Maryland Primary Agent - July 2016

JULY 2016 | MARYLAND

BRIGHT IDEAS TO COMBAT A DREARY PERPETUATION FORECAST

NEW CAREER CENTER PROFILING JOB APPLICANTS

Property Damage Liability FOR MULTI-FAMILY APARTMENT OWNERS/MANAGERS

OwnersPROTECT

A dynamic risk-transfer platform Zero cost to owner Significantly improves NOI

OwnersPROTECT is for property owners/managers with a total of 50 or more rental units. It transfers the financial costs and liability for resident-generated losses by five perils – fire, water overflow, smoke, explosion and residentinduced sewer backup – and fulfills residents’ legal obligations regarding indemnification within their lease agreement. The coverage provides $100,000 of property damage liability protection from residents, as well as their guests and visiting family members. The owner/manager is the named insured and the premium is simply added to the monthly rent.

Software provides delivery, monitoring and automated reporting process. The platform manages the entire process – either synchronizing data from existing property management software system or through the OwnersPROTECT online administration process.

For more information about Riverside or OwnersPROTECT, contact Mike Ebert at 717-480-7119 or mebert@RiversideBrokerage.com

OwnersPROTECT is brought to you by Riverside Brokerage Services & Powered by Renters Legal Liability® (RLL®). Riverside is a wholly-owned subsidiary of Millers Mutual Group, a regional property and casualty insurer serving independent insurance agents with commercial policyholders in Pennsylvania, Delaware, Maryland, Virginia, Washington, DC and Ohio.

IN THIS

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EYE ON TOMORROW Our new Career Center – which includes a job board, young agents’ program and career paths – aims to help agencies find, engage and retain fresh talent.

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PROFILING CANDIDATES FOR HIRING SUCCESS A poor hiring decision can have long-lasting – not to mention expensive – repercussions. That’s why it’s vital to rely on more than your gut when it comes to selecting a new employee.

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REMOTE WORKERS – THE OUTSIDE (AND INSIDE) SCOOP Expand your horizons … and your applicant pool and your office walls. There’s a great deal to gain from using remote workers.

IN EVERY ISSUE 2 3 4 6 8 9 IBC IBC IBC

Chairman of the Board’s Message Ask Our Experts Coverage Corner State News Platinum Profile IA&B Partners Advertiser’s Index My Events Classified Ads

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 # 2016-7, is published monthly by IA&B Service Group Inc., a subsidiary of IA&B.

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Copyright 2016. 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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CHAIRMAN OF THE BOARD’S MESSAGE

INSURANCE AGENTS & BROKERS

A BRIGHT FUTURE

5050 Ritter Road | Mechanicsburg, PA 17055 800-998-9644 | IABforME.com

OFFICERS

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Chair of the Board

Robert S. Klinger, LUTCF, CPIA

e’re all in the same boat. We want to supplement our tried and true staff with fresh talent – enthusiastic producers and CSRs who are ready to learn and embrace the industry as we did. But sometimes the applicant pool appears dry….

First and foremost, I am here to assure you that the future of our industry is not as doom-and-gloom as some may have you believe. In recent years, I have seen plenty of driven young agents (including in my own agency) who are hungry for success and willing to learn and grow and call “independent agent” their career.

At the same time, I recognize that the struggle to find these young agents is real. Our industry does not have the outward appeal it deserves, and the next generation can feel foreign to us. (But don’t think for a minute that our predecessors didn’t feel the same way about us!)

I’m proud to report that our industry is responding to the need for new talent and that IA&B is taking a leadership role in the efforts. Check out the article on page 10 to learn more about the association’s Career Center and how your agency can benefit from the job board, young agents’ program and career paths. Then do your part: Find a young producer to mentor. Volunteer to speak at a career day.

Encourage your young agents to spread the word. Together, we’ve got this. n

Vice Chair of the Board

Michael F. McGroarty Sr. Immediate Past Chair of the Board

Diana M. Hornung Hanby, ACSR

MEMBERS E. Stephen Burnett, CIC, ARM Wilmington, Del.

Richard F. Corroon, CPCU Wilmington, Del.

N. Lee Dotson, CIC, AAI Wilmington, Del.

Michael P. Ertel+ Columbia, Md.

Bryan C. Hanes, JD Hagerstown, Md.

John B. Hollister Milford, Pa.

Jocelyn R. Howard-Sinopoli, CIC, CISR Butler, Pa.

David C. King Lancaster, Pa.

Douglas A. Loesel, CPCU Erie, Pa.

Crag S. Mader

Gambrills, Md.

Ann Gallen Moll, CIC Reading, Pa.

Mark J. Monroe

Best,

West Chester, Pa.

Joseph R. Pastor, CPCU, AAI Oil City, Pa.

Richard M. Rankin, CIC Lancaster, Pa.

Robert S. Klinger, LUTCF, CPIA Chairman of the Board

April E. Ressler, CIC Altoona, Pa.

Scott C. Rogers, CPIA* York, Pa.

Glenn R. Strachan

Ft. Washington, Md.

Lawrence A. Wilson, CIC, CPIA, CPCU, ARM** New Castle, Del.

J. Marshall Wolff, CIC, CPCU Easton, Pa.

* Pa. IIABA National Director ** Del. IIABA National Director + Md. PIA National Director

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Ask Our Experts This month’s answer was provided by Claire Pantaloni, CIC, CISR, our industry affairs director.

Question: When a customer wants to reduce or delete coverage, we normally process it only after receiving a written, signed and dated request. Our new phone system allows us to receive emails with audio file attachments, which we can attach to the client file. Is the voice instruction sufficient to attach to the customer file?

Answer:

U

pon doing some research and bouncing this request off one of our E&O programs, here is our perspective: As long as the availability, quality and “legibility” of the file are maintained throughout the life of the policy, the audio file should be a viable substitute for the signed acknowledgment, particularly in the circumstances you describe.

Legibility implies that any software upgrades should not prevent the ability to “read” prior versions.

The agency would need to retain the audio file until the insured’s file is discarded. The agency will need to address whether this could create any storage issues. The convenience or feasibility may depend on how customer files are retained in the agency. For example, if the agency currently identifies the types of documents to retain in the

system from year to year from the ones you keep longer, it would be essential to identify the audio file or email properly so that it is retained. If you keep everything for the life of the policy, this issue would be moot.

3 suggests the customer read the amended policy in detail and contact the agency if anything is not consistent with his request, if he changed his mind or has questions.

In all circumstances, you may want to identify/name these audio files clearly so that you know what they contain, are easy to retrieve, and as mentioned above, are not discarded too early.

This could be an additional piece of evidence if the customer challenges the change down the road. n

Another option which can complement the filing of the audio file is to provide a confirmation letter (upon receipt of the request or when sending the amended policy). For example, you could attach a letter with the endorsement delivery that: 3 confirms the customer’s request to delete, reduce or modify coverage, and

Have a question?

Ask our experts!

Rely on our experts to answer your most perplexing questions. Visit the Ask Our Experts section of IABforME. com (find the link in the website footer) to submit your question and review answers to other frequently asked questions. Or email your question to us at IAB@IABforME.com.

We look forward to hearing from you.

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COVERAGE CORNER

DATA BREACH NEGLIGENCE CLAIMS NOT RECOGNIZED IN PENNSYLVANIA

By Jerry M. Milton, CIC

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he Court of Common Pleas in Pennsylvania has refused to recognize negligence claims in data breach lawsuits, making it more difficult for plaintiffs to pursue claims and damages in data breach cases. This decision adds to a growing body of case law that have held negligence claims for failure to provide reasonable data security protections are not actionable.

In his decision, Judge Wettick of the Court of Common Pleas of Allegheny County refused to create a common law duty to protect and secure confidential

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information. The decision was issued in the case of Dittman v. UPMC, which was filed on behalf of over 62,000 plaintiffs.

Although not binding state-wide, Judge Wettick’s decision represents an important step in the development of privacy law in Pennsylvania.

The complaint was filed against the University of Pittsburgh Medical Center (UPMC) after names, birthdates, social security numbers, confidential tax information, addresses, salaries, and bank account information of current and former employees were stolen from

JULY 2016

UPMC’s computer systems. The plaintiffs argued that UPMC had a common law “duty to protect the private, highly sensitive, confidential and personal information, and the tax documents of plaintiffs and the members of the proposed class.” The complaint claimed that UPMC violated this duty when it failed to “exercise reasonable care to protect and secure the information.”

The plaintiffs argued that UPMC’s duties included an obligation to design, maintain and test “its security systems to ensure that the members of the proposed

classes’ personal and financial information was adequately secured and protected.”

It was further argued that “UPMC had a duty to implement processes that would detect a breach of its security systems in a timely manner.” Lastly, the plaintiffs argued that UPMC should be liable for its failure to meet industry standards for a risk that was reasonably foreseeable.

activity of third persons, and there is no safe harbor for entities storing confidential information.” He further noted that the imposition of a new duty was unnecessary because entities that store confidential information already have a strong incentive to protect the data and avoid disastrous operational consequences resulting from a breach.

Judge Wettick’s decision is important not only for his finding no common law cause of action for data breaches, but also for the reasons he relied upon to support his conclusion. Judge Wettick found:

Addressing the public policy issue, Judge Wettick adopted a very practical approach. He determined that the creation of a new duty would expose Pennsylvania courts to the “filing each year of possibly hundreds of thousands of lawsuits by persons whose confidential information may be in the hands of third persons,” a burden the courts are not equipped to handle. He further recognized that there is an absence of guidance as to what actions constitute reasonable care, and allowing juries to determine this issue is not a “viable method for resolving the difficult issue of the minimum requirements of care that should be imposed in data breach litigation.” Lastly, he took notice of the fact that creation of a new cause of action would require companies to expend substantial resources defending lawsuits even though those entities “were victims of the same criminal activity as the plaintiffs.”

(1) Pennsylvania’s economic loss doctrine precludes a negligence cause of action for economic loss stemming from a data breach; (2) Public policy considerations mitigated the creation of an affirmative duty of care in connection with data breach cases; and (3) The Pennsylvania General Assembly’s prior actions evidenced an intent not to impose such a duty.

With regard to the economic loss doctrine, Judge Wettick noted that the UPMC employees sustained only economic losses resulting from the improper actions of one or more third parties. He turned to the economic loss doctrine and affirmed that “no cause of action exists for negligence that results solely in economic loss unaccompanied by physical injury or property damage.”

Recognizing the magnitude of the problem, Judge Wettick noted that “data breaches are widespread and frequently occur because of sophisticated criminal

direction of the General Assembly because public policy is a matter for the Legislature.”

While Judge Wettick’s decision will probably not be the final word on liability stemming from data breach cases in Pennsylvania, it is likely to be followed by other Pennsylvania courts. This case (Dittman v. UPMC) has been appealed to the Pennsylvania Superior Court and, at the time this writing, was on the court’s April 2016 calendar.

Y’all take care! n

Jerry M. Milton, CIC, teaches and consults on industry issues. The legal profession recognizes him as an expert on insurance coverages. He also serves as our education consultant, working with our CISR, CIC and continuing education programs. Catch him at one of our upcoming seminars: IABforME.com/MyTraining.

Judge Wettick also noted that the Pennsylvania General Assembly extensively considered the issues involving data breaches when enacting the Breach of Personal Information Notification Act which was effective June 20, 2006. The Act did not establish a duty of care or a private cause of action. It only created a notification obligation in the event of a data breach. Judge Wettick concluded: “It is not for the courts to alter the

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STATE NEWS

FLOATING FLOOD UPDATES TO MARYLAND AGENTS Trying to keep up with changes to the National Flood Insurance Program (NFIP) can feel like swimming against a raging current. Our IA&B flood expert, Rita Hollada, CIC, CPCU, CPIA, will be in Maryland later this month and again in September, for a full-day update (approved for 8 FLD continuing education credits).

Consider “Understanding Flood Insurance – Updated for 2016” a life line to agents who need help advising property owners of their flood risk and insurance options … which also will help agents mitigate their E&O risk.

MEMBER AGENTS LOBBY FEDERAL LAWMAKERS IA&B of Maryland Board of Directors and Government Relations Committee members were in Washington, D.C. this spring to speak directly to federal lawmakers about the most important national issues impacting the insurance industry, agents and their clients.

They met with both congressmen and congressional staff in the offices of Reps. Dutch Ruppersberger, Chris Van Hollen, Andy Harris, John Delaney, John Sarbanes, and Sen. Ben Cardin on issues including: • Support for a reformed and modernized National Flood Insurance Program • Healthcare issues, including repealing the harmful “Cadillac tax” and removing agent compensation from the Medical Loss Ratio formula • Protection of our state-based system of insurance regulation from federal encroachment • Preservation of the Federal Crop Insurance Program These meetings are part of our broader efforts to help members forge relationships not only with state legislators but also with the federal lawmakers whose decisions in Washington, D.C. directly impact the insurance industry and small business community on a daily basis.

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JULY 2016

Rita will discuss NFIP changes, to include surcharges, premium jumps and fee increases, as well as the newest high-deductible options. These and other reforms stem from the remnants of the Biggert-Waters Flood Insurance Reform Act of 2012 and the follow-up law it triggered, the Homeowners Flood Insurance Affordability Act of 2014.

Even for agents not selling flood insurance, this update is important to better understand what effect recent changes have on personal lines clients.

The 8-credit seminar is coming to these locations: • Salisbury, Md. – July 26 • Baltimore, Md. – Sept. 15 IABforME.com/flood2016

REDMER RISES AMONG STATE INSURANCE REGULATORS Maryland is well positioned within the National Association of Insurance Commissioners (NAIC).

Representatives of the group’s 12-state northeast zone recently elected Maryland Insurance Commissioner Al Redmer Jr. as its regional chairman – a position that puts Redmer on the NAIC Executive Committee.

The NAIC currently has several hot topics on its plate, including a contentious Cybersecurity Bill of Rights. We joined other industry stakeholders in raising concerns about the document’s potential to cause consumer confusion.

As the NAIC considers this and other issues that could impact the independent agency community, we hope to leverage our positive working relationship with the Maryland Insurance Administration – and Redmer in particular – to assert the producer’s perspective.

CHESAPEAKE TO BEGIN NCCI AFFILIATION Chesapeake Employers’ Insurance Company recently shared its plans for complying with 2015 legislation that mandates its full affiliation with the National Council on Compensation Insurance (NCCI). Between 2020 and 2023, Chesapeake will join the NCCI and adopt its rates and experience mods.

As a refresher, the Maryland Insurance Administration (MIA) spurred these changes with its fall 2013 recommendations for Chesapeake (formerly the state-run Injured Workers’ Insurance Fund). The MIA argued that the changes would offer more uniformity in ratemaking and a level playing field.

The Maryland General Assembly began debating the transition in 2014 before enacting legislation last year.

Additional changes (both set for 2022) for Chesapeake include: • Requirement to pay federal taxes • Allowance to write workers’ compensation in other states

AMENDED SURPLUS LINES CONSUMER DISCLOSURE IN EFFECT Make sure that you (and/or your surplus lines broker) use the most recent disclosure form to remain compliant with state regulation. Effective Wednesday, May 18, the state’s surplus lines consumer disclosure includes new language.

The Maryland Insurance Administration amended Regulation .09B of COMAR 31.03.06 to advise consumers that surplus lines insurance products are not covered by the Maryland Life and Health Insurance Guaranty Corporation.

Following full implementation of the legislation, the private, nonprofit Chesapeake will perform like other mono-line insurers with only two exceptions: The company will continue to be the state’s guaranteed workers’ compensation market writer, and the governor will appoint two of its nine board members.

NEW P&C LICENSING EXAM SELF-STUDY GUIDE NOW AVAILABLE IA&B this spring released the Maryland Property & Casualty Pre-Licensing Self-Study Guide, a tool aspiring agents can use to significantly improve their chances of passing the Maryland P&C licensing exam on their first try.

“We tailored the guide specifically to the Maryland exam but mirrored it to our successful pre-licensing program for Pennsylvania agents,” said Rick Russell, president and CEO of IA&B. Russell added that our self-study guide has been approved by the Maryland Insurance Administration for meeting all pre-licensing education requirements.

The new guide provides would-be agents with test-taking tips, insight into questions they should be prepared to answer, a study schedule and details about the entire process. It also includes a corresponding mentor program that’s unlike any pre-licensing program available to Maryland agencies.

MENTOR GUIDE INCLUDED “Time and again, we’ve seen how a mentor can make all the difference for someone preparing for a licensing exam,” said Russell. “Our guide provides a seasoned producer with strategies, schedules and sample questions to help a coworker prepare for the test.”

The Maryland Property & Casualty Pre-Licensing Self-Study Guide includes the licensing text, study guide, mentor guide, chapter quizzes, exam simulator online access, and state-specific law information. It is available for $169 for IA&B members ($189 for non-members).

A money-back guarantee is offered to assure satisfaction.

IABforME.com/surplus_lines IABforME.com/MDlicensing

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PLATINUM PROFILE

Insurance Agents & Brokers proudly recognizes Mutual Benefit Group as one of its Platinum Partners. IA&B Platinum Partners dedicate the highest level of sponsorship to our organization.

Mutual Benefit was pleased to welcome three new members to its field operations/marketing staff during the past year. They are, standing, left to right, Marianne Morosko, vice president, field operations; Kelly Pulliam, senior marketing representative; and Heather Crayosky, marketing coordinator. They join Todd Heisey and Larry Kiser, seated left to right, who have been senior marketing representatives with the Company for approximately 20 years.

MUTUAL BENEFIT GROUP “We want you here for our sales conference.

Bring your problems. There are ideas in your mind which can be developed, and NOW is the time for us to work together!”

These lines from an invitation sent to agents in 1932 by Mutual Benefit’s leadership demonstrate one of the most significant legacies of Mutual Benefit’s 108-year history – building strong relationships with independent agency partners.

Today, Mutual Benefit remains focused on listening to its agency partners and forging strong relationships that benefit agent, policyholder, and carrier alike. Mutual Benefit is dedicated to providing a stable market for both personal and commercial lines business; accessible, knowledgeable underwriters; exceptional claims service that in 2015 garnered a 96% approval rating from policyholders; easy-to-use rating and billing systems; fair prices; and a full range of high quality coverage. And agents recognize that commitment, as evidenced by the perfect score they awarded to MBG in the category of “commitment to the independent agency system” on the 2015 IA&B Company Satisfaction Index survey.

“We want our agents to see Mutual Benefit as a key partner who is committed to helping them grow their agencies,”

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says Marianne Morosko, who was named MBG’s new vice president of field operations in July 2015. Marianne is not the only one who is relatively new to MBG’s Marketing Department.

Heather Crayosky took on the role of marketing coordinator last spring. Kelly Pulliam came on board in September 2015 as senior marketing representative in Maryland, joining fellow senior marketing representatives Larry Kiser and Todd Heisey, who serve western and eastern Pennsylvania, respectively.

“With the change in staff comes new training and networking events, incentives and rewards, and a few outings just for fun,” says Marianne. “What won’t change is MBG’s commitment to supporting the needs and fostering the growth of independent agencies.”

Just like Mutual Benefit’s early leaders, who got their start as agents, Marianne, Larry, Todd, Kelly, and Heather have all worked in agencies or underwriting…or both. Just like MBG’s early leaders, all are ready “to listen to agents’ problems and help develop the ideas in agents’ minds.”

And, all would agree that “NOW is the time to work together.” n

JULY 2016

FOCUSED ON RESULTS FEATURED PARTNER

Mutual Benefit Group (MBG) CHIEF EXECUTIVE OFFICER

Steven C. Sliver, President and CEO HOME OFFICE LOCATION

Huntingdon, Pennsylvania A.M. BEST RATING

A- (Excellent) WEBSITE

www.mutualbenefitgroup.com

PARTNERS PROGRAM

Listed below are those companies that strongly support the independent agency system and Insurance Agents & Brokers.

Thank you for your continued sponsorship.

WHAT IS IA&B PARTNERS? The IA&B Partners program gives company and allied businesses the opportunity to demonstrate their commitment of support to independent agents and receive maximum market exposure. As an IA&B Partner, you will also realize the benefits of IA&B membership to help you succeed in the insurance industry.

DO YOU SEE YOUR NAME? To become an IA&B Partner, choose the sponsorship package that matches your commitment of support.

Contact the Member Sales Center at 800-998-9644, 717-795-9100 or visit us online at IABforME.com to get started.

PLATINUM LEVEL

BRONZE LEVEL

ACUITY

Aegis Security Insurance Co

Amerisafe

Agency Insurance Company

Berkley Mid-Atlantic Group

AmWINS Program Underwriters Inc

Donegal Insurance Group

ARI Insurance Companies

Erie Insurance Group

Auto-Owners Insurance Company

Harleysville Insurance

Bailey Special Risks Inc

Insurance Agents & Brokers Service Group Inc

Brethren Mutual Insurance Company

Liberty Mutual Insurance

Conemaugh Valley Mutual Insurance Co

MAPFRE Insurance

Countryway Insurance Company

MMG Insurance Company

Encompass Insurance

Millers Mutual Group

Foremost Insurance Group

Mutual Benefit Group

GMI Insurance

Penn National Insurance

Goodville Mutual Casualty Company

Swiss Re

Grinnell Mutual Reins Company

The Main Street America Group

Guard Insurance Group

United Fire Group

HM Workers’ Compensation

Utica National Insurance Group

Insurance Alliance of Central PA Inc

Briar Creek Mutual Insurance Company

Insurance House GOLD LEVEL

Insurance Placement Facility of PA

Progressive

Lackawanna Insurance Group

Westfield Insurance

Lebanon Valley Insurance Company Merchants Insurance Group

SILVER LEVEL

Access Insurance Company American Mining Insurance Co Cumberland Insurance Group Farmers Mutual Insurance Company of Western Pennsylvania

Mercury Casualty Millville Mutual Insurance Co PennPRIME Municipal Insurance Reamstown Mutual Insurance Company Rockwood Casualty Insurance State Auto Mutual Insurance Company

Frederick Mutual Insurance Co

TAPCO Underwriters Inc

Juniata Mutual Insurance Co

The Motorists Insurance Group

Keystone Insurers Group Inc

The Mutual Service Office Inc

PSBA Insurance Trust

Travelers

Selective

Tuscarora Wayne Group of Companies

The Philadelphia Contributionship

Zenith Insurance

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JULY 2016

EYE O N TOMORROW

THREE WAYS TO STAFF YOUR AGENCY FOR SUCCESS Finding, engaging and retaining young talent is the great equalizer among independent agencies, small and large, rural and urban. Our new Career Center – which includes a job board, young agents’ program and career paths – aims to help.

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O

ur industry’s talent crisis has been written, talked, fretted and complained about for years. We’re ready to take action to support agencies’ search for young talent – and to help engage existing young agents.

THE ASK Among our member agency owners, the ask is common (and – with the average age of an insurance agent reaching 59 – the ask is increasingly urgent): Where can I find new talent?

While our industry offers much of what today’s younger workers want – leadership opportunities, competitive salaries, good benefits, flexible work schedules – we face an uphill battle.

According to The Hartford’s 2015 Millennial Leadership Survey, insurance is one of the industries with the lowest appeal … piquing the interest of just 4 percent of young people surveyed.

The ask is common and increasingly urgent: Where can I find young talent?

We aren’t Pollyannas. We won’t pretend that there is a magic wand to reset a generation’s mindset. We recognize that there is a great deal of work ahead of us to chip away at slowly learned and long-held misconceptions and to rebuild trust and interest.

But we’re prepared to join the rest of the independent agency community and to take on the challenge one step at a time.

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JULY 2016

Expect big things in workers’ compensation. Expect to save a third of your clients 30% or more. Most classes approved, nationwide.

For information call (877) 234-4450 or visit auw.com/us.

Š2016 Applied Underwriters, Inc., a Berkshire Hathaway company. Rated A+ (Superior) by A.M. Best.

Insurance plans protected U.S. Patent No. 7,908,157.

OUR RESPONSE We listened to member agency owners discuss their overriding concerns and struggles. Then we asked questions and listened some more. In the end, we zeroed in on two key, and surprisingly common, needs – finding new talent … and then retaining it.

Our three-prong approach to address the talent crisis dovetails off of these needs. We developed a venue for recruiting new talent, an initiative to engage young agents, and a plan to integrate new hires into your agency and into the industry as a whole. The effort is tied together broadly in our new Career Center, found at IABforME.com/CareerCenter. On the following pages, we highlight what it offers.

Job board A recent MarshBerry study suggests that to balance the impending retirement of mature producers, agencies will need to hire three young producers for every current agent on staff.

Of course, these young producers are much easier discussed in theory than actually found and hired. But our new job board aims to help.

The IA&B job board offers a place for job seekers and employing agencies to unite.

Individuals can post their resumes anonymously, peruse relevant job listings and create job alerts. Jobs are sorted by function – account management, accounting/bookkeeping, benefit services, claims, clerical/receptionist, marketing, management, producer/sales agent, and sales management – and by industry, such as administrative/clerical, bonds/surety insurance, health/benefits, life insurance, loss control services, P&C insurance, and retirement planning. There is no cost for job seekers to use the board.

Hiring agencies have two ways to use the board: 1) to review the resume bank and 2) to post their job openings. Each employer can create an account to store resumes of potential candidates, as well as template information about the agency, to streamline the hiring process. Pricing to access the contact information associated with a resume and to post a job opening are available on our website (with discounts for IA&B member agencies).

The site allows job seekers to search by function, industry and state.

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We recognize that a build-it-and-they-will-come attitude won’t sustain a job board, so we will undertake an outreach campaign in the months ahead to help populate the resume bank and increase traffic to the posted jobs. We will contact area business schools, colleges and universities to encourage graduating students to utilize the job board and, in turn, see the opportunities our industry has to offer.

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Futures Program Employees are voluntarily leaving their jobs in the highest numbers since the recession.

Couple this with Millennials’ tendency to job hop, and efforts to retain those hard-earned new hires is more important than ever. That’s a driver behind our new initiative to engage young agents and help them to connect, collaborate and network with one another.

Early last year we began our research, comparing notes with other agents’ associations and holding focus groups (some informally, during happy hour) with member agents in the Millennial age bracket. The outcome was the launch of our Futures Program and its overarching mission to develop today’s young agents into tomorrow’s leaders.

INAUGURAL FUTURES CONFERENCE Sales Strategies for Young Agents YOUNG AGENTS: Join us Sept. 15-16 at the Chubb Conference Center in suburban Philadelphia for our Inaugural Futures Conference. With an agenda defined by young agents and presented by relatable thought leaders in in sales strategies for all generations, this all-inclusive conference is designed to tap the potential of the next generation of producers.

IABforME.com/FuturesConference

The program began with a Facebook group, where young agents exchanged ideas on intergenerational workplaces, industry technology, recommended reading, industry competition and – yes – a few cartoons and memes. From there, Futures Program participants moved from the Internet to “the real world,” joining us at federal lobbying events and representing us at charity fundraisers.

Next up for the group is the inaugural Futures Program Conference, slated for Sept. 15-16 outside of Philadelphia. Based on young agents’ input, it will focus on the intergenerational dynamics of selling, how to leverage social media for sales, and networking. (See sidebar on right for more information.)

Career paths Supporting employees with the appropriate knowledge – on everything from office procedures to industry complexities – is another key factor in retaining employees.

In fact, the need for mentorship and overall direction was one of the big asks from the

Partners.

You and your clients. You and Harford Mutual. We’re committed to protecting their business and building yours.

That’s what mutual success is all about.

Explore P&C insurance opportunities at www.HarfordMutual.com 410.838.4000 / 800.638.3669

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The sales/producer path helps agencies guide new producers through an orientation, initial licensing, proper procedures and a review of agency standards and products. And it supports their efforts to obtain more in-depth knowledge of coverages, sales skills, marketing strategy and more.

The customer service path helps agencies orient CSRs with office protocols, licensing requirements and the basics of various lines of coverage. It supports their knowledge of service skills, agency procedures and policy specifics.

The management path focuses on managers’ need to maintain a high-level vision for the agency, strategic awareness of its markets and varying degrees of operational knowledge. The path helps to develop business management skills, coverage knowledge, and compliance and legal awareness.

WHAT’S AHEAD Help finding, engaging and retaining new talent is a top ask among our member agency owners, and it’s a charge we take seriously. We’re committed to striking up interest in the industry and helping fresh new talent thrive in our member agencies.

As we continue to enhance our Career Center, we encourage you to follow along. n

Each career and training path comes with a checklist of relevant resources available at IABforME.com and an individual checklist to monitor progress.

Access the new Career Center — which includes a job board, young agents’ program and career paths — at IABforME.com/CareerCenter.

young agents we spoke with. Hence the third component of our Career Center: career and training paths for new employees, as well as those taking a new position within the agency.

The paths cover three segments – sales, service and management – each of which comes with a checklist of relevant resources available at IABforME.com and an individual checklist that can be used to monitor progress. Each path also links to on-demand training in core competencies.

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JULY 2016

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PROFILING CANDIDATES FO R H I R I N G S U C C E S S

A poor hiring decision can have long-lasting – not to mention expensive – repercussions. That’s why it’s vital to rely on more than your gut when it comes to selecting a new employee. Read on for a synopsis of behavioral assessments: how they work and how your agency can benefit.

I

t’s common knowledge that a poor hiring decision can be an expensive mistake. In fact, HR professionals are prone to say that an ill-fitting employee can cost an employer one and a half times the employee’s salary. But if that employee is in a revenueproducing position – such as an insurance producer – that number could reach (are you sitting down?) two to three times the employee’s salary.

Kim Busse dropped that nugget early in “Assessing Applicants: Can You Profile for Performance?”, the recent IA&B Power Hour webinar she presented. And with it, she solidified the case for using every tool available – including profiling through behavioral assessments – when considering job candidates.

WHAT IS “PROFILING”?

Profiling goes beyond what the candidate says. After all, every candidate should be well prepared for an interview, explained Busse, key relationship manager with The Omnia Group. It’s expected that they should do their due diligence: researching the employer and preparing responses to typical interview questions. But profiling digs deeper. It allows an employer to uncover a candidate’s natural behaviors, not just his or her level of preparation.

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EMPLOYMENT ASSESSMENT AT A DISCOUNT WHETHER DEALING with new hires, internal promotions, teambuilding or even agency perpetuation, profiling services can help you make smart, objective and economical personnel decisions. Through your IA&B membership, you have special access to two leading behavioral-assessment companies: Omnia and HireStrength.

Mention that you are a member of the National Association of Professional Insurance Agents (our national affiliate) for a free profile from Omnia. Or advise HireStrength that you are an Insurance Agents & Brokers member for a discount.

IABforME.com/profiling

HEAR MORE FROM BUSSE A RECORDING of Busse’s complete “Assessing Applicants: Can You Profile for Performance?” webinar, as well as her PowerPoint slides and links to complementary IA&B resources, are available in the Power Hour resource library.

IABforME.com/Power_Hour

“You need to find someone who is great for the culture and the position,” said Busse. Behavioral assessments support that aim.

HOW DOES PROFILING FIT INTO THE BIG PICTURE? Busse recommended a holistic approach to hiring, one that includes profiling but does not exclusively rely on it – nor on any other factor. Her best practices approach looked like this: • References – 5% • Education/work experience – 25% • Social media – 10% • Background/drug test – 5% • Behavioral profiling – 25% • Interview impression – 30% She noted that references do not carry the weight that they used to, as many past employers only will verify employment dates, but that social media now can be used to offset that change.

While she cautioned that employers cannot use social media as a deciding factor, reviewing a candidate’s public profiles is fair game – and often very insightful.

For education/work experience, Busse referred to the skills and potential found on the resume and application. Then she shared that profiling through a behavioral assessment will uncover natural behavioral traits, such as a producer’s resilience or a CSR’s attention to detail. Finally, she recommended that employers round out their selection process with their overall interview impression – loosely defined as their gut instinct but inclusive of everything they witnessed, down to how the candidate treated the receptionist.

HOW CAN AN EMPLOYER USE PROFILING? Some employers use behavioral assessments before the initial interview, while others wait until between the first and second interview. Either way, the results will be available for the employer to ask follow-up questions during a subsequent interview. Busse shared that, as long as profiling is used consistently, there is no wrong time to conduct it. (However, she did recommend that at a minimum employers screen candidates by phone before conducting a behavioral assessment.)

Profiling can be a powerful tool in an employer’s HR toolbox.

And the benefits go beyond avoiding hiring mistakes. The

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JULY 2016

results identify how to play to an employee’s strengths, pinpoint motivators for coaching, and mitigate behavioral differences between a manager and employer. Busse also touted the benefits of behavioral testing when pairing a new hire with a mentor for orientation, considering an existing employee for a promotion, and succession planning.

There’s no way around it: Hiring and managing employees are complex. But profiling with a behavioral assessment can make the processes smoother, smarter and more effective. n

Learn more about profiling by reviewing the complete recording of Busse’s Power Hour webinar (IABforME.com/Power_Hour) or by accessing our member resources at IABforME.com/profiling.

You need to find someone who is great for the culture and the position.

A behavioral assessment will uncover natural behavioral traits, such as a producer’s resilience or a CSR’s attention to detail.

HR Pitfal ls

is a two on-dema -hour n to help p d course common rincipals ID HR man missteps agement an complia d nce concern s.

PRESENTERS

Jason Ernest, Esq. IA&B Deputy CEO and Counsel

Claire Pantaloni, CIC, CISR IA&B Industry Affairs Director

IABforME.com/HRpitfalls

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H.R. HEADQUARTERS

R E M OT E WORKERS –THE OUTSIDE (AND INSIDE)

SCOOP

By Karen H. DiGioia

Expand your horizons … and your applicant pool and your office walls. There’s a great deal to gain from using remote workers. On the following pages, our HR consultant – and remote worker herself – outlines the benefits, considerations and best practices.

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JULY 2016

T

o begin, I’d like to ask you to close your eyes (humor me for just a moment). Oh, wait – that won’t work. If you close your eyes, you won’t be able to read the article. Open your eyes, but prepare to do some visualization.

Visualize a woman, sitting in a room in her home (or outside on her patio – sitting in the warm sun), she is wearing workout clothes (OK – sweats), feet up on a desk, a pad of paper on her lap. She’s deep in thought and scribbling frantically in that notebook. It’s 6:35 a.m., and this woman is hard at work.

That picture in your mind is me – writing this article – and it may or may not fit your vision of a person who is “hard at work,” but believe me: It is, and I am.

My point (and yes, I do have one) is that this article comes to you from a person who is: 1) a seasoned HR professional who can speak about the “technical” considerations of managing remote workers and 2) a seasoned remote worker with over 20 years of experience at working from home. Hence you are getting the outside – and inside – scoop!

Remote work is not a trend or a passing fad. It is firmly established as a way to work and continues to expand. I have a word count limit (which I consistently exceed), so I won’t take the time here to go into the statistics. Instead, let’s focus on how you, as an employer or manager, determine if remote work is an option and some of the important considerations.

The first question that I would like to address is “why.” Why should you consider allowing employees to work remotely?

First of all, remote employees can save you money. Remote workers do not require office space and therefore can cut back significantly on the square footage your company requires to operate. This can translate into significant savings.

Secondly, by hiring remote workers, you greatly expand your applicant pool. Your employees don’t necessarily have to be within a reasonable commute in order to consider and accept the job.

Finally, remote workers have been shown to have higher levels of productivity, employee satisfaction and increased loyalty.

The bottom line? There’s a lot to love about remote workers.

The next question is “who” or possibly “how.” Who should be considered for remote work, or how do you decide if a remote arrangement will work?

Let’s talk first about “how” because your best bet is to begin by looking at the job. Look at the responsibilities – can they be accomplished from a remote location without a negative impact

on the work that is done? Generally, positions that aren’t suited for remote work are ones that require face-time with customers. Some positions, obviously, wouldn’t work – delivery people, food service workers, retail workers, some sales people, professional athletes and performers – all need to be face-to-face with the customer. A large number of jobs, however, are excellent candidates for remote work arrangements. If the responsibilities of the job can be done remotely and an employee is interested (or the company has a need), it’s worthy of consideration.

Also, look at your technology. Make certain that you can put the appropriate tools in place to enable the work to be done remotely.

Remote workers need access to everything they would access if they were in the office – access to your server, access to email, online meeting tools, cell phones, file-sharing services, etc. All are commonplace tools necessary for most remote work arrangements.

WAHVE OF THE FUTURE AS KAREN writes, by hiring remote workers you greatly expand your applicant pool.

Work At Home Vintage Experts (WAHVE) simplifies the process of employing remote workers. Here’s how: The right fit. WAHVE staff are experienced, skilled insurance professionals who are retired from the industry but choose to continue working from home (“pretirees”). WAHVE checks their references and backgrounds and then personally assigns them to your agency based on their work history and your agency’s specific needs.

The details ironed out. The contracted workers use secure, remote-access technology set up by WAHVE. Whether it’s full customer service work or process work in support of CSRs, account managers and producers, WAHVE staff have the appropriate equipment (including standard dual monitors).

Learn more – including about the IA&B member discount on the one-time set-up fee.

IABforME.com/WAHVE

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What about the “who” question? Are all employees suited for remote work? Let’s put the “who” off just a little bit longer and talk about how you manage remote workers. After that, I promise, we’ll talk about the “who.”

So, how do you manage remote workers? Quite honestly, it shouldn’t look very different than the way that you manage all of your employees. The bottom line expectation for your employees is that they get their work done and they get it done well. Sometimes managers rely on the fact that they can “see an employee working” in order to judge the job that is being done.

But isn’t it the results that matter more? I’m sure each and every one of you can think of an employee who was great at being there – always at their desk seat – in early, out late – but who got absolutely nothing (or nothing of value) accomplished in that time. We know that it takes more than “presence” to do a good job – so let’s manage that way. If we manage for results rather than presence, a remote worker who is not “present” will be managed just like everyone else. Let’s talk a little bit about what that looks like.

The first step for remote (and all other) employees is defining and communicating expectations. After that, you assign work and measure the results.

When defining and communicating expectations, make sure to cover the job-specific information but also your expectation around “how” work gets gone. What are the expectations around work schedule? Many remote employees work outside the traditional 9 – 5 work day. Is this OK or not? When do you expect the employee to be “available” and how? Maybe it’s OK for them to get the work done whenever it suits them but you also need them to be “available” to take a call from you or coworkers during certain core hours. Make this expectation clear.

With smart phones, it’s really not difficult to achieve.

Set up times to check in with your remote worker – just like you do with your on-site employees. With remote employees this can be done on the phone, via Skype or in person.

Communicate your expectations regarding when you expect your remote worker to come into the office. Some remote workers are expected to attend weekly meetings in person. Others come in once every few months. Still others, once a year. There’s no right answer but it’s also important to ensure that your remote employees aren’t “disconnected” from their co-workers.

Technology makes it easier to stay connected but, especially with remote workers, it takes a conscious effort to ensure that people are “in the loop.” Some planned face-to-face time now and then can help.

Once you’ve communicated expectations, manage your remote workers the way you manage the rest of your employees – by measuring the results. You’ve communicated your expectations

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and hopefully have some clear metrics to measure results – volume expectations, deadlines, turnaround time, and quality standards. The list goes on and on. Is the employee meeting expectations? Deadlines? Standards? Or aren’t they? If they aren’t, is something about the remote work situation getting in the way? Maybe a little tweaking is needed. If added software, schedule changes, etc. will make a difference, by all means, do it.

However, if it’s an employee performance issue, handle it as you would with any other employee – provide feedback, coach your employee and manage for improvement. Make sure you keep those regular “check-in times” going.

So, back to the question: Are all employees suited for remote work? To succeed in a remote arrangement, an employee needs to have strong time management skills, be goal oriented, trustworthy and capable of delivering results. Doesn’t this describe the qualities you are looking for in all your employees?

If you have a job that can be done from a remote location, the technology needed to ensure remote access to all tools needed to do the job and an employee (or candidate) who meets the above qualities and has an interest in working remotely (not everyone does), what do you have to lose?

Well, it’s now around 11:30 a.m. I’m still in my home office, hard at work on my article. Once I’m done with this, I will probably take a short break for lunch. Then I have another project to work on for a couple of hours, then a client call at 3:00 and three other client projects that need my attention after that. Perhaps a call from an agency owner or manager will come through looking for some HR support. You never know exactly what the work day holds – and that’s true whether you’re “in the office” or working remotely “from home.”

And don’t forget, if you have any questions related to remote work arrangement or other HR-related topics, I’m just an email or phone call away. I can be reached at 610-779-3870 or karen@mostellerhr.com. When we talk, I’ll probably be working from home! n

Karen H. DiGioia provided this article on behalf of Mosteller & Associates, IA&B’s contracted human resources consulting firm. Reach out to Karen for more information on hiring and managing remote workers or with other human resources questions.

IA&B’s HR Solution© is a compilation of products and services – available exclusively for our member agencies – that simplifies establishing or improving your human resources program. It includes base-level consultation and discounted professional services from Mosteller & Associates. Learn more at IABforME.com/emp_mgmt.

CLASSIFIED A DV E R TI S E M E N TS

My Events

SOUTHEAST PA PRODUCERS & AGENCIES

JULY & AUGUST 2016 DATE TOPIC

LOCATION

JULY 2016 6

CISR Personal Residential

Mechanicsburg, PA

7

CISR Personal Lines Miscellaneous

Baltimore, MD

7

CISR Personal Residential

Wilkes-Barre, PA

11-12

James K. Ruble Graduate Seminar

Allentown, PA

11-14

CIC Personal Lines Institute

Erie, PA

12

PA Auto Coverages—Avoiding E&O Potholes

Lancaster, PA

13

Contracts & Leases

Newark, DE

19

William T. Hold: Condo Concepts & Coverage

Frederick, MD

20

CISR Personal Auto

Philadelphia, PA

20

William T. Hold: Condo Concepts & Coverage

Mechanicsburg, PA

20

E&O Risk Mgmt.—Meeting the Challenge of Change

Dover, DE

20-23

CIC Commercial Casualty Institute

Pittsburgh, PA

21

CISR Commercial Casualty I

Reading, PA

21

CISR Commercial Casualty I

State College, PA

26

Understanding Flood Insurance

Salisbury, MD

26

Who, What, When, Where & Why of Workers’ Comp

Pittsburgh, PA

27

CISR Agency Operations

Philadelphia, PA

27

E&O Risk Mgmt.—Meeting the Challenge of Change

Erie, PA

AUGUST 2016 2

William T. Hold: Condos Concepts & Coverage

Salisbury, MD

2-4

PA Property & Casualty Licensing Study Course

Mechanicsburg, PA

2-4

PA Life & Health Licensing Study Course

Philadelphia, PA

3

William T. Hold: Condos Concepts & Coverage

Dover, DE

3-6

CIC Agency Management Institute

Philadelphia, PA

8-9

James K. Ruble Graduate Seminar

Hershey, PA

9

CISR Personal Residential

Allentown, PA

10

CISR Commercial Property

Mechanicsburg, PA

17-18

James K. Ruble Graduate Seminar

Ellicott City, MD

17-18

James K. Ruble Graduate Seminar

Erie, PA

23-25

PA Property & Casualty Licensing Study Course

Philadelphia, PA

24

Contracts & Leases

Pittsburgh, PA

30

CISR Elements of Risk Management

Erie, PA

31

CISR Elements of Risk Management

Pittsburgh, PA

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.

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New Truckers Workers Comp Program

Exclusive to Agents of Interstate Insurance • The existing automobile coverage must be written with Interstate.

• Coverage will be placed with an A.M. Best rated A+ XV rated carrier • Program available in Maryland, Virginia, Pennsylvania, Delaware and North Carolina.

• 5-50 power units but larger exceptional high quality accounts may be considered.

• Target account will be regional for hire trucker (some long haul exposure acceptable).

• $25,000 minimum premium. * Since we will loss control every account we prefer to receive submissions at least 60 days in advance.

- Smaller accounts that underwrite well will be quoted ‘subject to inspection’

* Accounts we will not consider: • Accounts with owner operators • Gasoline/fuel haulers • Moving and storage companies • Trash/refuse haulers with any residential collection • Any operation with extreme loading/unloading exposures

* Very attractive and flexible payment plans available: • Monthly Payroll Reporting • Electronic Pay-As-You-Go • Installment Plans • We will be especially flexible on large accounts

For more information contact Jeff Thomas: jeff@interstate-insurance.com Email all submissions to: submissions@interstate-insurance.com

www.interstate-insurance.com