The Tennessee Insuror Jan/Feb 2010

THE TENNESSEE

INSUROR January/February 2010

Vol. 21 No. 1

www.insurors.org

8 14 48

Portraits of Success Meet Your 2010 Board of Directors

CSR of the Year Call for Entries

Survivor 2010: Insurance Agency Edition The Real Time 21 Day Challenge

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The Tennessee Insuror

contents

THE TENNESSEE

INSUROR Vol. XXI, Number 1 January/February 2010

features

Phone (615) 385-1898 Toll Free: 1-800-264-1898 Email: info@insurors.org Editor: Charles T. Bidek, CPCU Publisher: Daniel D. Smith, Jr.

4 Portraits of Success Meet Your 2010 Board of Directors

INSURORS OFFICERS

President ................................................................... Tee Zerfoss, III Immediate Past President ........................... Walt Bradshaw, J.D. State National Director .................................................. Brad Smith Vice President, Region II ........................................ Eddie Miller, III Vice President, Region I ............................................. Roger Smith Vice President, Region III and Pres. Elect ....... Ed Gibbons, AAI Treasurer ....................................................................... Joe Hunt, Jr. Secretary ................................................... John McInturff, III, ARM Director, Region I ................................................... Cindi Gresham Director, Region I ................................................ Chris Allison, CIC Director, Region I .......................................................... Bobby Sain Director, Region II .......................... Kevin Hale, CIC, CPIA, CWCA Director, Region II ....................................................... Jimmy Alsup Director, Region II ......................................... Dolly Tate, CIC, CISR Director, Region III ....................................................... Andy Shafer Director, Region III ...................................................... Bob McIntire Director, Region III ........... Steve Bryant, CIC, CPCU, LUTCF, AAI Young Agents Chairperson .................................... Cooper Jones

ADVERTISING

Display advertising rates, deadlines and specifications may be obtained by writing to Insurors of Tennessee, 2500 21st Avenue South, Suite 200, Nashville, TN 37212, calling 615-515-2601, e-mailing dsmith@insurors.org or online at www.insurors.org The Tennessee Insuror is provided to all Insurors of Tennessee members and associate members as a member service.

INSURORS OF TENNESSEE 2500 21st Avenue South, Suite 200 P.O. Box 120539 Nashville, TN 37212-0539 www.insurors.org

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CSR of the Year Call for Entries

10

How Does Your Credit Score Effect Your Mortgage Rate?

14

Survivor 2010: Insurance Agency Edition

48

The Real Time 21 Day Challenge

49

2010 Young Agents Day on the Hill

Application Process for 2010 Award is Now Underway

Take Part in the National Initiative to Experience Real Time A Behind-the-Scenes Look at the Tennessee General Assembly

departments 21

From Your President

A Stronger Association Helps Us All

23

From Your State National Director

25

From Your CEO

29

Education Calendar

31

Government and Legal Affairs

37

Broker Spotlight

39

Company Spotlight

41

Company Briefs

51

Meetings

53

Member Tips

A Rookie’s First Impressions Your $5,000 Dues

Crump Insurance Services Grange Insurance

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For the year of 2010, Insurors is once again fortunate to have an outstanding group of volunteers to lead our Association into the new decade. Over the years, we have found that our Board members are some of the most active and giving members of their local and state communities, and this year’s group is no different.

Just take a look at the profiles in this article to see how many associations, civic groups, businesses and other organizations benefit from the involvement of these members. We think you will agree that it is no accident that these Tennessee leaders have flourished in their environments. That is also why instead of viewing the information under each name as just a short biography, we prefer to think of them as “portraits of success.”

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Thomas B. “Tee” Zerfoss, III President

Tee is a co-founder of Martin & Zerfoss, Inc. in Nashville and serves as President of the Board for 2010. Tee’s contributions to Insurors of Tennessee include serving as Director of Region II from 2003 to 2005 and most recently as Vice President of Region II. In addition to his involvement with Insurors, Tee is a past President of Insurors of Nashville. A Nashville native, Tee graduated from Montgomery Bell Academy in 1971. He attended the University of Virginia, earning his B.A. in 1975. He began his insurance career after graduation when he joined Armistead, Miller & Wallace. He then went on to co-found Martin & Zerfoss in 1978.

The Tennessee Insuror

Walt Bradshaw, J.D.

Eddie Miller, III

iMMediate Past President

Vice President of region ii

Walt is the principal agent at Bradshaw & Company Insurors and serves as the Immediate Past President of Insurors, having just completed a successful term as President in 2009. He has worked at Bradshaw & Company since 1989. Walt graduated from Dyersburg High School in 1980 and earned a B.S. degree in Accounting from the University of Tennessee at Knoxville in 1984. He was awarded his Doctor of Jurisprudence degree in 1987 from the University of Memphis. He is a past President of the Dyersburg Rotary Club, the Dyersburg/Dyer County Chamber of Commerce and the Dyer County Fair and is active in various other community organizations. He and his wife, Jane, have a daughter, Anna Claire, and a son, Will, and attend First United Methodist Church in Dyersburg.

Eddie is a principal agent of Miller Loughry Beach Insurance Services in Murfreesboro, and serves as the Vice President of Region II. A Murfreesboro native, he graduated from Oakland High School in 1975. He then went on to graduate from Memphis State University in 1979. He began his insurance career immediately after graduation joining what was then the Miller Agency.

After becoming Miller & Loughry in 1989, the agency merged with Beach & Gentry Insurance in 2008 to form the current business. Eddie’s contributions to Insurors include serving as Young Agents Chair, Director of Region II and most recently as Treasurer. In addition to his involvement with Insurors, Eddie is heavily involved with several community groups including the Boy Scouts of America, Murfreesboro Parks and Recreation Commission, St. Rose of Lima Catholic Church, Rutherford County Sportsman’s Club, and the Sigma Alpha Epsilon Alumni Association. He and his wife Renee live in Murfreesboro with their children Emily, Jane and Elam.

Ed Gibbons, AAI

Vice President of region iii & President-eLect

Ed is the principal agent of Watauga Insurance in Johnson City, and serves as Vice President of Region III. Ed also serves as the President-elect of the Board for 2011.

A Church Hill native, Ed graduated from Church Hill High in 1964. He served in the United States Navy from 1967-1969 and attended East Tennessee State University, earning his B.S. in 1971. He began his insurance career at Watauga Insurance Agency in 1976.

Ed’s contributions to Insurors include serving as Director of Region III in 1993, 1994 and 2007. In addition to his involvement with Insurors, Ed is on the Board of Directors of Central Baptist Church, the Johnson City Lions Club, the Johnson City Ties for the Blind, the Lions Club District 12N, the Johnson City/Washington County Chamber of Commerce, the Friends of Olde Downtowne, the Johnson City/Washington County Boys & Girls Club and Consumers Insurance Company. He and his wife Theresa reside in Jonesborough and have two grown children and six grandchildren.

Roger Smith Vice President of region i

Roger is the principal agent of Thompson and Smith Insurance in Jackson and serves as Vice President of Region I. Roger graduated from Jackson Central-Merry High in 1977. Following completion of a BBA from Lambuth University in 1981, he earned his MBA from the University of Memphis in 1992. Roger joined Associated Insurance Services in 1996 and eventually took over as owner. In 1998 Associated merged with the Thompson Group to form Thompson and Smith, LLC. In addition to his service to Insurors, Roger is a past board member of the Chamber of Commerce of Jackson and has served in several positions for the West Tennessee Area Council of the Boy Scouts of America. He also serves on the Board of Trustees for University School of Jackson. Roger and his wife Rebecca reside in Jackson with their children Rebecca and George.

The Tennessee Insuror

Brad Smith state nationaL director

Brad is the principal agent of Smith-Berclair Insurance in Memphis. After graduating from Overton High School in Memphis and earning his B.A. degree from Union University in Jackson, he spent 3 years teaching and coaching before joining his father at Cecil Smith Insurance Agency. In 1998, he was named president of the agency. His previous work on the Insurors Board includes serving as Young Agents Chair and as President in 2006. He also served in the positions of Director, Secretary and Vice President of Region I for a total of 12 years. He was honored with the Insuror of the Year Award in 1992 and twice selected for the Chairman of the Year Award in 1987 and in 2004. He is also a past President of the Insurors of Memphis.

Active in his community, he serves on the Board of Directors for the Liberty Bowl Festival Association and served several years as Chairman of the Liberty Bowl Awards Luncheon. Brad is a college football official for Conference USA, now doing instant replay and served as President of the Conference USA Football Officials Association. Brad was selected to officiate the 2001 Army-Navy game and has worked many bowl games over the last 20 years. Brad and his wife, Cathy, have two sons, Kurt (23) and Kevin (18). He is also active in Grace Evangelical Church, where he serves as an Elder.

John McInturff, III, ARM secretary

John is a principal agent at Tri-State Claims in Kingsport and serves as the Secretary of Insurors. A Greeneville native, John graduated from Greeneville High School in 1981.

He attended the University of Tennessee at Knoxville, earning his B.S. in Business Administration in 1985. He began his insurance career with 5

USF&G in 1986 and joined Bennett and Edwards, where he later became president, in 1988. In 2006 Bennett and Edwards merged with McInturff, Milligan & Brooks to form the current agency. John’s contributions to Insurors include serving as Young Agents Chair in 1999 and as Director of Region II from 2001 to 2003. In addition to his involvement with Insurors, John is a past president of the Kingsport Jaycees, president of the HVFC Soccer Club and is involved with Junior Achievement of Tri-Cities, the Downtown Kingsport Rotary Club and the First Presbyterian Church. He and his wife Tonya reside in Kingsport with their children Laura and Lindsey.

Joe Hunt, Jr. treasurer

Joe is the Chief Manager of H. B. Cowan & Company in Shelbyville and V. R. Williams & Company in Winchester. After leaving his hometown of Charlotte, Joe went on to graduate from Wingate University in Wingate, North Carolina, with a B.S.B.A. in Business Management and a minor in Economics. In 1982 he started with Maryland Casualty Company, serving as a Market Manager. In 1988 he left the company side to begin working with independent agencies. Outside of his work with Insurors, he also has served on the executive board of the local community development center for over 15 years. He currently resides in Bell Buckle with his wife Jenny. They have two daughters, Hannah Kay and Sarah Ashleigh.

Chris Allison director of region i

Chris is a principal agent with The Allison Insurance Group, Inc., in Jackson, and serves as a Director of Region I. He received his Bachelors degree from Union University in Jackson, and began working in insurance sales in 1990. He has remained in the industry ever since. He formerly served Insurors as the Young Agents Chair in 2008. Chris now lives in Jackson with his wife Suzanne, and their daughter Ashlee.

Cindi Gresham director of region i

Cindi is the President of Boyle Insurance Agency in Memphis. After moving to Memphis from her hometown of Columbus, Ohio, she graduated from Overton High before attending Memphis State University. She started her insurance career in 1973 with George Holley Insurance, then moved to Carruthers Harris Agency in 1979. In 1987 she started with Boyle and has been there ever since. In addition to her work with Insurors, Cindi is a supporter of Page Robbins Adult Day Care Center and various senior and youth organizations, and is on the board of Insurors of Memphis. She is also active at her church, Collierville United Methodist. Cindi has two sons, Brad and Kyle, and six grandchildren. She resides in Collierville with her husband, Rocky, and is pursuing her CIC designation.

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Bobby Sain director of region i

Bobby serves as President of Bolivar Insurance and Real Estate in Bolivar and as a Director of Region I. He graduated from Bolivar Central High in 1974, attended the University of Mississippi, and then transferred and received his Associate of Science degree from J.S.C.C. in 1976. He completed insurance school with Hartford Insurance in 1977. He then joined Bolivar Insurance later that year, and has served as the agency’s President since 1987. He now owns the agency, as well as Clifft Insurance Agency. In addition to his responsibilities with Insurors, Bobby formerly served as the Mayor of Bolivar, is a licensed Certified General Real Estate Appraiser, a Real Estate Broker and a past Chairman of the Tennessee Real Estate Appraisers Commission. He and his wife DaJuan have two sons, Blake and Chase, as well as a daughter, Shelby. They are active members of First Baptist Church and they currently reside in Bolivar.

Jimmy Alsup director of region ii

Jimmy is the principal agent of Alsup and Associates, Inc., in Pulaski, and serves as a Director of Region II. He graduated from Giles County High School in 1968 and attended Martin Methodist Junior College before transferring to the University of Tennessee at Knoxville where he earned his degree in 1972. In 1978, he started his career with Richland Insurance in Pulaski.

After two mergers and the purchase of McNeese Insurance, the agency became Alsup and Associates in 1999. There is also a branch agency, Allen Insurance Group, which is located in Columbia. In addition to his work with Insurors, Jimmy is a member of East Hill Church of Christ, as well as a little league coach and board member. He and his wife, Nancy, have two grown children, three grandchildren and they reside in Pulaski.

Kevin Hale, CIC, CPIA, CWCA director of region ii

Kevin is founder of Hale Insurance and serves as a Director of Region II. He graduated from Joelton High School and attended Middle Tennessee State University where he received his B.S. in Mass Communications and was a member of the Track team as a pole vaulter. He attained his insurance license in 1981, and began working for Connecticut Mutual later that year. After stays at both Tennessee Farmers Mutual and Fridrich, Pinson & Rothberg, he went on to found his own agency, Hale Insurance, in 1990. In addition to his work with Insurors, Kevin is active in the Homebuilders Association and at his church, Grace Baptist. He also enjoys playing music and competing in marathons and triathlons. Kevin resides in Joelton with his wife LeAnne and their two daughters, Emilie and Anna Grace.

The Tennessee Insuror

Dolly Tate, CIC, CISR director of region ii

Dolly is the Commercial Lines Manager for Fridrich, Pinson & Rothberg Insurance in Nashville, and serves as a Director of Region II. She graduated from Antioch High School and has gone on to earn her CIC, CISR and INS designations. She is currently pursuing her CRM as well. She has worked with independent insurance agencies for over 30 years, the last 10 at her current location. She is the president of Insurors of Nashville, and also works in the community as supporter of Room in the Inn and the public school system’s PENCIL Partner Program. She is active in her church, St. Bethlehem United Methodist, where she teaches Sunday school and serves on the chancel choir and education committee. Dolly resides in Clarksville with her husband, Edward. She has an adult son, Russell.

Steve Bryant, CIC, CPCU, LUTCF, AAI director of region iii

Steve is President and CEO of Heritage Insurance Group in Johnson City, and serves as a Director of Region III. He received his B.S. in History and Communications from East Tennessee State University, and obtained his insurance license in 1977. After working for several agencies and brokers in the late 70s and early 80s, he founded Heritage in 1990. He has served as President and CEO since 1994. In addition to his work for Insurors, he is also a past president of the Johnson City Kiwanis Club, serves on the board of the Dawn of Hope Development Foundation and is a member of Munsey Memorial United Methodist. Steve and his wife Sherry currently live in Johnson City, and they have grown twin daughters, Morgan and Stephanie.

ville in 1995. Andy currently resides in Knoxville with his wife Teresa.

Cooper Jones young agents chair

Cooper is a Vice President of The Crichton Group in Nashville, and serves as the Young Agents Chair. He received his B.B.A. from the University of Mississippi before beginning his insurance career with Crichton (formerly Crichton, Brandon, Jackson and Ward), where he has been for over 7 years. He is currently on the board of the Insurors of Nashville, and serves his community as a volunteer for Junior Achievement, Hands on Nashville and as the president of the board for Fannie Battle Day Home for Children. He and his wife Hallie have two young children, Adeline and Landon.

As you can see, Insurors is lucky to have members who are willing to give of their time and resources, not only to us, but to the communities in which they live and work. Having Board members from independent agencies that vary in size, location, company representation, premium volume and specialty allows us to get a full perspective of the needs of Tennessee agents. Our Board members, like your Association, are here to serve you. If you have thoughts or suggestions on how to improve Insurors, don’t hesitate to contact one of the Board members or the Insurors office. u

Board of Directors Contact Information

Tee Zerfoss • 615.297.8500 • tzerfoss@martinzerfoss.com

Bob McIntire director of region iii

Bob is a co-founder and principal agent of McIntire & Associates Insurance and Real Estate in Cleveland. He is serving as a Director of Region III for Insurors. He graduated from Lee College in Cleveland with a degree in Business Administration. He and his father founded the agency in 1981. In addition to his work with Insurors, Bob serves on the Boards of the Cleveland Bradley County Chamber of Commerce, the Bradley Cleveland Services and the Cleveland Emmaus Community. He and his wife, Melinda, along with their children, Robby and Emily, are members of First Baptist Church.

Walt Bradshaw • 731.285.5767 • walt@bradshaw4insurance.com Ed Gibbons • 423.929.7103 • ed.gibbons@wataugainsurance.com

Roger Smith • 731.664.4750 • rsmith@thompsonandsmith.com

Brad Smith • 901.753.4323 • brad@smithberclair.com John McInturff • 423.245.3101 • jmcinturff@tsclaims.com Joe Hunt • 931.684.3323 • jhunt@hbcowan.com Eddie Miller • 615.896.9292 • eddie.miller@mlbins.com Chris Allison • 731.668.8444 • chris@allison-ins.com Cindi Gresham • 901.766.4298 • cindig@boyle.com Bobby Sain • 731.658.3011 • bsain1@bellsouth.net Jimmy Alsup • 931.363.1501 • alsup_1@bellsouth.net Kevin Hale • 615.321.4150 • kevin@haleinsurance.com Dolly Tate • 615.327.0105 • dtate@fprinsurance.com

Andy Shafer director of region iii

Andy is a principal agent with Shafer Insurance in Knoxville, and serves as a Region III Director. He has been with Shafer for over 13 years. He received his Bachelors degree from the University of Tennessee at KnoxThe Tennessee Insuror

Steve Bryant • 423.283.9811 • sbryant@herinsgrp.com Bob McIntire • 423.472.5058 • bmcint2950@aol.com Andy Shafer • 865.546.0761 • ashafer@shaferinsurance.com

Cooper Jones • 615.383.9761 • cjones@cbjw.net

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CSR of the Year Call for Entries Application Process for 2010 Award is Now Underway Now is the time to identify and nominate an exceptional insurance customer service representative for the 2010 Outstanding CSR of the Year Award competition. The National Alliance for Insurance Education & Research is now soliciting entries for candidates who consistently provide quality service, exhibit strong leadership capabilities, and have made valuable contributions to their agencies and communities.

A $1,000 cash award will be presented to the nominator of the national winner; the four national finalists will each receive $500; and the national winner will receive $2,000.

Established in 1991, the Outstanding CSR of the Year Award is one of the greatest professional honors a customer service representative can receive. “This award is a great opportunity to honor our frontline employees for the significant roles they play within our industry,” said William Hold, Ph.D, CIC, CPCU, CLU, President of the National Alliance.

The award is open to everyone, regardless of affiliation or designation. The only requirement is that the candidate be an insurance CSR or have primary duties in the customer service arena.

Once nominated, a candidate fills out a form, submits letter(s) of recommendation from professional reference(s), and writes a twopage essay on a designated topic. This year’s topic is, “Many people come to the insurance business by chance and stay by choice. In the first paragraph, briefly describe how you were first employed in the insurance business. Then, given the changes you have observed and anticipate in the future, explain what would be the best title for the CSR of tomorrow and why?”

The Outstanding CSR of the Year Award is judged primarily on a written response to the selected theme, addressing the CSR’s exceptional competence in the workplace and knowledge of the subject matter. This essay should display the CSR’s ability to express ideas intelligently. Additionally, the composition will illustrate how the CSR is a valuable asset to our industry, as well as the community.

Don’t hesitate to nominate an individual. It’s as easy as providing a name, address, and telephone number. Even if you don’t think your CSR could win or would write the essay, the nomination itself is often considered a reward to the candidate. Once you have nominated someone, encourage this 8

individual to write the essay. Also encourage your nominee to read past recipients’ essays, found at www.TheNationalAlliance.com.

If you have multiple CSRs in your office and are worried about hurting someone’s feelings, then make your nomination anonymously. Your name will not be given out unless you give specific permission to Insurors at the time of your submission.

The Tennessee recipient of the award receives a framed Certificate of Achievement and becomes a candidate in the National Outstanding CSR of the Year Award competition. From this field, four finalists are chosen who receive $500 each, a gold and garnet pin, and publicity in national publications. The winner of the National Award receives a $2,000 cash award, a gold and diamond pin, and a scholarship for his or her agency/company to any National Alliance program. The nominator of the National Award winner will receive a $1,000 cash award.

Last year’s winner in Tennessee was Stephanie Johns, CISR, of Lipscomb & Pitts Insurance in Memphis. Stephanie was also named as one of the four national finalists. The first, and only, national winner from Tennessee came in 1995, when Gladys Patterson, CISR, of Wood Insurance Agency in Knoxville won the award.

Nominations are currently being accepted by Insurors for the state of Tennessee. To nominate an individual, please send his/her name, agency/company, address, and phone number to: 2500 21st Avenue S., Suite 200, Nashville, TN 37214 or e-mail the information to lthrower@insurors.org. Please make a note if you would prefer that your nomination be kept anonymous. Upon receipt of nominations, candidates will be mailed all materials necessary to complete the entry process. The deadline for submission of the candidate form and essay is May 1, 2010.

The state entries will then be judged within two weeks of the entry deadline. State recipients’ names are submitted to The National Alliance and a news release is prepared allowing all state recipients to be announced and congratulated at the same time.

For further information on the 2010 Outstanding CSR of the Year Award, contact Laura Thrower at 615.515.2607 or by email at lthrower@insurors.org. u The Tennessee Insuror

The Tennessee Insuror

9

How Does Your Credit Score Affect Your Mortgage Rate?

by David Coldiron, Finworth Mortgage a Division of InsBank

If you have ever applied for a mortgage loan, you know that one of the first things that the mortgage lender does is pull your credit report. You are also likely aware that the score that is reported may allow you to obtain the best possible rate or it may result in a higher than market rate.

Keep Track of Your Score Consumers can check their credit for free on a website created by the federal government. The site charges users to check their scores, but offers the credit report from the three major credit reporting agencies minus scores at no cost. You can obtain your credit report once annually at www.annualcreditreport.com.

There are several factors that go into determining your score, which can range from 300 to 850. They include, but are not limited to, timely payments, ratio of credit outstanding to credit limit and, in some cases, debt settlement. Borrowers I check my credit once a year on the aforementioned website should strive to have a score of 740 or better in order to obonly to verify that there are no errors on the credit report. I tain the very best rates on mortgage do not pay to see my score since I Damage Points: loans. know that my scores will be in good How Mistakes Affect FICO Scores shape if there are no errors, I do not credit if your score if your score FICO has recently made available a max out my credit, and I make my mistake is 680 is 780 chart generally discussing “damage payments on time. points.� Although we all have some maxed-out down 10 to 30 down 25 to 45 indication of what it takes to have card points points It is important that if you check your good credit, we could not quantify 30 -day late credit, you do so with all three madown 60 to 80 down 90 to how particular decisions we make payment jor credit reporting agencies. The points 110 points could negatively affect our scores. agencies are Equifax, TransUnion down 45 to 65 down 105 to This chart somewhat pulls back the debt and Experian. Many lenders only resettlement points 125 points curtain for the first time. port to one or two of the agencies. foreclosure down 85 to down 140 to This means that if you pull only an 105 points 160 points Equifax credit report you could be How Can I Improve My Score? missing issues that are reporting on bankruptcy down 130 to down 220 to TransUnion and/or Equifax and vice 150 points 240 points I am often asked how one can imversa. prove their credit scores and the atsource: fico tached chart provides a great deal of answers with regard to that question. In addition to the inforIf there are any errors on your credit report you should conmation provided on the chart items like length of time credit tact the applicable lender immediately. Make note of the conhas been open matters. Credit reporting agencies like long tacts with whom you speak with and always try to get any credit histories on given debts. It is also beneficial to keep changes in writing. I sometimes see items still remain on the revolving (usually credit card) balances less than 50% of the credit report that borrowers have already addressed. Keeping available limit. Another thing to consider is that constantly good records will allow you to address these issues in short opening new accounts can damage your credit as well. Howorder. ever, opening new accounts in moderation does not typically have a significant influence on your score.

It has never been more important to keep your credit scores up, as the difference between borrowing rates for high scores Some borrowers consider using debt settlement agencies and lower scores is as wide as ever. Most folks can achieve to reduce the amount of debt they have outstanding. It can high scores by simply making payments on time and not borsound like a good program, but can be very damaging to rowing more than is necessary. Check your credit report ancredit. Often times, the debt settlement agencies will advise nually to make sure that no debts appear on the credit report their clients to simply stop making payments to the lenders. that should not.

After some time the lenders are willing to accept a portion of the amount they are owed rather than accepting what they If you have questions about how to improve your credit you believe may be nothing at all. should contact someone that you trust that works with credit 10

The Tennessee Insuror

HTTP://WWW.INSBANKTN.COM

The Tennessee Insuror

11

Using good judgment and borrowing in moderation will allow you to save hundreds, if not thousands, of dollars when opening new credit is necessary. If you would like to discuss how your credit score relates to mortgages in further detail, please give me a call at 615.345.9904 or e-mail me at david. coldiron@finworth.com. I would be happy to help.

About the Author David Coldiron is Vice President of Lending for Finworth Mortgage, an InsBank company. A Western Kentucky graduate who, after five years in the mortgage business, moved from Bowling Green to accept a position with Finworth. He has over seven years of lending experience.

About Finworth

Finworth Mortgage is a correspondent mortgage lender located in Nashville that was recently acquired by InsBank. To inquire about refinancing or purchasing a home, contact David tte David Coldiron ortgage Lender, Finworth Mortgage at 615.345.9904. You can also visit Finworth Mortgage online at www.finworth.com, which contains such valuable tools as ortgage, a Nashville-based monthly payment, additional payment, loan refinance and intation. InsBank and Finworth wisely” that terest demonstrates onlyamortgage calculators. u

me to expect from InsBank.

r mortgage-related needs, Mortgage at 615-386-7102.

4, Nashville, TN 37212 515-BANK (2265) Member FDIC

CONSTRUCTION

to discuss. If borrowers wait until the last minute before borrowing to try to fix credit issues, it could be too late.

WORKERS’ COMP INSURANCE

WWW.AMERISAFE.COM (866) 719-0267 12

The Tennessee Insuror

Real Time Service

with a Real Live Underwriter.

Do you remember when Real Time meant a relationship with a real underwriter? We do!

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by John Graham, President of Graham Communications

14

The Tennessee Insuror

The revolution is underway. In the simplest terms, no one wants to do anything they don’t want to do. If this sounds overly innocent, it isn’t.

When they changed the way they think about customers, they changed their brand and the business exploded. If all you think about is insurance, you can’t meet customer needs.

The supermarket now delivers groceries, the drycleaner will pick up and drop off your clothes and the milkman is back at our door. Most of us rarely go inside a bank and deposits by e-mail are here. Why even go to an ATM? Pharmacies are open 24/7/365, and just about any restaurant brings dinner to our door.

2. Ditch the “Mexican jumping bean”-type marketing

The iFood app not only plans, customer-rated meals, but it tells us the exact aisle where each ingredient is located in the supermarket of our choice. There’s someone to walk the dog and doctors are making house calls.

If we don’t want to, we won’t do it. It’s this simple. That’s the new mindset. E-mails require too many keystrokes so texting takes its place and no wonder the world is all-atwitter with no more than 140 keystrokes to tell the story. We ignore online forms with more than three questions.

Whether it’s property, casualty, life, disability or healthcare, no segment of insurance can escape this revolution. It’s time to stop playing “let’s pretend,” as if nothing’s happened or that “things are just a little different.”

When will personal lines’ sales be mostly online? If Geico, esurance and a few of the other direct writers have their way, the lion’s share will be there before we can figure out what happened. And it’s not just personal lines; term life already lives online.

The message is clear; we are totally intolerant of anything that gets between us and what we want to do. Americans have never liked intermediaries – like car dealers, retailers, insurance agents and particularly salespeople. Why do you think they call it “BJ’s Wholesale Club,” when it’s clearly a retail outfit? We may need an auto mechanic, but we don’t need a car dealer or salesperson. Life today is truly “plug and play.”

With the agency mergers, consolidations and compelling configurations, is there a place for the independent insurance agency? The answer is yes, but with daunting conditions. Here are a 10 thoughts on what it will take to survive in the insurance agency business in 2010:

1. Solve something and don’t just sell something The biggest problem insurance agencies face is that they sell something––they don’t solve anything. That’s why people don’t want to see you unless you can deliver the lowest price.

Bob Seltzer, Steve Stramara and the staff of the Seltzer Group in Orwigsburg, PA. figured this out. They help businesses solve bothersome problems, whether it’s HR issues, Workers’ Comp costs or anything else that’s people-related. They’re a resource for prospects and customers.

The Tennessee Insuror

Jumping from one gimmick to another is almost every insurance agency’s marketing story.

An e-mail invited the recipient to a seminar on “World-Class Marketing Made Easy.” Who can possibly believe that any marketing is easy? Too many insurance agencies are looking for simple, cheap answers that deliver incredible results. When they don’t get instant results, they jump from one gimmick to the next and the search never ends.

Marketing requires careful planning, solid discipline and consistent implementation. Unless an agency is willing to make the commitment, it will never become a marketing driven organization.

3. Use donations prudently Donating to every cause, joining every club, contributing to every church, serving on every board and attending every meeting is over and done. That’s yesterday’s networking in more ways than one.

Sure, a few donations are politically correct, but mostly it’s money frittered away, down the drain and every agent knows it.

Why not identify a need in the community and put your money and your agency’s energy into making something worthwhile that becomes your brand? Invest in making a statement that engages people. And when the calls and requests for money come in, you can candidly tell the story of where you’re putting your resources.

4. Develop niches “All marketing is niche marketing,” someone said. It isn’t but it should be. Unfortunately, most insurance agents didn’t see the memo. They work each day as uninspired generalists who attempt to quote every type of account and miss their greatest opportunities.

Insurance agents are like department stores––bland, lacking focus and easily ignored. Today’s customers expect expertise, not just vacuous phrases like “a full-service agency,” whatever that means. If anything, both consumers and business executives want to deal with specialists.

Many agents wait for an insurance company to drop “a special program” for machine shops or the like in their laps. And for three weeks they chase that until it peters out.

Why not figure out several niches that interest you and have a potential for success in your market area? Then, find a carrier who likes your plan for writing the business. An agent with a plan will impress them! Then, become known as the experts in 15

these areas.

5. Stop hoping for a hard market It’s “in” for insurance agents to talk about helping customers lower their insurance costs, while keeping their fingers crossed that a hard market will magically appear out of nowhere to beef up their revenues.

Sure, certain classes of business may “harden,” but the capacity of the global insurance market is such that there will always be carriers on the street driving prices down with their appetite for more market share. If you’re waiting for a hard market, you’ll be out of business.

We’re redefining the face of insurance by giving it one.

6. Help customers improve their businesses After twenty-five years as a producer, Sam Martin, Senior VP and member of Lipscomb & Pitts Insurance in Memphis, Tenn., took a year off to figure out if he wanted to stay in insurance or move on. “I came to the conclusion that I wanted to help businesses become more successful,” says Sam. He figured out how he could do that by staying in insurance.

He gets appointments with decision makers by saying: “I would like to review your Workers’ Comp account since at least 50% of employers are paying more than necessary.” Who wouldn’t want to see someone who wants to help them recover lost money? It goes almost without saying that a high percentage also asks him to manage their insurance. Providing meaningful assistance creates what works, a performance-based relationship.

7. Make prospecting a plan Insurance producers are incredibly optimistic or at least that’s the way it seems. They just “keep on quotin’,” hoping that something will stick.

That’s not even looking for the low hanging fruit. It’s just trying to get your hands on the stuff that’s dropped to the ground.

And then when an agent doesn’t have the lowest quote, it’s back to the underwriter to shave it a little thinner. That’s not prospecting and it’s certainly not selling. It’s just plain begging.

Serious prospecting is carefully planned and executed consistently. It’s designed to produce a steady flow of quality business over time by consistent and meaningful cultivation that sends the clear message that the agent is knowledgeable, customerfocused and helpful.

Susan Riebel FCCI Marketing Underwriter

FCCI marketing underwriters pave the way for partnership.

Insurance never looked this good.

8. Tear down a useless website Some are “fancier” than they were 10 years ago, but 95% of agency websites have zero value to a visitor. It’s all about the agency––how long they’ve been in business, a kindly nod to the “founder,” and a photo of the agency “team.”

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The Tennessee Insuror

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The Tennessee Insuror

Most feature pictures of the agency office building or some skyscraper-like structure aimed at creating the illusion that this is the agency “headquarters.” And, of course, there’s the inevitable photo of the principals, most of which are men. Take a lesson from the homepages of the Wall St. Journal, Yahoo, USA Today and Amazon.com. See what they are doing to get their customers involved.

9. Ask yourself why you deserve new business Too many insurance agencies just want more business, but they have no idea why they deserve it, other than to say, “We have great people” or something equally irrelevant.

The question, “Why should someone do business with us?” demands a thoughtful answer. What makes your agency unique?

If you can come up with a compelling answer, it’s time to do some “renovation” work. If you fail here, you’re helping to reinforce the “all that’s important is the price” mindset of so many customers.

10. Take back what’s yours––your customers Insurance companies have done an effective job of stealing your customers. Bottom line (and that’s what counts), the carriers don’t need you or want you mucking around with customers. And getting all those pesky customers off your back may

have seemed like a pleasant idea, so you ceded them to the carriers. Call Centers became the solution and you are now the dispensable middleman, particularly at critical moments such as when there’s a claim.

The Seltzer Group, along with others who understand what’s happening to the insurance business, have taken back their clients so that when there’s a claim, the customer calls Seltzer’s claim managers. Although doing as little as possible for customers may have an appeal, it also has a downside – you’re no longer important to them. If the customer fails to perceive you bring them value, they won’t value you. And that’s the end.

There are many more than 10 ideas for meeting today’s challenges and whatever tomorrow brings. However, it’s certainly worth noting that if you think you can just wait it out, you’re out––of the insurance business.

About the Author John R. Graham is president of Graham Communications, a marketing services and sales consulting firm specializing in the insurance industry. He writes for a variety of business publications and speaks on business, marketing and sales issues. Contact John at 40 Oval Road, Quincy, MA 02170; 617.328.0069 or jgraham@grahamcomm.com. Follow his blog at www.grahamcomm.com/wordpress or visit www. grahamcomm.com. u

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The Tennessee Insuror

From Your President

A Stronger Association Helps Us All

The year 2009 was a difficult one for all of us.

The weak economy and recession definitely took their toll. We saw our insureds struggling like never before. Some went out of business while others are just barely hanging on. In almost all cases, sales and payrolls were down resulting in lower premiums and lower commissions for agents. Audits resulting in additional premiums were almost nonexistent. Even our wealthy clients were asking us to shop their accounts. Most indications are that 2010 will not be much better, maybe even worse. The solution to this ongoing problem is simple. We must control expenses, make every effort to renew what we have and most important, focus intensely on writing new business.

Our Association does not behave much differently. The dues that we paying are simply not enough to support the expenses incurred. We must have the income from our various programs, and like agencies, the Association’s income is down. For example, the income derived from the Association’s E&O program is based upon our own premium volumes. When we are down, the programs are down as well.

The solution to this problem is to increase income and that brings me to the goals I have for our Association in 2010.

The obvious way to increase our dues income is to recruit new members and increase our membership. Having more agents will not only increase our bottom line, but will, more importantly, strengthen our Association benefitting all members. This can be achieved by grass roots effort on our part. Our Association staff will do their part, marketing Insurors, hosting local events and inviting prospects, making agency visits and calling potential recruits. We as agents can help in the process as well. Mentioning Insurors to other agents in your community and asking your company partners if they are Associate Members is a great way for us to grow. The more we grow, the more influence or Association has in the realms of politics and industry support.

Another goal is to increase the number of agents utilizing the Association’s E&O programs, thus

offsetting the decrease in premiums. Insurors offers great E&O programs through solid companies like Westport and Fireman’s Fund. Keep in mind that, just like we tell our insureds, cost shouldn’t be the only factor in determining what you buy. Call one of our staff E&O experts, Paul Pelt or Coit Holbrook, and let them discuss your options in detail.

We must also increase the utilization of the other programs sponsored by the Association, as well as look for other opportunities for the creation of new ones. Insurors and the Big “I” have put together some great opportunities for us to grow our agencies through programs such as: • • • • • •

Big “I” Markets RLI PUPs and Home Business Insurance Preferred Comp Workers’ Compensation InsBank Individual HealthCare Specialists EMC Public Entity

We have to utilize these programs to keep them available. It is certainly cliché, but you only get out of the Association what you put in, and these programs are a great way to contribute and get something back for your agency in return.

Another area we must support in order to keep it going is education. Insurors prides itself on having a strong offering of courses both for designation programs and for current industry topics. Take for example the Workers’ Compensation seminars that were taught throughout the state last year. Getting that information out to all our members could have been difficult if only newsletters and mailings were utilized, but instead our Association staff put together a course and taught it 9 times in 6 different locations. I also know that managing your agency’s staff CE can be a complicated task, but think how much harder it would be without the offerings provided by our Association. Visit the education section of the Insurors website and consider taking a class yourself or recommending some to your staff for 2010.

Convention participation is another one of

“It is certainly cliché, but you only get out of the A ssociation what you p u t i n . . .”

Tee Zerfoss, III 21

All these components help us build an Association that has the resources and capabilities to support our needs as agents.

Each contribution our members make to one of these programs makes them stronger for the next one. So take a moment today and ask yourself the question, “How can I help Insurors, help me?” u TAAG ad_12_07

12/13/07 3:09 PM

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On the expense side, we must pay attention to our folks in the legislature. PAC contributions will be extremely important this year due to the upcoming state legislature and Gubernatorial elections. Having a strong PAC allows us maintain a certain level of influence “on the hill.” Our lobbyists are at their most effective when Tennessee lawmakers are receptive to their input. Maintaining InsurPACTN as an industry leading PAC helps make that possible. Find out more information about the PAC now by visiting the Government Affairs section of www.insurors.org.

A dent gents en

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those “win, win” situations. It not only benefits the Association, but it also brings us together for times of networking and fellowship. The last two conventions have combined to see almost 1,000 attendees and over 120 exhibitors take part in our annual meetings, and we need to keep that momentum going in Nashville this October as we hold our 116th Annual Convention. We have some exciting things in the works for the 2010 event, and we look forward to having more agents attend than ever! Look for more information on the convention in future issues of The Tennessee Insuror.

S in ce 1930

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The Tennessee Insuror

From Your State National Director A Rookie’s First Impressions?

You know - there is a first time for everything! It was my wife Cathy’s and my pleasure to attend my first IIABA Board Meeting as your new State National Director. As one of the 8 “rookies” from across these United States I thought you might want to know my impression of this first meeting.

Cathy and I arrived in Miami to 70 degree temperatures and sunshine after leaving Memphis during a snow storm and temperatures in the 20s and falling. A great first impression – but it didn’t last! By Saturday it was in the low 30s and raining and windy – so much for tropical weather in January!

A reception Thursday night gave us the opportunity to see some old friends and begin to make some new ones. Many Big “I” members, from both sides of the Mason-Dixon line, on your national board made every effort to help us get settled into this new role. Saturday at 7:15 AM they held an orientation meeting to help us rookies grasp all the titles, committees and acronyms. Then, at the end of the day, the IIABA executive committee invited all the “newbies” to attend a small reception held just to give us the opportunity for everyone to get to know each other.

Saturday was a very long day, running from 7:15 am to 6:30 pm with non-stop meetings.

And let me tell you, there is a lot to meet about; your association is involved in many, many areas. What was my impression of my first day of board meetings? The volunteers of this Association are quality people, smart people, successful business men and women – all passionate about our mission statement which is to provide members with a sustainable competitive advantage.

Did you know that your National Association cut about $550,000 out of the budget during this past year to stay in the black? More cuts may very well be needed, but I did learn the finance committee was not afraid to do just that. That is reassuring in an economy where association programs are under-performing just like many agencies were in 2009.

The Tennessee Insuror

Sunday was a day of more of the same with reports from many committees made up of agents, state execs and staff. Yes, the best way to use our national brand initiative, Trusted Choice, is still on the table and there are several new programs now in play and being considered for the future. Certificates of Insurance are still scaring everyone, Healthcare legislation is obviously a hot topic and we still need to get the word out about Virtual University. There is also a very slick new product called the Virtual Risk Consultant – every one of us should own this product – that you can check out right now by visiting the national website at www.iiaba. net/VRC. In summary, my first impression of our national board was eye opening and at the same time reassuring, especially seeing first hand the quality and the commitment of our fellow agents and our hired staff to uphold the Big “I” mission statement.

I have to close with one important note, your Big “I” Political Action Committee, InsurPAC-National, exceeded the $1,000,000 mark for the first time ever with a grand total of $1,006,970.50.

This was in no small part thanks to contributions in 2009 from many of you. You may not like PACs, but we all know locally and nationally that having a strong and well-funded PAC gives us the opportunity to have a voice with our legislators. Tennessee reached its national PAC goal for 2009 with the inspired leadership of Dave Porch, and we hope to meet the mark again in 2010.

“The volunteers o f t h i s Association are... all passionate about our m i s s i o n statement...”

The same Dave Porch, our recently “retired” State National Director, set the bar high in many areas over his tenure and I sincerely thank him for his service to both the Insurors and to our National Association. I hope that I can keep the bar up there as your rookie State National Director.

Thank you for the opportunity to serve you in this position. If you have thoughts our suggestions for me, don’t hesitate to call or send me an e-mail. u

Brad V. Smith 23

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The Tennessee Insuror

From Your CEO Your $5,000 Dues?

$5,000 of benefits per member… ...how does that happen?

Just connect the dots.

One of the great things about Insurors is our ability to leverage the “seed money” known as dues to put in place an array of goods and services for our members.

Your dues, regardless of what dues classification you are, are multiplied by at least 2x to provide you and everyone in your agency with a unique collection of goods and services that no other form of business entity can duplicate.

How does this happen? By getting your dues either annually or in two payments per year we pay your membership in the IIABA, your national association, which in itself leverages those dues multiple times to create their own set of benefits and services.

IIABA provides you with intangibles such as lobbying in the U.S. Congress on your behalf. I know everybody hates Congress, but one thing is for certain, it is not going away. I am most proud of our members of Congress who risked their political lives by supporting the IIABA position on Healthcare.

The Big “I”’s political action committee, InsurPAC-National, cleared the one million dollar mark in contributions in 2009 for the first time since its inception over 30 years ago. This guarantees that IIABA will be a real player in the upcoming midterm elections. If you think the property casualty companies take care of this little chore, then think again. They look for IIABA to provide leadership on pertinent issues, and more importantly, bring folks like you into national issues district by district.

In products and services, IIABA provides you with products that many of you don’t know enough about. Big “I” Markets provides you free access to a growing number of insurance markets. This program is the in-house brokerage firm that has no fees, no contracts to sign,

good commissions and a user friendly website to get it all done. It makes me wonder why every agency isn’t using this program. Your dues are already paying for it, why not use it and utilize those dues even more?

At the state level, your dues get leveraged to provide education courses on a (hopefully) break even basis. We provide, along with our partners, the National Alliance for Insurance Education, QUALITY education that makes you a better agency and helps build the excellent service that your agency wants to provide to your clients. It is not the cheapest CE program you can get but it is certainly one of the best.

Our annual convention continues to impress other states and competitors as one of the premier events in the country. Over the years we have had great entertainment and memorable conventions. The 2010 event will be no exception. But that is not the main reason to be there.

Every agency should have at least one representative at the annual meeting of your Association.

The Convention is about much more than just helping your Association; it is about helping your agency perpetuation. Your lead company today is most likely not the company that is was 10 or 15 years ago. Who knows, you just might meet your lead company of 2020 at this year’s convention. If not, your current lead companies will be there, so shouldn’t you be?

“Why not use it and utilize those dues even more?”

On the products and services side, we leverage your dues to have exclusive opportunities with your errors and omissions coverage. We have represented Swiss Re (formerly Employers Reinsurance) for over 30 years. I have watched companies come and go in this market, but one thing is certain, they all build their business model on Insurors of Tennessee’s E&O program.

If you’re sure your agency will never have a claim, then who insures doesn’t matter. However, what if you do have a claim? Your business reputation is on the line. Who defends you when your reputation matters? You should

Chuck Bidek, CPCU 25

work with our E&O professionals to get your agency the best protection for your business. This is your business’s insurance, for protecting your business, and you should have nothing but the best.

You will be represented in any claims cases by our attorneys who have had many years of experience in Tennessee courtrooms.

Your dues are leveraged many times to bring you the best products in times of need. Preferred Comp/Meadowbrook is another excellent example. Now over ten years old, the product is just as good as ever. Others come and go but we stay in the market through the good and the bad.

with conventions, education, market information, answers to insurance questions and government affairs in Nashville and Washington for approximately $5,000 per year per agency. If you had to pay the real cost for the services available to you, would you? I know that your first reaction to that is, “I couldn’t or wouldn’t do that.” I can only respond that it would be too bad, and not in the best interest of either you or your agency, as well as the insured public to lose these valuable services. The easiest way to maintain those services (the intangibles), which many of our members

have already come to love, is to utilize the products that are made available through both Insurors and IIABA. So, why not connect the dots and be an active participating member of your Association? Give all of our programs (both state and national) a try this year and, when possible, become a regular user.

Then you will be able to leverage your investment in Insurors to its fullest potential.

Your Association staff looks forward to serving you in 2010! u

InsBank, our banking partner, was created for independent agencies. InsBank is your way to secure agency purchases, buy computers, fixtures, buildings and more. Through its real estate affiliate, Finworth Mortgage, you can secure discounted mortgages on both your business and/or your personal home. All employees of your agency have this benefit available to them.

RLI Personal Umbrellas Policies (PUPs) are a great personal lines rounding product which we have supported for more than 20 years. The product is simple to use and is coupled with down-home service form your Association staff. In regards to E&O prevention, you should be discussing PUPs with all of your accounts. You don’t want your insured ever to say, “I didn’t know about that.” RLI also offers a quality Home Business Insurance product that can be a great option for your clients.

On the intangible side, we have no less than 4 registered lobbyists. Two are inhouse employees, while two are “hired guns” who represent you before the General Assembly and the Department of Commerce and Insurance, Department of Labor and Workforce Development and a host of others governmental bodies. We may not always be loved but we are respected.

Without our programs, like E&O, Preferred Comp, RLI, Insbank and Big “I” Markets, and your participation in them, we would only be able to provide you 26

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800.489.7475 501.455.3906 Fax 501.455.3975 ©2009 The Swett & Crawford Group, Inc.

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Education Calendar

The Insurors of Tennessee offers education opportunities to member agents across a wide range of insurance specialities that satisfy individuals at many different experience levels. If you are looking to further your career, seeking a professional designation, or need to satisfy continuing education requirements, check out the variety of courses available.

Registration is fast and easy at www.insurors.org. More information about each class can also be found online.

CISR 3/30 3/31 4/1 4/14 4/15 5/11 5/12 6/22 6/23 6/24 8/25 8/26 11/18

CIC 2/10-12 3/10-12 3/ 4/21-23 5/19-21 6/9-11 9/15-17 11/8-10

Fee: $165

CE: 8

Commercial Property Commercial Property Commercial Property Personal Residential Personal Residential Personal Auto Personal Auto Commercial Casualty Commercial Casualty Commercial Casualty Agency Operations Agency Operations Dynamics of Service

Fee: $395

Kingsport Knoxville Chattanooga Memphis Nashville Knoxville Chattanooga Memphis Jackson Nashville Memphis Nashville Nashville

CE: 24

Agency Management Institute Commercial Property Institute Personal Lines Institute Life & Health Institute Commercial Casualty Institute Commercial Casualty Institute Ruble Graduate Seminar

Nashville Memphis Nashville Nashville Knoxville Nashville Nashville

The Na National Alliance for Insurance Education & Research is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have ďŹ nal authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be addressed to the National Registry of CPE Sponsors, 150 Fourth Avenue North, Suite 700, Nashville, TN, 37219-2417. Website: www.nasba. org. Advanced Curriculum Rating = 20 CPE Credits. For more information regarding administrative policies such as complaint and refund, please contact our oďŹ&#x192;ces at 800-633-2165.

Lunch & Learn 2/25 2/26 4/29

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E&O Seminars 5/27 5/28 8/18 8/19

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E&O Business Practices E&O Business Practices E&O Business Practices E&O Business Practices

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CRM

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10/27-30

Practice of Risk Mngmt.

Sales

Fee: $475

12/8-10

Dynamics of Selling

Flood

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Online Courses (www.iiaba.net/vu) Available from IIABA Virtual University. Member pricing shown.

Ethics for Insurance Professionals How to Calc. Business Income in 5 Min.

CE: 3 CE: 3

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Register Online at www.insurors.org

Indicates course is presented by The National Alliance. Register for these courses at www.thenationalalliance.com 29

We jump through hoops for you. Because you jump through hoops for them.

For more about how Grange can help you help your customers contact: Melinda Beisel at 1-770-823-0820 or beiselm@grangeinsurance.com.

grangeinsurance.com 30 GM-0209-Recrt Hoop 8_5x11 4c.indd 1

The Tennessee Insuror

3/16/09 4:12 PM

Government and Legal Affairs No Horseplay By the Pools

Here are some of the numbers:

Written by Ashley Arnold, Insurors General Counsel In 1985, Tennessee passed a law permitting the first self-insured pools. Currently there are 6 pools still in existence. Over the last few years, much information has been in the state insurance news over the liquidation of the Tennessee Trucking Association Self-Insurance Group Trust and the Tennessee Restaurant Association Self-Insurance Workers’ Compensation Trust.

In 2007, the state liquidated the Tennessee Restaurant Association’s workers’ compensation fund asked about 500 restaurant owners to come up with a $4.8 million shortfall to pay injured workers.

Insurance agents still have the ability to access pools as an alternative to traditional insurance carriers, but should be aware of the risks associated with pools. Unlike an insurance company, pools are membership based with the idea that each member is jointly and severally liable for the actions of the other members. Additionally, as was seen in the two cases mentioned above, the members were ultimately held financially responsible when large losses were not able to be paid from the pool’s reserves.

If a pool becomes insolvent, or if it is unable to pay its outstanding lawful obligations as they mature in the regular course of business, then the Commissioner of Insurance can liquidate the pool and levy an assessment upon its members for the total amount determined to be necessary to pay all the liabilities of the group.

The Department rules state, “each pool shall enter into indemnity agreements with its members jointly and severally binding the pool and each member thereof to meet the financial obligations of the pool.” Tennessee Comp. Rules & Regulations Chapter 0780-01-54-.04(3)(d).

On liquidation, the statute allows the Chancery Court of Davidson County to levy assessments against all members of the pool, which amount shall be not only the outstanding liabilities, but also the cost of collection. It is important to note that if the members do not pay the amount assigned to them by the court, the members can be brought to court, and a judgment may be entered against them for the outstanding amounts.

A real life example of the court finding judgement for the outstanding amounts took place in the case of the Restaurant association. Members of the Restaurant pool were assessed not once, but twice, for outstanding amounts.

The Tennessee Insuror

restaurant association assessments example

1st assessment

2nd assessment

total assessments

#1

$8,924.11

$25,797.61

$33,721.72

#2

$4,625.80

$17,192.99

$21,818.79

#3

$8,191.89

$29,472.29

$37,664.17

#4

$21,300.56

$67,592.70

$88,893.26

#5 $19,428.11 $54,810.30 $74,238.41

On the agent side of the equation, it is important to provide your insureds with the proper notices before placing them in a self-insured pool. As the rule states, the members must sign an indemnity agreement before joining a pool, and you should be sure to notify the insured that the Tennessee Guaranty Fund does not apply to self-insured pools.

Why is that important you say? Well, if the pool fails, there is no state fund to help pay the losses and therefore the members will be left as the ones to pay the claims. Your insured will look to you to answer hard questions regarding why they were in a pool, and not placed with a traditional company. Remember, insurance agents have a duty to be knowledgeable about where they recommend their insureds purchase coverage.

Errors and omissions underwriters routinely seek financial data on pools because any arising claims could be significant.

Pools must file certified financial reports with the Department of Commerce and Insurance. In 2000, the Insurors published the then public financial data, and as a result, representatives from certain self-insured pools recommended legislation, which later became a law, making the financial reports confidential. As of today, the pool financial reports remain confidential and are not accessible under the open records act.

Most pools will reportedly provide financial information upon request of prospective members. Insurors recommends that prior to placing a risk with an eligible pool, you seek updated certified financial reports from the pool.

Misrepresentation

Written by Lee Hunt, Senior Vice President of Swiss Re Claims arising from misrepresentation can result from a misunderstanding by the policyholder concerning coverage, reporting requirements, perception issues, or their misinterpretation about what is written in a proposal or letter or verbally communicated to them.

31

Common claim causes are: •

Utilize carrier provided coverage summaries and explanations of coverage or procedures rather than developing your own if such are available

Customer alleges that what they asked you to cover was not covered when the loss occurred

•

Spend the time needed to explain complicated coverage forms or reporting procedures

•

Customer surprise that their policy is auditable or has the potential for an additional premium from the audit or reporting form

•

•

Customer alleges was not properly instructed on what is covered by the policy or endorsement

Document all phone conversations immediately, keeping a phone log of all business calls received INCLUDING all offsite cellular phone conversations. Use a standardized telephone memo or call sheet

•

Retain fax transmission verifications with original documents AND maintain records of fax transmissions

•

Time and date stamp all incoming mail and have it reviewed by senior staff immediately

•

Train staff on phone contacts, what to say and how to say it including after hours voicemail. Use language similar to: “Please be aware that coverage cannot be bound or altered via this voicemail.”

•

If a message is taken for another, ensure the caller does not assume the request or issue has been resolved.

•

Respond in writing to customer queries whenever possible to confirm what is said verbally

•

Do not represent yourself to be capable of giving legal, engineering, human resources, tax, accounting or other professional advice

•

Save all business related e-mails and correspondence in the customer file

•

Implement a procedures manual that addresses at least all basic procedures so as to ensure consistency in the handling of work items. Update it at least annually with your staff

•

Audit files on a regular schedule to confirm that proper procedures are being followed by all staff

•

Conduct regular training sessions with your staff

•

“You told me something different than what actually happened”

•

•

Customer alleges erroneously told by the agent what is required in the event of certain occurrences such as claims, payroll reporting, audits, and other procedural issues.

Therefore, what can an agency do to assist in the prevention of policyholder misunderstandings and allegations after the fact that do not fit the facts as the agency sees them?

DOCUMENT, DOCUMENT, DOCUMENT!!!

Can you as an agent PROVE what was said, done or proposed to a customer months or even years after the fact when a customer suffers a financial loss and alleges it was due to an agency error or omission or misrepresentation? Memories grow hazy over time combined with the temptation by a customer to make allegations against an agent when the prospect of financial loss threatens the future of their business or personal wellbeing. Consider the following: •

•

Don’t oversell your agency or services on your website, in your proposals or in your marketing materials. Avoid vague or all-encompassing promises. Do not lead the customer to expect a level of expertise that holds the agency to a higher standard that an agent normally would be held.

Use checklists and applications to bring coverage needs to a customer’s attention.

•

Use form letters to document all phases of the insurance process from instructions in handling to documentation of both positive and negative topics.

•

Use written proposals and quotes to clearly document and describe the transaction.

•

Use standardized language in proposals and quotes. If you provide highlights of coverage and exclusions include a statement to clarify your intent such as something similar to the following: This proposal contains a brief outline of coverages to be included in the policy that may be issued in the future. This is only a summary, and the terms and conditions of any policy will take precedence over the proposal. You must read your policy.

•

32

Insist the customer read their policy if you do not review it with them

Finally, BE CONSISTENT in the use of any or all of the above procedures. If you do it for one customer, then do it for all of them!

Back to the Wild, Wild West

Written by Ashley Arnold, Insurors General Counsel Have you ever heard the saying, “you can’t make this stuff up?” Do you remember life before PC1041? If not, then this example from the Court of Appeals should serve as a good reminder.

Here are the facts: 1. A roofing contractor applied for workers’ compensation insurance declaring in his application that he had no employees.

The Tennessee Insuror

2. He paid the $750 minimum premium and the insurance company issued a policy.

those subcontractors are independent contractors because they are “statutory employees.”

3. Insurance audit requested information about subcontractors he used. He refused to answer.

Remember, the Court has long held that the principal contractors have it in their power to choose responsible, insured subcontractors.

4. Insurance company cancelled the policy for failure to provide underwriting information.

5. Worker (one of his “independent contractors”) is injured and treated at the hospital.

6. Mr. King turns the claim in to the insurance company.

7. Insurance company denies claim.

8. The audit assessed an additional premium of almost $15,000 for roofers who worked under contract with him or his subcontractors who did not have policies.

9. The audit showed Mr. King employed two workers and a Mr. Munoz, who also brings helpers with him to do the work.

All workers were paid per each square of roofing completed.

10. Mr. King did not pay workers’ compensation, income taxes or social security on the workers.

11. Mr. King did not set work hours, did not provide tools, and did not tell anyone how to do the job. He also testified he was “almost never” at the jobsite.

12. The contractor was sued by the insurance company to collect the premium.

13. At trial the contractor testified that all of the workers were independent contractors and he had NO employees. Here is the exchange: •

Q: “…you use laborers to do the work, the actual roofing work, correct?”

•

A: “I use independent contractors.”

•

Q: “And it’s your position that everyone who does work for you is a subcontractor, correct?”

•

A: “Yes, everybody that does work for me is an independent contractor.”

Not surprisingly, the Court applied the same workers’ compensation law that has been in effect for years in Tennessee, stating that the five person limitation does not apply to the construction industry perhaps because of dangers arising in construction trades and small contractors employ fewer than five workers. It noted that the employer may be liable for injuries sustained by employees of his subcontractors even when The Tennessee Insuror

The appeals case turned on the policy language that stated the premium was based upon remuneration to Mr. King’s employees and to “all other persons engaged in work that could make us liable under the policy.” The court noted that obviously this language was included because of the statutory employer liability established in TCA 50-6-113.

It was the insurance company’s position that if a worker for Mr. King or his subcontractor was injured, the insurance company would have had to defend against the claim and bear the risk that the worker would be found to be a statutory e m p l o y e e . Since Mr. King submitted the claim for the injured worker, the Court noted that the insurance company’s argument was indeed accurate.

The burden of proving that a worker is an independent contractor rests on the employer, and if there is any doubt, the Court will hold the worker is an employee. Further, the law states that no contract or agreement shall in any manner operate to relieve any employer of any obligation under the Workers’ Compensation law.

Finally, the Court held that it was clear Mr. King wished to avoid the expense involved in furnishing workers’ compensation insurance for roofers who worked on his jobs, even though he was required by the general contractor to provide the insurance. To achieve the end of low premiums, he first stated he had no employees, did not use subcontractors, and did not sublet without proof of insurance. He claimed a remarkable degree of non-involvement with the work for which he was getting paid, and for which he was paying others to perform. The court declined to allow him to use such a ruse to avoid workers’ compensation liability.

In the end, the court required Mr. King to pay the audited premium for the exposure of the insurance company.

What should you do as an agent? Under the “new” or should we say “old” world that we now live in, if you insure general contractors, or anyone who hires subcontractors, make sure that they obtain evidence of insurance from everyone on the job.

This is the only sure way that you can protect your insureds from any audit surprises that could turn up later on down the road. u 33

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Available for purchase exclusively to Big “I” members over the counter at www.iiaba.net/VRC. Big I Advantage® Virtual Risk Consultant 34

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The Tennessee Insuror

Association Update

E.B. Thoma & Son Agency Celebrates 100 Years

has continued to grow the agency, and also followed in another family tradition by becoming the Insurors President in 2007.

In 1910, Eldon B. Thoma started what has now become one of the oldest independent insurance agencies in the state of Tennessee. The agency already holds the title of the oldest continuously operated insurance business in Tullahoma.

Now the agency celebrates their first 100 years and looks forward to what their agency’s future holds. The anniversary celebration began with the sponsoring of a Tullahoma Chamber of Commerce coffee, and will continue with events throughout the year.

Eldon Thoma

Jack Thoma

Busch Thoma

Eldon ran the agency until his death in 1955.

His son, Eldon B. “Jack” Thoma, II, joined the agency after World War II and became part owner in 1947. He took over after his father’s death and continued his father’s legacy. In 1974, his own son, Busch, joined the agency as well. During his time as agency principal, Jack was very active in Insurors and served as President in 1983. He was named Insuror of the Year in 1987, two years after Busch received the same honor.

In August of 2004, Jack passed away, leaving Busch to maintain the family business. Busch

Willis Appoints Eggleston and Others to Mining Practice Team Willis Group has made several staffing changes to its Mining Practice team in Knoxville, including naming Jeffrey Eggleston as Senior Vice President. With over 27 years of experience, Eggleston has worked in all facets of mining insurance, including placement, design and administration of mining coverage programs.

Other staff recently added to the team included Michael Ford, also a Senior Vice President, and Cheryl Vandermosten, a Vice President. u

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The Tennessee Insuror

Broker Spotlight

Crump Insurance Services Crump Insurance Services (Crump P&C) is the nation’s largest insurance wholesaler and a prominent leader in Brokerage, Programs and MGA. But size is not their only distinction – they offer extensive market access and significant in-house authority. Crump P&C offers solutions for the large complicated account as well as the smaller commercial account while most wholesalers focus on one or the other.

Crump’s nationwide presence, plus a Bermuda location, gives them broad geographic scope along with knowledge of the local/regional marketplace. With 19 brokerage offices across the country, a Crump P&C office is always within easy reach. In addition, they provide simplified E&S filings through a national licensing platform. They have immediate access to more than 100 leading domestic and international markets and the volume of business they place gives them extraordinary leverage.

Crump features exclusive brokerage and underwriting arrangements, wholesale only markets, established MGA facilities, and numerous specialty programs.

Crump P&C also contains a powerful infrastructure. Their technology platform allows them to create solutions to meet the

information needs of partners such as customized reporting.

Their imaging system enables paperless transactions from submission, to bind, to claims and recordkeeping. Account and policy documentation is converted to paperless format allowing quick access to all records.

Crump P&C has industry leading specialists in virtually any class, from the simple to the complex and in markets from standard to E&S, allowing them to meet virtually every placement need their retail partners may have. Many of their brokers have carrier side underwriting backgrounds and the average broker tenure is over ten years. Whether exclusive program development, specific industry expertise or operational support, Crump makes our partners more effective for their customers.

Operating under an open architecture supports a strong emphasis on teamwork. Seamless service is provided across their “One Crump Network,” in that any broker can act as your single connection point to all of Crump P&C’s products, capabilities and resources.

Imagine what One Crump can do for you. u

Difficult times call for innovative solutions We hear you.

Crump is an innovator in bringing new products and services to our customers.

As the nation’s largest insurance wholesaler, we have the breadth and depth of market access and relationships to deliver solutions under virtually any conditions. Our brokers and underwriters work seamlessly with retailers and their clients to tailor a risk management strategy to the individual account.

Imagine what One Crump can do for you

For more information Memphis 5865 Ridgeway Center Parkway, Suite 200 Memphis, TN 38120 800.26.CRUMP Toll Free 901.255.6161 Phone 901.255.6131 Fax MemphisSubmissions@crumpins.com

www.crumpins.com

Crump Insurance Services is part of Crump Group, Inc., the nation's largest insurance wholesaler Ranked #1 Insurance Wholesaler by Business Insurance Magazine

Property

The Tennessee Insuror

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■

Casualty

■

Financial

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Services

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Wholesale Brokerage

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MGA

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Specialty Programs

37 9/18/09 1:56:28 PM

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The Tennessee Insuror

Company Spotlight

Grange Insurance

Independent agents face a host of challenges. Now that you have a website, the world has already moved on to Twitter, Facebook, iPhone apps, etc. It should be reassuring, then, to find an organization that can help you keep up with our fastpaced world while remaining committed to its mission.

A Special Relationship

Grange Insurance has developed a new brand designed to harness the power of the new Middle America. This isn’t a geographic or demographic group, but rather a way of relating to people and helping them with their insurance needs in the way they live their lives today. Yet Grange remains true to its heritage: A stable organization based in America’s heartland that offers competitive pricing, outstanding claims service and the expert counsel of its independent agent partners.

Agents have appreciated Grange’s ongoing commitment to EODB® (Ease Of Doing Business), the company’s core business philosophy for the past 10 years.

Another central tenet of the Grange brand is to extend the EODB philosophy to all its customers. Part of this is already evident in an upgraded website, GrangeInsurance.com, that allows customers to view policies, print ID cards, monitor a claim and pay bills online. Additional upgrades are also in the works.

“We began the rebranding process by looking at our company from different perspectives to get a better idea of where we’ve come from, what we do well, what we can do better and who we want to become,” said Phil Urban, Grange’s retiring president and CEO, who is leaving after 11 years of leadership. “What we’ve developed is a new brand that appeals to a wider range of customers and agents.”

New president and CEO Bob James came to Grange because he saw a thriving, successful company and wanted to build on its success.

“Phil and his management team have built a strong, financially sound company that is committed to the independent agent distribution system,” said James. “As a former agent myself, I can assure you that I understand the value of what an independent agent provides to a client. I have walked in their shoes and appreciate the challenges they face each day.”

The Tennessee Insuror

Grange’s unique relationship with its independent agent network differentiates it in the marketplace. A cornerstone of the Grange brand is to position the independent agent as a trusted local advisor about a complicated product.

More Ease of Doing Business Another great example of EODB to customers is found in Grange’s claims service, which is evident in the 96 percent claims satisfaction survey of all Grange claimants.

“Customers find our claims process simple, efficient and quick,” said Chief Claims Officer Peter McMurtrie. “A great example is our turnaround time when the winds of Hurricane Ike took their toll in the country’s interior. Not only were we often the first insurance company on the scene, but we settled 90 percent of policyholders’ claims within 30 days of the hurricane. This is the type of service our customers and agents have come to expect from Grange, and it’s something that we’ll always take very seriously.”

Agents looking for a strong partner committed to EODB, superior claims service and looking to service customers the way they live their lives today should contact Melinda Beisel, Grange Regional Manager, at 770.823.0820. u

Tennessee Contact Melinda Beisel Tennessee Regional Manager beiselm@grangeinsurance.com 770.823.0820 Company Information Grange Insurance, with $2 billion in assets and $1.3 billion in annual revenue, is an insurance provider based in Columbus, Ohio. Through its network of independent agents, Grange offers auto, home, life and business insurance protection. Established in 1935, the company and its affi liates serve policyholders in Georgia, Illinois, Indiana, Iowa, Kentucky, Michigan, Minnesota, Ohio, Pennsylvania, South Carolina, Tennessee, Virginia and Wisconsin. For more information, visit www. grangeinsurance.com.

• •

•

•

• •

Rated A (Excellent) by A.M. Best Ranked #83 in the Information Week 500 listing of the most innovative users of business technology in the country across all industries.

Also listed as one of 20 companies with “Great Ideas to Steal” Received the 2009 Applied Systems Interface Partnership Award and the 2009 ACORD Commercial Lines Download Award Delivered industry-leading new agent training, which helped increase new agent new business by 95 percent over 2008 Continued to seek and implement feedback from its Agent Advisory Board on improvements Invested in technology to help call center staff identify, track and quickly respond to customer issues 39

trust. acuity.com

40

The Tennessee Insuror

Company Briefs

Grange Insurance Wins Interface Partner Award

mit since 1999 but retired this January.

Grange Insurance recently received the 2009 Interface Partner Award from insurance technology company Applied Systems.

The award recognizes Grange’s achievements in agency-carrier communication.

Prior to her appointment, Ms. Sipe had been the company’s Senior Vice President and General Manager of Operations since 2006. A Lakeland, FL native, and a graduate of Florida Southern College, Sipe joined Summit in 1989 and has held several key management positions.

Applied Systems acknowledged Grange’s leadership and innovations, citing the carrier’s commitment to providing agents with download, real-time inquiry and real-time rating.

“Grange is thrilled to be recognized again by Applied Systems for our support of agency technology that makes working with Grange easy for our agents,” said Sherri Rarey, assistant vice president of agency interface for Grange Insurance. “Our support of industry real-time processes represents our commitment to the success of the independent agency distribution system. We value the opinions of our agents and that’s why we continue to develop the technology they need to continue to be a vital part of the insurance buying and servicing experience. We love being able to contribute to their success, now and in the future.”

Grange Insurance received the partnership award during a ceremony in Kansas City, Mo., at the 2009 Technology, Education & Networking Conference (TENCon) hosted by ASCnet, the Applied Systems Client Network.

Kane Named as United Fire Manager for TN United Fire Group recently announced that Production Marketing Representative Pat Kane, a nine-year member of United Fire Group, has been promoted to marketing manager of their Great Lakes region, which includes the states of Alabama, Florida, Illinois, Indiana, Kansas, Minnesota, Nebraska, Tennessee and Wisconsin.

Pat joined United Fire Group in 2000 as a marketing representative for the state of Iowa and has more than 20 years of insurance marketing experience.

Hodges Retires; Sipe Named as New President and CEO of Summit Liberty Mutual Agency Markets, a strategic business unit of Liberty Mutual Group, announced that Carol Sipe has been appointed as President and Chief Executive Officer of Summit, which provides monoline workers’ compensation coverage in ten southeastern states, including Tennessee. Ms. Sipe succeeds Rick Hodges, who led SumThe Tennessee Insuror

Under Hodges’s leadership, Summit more than doubled its premium under management and expanded operations in the Southeast. He was the first chairman of the Workers’ Compensation Advisory Council for the Florida Division of Workers’ Compensation, and is a current member of the Board of Directors for the Florida Workers’ Compensation Joint Underwriting Association.

ACUITY Annual Report Garners Gold Award ACUITY’s 2008 Annual Report earned a Gold MarCom Award from the Association of Marketing and Communication Professionals, the international organization consisting of thousands of advertising, public relations, and media production professionals.

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Log on today to fish for E&O claims frequency data, real-life case studies and analysis, sample client letters, sample agency procedures, agency E&O self assessments, podcasts on important E&O topics, and much more.

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Visit the E&O Risk Management website at www.independentagent.com/eohappens 41

The MarCom Awards represent the world’s largest international competition for the concept, writing, and design of marketing and communication programs and materials.

“The MarCom awards are judged by marketing professionals who are looking for creativity, resourcefulness, and overall excellence,” says Ben Salzmann, ACUITY President and CEO. “We are honored to receive a MarCom Award for our Annual Report.”

More than 5,000 entries from both U.S. and foreign firms were evaluated in this year’s competition. “MarCom winners include huge media conglomerates, Fortune 500 firms, and businesses whose advertising budgets dwarf ACUITY’s,” says Wally Waldhart, ACUITY’s Vice President - Sales and Communications. “Winning a Gold MarCom award puts us among elite company.”

ACUITY’s 2008 Annual Report was designed as a collection of “World Records.” The full-color, 52-page report was produced in book form, including a hard-cover binding. Additionally, all ACUITY employees participated in production of the report by setting the Official Guinness World Record for the Largest Gathering of People Dressed as Waldo. This achievement is also featured in the recently published Guinness World Records 2010: The Book of the Decade.

Johnson Calls it A Career Clyde Johnson, a former Field Representative for Jaeger + Haines has retired after 50 years of calling on Tennessee agents.

Johnson, who started his career with Maryland Casualty Company in 1960, worked with Aetna for 28 years before moving to Jaeger + Haines in 1988. His insurance career was spent almost entirely working in the state of Tennessee.

Beisel Promoted to Assistant VP, James Named President at Grange Grange Insurance announced recently that Melinda Beisel has been promoted to the position of Assistant Vice President, and Robert V. James has been named President and Chief Executive Officer of the Columbus, Ohio, based insurance provider.

In her new position, Beisel will oversee field sales and agency operations for the Georgia, Tennessee and Kentucky districts.Since joining Grange in 2000, Beisel has served as a regional and territory manager in the Atlanta area. Prior to joining Grange, Beisel was an assistant vice president of sales and marketing with Southern Heritage Insurance Company, and has held several other underwriting and sales positions within the industry.

“We’re excited to announce Melinda’s well-deserved promotion,” says Doug Sharp, vice president of agency relations. “She has done an outstanding job of helping to grow our business in the region, and I know she’ll continue to help us achieve our 42

business goals. She’s truly an asset to the Grange team.”

Beisel, a Certified Insurance Counselor (CIC), has an MBA from Berry College and is a member of the Certified Professional Insurance Women and the National Association of Insurance Women. She currently resides in Suwanee, Georgia.

Robert James took over as the new President and CEO in January for Grange. Retiring President and CEO Phil Urban is currently serving in an advisory capacity until February 26th to ensure the company has a seamless transition of the job’s responsibilities.

“On behalf of the board, I’m excited to welcome Bob to Grange,” said Michael V. Parrott, Grange Mutual Casualty board chairman. “He brings a wealth of diverse industry experience, a high level of executive professionalism and inspiring leadership skills to our company. I’m confident in Bob’s ability to successfully lead Grange and engage our independent agent partners to aggressively grow the organization.”

Bob has more than 36 years of experience in property and casualty insurance with companies such as Allstate, AIG, MetLife and CNA. Most recently, he held the position of senior vicepresident of mortgage operations and insurance executive at Bank of America, where he managed the bank’s consumer insurance, commercial insurance and reinsurance operations.

Since July 2008, he has improved the company’s net income by $75 million. Prior to joining Bank of America he was the vice-chairman, president and CEO of Countrywide Insurance Group.

“I’m thrilled to join Grange Insurance, recognized in the industry as a great company with an unwavering commitment to the independent agent distribution system,” said James. “As a former agent, I have sold insurance across the kitchen table, at the diner over lunch and on the factory floor, so I understand the important role Grange independent agents play in the lives of their customers while contributing to the success of the company. I’m looking forward to building on that success.”

According to James, Grange’s solid financial foundation will allow the company to develop new product offerings and continue to provide excellent service and quick claims resolution.

New Anderson Report Helps With Agency Management System Selection “Streamlining is the key, but agencies need to stay up on technology to compete,” says Steve Anderson of The Anderson Agency Report. Anderson recently introduced a special report to aid agencies in the evaluation and selection process of agency management systems. The Anderson Report on Agency System Selection (available at www.AgencySystemSelection. com) walks agencies through the process, reviewing the specific technology-vendor options available for firms of any size.

The Tennessee Insuror

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Builders Mutual Goes Green

QBE Names Sheinheit as Chief Strategy and Tech Officer

Builders Mutual Insurance Company is proud to announce that it is going green!

Steven L. Sheinheit has been appointed chief strategy and technology officer for QBE’s Americas Division. He will lead the strategy and technology team, which will develop and execute corporate and business strategies and deploy technologies across the company.

Research began in May of this year to determine what the company could do to begin a green campaign. “Our goal was to create an environmentally responsible culture within the Company to demonstrate that small changes can make a big difference. Many of our customers are shifting towards green building initiatives, so it seems natural that we would implement a similar culture internally,” stated John Boggs, President and CEO. A “Green Committee” was established and in the last six months the company has successfully: • • • • • •

Increased recycling of bottles, cans and plastics in break room Increased the amount paper that is recycled (instead of placed in trash cans) Reduced the amount of paper printed by cutting down on cover sheets and implementing Double-sided printing Eliminated the purchase of Styrofoam cups Encouraged the use of reusable mugs and cups

Sheinheit has extensive experience in insurance and financial services. He served as executive vice president and chief information officer at MetLife, where he was responsible for information technology worldwide. Before that, he was executive vice president and corporate chief information officer at Chase Manhattan Bank.

He holds an MBA in operations research from Baruch College in New York and a bachelor’s degree in computer science from City College of New York School of Engineering. He is also a graduate of the Harvard Advanced Management Program.

Travelers Launches Catastrophe Awareness Initiative Travelers, acting through their Travelers Institute, recently launched an ongoing initiative to promote and raise awareness of catastrophe readiness. As part of this initiative, The Institute hosted the Partnership on Mitigation Summit, convening a panel of experts to discuss strategies for making homes more resilient. At the summit, The Travelers Companies, Inc. announced a pilot program to write insurance policies in certain states along the Atlantic and Gulf coasts for homes meeting established standards designed to resist the impacts of tropical storm and hurricane winds. Qualifying homes will be eligible for a 35 percent hurricane premium credit.

On November 18th of last year, the company hosted an “Ugly Mug” swap. Employees were encouraged to donate coffee mugs from home; these mugs are now being used by employees in place of styrofoam cups and community mugs are also available in break rooms. During the mug swap, more than 66 employees (including those pictured below)

took the Builders Mutual Green Pledge to go green both in the office and while at home.

Camille’s Sidewalk Café, a local eco-friendly catering service, provided breakfast for the event.

44

The Tennessee Insuror

Plug in to the power

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Big “I” Markets is the independent agent’s gateway to specialized insurance products and services with no access fees, no volume commitment, and no software needed beyond basic Internet access.

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Big “I” Markets is exclusively available to IIABA members. For more information and to download a regsitration kit, visit www.independentagent.com/BigIMarkets.

Why is it revolutionary?

With highly rated, handpicked insurance providers, a robust product line, detailed underwriting guidelines, streamlined applications, sales tools and direct company submissions at your fingertips, your agency will be well on the way to explosive revenue potentials. This cutting edge technology will give you, the independent agent, the ultimate competitive edge.

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“Homes built to meet these stringent standards are better able to withstand severe weather, reducing property losses and saving lives, and we want to promote and raise awareness of these smarter building practices,” said Eric Nelson, Travelers Vice President, Personal Insurance. “Building stronger homes is a key principle of the Travelers Coastal Wind Zone Plan, our proposal to improve the availability and affordability of catastrophic wind coverage in communities along the Gulf and Atlantic coasts. We hope this initiative and meaningful premium credit will encourage homeowners, builders and building officials to adopt these disaster resistant standards.”

InsBank Names Rieniets President and CEO Insurors banking partner InsBank has named current President, James H. Rieniets, Jr., as Chief Executive Officer (CEO). Rieniets will also continue to serve as the President while former CEO, Michael A. Qualls, will continue as InsBank’s board chairman.

As the CEO, Rieniets will be responsible for the overall direction of the bank, as well as providing leadership and strategic guidance. Additionally, he will continue to manage the day to day operations of the bank.

“I’m excited about the opportunity to lead InsBank in the new decade,” said Rieniets. “Mike has been a tremendous leader for our organization. Under his direction, InsBank has developed from a branchless banking concept, steadily growing over the past nine years, including the most recent year when InsBank grew average deposits nearly 20%. I look forward to continuing our work together as he chairs our board. Our goal is to continue providing our clients with exceptional service by offering a secure place for deposits and competitive lending solutions complemented with the unmatched personal service and expertise of seasoned bankers.”

Rieniets, one of InsBank’s original employees when it was founded in 2000, boasts an extensive 19-year banking career. He originally served as InsBank’s chief lending officer, and was promoted to president in 2007. Prior to joining InsBank, he was with National Commerce Bancorp in Memphis.

Rieniets has also been active with the Tennessee Bankers Association having served as Chairman of the TBA’s Credit Committee.

Qualls, who served as the original CEO and President of InsBank, will be devoting time to business development while continuing to participate in all bank committees and boards. He has three decades in the banking and finance industry and prior to joining InsBank he served as president of American Savings Bank in Livingston.

“It’s been an absolute pleasure to serve as CEO of InsBank,” said Qualls. “This company is what we’ve strived for since day one because of the unique model and the amazing banking 46

professionals who implemented it. Working with Jim and the others, we built InsBank to blend the personal banking approach of the past with today’s high-tech solutions. Jim and the team will continue cultivating our treasured client relationships and provide a clear vision for continued growth and success.”

The Hanover Names Bensinger as Exec. VP The Hanover Insurance Group, Inc. recently announced the appointment of Steven J. Bensinger as Executive Vice President and Senior Financial Officer. Bensinger joined The Hanover on January 6th and will be appointed CFO in March, replacing Eugene M. Bullis, who will retire later this year.

“We are very pleased to have Steve join our team,” said Frederick H. Eppinger, chief executive officer at The Hanover.

“He is an extremely talented and seasoned financial executive with extensive property and casualty experience. We are confident we will benefit from his many years of experience as we continue to position our organization to compete and win over the long term.”

Bensinger has more than 30 years experience in the financial services business, with most of it in insurance, and in particular, property and casualty insurance. He began his career in 1976 with Coopers & Lybrand, where he rose to partner in the firm’s financial services practice. In 1987, he joined Skandia America Corporation as senior vice president and chief financial officer, and later was named president and chief operating officer.

Bensinger held senior leadership positions at Chartwell Re Corporation, Trenwick Group Ltd., and Combined Specialty Group, Inc., from 1993 to 2002, before joining American International Group, Inc. as vice president and treasurer in 2002.

He was appointed executive vice president and chief financial officer in 2005.

Johnson & Johnson Acquires Sunbelt G. A. Johnson & Johnson, a family-owned managing general agency, has announced that it has acquired the Sunbelt General Agency from American Modern Insurance Group. Terms of the agreement were not disclosed.

A subsidiary of American Modern Insurance Group since its inception in 1994, Sunbelt General Agency is a full service managing general agency based in Montgomery, Alabama.

In addition to writing products with the insurance companies of American Modern Insurance Group, Sunbelt also has an inhouse insurance brokerage division and a premium finance division, Sunbelt Premium Finance.

“Bringing this agency into the Johnson & Johnson fold provides us with a significant opportunity to expand our reach into the Alabama and Mississippi region served by Sunbelt,” said Francis Johnson, President of Johnson & Johnson. All of the current Sunbelt employees will be retained. u The Tennessee Insuror

The Tennessee Insuror

47

The Real Time 21 Day Challenge Take Part in the National Initiative to Experience Real Time

The all-industry Real Time/Download Campaign recently rolled out a major new nationwide initiative—the 21 Day Challenge—for independent insurance agencies that have not yet implemented Real Time rating and inquiry workflow or that want to broaden Real Time usage for their employees.

The Challenge is built on the broadly accepted premise that it takes 21 days to break old habits and form new ones. In the case of insurance agencies, even if a new workflow saves time and reduces keystrokes—as Real Time has been found to do— it takes some time for employees to become fully comfortable with new processes and to learn how to use them most efficiently.

Real Time is the ability to click on a button from a client file in the agency management system or comparative rater for immediate access to carrier information on that client. This approach provides a single workflow for servicing or quoting.

The Real Time 21 Day Challenge gives agencies step-by-step guidance in how to implement Real Time and broaden its usage through a Web site—www.getrealtime.org/21dc. Agents will have options in taking the Challenge, depending upon where the agency currently stands with the functionality. A “Champions Challenge” allows selected employees go through the Challenge first and then bring it to the full agency in an “Agency Challenge,” where all employees take the Challenge together. If the agencies need to install Real Time functionality, they can click the button “New to Real Time” for a preliminary walk-through on getting started.

As agencies begin one of the challenges, they should register on the site so campaign supporters can reach out to them to provide support if needed, say campaign officials. Carriers and vendors are ready to answer questions that may arise as individuals and agencies take the challenge.

The initiative was designed to recognize successful completion of the challenge, which occurs when: 1. Real Time has become the predominant workflow for the agency (for those carriers and transactions where it is offered); and 2. The new workflow has a positive impact in the agency.

Agencies will receive a certificate acknowledging their successful completion when they finish the full Agency Challenge.

48

National, state and local agent associations and user groups that want to drive broader 21 Day Challenge participation among members may contact Dave Willis at dave@Aartrijk. com or (603) 444-2225.

The 21 Day Challenge was piloted last year by independent agents in Iowa and New York.

About the Real Time/Download Campaign Launched in April 2007, the Real Time/Download Campaign (www.getrealtime.org) is dedicated to improving the competitiveness of the independent agency system distribution channel.

The campaign—supported by independent agents, trade associations, carriers and technology providers—isn’t advocating a specific technology, but rather a workflow approach that frees up more time for agencies to sell, process and service business. Most agents can leverage tools that are already contained in their agency management systems or comparative raters.

Real Time is the ability to click on a button from a client file in the agency management system or comparative rater for immediate access to carrier information on that client. The transaction may be a quote, billing inquiry, claim inquiry/loss run, policy view, endorsement or a request for information. Most-recent numbers show more than 20,000 real-time transactions are performed industry-wide each business day through agency management systems; this figure excludes real-time rating transactions processed by comparative raters.

The campaign’s goal is to double the number of real-time transactions each year.

Campaign participants include agents, brokers, carriers, technology providers, user groups, and agent and industry associations. The campaign is led by industry groups and sponsored financially by: ACORD User Groups Information Exchange (AUGIE)/ACORD; Agents Council for Technology (ACT)/Independent Insurance Agents & Brokers of America; Allied Property & Casualty Insurance/Nationwide; AMS Users’ Group (AMSUG); Applied Systems; Applied Systems Client Network (ASCnet); Artizan Internet Services; EMC Insurance Companies; Grange Insurance; Harleysville; IVANS; Liberty Mutual Agency Markets; MetLife Auto & Home; Strategic Insurance Software (SIS); The Hartford; Vertafore; and Westfield Insurance. u The Tennessee Insuror

2010 Young Agents Day on the Hill A Behind-the-Scenes Look at the Tennessee General Assembly

The 2010 Young Agents “Day on the Hill” has been set for Tuesday, March 23rd. This year’s participants will be able to tour the legislative plaza and get a behind-the-scenes look at some of the interworkings of our state government.

The event will begin with a lunch at 11:30 am, and speakers will address the group about the role of the Association in government affairs, and the importance of agent involvement in insurance-related legislation.

The group will then make their way to the legislative plaza, where they will get a brief tour of the building and then sit in on a committee meeting to witness the General Assembly in action. Afterwards, some special guests will address the Young Agents about their roles in the legislature and how they work with the Insurors lobbyists, as well as the Department of Commerce and Insurance, to determine what the areas of concern are in state insurance law.

The Day on the Hill is also a great way to get Young Agents in your agency involved in the Association, and for them to get a better understanding of the impact of the legislative process on our industry. All Young Agents (any industry employee who is under 40 years of age or has been in the insurance business for less than 5 years) are encouraged to attend.

Last year’s event saw almost 20 Young Agents take part and we want to maintain that momentum for 2010.

The registration fee for this informative event is only $25, and you can register online now by visiting http://www. insurors.org/source/Meetings/cMeetingFunctionDetail. cfm?section=PDS&product_major=YAD10&functionstartdisp layrow=1 or by following the Young Agent icon link on our homepage.

If you’d like more information on the Young Agents program, please e-mail us at info@insurors.org. u

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49

50

The Tennessee Insuror

Meetings

Full Calendar Ahead for 2010 Big “I” 2010 Legislative Conference & Convention Legislative issues are certainly top of mind in the independent agency community. InsurPAC-National, the Big “I” political action committee, achieved a record-setting goal of more than $1 million in 2009 and the Big “I” is working to build and strengthen relationships with legislators who have supported the independent agency system. But personal communication is just as important. The Big “I” Legislative Conference & Convention offers an opportunity for members to visit Capitol Hill and educate legislators on the issues important to the success of their businesses and their livelihoods.

Join the Big “I” March 3-5 in Washington,

D.C. for the annual pilgrimage. The event includes a legislative briefing to educate agents on the issues and talking points, as well as opportunities to hear from a variety of powerful speakers from Capitol Hill and within the industry.

Get more information on the event, see the full schedule or register online today by visiting the Events section of www.iiaba.net.

Young Agents Day on the Hill The 2010 Young Agents “Day on the Hill” is scheduled for Tuesday, March 23rd.

Get more information on this event on page 49 of this issue, or visit www.insurors.org.

The Insurors 117th Annual Convention Dates for the Insurors 117th Annual Convention have been set. The 2010 event will take place October 24th-26th in Nashville at the Hilton Downtown.

Preparations are underway now to ensure that this year’s convention continues to build on the success we have seen in recent years.

Look for more information coming soon on entertainment, exhibits, CE, golf, speakers, activities and more.

As always, updates will be available in the Insurors Bulletin, future issues of this magazine and on our website www. insurors.org. u

S E C U R I T Y

T

he National Security Group has always been committed to helping others feel secure in times of need, and we’ve been doing just that for over sixty years. Our relationship with our policyholders is only equaled by our relationship with our agents, providing them with a partnership profit sharing program and an awardwinning web site that enables 24/7 realtime policy info, fast online quotes, and endorsement and policy dec page printing to name a few. Talk with us today and discover why thousands of policyholders depend on us to insure their world. Call 1-800-239-2358 or visit us on the web at www.nationalsecuritygroup.com. ;n\cc`e^ =`i\ C`d`k\[ ?fd\fne\ij DfY`c\ ?fd\fne\ij MXZXek ;n\cc`e^ G\ijfeXc 8lkfdfY`c\ GXike\ij_`g GifÔ k J_Xi`e^

The Tennessee Insuror

NOW E! L AVAILAaBnt Vac g Dwellin

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Download the Insurors CE Calender to Outlook

by Daniel Smith, Director of Communications Did you know that you can download the entire 2010 Insurors Education calendar to your Microsoft Outlook? That’s right, this year’s entire CE schedule can be imported right into your home or work computer’s scheduling and e-mail program. Keep track of dates or set up reminders to attend or get yourself registered, all without having to make your own calender!

All you have to do is follow these steps to get it set up: 1.

Go online and visit www.insurors.org

2.

Click on the “Education” link in the menu on the left side of your screen

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Under “Education Schedule” find the link that says “Download the 2010 Education Calendar to Microsoft Outlook”

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Right click on the link and click “Save Link As”

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Open your Microsoft Office program

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Find the “Insurors_Education_Calendar” file that you saved

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It is that simple! If you have another calendar already set up, you can view the new calendar in a “side-by-side” mode, or right click on the calender and select “overlay” to view them together.

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Want to set up a reminder for a specific course? Find the course you want on the calendar, then double click on it to bring up the file. From the menu at the top, select “Reminder” and choose the amount of lead time you want to have.

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Directory of Advertisers Advertiser

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