MAY 2022
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MAY
2022
CONTENTS FEATURED 4
THE LATEST ON DOGS AND HOMEOWNERS’ INSURANCE IA&B Education Consultant Kevin Amrhein takes a deep dive into coverage of petrelated claims under the most recent ISO Homeowners’ Policy.
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> > > > 12
Q&A WITH CANDI SHOUPE CBM Insurance COO/Partner and IA&B Board Member Candi Shoupe looks back at acquiring agencies during the pandemic and offers advice for new producers. RETENTION AND HIRING TIPS TO THRIVE IN THE TALENT SHORTAGE IA&B HR Consultant Karen DiGioia shares tried and true tips for employee retention and hiring during “The Great Resignation.”
JOIN US ON SOCIAL MEDIA: Facebook.com/IABforME LinkedIn.com/company/IA_and_B Twitter.com/IA_and_B YouTube.com 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, 650 Wilson Lane, Suite 200, Mechanicsburg, PA 17055. Primary Agent (ISSN 1543-3110), Permit # 638-620, Issue # 2022-5, is published monthly by IA&B Service Group Inc., a subsidiary of IA&B. Copyright 2022. 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.
MONTHLY 2 3 6 17 20 23 25
CHAIRMAN'S MESSAGE DON'S DISCUSSION NEWS & NOTES E&O PREVENTION PICS & POSTS STAFF PROFILE UPCOMING LIVE WEBINARS IABforME.com |
1
CHAIRMAN'S MESSAGE
WHEN THE DUST SETTLES
INSURANCE AGENTS & BROKERS 650 Wilson Lane, Suite 200 Mechanicsburg, PA 17055
While it’s safe to say we’re all ready to put COVID-19 in the rearview mirror, it’s not quite that simple. Even as the public health threat and related restrictions wane, the aftershocks – economic and social alike – are here to stay for quite some time.
191 Main Street, Annapolis, MD 21401 800-998-9644 | IABforME.com
As insurance producers, we must be vigilant in light of our insureds’ “new normal” and their corresponding exposures. (Personal lines agents: See Kevin Amrhein’s column on page 4, which is timely following the “pandemic puppy” boom.) When it comes to customer service, communication, and transactions, consumers’ expectation of immediacy has only increased during the pandemic. (IA&B Member Candi Shoupe touches on this trend in her interview on page 10.)
Richard M. Rankin, CIC, Chair Lancaster, PA
For those of us in management, the repercussions of the pandemic continue to reverberate in talent shortage – only exacerbating our industry’s prior struggles with recruitment and retention. On page 12, IA&B HR Consultant Karen DiGioia offers ideas to combatting “The Great Resignation.” Bottom line: While the worst of the pandemic appears to be behind us, the world is not – and will not – be the same as it was in early 2020. As insurance professionals and employers, we must adapt and recognize the opportunities this presents us. We are an industry of entrepreneurs and self-motivators, so I am confident that when the dust finally settles, we will land in a place of strength. Best,
IA&B BOARD OF DIRECTORS OFFICERS
D. Bradley Rosenkilde Jr., Vice Chair Hunt Valley, MD
MEMBERS Gregory H. Bennett
Bel Air, MD
Sarah M. Brown, CIC, CRM, AFIS Shrewsbury, PA Andrew Enders, Esq.
Harrisburg, PA
Len Gieseler, LUTCF
Pottstown, PA
Lisa A. Leach Goth, CIC
New Bethlehem, PA
Christopher J. Miller, CIC
Jonestown, PA
Michael A. Papa, CIC, MBA
Hunt Valley, MD
William H. Purdy
Sunbury, PA
Kent Reynolds, CIC
Hagerstown, MD
Jason Rodriguez
Wilmington, DE
Donna Roper
York, PA
Candace Shoupe, AAI, AIC
New Castle, DE
Tara S. Silfies, CPCU
Bethlehem, PA
Robert L. Smyrl Jr., CIC
Hatfield, PA
Michael Thomas
Gambrills, MD
Sheila Wells, CIC, CISR
Rehoboth Beach, DE
J. Marshall Wolff, CIC, CPCU Easton, PA
NATIONAL DIRECTORS Richard M. Rankin Chairman of the Board
Michael P. Ertel Sr. (PIA) Columbia, MD G. Greg Gunn, CIC (IIABA) Lemoyne, PA Diane Hornung Hanby (IIABA) Wilmington, DE
2
MAY 2022
DON'S DISCUSSION
DON'S DISCUSSION IA&B Legal & Corporate Affairs Director Don Bankus
Are you a member with a question? Contact Don to find the answer at 800-998-9644, ext. 603 or DonB@IABforME.com.
QUESTION: Does the Americans with Disabilities Act apply to agency websites?
ANSWER: Several members recently reported receiving “demand letters” from an attorney claiming their agency’s website isn’t “ADA compliant.” In the letters, the attorney threatens litigation on behalf of his client unless the agency (a) makes the website ADA compliant and (b) pays the attorney “reasonable attorneys’ fees and costs.” So does the Americans with Disabilities Act (ADA) apply to agency websites? The issues of whether a website needs to be “ADA complaint” and/or what would constitute an “ADA compliant” website are not settled. Federal courts continue to evaluate and adjudicate ADA website compliance lawsuits on a case-by-case basis, with varying outcomes. In addition to lack of clarity in the courts, no federal governing or regulatory body has provided express and enforceable guidelines, rules, or regulations regarding what constitutes an “ADA compliant” website. THE ADA The ADA was initially drafted in 1986, a time which predates our perception and use of the modern internet, with
one of the ADA’s primary purposes being to eliminate impediments which keep disabled individuals from utilizing and enjoying businesses. This includes private entities such as insurance agencies, which are open to the public and provide goods and services to the public. Since the ADA’s ultimate enactment in 1990, society has undergone sea changes. With the integration and necessary daily utilization of computers, tablets, and smartphones, individuals now shop, learn, interact socially and professionally, and get their entertainment via the internet as much as, if not more than, they do face-to-face. It’s with this overarching societal change in mind that the concept of website ADA compliance was conceived and is evolving. ACCESSIBILITY GUIDELINES So how can you make your website “ADA compliant” if there are no definitive court opinions or guidelines to follow or comply with? While the U.S. Department of Justice (DOJ), which oversees enforcement of the ADA, was expected to establish rules in 2010 regarding how to develop an “ADA IABforME.com |
compliant” website, it never did so, nor is it expected to do so in the foreseeable future. Presently, the World Wide Web Consortium’s Web Content Accessibility Guidelines version 2.1 (WCAG 2.1) are the generally accepted principles. While the WCAG 2.1 guidelines aren’t official government rules, they have unofficially been adopted and are favored by the DOJ, the federal courts, and ADA accessibility advocates. PRACTICAL STEPS TO CONSIDER Whether or not you’ve been the recipient of a pre-litigation “demand letter” (or something akin thereto) or have been named as a defendant in an ADA website lawsuit, it may be pragmatic to add/incorporate an “accessibility tool” into your website as a proactive measure and risk management tool. Doing so could act as a deterrent to future letters or litigation, and it may assist with the resolution of any currently existing matter. In addition, if you’ve been the recipient of such a “demand letter” or a notice of a complaint Continued on page 8 3
BIG DOLLARS IN THOSE COLLARS: THE LATEST ON DOGS AND HOMEOWNERS’ INSURANCE By Kevin C. Amrhein, CIC, CBIA We have three cats and a betta fish. But the real star of our show is Bruce, our 16-year-old rat terrier who still gets around pretty doggone good.
😆
If this resembles the ensemble at your home, we are not alone. As evidenced below, America’s love of (and spending on) dogs and pets in general is growing by leaps and hounds. I could go on, but this is an article about insurance, so let’s do this: 4
A MASSIVE EXPOSURE ▲ The National Pet Owners Survey (found at americanpetproducts. org) says 70% of U.S. households owned a pet in 2020, up 3% since 2019 and consistent with annual growth since the survey began in 1988. ▲ Dogs rule. Approximately 70 million households have at least one dog. 45.3 million have at least MAY 2022
one cat. Placing a distant third are freshwater fish which can be found swimming in 11.3 million households. ▲ Americans spent almost $104 billion on pet expenditures in 2020. To illustrate the massive growth in this space, in 2017, pet expenditures accounted for $69.5 billion in spending.
COVERAGE CORNER ▲ An abundance of pet-related data and the survey are available at iii.org (Insurance Information Institute).
WHO’S A GOOD BOY? WHO’S A GOO.. HE’S GOT MY HAND First, the good news. The downward trend in the total number of liability claims resulting from a dog’s behavior (such as bites or falls) continued in 2020. Now for the bad news: the upward trend in the cost of such claims also continued in 2020. Between 2019 and 2020, the average cost per claim increased over 12% to $50,425 which should come as no surprise: the average cost has risen 162% since 2003.
THE INSURANCE SERVICES OFFICE (ISO) HOMEOWNERS’ POLICY Based on the most recent edition (HO 00 03 03 22), here are several factors regarding this policy’s take on pet-related claims:
SECTION I – PROPERTY COVERAGES ▲ Pets are on the list of Property Not Covered. Item b. of this section contains the following: “We do not cover … Animals, birds or fish.” Thus, there is no coverage for costs relating to the pet itself. ▲ There is no coverage should a pet cause damage to the dwelling or other structure on the “residence premises.” Section A(6)(g) specifically excludes damage caused by “Birds, rodents or insects” while Section A(6)(f) specifically excludes damage caused by “Animals owned or kept by an ‘insured.’” Whether damage is caused by your own curious canine or a pal’s pup that you’re putting up, the exclusion applies.
▲ While the policy does not specifically exclude personal property damaged by a pet, keep in mind that many HO policies only cover personal property if damaged by a Covered Peril. For example, furniture damaged due to a pet’s chewing or scratching would not be covered.
SECTION II – LIABILITY COVERAGES As you may expect, many insurers use various underwriting guidelines for the purpose of restricting liability for pet-related claims. For the purposes of this article, assume that the policy is not affected by any such guidelines: ▲ There is no exclusion for BI or PD solely because it was caused by a pet. However, as evidenced below, other policy exclusions may apply to claims involving pets. ▲ Due to language contained in the “business” exclusion, BI or PD caused to a “home-sharing occupant” is excluded. For example, if you make a bedroom in your home available to rent through Airbnb, your HO policy will not cover BI or PD to the renter or renter’s property caused by the actions of your pet (or yourself). ▲ Unless caused by fire, smoke, or explosion, damage to property rented to, occupied, or used by or in the care of an “insured” is excluded. For example, if you travel with your pup and he chews on the wall of the Airbnb you rented, there’s no coverage. Some good news: Additional Coverage C - Damage To Property Of Others offers up to $5,000 per “occurrence” for PD to property IABforME.com |
of others caused by an “insured.” Thus, should your pet damage your rented digs while traveling, this giveback would apply. This amount may be increased by endorsement. Note that there are limitations to this giveback. For example, it doesn’t apply if the PD is to property owned by a “homesharing occupant.” Continued on page 9
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5
NEWS & NOTES
SEEKING NOMINATIONS FOR 2022 IA&B YOUNG AGENT AWARDS Are you a rising star in our industry or do you know someone who is? You can nominate yourself or another young agent to receive this honor. IA&B will recognize three rising stars in the independent insurance community in Pennsylvania, Maryland, and Delaware. Recipients receive: ▲ Featured on the October 2022 IA&B Primary Agent magazine cover ▲ Featured in a video on the IA&B website and social media ▲ And more! Award criteria includes: ▲ Employed by an IA&B Member Agency for one year or more ▲ 40 years old or younger ▲ Made community contributions through volunteering or service ▲ Example of becoming an up-and coming leader in the field ▲ Participated in IA&B events, education, or other happenings Nominate yourself or someone else by June 16. Learn more at IABforME.com/Agent-Award. Questions? Contact IA&B Public Relations Director Karen Robison at KarenR@IABforME.com or 800-998-9644, ext. 606.
>>> PA ACCIDENT SURCHARGE CAP TO CHANGE The Pennsylvania Insurance Department will increase the accident surcharge dollar threshold to $1,900 as of July 1, 2022. Auto insurers may not penalize policyholders whose aggregate claim cost over a threeyear period does not exceed the cap. The threshold was last adjusted effective July 1, 2020 when it was increased to $1,800. 6
October 2021 (top) and October 2020 (bottom) Primary Agent magazine covers featuring the respective award recipients.
APPLY FOR IA&B EDUCATION SCHOLARSHIPS Apply by August 12, 2022 for the next round of insurance education scholarships. This fall IA&B will award two individuals with full CIC and CISR designation scholarships, as well as member agencies with scholarships for their staff to attend CIC, CISR, CPIA, and CE courses. Scholarships to attend licensing study courses are available throughout the year. Access an application at IABforME.com/IAB-educationscholarships. Questions? Contact IA&B Administrative Assistant Sarah Jacoby at SarahJ@IABforME.com or 800-998-9644, ext. 104.
MAY 2022
Feed Your Success
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EMC Insurance Companies | Des Moines, IA | 800-447-2295 ©Copyright Employers Mutual Casualty Company 2022. All rights reserved.
7
NEWS & NOTES
UPDATE ON WORKERS’ COMP MARKET ACCESS An important change occurred to IA&B members’ workers’ compensation market access. As of April 9, 2022, IA&B discontinued its partnership with Agency Resources (ARI). Members’ sub-producer status through IA&B’s relationship with ARI ended on the same date. IA&B now offers workers’ compensation market access through Independent Market Solutions (IMS). IA&B members can access IMS at no charge and with no direct appointment, and they will receive competitive commissions and participate in any earned contingencies. While members no longer will be able to place new or renewal business with ARI through the IA&B partnership, they can deal directly with ARI. For service on the existing book and/or renewal business, contact Matt Garvie at 973-315-0707. For new business inquiries, contact Maryellen Mazzo at 973-315-0716.
VERIFY YOUR ADDRESS WITH PA DEPARTMENT If you hold a license in Pennsylvania – resident or nonresident, individual or agency – ensure your current address is on file with state regulators. Over the winter, the Department began its electronic license-renewal process – sending a courtesy renewal reminder to the business email on file approximately 90 days prior to license expiration. 8
The PID reached out to IA&B and asked that we remind licensees that, by law, they are required to notify the Department within 30 days of a change of mailing or email address. Licensees can update their contact information through Sircon or NIPR. (If a licensee does not have a business email address, they may provide a personal email address in its place.)
RLI PUP PROGRAM UPDATE As of April 1, the RLI Personal Umbrella Policy (PUP) program is paperless. Sub agents through IA&B’s partnership with RLI have access to all policy information and documentation through the online RLI portal. In addition, when a policy change occurs, they now receive an email notification with a portal link to access additional details and documentation. To access the portal – or for answers to frequently asked questions about the RLI PUP program – please visit IABforME.com/market-access-foryour-customers. Note that RLI will continue to mail legally required documents, such as those related to non-renewals, cancellations, and new policies. For assistance accessing the RLI portal, please contact IA&B Professional Lines Account Manager Cheryl Shiffer, CPCU, CISR Elite at CherylS@IABforME.com or 800-998-9644, ext. 203.
MAY 2022
DON
Continued from page 3 filing, or if you have been served with an actual complaint, you are strongly encouraged to contact your attorney. ADDITIONAL INFORMATION For a list of “accessibility tool” vendors, additional educational resources, or contact information for an attorney versed on this issue, contact Don Bankus, IA&B’s Corporate Affairs Director, at 800-998-9644, ext. 603. 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
IA&B RELOCATES HEADQUARTERS IA&B relocated its Mechanicsburg, PA headquarters over the winter. Following the sale of the IA&B building in January, the Board of Directors approved the lease of new office space nearby. Please update our new address in your records: 650 Wilson Lane, Suite 200 Mechanicsburg, PA 17055 The organization also leases an office in Annapolis, MD.
COVERAGE Continued from page 5
A FEW TAKEAWAYS FOR THE AGENT ▲ Agents should suspect a pet exposure exists in almost every personal residential account in the agency’s book. ▲ Cite the significant increases in both pet expenditures and claims as a reason to review property and liability limits as well as the need for excess/umbrella coverage. ▲ Review insurer-specific underwriting guidelines which would adversely affect coverage contained within the policy form as reviewed in this article. ▲ For pet owners most likely to take their pets with them to other places, such as friends’ homes, public locations, or traveling, discuss the $5,000 liability giveback for PD and option to increase by endorsement. That’s all for now. Until the next round…. Cheers! Kevin C Amrhein, CIC, CBIA is IA&B's education consultant. He works with our CISR and CIC programs, as well as our special topic seminars and live webinars. Catch him at one of our upcoming professional training offerings: IABforME. com/education
Thank You
Thanks to these partners for supporting the independent agent network. PLATINUM PARTNERS Acuity Erie Insurance Millers Mutual Insurance Penn National Insurance Plymouth Rock Assurance
BECOME A PARTNER TODAY Interested in becoming a partner? Reach out today. Tim Wonder, IA&B VP-Membership 800-998-9644, ext. 351 TimW@IABforME.com IABforME.com |
9
ON THE COVER
Q&A with
CANDI SHOUPE
Candi Shoupe is COO / Partner of CBM Insurance, a full-service independent agency in New Castle, DE. She also serves on the IA&B Board of Directors. Q. Tell us about your career path. What triggered your interest in the insurance industry, and what led you to an independent agency?
Q. The last two years have been a wild ride for employers. From management to agency operations, what lessons have you learned?
A. I started working part time at a small, independent insurance agency during my freshman year of college. Due to a family hardship, I was not able to return to school my sophomore year. At that point I had the insurance “bug” and began my full-time career in insurance.
A. The past two years have been an incredible challenge for so many reasons. In March 2020 when I sent our staff home with laptops, I very naively told them it would be for two weeks. Two years later, we are still learning lessons of this changed world.
Over the years I held many positions in the agency, from Personal Lines CSR to Commercial Lines CSR to Agency Claims Manager. Then I spent nine years managing a wholesale agency underwriting surplus lines policies. In 2008, I decided to give the company side a try and accepted a position with Main Street America Group.
At CBM we invest a lot of time in our agency culture. We always tell our employees that family comes first, and we try every day to live by these words. At no time has this been more important than during the struggles of the past two years.
One of my first agency appointments with MSA Group was a start-up operation, Clark Baffone & Matthews (now CBM Insurance). I met with Brandon Baffone & Drue Matthews and was inspired by their agency vision. I left MSA Group to join Brandon and Drue and manage their new agency in May 2009. Drue decided to leave the insurance industry in 2015 to pursue a calling to pastor a church. Shortly after that, Brandon put a plan in motion to have me join him as a partner in the agency. It has been an amazing adventure working with Brandon to build CBM Insurance. 10
MAY 2022
We had just purchased a small personal lines agency on March 1, 2020 and were in the process of acquiring IFS Insurance on Dec. 31, 2020. Onboarding two agencies during the pandemic, while trying to maintain our agency culture, took an enormous amount of planning. Keeping the lines of communication open is so important to make sure that everyone has the tools they need to be successful. Half our staff is working hybrid/remote with no plans to change in the near future. Our employees love the flexibility, and our agency service levels have all increased.
Q. Your background is in commercial lines. What advice would you give to new producers just getting their start in the industry? A. I think learning to read a policy and understanding policy forms is so important. It always amazes me how many insurance agents have never read a policy form. Taking the time to really understand what you are selling and the limitations of coverage will prevent many errors. The other thing I really stress is getting to know your company underwriters. In this day of technology and email, it’s easy to forget that insurance is a people business. Take the time to form a relationship with your underwriters. That relationship could mean the difference in getting a deal across the finish line. Q. What do you consider your biggest professional accomplishment, and why? A. My biggest professional accomplishment is working with Brandon Baffone and being his partner in CBM Insurance. Growing CBM Insurance from a small start-up to one of the leading agencies in Delaware in 13 years is incredible. I am so thankful for the many blessing that we have had along the way. We have a great team at CBM!
who are close, and I hope to stick around to see them complete this honor. Our troop recently chartered a girls’ unit, and I am looking forward to seeing these young women embrace the many advantages that scouting offers. Q. When this issue of Primary Agent magazine arrives, summer will be right around the corner. What plans do you have? A. This summer will be very busy for our family. My husband and I have four children. Our youngest son will graduate high school in June and is preparing to attend California University of Pennsylvania in August. Our oldest son is purchasing his first home and has a few projects we will be helping him with this summer. Our middle son lives in Montana with his wife. They just had our first grandchild, a little boy. We are planning a family road trip to Montana this summer to visit them and see Yellowstone and Mount Rushmore along the way. We will finish out with our daughter getting married in September. I love to kayak, so among all of our adventures, I am hoping to find time to get my boat in the water as much as possible.
Q. What are the independent agency system’s biggest challenges? And how do you think we can overcome them? A. We are living in the world of instant gratification. Everyone is becoming accustomed to going online and ordering whatever they want to have it delivered to their doorstep. We are seeing more customers take this same approach with insurance. Our challenge is to make sure our clients understand the benefits of working with an independent agent and how valuable that service is to their insurance program. Q. We understand you’re a long-time volunteer with Boy Scouts of America. Tell us about your involvement! A. My youngest son joined scouting in 2013, and I signed up to help. Since then, I have held several positions: Den Leader, Assistant Scoutmaster, Treasurer, Merit Badge Counselor, and currently Committee Chair for his troop. I really believe in the scouting experience and the leadership opportunities it provides for our youth. During my time with Troop 239, we have had five boys, including my son, earn their Eagle Scout. We have two more boys
IABforME.com |
Candi is active with her agency, community, and family, but she enjoys finding time to kayak. 11
Retention and Hiring Tips to
T HR IVE
in the Talent Shortage
By Karen H. DiGioia Herbein | Mosteller HR Solutions 12
MAY 2022
TALENT SHORTAGE Back in the early ‘60s, Pete Seeger wrote the modern folk song “Where Have All the Flowers Gone?” A 2022 refresh of this song might find the lyrics changed to “Where Have All the Employees Gone?” While, from a public health perspective, we are moving steadily back to “normal,” this is far from the truth on the job front. The lingering effects of COVID on the workforce, in combination with other factors, finds employers struggling to attract and retain talent. Record high “quit rate” of over 4 million a month. Unemployment rate of 3.8% – lower than pre-pandemic levels. Decreased labor participation rates. 24% increase in entrepreneurial activity. Delayed turnover from employees who largely stayed in place in 2020 and much of 2021. Retiring (and early retiring) baby boomers. Pandemic epiphanies. Continuing childcare challenges. These and many other factors are coming together to create a “perfect storm” that is likely to be with us for quite some time. Layer on top of this economic and wage inflation. In late 2021, Herbein | Mosteller HR Solutions conducted our first Salary Budget Survey. Responses confirmed what we already knew: Merit increase budgets are on the rise, and many organizations are layering additional market adjustments on top. Bottom line – to attract and retain talent, many organizations are investing (yes, I said “investing”) more in pay. My word choice here is deliberate. When it comes to employees, too often we use the word “expense.” While it may seem like a matter of semantics, it’s an important distinction. If you need to upgrade your technology, you invest in new hardware and software. If you’re trying to reach a new market, you invest in marketing. But when it comes to your most critical resource – your human capital – we talk about expense rather than investment. Let’s change that thinking. If you don’t make the investment in your employees to ensure that you have a solid foundation of competitive and equitable compensation, all those other investments will be worthless. That powerful new software or marketing campaign will have no value if you don’t have the human capital you need to maximize those investments and bring a return. Other than ensuring that you have a foundation of competitive and equitable compensation, what else should your agency be doing to ensure that you are positioned to thrive in 2022? IABforME.com |
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Focus on Retention Bringing in new employees is challenging, timeconsuming, and costly. Now, more than ever, agencies should focus on retaining the talent they have. To look at how to retain employees, let’s start by discussing why employees leave. While many employees who resign say that they are leaving for a job with higher pay and better benefits, the real question is “Why did they go looking for another job in the first place?” Frequently, their decision had nothing to do with pay and benefits. Let’s explore some of the real reasons employees leave and what we can do to ensure that they stay.
#1: Build Strong Managers There’s an old saying out there that goes something like this: “Employees don’t leave companies, they leave managers.” Managers are the main point of contact with employees. According to Gallup, if employees are engaged by a leader that they trust, it can take a pay increase of more than 20% to entice them to leave. Strong managers communicate. They lead. They inspire. They develop. They recognize and play to the strengths of each employee. They retain. Unfortunately, few managers are ever trained in how to do these things well. Many were strong operational and tactical employees that, at some point, found themselves in a management role and expected (magically?), overnight, to know how to manage. In addition to investing in a foundation of competitive compensation, agencies should invest in upskilling their managers. Supervisory and management training are critical to ensuring that managers, new and experienced, know how to communicate, lead, inspire, develop, and retain employees.
#2: Communicate, Communicate, Communicate (and When You’re Done, Communicate Some More) We’ve often heard that “safety is job one.” When it comes to your employees (as with all relationships), communication is job one! A strong relationship is reliant upon strong two-way communications, and this includes the relationship between employees and employers. Listen: Gather feedback. Whatever format is right for your agency – one-on-one conversations, focus groups, employee engagement surveys, stay and exit interviews – you need to be listening to employees. As Epictetus, a Greek philosopher from the first century AD, was credited with saying, “We have two ears and one mouth so that we can listen twice as much as we speak.” Make sure your agency is creating regular (and safe) opportunities for employees to speak and that you are listening with both ears! Speak: While it’s critical to listen, it’s equally important to speak. Leaders and managers need to proactively communicate with employees about expectations and then provide regular feedback regarding performance. Communication should also encompass the bigger picture. Your agency may be good at communicating information to employees – enrollment dates, deadlines, new policies, meeting schedules. But what about the bigger picture? Make sure that you’re clearly communicating the agency’s mission, values, and goals. Ensure that employees understand how they fit into the agency and know that they are valued.
#3: Invest in Employee Development and Training To whatever degree you can, make sure you are creating opportunities for employees to learn and grow. By developing your current talent, you’ll improve retention and better position the agency to promote from within when the need arises.
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MAY 2022
TALENT SHORTAGE
#4: Commit to the Health and Well-Being of Employees The past two years have been rough. Recognize that stress and burn-out are rampant, and that, as an employer, it’s appropriate to help. The tactics you can use run the gamut from formal programs like EAPs that provide support for employees struggling with stress, to less formal approaches. Employer-sponsored desk yoga. After work (voluntary) employee gatherings and happy hour. Employer-sanctioned “mental health” days. Bottom line: Provide ways for employees to connect and de-stress.
#5: Build a Healthy Culture We hear a lot about creating and nurturing a healthy work culture but may not spend a lot of time defining what a healthy culture is. A healthy culture is one where employees are trusted, safe, respected, and valued. Their opinions and input are sought out, considered, and appreciated. In a healthy environment, employees feel safe to speak up when they see a problem and feel comfortable “being themselves” at work. People operate with integrity. Look around: Do those statements fit your agency? If your answer is “no,” you’ve got some challenging, but worthwhile, work ahead of you. As the saying goes, “the longest journey begins with a single step.” Start today. Make a commitment to meaningful change, identify your challenges, and take it from there – one step at a time.
#6: Embrace Flexibility In a recent article, McKinsey and Company reported on research that found that parents were more likely to have recently left their job than nonparents. The reasons largely had to do with work/life balance challenges. Organizations that are open to flexibility are better positioned to attract and retain employees who are struggling to maintain this balance. Flexibility can take many forms (and they don’t apply only to parents): Schedule – Is full time work a requirement or is part-time an option? Is there flexibility regarding when work can be done? Can you accommodate periodic shifts in schedule or hours so an employee can get their child to dance class, IABforME.com |
baseball practice, or a doctor’s appointment? The more flexible you can be as an employer, the better you position yourself to retain (and attract) employees. Location – Is remote work an option? This can be a permanent arrangement or on an “as needed” basis. Employers that require all employees to show up all the time are at a disadvantage when it comes to attracting and retaining employees. Another form of flexibility may apply to later-career employees. Those nearing retirement may be interested in “repurposement” rather than retirement. Rather than going from 100% to 0% overnight, can workers remain “on the job” in a way that provides them with greater flexibility, but keeps them involved with the agency? This could be a win-win option that keeps these experienced employees a part of the agency for a longer period and allows for a more gradual transition.
Maximize Your Ability to Attract Regardless how strong your employee retention, at times, you’re going to need to bring in new talent. It’s critical to recognize that it’s a candidate’s market right now. Those applicants that you’re seeking to attract have many options in front of them. The more you look at the recruitment process as a “courtship” (be on your best manners, dress your best, bring flowers, you get the idea), the more successful you’ll be. Make sure that your hiring process is “candidate-centric.” If it’s not efficient and easy, your candidates are likely to go somewhere else. Ensure that you’re casting a wide net for candidates. If you’ve embraced remote work, take full advantage from a recruiting perspective. Also, make certain your job requirements are focusing on things that are truly required for the role. Narrowly defined educational and experienced requirements can eliminate candidates that may have acquired the competencies required for the job via a less traditional path. Hopefully, this article has provided you with some “food for thought.” But how do you know where to start? Most agencies can’t (and shouldn’t) do it all. Continued on page 21 15
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E&O PREVENTION
6 COMMON CAUSES OF AGENTS’ E&O CLAIMS By Tabitha L. DeGirolano, RPLU, Utica National Insurance Group Why do insurance agents receive errors and omissions (E&O) claims? Often it is for failing to execute basic transactions that take place many times each day in your agency. The following are some of the most common reasons that agents experience E&O claims:
1. FAILURE TO PLACE/RENEW COVERAGE For a variety of reasons, an account can “fall through the cracks,” leading to coverage not being bound. Often
this is only discovered once a client submits a claim and realizes there is not coverage in place. Alternatively, coverage may be bound, but not at the terms expected.
2. CERTIFICATES OF INSURANCE May claims begin with a mistake made on a certificate of insurance. This can be the result of listing incorrect limits, including additional insureds that are not covered under the policy, or confirming coverage when the policy has been cancelled. IABforME.com |
3. FAILURE TO OBTAIN/MAINTAIN PROPER COVERAGE For P&C agents, this is the most common source of E&O claims. When a client doesn’t receive the coverage they requested or expected, they look to the agent for relief. A lack of a thorough risk analysis is often the root cause of these problems. For renewals, failure to recognize and communicate coverage changes can result in a coverage gap for your client. Continued on page 19 17
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T H E
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Contact Tim Wonder, VP - Membership TimW@IABforME.com • 800-998-9644, ext. 351
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©2022 Church Mutual Insurance Company, S.I. CM Regent Insurance Company is a wholly-owned subsidiary of Church Mutual Holding Company, Inc. This material may include only a general description of insurance coverages and does not include all rates, terms, conditions, and limitations found in CM Regent Insurance Company (“CM Regent”) policies. The insurance policy, not any general descriptions of coverage that may be found in this material, will form the contract between the insured and CM Regent, and is subject to approval from the state. Neither CM Regent nor its employees, representatives, or agents shall be liable to any party for the use of any information or statements made or contained herein. NAIC # 12356 *Elevator inspections are currently available only for PA customers.
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MAY 2022
E&O CLAIMS Continued from page 17
4. FAILURE TO GIVE ACCURATE INFORMATION/ADVICE When an agent is not effectively communicating the product they are selling, a client may believe that they were not provided with adequate information to make an informed decision on coverage. This can be of particular concern when an agent works with a wholesaler on a product they lack expertise in. Limit recommendations can be a pitfall for agents when a client finds out they do not have sufficient coverage for a claim.
5. FAILURE TO NOTIFY OF CANCELLATION/REPLACE COVERAGE When agents set the precedent of notifying clients of pending cancellations, failure to do so can result in a claim when a client has a loss after the cancellation. Failing to offer to assist the client in replacing the cancelled coverage can be another area of exposure.
6. REPORTING OF CLIENT CLAIMS Claims that are reported to the agent, but not forwarded to the carrier in a timely manner can result in a denial of coverage. Additionally, an agent may not report the claim under all policies that could respond. This is often an issue when excess or umbrella coverage is in place. An agent may advice a client that “they will be covered” or “there is not coverage” rather than instructing the client to submit the claim to the carrier for coverage determination.
Many claims can be successfully defended with good, uniform procedures and thorough documentation. Instituting appropriate loss control measures can help agents avoid claims while better servicing their clients. Tabitha L. DeGirolano, RPLU, authored this article. She is E&O Risk Management Specialist and Executive Commercial Lines Underwriter with Utica National Insurance Group. This information is provided solely as an insurance risk management tool. Utica Mutual Insurance Company and the other member insurance companies of the Utica National Insurance Group (“Utica National”) are not providing legal advice, medical advice, or any other professional services. Utica National shall have no liability to any person or entity with respect to any loss or damages alleged to have been caused, directly or indirectly, by the use of the information provided. You are encouraged to consult an attorney or other professional for advice on these issues. © 2021 Utica Mutual Insurance Company
SHOPPING YOUR E&O? Take full advantage of your membership by allowing IA&B to look into insurance programs that could provide you better value and protection. As an IA&B member, you have more options. Get started today by contacting IA&B Insurance Placement Specialist David Wertz, CPIA. 800-998-9644, ext. 506 DavidW@IABforME.com
LEADER OF THE Steve Burnett, CIC, ARM, a long-time contributor, shares what drives his support. “Now more than ever we, as independent agents, have no choice but to be actively and aggressively involved in the legislative process for the preservation of our agencies and our industry. Agree or not, contributions to elected officials are the most effective way to gain their ear when we need them to listen. There is a rising tsunami of legislation currently being discussed, presented, and voted on in Dover that will impact all of us, employers and employees alike, now and well into the future. A contribution to AgentPAC ensures that we will have a seat at the table and will be heard when those issues that are important to us arise.” AgentPAC is IA&B’s state-based, bipartisan political action committee which supports the election of candidates and legislators who understand the issues important to the independent agent and broker community. Support of these candidates who are critical to IA&B’s government affairs work would not be possible without AgentPAC contributions from engaged IA&B member agents. Join the effort and learn more about AgentPAC by visiting IABforME.com/ political_advocacy. 19
PICS & POSTS
PICS & POSTS
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MAY 2022
TALENT
Continued from page 15 Listen to your employees. Look at why they stay and why they leave. To whatever degree you can, take a “custom” approach to recruitment and retention. Each employee has unique needs. Meet your employees and applicants where they are. Don’t assume. Ask. Listen. And, when possible, accommodate. The pandemic was a reset for employers and employees alike. The uncertainty of 2020 put many employees in a “holding pattern.” Now, employees are reevaluating their work experience – and reflecting on what’s working and what’s not, and they’re more than prepared to make a change. The good news is that there are many things that agencies can do to impact their ability to retain and recruit. Organizations open to introspection and change will gain competitive advantage in attracting and retaining the talent required to thrive in the postpandemic era. Karen H. DiGioia provided this article on behalf of Herbein | Mosteller HR Solutions, IA&B’s contracted human resources consulting firm. As part of your IA&B membership, expert advice is just a phone call or email away. Have an employeerelated challenge that you’re not sure how to handle? Contact Karen at 610-779-3870 or khdigioia@herbein.com.
IABforME.com |
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STAFF PROFILE
Get to Know … Susan Zvorsky, CISR Elite, CPIA
Years with IA&B: My start date was July 8, 1985 – nearly 37 years ago – with Professional Insurance Agents of Pennsylvania, Maryland, and Delaware (a precursor to IA&B). To put this in insurance perspective, I was hired to help the Education Department launch a new training series when the CGL changed from an occurrence to claims-made policy! Ancient news, I know.
Role at IA&B:
Member of IA&B Education Team
I feel fortunate to have worn many hats with PIA and IA&B. I started as a ‘road warrior,’ traveling as a staff assistant for education courses and helping with the annual three-week basic insurance school that we once conducted. In the ‘90s, I moved to the member services area and worked on membership recruitment, retention, and our services programs, such as E&O, along with the annual convention. Having my insurance license paved the way to working with insurance sales next. And, like a boomerang, I am back in the Education Department, but rather than traveling these days, I work on our licensing and CE filings.
Best part of your job: The people, by far! IA&B has the best volunteers, members, and co-workers you could ask for. There are too many to mention, but few have impacted my life as much as the late Dr. G. William Glendenning, who was our education consultant, CIC consultant, and head of the three-week basic school. Many, many insurance professionals – myself included – benefited from his tutelage.
Favorite IA&B memory: Working with the 3-week basic insurance schools underwritten by the Mutual Insurance Education Foundation (MIEF) brings back great memories. It was incredible to see the transformation of hesitant novices to confident professionals after spending 3 full weeks living and learning together. I’m always delighted to chat with past students who are now well into their insurance careers and many are agency principals!
Favorite vacation spot: My family has enjoyed our treks to Topsail Island, NC since my three children – now all in college – were infants. The pristine beaches, warm water, and turtle nests make this a very special family vacation spot.
You can reach Sue at: 800-998-9644, ext. 206 SueZ@IABforME.com IABforME.com |
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SAVE TIME & MONEY
Shopping Your E&O? As an IA&B Member, you could qualify for a program that provides better value and protection. Benefit from IA&B’s:
GET THE MOST OUT OF YOUR MEMBERSHIP. TAKE ADVANTAGE OF THESE BENEFITS.
▲ Relationships with reputable carriers ▲ Industry leading claims service ▲ Highly trained, licensed professionals
▲ Legal and Compliance ▲ Access Markets & Carrier Relations ▲ HR and Hiring Solutions ▲ Marketing, Branding, and Websites ▲ Insurance for your Agency ▲ Online CE & Education ▲ Industry News ▲ Advocacy & Government Affairs
Get Started Today David Wertz, CPIA Insurance Placement Specialist 800-998-9644, ext. 506 DavidW@IABforME.com IABforME.online/insurance
Q U E S T I O N S?
CONTACT TIM WONDER, IA&B VP-MEMBERSHIP 800-998-9644, EXT. 351 TIMW@IABFORME.COM
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We distinguish our Workers’ Compensation coverage by providing value-added services before, during, and after a claim. Upfront loss control measures Responsive claims handling Facilitation of quality medical care (when an accident does occur) We’ve been successfully protecting our policyholders and their employees since 1983. Browse all of our products at www.guard.com.
APPLY TO BE AN AGENT: WWW.GUARD.COM/APPLY/ Our Workers’ Compensation policy is available nationwide except in monopolistic states: ND, OH, WA, and WY.
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MAY 2022
EARN CE WITH IA&B
WELCOME NEW PARTNER SECURA Insurance For information about becoming a partner, contact:
Tim Wonder, VP-Membership 800-998-9644, ext. 351 TimW@IABforME.com
PRIMARY AGENT Editor: Karen Robison KarenR@IABforME.com 800-998-9644, ext. 606 Contributing editors: Jennifer Ross Megan Fioretta Sarah Jacoby Sales Account Executive: Laura Gaenzle laura.gaenzle@theygsgroup.com 717-430-2351
E D U C AT I O N SCHEDULE M AY 2 0 2 2 Register today! 800-998-9644, option 1 IABforME.com/education LIVE WEBINARS DATE TOPIC
TIME
May 4
CISR - Elements of Risk Management
8AM-3:45PM
May 4
Hour w/ Corey: Liars - How to Spot Fraud
2-3 PM
May 5
Commercial Property - Direct vs Indirect Damage
1-4 PM
May 10
Personal Lines Coverage Concerns
9 AM-12 PM
May 10
Employment Practices Liability
1-4 PM
May 11
William T. Hold - Personal Lines
8AM -4PM
May 12
Agent’s E&O: Defenses & Preventions
9 AM-12 PM
May 12
Leadership and Liability: Insuring Executive Risk
1-4 PM
May 17-18 CIC - Agency Management Institute
8AM -5PM
May 17
Lurking: Surprises in the Contractor’s CGL Policy
9 AM-12 PM
May 17
Chris Amrhein’s “Medicare & Other Retirement Healthcare Solutions”
1-4 PM
May 18
CISR - Commercial Property
8AM-3:45PM
May 18
Hour w/ Cathy: Truly Awful CGL Endorsements
2-3 PM
May 19
Growing Good Insurance: Fortify Farm Risks
9 AM-12 PM
May 19
Personal Lines Clients & Their New Normal
1-4 PM
May 24
CPIA - Position for Success
8:30 AM - 4:30 PM
May 24
Certificates & Additional Insureds
9 AM-12 PM
May 24
The Evolution of Ethics in Insurance
1-4 PM
May 25
CISR - Commercial Casualty II
8AM-3:45PM
May 25
CPIA - Implement for Success
8:30 AM - 4:30 PM
May 25
Hour w/ Nicole: Homeowners Loss Settlement Issues
2-3 PM
May 26
CPIA - Sustain Success
8:30 AM - 4:30 PM
May 26
Commercial Insurance Coverages, Court Cases & Chaos 1-4 PM
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