APRIL 2020 | PENNSYLVANIA
MEMBER SPOTLIGHT ON
MARY PEPPELMAN
Exclusive Member Magazine
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EVERYTHING THEY NEED TO TAKE ON TOMORROW Your customers’ peace of mind is our top priority. We offer comprehensive protection, including auto, home, and business coverages. Trust in Tomorrow.® Contact us today. To find out more about what we can do for you and your customers, contact our Pennsylvania representative, Harry Larkin, at harry.larkin@grinnellmutual.com. AUTO | HOME | BUSINESS
* Products available in Pennsylvania only
grinnellmutual.com “Trust in Tomorrow.” and “Grinnell Mutual” are registered trademarks of Grinnell Mutual Reinsurance Company. © Grinnell Mutual Reinsurance Company, 2020.
IN THIS
16 ON THE COVER: Q&A WITH MARY PEPPELMAN
IA&B Member Agent Mary Peppelman talks about working with her dad, redesigning their agency website, and her passion for theater.
18 SELL MORE WITH VIDEO PROPOSALS
Learn why – and how – an increasing number of insurance producers like to send a short video along with their quotes and proposals.
22 THE SECRET TO E-SIGNATURE BLISS
Discover two powerful, time-saving techniques with e-signatures to eliminate repetitive tasks and finish work efficiently.
IN EVERY ISSUE 2 3 4 6 8 12 15 26 29 29
Chair of the Board’s Message Don’s Discussion Preventing Errors & Omissions New & Returning Members Coverage Corner News & Notes IA&B Partners Pics & Posts Training & Education Classified Ads
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About IA&B IA&B is the premier resource and champion for independent insurance agents in Pennsylvania, Maryland, and Delaware. Periodical postage paid at Mechanicsburg, Pa. and at additional mailing offices. Postmaster: Send address changes to Insurance Agents & Brokers, 5050 Ritter Road, Mechanicsburg, PA 17055. Primary Agent (ISSN 1543-3110), Permit # 638-620, Issue # 2020-4, is published monthly by IA&B Service Group Inc., a subsidiary of IA&B.
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Copyright 2020. All rights reserved. No material may be reproduced in whole or in part without written consent of the publisher. The information in this publication is general in nature and not intended to serve as legal, accounting, financial, insurance, investment advisory or other professional advice as to any reader’s particular situation. Users are encouraged to consult with competent legal, financial, insurance, investment advisory and/or other professional advisors concerning specific matters before making any decisions. We disclaim any responsibility for any decisions or actions by readers. Statements of fact and opinion in Primary Agent are the responsibility of the authors alone and do not imply an opinion on the part of the officers or the members of IA&B. Participation in IA&B events, activities and/or publications is available on a non-discriminatory basis and does not reflect IA&B endorsement of the products and/or services.
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CHAIR OF THE BOARD’S MESSAGE
BOARD OF DIRECTORS INSURANCE AGENTS & BROKERS
REASONS FOR YOUR RENEWAL
5050 Ritter Road | Mechanicsburg, PA 17055 800-998-9644 | IABforME.com
OFFICERS
Chair of the Board
S
Craig S. Mader Crofton, MD
pring is considered a time of renewal and rejuvenation. So it seems fitting that April 1 marks the beginning of a new IA&B membership year. If you’ve already renewed your agency’s membership, thank you. If you have yet to renew, I trust that you will soon. You will not want to miss what’s in the works. Just last month, IA&B staff completed a series of Member Agent Panels throughout Pennsylvania, Maryland, and Delaware. The meetings were productive and the discussion vibrant. Members shared their goals and challenges and weighed in on how IA&B can best support them. In the end, participating members identified and refined their priority issues, such as market access, talent recruitment, and employee management. And I’m happy to report that work is already underway at IA&B to address them. Beyond these initiatives, the IA&B Board of Directors is committed to the organization’s pillars – the benefits of membership you have come to rely upon, such as legal and compliance insight, governmental and regulatory advocacy, robust insurance programs for your agency, and (discounted) access to award-winning professional training. Truly, this is a worthwhile time to be a member of IA&B. I encourage you to come along for the ride and take full advantage of it.
Vice Chair of the Board
Richard M. Rankin, CIC Lancaster, PA
MEMBERS
Sarah M. Brown, CIC, CRM, AFIS Shrewsbury, PA
Emory Stephen Burnett, CIC, ARM Wilmington, DE
N. Lee Dotson, CIC, AAI Wilmington, DE
Andrew Enders, Esq. Harrisburg, PA
Michael P. Ertel Sr.+ Columbia, MD
Len Gieseler, LUTCF Pottstown, PA
G. Greg Gunn, CIC* Lemoyne, PA
Bryan C. Hanes, JD Hagerstown, MD
Lisa A. Leach Goth, CIC New Bethlehem, PA
Shannon Lipniskis Indiana, PA
Elizabeth H. Martin, CIC Millersville, PA
Respectfully,
Mark J. Monroe
West Chester, PA
Michael A. Papa, CIC, MBA Hunt Valley, MD
Jason Rodriguez
Wilmington, DE
Craig Mader Chair of the Board
D. Bradley Rosenkilde Jr. Hunt Valley, MD
Tara S. Silfies, CPCU Bethlehem, PA
Robert L. Smyrl Jr., CIC Hatfield, PA
J. Marshall Wolff, CIC, CPCU Easton, PA
* PA IIABA National Director + MD PIA National Director
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APRIL 2020
Don’s Discussion Claire-ification IA&B Legal & Corporate Affairs Director Don Bankus provided this month’s answer. Are you a member with a question? Contact Don to find the answer at 800-998-9644, ext. 603 or DonB@IABforME.com.
QUESTION: Can carriers use telematics data for claims investigation and settlement?
ANSWER:
The extent to which carriers can use data collected from telematics devices is primarily governed by two things: 1) the contract between the insured and the carrier and 2) the language in the respective states’ statutes, if any. As you know, for insureds who elect to use them, telematics devices – such as Travelers IntelliDrive, Safeco RightTrack, and Progressive Snapshot – measure several elements of interest to carriers (miles driven; time of day; the location of the vehicle; rapid acceleration; and hard braking and cornering). It’s argued that such usage-based information makes premium pricing more individualized, rather than relying on aggregated statistics and driving records based on past trends and events.
WHAT DO USER AGREEMENTS SAY ABOUT CLAIMS? A review of several carriers’ telematics device agreements reveals that most, but not all, include language expressly addressing the use of the data for claims purposes. The following excerpts represent examples: Travelers (March, 2017, IntelliDrive End User License Agreement): Section 8. Monitoring; Analysis: Travelers may use data for premium calculation and research purposes. If we provide data to you or a third party, whether pursuant to a legal obligation or otherwise, we may use
that data in connection with the reasons for which it was disclosed, to protect our and our affiliates’ interests, for claim adjudication [emphasis added], and any other purpose. Progressive (June, 2019, Snapshot Plug-in Device Terms & Conditions): Acknowledgement/Vehicle Owner Consent: You agree we may analyze Snapshot Data for detecting whether an accident may have occurred and offering assistance to you at the scene. In the event you have an insurance claim with us, you agree we may use Snapshot Data to assist in resolving the claim. [emphasis added] This may include, but is not necessarily limited to, validating the circumstances of the incident, such as date and time of loss, crash location, and any potential subrogation or litigation involving the claim.
STATUTES AND REGULATIONS Of our three states (Pennsylvania, Maryland, and Delaware), only Delaware has a statute which addresses use of telematics data. Since the statute does not expressly address the use of data for claims purposes, it therefore does not prohibit use for that reason (see 18 DE Code, Section 3918 – Vehicle datareporting device). Delaware’s statute requires consent of insureds for purposes of data collection and use.
Maryland’s General Assembly recently introduced legislation, which, among other things, would expressly allow for use of collected data for claims investigation. If passed, the legislation would require consent of insureds for data collection and use (see MD HB 267 of 2020). Pennsylvania does not presently have any statute or pending legislation which addresses the issue. Without a statutory prohibition, the agreement between the insured and the carrier would govern on the issue.
THE BOTTOM LINE If the agreement between the insured and carrier permits use of collected data for claims purposes, and there are no state statutes or regulations which prohibit it, then the use of collected data for such purposes would be permissible.
This document is not a legal opinion and should not be relied upon as such. The intent of this document is to provide a general background regarding the topic or topics discussed, not to provide legal advice. Producers and agencies should consult an attorney regarding specific situations and specific questions with respect to the topic or topics covered in this document. Neither the Insurance Agents & Brokers nor any of its employees shall be responsible for any errors or omissions regarding any statements made in this document, nor any errors or omissions regarding any statutes, regulations, court rules, and/or any other government documents cited in this document.
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PREVENTING ERRORS & OMISSIONS
REQUESTS FOR THE DISCLOSURE OF INFORMATION IN AN INSURED’S FILE Prevent E&O by Properly Handling Inquires By James C. Keidel, Esq.
O
ne of the more common questions that we receive from insurance agencies and brokerages is how to handle requests for the disclosure of information that is contained in their insured’s file. If such a request is received and handled properly, an agency or brokerage can help reduce the likelihood of becoming involved in an E&O claim or lawsuit. In this article, we will review some of the procedures that an agency or brokerage should follow if it receives a request from an insurance company, an insured, an attorney, or anyone else,
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to disclose information regarding that is contained in an insured’s file.
NOTIFYING YOUR E&O INSURER When an agency or brokerage receives any type of request to provide information or documents regarding an insured, the agency or brokerage should be sure to handle that situation with care. Such a request may potentially constitute a claim against the agency or brokerage, or possibly contain facts which give rise to a potential claim; both of which would require that notice be given to the
APRIL 2020
E&O insurer for the agency or brokerage pursuant to the terms of its insurance policy. E&O insurance policies, like other types of insurance policies, require that insureds provide prompt notice of not only actual claims, but also notice of any circumstances that may give rise to a potential claim. For this reason, we advise agencies or brokerages that when they receive a request for any to be disclosed concerning an insured, they should consider whether they need to report that situation to their E&O insurer.
Providing prompt notice to the E&O insurer will ensure that if the situation eventually develops into an E&O claim or lawsuit, the E&O insurer cannot take the position that it was not timely notified of the situation. It is very difficult for an insurance agency or brokerage, faced with a late notice situation under its own insurance policy, to claim that it was not familiar with, or did not understand, the claims reporting requirements contained in its professional liability insurance policy. Also, E&O insurers will often appoint counsel to assist the agency or brokerage in dealing with the request for the disclosure of information, since having counsel involved helps reduce the chance of the situation developing into and E&O claim or lawsuit.
HANDLING REQUESTS FROM CARRIERS One of the more common requests we see in our practice is where an insurance agency or brokerage is asked by an insurance company to provide either information or documents concerning an insured. One thing to keep in mind is that if an agency or brokerage is faced with a request made by an insurance company to disclose information regarding an insured, it is usually in connection with the insurer’s investigation or denial of a claim. Insurance companies will often contact the agency or brokerage during the course of its claims investigation and request that the agency or brokerage provide either a written or recorded statement or copies of its file materials. If the insurance company conducting the investigation is one that the agency or brokerage has an agency agreement or an ongoing relationship with, the insurance company may take the position that the agency or brokerage is obligated to provide the requested information.
Any agency or brokerage faced with this situation must remember that, under most circumstances, it does not have a legal obligation to provide this information. Also keep in mind that if this information is provided by the agency or brokerage to the insurance company, and then that information is subsequently used as a basis for the denial of an insured’s claim, it is quite possible that the agency or brokerage will then become involved in any litigation arising out of the insurer’s denial of the claim.
HANDLING REQUESTS FROM INSUREDS Agencies and brokerages are also often asked by their insureds themselves to provide information or documents from the files that are maintained by the agency or brokerage. If this should occur, remember that an insured is not entitled to obtain copies of file materials maintained by the agency or brokerage that relate to his or her insurance. The documentation that is created and maintained by the agency or brokerage, constitute its business records; as such, that documentation is the property of the agency or brokerage. We understand that sometimes when an insured requests information or documentation from its files that the agency or brokerage may be inclined to provide that information in order to foster good will and maintain the relationship, even though there is no legal obligation to do so. Accordingly, if an agency or brokerage is faced with such a situation and would like to comply with the request, it should do so on a limited basis and provide the insured with only those documents that the insured would have received in the ordinary course of the relationship. For example, the agency or brokerage may provide the insured with copies of insurance policies, endorsements,
certificates of insurance, letters and other communications that they may have received in connection with their insurance. However, the agency or brokerage should not disclose to the insured such items as notes, records from the agency management system, or any internal communications within the agency or brokerage. In our experience, an insured will often request copies of this type of information if they contemplating a potential claim or lawsuit against the insurance company and/or the insurance agency or brokerage. Similarly, if the agency or brokerage receives a request for information or file materials from an attorney for an insured, this should likewise be reported to the E&O insurer. Our experience has shown that when an insured goes so far as to enlist the services of an attorney to inquire into the practices of an insurance company, or the agency or brokerage, an E&O claim or lawsuit is likely to follow.
HANDLING A SUBPOENA As you could imagine, an agency or brokerage should proceed most cautiously when it is served with a subpoena seeking information or documents. Although the agency or brokerage is may be nonparty to the legal proceeding in which the subpoena was served, a legal proceeding is, in fact, pending and it is very easy for the agency or brokerage to be added as a party to that proceeding. Often agencies and brokerages served with subpoenas simply comply with the subpoena served and provide the requested testimony or documents without the assistance of an attorney. While it is true that an agency or brokerage that is properly served with a valid subpoena has an obligation to comply or risk being held in contempt of court, we recommend that an attorney always be involved to assist in responding. Many times a subpoena is defective in some manner because the attorney who
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PREVENTING ERRORS & OMISSIONS
served it either failed to comply with the strict legal requirements governing the manner in which service may be made or the scope or type og information that may be requested. If an agency or brokerage simply complies with a subpoena without the assistance of an attorney, they may be providing information that they are not legally required to disclose and put itself at risk of becoming involved in an E&O claim or lawsuit. Our final recommendation on this topic is that every agency and brokerage should make certain that all employees are aware of the procedures to be followed within the agency or brokerage if it receives a request to disclose information concerning an insured. We suggest that all such inquiries be directed to one person at the agency or brokerage so that the requests are handled properly and consistently. The prudent insurance agency or brokerage that follows the procedures that we have outlined above will help reduce the likelihood that the request for information will develop into something much more serious, such as an E&O claim or lawsuit. Provided by the partners of Keidel, Weldon & Cunningham, LLP, which concentrates its practice in the defense of insurance agents and broker’s errors and omissions claims and litigation, errors and omissions loss control counsel and education, insurance coverage analysis and litigation, and insurance regulatory matters. Please direct any comments or questions to James C. Keidel, Esq. at jkeidel@kwcllp.com. The law firm maintains offices in Connecticut, Florida, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont. © 2019 Big I New York and Keidel, Weldon & Cunningham, LLP. Reprinted with permission.
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NEW MEMBERS CENTURY SURETY BONDING LLC Sykesville, MD
RAY E HYKES INSURANCE Frederick, MD
DONALD E KNIGHT NATIONWIDE INSURANCE Bel Air, MD
RODGERS INSURANCE AGENCY Baltimore, MD
EDWARD TOMASKO JR ENTERPRISES INC Waldorf, MD EICHHORN INSURANCE AGENCY INC Severna Park, MD GIBSON INSURANCE Accokeek, MD HALKOS INSURANCE AGENCY Laurel, MD HERBERTA J JONES INSURANCE Suitland, MD INSURANCE ONE GROUP Gaithersburg, MD JACK HUTCHISON INSURANCE AGENCY Severna Park, MD
W STAPLES INSURANCE FINANCIAL SERVICES Salisbury, MD WILLIAM L GREGG INSURANCE Clinton, MD WM KEITH EDWARDS INSURANCE Bethesda, MD YOUNG INSURANCE & FINANCIAL INC Baltimore, MD HOMESALE INSURANCE SERVICES LLC Lancaster, PA HOWARD HANNA INSURANCE SERVICES INC Pittsburgh, PA J P WOLFE INSURANCE INC Shiremanstown, PA
JOHN PHILIP INSURANCE INC Bel Air, MD
MARNIC INSURANCE AGENCY INC Beaver, PA
JOHN T UNDERWOOD INSURANCE Bethesda, MD
RETURNING MEMBERS
JONES INSURANCE AGENCY INC North East, MD JOSEPH SWANN INSURANCE Columbia, MD LINES INSURANCE & FINANCIAL SERVICES Laurel, MD LURAY & ASSOCIATES INC Pikesville, MD MARK STROVEL INSURANCE LLC Baltimore, MD PARKER INSURANCE SERVICES Annapolis, MD
APRIL 2020
MARION MILLER & ASSOCIATES Rising Sun, MD MAURY DONNELLY AND PARR Baltimore, MD REEDER INSURANCE FINANCIAL SERVICES INC Nottingham, MD RICK GERETY & ASSOC INC Bel Air, MD L N DEWEY CASTOR INC Huntingdon Valley, PA
From buttons to bread EMC has it covered. EMC Insurance Companies offers comprehensive coverage tailored to the needs of 98 different types of light manufacturers producing everything from buttons to bread to electronic components. This line offers optional coverage for manufacturers and delivery errors or omissions, plus employment practices liability. Certain coverages are even bundled automatically — meaning whatever your clients make, EMC makes insuring their businesses easier.
www.emcins.com/lightmanufacturing ŠCopyright Employers Mutual Casualty Company 2020. All rights reserved.
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COVERAGE CORNER
COMMERCIAL DRONE LIABILITY: FLIGHT OR FIGHT? By Kevin C. Amrhein, CIC
H
ard to believe that it’s been six months since the day commerce – and dare I say, the world – changed forever. I get chills recalling the October day when residents of Christiansburg, a city of around 22,000 in southwest Virginia, became the first in America to watch drones (legally) deliver packages to their neighbors’ homes. The city was the first approved by the FAA to allow package delivery via drone to the public. Residents wanting in on the fun order certain products –
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like medicine, snacks, or gifts – from select vendors like Walgreens. Vendors partner with Wing – a subsidiary of Alphabet (parent company of Google), which operates the drones from a distribution facility in town called the “Nest.” After an order is placed, the drone hovers at around 20 feet during pickup and lowers a tether used by a human (how retro!) to attach the package, which it (the drone) secures. After flying to its destination – typically the buyers’ yard or driveway – it lowers and releases the package. And that, my friends, is how history begins.
APRIL 2020
I concede that most insurance folks reading this article are not (yet) overrun with requests to insure the few organizations currently involved in drone package delivery. However, through discussions in my classes, agents have shared many ways their insureds are incorporating drones into their business practices. The innovation is, in a word, awesome. But this is, after all, a column about insurance, so I suppose it’s time I tell you why I’m doing this to you. While many agents concede that drones are a reality in their commercial book of business,
they admit they’re unclear on coverage. Specifically, liability coverage should use of a drone cause BI, PD, or be involved in an offense normally addressed by P&AI. A few years ago, the ISO (our policy language overlords) introduced options to amend the language of its standard CGL. Absent such amendment, does an ISO CGL cover drone liability? The answer is … maybe.
THE UNAMENDED ISO CGL – BI AND PD Regarding Coverage A – BI and PD – an adjuster likely would look to exclusion g. Aircraft, Auto Or Watercraft to remove drone-related liability. The term aircraft is not specifically defined in the CGL. However, drones are considered aircraft under federal law for regulatory purposes, and a variety of sources broadly define the term aircraft in a way that would include a drone. An exception to exclusion g. is worth noting: This exclusion does not apply to … (4) Liability assumed under any “insured contract” for the ownership, maintenance or use of aircraft or watercraft; For example, your insured is a roofer who signs a subcontractor agreement to indemnify the GC should the roofer’s drone cause BI or PD. The roofer hits a neighboring home with the drone, causing extensive damage. That homeowner files a claim for damages against the roofer and GC. Provided its definition of “insured contract” is without amendment (and that no other exclusions apply), the roofer’s CGL would exclude
claim expenses incurred by the roofer but would cover those incurred by the GC due to the exception. Could a photographer agree to indemnify a party venue? Could a land surveyor indemnify a developer? It’s easy to see the value in this exception. Unfortunately, the broad exception isn’t unnoticed by CGL insurers which continue to reduce the number of class codes eligible for an unamended CGL. More on this in a moment.
THE UNAMENDED ISO CGL – P&AI Coverage B – P&AI – responds only to specific offenses which are subject to several exclusions. However, unlike Coverage A, Coverage B does not contain an exclusion specific to the use of aircraft. For example, your insured is a photographer who is hired to take aerial photos of an outdoor event. The photos are published online and include a clear image of a person who argues he/she did not consent to his/her likeness being published. The person alleges a violation of privacy committed by your insured and indicates intent to file for damages. This allegation is addressed by the offense in part e. of the definition of “Personal and advertising injury:” e. Oral or written publication, in any manner, of material that violates a person’s right of privacy;
AN HOUR WITH KEVIN Earn 1 CE credit from new hour-long webinars, featuring the alwaysentertaining IA&B Education Consultant Kevin Amrhein, CIC. Drones – Insuring Innovators, Enthusiasts, and Idiots APRIL 28 2-3 PM
Annoying Personal Auto Problems and Their Solutions APRIL 29 11 AM – NOON
Register today. IABforME.com/webinars 800-998-9644, option 1
Absent an applicable exclusion, costs associated with this claim would be covered. continued on page 11
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OPEN SEMCI Single-entry, multiple-company interface (SEMCI) is like magic! Acuity, long recognized as a leader in agency interface technology, is committed to supporting SEMCI in commercial lines. SEMCI drives efficiency in the quote and application process and allows you to choose how you want to do business with Acuity. Acuity currently partners with several of the leading commercial lines insurtechs. We are building, exploring partnerships, or expanding with numerous other independent agency technology solutions. And Acuity is on the forefront of integration technology, continually building the connections necessary to be ready to connect to new insurtechs as they emerge.
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COVERAGE CORNER
continued from page 9
THE PARTY POOPER As commercial drone use and exposures evolve, fewer insureds should expect an unamended CGL. A common endorsement is CG 21 09 – Exclusion – Unmanned Aircraft which broadens Coverage A’s exclusion g. by removing the exception for drone liability assumed in an “insured contract.” Further, this endorsement excludes Coverage B claims involving the use of drones.
With PIN, you have the power to give your clients more!
COMMERCIAL DRONE LIABILITY – CONCLUSION/TAKEAWAYS • Assume that any commercial account currently or soon will incorporate the use of drones. • Review the CGL to determine if coverage has been amended. • If amended, consider coverage options. For certain class codes, some CGL insurers may offer endorsements to buy back coverage on a broad basis. In other cases, the CGL insurer may offer a buyback only on per operation/project basis. For example, the insurer may offer the CG 24 50 – Limited Coverage For Designated Unmanned Aircraft endorsement which requires the insured to specifically describe the drone, describe the operation/project it will be used for, and select an aggregate limit of insurance. That’s all for now. Until the next round … cheers!
Our focus begins and ends with your agency. Backed with the power of our team you have access to many of the nation’s highly sought-after commercial lines insurance companies — giving you a fuller array of coverage, better pricing, and the expertise you need to stay one step ahead of the competition.
Ask how you can become a PIN Member.
320 Granite Run Drive Lancaster, PA 17604-3320
Producernet.com 717-581-9284
Kevin C Amrhein, CIC, is IA&B‘s education consultant. He works with our CISR and CIC programs, as well as our special topic seminars and live webinars. Catch him at one of our upcoming professional training offerings: IABforME.com/education.
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NEWS & NOTES
The IA&B government affairs team has been active in Harrisburg, meeting with lawmakers, regulators, and other industry stakeholders to advocate on members’ behalf. Left to right: Government Affairs Director Lauren Brinjac; President & CEO Jason Ernest, Esq.; and Vice President – Advocacy Claire Pantaloni, CIC.
PA OVERTIME RULE RECEIVES REGULATORY NOD Changes to Pennsylvania’s overtime eligibility standards likely are forthcoming. The Independent Regulatory Review Commission (IRRC) approved the Pennsylvania Department of Labor’s final regulation during its Jan. 31 hearing. As a reminder, the now final regulation raises the threshold to potentially qualify for overtime exempt status to $875 per week ($45,500 annually) with automatic adjustments to the salary threshold thereafter. Please note: Pennsylvania’s final rule should not be confused with the adoption of the federal overtime rule that took effect on Jan. 1, 2020 and applies to all independent agencies.
Our Advocacy
What’s Next
IA&B, along with other business groups, provided verbal and written comments on the state’s revised overtime regulation throughout the regulatory process. Of note, we are concerned with the continued lack of uniformity with the federal overtime rule (driven by the Fair Labor Standards Act), forcing agencies to comply with different sets of complex rules.
The regulation does not go into effect yet. The Pennsylvania General Assembly has the opportunity to adopt a concurrent resolution disapproving the regulation, a process which began in February in the House Labor & Industry Committee. Watch Agent Headlines for updates.
Discrepancies between the state and federal rules include the: • Dollar threshold for exemption • Lack of a highly compensated employee exemption in PA • Stringent threshold for time spent out of the office to claim the outside sales employee exemption in PA
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APRIL 2020
INSIGHT ON PA HEALTH INSURANCE EXCHANGE Pennsylvania soon will transition from a federal- to state-based health insurance exchange, resulting from legislation signed into law last summer. To prepare for the change, IA&B recently welcomed staff from the new PA Health Exchange (the entity that will create, manage, and maintain the new exchange) to our office in Mechanicsburg to meet with a group of IA&B member agents. With the exchange scheduled to be fully operational for the Jan. 1, 2021 plan year, there is much to be accomplished. The group discussed a wide range of issues, including carrier guidelines, commissions, broker certification, and data migration/ software. IA&B hopes this was the start of a continued dialogue with the exchange that will continue over the coming months. Legislation to establish a state-based exchange was a priority for the Pennsylvania Insurance Department (PID) in 2019. The PID believes that the combination of transitioning to a state-based exchange (operating for less than the federal exchange) and obtaining a waiver for a reinsurance program will lower health insurance premiums in that market 5-10% without the need for any additional funds from the state.
WC RATES DECREASE LARGELY SPURRED BY FREQUENCY Effective April 1, 2020 on new and renewal policies, workers’ compensation rates overall will reflect a 10.08% decrease in loss costs. The reason is frequency, which continues to offset increases in severity. IA&B over the winter held its annual meeting with the Pennsylvania Compensation Rating Bureau to go over the latest loss cost filing. This year again, the continued drop in frequency is overtaking medical cost increases and improving trending to the tune of a 10.08% decrease. The trend is visible across broad industry groups (manufacturing, contracting, and others) and is consistent with many other states around the nation. While there has been an expectation that these frequency gains would eventually taper off, they have not done so yet. As always, individual classes will still see considerable variations, and the premium ultimately paid by your policyholders will depend on the Loss Cost Multipliers filed by those carriers.
APPLY FOR IA&B SCHOLARSHIPS Apply by May 1 for our next round of education scholarships. This spring, we’ll award scholarships for CIC institutes, CISR seminars, and live CE webinars to member agencies, as well as licensing exam prep scholarships to individuals. Since the 2019 launch of our scholarship program, we’ve provided approximately $19,000 in scholarships to individuals and member agencies to attend IA&B education courses. IABforME.com/scholarships
NY CYBERSECURITY FILING DEADLINE If you conduct business in New York, you must refile a fresh certificate of compliance annually with the New York Department of Financial Services. Agencies and individuals currently entitled to the limited exemption and those who are subject to the full requirements have until April 15, 2020 (an extension from the original Feb. 15 deadline) to comply. https://www.dfs.ny.gov/industry_ guidance/cyber_filings/requirements
WISH JERRY MILTON A HAPPY BIRTHDAY Our beloved former education consultant, Jerry Milton, CIC, turns 80 later this month. Join our card shower to wish him well! Send birthday cards directly to Jerry Milton at: 5017 Bay Drive Orange Beach, AL 36561
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IA&B PARTNERS PROGRAM
OUR FEATURED PLATINUM PARTNER Insurance Agents & Brokers proudly recognizes Donegal Insurance Group as one of its Platinum Partners. IA&B Platinum Partners dedicate the highest level of sponsorship to our organization. We have been providing quality property and casualty insurance protection since Donegal Mutual Insurance Company began doing business in 1889. Over the years, the Donegal Insurance Group has grown significantly and now writes property and casualty business in 24 states. The Donegal Insurance Group enjoys an A (Excellent) rating by the A.M. Best Company.
FEATURED PARTNER Donegal Insurance Group CHIEF EXECUTIVE OFFICER Kevin G. Burke President and CEO CORPORATE HEADQUARTERS Marietta, Pennsylvania A.M. BEST RATING A (Excellent) WEBSITE www.donegalgroup.com
As our operations have grown, we have expanded our ability to provide our independent insurance agents with a comprehensive suite of products. We have developed competitive commercial products that allow our agents to serve a broad spectrum of small, mid-market and larger commercial accounts. We work very hard to provide exceptional products and service in lines of business and markets that we know and understand well. At Donegal, we focus on providing superior technology and outstanding service to our agents and customers. We know that “ease of doing business” has become increasingly important to independent agents. Donegal has invested millions of dollars developing advanced technology that greatly enhances our agents’ and policyholders’ experience in doing business with us. Donegal has long recognized the value of an independent agent in assisting individual and business consumers navigate the insurance-buying process. Every day, we prove our commitment to the independent agency system by distributing our products exclusively through independent
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APRIL 2020
IABforME.com/Partners2020
agents. We are constantly looking for ways to deliver increased value to our agents and solidify company-agency relationships. We have benefited greatly from the feedback we receive from our regional agency forums, which helps us enhance our products and operations. Much has changed since we started in the insurance business more than 130 years ago, but one thing remains the same — Donegal remains firmly committed to delivering a better value to our agents and policyholders. We look forward to mutual success as we work together with our independent insurance agents in serving the insurance needs of our customers.
THANK YOU Thanks to these partners for supporting the independent agent network.
PLATINUM PARTNERS ACUITY Donegal Insurance Group Erie Insurance Group Farmers Mutual Fire Insurance Agents & Brokers Service Group Millers Mutual Group Penn National Insurance Plymouth Rock Assurance The Main Street America Group
BECOME A 2020 PARTNER TODAY Interested in becoming a partner? Please don’t hesitate to contact us.
Donegal Insurance Group now writes property and casualty business in 24 states.
Jess McWilliams Education Senior Director 800-998-9644, ext. 503 JessicaM@IABforME.com
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Q&A WITH
MARY PEPPELMAN
M
ary Peppelman is personal lines producer with Affordable Insurance Network, a full-service agency started by her father in 1995. Mary is active with Insurance Agents & Brokers (IA&B) and served on the 2019 Futures Program Input Group. Q. You joined the family business. What’s the best – and worst (if you’re willing to share!) – part of working with your dad? A. I’m super lucky to be able to work with my father. He is a wonderful role model, and I truly enjoy working alongside with him and learning more. He has taught me so much. So undoubtedly the best part is actually being with him. The worst part is that we don’t get to go on family vacations all together as much anymore! Q. Affordable Insurance Network recently signed up with Forge3 to develop a new website. What attracted you to the ActiveAgency website platform? And how is the process going? A. I first saw the ActiveAgency designs at an IA&B Delaware Convention and thought that Forge3’s ideas were completely different than anything else I
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had seen for insurance agency websites. While we’re still in the process of working on what we would like our site to look and feel like, the people at Forge3 have been awesome! They are really taking the time to make sure we get what we want. So far the design is completely different than our current site, and I’m confident it’s going to be great. Q. Our IA&B members in Delaware are a tight-knit group and maintain long-standing traditions (Delaware Convention, Crab Feast, Company Appreciation Night, etc.). For readers in Pennsylvania and Maryland, tell us about the Delaware insurance community and what makes it so special!
A. If you do your job right, there is a lot of opportunity for growth and to make a difference. There are chances around every corner to grow both financially and intellectually. Q. You’ve attended the IA&B Futures Conference for young agents the past two years. Why would you recommend the event to other young agents? A. The Futures Conference is awesome! I know that for many agents getting that time off can be difficult, but trust me, it is worth every penny and second away from the office. The sessions are always filled with invaluable information, from generating more business to help running your business better. To be honest, I think that all agency owners and even agents
A. We really do have a strong network. Throughout the year, we make it a point to get together – at IA&B meetings and beyond. Not only do we enjoy being around one another, but it’s good to have friends in the business that you can rely on and talk to, people who can relate to what’s going on in the industry. Q. As we – as an industry – focus on recruiting young talent, what attributes of an insurance agent career do you find most appealing and would make the best selling points? Mary with her father and fellow IA&B member, Sam Peppelman APRIL 2020
A. Oh my, yes. All of my dogs are rescues. The oldest one, Max, is a Dachshund who is about 15 years old. My second dog, Ebony, is a 3-years-old Chiweenie (a Chihuahua-Dachshund mix). I just
adopted my third dog, Lily, in January as an 11-week-old puppy. She is full of spunk and energy and is always chewing on everything – except her toys!
Mary on the golf course
who have been in the business for a long time would benefit from going, not just the younger generation. Q. Like so many insurance producers, you like to golf! What do you love about the game? A. I enjoy that you’re in complete control of your own game, yet you can still have a good time talking to your friends while getting in some exercise. Golf is one of those games that is mostly mental. You can be a great player, but if you’re mentally frustrated, it just messes up your whole game. You can play the same course a million times, and each time it can be completely different due to weather, or just how you are feeling. And I love that your game can turn around in a blink of an eye – it can be such a rush of excitement! Q. You graduated from college with a degree in theater arts. What prompted your interest in theater? A. As a kid, I always loved the arts, especially theater – musicals, plays, ballets, etc. It’s exciting to escape the everyday and watch something unfold in front of you. And in the theatre there is a lot of give and take of energy from the actors, the audience, and even those who work behind the scenes, which makes the shows come to life. Even the same show can be different each time you see it, depending on the energy.
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SELL 15-20% MORE WITH VIDEO PROPOSALS By Jeff Teschke
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APRIL 2020
I
nsurance can be a tricky thing to sell. You and I know that not all insurance is the same. There are numerous coverage options, policy types, and premiums to go with them. If you’re like most, you spend most of your day educating prospects and proposing your suggested insurance solution. But this is tough to do via email, and it’s not always possible to sit face-to-face with every prospect to walk through the options. This is where video proposals can change your world.
WHAT ARE VIDEO PROPOSALS? First, if you haven’t heard of them, an increasing number of producers like to send a short video along with their quotes and proposals. The average length is around five minutes. These video proposals can be used to explain coverage options or just put a friendly face in front of prospects. They typically show the producer on camera (webcam) and/ or a recording of the screen with the policy options or proposal shown as the producer talks through it. And yes, they work. “Close ratio is up about 15-20% since we began using them!” — Shaun / Agency Owner And if you think about it, it makes sense. There are a lot of nuances in any insurance proposal. Without taking the time to explain your recommendations, it’s easy for prospects to focus on the cost of the policy and lose sight of everything else, including the coverage.
SELLING MORE WITH VIDEO PROPOSALS The most obvious case for using video proposals is during the sales process. So, let’s take a closer look at that. People are increasingly expecting to do business virtually. Don’t take it personally. It’s not you. It’s all of us! If we can buy a car using an app, why can’t we learn about and buy insurance the same way? This is where video proposals come in. When you send your next proposal, think about how your prospect will see it. Are you typing a long, intimidating email that nobody will read? Are you attaching PDF brochures from your carrier that feel cold and lack a personal touch? Are you leaving inconvenient voicemails for your prospect to call you back? Instead, what if you could turn on your webcam, share your screen, and record a quick video to walk your prospect through your proposal? Think about the power of that.
WHERE TO GET VIDEO PROPOSALS Contain video proposals within your website thanks to ActiveAgency – the website platform provided by IA&Bpartner Forge3. ActiveAgency gives you a customdesigned agency website and includes effective lead generation sales tools, like Clickable Coverage, Hello Producer, Video Proposals, and more. Learn more by visiting forge3.com/ iab or contacting Zack Yurch. Zack Yurch 484-275-0983 zack.yurch@forge3.com
Not only does this immediately create a human connection with your prospect, but it also shows that you’re a different kind of agency. Simply put, people aren’t expecting to get a personalized video from you. It’s impressive. That alone is worth it.
OTHER USES FOR VIDEO PROPOSALS Of course, you can use these videos for things other than proposals. Think about the renewal process. Perhaps you set up a reminder a month or two prior to the renewal and send a quick video checking in. continued on page 20
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continued from page 19
Use it as an opportunity to ask account rounding questions, too. For example, if you provide their home insurance but not their auto insurance, or insure their business but not their personal assets, talk about it.
Regardless of how you do it, start thinking about it. You don’t need to use video proposals for every proposal, but I bet there are plenty of situations where they’d be perfect. Lights, camera, action!
WHERE TO GET VIDEO PROPOSALS Many IA&B agencies use ActiveAgency, a website platform that includes the agency website and a collection of sales, servicing, and marketing tools. The Video Proposals feature is included. Learn more and schedule a demo at forge3.com.
Jeff Teschke is Founder and CEO of Forge3, Ltd. As an IA&B partner vendor, their ActiveAgency website platform is the highest-rated, fastestgrowing solution in the industry. Learn more and schedule a demo at forge3.com.
Otherwise, there are freemium solutions like Loom (useloom. com). There are some limitations with the free plan. And unlike Video Proposals, which is built into ActiveAgency, your prospects will see the Loom branding. With ActiveAgency, they’d watch the videos right within your website, so it’s a more professional, polished look.
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All members welcome 63rd annual
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Thursday & Friday, May 7 - 8, 2020 Hyatt Place Dewey Beach CE classes Boardwalk Excursion & Lunch Golf Tournament at Peninsula Golf & Country Club Reception & Company Exhibit Booths Breakfast at The Starboard
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APRIL 2020
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APRIL 2020
THE SECRET TO E-SIGNATURE BLISS By Zafar Khan
I
t is easy to fall into a workplace routine. You know how to get something done, and your process works. Eventually you look to train others to use the shortcuts and process that you have found works, happy to hand off the tasks to another. Mission accomplished.
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E-SIGNATURES MADE EASY IA&B members receive a 10% discount on RSign® from RPost. Designed for simplicity, the RSign web-based process allows insurance agents and brokers to quickly and intuitively prepare and send documents to clients for electronic signature while always maintaining access and control. RSign allows: • Drag-and-drop document preparation • Web-based, guided signing • Access to one-click reusable templates
Too often, with technology tools, tips, and tricks, once the new modernized process has been institutionalized, no one looks back to improve or optimize — even as technology advances. With e-signatures, many are either stuck in processes that work but are tedious (call them old-fashioned printing, signing, scanning, or faxing processes) or that work better but are not optimal (configuring a form for electronic fill and e-sign uniquely each time something needs to be signed).
Keep reusing the Template Rule without any additional set-up work ... [to] eliminate repetitive tasks. Zafar Khan
• Tracking, reporting, and proof of delivery Learn more and schedule a demo. IABforME.com/RPost Questions? Claire Pantaloni, CIC, CISR Vice President – Advocacy 800-998-9644, ext. 604 ClaireP@IABforME.com Don Bankus Legal & Corporate Affairs Director 800-998-9644, ext. 603 DonB@IABforME.com
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The secret to pure workplace bliss is elusive for many. Here is a tech essentials tip for insurance professionals that should get you closer. In the e-signature world, there is a tool called Templates. What e-sign Templates let you do is configure a form or document for electronic signature by dragging and dropping fill-in fields, date fields, signature fields, checkboxes, etc. into proper places on your DOC or PDF form (using any browser and your mouse). You can then customize what the signer is supposed to see and do with that field (is it required, which signer needs to complete it, etc.) and customize other things like how many reminders to send, should it be sent encrypted, etc. Now, instead of saving your form with these fields and rules tagged and sending it for e-signoff, try saving it as a “Template,” name the template in a way that describes the form, and share the template for your team to use. Even better, create a sample cover letter and associate it with the template. Anytime anyone needs to get that form filled and e-signed, they don’t need to do anything other than enter the signer email addresses into an e-sign interface, select the template, and send for RSign-off.
APRIL 2020
And, you can do this all in any web browser without need for a fancy CRM, ERP, or other complicated sounding platform, with a service called RSign. Simple. Not quite bliss, but near bliss. You can take this a step further, by saving all the form-fill and e-sign rules you created as a Template Rule. With a Template Rule, you can upload any form that includes some fields filled in – a form that includes custom content, for example – and assign the Template Rule to the form. Presto, all the form field fill and sign rules automatically overlay onto your partially completed form. You and your team can keep reusing the Template Rule without any additional set-up work. This is bliss (at least workplace bliss if you are one that seeks ways to reduce repetitive workloads).
Join us for a great day!
Wednesday | May 6, 2020 Radisson Hotel & Convention Center
RSign “Templates” and “Template Rules” are very powerful, time-saving techniques that many do not know about. If you become an expert in this, you will make friends all over your workplace — at least with those who take pleasure in being able to eliminate repetitive tasks and finish their work efficiently. And best of all, you can start using all of this for just a few dollars a month if you choose RSign. RPost CEO Zafar Khan has been in the technology field for more than 15 years, and has strategy and finance experience with Deloitte Consulting and Goldman Sachs. He has also worked to transfer U.S. Department of Energy National Lab technology to the private industry and was selected as one of 15 CEOs to participate in a U.S. Presidential Trade Mission. Khan has invented four U.S. patents, holds a BA degree from Wesleyan University, an International Certificate from The Georgetown University School of Business, and an MBA degree from The Wharton School.
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Visit www.centralpaiday.com to register, exhibit, advertise, sponsor, or for more information.
Contact Bill Hunt at WAHVE today! Bill.Hunt@wahve.com • 646-807-4372 ext. 3757 *Mention your IA&B membership for a discount on set-up fees.
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800-998-9644, option 1 | IABforME.com/education CLASSROOM DATE TOPIC LOCATION 5 CPIA Position for Success Seminar* Mechanicsburg, PA 5-6 James K. Ruble Graduate Seminar King of Prussia, PA 6 CPIA Implement for Success Seminar* Mechanicsburg, PA 6 CISR Commercial Casualty II Exton, PA 7 CISR Commercial Casualty I Reading, PA 7 CPIA Sustain Success Seminar* Mechanicsburg, PA 12-14 Life & Health Licensing Study Course Mechanicsburg, PA 12-14 Property & Casualty Licensing Study Course Center Valley, PA 12-14 CIC Commercial Property Pikesville, MD 13 William T. Hold: Personal Lines Lancaster, PA 14 William T. Hold: Personal Lines Ellicott City, MD 18-20 CIC Insurance Company Operations Erie, PA 19 CISR Commercial Property Salisbury, MD 19 William T. Hold: Personal Lines Erie, PA 20 CISR Commercial Property Cranberry Twp., PA 20 CISR Personal Residential Indiana, PA 21 CISR Personal Residential State College, PA 21 William T. Hold: Personal Lines Pittsburgh, PA 27 CISR Life & Health Essentials Mechanicsburg, PA 28 CISR Agency Operations Wilkes-Barre, PA 28 CISR Personal Auto Hagerstown, MD *Attend all 3 seminars and earn the CPIA designation. LIVE WEBINARS DATE TOPIC TIME 7 Alphabet Soup - D&O, EPLI, FLI & EBL 1:00 – 4:00 PM 12 Ethics and E&O - Synergy Not Rivalry 1:00 – 4:00 PM 13 Cyber Coverage – Data Breach and So Much More! 9:00 AM – NOON 13 If It Moves on the Farm it Presents a Risk 1:00 – 4:00 PM 14 Dead or Alive – Many Function of Life Insurance 9:00 AM – NOON 19 Everything’s Soaked: Water Damage 1:00 – 4:00 PM 20 Welcome to the Future 1:00 – 4:00 PM 21 Insuring Modern Transit Risks 2:00 – 3:00 PM 26 Insuring Your Side Gig 2:00 – 3:00 PM 27 Commercial Property Claims that Stink 1:00 – 4:00 PM 28 Agents E&O: Documentation, Social Media & More 9:00 AM – NOON 28 Additional Insureds & Certificates 1:00 – 4:00 PM
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Professional agency since 1926 located in Feasterville, Bucks County, Pa. Call for confidential information and a review of our services. Contact Ray Reinard at 215-357-8600, Ext. 119. If you would like to place a classified advertisement, please contact Laura Gaenzle at Laura.gaenzle@theygsgroup.com or 717-430-2351.
PRIMARY AGENT EDITORIAL Editor: Karen Robison KarenR@IABforME.com 800-998-9644, ext. 606 Contributing editors: Jennifer Ross, Megan Fioretta, Melissa Telesha
SALES Account Executive: Laura Gaenzle laura.gaenzle@theYGSgroup.com 717-430-2351
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WHY SUCCESSFUL,
• 75% of independent agencies nationwide see the value of being in an agency network. • Scale is necessary, regardless of your size. • ANE is the 11th largest network in the country. • ANE is currently outperforming the industry. • We are owned by independent agencies who are invested in our success. • Our agency members are experiencing organic growth in double digits. • The contract is very simple, the fee is minimal, and the ability to leave is easy. • Agencies build their books, own it, and we don’t prevent them from keeping it if they leave. • Added resources, education, and intellectual capital are offered at no added charge. Visit www.ane-agents.com to learn more about ANE or call 800-700-9643.