commerce and Insurance, the WCAC, and the NCCI, the Committee voted to recommend that the Commissioner approve an overall 6.95% decrease for the experience only filing and a 5.9% decrease for the law-only filing. The recommend 5.95% decrease splits the difference between the NCCI request of an 8.4% decrease and the 5.4% decrease recommend by the actuary working for the Insurance Department. The 5.9% decrease for the law-only filing was the same as the change filed by the NCCI. The Commissioner must approve the filings within the range filed by the NCCI and that recommended by the WCAC or she can disapprove the filing and request that the NCCI make a new filing. We will let you know when the decision is made.

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Bulletin Vol. 13-21

A Recap of Our 120th Annual Convention continued from page 1

ing. We heard from Big “I” Executive Committee member Randy Lanoix, our 2014 Board of Directors was inducted into office, and some of our most prestigious awards were presented. Presidential Citations were awarded to Fred Faulk of CNA, Tammy Goodman of Selective, Bill Emerick of Berkley Southeast and Ebby Miller of Miller | Loughry | Beach Insurance in Murfreesboro. The Arch Northington Young Agent of the Year award went to Taylor Porch of Porch-Stribling-Webb Insurance in Waverly. The Jim Alexander Chairperson of the Year award was won by Joe Hunt of V.R. Williams/H.B. Cowan in Winchester/Shelbyville for a second straight year. The event culminated in the awarding of the Insuror of the Year for 2013. This year’s winner was Past President Maurice Pinson of Fridrich, Pinson and Rothberg in Nashville. We wrapped our 2013 meeting with the popular door prize giveaways, and many winners left with new items, including Susan Jackson of Liberty Mutual, who took home the 2013 Lava Lamp. We hope you will make plans now to join us for the 121st Annual Convention, taking place October 11-14 in Nashville at the new Omni hotel downtown.

More Questions on WC Rules and CSP Audits Insurors received a question regarding audits under the new Construction Service Provider law this week. “If an exempt CSP goes to work for a General Contractor on a non-commercial project, is it proper for an auditor to pick the ECSP up on the General’s

November 1, 2013 policy at audit?” We have discussed this question at length with the Tennessee Department of Commerce and Insurance and here is their response: “I read §50-6-902(a) to say that all construction services providers (CSP) shall be required to carry workers’ compensation insurance on themselves. However, per §50-6-902(b)(1), such provider will be exempt from subsection (a) if the construction services provider is rendering services on a construction project that is not a commercial construction project and is listed on the registry. Thus, if the CSP in question is not involved in commercial construction projects and they are listed on the registry, the workers’ compensation law exempts them from coverage as a subcontractor.” The Department also referred us to NCCI Basic Manual Rule H on Subcontractors, which provides some additional guidance on the subject. Section 1 states that a “certificate of exemption” may be provided as “satisfactory evidence” presumably that coverage is not required. So, an exempt CSP should not be picked up on the General Contractor’s audit, as long as the project is non-commercial. Further, it is clear under the definition section of the new law that the General Contractor is not responsible for the payment of compensation benefits since by statute §50-6-102(10) a properly exempted CSP does not fit the definition of “employee.” While the seven (7) factors in §50-6102 (10) (D) are still in the law, they should not be used in determining status of CSPs. The code sections referred to above should be used to determine status of CSPs. The seven (7) contained in §506-102 (10) (D) still do not include having a general liability policy, business cards, name of side of truck or various other factors carriers decided should be used prior to the passage of the Construction Services Provider law.

Flood Insurance Rate ChangesMaySeeDelay A bipartisan deal has been reached by the U.S. House and Senate to delay key changes to the NFIP that saw rate hikes for many homeowners. Rep. Maxine Waters (D-CA) ranking member of the House Financial Services Committee, announced the deal and said that she feels the changes will help implement the new rates in an affordable manner. Waters was a chief architect of the bipartisan Biggert-Waters Flood Insurance Reform Act that ordered an end to many premium subsidies for property owners and a remapping of communities along with other changes that are resulting in many homeowners facing big premium hikes and more property owners being told they must buy flood coverage. In some areas, the premiums hikes are beginning to affect home sales. The new legislation calls for a four-year delay in most rate increases and calls for FEMA to present a study calculating issues that affect the premium increases. FEMA has estimated it will take two years to complete the affordability study before regulations can be issued and reviewed by Congress, meaning rate increases would be delayed for approximately four years in total, according to Waters. “Over the past several months, I have felt the harm and heartache that many Americans have already experienced as a result of changes to the National Flood Insurance Program. From the start, I have made clear that I would lead the effort to fix the unintended consequences of the Biggert-Waters Flood Insurance Reform Act,” said Waters in a statement released by her office announcing the deal. Many lawmakers have been fighting for a delay in the Biggert-Waters reforms since they were implemented. The industry feels the legislation is necessary, and these new delays will further cloud the future of the NFIP. Page 2 of 4

Bulletin Vol. 13-21

November 1, 2013

CISR -Dynamics of Service November 20th Nashville

In a competitive marketplace, an agency’s or company’s most important asset is...its people. Give your personnel the tools they need to succeed!

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Bulletin Vol. 13-21

November 1, 2013

Insurors & National All. 2014 Course Schedule

Sell & Save More with VirtualRiskConsultant

House Passes H.R. 2374 Retail Investor Pro. Act

Below is our schedule for National Alliance CIC and CISR courses for 2014:

The Big I Advantage® Virtual Risk Consultant (VRC) powered by Rough Notes is a powerful online client service resource tool that all Big “I” members should consider. Providing useful information for everyone from agency principal to CSR, the VRC can increase an agency’s professionalism and pave the way to greater sales.

The Big “I” recently praised the U.S. House for passing H.R. 2374, the “Retail Investor Protection Act,” by Rep. Ann Wagner (R–Mo.). This bill aims to reform efforts by the Obama Administration to expand the fiduciary duty to broker-dealers.

3/5 CIC-Comm. Property Memphis 3/19 CISR-Insuring Casualty Nashville 3/20 CISR-Insuring Casualty Memphis 4/9 CIC-Life and Health Nashville 4/22 CISR-Agency Ops Johnson City 4/23 CISR-Agency Ops Knoxville 5/7 CIC-Agency Manage. Nashville 6/18 CISR-Pers. Residential Memphis 7/24 Ruble Graduate Sem. Nashville 8/13 CISR-Insuring Casualty Nashville 8/14 CISR-Insuring Cas. Chattanooga 8/20 CIC-Comm. Casualty Nashville 9/15 CISR-Elements of Risk Nashville 9/17 CISR-Personal Auto Johnson City 9/18 CISR-Personal Auto Knoxville 11/5 CIC-Comm. Property Nashville 11/12 CISR-Personal Lines Nashville 11/13 CISR-Personal Lines Memphis Get more information or register now at http://www.insurors.org

InsurPAC-NationalNear 2013 Fundraising Goal InsurPac, the political action committee (PAC) of the Big “I,” is roughly $200,000 shy of the million dollar mark as the 2013 campaign winds down. InsurPac has proudly served the independent agent community for more than four decades. It has raised voluntary, personal contributions from agents throughout the country and disbursed 100% of those investments to support candidates for federal office. More than 3,000 agents, brokers, PACs and others have supported InsurPac this year with a combined $782,000, putting InsurPac in a position to eclipse one million dollars in receipts by the end of 2013. Learn more about InsurPac by visiting http://www.insurpac.com/ or watching this informative video: http:// www.youtube.com/watch?v=yf9nr18z7f A&feature=youtu.be

Claims data for the Big “I” Professional Liability Program reveals that about 40% of claims involve failure to procure coverage and/or failing to adequately identify exposures. The Commercial and Personal Lines Risk Analysis Systems on VRC assist producers and CSRs. How does it do this? In addition to expanding agency staff’s knowledge about client and prospect operations, the VRC’s commercial and personal lines risk exposure analysis process offers a systematic approach to: •

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Understanding the client’s operation with overviews for more than 650 business classes and personal lines risks Identifying client exposures with customizable client surveys and questionnaires Creating thorough customer proposals featuring information pertinent to their operation and a glossary of insurance terms Prudently documenting customer files with signed coverage checklists

Similar products in marketplace sell for thousands per year. As a Big “I” member, you enjoy exclusive member pricing starting at just $250. Conatct Stephen Holmes at sholmes @insurors.org for more information, or learn more on the VRC page of the Big “I” website at http://www.independentagent.com/Products/non-insurance/ VRC/Pages/home.aspx

At issue are moves by the U.S. Department of Labor (DOL) and the Securities and Exchange Commission (SEC) to write two separate rules on investment advice provided by broker-dealers and investment advisers. The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank) grants authority to the SEC to expand the fiduciary standard currently applied to investment advisers to cover brokerdealers for retail investing. The DOL has jurisdiction over workplace retirement plans and individual retirement accounts. If implemented, H.R. 2374 would require the DOL to wait 60 days after the SEC finalizes any fiduciary rule before issuing its own regulation. The measure would also require the SEC to complete several important steps before issuing its rule, such as determining that any rule would not result in harm to consumers or restrict their access to investment advice, as well as completing a cost-benefit analysis.

Offer Your Clients PUPs Does Your Clients’ Auto Insurance Cover Them Completely? One in seven U.S. drivers are uninsured, according to The Insurance Research Council (IRC). Excess Uninsured/Underinsured Motorist Coverage Can Help Fill the Gap. Give your clients coverage with a company strong enough to stand behind them when the unexpected happens... A+ rated RLI Insurance Company. Contact David Williams at dwilliams@ insurors.org to get started today. Page 4 of 4