Big I Washington Fall 2017 by PHCC-WI

FALL 2017

Big I Washington is a publication of the Independent Insurance Agents & Brokers of Washington

The BIGGEST MISTAKES Agents Make

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A CRC GROUP COMPANY CRC Group | CRC | CRC Swett | SCU | JH Blades | TAPCO | Programs ©2017 SCU is a division of and operates under the licenses of CRC Insurance Services, Inc., CRC of California Insurance Services, CA Lic No 0778135. No claim to any government works or material copyrighted by third parties. Nothing on this website constitutes an offer, inducement, or contract of insurance. Financial strength and size ratings can change and should be reevaluated before coverage is bound. This material is intended for licensed insurance agency use only. This is not intended for business owner or insured use. If you are not a licensed agent please disregard this communication.

Official publication of Independent Insurance Agents & Brokers of Washington 11911 NE 1st St., Suite B103, Bellevue, WA 98005 Ph. (425) 649-0102 Fax: (425) 649-8573 Web: www.wainsurance.org Officers of IIABW President: Lori Reed, Mitchell Reed & Schmitten Insurance, Inc., Wenatchee President-elect:Rob Tripple, Tripple Tripple & Tripple, Edmonds Secretary: Dave Merrill, Merrill & Merrill, Seattle Treasurer: Melissa Power, ACSR, CIC, Homestreet Insurance, Spokane IIABA Director: Sue Knobeloch, CIC, CPIW, Association of Risk Managers NW, Tacoma Executive VP: Daniel Holst, IIABW, Bellevue Board of Directors Rob Bush, (King), Valley Insurance, Kirkland Craig Field (Chelan/Douglas), Mitchell Reed & Schmitten Insurance, Inc., Wenatchee Matt Henderson (At Large) PayneWest, Richland Duane Henson, LUTCF (Skagit/Island), WAFD Insurance Group, Mt. Vernon Kim Krogh, ARM, (Past President) Hub International Northwest, Spokane Mary Lemon (Spokane), Hub International Northwest, Spokane Amberlyn McQuary Buratto, CIC (At Large), Stonebraker McQuary, Spokane Dave Merrill (At Large), Merrill & Merrill Insurance, Seattle Melissa Power, ACSR, CIC (At Large), Homestreet Insurance, Spokane Nick Stay (Pierce) American Underwriters Insurance, Tacoma Dave Street (Grant), Martin-Morris Agency, Wenatchee Rob Tripple (Snohomish), Tripple Tripple & Tripple, Edmonds Carissa Veltri (Benton-Franklin), Conover, Tri Cities Dan Wareham (At-Large), Blasingame Insurance, Spokane Staff Daniel Holst, Executive V.P. - dholst@wainsurance.org Suzanne Arnett, Sr. V.P. of Education - sarnett@wainsurance.org Kimberly Ostling, Director of Member Programs - kostling@wainsurance.org Kathy Gardner, Administrative Assistant - kgardner@wainsurance.org Bill Stauffacher, Stauffacher Communications, Contract Lobbyist - gocougs@billstauffacher.com Big I Washington is the official magazine of the Independent Insurance Agents & Brokers of Washington and is published quarterly. News items from IIABW members are requested. IIABW does not necessarily endorse any of the companies advertising in this publication or the views of its writers. IIABW reserves the right in its sole discretion to reject advertising that does not meet IIABW qualiﬁcations or which may detract from its business, professional or ethical standards.

FALL 2017

Advertiser Index 13

Anderson & Murison

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Burns & Wilcox

CRC Group

Grange Insurance Association

Griffin Underwriting Services

Imperial PFS

ISU Agency Network

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Preferred Property/JGS

Advertising For more information on advertising, contact Eric Johnson Blue Water Publishers, LLC phone: 414.708.2059 • fax: 414.354.5317 eric@bluewaterpublishers.com

The publisher cannot assume responsibility for claims made by advertisers, content provided by the editor, or for the opinions expressed by contributing authors.

Western National Insurance

Table of Contents 6 A Message from Lori Reed, IIABW President

16 Risky Business: Insuring the Marijuana Industry

8 Washington State Insurance Commissioner Mike Kreidler

18 How to Avoid E&O Claims from New Products

11 No Tax Increase for Agents

20 Webinar Series

12 The Biggest Mistakes Agents Make

22 E&O Coverage That’s Right for Your Business

14 Young Agents Conference

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IIABW President

Lori Reed

t has been my honor to serve as your association’s president this past year. It meant so much to me to continue my family’s tradition of leadership within this fine association. I have met and worked with so many wonderful people over this past year. It has truly been one of the highlights of my insurance career.

for lower taxes and reasonable regulations. We have a team of lobbyists in Washington, D.C., advocating on behalf of agents on NFIP, health insurance, crop insurance, etc. • Brand ourselves. Agents do a wonderful job establishing agency brand identity in their communities through community service and quality customer service. The Big I has established a national brand, Trusted Choice, to compliment your brand (like Intel Inside in a computer) and to help you compete with the billions of dollars each year your competition spends in advertising. All members get a free listing on www.trustedchoice.com, which is driving thousands of referrals to Washington members each year. • Protect ourselves. For over 30 years we have offered members a competitive E&O program through multiple markets. This fall, Swiss Re, our flagship product, will be significantly reducing its rates so we encourage you to reach out to us. Kimberly Ostling, daughter-in-law of long time E&O administrator Bev Ostling, would love to help find the right coverage for your agency.

As I look back at my year as president, I wanted to share how we have progressed in our priority to provide value to our members. Membership is the lifeblood of the association. We are all independent agents so we rely on ourselves and our teams to build successful companies. Yet, in this rapidly changing world there are many resources that we need to be successful. Over 100 years ago agents formed the Big I to do things that agents couldn’t do as efficiently by themselves. There is no question that there are economies of scale and benefits of large numbers. As a group, we can better: • Advocate for ourselves. Yes, we could all spend 3-5 months in Olympia each year reading through thousands of bills to determine how they impact our businesses and customers. Instead, you hire us to lobby 6

• Grow ourselves. IIABW continues to work with the industry and community colleges on developing new producers and service staff. We are working on a new apprentice program to make it easier for agencies to find and train new employees. Thank you for giving me the opportunity to serve as your president this past year. Your association is in great hands with the leadership of Rob Tripple, President; Dave Merrill, President Elect; Melissa Power, Secretary; and Amberlyn McQuary Buratto, Treasurer. Lori Reed IIABW President Mitchell Reed & Schmitten Wenatchee

WASHINGTON STATE INSURANCE COMMISSIONER

Mike Kreidler

WORK FOCUSES ON STABILITY FOR WASHINGTON’S INDIVIDUAL HEALTH INSURANCE MARKET

his has been a tumultuous year for health insurance markets across the country and Washington state has certainly not been immune. Whether the Affordable Care Act would remain the law of the land was not an easy bet to make even just a month ago. As our state’s insurance regulator, my top priority has been to keep our insurers informed of the changing landscape and to do what I can to keep our individual health insurance market stable in a time of great uncertainty. Many of the challenges we face today are not new – whether it’s a narrowing of provider networks or fewer insurance choices in the rural parts of our state. These trends were in place well before the Affordable Care Act. However, today there are other external factors that are making insurers very nervous. Will President Trump decide to pay the cost-sharing reduction subsides that many low-income working families depend on? Insurers are on the hook to fund these subsidies regardless of whether or not they’re reimbursed by the federal government. Will the Trump administration enforce the individual mandate? If not, what incentive is there for the younger and healthier among us to get covered? Having a wide range of risk participating helps keep insurance costs down for everyone.

Also, open enrollment is just around the corner and it’s still unclear whether the federal government will even maintain an advertising budget, let alone make an effort to reach out to consumers. August and September are critical months for our health insurance markets as the reviews of the insurers’ plans and rates will wrap up. Fortunately, some key players in Congress have initiated a bipartisan effort to find ways to stabilize and strengthen the individual health insurance market. Senators Patty Murray and Lamar Alexander (R-Tenn.) will hold a series of bipartisan public hearings September 5 before the Health, Education, Labor and Pensions Committee. The committee asked me to attend to share Washington state’s experience and the work we’ve already undertaken. Much of our work predates this summer, but it became critical this June. That’s when the insurers filed their proposed plans and rates for 2018 and we discovered two counties – Klickitat and Grays Harbor – would have no health insurer. It was a tense couple of weeks. We acted quickly to find coverage for these areas. I personally reached out to our insurers to see if they would reconsider. I’m thankful we now have coverage statewide, but we need to know what steps we can take to prevent this potential crisis from occurring again. Continued on page 10 >>

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<< Continued from page 8

That’s why we’ve launched a market stabilization project, in conjunction with our Exchange, Washington Healthplanfinder. Over the next couple of months, we’ll conduct detailed economic and actuarial analysis of a number of market options to see which, if any, could improve the stability of our individual health insurance market. The focus will be on improving affordability and increasing access in the rural areas of our state. The options we’re considering include: • Creating a reinsurance program based on either claims or conditions • Establishing a high-risk pool • Creating a state-offered or public option • Re-addressing the current geographical rating areas In addition, we’re also considering applying for a waiver from the federal government that would allow us to reallocate current federal money to improve the stability of this market. If we decide this is the right path, we’ll need approval from the legislature in 2018. I’d urge you to follow our progress and stay engaged. If you have feedback, I’d love to hear from you. Sign up to get updates on our market stabilization project at https://www.insurance.wa.gov.

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NO TAX Increase for Agents By Bill Stauffacher

his summer, the Washington State Legislature passed and Governor Inslee signed into law a two-year 20172019 operating budget, which avoided a government shutdown.

Issues of note for IIABW: • NO NEW CAPITAL GAINS TAX: The state did not adopt a capital gains tax. This proposal would have had a dramatic impact on book of business sales. • NO TAX HIKE ON PRODUCER COMMISSIONS: Proposals to increase the B&O tax rates on insurance producers’ revenue were defeated. IIABW has once again been successful in keeping in place the current B&O tax rate of 0.484 percent. • NEW PAID FAMILY AND MEDICAL LEAVE LAW: Passage of the paid family leave law will impact members’ businesses and 3285customers Big I Washington by allowing eligible workers 12 weeks of either paid 7.675X4.9 or family leave beginning in 2020, or 16 weeks for a combination both. An additional two weeks may be used if there is a serious GenofUmbrella health condition with a pregnancy. Premiums for the newly crafted family and medical leave state fund are shared between

employers (paying 37 percent) and employees, and employers with 50 or fewer employees are exempt from paying the employer share of the premiums. • SCHOOL HEALTH INSURANCE SALES AT RISK: Legislation to bring comprehensive reform to K-12 schools includes a provision which would end commercial market sales of health insurance to school districts by 2020. School district employees’ health benefits would be funded and managed by the state. IIABW has been lobbying against this provision and now has been actively working with the governor’s office to seek its veto. This proposal was included in the legislation that was negotiated in private during the final hours of budget-related discussions. • PROPERTY TAX INCREASES: The legislature reformed state and local school district property taxes as a result of the McCleary K-12 education lawsuit. The state will now take on a much larger portion of K-12 funding. There will be a property tax increase of 81 cents per $1,000 assessed property value on average.

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The BIGGEST MISTAKES Agents Make By John Chapin

MISTAKE #1: Thinking that servicing accounts is more important than selling new ones I once had a coaching client show me a stack of folders and say, “This is why I can’t be out calling on new clients.” When I asked what had to be done, she picked up the first folder and said, “I’m waiting for a number from the State of Rhode Island on this one.” To which I responded, “Really? A producer is sitting in the office waiting for a number from the state of Rhode Island? No one else can handle that?” That is akin to a pilot saying they don’t have time to fly the plane because they are back serving customers drinks. I’ve heard every excuse for servicing accounts from “they’ll only deal with me,” to “I want to make sure it’s done right.” These are simply excuses to avoid the hard work of going out and making calls. Producers are hunters, service people are gathers. Outside of renewals, scheduled service calls, and emergencies, clients should be dealing with CSRs and other support people. Not only are the support people more readily available than the agent, who should be out chasing new business, they also handle the day-today service items more efficiently and effectively than an agent. As an agent your job is to sell, not service. If you are hiding behind the excuse that your clients will only deal with you, that’s because you’ve trained them to do that. Time for retraining. If you think you are the only one who can do it, you’re wrong, get over yourself. Any time you are servicing, outside of renewals, scheduled calls, and major issues, you are doing yourself, your agency, your client, and your future clients a disservice. It’s what we call lose/lose/lose/lose. Go sell and stop hiding behind service. MISTAKE #2: Majoring in minor things and finding other time wasters I once had a sales manager remark to me, “During the major snow storm last week, when people were confined to their 12

houses, my top agent was calling people at home because he had a captive audience. My other agents were baking cookies and posting pictures on Facebook.” This along with chatting with friends and colleagues, checking email more than four times a day, taking ten coffee breaks, and, in general, finding things to do other than calling on prospects and customers, are examples of time wasters. Spending two hours looking up prospect information before you call, servicing clients on routine items as in Mistake #1, and spending time practicing your call 400 times before the call, are all examples of majoring in minor things. Your highest priority is to spend time with prospects and “sometimes” your top 20 percent of customers (again, renewals, scheduled calls, and emergencies). You should be talking to, or on your way to talk to, prospects and customers 80 percent of the time during prime calling hours.

YOU HAVE TO BE PREPARED FOR EVERY SALES SITUATION YOU’RE GOING TO ENCOUNTER AND YOU HAVE TO PRACTICE AHEAD OF TIME. MISTAKE #3: Focusing on reactive versus proactive marketing The fastest and best way to build business is by making phone calls and knocking on doors. It is the most effective and only one in which you have almost complete control over. Going to a Chamber of Commerce event, BNI, or some similar networking event, hoping to get a lead is reactive. In those situations you are relying on others, whose first priority is to get business for themselves, to give you business. Worse yet, hanging out on social media or sending blind, unsolicited emails in hopes of getting business.

MISTAKE #4: Not being prepared for and not practicing sales situations If you are in leadership, I dare you to walk up to one of your agents who has been with you a while and ask, “What do you say when someone says…” and then give them a common, everyday objection they get like, “they’re not interested?” I promise you that 9 times out of 10 the first verbal sound out of their mouth will be “Ahhhh.” It happens to me all the time. Just last week at a sales meeting at an insurance agency, I turned to an agent who’s been there 17 years and asked, “Joe (name changed to protect the guilty), what do you say when someone says I can get my insurance cheaper down the street?” The response? You guessed it, “Ahhhh.” Game over. You have to be prepared for every sales situation you’re going to encounter and you have to practice ahead of time. Ideally with another human, but if not, with yourself. Each and every answer has to be scripted and committed to memory so that you know it verbatim and can respond immediately in a real-life sales situation. Mistake #5: No goals, no plan, and no clue how much activity has been done, or needs to be done, in order to be successful Whenever I begin working with someone one of the first questions ask them “How many calls did you make A&M IAssoc Ad WA is, PRINT.pdf 1 10/20/15 12:36 PM last

week on brand-new prospects?” As with the objection above, I am usually met with “Ahhhh.” Usually followed by a guess, like, “Um, I think about four.” “You think four? Is that number too big to count?” The truth is: they didn’t keep track and it wasn’t four. It may have been two, or even zero. In order to be successful, you have to have annual, monthly, and weekly goals, along with knowing the daily activity necessary to make those goals a reality. Then you have to make the calls. MISTAKE #6: Giving up too soon 81 percent of sales are made after the fourth contact. Roughly 20 percent of agents make it past the fourth contact. Enough said. MISTAKE #7: Not doing the work necessary 99 percent of the time an agent fails it’s due to a lack of activity. Not making enough calls to talk to enough people in order to make enough sales. The other 1 percent of the time, the agent got hit by a bus. Since activity is the primary reason for success or failure, I could have led off with it, but it’s so obvious you probably would have stopped reading. John Chapin is a motivational sales speaker and trainer. For his free newsletter, or to have him speak at your next event, go to: www.completeselling.com John has over 29 years of sales experience as a number one sales rep and is the author of the 2010 sales book of the year: Sales Encyclopedia. You can reprint provided you keep contact information in place. Email: johnchapin@completeselling.com.

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Young Agents Conference

IABW’s Young Agents had another very successful conference in Leavenworth in June. Almost 100 people attended this two-day conference packed with networking, education and fun. The conference began with a golf tournament followed by an afternoon of CE sessions and an outdoor BBQ. The next day was filled with seven hours of CE and social functions. Mark your calendar for next year’s Young Agent’s Conference, which will be held at Campbell’s Resort on Lake Chelan June 14-15. The Young Agents Holiday Party will be held on November 16 in Kirkland.

RISKY BUSINESS:

By Julie Carter

he number of states legalizing the growth, distribution and possession of marijuana, in one form or another, continues to increase. As of this writing, 28 states and the District of Columbia have legalized the use of medical marijuana; eight states and the District of Columbia have legalized the use of recreational marijuana. The cannabis market is a multi-billion dollar industry, with revenue expected to reach $20 billion by 2021. It is important to remember, the fact is that the growth, distribution or possession of marijuana is a crime under federal law.

As with any other business, those involved in the industry are seeking insurance coverage for their assets and potential liabilities, and the opportunities for carriers, brokers and agents may seem endless. However, although laws regulating the marijuana industry (as well as the insurance industry) are controlled by individual states, the use, sale or cultivation of marijuana is a still a crime under federal law, as is the aiding and abetting of these acts. While the Obama administration made it clear it did not intend to seek prosecution of marijuanarelated activities in states where it has been legalized, Attorney General Jeff Sessions recently stated the current administration intended to â&#x20AC;&#x153;crack downâ&#x20AC;? on such activities. Therefore, any procurement of insurance for cannabis enterprises is extremely risky â&#x20AC;&#x201C; both in the procurement itself and in the coverage minefields that may result in E&O claims against an agent or broker. There are a few insurance carriers providing coverage to cannabis businesses. These businesses run the gamut from one-man operations to large companies with sophisticated technology and several employees. These insureds are seeking the same types of coverages as many other retail and/or crop enterprises: Commercial General

Liability, Business Property, Cyber Liability, Workers’ Compensation, Directors & Officers Liability, Commercial Auto, Products Liability, Pollution, Crop, Employment Practices Liability, etc. Also, most of these businesses have a steady influx of cash on the premises, given the fact that U.S. banks are not allowed to deal with the cannabis industry because of the federal law criminalizing such activity. However, given there is not much guidance or precedence to clarify the validity of such insurance contracts and the enforceability of insurance contracts provided to marijuana businesses, many carriers are refusing to write policies for these potential clients. For example, one major worldwide carrier is not renewing policies with this type of coverage until marijuana use is declared legal under federal law. Much of the concern centers around two issues: 1) is the insuring of an illegal activity under federal law a criminal activity in and of itself, causing the insurance contract to be unenforceable; and, 2) exclusions in many standard-form policies may provide illusory coverage for an insured. Regarding the first issue, whether or not a court of law could determine that an insurance contract was void as the result of insuring an illegal activity is definitely a risk for a business and therefore, the insurance agent that procured the policy. In addition, a carrier could potentially deny coverage for certain acts because of the federal law issue, leading to a “failure to procure” E&O claim against an agency. Regarding this issue of “exclusions,” many traditional insurance policies, exclude coverage for “illegal activities,” “criminal acts” and “intentional behavior.” Exposures such as civil RICO claims, money laundering and reputational risk are valid concerns for those involved in the cannabis industry. Whether or not such exposures can, or should, be covered

by an insurance policy is a matter of great debate within the insurance community. Given the dichotomy between state and federal laws on the legalization issue, and conflicting court rulings regarding insurers obligations to provide coverage, there is great risk to an agent in procuring this coverage. Policies would likely not be standard ISO forms given the unique risks to these insureds and the numerous regulations the states place upon such operations. Marijuana growers and distributors are required to be licensed. The particular licenses and permits that are required depend on where the businesses are located. For example, in California, 20 types of licenses are required, including permits for farmers, delivery services, testing labs, distributors, dispensary operators, etc. An in-depth knowledge of all applicable licensing issues would be required by any insurance provider. It is important to remember the fact is that the growth, distribution or possession of marijuana is a crime under federal law. This issue alone should weigh heavily into all other considerations for an agency tempted to enter this area of the insurance arena. The law and the insurance industry will continue to evolve. However, for the prudent insurance agent, it is likely best to wait until the smoke clears before considering procuring insurance for a client in this field in order to avoid a potentially problematic E&O claim. Julie Carter is an assistant vice president, claims specialist with Swiss Re Corporate Solutions and works out of the office in Overland Park, Kansas. Insurance products underwritten by Westport Insurance Corporation, Overland Park, Kansas, a member of Swiss Re Corporate Solutions.

How to Avoid E&O Claims from New Products

n ancient proverb would have us believe that, “There’s nothing new under the sun.” That may have been true once upon a time, but beyond question, the speaker was not referring to modern insurance markets. As new risks emerge at a dizzying pace, new insurance products are being developed to respond and protect insureds from these new – and some old – exposures. It goes without saying that even a good insurance agent can get into trouble placing these new coverages, which begs the question: how can an insurance agent dealing with these new products protect themselves from an unwanted E&O claim?

1. Understand the changing needs of your client This means asking the right questions, listening to the answers and following up appropriately. For example, an association filed a construction defect lawsuit against a client roofing company. The lawsuit alleged that the client was hired to provide roof and structural engineering consulting, assist in preparing bid documents, selecting contractors, selecting types of products and selecting the installation process for the new roof. A few years after the work was completed, numerous defects appeared in the work and materials used. A claim was submitted to the client’s general liability carrier, which denied the claim on the basis that there was no coverage for breach of contract, breach of express warranty, and professional malpractice, as they were not caused by an “occurrence” as defined by the general liability policy. The client proceeded to bring a claim against the agent for failure to recommend and procure a professional liability policy. The client’s claim was defeated by evidence from the agent’s files, which reflected that on numerous 18

occasions the agent, aware that its client had begun doing consulting work, offered professional liability coverage to the client – which was rejected every time. To stop an E&O claim from developing, an agent should be sure to document each time a new insurance coverage/ limit is recommended to a client along with the client’s response. Follow up appropriately. Questions left hanging are often used to hang E&O claims on agents. 2. Understand how the insured’s business is impacted by the policy’s terms and conditions In jurisdictions and situations where a duty to advise exists, the agentinsured relationship cannot operate in a vacuum. There has to be two-way communication.

claims made and reported professional liability policy. The agent and architect agreed to move the coverage to a new carrier, for which the client completed a new application. The architect failed to disclose, however, that a potential ‘negligent design’ claim by the truck terminal’s owner was in the wind. The new carrier bound and issued a claims made and reported professional liability policy. A few months later the owner made a demand on the architect, who at that time reported a claim to his new professional liability carrier. The new carrier promptly denied coverage for the claim on the basis of prior knowledge. The architect knew about the possibility of a claim by the truck terminal owner prior to the new carrier’s policy inception, and therefore, the claim was denied.

For example, an insured’s client – an architect – designed a truck terminal for its owner. During the construction of the project the owner alleged the architect’s design contained mistakes that resulted in construction delays and additional costs for its customer.

The architect then brought an E&O claim against the agent for negligent procurement and breach of contract claiming that the agent failed to provide him with matching and continuous coverage, and further failed to advise him that the new policy did not contain first dollar defense.

After some time had passed, the architect came into his agent’s office to procure a

Context is key here. Is this a new business or a going concern? A new

policy or a replacement? If the latter, thought should be given to how the new policy will address old business. In order to avoid an E&O claim the agent should review the differences in coverage between the expiring and new policies looking for gaps and changes, then communicate and document that these differences were discussed with, and selected by, the client. With respect to claims made and reported professional liability policies, in particular, it is imperative that an agent encourage clients to list all incidents on its application. That way, if an incident needs to be reported to an expiring carrier, as discussed above, such notice is timely provided. Additionally, in order to keep the lines of communication open with clients, the agent should be responsive and helpful to all client inquiries. 3. Report claims to all carriers What if you and your client only have a â&#x20AC;&#x2DC;meeting of the mindsâ&#x20AC;&#x2122; concerning a new risk after a loss already has occurred? All is not lost. Existing coverages and policy forms can be slow to adapt to new exposures. Consequently, even after a loss has occurred it can be hard to determine which will cover it and which will not. The smart agent does not try to answer those questions, rather they simply direct the insured to submit the claim to every carrier that might provide coverage.

The bid was accepted and the facility built. After completion, the property owner alleged significant movement and deformation of certain tunnels. The owner alleging construction and design defects filed a lawsuit. The agency had procured Commercial General Liability (CGL) and professional liability policies for this new client. Although well versed with general liability policies, the agency had just begun to procure professional liability policies. When the claim was first reported to the agency, their natural inclination was to report the claim to the CGL carrier. The CGL carrier provided coverage under a reservation of rights and filed a separate lawsuit against the client to determine coverage. A few months later, the agency reported the claim to the professional liability carrier who declined coverage as the claim was not reported within the effective dates of the policy period or within 60 days of the expiration of the policy. Ultimately, the coverage lawsuit was decided in favor of the CGL carrier and the client was left without coverage. The client then filed a lawsuit against the agency

alleging a failure to report the claim to the professional liability carrier when they were first notified. Always remember that it is the carrierâ&#x20AC;&#x2122;s duty to determine the availability of coverage for their policyholder. If the professional liability carrier had been put on notice of the lawsuit when the agency was first notified, the client would have had coverage for the claim and litigation against the agency would have been avoided. Professional liability insurance policies have many similarities, but do evolve over time as new products enter the market. Take time to learn the needs of your clients and educate yourself about the policies in the marketplace and their impact on your clients and you. Barbara Rocco and Kristina Miller are Assistant Vice Presidents and Claims Specialists with Swiss Re Corporate Solutions and work out of the Chicago office. Insurance products underwritten by Westport Insurance Corporation, Overland Park, Kansas, a member of Swiss Re Corporate Solutions.

A company that designs and builds industrial production facilities submitted a bid for a redesign of a cement facility. 19

IIABW WEBINAR SERIES IIABW has been receiving rave reviews from our members about our new webinar series. Members have the choice of a dozen three-CE seminars each month on timely topics taught by some of the industry’s premier instructors. All webinars are live and not prerecorded so you can ask questions; no exam is required. Go to our website (www.wainsurance.org) and click on the Education/Webinars tab. We are offering our new seminar, “E&O: Roadmap to Policy Analysis,” which is offered every month. It is broken down into two, three-hour seminars and when both are taken they can be eligible for the 10 percent Swiss Re Loss Control Credit. SEPTEMBER 9/7 - Condominiums 9/8 - Business Auto Coverages 9/11 - Insuring Trusts - Protecting Your Client’s Wishes 9/19 - Farm Liability Coverages 9/20 - E&O: Roadmap to Policy Analysis - Part 1 9/20 - E&O: Roadmap to Policy Analysis - Part 2 9/21 - Protecting Your Most Valuable Asset 9/21 - The Dirty Dozen 9/25 - Personal Auto Policy 9/26 - Unlocking the Secrets of D&O Insurance 9/27 - Ethics and Agent Liability 9/28 - Dispelling the Myths of Workers’ Compensation OCTOBER 10/12 - 10 Things Every Commercial Lines Agent Ought to Know 10/13 - Additional Insureds and Certificates of Insurance 10/17 - E&O Risk Management: Meeting the Challenge of Change - 1 10/17 - E&O Risk Management: Meeting the Challenge of Change - 2 10/17 - E&O Risk Management: Meeting the Challenge of Change - 1 10/19 - Top 10 Countdown of Personal Lines Coverages & Current Issues 10/19 - Fiduciary Liability, ERISA Bonding, and Employee Benefits Liability 10/23 - Ethics and the Law

10/24 - Insuring Toys and Collectibles 10/24 - Commercial General Liability Coverages 10/25 - Farm Property Coverages 10/26 - Contractors Property Exposures 10/26 - Life and Health Solutions for Business Challenges NOVEMBER 11/6 - Cyber Liability 11/7 - Personal Auto Hot Topics ... What You Need to Know 11/8 - When the Child Becomes the Parent - Aging Parents and Insurance Decisions 11/9 - Who Is An Insured 11/13 - Ethical Dilemmas ... Making the Right Choices 11/14 - E&O: Roadmap to Policy Analysis - Part 1 11/14 - E&O: Roadmap to Policy Analysis - Part 2 11/15 - Business Auto Coverages 11/16 - It’s Not My Fault, or Is It? - Liability Issues in Personal Lines Policies 11/17 - Commercial Property Coverages 11/20 - The Dirty Dozen 11/28 - Contractors Liability Exposures ... Risk Analysis to Coverage Solutions

DECEMBER 4 - Workers’ Compensation 5 - Farm Liability Coverages 6 - Business Income - Coverage Analysis through Claims 7 - Personal Auto Policy 7 - An Agent’s Guide to Insuring Nonprofits 11 - Ethics - Walking a Straight Line 12 - E&O: Roadmap to Policy Analysis - Part 1 12 - E&O: Roadmap to Policy Analysis - Part 2 13 - Insuring Trusts - Protecting Your Client’s Wishes 13 - Homeowners Hot Topics ... What You Need to Know 14 - Additional Insureds and Certificates of Insurance

The ISU Unique Competitive Advantage™ Awarded only to qualified, well established and highly successful Independent Agencies with at least $1,000,000 of revenue.

The ISU Insurance Agency Network is a nationwide community of fiercely independent Agents committed to one another’s mutual success and united by strong fellowship, common attitudes, interests and goals.

For a no obligation exploratory discussion, contact: Steve Pearson President (415) 623-5147 • spearson@joinISU.com www.joinisu.com

Insurance Agents Errors and Omissions Coverage That’s Right for Your Business

Why Big “I” Professional Liability and Swiss Re Corporate SoluƟons?

Swiss Re Corporate SoluƟons Policy Form Highlights

Prompt, Local Service – Superior customer service and exper�se by your Big “I” state associa�on, who serves as your agent with underwri�ng authority oﬀering prompt turn-around of quotes and policy delivery.

Big “I” Professional Liability program and Swiss Re Corporate Solu�ons pride ourselves on oﬀering the strongest coverage form in the marketplace that con�nues to evolve to meet the changing needs of agents. Review the preferred policy form and you will nd that these are just a few of the coverage benets:

More premium discounts – Qualifying agents can save over 50% in premium discounts including the loss control, claims free, agency opera�ons improvement review, efficiency, and carrier concentra�on credits. Deduc�ble Savings – Loss only deduc�ble available along with deduc�ble reduc�on feature offering up to 100% savings of deduc�ble per claim. Ease of Business – Our qualifying policyholders enjoy the benet of automa�c renewal available with no applica�ons along with online applica�ons when required. Claims Handling – Prompt and thorough claims handling by an experienced staff made up primarily of licensed a�orneys that stand ready to support policyholders with any poten�al incident or claim. Flexible Underwri�ng – Targe�ng agencies of all sizes and unique opera�ons including both P&C and L&H-only agencies. Capacity – Limits up to $25M with op�onal umbrella and excess quotes available over approved carriers. Risk Management Tools – Policyholders have FREE access to the exclusive website E&O Happens (www.iiaba.net/eohappens) and the E&O Claims Advisor Newsle�er.

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Stability - Na�onally endorsed program with over 25 years experience and the largest and most stable independent insurance agency E&O program in the country, rated “A+” (Excellent) by A.M. Best.

▪ ▪ ▪ ▪

Exclusive - A Big “I” member exclusive policy form and premium credits led on a Risk Purchasing Group basis give Big “I” members tailored coverage.

▪

Member Oversight - A Professional Liability Commi�ee, comprised of IIABA members, oversees and directly inuences the program. Our program was designed by agents for agents.

Rated A+ by A.M. Best State of the art coverage form exclusive to Big "I" Members Claims-made coverage with full prior acts Coverage for the sale of both Property/Casualty and Life/Health insurance products Limits of liability up to $25 million Broad deni�on of covered professional services and ac�vi�es Comprehensive deni�on of insured Aggregate deduc�bles Defense cost outside the limit $25,000 1st Party Personal Data Breach $1,000,000 3rd Party Personal Data Breach sublimit 60/40 consent to se�le clause Crisis Management coverage; up to $20,000 per policy period for fees, costs, and expenses incurred within 6 months of a crisis event Deduc�ble reduc�on up to $25,000 per claim with proper documenta�on, no limita�on on the number of claims Catastrophe Expense $25,000 per incident, $50,000 per policy period Regulatory defense $60,000 per policy period True worldwide protec�on 10% premium credit 3 years for a�ending an approved loss control program 10% premium Credit for 5 years for having an approved in-house E&O audit

If you have any ques�ons please contact your state administrator.

Agent Advocacy - Supports lobbying eﬀorts protec�ng your industry by contribu�ng a percentage of every premium dollar to the funding of important advocacy eﬀorts of the IIABA.

The informaƟon provided is for general informaƟonal purposes only and you should review the policy form and any applicable endorsements for complete policy language. Please note that all applicaƟons are subject to review, underwriƟng and approval by Westport Insurance CorporaƟon, a member of Swiss Re Corporate SoluƟons.

Thoughtful is giving our agents tools to succeed. Thoughtful is giving agents tools to succeed.

Weâ&#x20AC;&#x2122;re proud to announce the Marketing Playbook. Our latest innovation to help agents strengthen relationships with clients and prospects.

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Weâ&#x20AC;&#x2122;re proud to announce the Marketing Playbook, our latest innovation to help agents strengthen relationships with clients and prospects. An interactive hub, the Marketing Playbook contains our entire library of brochures, infographics, videos and more, in one organized, easy-to-use place. Giving agents what they need to be successful at helping others is how thoughtful insurance is done. Visit playbook.mutualofenumclaw.com to learn more.

Your clients are unique. Their coverage should be, too. At Liberty Mutual Insurance, we know that your clients have specific needs. As the

#1 preferred business Insurer,* we take the time to work with you to understand them better — then build tailored coverage that’s as unique as they are. For more information, contact your territory manager or visit LibertyMutualGroup.com/Business. We are proud to support the Independent Insurance Agents & Brokers of Washington.

*Based on 2016 survey of business insurance buyers on preference of national carriers sold via independent agents. © 2017 Liberty Mutual Insurance. Insurance underwritten by Liberty Mutual Insurance Co., Boston, MA, or its affiliates or subsidiaries.