Delaware Primary Agent - March 2020

MARCH 2020 | DELAWARE

HOW IA&B MEMBER

GREG GUNN DEFINES SUCCESS

Exclusive Member Magazine

LEGISLATIVE VICTORIES GET INVOLVED IN ADVOCACY Q&A WITH COMMISSIONER NAVARRO

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IN THIS

8 ON THE COVER: Q&A WITH GREG GUNN IA&B Member Agent Greg Gunn talks about his career path, his support of AgentPAC, and his love of Penn State sports.

12 CELEBRATING LEGISLATIVE VICTORIES

Read about the budget package passed by Congress late last year and its inclusion of three, long-term priorities for our industry.

16 PROTECT YOUR INDUSTRY

Learn more about the upcoming Big “I” Legislative Conference.

17

GET INVOLVED WITH IA&B’S ADVOCACY

There has never been a better time to get involved in the political process on behalf of your industry. Learn how.

21 INTERVIEW WITH COMMISSIONER NAVARRO

Hear from Delaware Insurance Commissioner Navarro on the state’s insurance market and more.

IN EVERY ISSUE 2 3 4 7 11 22 25 25

Chair of the Board’s Message Claire-ification Coverage Corner IA&B Partners New & Returning Members Pics & Posts Training & Education Classified Ads

CONNECT WITH US: Facebook.com/IABforME LinkedIn.com/company/IA_and_B Twitter.com/IA_and_B

CELEBRATING LEGISLATIVE VICTORIES

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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 # 2020-3, is published monthly by IA&B Service Group Inc., a subsidiary of IA&B. 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

PROTECT YOUR GREATEST ASSET

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

OFFICERS

Chair of the Board

Y

Craig S. Mader Crofton, MD

ou have chosen to invest in your membership with IA&B, and that should be meaningful to you. Your organization exists to offer you licensing and continuing education opportunities, provide errors & omissions coverage, to provide unbelievable resources, and to protect your insurance business through advocacy at the state Capitols.

We have very effective representation in Harrisburg, Annapolis, and Dover. Our lobbyists – Lauren Brinjac, Bryson Popham, and Scott Kidner, respectively – have established and nurtured relationships in the halls of state government and have earned the respect of lawmakers. Believe me, these relationships make a world of difference to you as an IA&B member for the protection of our industry, your livelihood, and the protection of your greatest asset – your business.

My greatest frustration is our members’ apparent apathy or the lack of awareness when it comes to understanding the mission of advocacy and supporting your organization’s state-based political action committee, AgentPAC. Perhaps some feel that they cannot have an impact, don’t feel politically connected, or feel that they are unaffected. Wrong on all counts!

You need advocates who understand your value and protect your turf, and that’s what AgentPAC does. We have a very serious interest in how our businesses are treated. Without your support, we allow the uninformed to chip away at your value as a service professional and the value of your agency. Also, those whose interests are 180 degrees opposed to yours will fill the vacuum created by your inactivity.

We battle trial lawyers who are looking for financial advantage and consumer organizations that do not understand your products. They would just as soon see direct writers deliver our products. To these folks, you are an unnecessary additional expense to the consumer, so make your voice heard by contributing to AgentPAC.

Finally, as Bryson Popham has stated, advocacy is not so much the passing of laws that affect our industry, but preventing those laws that can do us harm.

Support your AgentPAC for results!

Respectfully,

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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

Mark J. Monroe

West Chester, PA

Michael A. Papa, CIC, MBA Hunt Valley, MD

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

Craig Mader Chair of the Board

MARCH 2020

Don’s Discussion Claire-ification IA&B Vice President - Advocacy Claire Pantaloni, CIC, CISR provided this month’s answer.

Are you a member with a question? Contact Claire to find the answer at 800-998-9644, ext. 604 or ClaireP@IABforME.com.

QUESTION: What are the implications of giving our customers access to their policy through our agency management system’s web portal?

ANSWER: Delivering a policy electronically, which includes sending it via email or making it available through web access, is considered an “electronic transaction.”

You must therefore make sure you comply with the laws and regulations governing compliance with electronic transactions. If you don’t, the electronic document might not be considered valid.

straightforward, or at least should be fairly easy to establish. Regarding the third one, at this time, we are not aware of any case law that would shed light on how accessing the policy through a consumer portal affects when the insured is considered to have “received” the policy and, as a result, when the insured’s duty to read the policy is triggered.

As we’ve discussed in prior editions of Primary Agent, the main E&O issues which are triggered with electronic delivery of a policy are:

Absent any case law, common sense would dictate that the email notifying of policy availability and making the process to access the portal and the policy available could serve as the trigger. As a precaution, a best practice would be to send the email notification as soon as the document is available, and strengthen the email by urging the customer:

• Was disclosure to transact electronically provided and consent secured?

• If personally identifiable or otherwise sensitive information is on the documents, how was the information secured when transmitted or provided electronically?

• How is delivery of the documents ascertained that triggers the insured’s duty to read the policy?

The fact that the policy is accessed through a consumer portal rather than via an email attachment still requires the three items above to be addressed. The first two bullet points should be pretty

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.

• to read the policy, and • to contact the agency immediately with any questions or concerns.

To review the advantages of using electronic transactions and the best ways to comply with the requirements, review our full resource at IABforME.com/ electronic transactions.

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COVERAGE CORNER

PERSONAL STORAGE RISKS Featuring Showtunes, Packrats, and a Mama’s Boy?!

By Kevin C. Amrhein, CIC

S

chnitzel with noodles? Debatable (it really comes down to the sauce).

But when it comes to silver white winters melting to springs, Julie Andrews and I are in complete agreement (some of you may need Google to make sense of that. If you didn’t, then the song is now stuck in your head indefinitely. You’re welcome!)

It’s March, and spring is (hopefully) in the air. Alongside warming temps, America’s most popular season provides many reasons to smile. For example: Spring break!

Spring training (go Marlins!)

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Spring … cleaning? Yep. Many folks crave that euphoric feeling a fresh look, reorganization, or remodel provides.

When you cleared old stuff from those cabinets (So there’s that bright copper kettle!) and closets (Have you seen my warm woolen mittens? What? You threw them out? HOW COULD YOU?!), did you get rid of it or simply move it elsewhere? As much as humans love a freshening-up, we struggle to discard things, possibly creating a coverage concern in the Homeowner’s policy regarding items stored at or away from the “residence premises.” (Note: All policy language appearing in this article is from the ISO Homeowner’s policy.)

MARCH 2020

STORING STUFF AT THE ‘RESIDENCE PREMISES’ Provided the nature/quantity of items stored doesn’t create a valuation concern, the policy broadly covers damage to personal property while stored at the “residence premises.” That said, an inadequate personal property valuation can cause big problems at claim time and agents/carriers should continue to recommend doing a home inventory at least annually.

Further, agents and insureds should revisit the list of sub-limits applicable to specified personal property found in the policy’s

Special Limits Of Liability section. For example, the insured recently may have stored family heirlooms like silverware or jewelry (loss by theft limited to $2,500 and $1,500 respectively) or a trailer (limited to $1,500 and other peril-specific restrictions.)

STORING STUFF AT ANOTHER PREMISES There’s still plenty of stuff to be stored, but your insured has squeezed every conceivable inch of space out of his home.

So he does what anyone would when faced with such a crisis … calls his mother.

This isn’t her first time getting this call, and she always makes room for his stuff at her home. While it’s true that his policy limits coverage for stored personal property at certain locations (discussed below), there is no limitation applicable to his mother’s home. Thus, if damaged there by a covered peril, he would have access to his full Coverage C – Personal Property limit (subject to all other policy conditions).

STORING STUFF AT ANOTHER PREMISES, PART II So what about moving things to another premises that is a residence of an insured or a self-storage facility? In two circumstances, the policy will limit coverage applicable to stuff stored away from the “residence premises” to 10% of the limit of liability for Coverage C – Personal Property or $1,000, whichever is greater.

First, such limitation applies to stuff stored at another residence of an insured that is not the “residence premises” as scheduled on the policy (for example, if stuff is stored at the insured’s condo or lake house.) An exception to this limitation is made for stuff stored in a newly acquired principal residence for up to 30 days from the time the named insured began moving stuff there.

Second, such limitation applies to stuff stored in a self-storage facility. An endorsement may be available to increase

this limitation (for example, HO 06 14 – Increased Amount Of Insurance For Personal Property Located In A SelfStorage Facility.)

Note that in both circumstances, an important exception applies. The limitation “does not apply to personal property moved from the ‘residence premises’ because it is (a) being repaired, renovated or rebuilt; and (b) not fit to live in or store property in.” For example, if the insured is utilizing a self-storage facility due to a serious fire at the home or during a significant remodel that requires the family to reside elsewhere, no limitation would apply should the stored stuff be damaged by a covered peril.

AN HOUR WITH KEVIN Earn 1 CE credit from new hour-long webinars, featuring the alwaysentertaining IA&B Education Consultant Kevin Amrhein, CIC. Coverage Concerns for Serious Storm Events MARCH 12

FINALLY, A WARNING TO AGENTS By now, no one reading this is a stranger to the concept of the sharing-economy.

I’ve been following it for years, and I’m still amazed at how it continues to evolve into seemingly every facet of life.

Personal storage space is no exception, and companies like storeatmyhouse.com and neighbor.com are among those hoping to capitalize. Such companies market themselves as the Airbnb equivalent of personal storage space – helping those with extra space connect directly with consumers who want to store stuff there for a fee. Should your insured wish to earn some cash by participating in such, a review of the Homeowner policy’s definition of “business” and its application to property and liability coverage is essential.

11 AM – NOON

More Coverage Concerns for Serious Storm Events MARCH 26 2-3 PM

Register today.

IABforME.com/webinars 800-998-9644, option 1

Kevin C Amrhein, CIC, is IA&B‘s newest 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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IA&B PARTNERS PROGRAM

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OUR COMPANY Acuity

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More than ever, people want to work for and do business with companies that not only provide quality products and services, but that operate ethically and have a clear focus on their mission and purpose. Acuity’s focus statement reflects who we are and what we strive to be as an employer, business partner, and insurer: Rebuilding Shattered Lives; Propelled by Innovation; Grounded in Relationships.

These three statements share a common focus: people. At Acuity, our people make the difference.

We take the time to know agents and their customers, and we deliver the right protection at a fair price. We’re motivated by customer satisfaction, which is why we earn a 95% satisfaction rating in claims from customers and maintain a reputation for innovative products and service excellence.

We understand what people care about and promise to be there to help protect it. Acuity insures over 100,000 businesses, including 300,000 commercial

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MARCH 2020

THANK YOU vehicles, and nearly a half million homes and private passenger autos across 28 states. We generate over $1.5 billion in revenue through 1,000 independent agencies and manage over $5 billion in assets.

In personal lines, Acuity provides true tiered rating programs in both auto and homeowners.

In commercial lines, Acuity offers monoline and commercial package policies, businessowners’ (BOP) forms, and endorsements designed for targeted classes of business, including contractors, truckers, retailers, service businesses, and manufacturers. We offer agents an expansive continuing education (CE) program featuring courses taught by expert Acuity staff as well as award-winning video courses. In the past four years alone, agents have earned over 127,000 CE credits through Acuity, at no charge.

Acuity also offers independent agents stability that spans years of financial and operational performance.

Rated A+ by both A.M. Best and Standard & Poor’s, Acuity is the only regional insurer to have been named to the Ward’s 50 list of top-performing propertycasualty companies for 20 consecutive years. Named a Best Employer by Forbes in multiple categories, Acuity also features remarkably low staff turnover among its more than 1,400 staff members, helping build stronger relationships.

BECOME A 2020 PARTNER TODAY Interested in becoming a partner?

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The IA&B Partners Program allows companies to support and connect with independent insurance agents and brokers in Pennsylvania, Maryland, and Delaware. Through their sponsorship, Partner companies allow IA&B to offer the programs and services that help member agencies succeed.

PLATINUM PARTNERS Acuity Donegal Insurance Group Erie Insurance Farmers Mutual Fire Insurance Company of Marble Insurance Agents & Brokers Service Group Millers Mutual Group Penn National Insurance Plymouth Rock Assurance The Main Street America Group

GOLD PARTNERS Chesapeake Employers Insurance Company Chubb EMC Insurance Companies Illinois Casualty Company Keystone Insurers Group Inc. Lackawanna Insurance Group Liberty Mutual Business & Safeco Insurance MMG Insurance Company Mutual Benefit Group Nationwide Insurance Company Openly Insurance Progressive

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Q&A WITH

GREG GUNN

G

reg Gunn, CIC, is managing partner of Gunn-Mowery, LLC, a full-service insurance broker with 70 employees in four Central Pennsylvania offices. He serves on the board of directors for IA&B, as well as the Independent Insurance Agents & Brokers of America (Big “I”).

Q. After graduating from the Pennsylvania State University, your first job was at an insurance agency.

Was that the plan all along? What drove you to the industry, and why did you stay?

A. I was a finance and math major at Penn State. I intended to work for a couple years and then go back to school for a master’s. I had two local job offers right out of college. When I couldn’t decide between the two, Byerly Insurance raised their salary offer and gave me a signing bonus. So, I signed on. After a couple years, I liked it, was making a fair amount of money, and decided to stay with insurance rather than going back to school. I love the idea of helping people and choosing who you do business with.

I can honestly say I have enjoyed virtually every single day of it.

Q. You and your business partner, Ted Mowery, have worked together since 1988 and built an impressive enterprise! What is your advice for maintaining a long-term business partnership?

A. Easy. Find a great partner that you can trust completely and then communicate openly and consistently. OK, finding a great partner might not be that easy, but I got lucky. I trust Ted’s integrity 100% all day all night. We also were fortunate in that our visions for the future were compatible … or at least he tolerated mine with a smile on his face.

Our philosophy has always been to surround ourselves with great people.

Honest, professional, energetic, smart, hardworking people. As you can image, Ted and my relationship is also better because of that. Imagine how cool it is to go to work with 70 terrific people every day.

Q. Gunn-Mowery has acquired a number of other agencies over the years. How have you maintained your agency culture despite significant growth and now multiple locations?

A. Well, we have learned. We used to tell firms we were going to acquire that they could keep doing things their way.

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MARCH 2020

Then we learned how bad an idea that is on several fronts. So now they are told they must do things our way, but we are always willing to listen if they have a better way. They also know our philosophy up front – we want to enjoy what we do while focusing on our clients and their needs 24/7.

When we talk to other agencies, we are really looking for wonderful people.

We want to make sure if we do a deal, it becomes the best thing that could possibly happen for the other agency’s principals, employees, and clients. We have an obligation to both of our teams to make sure it works, and its important to us that everyone involved can be very proud of what we accomplish together long term.

Q. Your agency employs a diverse staff, spanning several generations.

What’s your philosophy for finding and retaining young talent?

A. We never stop looking for people.

Sometimes we hire even when we do not have an opening if the right person comes along. Our culture is about getting great people, training them well, and getting out of their way while working together to protect our clients. Insurance can be a lot of fun, it is a never-ending educational opportunity, and it has a future. Gunn-

Mowery is going to be a survivor, and we hope they see value in jumping on the bus, coming along for the ride, and maybe even having an opportunity to drive the bus down the road.

Q. You are a generous and consistent contributor to IA&B’s political action committee, AgentPAC. What drives your commitment?

A. It is imperative for insurance agents to communicate the needs of our industry to our legislators. If we don’t, someone else will, and we may not like the results. Legislators need to hear our story and understand we are there to protect consumers, who are our clients, and we know the issues and the pressing needs better than anyone because we live it every day. In order to access to those legislators, it helps to provide some measure of support. If not me, who? If not now, when?

and serving the independent agency system. The combination of IA&B at the state level and the Big “I” at the federal level is a very powerful team that does a lot for independent agents every single day. I am honored to be a part of that effort.

Q. We understand that you have a side venture – Logan’s View Winery! How did this come about, and what’s your favorite of the wines produced there?

A. Nineteen of my closest friends and I looked at buying a winery in York County many years ago, and

Access the tools you need to better serve your clients!

Q. For several years running, you’ve attended the Big “I” Legislative Conference in Washington, D.C. What makes it a worthwhile event, and why should other IA&B members from Pennsylvania and Delaware attend?

A. It is a powerful event bringing together close to 1,000 agents. It gives us an opportunity to interact, discuss issues, and meet with our legislators to help them understand our concerns and to hear their thoughts. If you have not been to a legislative conference, you are missing out on one of the best events in our industry. It should be on the bucket list of every insurance agent in the United States.

Q. What have you learned from your time on the Big “I” Board of Directors?

A. The Big “I” is a great organization with some spectacular resources, and its board is made up of 50 agents from 50 states who are dedicated to protecting

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when the asking price was too high, we looked at each other and said, “Oh, heck, let’s start one ourselves.”

So, we did.

While Logan’s View produces 20+ types of wine each year, my favorites are the blends. We blend 15% fruit wine with 85% grape wine and produce fascinating results. Strawberry Blonde is Chardonnay with a bit of Strawberry mixed in. Slightly sweet but not as sweet as an all fruit wine.

Blackberry Nights is Merlot with a hint of Blackberry. The blends are something different and sell out very quickly.

Innovation is, in this case, profitable.

Q. You seem to be very engaged with your community. How do you find the time to do it?

A. When we started Gunn-Mowery, my wife and I talked about what would define success for us. It would not be

about money or size. We felt if we could move the needle in our local communities and leave them better than we found them, we would be able to call Gunn-Mowery a success. So from day one, our motive has been to give back. I have personally served in leadership roles at over 10 major non-profits because I really want to help in areas where GunnMowery can be of assistance. We are all in this together, and we owe it to the communities we serve to help make them a better place to live, work, and play.

favorite event is every single game we get to spend with family and friends. Our daughter, EJ, comes back from Charlotte for about half the games (even as a Wake Forest alumni), and our son, Nick, comes to about the same (he attended Penn State, so it doesn’t take a lot of convincing). We also go to basketball and hockey games and really need to get to some wrestling matches. There is not one event that stands out – it’s every event that we can be there with the folks we care so much about.

Q. You bleed blue and white. (For non-Central PA readers, this is Penn State Nittany Lion talk.) What’s the most exciting sporting event you’ve attended in State College, and why?

Oh, OK … the October 2016 football game where we blocked a fourth quarter field goal for a touchdown to beat No. 2 Ohio State is right up there!

A. My wife, Val, and I are Penn State grads and have a house there. And GunnMowery has an office in State College.

We have football season tickets, and our

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MARCH 2020

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Have a question about your member benefits? Contact Tim Wonder, VP-Membership, 800-998-9644, ext. 351 or TimW@IABforME.com

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MARCH 2020

CELEBRATING LEGISLATIVE VICTORIES

By Lauren Brinjac

Late last year, Congress passed a budget package that included three, long-term priorities for the independent agency system. Read about the hardfought wins and how you’ll benefit from them.

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I

t is easy to become frustrated by the legislative process.

There are numerous hurdles to overcome for a bill to become a law, and the process often seems tiresome and inefficient. The vast majority of bills introduced into Congress never even receive a vote. This, however, is not necessarily a bad thing when you consider the fact that each and every one of the 535 individuals who make up the U.S. Congress can introduce any piece of legislation they want.

To break through the noise, we rely on our national association in Washington D.C., the Independent Insurance Agents & Brokers of America, Inc. (the Big “I”) to be the eyes, ears, and most importantly, the outspoken voice of the agent community on Capitol Hill.

While focusing on the frustrations, it sometimes is easy to overlook the legislative victories we do achieve. However, thanks to the leadership of the Big “I” and the grassroots assistance of thousands of independent agents and brokers all over the country, we scored three big wins at the end of 2019. The spending package (to fund the federal government for the remainder of the fiscal year through Sept. 30, 2020), passed

by Congress with a bi-partisan vote and signed into law by President Trump, contained three major legislative priorities of insurance industry stakeholders:

TRIA REAUTHORIZATION The Terrorism Risk Insurance Act (TRIA) was set to expire on Dec. 31, 2020. In a win for the insurance industry, the funding package passed late last year included a seven-year extension of TRIA without making any significant changes to the program.

TRIA, which has provided a federal backstop for terrorist-related insurance claims since being signed into law by President Bush in 2002, last was reauthorized in 2015. Failure to reauthorize the program likely would have had a significant impact on the market for terrorism coverage, as the threat of a terrorist attack, as well as the inability of the private market to properly underwrite the risk associated with potential attacks, still exists in a very real way.

NFIP REAUTHORIZATION Another federal insurance program reauthorized in the spending bill is the National Flood Insurance Program (NFIP). The NFIP, which has been operating under a series of more than a dozen short-term reauthorizations over the last two years, was set to expire on Friday, Dec. 20, 2019. Under this legislation, the program was extended for nine months through Sept. 30, 2020.

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The last long-term NFIP extension was passed in 2012 as part of the Biggert-Waters Flood Insurance Reform Act, which extended the NFIP through Sept. 30, 2017. For years, the lack of agreement over structural reforms to the cash-strapped program has prevented lawmakers from coming together on a longer-term program reauthorization. The independent agent and broker community continues to lobby Congress to pass a multi-year program reauthorization with reforms to modernize the program, as well as to educate lawmakers on the important role agents play in securing flood coverage for their clients.

‘CADILLAC TAX’ REPEAL Thirdly, the spending package also fully repealed the Affordable Care Act’s (ACA) 40% excise tax, or “Cadillac tax,” on employer-sponsored health benefits that exceed an established annual cost. Repeal of this tax has been a longtime priority of the agent and broker community and has had bi-partisan congressional support.

While focusing on the frustrations, it sometimes is easy to overlook the legislative victories we do achieve.

— Lauren Brinjac, IA&B Government Affairs Director

The tax originally was scheduled to go into effect in 2018 on health benefits exceeding an established annual cost. Congress in 2015 delayed the effective date to 2020. The tax got a second two-year delay as part of government-funding legislation signed into law by President Trump in January 2018, which delayed the effective date of the tax until 2022.

Health plans (including HSAs, FSA, and supplemental insurance) exceeding $10,200 a year in value for individuals or $27,500 a year for families would have been subject to the tax.

Although this provision of the ACA was billed as a tax on highcost health plans (thus the moniker “Cadillac tax”), over time the tax would have affected more and more individuals because

MARCH 2020

Congress tied the threshold to a slow measure of inflation that would not keep up with the rising cost of healthcare.

LOOKING AHEAD No matter the victories achieved, there always are a host of issues at the federal level that affect not only how agencies operate but also how the insurance industry as a whole functions. For example, a perennial issue for the industry is advocating in support of the current system of state-based insurance regulation – and the consumer protection it affords – and preventing any unnecessary federal encroachment into insurance regulation. Additionally, there is inevitable turnover in Congress after every election cycle (and will be again after the election this fall), and new lawmakers will need to learn about the value of the independent agent and broker community. Fortunately, agents and brokers remain a strong political force, ready for whatever opportunities and challenges each session of Congress may bring.

Lauren Brinjac is government affairs director for IA&B. Reach her at 800-998-9644, ext. 607 or LaurenB@IABforME.com.

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63rd annual

to the

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

A ll members from

welcome PA • MD • DE

Register Today. Don't Miss Out. IABforME.com/DEconvention or 800-998-9644, option1 15

PROTECT YOUR INDUSTRY JOIN US FOR THE BIG “I” LEGISLATIVE CONFERENCE

By Lauren Brinjac

(clockwise from top left): IA&B members meet with DE Sen. Chris Coons, PA Rep. Dan Meuser, and PA Rep. Lloyd Smucker at the Big “I” Legislative Conference.

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Y

ou have a strong government affairs team at the Independent Insurance Agents & Brokers of America (the Big “I”) advocating for your interests daily in Washington, D.C. They build relationships with federal lawmakers on both sides of the aisle and educate them on the issues important to the independent insurance agent and broker community. Their effectiveness may make it easy for you, as a busy insurance professional removed from the day-to-day workings of Congress, to assume that they have things covered. But, it’s not quite that simple.

YOUR ROLE An effective advocacy program is like a three-legged stool – with even one leg missing, the stool cannot stand. Your lobbyists at the Big “I” are one leg of the stool; a well-funded political action committee (InsurPac) that can support the election of agent-friendly candidates to office is another. The third, and arguably most important, leg of the stool is grassroots advocacy: the network of thousands of insurance agents and brokers across the country who are federal lawmakers’ constituents.

It makes sense: For a lawmaker, it’s critical to listen to the people who can vote you into (or out of ) office. For an independent agent, it’s critical to make your congressional representatives understand how the votes they cast and the decisions they make affect your livelihood. You, someone who lives and breathes the insurance industry on a daily basis, are your own best advocate.

Helping your lawmaker understand the bottom line, real-life implications of a policy that might seem simple on paper can and does affect how he or she will vote on an issue. And, every vote really does matter.

HAVE YOUR SAY You have a great opportunity to take part in effective grassroots advocacy by attending the Big “I” Legislative Conference. Held every spring in Washington, D.C., the Legislative Conference brings together over 1,000 agents from across the country for a one-of-a kind event exclusively for the members of the independent agency system to educate members of Congress on the issues important to you and your clients.

This year’s event takes place May 13-14 at the Hyatt Regency on Capitol Hill.

The event is suitable for agents of any experience level. You need not feel that you are politically savvy in order to attend: Registration includes an in-depth issues briefing prior to your visits on Capitol Hill, and you will be with a group of your fellow agents from Pennsylvania/Delaware as you meet with federal lawmakers. Issues on which agents recently have advocated include: reform and reauthorization of the National Flood Insurance Program, the Federal Crop Insurance Program, tax reform, insurance regulatory reform, health care, and (of increasing importance) cybersecurity.

In addition to advocating on behalf of your industry, the Legislative Conference is a great opportunity to network. You will have time to meet and mingle with your agents at a dinner exclusively for IA&B members, as well as a pre-Capitol Hill visit breakfast hosted by the Big “I” for all attendees.

A show of grassroots strength on Capitol Hill is a critical way to bolster the impact of the independent agent and broker community on legislative issues throughout the rest of the year. There has never been a better time to become politically active.

auren Brinjac is L government affairs director for IA&B. Reach her at 800-998-9644, ext. 607 or LaurenB@IABforME.com.

GET THE DETAILS WHO: You and your fellow independent agents and brokers from around the country

WHAT: Attend the Big “I” Legislative Conference

WHEN: May 13-14, 2020

WHERE: Hyatt Regency on Capitol Hill

WHY: To protect your industry

HOW: Learn more and register at IABforME.com/Leg_Conf

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2019 AgentPAC of Delaware Contributors We sincerely thank the following contributors. Their financial support of AgentPAC in 2019 helped to make sure that their voice, collectively with other agents’, was heard during the legislative process. What’s more, it helped us as we advocated for ways to strengthen agents’ political interests on key insurance and business issues in Delaware.

Learn more and support AgentPAC in 2020 by visiting IABforME.com/DelPAC.

GOVERNOR’S CLUB ($500 - $999)

SENATE LEVEL ($250 - $499)

HOUSE LEVEL ($100 - $249)

John Yasik Poland & Sullivan Insurance Inc.

Richard Corroon Weymouth Swayze & Corroon Insurance Inc.

E. Stephen Burnett Insurance & Financial Services

Lee Dotson Bellevue Insurance Services LLC Rick Evans R.E. Evans Insurance Inc. John Peppelman Affordable Insurance Network of Delaware Howell Wallace Pratt Insurance Jim Watkins Pfister Insurance Inc. David Wilgus Wilgus Associates Inc.

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William Davis Davis Insurance Group Inc. Joseph Moore Williams Insurance Agency Inc. Peter Wolff Wolff Insurance Agency

UP TO $99 Jason Bonardi Travelers Jeffrey Good S.T. Good Insurance

Get involved to support IA&B’s in-house government affairs team (left to right): President & CEO Jason Ernest, Esq.; Government Affairs Director Lauren Brinjac; and Vice President - Advocacy Claire Pantaloni, CIC.

GET INVOLVED WITH IA&B’S ADVOCACY EFFORTS

T

here has never been a better time to get involved in the political process on behalf of your industry. One thing is certain: Lawmakers in Dover continually make decisions that affect you, your business, and your clients. It’s vital for the independent insurance agent and broker community to have a role in this decision-making process. As the saying goes, “If you’re not at the table, you’re on the menu.”

Your input is critical in this process.

Although you have a team at IA&B continually advocating on your behalf, we still need your voice. If you would like to join your fellow IA&B members who are involved in the political process, there are several ways to do so. (Note: It’s your interest in the process and knowledge as an insurance professional that are most

valuable; you need not have prior political experience to get started.)

GOVERNMENT RELATIONS COMMITTEE The Government Relations Committee plays an important role in the association’s advocacy program by providing input to our legislative staff to guide policy development and help shape legislation to benefit the industry and small businesses.

Time commitment: The committee meets as necessary during the legislative session – usually two or three times a year. Most meetings are via conference call, but occasionally in person in Dover.

Learn more and volunteer: IABforME.com/gr_position

KEY CONTACT Lawmakers prioritize hearing from their own constituents (those members of their district responsible for voting them into or out of office). If you have a personal relationship with your local legislator and are interested in communicating with him or her about issues important to the insurance agent and broker community, let us know. Additionally, if you have interest in testifying or acting as a resource at legislative or regulatory meetings and public hearings, we’d like to hear from you.

To learn more and volunteer, contact IA&B Government Affairs Director Lauren Brinjac at 800-998-9644, ext. 607 or LaurenB@IABforME.com.

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AN INTERVIEW WITH

COMMISSIONER NAVARRO

I

A&B earlier this year asked questions of Delaware Insurance Commissioner Trinidad Navarro about his background, the state’s insurance market, and the role of insurance producers. His responses follow.

IA&B: Before becoming insurance commissioner, you served for over 20 years with the New Castle County Police. What drew you to the position of insurance commissioner? What have been the biggest surprises you’ve found in the role of commissioner over the last three years?

Navarro: After serving as a police officer for 20 years, I was elected New Castle County Sheriff in 2010. During my six years in that role, I was frustrated to experience the department’s limited authority to prevent people from losing their homes in sheriff sales. My team and I advocated for individuals victimized by investors purchasing those properties and unlawfully taking personal possessions, but I found that people needed more help than we could provide. And in figuring out what roles have the authority to be stronger consumer advocates, I became more interested in pursuing the role of Insurance Commissioner.

Though I wasn’t an insurance expert before running for Commissioner, I wasn’t an insurance industry rookie either. I was a licensed insurance agent in the past, and my father worked in the

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industry as well. We saw our clients like family, experiencing firsthand the impact insurance can have on consumers and their lives. Coupled with my experience in law enforcement and as Sheriff, I came to see the Insurance Commissioner as our state’s strongest consumer protection officer, and I knew that residents needed someone to educate them on insurance, protect them by standing up to insurance companies, and advocate on their behalf with both companies and the legislature. I saw the opportunity to use my experience and passion to police the industry, suppress rate increases, hold companies accountable, and generally be fair but firm.

When I first attended the National Association of Insurance Commissioner (NAIC) conference, colleagues warned me that the first year would feel like drinking from a firehose, and they were right. I’m grateful to have such an experienced team within the department who helped me get up to speed quickly. I have been surprised by the global impacts our small state produces, from the leading-edge legislation we advocate for, to the market conduct examinations we work with other states to complete, to domiciling hundreds of captives and traditional companies.

IA&B: What are the most common consumer complaints that you receive?

Navarro: What we hear the most is residents’ concern about the responsiveness of insurance companies, and issues

with fair and timely payment of claims.

Consumers pay companies for service and should be treated well when they need to file a claim – that includes when the value of their claim is being determined by a company. Our consumer services division has decades of experience in independently investigating and successfully resolving consumer complaints.

I will say that despite a perceived national trend of agents and brokers “churning” the sale of insurance and annuity products, our investigations found that this hasn’t been a significant problem in Delaware.

In fact, we very rarely receive complaints about local agents and brokers, and I’m appreciative of the work that goes into creating such an ethical environment.

And – I’m really proud of this – even when residents make contact with the Delaware Department of Insurance for the first time to make a complaint, and they are angry or upset about their issue, they often call back with a message of appreciation and thanks for our hardworking team when we help them to resolve it.

IA&B: What have been your biggest concerns about the health insurance marketplace, and how are they being addressed here in Delaware?

Navarro: My biggest concern about the health insurance marketplace, which I think the public feels as well, is the uncertainty in Washington about what

the future holds for the Affordable Care Act. Without the sturdy foundation of a supportive federal environment, companies were hesitant to join the marketplace or to stay in it, leading to a lack of competition and increasing premiums for a few years. After carriers had lost hundreds of millions of dollars in the early years of the ACA, Aetna left every state’s marketplace in 2017, which locally meant that we had only one carrier remaining in the exchange.

While we still need strong advocates in courtrooms and in our nation’s capital, we aren’t sitting idly by. Just last summer, we were able to codify the protections of the ACA in Delaware with the help of the General Assembly in case the ACA as we now know it is ended.

In 2018, we made sure that women will retain the access to contraceptive coverage that the ACA promised.

We have seen stabilization in the Delaware market. With the help of the Delaware Department of Health and Social Services and our consultant Oliver Wyman, Delaware applied for and was approved for a 1332 Waiver through the federal government. As a result, we were able to decrease rates for the first time in the history of the ACA in Delaware, realizing an average 19% decrease in health insurance premiums on the exchange.

Also for the first time, Highmark made a profit on the exchange. Other companies have taken notice, and we continue to encourage increased competition to offer more options and lower premiums.

IA&B: Technology is advancing rapidly, leading to on-demand insurance models. What are your thoughts on the future of insurance distribution and producers’ role in it?

Navarro: As readers know, InsurTech has been a primary topic of discussion of late, whether at conferences or in concept creation. I believe there is a market for on-demand insurance products in the P&C world, but there will always be a role for producers in insurance. A benefit of InsurTech that I see is that technology itself holds very little bias, but programmers, whether intentional

or not, can be biased. Marketing, selling, and administering products in a way that is free of unintended bias by using technology is a positive.

One of the biggest challenges with InsurTech is ensuring that our regulations allow for this integration. Complex algorithms and/or artificial intelligence can be used to within several aspects of the industry, but it can’t fully replace the benefit of having an experienced professional who understands the regulations in a specific state and can make quick adjustments when those regulations change.

IA&B: Overall, what do you see as Delaware’s strengths and weaknesses as an insurance marketplace?

Navarro: The market in Delaware has been and will continue to be a great location for companies to conduct business. We have no sales tax, and we incorporate over half of the Fortune 500 companies. One of our greatest strengths is our size – we are a state of neighbors and relatives who believe in helping one another, doing things the Delaware way. Our department, along with the industry and the public, has easy access to legislators and the power to create change.

From a departmental standpoint, we have a very experienced regulatory staff with numerous staff members with 20 plus years of experience who also strive to be accessible to all. From helping thousands of seniors register for Medicare to reducing workers’ compensation rates for three consecutive years, our team has shown that we are here to help everyone – doctors and medical facilities, insurance companies, home owners, seniors, agents and brokers, drivers, business owners – everyone.

IA&B: What are your main priorities to accomplish this year? And how can independent agents help you achieve them?

Navarro: In 2019, we promoted more than a dozen of pro-consumer bills that were passed by the General Assembly and signed into law. From cyber-security to codifying the protections of the Affordable Care Act, our new laws were designed

to protect the insurance consumer. That focus won’t change in the year ahead.

As the newly appointed Chair of the NAIC’s Antifraud Task Force, I’ll be working with insurance regulators across the country, as well as local, state, federal, and international law enforcement and antifraud organizations. We’ll provide guidance and resources for departments across the country to reduce, prevent, track, and analyze fraud. Locally, we will be working with the General Assembly and the Attorney General’s office to legislate on this issue.

We also plan to: • Look for new ways to reduce rates within the small group market • Increase capacity of our Fraud and Medicare Assistance Bureaus • Make strides in implementing the Office of Value-Based Health Care Delivery • Protect consumers in contracting processes by updating our assignment of benefits laws • Enhance homeowners’ regulations, particularly for disclosures and non-renewals • Create a more consumer-friendly auto insurance environment and increase departmental efficiency by making it easier to appeal cancellation and nonrenewals • Seek clarifying language around the private funding of bail bond agents to ensure unauthorized individuals are not holding undue power in the industry • Pursue renewal of our national accreditation We’re also active in the legislature, working with members to ensure the effectiveness of their consumer-friendly bills.

Independent agents can help us by sharing their feedback on our efforts and being open and honest about the needs that they have. The better that we communicate, the better we can advocate.

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PICS & POSTS

Facebook.com/IABforME LinkedIn.com/company/IA_and_B Twitter.com/IA_and_B

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MARCH 2020

2019 InsurPac Contributors from Delaware InsurPac is the PAC of your federal advocacy team, the Independent Insurance Agents & Brokers of America (the Big “I�). It solicits voluntary, personal contributions from agents throughout the country and then distributes that money to congressional representatives, senators, and candidates for federal office who support small business and the independent agency system.

Learn more by visiting InsurPac.com/form.

GOLD CLUB ($500 - $999) Kevin Malloy Pratt Insurance PIONEER CLUB ($250 - $499) Howell Wallace Pratt Insurance Larry Wilson S.T. Good Insurance FOUNDERS CLUB ($150 - $249) Mel Warren Pfister Insurance Inc. Jim Watkins Pfister Insurance Inc. John Yasik Poland & Sullivan Insurance Inc. CONTRIBUTORS ($1 - $149) Richard Corroon Weymouth Swayze & Corroon Insurance Inc. Robert Swayze Weymouth Swayze & Corroon Insurance Inc. David Wilgus Wilgus Associates Inc.

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IA&B works on your behalf to ensure that Delaware legislators and regulators understand the issues affecting agents.

And your financial support amplifies your message.

Please consider contributing.

More information at IABforME.com/AgentPAC

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MARCH 2020

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