2021 October PIA Connecticut by PIA Northeast

October 2021• Connecticut

PAGE 18

What’s your WHY? Get through the uncertainty and confusion

IN THIS ISSUE 9

Branding across generations

Handling key umbrella issues

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DEPARTMENTS 4 October 2021 • Connecticut

In brief

9 Legal 15 Sales 31 E&O 35

Ask PIA

Readers’ service and advertising index

39 Officers and directors directory

COVER STORY 18 What’s your why? Get through the uncertainty and confusion

FEATURE 25 Respect your brand across the generations The delicate art of modernizing your agency

Statements of fact and opinion in PIA Magazine are the responsibility of the authors alone and do not imply an opinion on the part of the officers or the members of the Professional Insurance Agents. Participation in PIA events, activities, and/or publications is available on a nondiscriminatory basis and does not reflect PIA endorsement of the products and/or services. President and CEO Jeff Parmenter, CPCU, ARM; Executive Director Kelly K. Norris, CAE; Communications Director Katherine Morra; Senior Magazine Designer Sue Jacobsen; Editor-In-Chief Jaye Czupryna; Advertising Sales Executive Susan Heath; Communications Department contributors: Athena Cancio, David Cayole, Alexandra Chouinard, Patricia Corlett, Darel Cramer, Roberta Lawrence, Crystal Ringler and Calley Rupp. Postmaster: Send address changes to: Professional Insurance Agents Magazine, 25 Chamberlain St., Glenmont, NY 12077-0997. “Professional Insurance Agents” (USPS 913-400) is published monthly by PIA Management Services Inc., except for a combined July/August issue. Subscription rate for members is $13 per year, which is included in the dues; subscription rate for nonmembers is $25 per year. Professional Insurance Agents, 25 Chamberlain St., P.O. Box 997, Glenmont, NY 12077-0997; (518) 434-3111 or toll-free (800) 424-4244; email pia@pia.org; World Wide Web address: pia.org. Periodical postage paid at Glenmont, N.Y., and additional mailing offices. ©2021 Professional Insurance Agents. All rights reserved. No material within this publication may be reproduced—in whole or in part—without the express written consent of the publisher.

COVER DESIGN Roberta Lawrence Vol. 65, No. 9 October 2021

IN BRIEF

FIVE MINUTES WITH …

PIACT’s President Shannon Rabbett, CIC Tell us a little about yourself. I am a second-generation agency owner. My father started the business about 35 years ago. I joined it—and the industry— in 2005. Prior to joining the family business, I was a biotechnology recruiter. What are your goals for PIACT? My priorities for PIACT are to embrace transparency by demonstrating the association’s value, and to start a diversity initiative. Networking is the cornerstone of industry associations. Through events, members can learn from other members how they utilize the tools PIACT has to offer, or how they handle certain situations at their agencies, which are common to us all.

insureds, we can build upon that trust, and create loyalty so that we can not only protect our clients from any future crises, but help to prepare them as well.

Shannon Rabbett, CIC Principal Rabbett Insurance Agency Windsor, Conn.

While the pandemic has affected our ability to hold in-person events, we must prove to our members, and potential members, that we remain an excellent source of industry information and tools; just not in-person. PIA staff listens to members’ comments and concerns; connects agency principals together who share common objectives or pains; disseminates information and trends to agents; and develops content for classes, and marketing materials based on our needs. The expertise PIA staff provides—professional development, regulatory guidance, and education—has been valuable during the pandemic. I’d also like to broaden our membership pipeline to become a more diverse and inclusive organization. Industry perpetuation is suffering because of our aging workforce and lack of diversity. We need to reach current agents and young professionals entering the workforce. What do you see as the next step in the independent agent’s evolution? We need to focus on utilizing and leveraging technology, with an emphasis on workflow and best practices, so we can provide sales and service to a wide-ranging clientele. How has COVID-19 affected the industry? While agents have done their best throughout this pandemic to inform and educate clients on coverage limitations, no client wants to hear that there’s no coverage. Agents need to build/rebuild trust with their clients. Local, independent agents have been known as connectors for small businesses. By facilitating relationships with our 4

How does your agency’s brand help differentiate you? Our No. 1 asset is flexibility. We are willing to communicate with our insureds in whatever fashion they are comfortable (text, email, phone or a video conference). We do this by maximizing our existing technology. We have procedures and processes to streamline our production and services, but as a small agency, we make changes to them on the fly when they become outdated.

In a world in which agency consolidation is a daily occurrence—agencies are becoming larger and the choice for the consumer shrinks—there still is a need for small agencies with flexibility. Millennials are the largest group of consumers, and their buying habits have been analyzed for years. They want to start their insurance shopping process online, but they see the value in working with an experienced, local, and trustworthy insurance agent, who can educate them on the products they are buying. Has PIA membership benefited your agency? When I first joined the industry, PIA was my go-to for everything insurance-industry related, and it still is. I have benefited from PIACT’s professional development offerings, and the access to expertise and advice through the Ask PIA database and QuickSource library. I also have benefited on both a professional, and personal level, through the relationships I have formed with PIA staff and members. It is a huge benefit to enjoy the company of your fellow members! I have made life-long colleagues and friends during the last 16 years, and I look forward to making many more through the association in the future. What do you like to do in your spare time? In the warm months, you can find me outside working on gardening projects, and in the cold months, I work inside on crafting projects. Currently, I’m working on a mosaic carpet made from river rocks and reupholstering an old couch with moss. Soon it will be back to corks, buttons and glass bottle art.

PROFESSIONAL INSURANCE AGENTS MAGAZINE

BY THE NUMBERS

Social-media branding do’s & don’ts Social media is an imperative tool to manage your agency’s brand identity and In 2020 awareness. Not using social media to show off your agency would be a missed opportunity. But, there are myriad do’s and don’ts of agency social-media 3.96 BILLION management. The tips below will help you get—and stay—on the right track: people used social media worldwide.

DO:

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Set goals and strive to stand out Give your brand

A PERSONALITY. DON’T BE AFRAID TO BE FUNNY! Make sure it’s consistent with your brand.

Stay consistent

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Get political Use every platform out there Who are your customers?

WHAT SOCIAL MEDIA DO THEY USE? These are just a few tips to help you manage your brand on social media. For news and more tips, follow PIA Northeast on Facebook, LinkedIn &Twitter: www.facebook.com/PIANortheast; www.linkedin.com/company/pianortheast; twitter.com/PIA_Northeast. PIA.ORG

Offensive content will

DAMAGE YOUR BRAND REPUTATION. 5

FYI

Your agency needs a little push Chris Paradiso, president, Paradiso Financial & Insurance Services

From business concerns to personal matters, nearly everything can be managed through your smartphone or one of its apps. That said, it would be easy to get caught up in the daily buzz and forget that our phones exist. However, they remind us that they require our attention by using push notifications. These are notices that appear on your smartphone’s screen—even if your phone’s display is off and the device is stashed away in your pocket or purse. Often these notifications are accompanied by a quick ringtone or a small buzz. They get your attention. Whether it’s for a missed call, an incoming text message or a Facebook update, push notifications get you to look at your device, even when you hadn’t planned to do so. Push power What does this power mean for insurance professionals? They have the power to get in touch with all their customers who have smartphones simultaneously. You probably know that an independent agency mobile app provides tools to drive when-and-where-they-want service to your customers. More than that, mobile apps can send their app-enabled customers push notifications, and they offer an opportunity for agents to capitalize on what I call marketing micro-moments. Marketing micro-moments are those brief periods when it’s most crucial for independent agents to communicate with their audience. It’s vital to connect with customers and prospects at that exact moment (e.g., a prospect is ready to make a purchase or identified a new problem, or the person would be a perfect candidate to attend an upcoming event that your agency is hosting). Regardless of the reason, the concept of a marketing micro-moment is that the quicker you communicate with your current or prospective clients about the purpose or intent of the moment, or micro-moment, the better. Attention getters When those notifications show up on an app, most people don’t ignore them for long. So, push notifications can put your agency’s message right into the palm of your audience’s hands, quickly and effectively. In fact, a study by Thanx, a customer loyalty firm, looked at 17 different kinds of push notifications, including transaction-triggered notifications (when customers receive notifications to their phones after completing a purchase) to special offers, survey completions and more. The team’s primary focus was on the retail space. They concluded that— 6

depending on the push—these notifications can have open rates ranging from 47% to 80%. Within the insurance industry, we receive an average open rate of about 90%, based on data from GoInsuranceAgent. Considering that the insurance industry’s average email open rate is about 10%, it should be obvious that push notifications can deliver power for your agency. Varied results So, why are push notification statistics so skewed? Let’s look at some of the data from Thanx. As mentioned, there are multiple kinds of push notifications. The nature of the notification can and does affect its overall performance. On the high end, an 80% open rate is par for the course for notifications such as rewards, VIP perks (e.g., exclusive offers, rewards or opportunities available only to select members), and beacon reminders (i.e., when a customer has a reward waiting and receives a friendly reminder). On the low end of push notifications, which can have as low as a 20% open rate, is over-communication from major brands. If a push notification doesn’t cover a marketing micromoment, then it may not be the best way to communicate the message. Abusing the power of pushes by communicating on less relevant subjects about the agency will cause notifications to lose traction. If pushes are used incorrectly or too frequently, people will become desensitized to them and assume they are of little value. Your experience Push notifications almost have unlimited potential for your agency, as do mobile apps. If you’re excited about the power of push notifications and micro-marketing moments, but you don’t have an app for your agency, that would be the place to start. Having a mobile app allows you to take the digital experience to the next level for all your clients and even prospects. With a mobile app, your agency doors can be open 24/7, because you can provide services for your clients around the clock—even if your physical agency office is closed. Apps can allow customers to create inventories of their valuables, get help with claims, store digital ID cards, get in touch with agents however they choose and even get step-by-step help in an emergency. This article is adapted from QS90893, which can be found in the PIA QuickSource library (www.pia.org).

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Protect your agency: Copyright and trademarks Several years ago, Lebron James filed a trademark application for the phrase Taco Tuesday that, predictably, caused an uproar on the internet. Apart from the fact the internet consistently needs to get outraged over something, it struck many rational people as a bit ridiculous. At some point, most people either have used the phrase Taco Tuesday, have known a dad who says it any time he makes tacos, or have seen the original Lego Movie.1 Surely, Cleveland dad Lebron James could not trademark the phrase? Apparently, the U.S. Patent and Trademark Office agreed with the internet when it denied the application as the phrase Taco Tuesday was too common of a phrase in everyday speech. While all food bloggers breathed a sigh of relief that they would not need to defend themselves for using the phrase on InstaSBP_PIA_HalfPageAd_031521_x1a.pdf

3/15/21

7:18 AM

gram, it still seemed a bit ridiculous that James would even try to trademark such a common phrase.

LEGAL

CLARE IRVINE, ESQ. Government affairs counsel, PIA Northeast

He responded to the hullabaloo by explaining he knew this. The purpose of the application had been to confirm that no one could trademark the phrase, so he could join other dads in posting about his family Taco Tuesdays on Instagram. Instead of applying for a trademark to obtain protection for a piece of

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intellectual property, he did it defensively to avoid issues for future references to Taco Tuesday. Independent insurance agents may not attract the same scrutiny over what they post on social media as the star of Space Jam: A New Legacy2 did, but that does not make them immune from the reach of intellectual property laws. Such laws can protect one’s brand, but also can expose an individual to legal consequences (financial penalties and hefty legal fees). The key to navigating what you need to do begins with understanding both the laws behind the main areas of intellectual property law that apply to branding and advertising.

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The basics of © and ™ Intellectual property laws were created to do exactly what the term implies: protect the intellectual work of their creators. However—like all basic legal concepts—it quickly becomes much more complicated. For the purposes of branding and advertising, the two areas of intellectual property law that business owners should have a familiarity with are trademark and copyright protections. Trademark and copyright protections complement each other. Copyright protects the written work (combination of words) of the author while a trademark protects a symbol, which could include words. Author J.K. Rowling has a copyright for each Harry Potter book’s text and certain words and phrases from the books, such as Azkaban and Hogwarts, have been trademarked. These protections mean I cannot simply copy-andpaste Rowling’s book and pass it off as my own in the United States. I can use phrases protected by trademark in this article to explain trademarks, but I cannot start my own Hogwarts School of Witchcraft and Wizardry without obtaining permission from the trademark holder. Neither of these protections lasts forever. Due to the advocacy efforts of musician-turned-Congressman, Sonny Bono, copyright protections extend for the author’s life plus 70 years if created after Jan. 1, 1978, or 95-120 years from publication if work-for-hire. This allows the author’s estate to continue benefiting from the author’s work while eventually ensuring classic books (the ones everyone recommends, but no one reads) enter the public domain. As a result, anyone can publish a collec-

tion of Jane Austen’s work without fear of a lawsuit. Trademarks have no set duration, at least not to the degree of a copyright. They require the owner of the trademark to continue to use the symbol or phrase. A company cannot simply register a trademark solely to block individuals from using a symbol indefinitely. Companies also must ensure the words or phrases do not become so commonly used that they lose their uniqueness. Google goes to great lengths to ensure its name remains trademarked even if many people use it freely as a verb.3 Slogans may be trademarked if distinctive, either inherently distinct or proven to have acquired distinctiveness.

in the United States may apply for a trademark to register their phrase, symbol or name. Once registered with the U.S. Patent and Trademark Office, the branding may be identified as a trademark with an ®. Copyright registration requires less backend searches to register one’s work, which includes websites. If registering a website, only the original features of the design and text may be included in the copyright registration. Many businesses setting up websites rely on templates or a web designer’s standard HTML programming—neither of which may be included in a copyright application by anyone other than the original writer of the code. Any work included on the trademark registration must be done by the applicant. This means that, if you use a standard template for a website, the template cannot

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® your © or ™ Before naming a business or running any advertising campaign, individuals or companies should check for any phrases or names they wish to use in the Trademark Electronic Search System.4 Searches should include similar names or symbols. Even commonly used words and phrases should be run through the TESS database as a quick way to reduce the risk of accidentally using someone else’s trademarked name or phrase. If it comes up that the word, phrase, or symbol already has been registered by another entity, then it’s back to the drawing board to think up something new. The lack of a registered trademark does not automatically mean it can be claimed by slapping a ™ next to the symbol, name or slogan. That must be determined through the application process—from determining a trademark is the best form of protection through proving it is distinct from existing trademarks and not a commonly used phrase, symbol or name. Anybody residing

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be included in the copyright registration, but the text you write for the various pages does qualify as original.

When to © or ® Intellectual property law has two overarching objectives: protect creative works and avoid consumer confusion. However, applying for and registering for a trademark may not be necessary to achieve these goals for small businesses. Separate from intellectual property laws, states have their own ways for businesses to register that includes confirming no similar business uses the same name. Insurance departments require agencies and companies to have distinct names to avoid consumer confusion. These registrations are required to operate as a business and receive an agency license in the state. These registrations achieve one of the primary goals of intellectual property law without going through the application process. Registering trademarks still does offer protection, particularly if your agency has invested in a thorough branding process. Trademark applications can be limited to special character marks, which focuses on the color, font, and/or design of the text and does not extend trademark protections to any use of the word or phrase. A business such as Delta Airlines cannot trademark the word delta, but it can register the specific formatting of the word as designed for advertising. Trademarks also can be registered at any time, allowing a business to turn a once-common phrase or word into an identifier of a product. Copyright does not have the same alternative to protecting a business name at the state level. For most businesses, websites have emerged as a key marketing tool and way to interact with customers. If your agency creates original content for your website, applying for copyright protection puts other businesses on notice that they cannot reuse your work without permission of the copyright holder. This also extends to images, videos, and recordings your business may create to promote the business. Registration of a copyright or trademark is necessary to pursue any legal challenges against someone wrongfully using your intellectual property. It’s not necessary to mark work as either © or ™ and claim ownership of the material. Placing a ™ in the upper right-hand corner of a name or mark asserts a trademark currently unregistered. It does not need to be used after every instance of the mark to assert the status of a trademark. To assert copyright of material, the © may be placed somewhere on the website or document with the year of publication and the name of the owner. Many websites now have these three elements at the bottom of every page along the elements appearing in podcast notes and below YouTube videos.

It’s all up to you All of this is a long way of explaining that individuals and businesses must decide for themselves what steps to take when protecting intellectual property. For many individuals and small, more-local businesses, asserting ownership without registration may be sufficient for protecting their branding and other intellectual property.

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In insurance, the licensing process and oversight by insurance departments greatly reduces the risk of other entities using your agency’s name. And, while Lebron James may have claimed to file trademark applications to have a rejection as evidence that he does not own the trademark for Taco Tuesday, most businesses can rely on the information generated by TESS to check their latest promotional slogans do not violate someone else’s trademark rights. Irvine is PIA Northeast’s government affairs counsel. For those who have not seen the brilliant commercial of The Lego Movie, Taco Tuesday is said no less than 10,000 times, and it plays a key part in the plot. 1

Unlike The Lego Movie, Space Jam: A New Legacy is a corporate branding commercial that does not come out as a compelling movie for the entire family.

NBC News, 2013

(nbcnews.to/3yAAGWA) U.S. Patent and Trademark Office (bit.ly/3AukNBA)

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Double your sales with one simple idea Recently, I came across an old sales book: Secrets of Closing Sales by Charles B. Roth. In the book, he discusses a group of salespeople in Detroit who tried a new idea and increased their sales by 100%. Then, he discussed another group of salespeople in New York City who used the same idea and increased sales by 150%. Finally, he cited several examples of individual salespeople who used the idea and increased their sales by as much as 400%. Once again, what’s the No. 1 key to business building and more sales? Right, activity. Making lots of phone calls and/or in-person calls on lots of strangers who are potential prospects. Key No. 2? Right, having great sales skills. The new idea he’s talking about ties in with key No. 2: sales skills, and these days, this idea is not a new idea, though few salespeople use it even though it is one of the easiest ways to increase sales in a relatively short period of time.

Practice, practice So, what is the idea? Role-playing. That’s right, role-playing. Good oldfashioned practice when you hone your sales skills—hopefully with other salespeople and your manager but if not, with a friend or family member, your dog, in the mirror, or simply by yourself. Either way, if you consistently practice all the prospect/ client sales situations you’re going to

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run into during the day, you’re going to get much better at answering questions much faster and as a result sell more. When you think about it, role-playing is akin to professional football teams practicing during the week before games on the weekend. In fact, college teams practice, high school teams practice, even Pop Warner teams practice. Can you imagine any professional sport team not practicing? I mean how could they expect to win many games, never mind a championship without practice? At the same time, it is interesting that we call ourselves professional salespeople, while many of us don’t practice. How can you expect to be among the best without it?

Best practices How do you get the most out of your role-playing? First, you want your responses to be scripted. I know there’s still some debate over scripts, though I don’t know why. Imagine your favorite movie scene. Got it? Great, it’s scripted. Your favorite TV shows (unless you enjoy reality TV—no judgements) are all scripted. Obviously, the actors and actresses have memorized and practiced the lines and scenes that you love, and you need to memorize your lines, too. You must have what you need to say scripted into as few words as possible— and use the most effective words possible. And, that leads to point No. 2 regarding role-playing which is: Your ultimate success will be as good as the content in the scripts and how well you know it. You could role-play all day, every day, but if you’re saying the wrong things, you won’t be successful. You want to be role-playing effective material and you want to make sure you know it cold. I should be able to wake you up at 3 a.m., give you a common objection, and have the answer roll off your tongue, no problem. How much should you role-play? In the beginning, or if you are new to sales, every day until you have all your lines memorized. Even at that point, it’s a good idea to do at least some role-playing every day. Also, sales meetings should have a role-play portion in which you role-play difficult sales situations you’re running into or important upcoming calls. If you are a sales manager or other sales leader, you should be walking by your people when they are in the office and hit them with objections and other sales scenarios. It still amazes me that when I start working with a new sales group and I go into the first meeting and start hitting them with objections and other situations they’re running into, almost 100% of the time even the veterans are winging their responses which, by the way, almost always start with something like, “Ahhhhh …” So, if you haven’t done so already, put together scripts with some great sales content for every situation and scenario you’re going to run into: every presentation, every cold call, every follow-up call, every objection, every stall, every close, everything. Then, start practicing those responses by role-playing them with other salespeople and your manager. I promise, if you’re making the necessary calls, you’ll see a good increase in your sales numbers.

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Chapin is a motivational sales speaker, coach and trainer. For his free eBook: 30 Ideas to Double Sales and his monthly articles, or to have him speak at your next event, go to www.completeselling.com. He is also the author of the 2010 sales book of the year Sales Encyclopedia (Axiom Book Awards). Reach him at johnchapin@ completeselling.com. PROFESSIONAL INSURANCE AGENTS MAGAZINE

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What’s your WHY? Get through the uncertainty and confusion

magine you are four years old, and suddenly you are lost in a strange place. Everything confuses you and nobody looks familiar. What do you do? You yell, “Mommy!” When you do, dozens of people called Mommy respond immediately, but no one is the one person you are looking for and want. You become more confused, frightened and frustrated.

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Insurance purchasers—who are perhaps not frightened—face similar uncertainty and confusion when searching for an insurance agency with which to do business. And, when they begin to look online for someone to help them, they often find similar names with no real distinction to help with their search. Naming an independent insurance agency is one of the first, and often most difficult, decisions a new agency principal makes. Unfortunately, what often is not considered carefully enough is what the name will tell the marketplace about what the agency does—what it specializes in, what it values, where it operates and, importantly, why it exists at all. In the past, when insurance was largely sold locally, and face-to-face, having a name which didn’t answer these questions was not necessarily an issue. Now, as insurance is increasingly sold with some kind of technical interface or across larger distances than the agency’s hometown, what an agency principal chooses to call his or her agency, and how he or she defines its identity are increasingly important.

Aligning name and brand Agencies have names and brands. Sometimes the brand is intentional, welldefined and it is supported by the agency’s name. More often, the brand is organic, having evolved (more or less unintentionally) over time. In these cases, the agency name usually has nothing to do with the brand. Think of your brand as your identity. It is who you are. It is who you tell the world (marketplace) you are. It also is who the world thinks you are. In a hyper-competitive market, this is important. So, what comes first, the brand or the name? In the 1800s, as cities grew and fewer people raised their own food, specialization in agriculture began to arise. At the same time, the western United States was opened for settlement. With vast grass lands available, cattle ranching operations proliferated across great distances. Often, in those unfenced days, cattle from one operation got mixed up with cattle from another. The problem of figuring out who a cow belonged to was solved with branding. And to keep things simple, the names of the cattle operations themselves evolved to make branding easier. Names like Bar T, which were easy to stamp on a cow, became the name and the brand. Everyone could understand where a given cow came from and to whom it belonged. This alignment of branding and naming reduced confusion. So, how should we align brand and name today?

Down to the Ponderosa Remember the Ponderosa? This fictional ranch had a cool name and it was owned by a family, the Cartwrights, on a great old television show called Bonanza. As I think about this show, it’s branding is both obvious and layered. Ponderosa is a pine tree that grows throughout the western U.S. It’s slender, but tough and strong. It’s also everywhere. The Cartwrights are telling the world something about themselves with this name. They, too, are tough and strong. They are everywhere. According to the Oxford Dictionary, Bonanza means a “sudden increase in 20

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wealth, good fortune, or profits.” Associating Bonanza with Ponderosa gives us an impression that’s intentional. We expect to see wealth, success, happiness and so on. While the Ponderosa ranch isn’t named after the Cartwrights, everyone knows they are the owners and what they stand for. We know they are honest and fair. We know they are big, but help the little guy. We know they are brave, fierce and protective. We know they are familyoriented, yet friendly to those they meet and with whom they do business. Not coincidentally, we also know they are craftsman, explorers and pioneers. We know this because that’s what the name Cartwright tells us. All these things are known because collectively they compose their brand. Their brand is carefully defined and consistently cultivated. It is aligned carefully with the names of their ranch, family and the show. Your agency can have a brand that is just as powerful.

What makes your agency unique? As you begin to think about your branding think about why you are in business. As you do, ignore the obvious descriptors like to sell insurance and dig deeper. Perhaps your mission is to build a legacy, to be a valuable member of the community, to be a great employer, to help people sleep at night, or to provide for your family. Maybe you are starting, or started, your agency to create a better way to market, sell or service insurance. Perhaps you didn’t like how customers or employees were treated elsewhere. There are endless whys to be in business. What’s yours?

Another why to consider is why anyone in the marketplace should care that your agency exists. Are you unique? Many agencies aren’t. If your agency is, what makes it unique? For example, when asked the question about uniqueness, virtually all agents answer with some description of their great service. By definition, if most or all agents answer a question about uniqueness the same way, it isn’t unique at all. What is it then that makes your agency unique in the marketplace? Perhaps it specializes in narrow niches. Maybe you solve unique kinds of problems. It could be that you exist to help small-business owners with all their risks, and only work with people who want all their insurance in one place. Today, many agencies are trying desperately to be the cheapest place to buy insurance. That’s no more unique than providing the best service. Think hard about why anyone would want to do business with you, and avoid thinking about price and service, which are both commodities. After all, why would anyone believe a business can be both cheap and have great service—unless you’ve built a unique way for that to be true (in which case the world will beat a path to your door). To define their uniqueness, an important question that agents should ask is who they seek to serve. If you know who your ideal customer is, you know not only who you’re looking for, but also a great deal about where to find them and how to speak to them. You’ll know this because you will have taken the trouble to understand their needs, values, buying habits and so forth. This is invaluable in making your own brand resonate with your intended audience.

Be a hero The narrower you can define your who target, the more effective your branding can be. One way to think about the universe of prospective customers is to use a question developed by Dan Sullivan, founder of The Strategic Coach program: “Who do you want to be a HERO to?” You only can be a hero to certain people or groups of people, and usually you become a hero for doing things that resonate with that group. It’s a narrowing question that forces you to develop your own uniqueness while answering the question about who you want to serve. By answering questions about who you say you are, why you are in business, your uniqueness and who you want to serve, you will understand the essential elements of your business identity better. In other words, these questions help you define your brand. And, how you express this to the marketplace begins with your name. When my partner started our agency, he wanted to focus exclusively on business customers in Oklahoma. He was answering some, but not all the questions I’ve suggested in the article. The name he gave the agency was Oklahoma Business Insurors. It wasn’t a bad name for who he wanted to serve and where he wanted to focus his efforts. However, it was pretty limiting—and, it became awkward as the agency developed opportunities to sell insurance outside the state. Then, when personal lines became more lucrative, it was hard to explain to their current commercial clients that the agency could help them with their personal-lines coverages, too. My point is to suggest that the brand can and should be narrower than the name. That’s because the answers to my branding questions may evolve or change for your agency over time. A great example of this is Apple Computers. When it started, its who was computer hobbyists and the product the company sold was a computer. Today, the name is simply Apple because the product line and target customers are much broader. It reaches a mass market interested in high-quality design and ease of use, and its product line has expanded beyond computers to consumer electronics and mobile devices as well. The company’s why remains to inspire customers with great design. Pulling this together means that your agency’s name, which identifies your business, should be broad enough not to limit your product line, geography or future. Your name can be whatever you want it to be. It should resonate with you and be something that gives you pride. But whatever name you give your agency, you also need to define what it means. That definition is your brand. In a crowded marketplace, growing ever-more competitive due to technology (which is, in turn, increasing the number of competitors in your geographical marketplace), the importance of branding your agency’s uniqueness, reasons for existence and value to well-defined and carefully understood customers and prospects is critical. When your well-defined and understood prospect is lost, confused and looking for mommy, your brand will help the person find you quickly, and recognize you when he or she does. Caldwell is an author, speaker and mentor who has helped independent agents create over 250 independent insurance agencies. Learn more by visiting www. tonycaldwell.net or contacting him at tonyc@oneagentsalliance.net. PIA.ORG

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LEX DANIELE Assistant vice president of marketing, Aon Programs

Respect your brand across the generations The delicate art of modernizing your agency

It’s a storyline that’s playing out in family-owned insurance agencies across the country. Baby-boomer parents who built the agency (or helped build the agency with their parents) are retiring and passing the business to their Gen X and millennial children—and the up-and-coming Generation Z. Transacting business with family—particularly the people who raised you—can be challenging, especially when you consider the strong emotional connection many owners have with the agency they created. And, there’s also the simple fact that running an inherited business—no matter how closely you worked with your parents before their retirement—is not an easy thing. It’s the reason only 30% of family-owned businesses last into a second generation, 12% extend into a third generation, and 3% stretch into a fourth and beyond, according to the Family Business Institute.

When a family-owned insurance agency transitions to the next generation, so many factors can play into its success or failure—but one of the biggest is the new owner’s ability to modernize the business while respecting the established brand. Stray too far from the brand as you make updates, and you risk losing clients. Don’t update enough to keep pace with the market, and you risk losing clients. While not an easy feat, modernizing the business in a way that respects the brand is certainly not impossible— and it’s worth it. After all, business evolution is critical to survival in the competitive and ever-changing insurance industry. The key is to resist the urge to make changes simply for the sake of change. You can avoid that trap by consistently asking two questions as you evaluate potential updates to the agency:

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1. Does this change fit with my mission and vision? and 2. Can I make a business case for this change? Keeping a sharp focus on these two elements will help you balance the need to modernize with the brand’s value. But sometimes, this is easier said than done. So, here are some tips to help you along the way.

Understand what your brand entails To many people, a brand means a logo, a tagline, maybe a website— but, it is so much more. Your brand encompasses the full experience your clients have with you, from what they see in marketing materials to the interactions they have with your employees. As advertising guru David Ogilvy once described it, it is, “the intangible sum of a product’s attributes.”

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There are several reasons for a small business to refresh a brand—ranging from an increased need to differentiate from your competitors, to the need to evolve a brand that hasn’t changed since it was launched in the 1970s. The transition of ownership is a good moment to evaluate that brand experience—its strengths, its weakness and more—and determine if you need to refine or update it. Unless you have a background in marketing, you’ll want to tap into outside resources to make sure you’re tackling the review and refresh process correctly and thoroughly. If hiring a consultant isn’t possible— don’t worry! There are some comprehensive resources online designed specifically for small-business owners to help them make sure their brand remains relevant and authentic as it matures.[EDITOR’S NOTE: You also can contact PIA Design &

Print to discuss various branding and marketing campaigns. For more information, email design.print@pia.org.]

Ask your clients Your clients should be at the top of your mind as you look to balance modernization with what people love about your brand. Find out what’s working and what’s not for your clients. What do they value about their relationship with your agency? And, what else do they wish you offered them? How do they feel about interactions with your team? What keeps them loyal? What would make them defect to a competitor? It’s important to skip the guesswork and do the actual legwork. Today, getting to know a client is an entirely different proposition than it was 10 or 20 years ago. With four generations converging from all walks of life, understanding what the client wants requires a more focused effort. Informal conversations can help inspire ideas and inform decisions, but to get a broader read on where your clients stand, consider executing a survey via a free or lowcost provider like Survey Monkey or Google Surveys. A survey—especially one that you can repeat annually—will give you actionable data on the things that really matter to you and your clients about the brand experience. This could include messaging that resonates, or what they perceive as the most valuable part of your relationship. To generate a good response rate, design your survey with an eye on remaining unbiased in your questions, and keeping it manageable in terms of the respondents’ time commitment. It’s helpful to ask a few members of your network (outside of

your agency) to review the proposed questions and flag any that might be leading or confusing. Then, as you finalize the survey, cap the final list at 10-15 multiple-choice questions, plus one open-ended question. The longer the survey, the higher the risk that your respondents will abandon it before they complete it. And remember, people love incentives—so randomly selecting two or five people who complete a survey to win a gift card can go a long way to getting you the data you want. Just remember, your state’s rebating laws when deciding your prize. In Connecticut, the prize can’t exceed $15; in New Hampshire and New Jersey it’s $100; and in New York it’s $25. You’ll want to avoid this practice altogether in Vermont, since the state does not allow this form of rebating.

Embrace data and insights Keep an eye on external industry data and insights, which will give you a solid grounding in the trends and issues driving the agency business, and help you determine where to invest your time and dollars as you modernize. Fortunately, finding those third-party insights and stats is an easy task—the real challenge is slimming down your search results. You can find the information you want in just about any format—traditional written news stories, podcasts, interactive graphics, videos, social-media posts, e-newsletters, and webinars—content is truly king. The trick is to identify the sources and formats that meet your needs—whether that’s a risk management magazine or a vertical industry association podcast—and make the commitment to consume content on a set schedule. Seek out the content that other agency owners, your colleagues and clients find to be the most informative and engaging. Once you find those sources, take advantage of push notifications and other alerts, so the content comes directly to you.

Create an advisory board When the same people with the same points of view are making decisions consistently, businesses can get stuck in a rut. To sidestep this issue before it happens, bring outside perspectives into the agency proactively. One way to do this is to set up an informal, mutually beneficial advisory board of peers, partners, vendors, colleagues and others to meet on a quarterly or bi-annual basis to talk about what everyone sees on the horizon in their disciplines—from industry specific issues and trends, to the general business headlines shaping their organizations and sectors. These varying perspectives can challenge your thinking as an owner and keep it fresh. They also can put potential issues and opportunities on your radar that you hadn’t even considered. If an advisory board is not in the cards, then—at the very least—embrace the spirit of this type of group. Make sure your network has a diverse mix of people who have complementary industry and business expertise, then commit to keeping in touch with them one-on-one on a regular basis—whether that’s monthly, quarterly or bi-annually. Also, getting involved in your industry associations is a great way to stay current on what is happening in the insurance industry.

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Don’t forget your employees Your employees can be a tremendous asset as you work to modernize the agency. Their client insights can be invaluable as you evolve the business, and long-time employees can provide that all-important historical knowledge. Engage them in conversations and solicit their opinions about the agency’s past, present and future and you will be rewarded.

agency, and prepare them to deliver a consistent message in both formal and informal client communications.

Finally, create an open dialogue and strive to build trust with employees as you navigate the leadership tranAnd, don’t forget that your employees also are the literal face of your agency sition together. The more transparto your clients. Make sure they understand the why behind changes in the ency, the better. It will help them feel more comfortable flagging any challenges or opportunities sooner rather than later, and make them more willing to share their ideas ofasOwnership Statement 13. Publication Title 14. Issue Date for Circulation Data Below (All Periodicals Publications Professional Insurance Agents September 2021 your business evolves. 16. Electronic Copy Circulation 15. Extent and Nature of Circulation

Average No. Copies No. Copies of Single Each Issue During Issue Published Preceding 12 Months Nearest to Filing Date

2263

1986

1871

1797

1871

1797

188

e. Total Free or Nominal Rate Distribution (Sum of 15d (1), (2), (3) and (4))

188

f. Total Distribution (Sum of 15c and 15e)

2059

1985

2063

1986

91%

a. Total Number of Copies (Net press run) (1) Mailed Outside-County Paid Subscriptions Stated on PS Form 3541 (Include paid distribution above nominal rate, advertiser’s proof copies, and exchange copies) b. Paid Circulation (By Mail and Outside the Mail)

(2)

Mailed In-County Paid Subscriptions Stated on PS Form 3541 (Include paid distribution above nominal rate, advertiser’s proof copies, and exchange copies)

(3)

Paid Distribution Outside the Mails Including Sales Through Dealers and Carriers, Street Vendors, Counter Sales, and Other Paid Distribution Outside USPS®

(4)

Paid Distribution by Other Classes of Mail Through the USPS (e.g., First-Class Mail®)

c. Total Paid Distribution [Sum of 15b (1), (2), (3), and (4)] d. Free or (1) Free or Nominal Rate Outside-County Copies included on PS Form 3541 Nominal Rate Distribution (2) Free or Nominal Rate In-County Copies Included on PS Form 3541 (By Mail and Free or Nominal Rate Copies Mailed at Other Classes Through the USPS Outside (3) (e.g., First-Class Mail) the Mail) (4)

Free or Nominal Rate Distribution Outside the Mail (Carriers or other means)

g. Copies not Distributed (See Instructions to Publishers #4 (page #3))

h. Total (Sum of 15f and g) i. Percent Paid (15c divided by 15f times 100)

* If you are claiming electronic copies, go to line 16 on page 3. If you are not claiming electronic copies, skip to line 17 on page 3.

a. Paid Electronic Copies

Transitioning an15c) +agency b. Total Paid Print Copies (Line Paid Electronic from Copies (Lineone 16a) generation to the next presents chalc. Total Print Distribution (Line 15f) + Paid Electronic Copies (Line 16a) lenges and opportunities for new d. Percent Paid (Both Print & Electronic Copies) (16b divided by 16c Í 100) owners. Modernizing the business I certify that 50% of all my distributed copies (electronic and print) are paid above a can help position the agency for 17. Publication of Statement of Ownership success, but it needs to be done in a If the publication is a general publication, publication of this statement is required. Will be p way that respects the attributes your in the ________________________ issue of this publication. clients love most about the brand. 18. Signature and Title of Editor, Publisher, Business Manager, or Owner

Keeping that in mind as the agency evolves will contribute to its I certify that all information furnished on this form is true and complete. I understand that anyone w continued longevity. or who omits material or information requested on the form may be subject to criminal sanctions ( (including civil penalties).

Daniele is the assistant vice president of marketing at Aon Programs, a brokercentric program that offers tailored insurance solutions to more than 300 specialty insurance programs. Daniele specifically leads the development of broker-centric marketing strategies while also helping individuals execute multichannel digital campaigns.

PS Form 3526, July 2014 (Page 3 of 4)

PS Form 3526, July 2014 (Page 2 of 4)

Conclusion

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e h t r o . f y n c o n i t e u g l a o s e l c a n t a o r t u T he de nt in s . w o r n r e o p m e o t d ind n a • y a d To

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Procedure for handling an important umbrella issue Virtually every year, approximately 5% of errors-and-omissions claims involve umbrella coverage. Some involve allegations of failure to place, failure to suggest, or exclusions in the umbrella form of which clients are unaware. Another primary issue generating E&O claims involves gaps when the underlying limits were not at the required level. As all agents should be aware, when listing a line of business (e.g., auto and boat) as underlying coverage on an umbrella policy, umbrella carriers require those underlying lines of business to be at a specific minimum level. When a loss occurs and the underlying limits are less than the required level, a gap occurs—and this gap then becomes the responsibility of the client. In most situations, this is when the client sues the agency. The following claim example further illustrates the issue: The umbrella carrier required a $500,000 combined single limit for the underlying auto coverage. The agency had advised the umbrella carrier that there was a $500,000 CSL in place for the client and the umbrella policy was issued showing this $500,000 limit. In actuality, the agent had only secured a 250/500 policy instead of the $500,000 CSL. A serious accident occurred resulting in significant bodily injury to a person in the other car. The case was settled for $3 million, with the auto carrier paying the $250,000 limit and the umbrella carrier paying $2.5 million—the umbrella carrier factored in the $500,000 limit that was supposed to be in the underlying auto policy. This resulted in a $250,000 gap, which became the amount of damages sought by the agency client when the client sued the agency. Lacking any real defense in the matter, the agency lost.

Best practices It is important for agents to realize that the underlying limits required by umbrella carriers are not always the same. There should be a strong focus on this issue—especially when the underlying coverages and the umbrella coverage are not with the same carrier. In addition, when an agent moves the umbrella to a new carrier, there should be a procedure to verify the underlying limits requirements of the new carrier. Consider these best practices for your agency’s process in dealing with umbrellas: Use common effective dates. When possible, the various underlying coverages and the umbrella should have a common effective date. If they don’t,

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E&O

CURTIS M. PEARSALL, CPCU, CPIA President, Pearsall Associates Inc.

work with the various carriers to accomplish this. Know the underlying limit requirements. When proposing umbrella coverage (new and renewal), the agent should know what the underlying limit requirements are and verify that those limits are in place. The required underlying limits may change, so be sure to know what the requirements are at the time of each subsequent proposal (new and renewal). Know the carrier requirements. If the agent is looking to move the umbrella to a new carrier, identify the requirements for the new carrier you are considering. They may not be the same as the current carrier’s requirements. Discuss the scheduled coverages. Discuss with the client all the coverages that can be scheduled (including uninsured/underinsured motorist coverage, if allowed) for the umbrella to respond at the time of a loss. If some of the policies are not written with your agency, advise the client in writing what the requirement is. Secure a dec page of those policies. It definitely is suggested to advise the client—again, in writing—that if any of the limits of the underlying coverages change, your agency must be notified, and that failure to do so could result in a portion of any loss not being covered.

Diversify your coverage options. Do not write just the umbrella coverage! This is a formula for disaster. If the client is moving his or her coverage to your agency, it is best to start with the various underlying coverages such as the auto and homeowners. It is not suggested to start with the umbrella policy.

Claims handling Another key issue involves the handling of claims when there is an umbrella in place. It always is suggested to put the excess carrier on notice, especially

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when the underlying claim involves death, dismemberment, brain or spinal injury, some other type of serious injury or a lawsuit. Even if the underlying carrier and the excess carrier are the same, it is suggested to put each on separate notice. Bottom line, every agency should have a procedure requiring a total review of the umbrella requirements and whether those limits are being satisfied at the time of the placement of the umbrella or any of the underlying coverages. Pearsall is president of Pearsall Associates Inc. and special consultant to the Utica National E&O Program. Utica National Insurance Group and Utica National are trade names for Utica Mutual Insurance Company, its affiliates and subsidiaries. Home Office: New Hartford, NY 13413. This information is provided solely as an insurance risk management tool. Utica Mutual Insurance Company and the other member insurance companies of the Utica National Insurance Group (“Utica National”) are not providing legal advice, or any other professional services. Utica National shall have no liability to any person or entity with respect to any loss or damages alleged to have been caused, directly or indirectly, by the use of the information provided. You are encouraged to consult an attorney or other professional for advice on these issues. © 2021 Utica Mutual Insurance Company

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Severability of interest, moving trucks and more Children away at school Q. We have clients who are asking us if their homeowners policies will cover their sons and daughters while they are away at college. Can you help us put together a succinct answer? A. Sure. A student who is under the age of 24, who is the homeowner’s relative, who is enrolled in school full time, and who was a resident of the household before leaving to attend school is considered an “insured.” Additionally, to ensure a relative who is a full-time or part-time student—who is 24 years old or older has coverage—the Additional Insured–Student Living Away From The Residence Premises (HO 05 27) endorsement can be added to the homeowners policy. The homeowners policy states the limit of liability for personal property usually located at an “insured’s” residence, other than the “residence premises” is 10% of the limit of liability for Coverage C, or $1,000, whichever is greater. Theft of property located at school is covered if your child has been there at any time during a specified number of days before the loss (ISO 2011 edition is 90 days). All the normal personal property policy limitations apply to the collegiate away at school. These limitations are called special limits of liability and limit coverage to specified amounts for such property as money, jewelry and tickets. Some insurance companies have a special limit for computers, and there is a limit that applies to the unauthorized use of credit cards and fund-transfer cards. Children away at school are covered for bodily injury or property damage they cause to others when held legally liable for their actions. Included is the liability children have for a hazardous condition in the dorm room, since this location is covered automatically as a premises not owned by an insured; and where an insured is temporarily residing. However, your children are not covered for liability they incur from unlawfully furnishing alcohol to others who become involved in an auto accident. —Helen K. Horn, CIC, CPIA, CISR

Health-care exchanges–broker compensation Q. Can brokers sell insurance through a health care exchange? And, can they be compensated?

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A. Yes. Brokers and agents can sell plans offered through a health care exchange. However, the compensation models vary by state. Some states allow agents and brokers to receive commission directly from the carrier offering the plan, while others pay commission from the exchange, which first collects it from the carrier. The Centers for Medicare and Medicaid Services issued a statement on it as follows:

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Federally facilitated marketplaces, including state partnership marketplaces, will not establish a commission schedule or pay commissions directly to agents or brokers. As is the case in the market today, we expect that the amount and terms of any commission would be negotiated by the issuer and the agent or broker. However, we note that HHS has established a QHP certification standard for issuers seeking certification in federally facilitated marketplaces and federally facilitated SHOPs that would require QHP issuers to pay the same agent and broker compensation for enrollment through the federally facilitated marketplaces and federally facilitated SHOPs. So, federally administered exchanges will pay commission to brokers, but

they allow them to continue their existing compensation with carriers.—Clare Irvine, Esq.

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A. The weight of the vehicle has nothing to do with this coverage.

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The ISO Personal Auto Policy covers the insured for any vehicle not excluded. There is no exclusion for a truck—unless it is used for business purposes. —Dan Corbin, CPCU, CIC, LUTC

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Severability of interest

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Q. I have a bank requesting a Severability Of Interest endorsement on a general liability policy for a co-op building. We are seeing this request more often from banks, but we are not sure what it accomplishes.

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A. The Severability Of Interest endorsement—more commonly included in the coverage form as the Separation Of Insureds provision—is applicable to each insured covered by the policy. It reads as follows:

employees.

7. Separation Of Insureds Except with respect to the Limits of Insurance, and any rights or duties specifically assigned in this Coverage Part to the first named insured, this insurance applies: a. as if each named insured were the only named insured; and b. separately to each insured against whom claim is made or “suit” is brought. Essentially, each will be independently insured without the encumbrance of other insureds. So, if one of the insureds were declined for a claim, other insureds would remain covered as if separately insured. However, this endorsement in no way increases the limit of liability on a policy. As an example, if there were two entity’s named as insureds with a $1 million policy limit, each insured will be treated separately, but the limit of liability is not doubled.—Dan Corbin, CPCU, CIC, LUTC

116225 919

Damage by rodent

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Q. The lights went out on my client’s Thunderbird. The mechanic found a mouse that had been chewing on the wires. Can a claim be made under the comprehensive coverage? A. Yes. Part B–Physical Damage is an “open” peril coverage, limited only by applicable exclusions. In this case the proximate cause of loss is not excluded. —Dan Corbin, CPCU, CIC, LUTC

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As of publication date. For more information go to pia.org. Insurance Agents/October 2011 Professional

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