IN THIS ISSUE MARCH 2018 - VOL 14 ISSUE 3
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10 Incredibly Useful Online Sites You Didn’t Know About Until Now Lawyer Accused of Insurance Fraud Scheme Entitled To Defense Special Report: Primary Flood The New Hot Product Among Insurers
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NY Takes Action To Deter Fraud & Manipulation in Crypto Currency Markets
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South Georgia Insurance Agent Arrested on Fraud Charges
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Shocking Allegations From Former U.N. Official
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Georgia DUO Arrested In Smartphone Insurance Scheme
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Oil Change Scam Exposed Investigative Team Take Hidden Cameras to the Scene
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Unbelievable Vintage Ads - Another In Our Series Of Ads From The 30s, 40s, 50s & 60s.
Barry Zalma Releases Insurance Education Books on Amazon U.S. Supreme Court Rejects Mercury’s Latest Attack on CA’s Proposition 103
Washington State Insurance Agent Accused of Stealing 30K+ In Premiums
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The Advisor Examines Gift Cards - The Gift That Keeps on Giving to the Issuer
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Owner of Numerous Miami-Area Home Health Agencies Sentenced to 20 Years in Prison for Role in $66M Fraud
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Are You Moving From San Francisco?
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Afraid of A.I.? On Tech Columnist Says, “Nothing to Worry About!”
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Black History Month Skips a Lot of Black History...
How (And Why) To Write A Press Release
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Primary Flood The New Hot Product!
G
uest contributor Guy
Georgia’s Only Virtual Insurance Agents Organization “Insuring the American Dream”
Waters is co-owner of Clearwater Underwriters, Inc of Clearwater, FL. He began his career as a retail agent i n 1978. Clearwater Underwriters was established in 1991 and is Coverholder to several Lloyds programs including Commercial, Residential Property and Liability. Guy brings us this month’s report on Primary Flood.
Kim Komando Barry Zalma
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MARCH 2018 INSURANCE - POLITICS - TECHNOLOGY - PEOPLE A Publication of AdMax Corp., Inc. Corporate Offices P.O. Box 31551 Palm Beach Gardens, Florida 33420 Ron Manera, Publisher/Senior Editor Join Me On Linkedin: HERE Follow Me On Instagram: @rmanera 561.718.0745 • ron@insurmedia.com
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MARCH 2018
TECHNOLOGY
10 INCREDIBLY USEFUL ONLINE SITES YOU DIDN’T KNOW ABOUT UNTIL NOW Really Cool Tech Info - by Kim Komando
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f you had to guess, how many movie is available on Netflix, iTunes, different websites do you Amazon, Hulu, YouTube, HBO Now, Who knew that browsing online think exist in the world today? CW, Starz, Showtime, PlayStation, movies could be so arduous? Actually, From simple blogs to complex finding which streaming service businesses, the internet spans the best suits your channel and gamut dispensing and gathering programming needs is in itself a myriad of information. Keep very confusing. Click here for a your answer in your head streaming chart that lets you because, at the very end of this see exactly what channels are article, I’ll tell you the closest available per service. estimate we have. The site JustWatch sifts through Luckily, all kinds of websites offer almost every streaming service free ways to perform simple yet out there to find a specific title essential tasks. These websites or show you what’s new on can tell you what’s streaming, a particular service. In just a clean up your email, fix your few clicks, JustWatch will tell grammar, edit your photos, and you where to find it, whether test your router, and most of it’s available on a subscription them require only one or two service, and how much it costs steps. to rent or buy. Since platforms like Netflix vary around the Here are some lesser-known sites world, you can also search by you’ll use time and time again. country for available content. Click here to check out this streaming service’s search site 1. A search site just for or another streaming service? Most for yourself. streaming movies and programs importantly, if it’s free on Netflix or You want to watch a movie. What’s HBO Now, then there is no need to the easiest way to find out if that pay to rent it on iTunes or Amazon. See Kim Komando Pg 38 MARCH 2018
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CLAIMS & THE LAW
LAWYER ACCUSED OF INSURANCE FRAUD SCHEME ENTITLED TO DEFENSE Expert Analysis & Commentary by Barry Zalma, Esq., CFE Accusation that Lawyer Took
and ABC Insurance Company, 1-10, Civil Action No. 2:17-CVKickbacks from Auto Liability 5470-SDW-CLW, United States Claims Not Enough to Defeat Claim For Defense District Court For The District Of New Jersey (February 7, 2018) the nsurance companies, chafing USDC was asked to determine from multiple millions paid out in insurance fraud Join Barry Zalma’s Blog: schemes are fighting back by http://www.zalma.com/blog suing the lawyers – among others – involved in the scheme. New Jersey lawyer Karim Arzadi was named as a defendant in one whether Arzadi and his law of those schemes and sought defense from his errors and firm were entitled to defense or omissions (legal malpractice) indemnity. insurer. His insurer refused to BACKGROUND defend and he sued.
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arising from his practice, Arzadi secured a Professional Insurance Liability Policy Number LA808257 (the “Policy”) from Defendant Evanston Insurance Company (“Defendant” or “Evanston”).
On or about January 3, 2017, Plaintiffs Arzadi and Joworisak & Associates, LLC were named as party-defendants in Allstate of New Jersey, et al., v. Bandy, et al., Docket No.: OCN-L-19-17 (“Allstate suit”). Plaintiffs are alleged to have “engaged in a continuing fraudulent scheme that is designed to defraud the Allstate Karim Arzadi (“Arzadi”), is an Plaintiffs . . . by inducing the In Karim Arzadi, Joworisak & attorney licensed to practice in the payment of PIP [personal injury Associates, LLC, f/k/a Arzadi, State of New Jersey who maintains protection] healthcare benefits . . Joworisak & Associates and an office in Perth Amboy, New . pursuant to an unlawful practice Law Offices Of Karim Arzadi v. Jersey. To cover potential liability . . . .” Evanston Insurance Company,
Barry Zalma, Esq., CFE, practiced law in California for more than 43 years as an insurance coverage and claims handling lawyer. He now limits his practice to service as an insurance consultant and expert witness specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He founded Zalma Insurance Consultants in 2001 and serves as its only consultant. 6
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MARCH 2018
The lawyers sued Evanston in the Superior Court of New Jersey, seeking a declaratory judgment that Evanston has a duty to defend or indemnify Plaintiffs in the Allstate suit. On June 30, 2017, for the first time, Evanston’s counsel issued a letter to Plaintiffs disclaiming coverage in the Allstate suit because Plaintiffs are alleged to have engaged in fraudulent conduct which “does not fall under the Policy’s definition of Professional Legal Services,” and because “the Claim is not made against them in their insured capacity.” Later, defendant removed the case to the USDC.
policy is resolved in favor of the reporting requirement under insured. the Policy by submitting a claim to Evanston on or about Duty to Defend March 9, 2017. Where the insurance policy states a duty to defend, the insurer is contractually obliged to provide the insured with a defense against all actions
Scope of Claim
Under the Policy, Defendant must defend Plaintiffs against claims alleging a “Wrongful Act arising out of Professional Legal Services.” The Policy defines Professional Legal Services as “services rendered by an Insured (1) as a lawyer . . . provided that such services are connected with and incidental to the Insured’s profession as a lawyer and are performed by or on behalf of the Named Insured or any covered by the insurance Predecessor Firm . . . .” policy. Thus, when a complaint is filed against the insured Plaintiffs are named as alleging a potentially covered defendants in eight of the claim, the insurer’s duty to sixteen counts in the Allstate defend is triggered. suit. The Allstate suit alleges, inter alia, that Plaintiffs The parties did not dispute violated Section 4(e) of the that the Policy is valid and New Jersey Insurance Fraud the allegations arising from Prevention Action, N.J. Stat. the Allstate suit were received Ann. § 17:33A-1, et seq. (“IFPA”), during the Policy Period. The USDC was satisfied that Plaintiffs complied with the See Zalma Page 36
The Policy contains a “prior knowledge” condition that precludes coverage if prior to the effective date of the Policy, May 23, 2016, Plaintiffs had knowledge of the Wrongful Act “which would lead a reasonable person in [Plaintiffs’] position to conclude that a Claim was likely.”
The parties filed Cross-Motions for Partial Summary Judgment on the duty to defend issue. DISCUSSION An insurance policy is a form of contract, and its interpretation is a question of law for the court. In the first instance, the court interprets the language of an insurance policy according to its plain and ordinary meaning. Any ambiguity in a term of the MARCH 2018
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SPECIAL REPORT - PRIMARY FLOOD
PRIMARY FLOOD THE NEW HOT PRODUCT AMONG INSURERS sustainable and actuarially adopted its first Flood Insurance sound including removal of long Rate Map (FIRM) will see rate rimary Flood has been standing subsidies. Roughly 20% increases, for Pre-Firm as high as an ever-growing topic of all NFIP policies are calculated 25% per year until they reach full risk rates. among insurers, Unlike the NFIP, CUI is lenders, and the community as a whole. Super storms offering full Replacement Premium increases effective April 1, 2018, comply with all Harvey, Irma, & Maria hitting Cost on building coverage and the requirements of BW-12 the US in 2017 caused a lot of discussion about FEMA contents, including secondary and the Homeowners Flood Insurance Affordability Act of and other private primary and tenant occupied residences. 2014 (HFIAA). Increases will flood insurance providers. FEMA has continued to Where the NFIP will only offer a be in four categories of PreFirm policies: non-primary increases premiums and max of $250k per building and residential properties, apply additional surcharges properties, to comply with the Biggert- $100k in contents, CUI can write business Severe Repetitive (SRL) Waters Flood Insurance up to $5M per risk.“ properties (which includes Reform Act requirements. cumulatively da.maged The Biggert-Waters Flood using subsidized rates and most of properties) and substantially Insurance Reform Act of 2012 these policies are Pre-Firm. Many damaged/substantially improved (BW-12) reauthorized the NFIP policyholders who own homes properties. to make the program more built before the community By Guy Waters
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See Primary Flood Page 20
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bout the author – Guy Waters is co-owner of Clearwater
Underwriters, Inc. He began his career as a retail agent in 1978. Clearwater Underwriters was established in 1991 and is Coverholder to several Lloyds programs including Commercial, Residential Property and Liability. Specialties also include Professional Liability. Also contributing to the article is Nate Gorham, Senior underwriter of Primary and Excess Flood. Also Melissa Waters, Primary and Excess Flood underwriter and coverholder liaison for various Lloyds Flood contracts.
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MARCH 2018
NEWS
MARCH 2018
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NEWS
NY TAKES ACTION TO DETER FRAUD AND MANIPULATION IN CRYPTO CURRENCY MARKETS
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inancial Services Superintendent Maria T. Vullo today announced that the New York State Department of Financial Services (DFS) has issued guidance reminding all virtual
DFS has approved six firms for virtual currency charters or licenses, while denying those applications that did not meet DFS’s standards. DFS has granted licenses to bitFlyer USA, Coinbase Inc., XRP II and Circle Internet Financial, and charters to Gemini Trust Company and itBit Trust Company.”
implement measures designed to effectively detect, prevent, and respond to fraud, attempted fraud, and similar wrongdoing. In addition, DFS reminded virtual currency companies that they must be especially vigilant against efforts at market manipulation.
consumers and to the safety and soundness of financial services institutions,” said Superintendent Vullo. “As the cryptocurrency markets continue to evolve, DFS is directing virtual currency companies to take the necessary steps to guard against fraud, and to be extra vigilant about “DFS took the lead in 2015 in manipulation. By these actions, regulating the virtual currency the market can evolve with strong market, and we continue to be regulatory supervision.” vigilant concerning risks in these markets. Market manipulation See NY Takes Action Page 31 presents serious risks, both to
Mr. Zalma recently published on Amazon.com with links at the Zalma Books site with the following volumes:
currency entities licensed by New York State, including those that hold a money transmitter license, that they are required to 10
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MARCH 2018
NEWS
S. GEORGIA INSURANCE AGENT ARRESTED ON FRAUD CHARGES
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tlanta, GA – Insurance Commissioner Ralph Hudgens announced today that a Pierce County insurance agent has been arrested for allegedly committing insurance fraud. Dana Larson Bowen, 52, of Blackshear, Ga., was charged on February 14th, 2018 with twenty‐eight counts of insurance fraud for allegedly misappropriating her customer’s insurance premium payments for personal use.
Evidence shows that on multiple occasions, Bowen failed to forward all the premium to the insurance company, leaving many of her clients without valid coverage, Hudgens added. Individuals victimized by Bowen operated various types of businesses in Bacon, Pierce, and Ware Counties.
Bowen was previously arrested in June of 2017 and charged with felony charge of possession of cocaine and a misdemeanor charge of possession of marijuana after police investigated a break-in at her insurance office. Police said they found baggies of cocaine and marijuana at her home.
The drug investigation led into the insurance investigation and the H u d g e n s ’ subsequent charges. Bowen also Legal Division made the news in June when her has taken lawyer, Kenneth Futch, was briefly e n f o r c e m e n t jailed after getting into a fistfight action to revoke with her estranged husband’s Bowen’s license lawyer during a child custody to transact dispute in a divorce action. “In over seven years any insurance as Georgia’s Insurance business in Hudgens’ Legal Division has Dana Larson Bowen, 52, From Pierce Commissioner, I’ve seen Georgia. taken enforcement action County Chamber of Commerce Newsletter this type of fraud many to revoke Bowen’s license to times,” Hudgens said. “The outcome Bowen, a licensed agent in Georgia transact any insurance business is always the same. Whenever agents since 1988, owns and operates in Georgia. Fraud Investigators are tempted to keep the premium Management South Agency, 3517 are asking anyone that purchased money, they should realize that US Highway 84, in Blackshear. insurance from Bowen and find sooner or later they’re going to get they do not have legitimate caught.” According to an April newsletter, coverage to contact the the Pierce County Chamber of Department’s Consumer Hotline State Fraud Investigators found that Commerce had claimed Ms. Bowen at 800‐656‐2298. between August 2016 and June as their president and describes 2017 Bowen accepted more than her as “a well-respected business Insurance fraud is a felony in $250,000 in premiums payments woman with a reputation for getting Georgia with a penalty of two to from her clients to obtain workers’ the job done.” She is no longer listed 10 years in prison and/or a fine of compensation, general liability, and as a board member. up to $10,000. commercial insurance coverage. 12
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MARCH 2018
NEWS
BARRY ZALMA RELEASES INSURANCE EDUCATION BOOKS ON AMAZON.COM Publications by 50+ Years Insurance Expert Inform Industry Professionals on Insurance Fraud
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ulver City, CA - After practicing insurance law for over five decades, Barry Zalma, Esq., CFE, an internationally recognized and award-winning insurance expert and author, is releasing multiple education books on Amazon.com. Designed to inform claims people, special investigation unit investigators, and insurance defense and coverage lawyers on insurance claims and insurance fraud, the publications leverage key insights and learnings from his 50+ years of practical experience as a claims person and insurance coverage attorney. Shared Zalma, “To be an insurance professional requires continuous learning. That’s the motivation behind my writing; I have felt a need to share my experiences to help claims personnel, SIU investigators and claims counsel learn how to properly and thoroughly investigate insurance claims and avoid accusations that they committed the tort of bad faith.”
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o view all publications that can be purchased through Amazon as Paperback and Kindle e-books, visit Zalma’s author page or zalma.com/zalma-books/. A selection of the insurance resources available include:
•
• • • • • •
Insurance Fraud & Weapons to Defeat Insurance Fraud, Volume 1 & Volume 2, including full text insurance fraud decisions from the courts of appeal The Compact Book on Adjusting Liability Claims, a handbook for the liability claims adjuster The Compact Book on Adjusting Property Claims, a basic manual for the first party property claims adjuster Ethics for the Insurance Professional, the necessity of ethical behavior in the insurance business Rescission of Insurance, what is needed to rescind an insurance policy, including full text appellate decisions regarding rescission The Insurance Examination Under Oath, covering who, when, where, why and how to take an examination under oath “Random Thoughts on Insurance Volume V: Digests from Barry Zalma’s Blog: ‘Zalma on Insurance'”
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ooks by Zalma are also available from the American Bar Association and the National Underwriter Company. In addition to his library of education books, Zalma has also released a series of novels and true crime stories on Amazon, including Heads I Win, Tails You Lose, a collection of more than 80 fictionalized stories based on fraudulent claims he investigated as counsel to multiple insurers.
blogs, white papers, webinars and education courses on a myriad of topics impacting insurance practitioners. Examples of this work include A huge proponent of insurance his blogs, Zalma on Insurance education, Zalma has also and Zalma’s Insurance 101 published numerous articles, and webinars on Illumeo.com. MARCH 2018
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The first features published digests of interesting appellate decisions relating to insurance coverage, insurance claims and insurance fraud, while the latter is a video blog featuring 1,024 See Zalma Releases Books Page 21 www/underwritersinsider.com
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NEWS
U.S. SUPREME COURT REJECTS MERCURY’S LATEST ATTACK ON CA’S PROPOSITION 103 Jones prevails against insurer’s final appeal challenging reasonable profits in rate setting
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consumer protections provided under Proposition 103. I pledge to continue to defend those important protections that have saved California consumers over $100 billion over the past 30 years."
ACRAMENTO, Calif. — The United States Supreme Court today declined to hear Mercury Insurance Company's appeal to overturn a February 2017 California Court of Appeal ruling that held Insurance Commissioner Dave Jones' 2013 order requiring the insurer to reduce its homeowner insurance rates by 5.4 percent did not infringe on the insurer's constitutional rights.
This case is the latest in a number of assaults by Mercury and other insurers to weaken the voterimposed limits on insurance rates in Proposition 103. In arguments the court of appeal referred to as "hocus pocus" and "smoke and mirrors", Mercury claimed it should be allowed to disregard the 30-year-old rate formula which provides insurers a fair rate-of-return. Instead of following the tried and true rate regulations, Mercury argued the insurer "After Mercury's should be allowed repeated assaults CA Insurance Commissioner to argue over how to on Proposition 103, Davey Jones calculate the fair rate we have prevailed once again in protecting of return in every case. consumers from excessive and unjustified insurance rates," said The court of appeal agreed with Insurance Commissioner Dave the commissioner, that Mercury Jones. "While we can declare was bound by the formula. victory in this case, insurers The court also agreed with the continue to try to undermine the commissioner that Mercury could
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seek a variance from the formula if Mercury established the rate would cause deep financial hardship, but Mercury did even not try to prove that the rate caused it any kind of hardship. Mercury also argued unsuccessfully to the court of appeal it had a constitutional right under the first amendment to charge ratepayers for brand advertising that only benefits shareholders, not ratepayers. After Mercury's petition challenging the February 2017 decision was denied by the California Supreme Court in May 2017, Mercury petitioned to the U.S. Supreme Court arguing that Commissioner Jones' ruling violated the company's Fifth and 14th Amendment rights. Mercury argued that the company had a right to determine its own profit with each rate filing proceeding versus using the commissioner's rate formula, which was approved by the California Supreme Court in 1994. The commissioner's original order that Mercury lower its homeowner rates by 5.4 percent in 2013, saved policyholders $11,745,102. MARCH 2018
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(800) 229-2009 ext 3 Mention code UWI sales@accuagency.com Request more info at http:/ /accu.agency/UWI www/underwritersinsider.com Table of Contents
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THE INSIDE TRACK - BREAKING NEWS Shocking Allegations From Former UN Official
A
Image Credit: Creative Commons
ndrew Macleod, former chief of operations at the U.N.’s Emergency Coordination Center in a dossier he shared with The Sun claiming that UN relief workers have raped more than 60,000 people and that there are 3,300
making the announcement behalf of Lloyd’s of London that our Israeli embassy would syndicates with a focus on be moved to Jerusalem. Allied Health Care and Social Services business. The facility will write professional and MarketScout general liability coverages Launches New MGA and target businesses such as home health care, ALLAS, February 20, medical staffing companies, 2018 – MarketScout, ambulance attendants, med the national electronic spas, surgical centers, and insurance exchange and nursing/therapist/surgical MGA incubator, announced practices. Michele Vincent, today the launch of another the lead underwriter for MGA; this one writing on
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pedophiles working for the agency. Further, Macleod asserted that there is an ongoing cover-up of sex assaults by UN workers and attempted whistleblowers have been fired. “We are looking at a problem on the scale of the Catholic Church — if not bigger,” Macleod said. Recently the Trump Administration has threatened to cut funding to the New York based organization after the body condemned the U.S. for 16
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MARCH 2018
THE INSIDE TRACK - BREAKING NEWS the MarketScout facility explained, “We have thoroughly researched the Allied Health Care market and believe we can provide underwriters with exceptionally profitable business originating from the thousands of agents that utilize the MarketScout Exchange.”
A
ite Group’s newest report, 2018 Small Commercial Insurance Carrier Performance: An Agent Survey, explores the few growth opportunities for property and casualty
Antibiotic May Increase Heart Risk
Image Credit: By UBeR (Own work) [GFDL (http://www.gnu.org/copyleft/fdl.html),
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ccording to U.S. Officials the antibiotic clarithromycin (brand name: Biaxin) seems to be related to long-term risk of coronary heart disease - although they have no reason why the medication should have this effect. The study tracked persons taking the antibiotic for two weeks and then followed for a year. There’s no clear explanation for how clarithromycin would increase heart disease patients’ risk of death, the FDA said in a news release. Persons currently using clarithromycin with a history or risk of coronary heart disease should consult their physician. MARCH 2018
Shoulda Gone For The Gold...
New Aite Agent Survey
carriers as well as the reasons small commercial insurance is worth pursuing. It also examines how carriers looking to expand their small commercial presence could help their cause by understanding what their agents want out of their relationships with carriers. The report also discusses the primary distribution option for small commercial P&C carriers, which is unlike that of other types of insurance. To request a press copy of this report or to speak with Jay Sarzen about this topic, please contact us at pr@aitegroup.com.
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E
lite athletes have believed for years that sex prior to competition can erode performance, but according to a story on www.popsci. com, “Studies that do exist at all suggest that sex doesn’t hurt—and could even help— sports performance. A 1968 study that compared men’s grip strength after abstinence and after sex found no correlation between the two. Over time, research became more complex. In a 1995 study, scientists tested men on a treadmill and measured their aerobic power, oxygen uptake, and
other aerobic factors both after they’d had sex and after they’d abstained. Sex didn’t make any difference in their performance.”
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17
NEWS
GEORGIA DUO ARRESTED IN SMARTPHONE INSURANCE SCHEME
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tlanta, GA ‐ Insurance claims and illegally obtained Commissioner Ralph approximately $331,021.30 in Hudgens said Fraud replacement merchandise. Investigators with his office arrested a Stewart County woman and Muscogee County teenager this morning on felony counts related to an insurance fraud scheme of more than $300,000. The suspects are accused of filing multiple fraudulent insurance claims with Asurion Jaylen Table and Rita Geddis McKay (left to right) Insurance Services for alleged damaged or undelivered “Many of the claims filed by these smartphones and tablets. individuals allege similar damage or mishaps to their wireless device,” Rita Geddis McKay, 48, of Richland, Hudgens said. “Asurion alerted us Ga., and a 17‐year‐old male, of that there appeared to be a pattern Columbus, Ga., are each charged of fraud with these with two counts of insurance fraud claims, and our investigation and two count of theft by receiving revealed that was indeed the case.” stolen property. State Fraud Investigators The investigation revealed that discovered that once the suspects' between January 2015 and accounts were activated with October 2017 both McKay and the Verizon, they would add fictitious teenager used multiple identities or non‐working iPhones and IPads to establish accounts with Verizon to the accounts, place insurance Wireless to steal and resale iPads on them with Asurion, then file and iPhones. Records from Asurion theft and damage claims on indicates, the duo combined to file the device. Asurion would ship 371 fraudulently a replacement device, but the
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perpetrators would claim the merchandise was never delivered or arrived damaged. None of the alleged damaged smartphones or tablets were returned as required. Investigators have determined suspects ultimately sold the merchandise on secondary markets. McKay is currently being held in the Stewart County Jail, and the 17‐year‐old male is in the Muscogee County Jail. Insurance fraud is a felony and carries a penalty of two to 10 years in prison or a fine of up to $10,000.
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MARCH 2018
WASHINGTON STATE INSURANCE PRODUCER ACCUSED OF STEALING $30K+ IN PREMIUMS
F
ormer insurance producer Matthew Gingerich, 37, of Centralia, Washington pleaded not guilty to first-degree theft in Lewis County Superior Court on Jan. 26. He is accused of misappropriating more than $30,000 in consumers’ premium payments. The court set a trial date of April 15.
(CIU). Kreidler revoked Gingerich’s insurance producer license in February 2016.
Gingerich was fired from employment with American Family Insurance after an audit revealed that he misappropriated The charges were filed after some customers’ Matthew Gingerich, 37 an investigation by Insurance premium payments Commissioner Mike Kreidler’s and concealed Criminal Investigations Unit them by placing holds on the MARCH 2018
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accounts so the customers would not receive notices that their policies were canceled for nonpayment. American Family was able to correct the policies of all but one affected consumer, whom they could not identify.
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SPECIAL REPORT - PRIMARY FLOOD Continued From Page 8
PRIMARY FLOOD THE NEW HOT PRODUCT The average annual premium rate increases for all other classes (Condominium and multifamily) are limited to 15% while individual premium rate increases for any individual policy is simultaneously limited to 18%. The average annual premium rate increase for Primary Residence of Pre-Firm policies will be at least 5%. The consumer is the unfortunate victim to these unexpected large rate increases at renewal. Luckily, private primary flood is now being accepted by lenders, and is the new hot product among insurers. The private marketplace is already undercutting FEMA rates for identical coverage. It was recently reported that the NFIP paid out between $8.5 and $9.5 billion dollars in flood insurance claims related to 2017 disasters. For the first 20
The Underwriter’s Insider
time last year, FEMA entered into a reinsurance agreement with 25 reinsurance companies, transferring over $1 Billion of their risk to the private market. This year, the deal calls for them to transfer up to $1.5 billion. With each big flood catastrophe, shortterm re-authorization of the NFIP, and growing NFIP debt, more and more interest grows in a private market for flood insurance.
CUI is highly competitive on these pre-firm properties and unlike the NFIP, is offering full Replacement Cost on building coverage and contents, including secondary and tenant occupied residences. Another advantage to CUI’s flood product is their maximum coverage limits. Where the NFIP will only offer a max of $250k per building and $100k in contents, CUI can write up to $5M per risk.
CUI can write a Pre-firm, “A” zone, primary or nonprimary residence. Example: Dwelling built in 1972, used as a rental property with $175,000 dwelling limits. NFIP quote - $3,168 for non-primary / After Irma, Floridians without flood Our quote - $1,940 insurance faced massive repair costs. for non-primary Private market flood insurance residence or $1,378 for primary makes sense because insurers residence. like Lloyds of London already understand the needs of Finally, CUI’s flood product is able consumers and the market to combine multi-location, multias a whole and can make the building risks onto one policy, necessary adjustments in their unlike the NFIP, which would have programs as needed. Clearwater to write separate policies. Broader Underwriters (CUI) is a Managing coverages, more competitive General Agent for Lloyds of premiums, and higher limits, London and is part of this private paired with the exceptional market solution. With over 25 service and flood expertise that years of experience in excess CUI is already known for, makes flood, they are now offering for a winning combination. It is a private flood product as an expected by mid-May on-line rating will be in place. alternative to the NFIP. Table of Contents
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Continued From Page 13
ZALMA RELEASES INSURANCE EDUCATION BOOKS ON AMAZON.COM short videos providing a complete insurance claims education in three to four minute increments. As a recognition to his achievements, Zalma received Claims Magazine/ACE Legend Award in 2016, honoring a lifetime of insurance education. About Barry Zalma Barry Zalma. Esq., CFE, Consultant, assists his clients to resolve any insurance problem faced by lawyers representing insurers, lawyers representing policyholders, insurance claims management, insurance claims personnel, and those they seek to serve. The experience and skill of Mr. Zalma as a consultant and expert witness can make the difference before a jury, other trier of fact, or mediator. Mr. Zalma has served the insurance industry for more than 50 years as a claims person and insurance coverage attorney. He has represented insurers, advised insurers on claims handling, interpreted coverages, written insurance policy wordings, and testified as an insurance coverage, insurance bad faith, insurance claims handling and insurance fraud expert on behalf of insurers and policy holders. He now limits his practice to consultation and acting as an expert witness. Visit www.zalma.com to learn more.
MARCH 2018
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OIL CHANGE SCAM! INVESTIGATIVE TEAM TAKES HIDDEN CAMERAS TO THE SCENE
SO GO TO THE DEALERSHIP WHERE THEY’RE HONEST? NOT!
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othing illustrates the changes in our national culture better than vintage ads from the Mad Men era or earlier - many of which would be considered over-the-top sexist, politically incorrect or just plain unbelievable today.
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s our country battles the largest opioid crisis in our history with 66,000+ deaths in 2017, (considerably more than all the lives lost in Vietnam), it is interesting to note that heroin, one of the most addictive and dangerious opioids, was once sold by Bayer as cheap cough syrup. As a side note, most people know where Coca Cola got its name. In 1886 Atlanta, when the now-famous drink was being created by a guy named Pemberton, one of the ingredients was extract of coca - the source of cocaine. In the early years, people were getting a little happy ingesting their Coke. It wasn’t until 1929, that the company finally figured out how to extract all the cocaine from the leaves before mixing into the stew.
SPECIAL REPORT
HOW (AND WHY) TO WRITE A PRESS RELEASE By Ron Manera, Senior Editor
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he most overlooked source of free promotion for small to medium-sized companies? Press Releases. Those little info blurbs that strengthen your brand and inform your market can be powerful tools if employed effectively. With a press release, your company can inform the world of a new hire, promotions, a key person retiring, a new product, a merger or acquisition, a new office or a thousand other events positive and timely. But even more important: Getting your company name out in front of tens of thousands of your prospects and customers, (even competitors) often, and at little or no cost. As an editor of a couple of insurance industry specific journals, I am on the receiving end of dozens of press releases daily - all wishing a free ride in one of my next issues. I welcome press releases because they often provide valuable content to my readers. Because of space and relevancy limitations, I can’t run them all. As a matter of fact, only a small percentage of the PRs I review make it into the magazines. How do I decide what to run? 24
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I look first for relevancy. Is the your entire PR. A good headline information in the press release will not only get my attention, something likely to be interesting but that of my readers if printed. or valuable to my subscribers? I 2. Don’t open with “ABC can discard 80% of the PRs I review Company announced today...” simply because the content is not because the PR may not appear focused on my audience. for another 30 days. Include the actual date. Next, I look for length, style and 3. Keep your copy succinct! 375format. Will the original PR take 450 words max. That’s an entire up two pages requiring radical page, so you have plenty of editing for size? Can I easily move room to cover your subject. the content into my publication I’m not going to give you more without extensive reformatting? space - so if you run long, you Are there bulleted paragraphs or are asking me to trim your copy multiple hyperlinks to contend and you may not like what I with? remove. 4. Learn to write like a journalist: I look for a news-style press Who, What, Where, When & release. When I receive a PR that is Why. (in no particular order) 80% promotional and 20% news, List those 5 categories out on I’m likely to pass it up. I don’t a worksheet and work from it charge for news - I do charge for as you script your PR. To the advertising. ultimate reader, it should not read as if it were written by your marketing department but as if Up The Odds Your Press we sent a reporter out to cover Release Will Be Printed your news story. 5. Important! Don’t make your PR into an advertisement. suspect most editors rely on First, it will lesson the chance I criteria much like mine when include your piece, (remember, reviewing incoming press I charge for advertising) but releases for publication. Here are just as important, it will lack eight tips to increase your odds of credibility to the readers if it actually making it to the show: just looks like a puff piece. It’s okay to sound enthused about 1. Give me a compelling the topic and your company, headline! Hint: Write your but the ideal PR will look as if headline last after you review
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Image Credit: Creative Commons
your company made the news because of some newsworthy event. 6. Give me at least one quote, e.g. “Frank’s extensive experience in restaurant risks will bring a new depth to our commercial insurance department,” said John Smith, CEO... 7. If appropriate, include an image, especially if the PR involves personnel or a mention or quote from a company officer. I often include company logos when they are made available. 8. About (Your Company) It’s good to include a short “About ABC Company” at the end of your PR. Keep it short and within the word limit for the MARCH 2018
entire piece. Include contact info for “further information.”
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ow that you’ve created the perfect press release, where should you send it?
While larger operations use paid services like Businesswire, PRweb, PRNewsire and others to distribute their press releases, smaller companies can maintain a list of media outlets that make more sense for their target market. I review PRs from the big distribution houses all the time but I am more likely to notice one emailed directly to me. In the insurance business, for example, include every trade Table of Contents
journal that covers your region. If you are introducing a new restaurant program, for example, you may wish to include some of the trade journals in that industry. If you are a local retail agent, by all means include local print media, especially neighborhood newsletters or city-wide newspapers. Build your list in a spreadsheet database so you can one-click mail-merge a personalized copy to each media outlet. Make it a habit! Find the best copywriter in your office and assign them the task of churning out one press release each month. You’ll be building your brand and status within your industry. www/underwritersinsider.com
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“The Final Authority on Everything!” WARNING!
The Advisor has been known to be politically incorrect and may send certain Millennials scurrying to their safe space. Also not recommended for Progressives who are easily offended. Please read at your own risk.
The Gift That Keeps on Giving - To the Issuer
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y husband and I run a small insurance agency with eight employees. As a portion of their Xmas bonus, we gave each one of them a $200 gift card to a local mall. I later overheard one of our employees telling another that gift cards are a bad deal and wished she would have been given cash instead. We thought they were a convenient and thoughtful gift. What say the Advisor? — T. B. Atlanta, GA
ADVISOR
restrictive and, generally, an aggravation to the recipient, limiting where and how the gift can be used. Financially, gift cards are the best thing to ever happen to a retailer. For the same reasons, they make little sense for the consumer.
seller to use the card. Worse, some cards sold by malls, banks or issuers of credit cards have “maintenance fees” which are applied to the balance monthly that can eventually eliminate the value of the cards.
A recent Consumer Reports study reported that 23.3 million Americans had yet to use the cards they received in 2016! Many were lost or forgotten, some were buried in wallets or purses and in many instances the holder had just failed to visit the store of the
Further, with some issuers, you are being charged a fee that can equal 15% to 20% of the value of the card — a card that costs the issuer pennies. That’s what your money would earn if you left it in a savings account for 3-4 years! Although gift card sales are
Thoughtful yes - but convenient for the giver only. Cash is more convenient to the recipient. A gift card is 26
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expected to reach $100 billion this year, it’s been reported that as much as $8 billion of gift cards goes unspent.
A Millenial Ponders Her Insurance Career
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’m a recent college grad and I work as a clerk in a small insurance agency and just passed my property and casualty state exam. The agency thinks I’m going to stay forever and be a CSR, but I would really like to do more with my license, maybe even open my own agency. What career factors should I consider? — I.O. Leesburg, FL MARCH 2018
You need to factor in quite a few variables including your own needs and abilities. Do you have the people skills to sell? Do you want to work outside or inside the offi ce? Will you have the business experience, funding, cash and insurance products necessary to open your own agency? Do you want to specialize in a particular line or category of insurance such as personal or commercial? Is your agent’s license the end of your education or are you going to work for that CPCU? What are your income expectations? Will you be content as the owner of a small personal lines agency or do you see yourself Table of Contents
as a principal in a regional insurance brokerage? Answer all these questions and it should provide some career direction.
Better Deal On Car in Stock?
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s it true I can get a better deal on a car a dealer has in stock vs one he has to order? J.L. Dallas, TX Of course. That dealer already owns the cars on his lot and is paying interest (floor plan) on each car in inventory monthly. Those are the cars he’s incentived to sell. You will get a better deal. www/underwritersinsider.com
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220/440 Lic. Ins Agent Needed - Boca
FREE CLASSIFIED RULES: Submit all ads online at: www.underwritersinsider. com/classifieds. Ads must be less than 501 characters plus a title line. Eligible free classifieds include help wanted, position wanted, personal ads, agency for sale/purchase, or the one-time sale of an item or items. Place Ad HERE! REGULAR CLASSIFIED RULES: Submit all ads online at: www.underwritersinsider. com/classifieds. Only $1.00 per word, including title line and response info. Payment must be received prior to print date. Ads run 3 mo.
Experienced Commercial 220 CSR Cape Coral/Fort Myers FL Established commercial lines agency seeking: self motivated, detail oriented professional. The successful candidate should have a minimum of 3 years experience in commercial lines, excellent computer skills, dependable, ability to follow up and follow through and have an unwavering commitment to the service your clients. Professional designations such as CIC, CPCU, CRM or ARM a plus. In return, you will have the opportunity to join a committed group of individuals in a growing, privately owned multi lines agency.Industry leading benefits and compensation package working with a group of experienced professionals low turnover environment. All Information and replies will be kept strictly confidential fairway34@hotmail.com 18-1
FREE CLASSIFIEDS! HELP WANTED — POSITION WANTED 4 — SALE ITEMS
CLICK HERE! 28
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440 or 220 in Boca Raton, Part Time or Full Time Experienced or Trainee; Agent and Customer Service Rep in family owned agency in Boca Raton. Full or Part time. (Flexible Hours) Personal Lines CSR; salary plus bonus. Commercial Agent; 50% commissions and residual. Most important Florida markets and several national markets available. We can compete with the “Big Boys” with our national affiliations. Email your resume to agencyops@gmail.com. or FAX to: 561-416-7221. EOE 17-2
Tampa Area Commercial Producer Agency Established 2006 seeks Outside Commercial Producer. Cutting Edge tech! Generous Comp and Possible Equity Buy In. Experience and FL 220 a must! Resume’ to info@nusurance.com 16-10
Agent/CSR wanted, Ft. Lauderdale Area
Independent P&C agency is seeking to employ a licensed agent and/or csr, with experience in nonstandard and standard auto, homeowners, commercial auto and property insurance. Fulltime position M-F 9am - 6pm and every other Saturday 9am - 3pm. Must have a GREAT attitude and know how to be a team player. Email resume to Marlinsii@aol.com. 17-11
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Looking for inside / outside lic. experienced sales rep. Must know QQ/QF, Semcat and other software packages. Efax resume to 561-829-2055. Great office. 16-11
Inside P&C Insurance Saleperson-NJ 1-3 years experience needed for a P&C Licensed saleperson. Leads, incentives and $40,000 base salary & benefits all provided in a convenient Parsippany modern location. jimb@mgainc.net 17-11
440 or 220 Needed in Tampa
Needed Agent or Customer service rep, must have knowledge of personal lines and have a great personality for established Family owned agency. Send resume. idcccorp@msn.com 17-10
Licensed P&C Sales & Service agent: Tampa, FL
We are seeking the right sales and service person to be a part of our team which is focused on continuing to grow a 24 year insurance Agency. If you are an experienced licensed professional who is proficient in sales of home, auto, flood, umbrella and other personal lines of insurance and who is also diligent in following up after the sale with quality customer service, we could be your professional home. info@danceferrentino.com 17-11 MARCH 2018
Looking to Buy Small To Medium Sized P&C Agency in Palm Beach County. Contact: morogers@aol.com
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Fresh out of School Insurance Sales Person Needed
We are doing a cooperative hiring with one of our carriers. Must be energetic, sales and commission motivated. It is a 2 yr salary with a transition to 100% commission, there is unlimited growth potential based on how good you are. Must be able to travel for 3 weeks of training to Philadelphia. Interview process is lengthy, but once we find the right person we are ready to go! larrytalbert@talbertservices.com 17-11
Help us to expand our Agency (From Home)!! We are seeking a super energetic and motivated professional to work in a virtual capacity assisting us with recruiting and supporting professional sales agents across the United States and Canada. For detailed information on our company and this non-sales virtual opportunity please contact me at: Nicole.lang@harvardbenefits.com
Experience Commercial CSR Wanted Duluth GA We are a mid sized agency, looking to add to our family environment insurance agency. We are not related but have a great time together. Voted Best in Gwinnett for 7 yrs in a row. Best in Duluth 2 yrs. Must be able to handle a large volume of direct bill accounts. Multicarrier experience and Hawksoft Agency use is a plus. Bilingual is also good but not a requirement.
larrytalbert@talbertservices.com 17-11
Looking to buy a P&C agency in PB county. Please call
BROWARD COUNTY ENTRY LEVEL ACCOUNT MANAGER Growing MGA is looking for a highly motivated & responsible individual. Duties include managing accounts from our distribution channel --- quoting, binding and servicing multiple lines of business. Incredible opportunity for someone looking to learn and grow in a company. Send resumes to info@ everiskpro.com 17-4
SUBMIT YOUR FREE CLASSIFIED AD HERE
561-584-0732
Efax: (561) 829-2055 17-3
Insurance Agent With 220 License We are looking for Insurance Agent with License 220 In Kissimmee, Florida Are Full Time on Agency. Please call 407-847-2539 for Interview Ask for Alex Ramos alexinsurance@aol.com 17-6
Nicole.lang@harvardbenefits. com
220-440 Agent for Port St. Lucie Agency (PT-FT ?) Please fax your information to: (772)879-1002 or e-mail to: amerinsur@aol.com Thank You... amerinsur@aol.com 17-11
16-12 MARCH 2018
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NEWS
OWNER OF NUMEROUS MIAMI-AREA HOME HEALTH AGENCIES SENTENCED TO 20 YEARS IN PRISON FOR ROLE IN $66 MILLION MEDICARE INSURANCE FRAUD
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he owner and operator of numerous Miami, Floridaarea home health agencies was sentenced to 240 months in prison today for his role in a $66 million conspiracy to defraud the Medicare program.
the owner and operator of more than 20 home health agencies. In many cases, however, Arias recruited nominee owners to falsely and fraudulently represent themselves as the agencies’ owners to hide his identity and ownership interest.
Rafael Arias, 52, of Miami, was sentenced by U.S. District Judge Cecilia M. Altonaga of the Southern District of Florida, who ordered Arias to pay $66.4 million in restitution and to forfeit the gross proceeds traced to the offense. Arias pleaded guilty on Nov. 30, 2017, to one count of conspiracy to commit health care fraud and wire fraud.
medical clinic and co-owned two home health agencies, pleaded guilty in November 2017 to one count of conspiracy to commit health care fraud and wire fraud and was sentenced to 180 months in prison. Mursuli Caballero, a patient recruiter and owner of two home health agencies, pleaded guilty in October 2017 to one count of conspiracy to commit health care fraud and wire fraud and was sentenced to 115 months in prison. Cabrera, who participated in laundering and concealing the proceeds from the fraud, pleaded guilty in November 2017 to one count of conspiracy to commit money laundering and was sentenced to 71 months in prison.
Arias and his co-conspirators paid illegal bribes and kickbacks to patient recruiters to refer patients to these agencies, and submitted false and fraudulent home health care claims to Medicare for beneficiaries who, in many cases, did not qualify or for whom the services were never provided. In addition, Arias provided checks to other individuals and entities “Arias assumed that in Medicare to cash so that Arias and his cofraud lay a path to riches,” said conspirators could obtain fraud Special Agent in Charge Richmond. proceeds to benefit themselves This case was investigated by “Instead he discovered that we are and further the fraudulent the FBI and was brought as part working tirelessly with our law scheme. of the Medicare Fraud Strike enforcement partners to protect Force, under the supervision patients and taxpayers while Arias was charged along with of the Criminal Division’s Fraud holding criminals accountable for Aylen Gonzalez, 39, of Hialeah, Section and the U.S. Attorney’s their unlawful actions.” Florida; Ana Gabriela Mursuli Office for the Southern District Caballero, 51, of Miami; and of Florida. Trial Attorneys Angela As part of his guilty plea, Arias Rafael Cabrera, 51, of Miami, in a Adams and Jessica Collins of the admitted that, between December July 2017 indictment. Gonzalez, Criminal Division’s Fraud Section 2007 and September 2015, he was a patient recruiter who owned a prosecuted the case. 30
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Continued From Page 10
NEW YORK TAKES ACTION AGAINST CRYPTO FRAUD In the guidance issued today, DFS directed virtual currency entities to adopt measures that include, at a minimum, effective implementation of a written policy that: • Identifies and assesses the full range of fraud-related and similar risk areas, including, as applicable, market manipulation; • Provides effective procedures and controls to protect against identified risks; • Allocates responsibility for monitoring risks; and • As part of its procedures and controls to protect against identified risks, virtual currency entity must provide for the effective investigation of fraud and other wrongdoing, whether suspected or actual, including, as applicable, market manipulation. MARCH 2018
• In addition, immediately upon discovering any wrongdoing, a virtual currency entity must submit to DFS a report stating all pertinent details known at the time of the report. Virtual currency entities must also submit to DFS, as soon as practicable, a further report or reports of any material developments relating to the originally reported events, along with: • A statement of the actions taken or proposed to be taken with respect to such developments, and • A statement of changes, if any, in the virtual currency entity’s operations that have been put in place or are planned in order to avoid repetition of similar events. • DFS has approved six firms for virtual currency charters or licenses, while denying those applications that did not meet DFS’s standards. DFS has granted licenses to bitFlyer USA, Coinbase Inc., XRP II and Circle Internet Financial, and charters to Gemini Trust Company and itBit Trust Company. • A copy of the guidance can be found here.
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NOTABLE QUOTABLES IN THE NEWS
SAY WHAT? Are You Moving From San Francisco?
to deal with it,” he continued. But it is not slippery. Do you think the United Kingdom is slippery for getting out of the European Union? Maybe you should call your whole country slippery.”
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ImageAttribution-ShareAlike 2.0 Generic (CC BY-SA 2.0)
loved it here when I first got here. I really loved it here. But it’s just not the same. We don’t like it here anymore. You know, we don’t like this sanctuary state status and just the politics here.” Carole Dabak, a retired engineer who lived in the Bay area for 40 years in an interview with San Francisco’s KPIX TV. She recently decided to move to Tennessee and out of the over-taxed, over-priced city, which is showing a mass out-migration. According to Mercury News, “Between July 2015 and July 2017, the region gained 44,732 immigrants but lost 44,102 residents to other parts of California and the country, according to the regional think tank. The population drops have been most notable on residents between the ages of 18 and 24, and between 45 and 64.”
Don’t Mess With John Bolton...
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ou are a munchkin in the media and you may have your opinions but I think your job is to present the news accurately and not editorialize. If you would like to tell me where the president behaved in a way that you disagree, let’s have an example of this and I’d be happy 32
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Afraid of A.I.?
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ach system is an idiot savant, with little ability to leap to problems it was not set up to solve.”
Tech columnist Brian Klutch writing for Popular Science attempting to dispell the common conviction that AI (artificial intelligence) will one day take over the world and enslave mankind. He speaks here of individual smart systems as idiot savants or remarkably focused intelligence that is dumb everywhere else and therefore little threat. Elon Musk and Stephen Hawking disagree, predicting a Terminator-like dystopian future if AI is allowed to run amuck. What do you think?
Condi Rice On Gun Gun Control
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et me tell you why I’m a defender of the Second Amendment. I was a little girl growing up in Birmingham, Alabama, in the late ’50s, early ’60s. There was no way that Bull Connor and the Birmingham police were going to protect you. I’m sure if Bull Connor had known where those guns were, he would have rounded them up. So I don’t favor some things like gun registration.”
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Former President George W. Bush’s top diplomat, Conoleezza Rice defending gun rights by offering a vivid personal recollection of how the government, in the form of anti-civilrights Bull Connor, was the threat. It’s important to understand that the 2nd Amendment was not Secretary Condi Rice put in place to provide for the ownership of weapons for the purpose of hunting. It was to defend the citizinry against a tyrannical government. Apart from the bizarre notion that educators should set aside one month to salute the historical achievements of one race apart from and above the historical achievements of other races, Black History Month appears to omit a lot of black history.
Black History Month Skips A Lot Of Black History...
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bout slavery, do our mostly left-wing educators teach that slavery was not unique to America and is as old as humankind? As economist and author Thomas Sowell says: “More whites were brought as slaves to North Africa than blacks brought as slaves to the United States or to the 13 colonies from which it was formed. White slaves were still being bought and sold in the Ottoman Empire, decades after blacks were freed in the United States.” Are students taught that “race-based preferences,” sometimes called “affirmative action,” were opposed by several civil rights leaders? While National Urban League Executive MARCH 2018
Director Whitney Young supported a type of “Marshall Plan” for a period of 10 years to make up for historical discrimination, his board of directors refused to endorse the plan. In rejecting it, the president of the Urban League in Pittsburgh said the public would ask, “What in blazes are these guys up to? They tell us for years that we must buy (nondiscrimination) and then they say, ‘It isn’t what we want.’” A member of the Urban League in New York objected to what he called “the heart of it -- the business of employing Negroes (because they are Negroes).” Bayard Rustin was one of Martin Luther King Jr.’s key lieutenants and helped to plan and organize the civil rights march in D.C. Larry Elder that culminated in King’s famous “I Have a Dream” speech. Rustin, an openly gay black man, also opposed race-based preferences.” African-American political pundit Larry Elder in a February column that opened with, “Apart from the bizarre notion that educators should set aside one month to salute the historical achievements of one race apart from and above the historical achievements of other races, Black History Month appears to omit a lot of black history.” Larry had the courage to put into words what many Americans have believed all along: That Black History month is far more about political pandering and advancing a liberal agenda of blame and victimhood then it ever was about teaching Black History.
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BACK ISSUES
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CLAIMS & THE LAW Continued From Page 7
ZALMA by participating in a “Kickback Scheme” while representing clients in personal injury matters. Defendant argues that these allegations “serve merely as contextual background for the actual claims at issue,” i.e. an insurance fraud conspiracy, which does not qualify as a professional legal service. The Allstate suit contained allegations that Arzadi advised clients how to proceed with their personal injury claims, which falls squarely within the Policy’s definition of Professional Legal Services. In determining whether particular acts constitute professional services, the important question is simply whether a substantial nexus exists between the context in which the acts complained of occurred and the professional services sought. There is clearly a substantial nexus between the representation and the professional services his clients sought. Indeed, if Arzadi had not been acting as an attorney, he would not have been able to commit the alleged fraudulent 36
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acts.
cannot be imputed to Plaintiffs. With respect to the second Interpreting the Policy lawsuit, that litigation was filed as according to its plain and a wrongful termination suit under ordinary meaning the language the Conscientious Employee is clear, the Policy provides that Protection Act (“CEPA”). Because it will cover any act as long as the underlying allegations were it is connected to the Insured’s connected to employment related profession as a lawyer. Providing claims, Plaintiffs conceivably may legal advice, as Arzadi is alleged not have had prior knowledge to have done, is certainly that those allegations were likely connected to his practice as to form a basis for the insurance a lawyer. Therefore, the Court fraud allegations contained in the found that the allegations Allstate suit. contained in the Allstate suit generally fall within the scope Defendant argued that under of a covered Claim under the Exclusion F (the Fraudulent Policy. “Prior Knowledge” Condition The Policy contains a “prior knowledge” condition that precludes coverage if prior to the effective date of the Policy, May 23, 2016, Plaintiffs had knowledge of the Wrongful Act “which would lead a reasonable person in [Plaintiffs’] position to conclude that a Claim was likely.” Defendant argues that Plaintiffs had prior knowledge of the conduct alleged in the Allstate suit based on two prior lawsuits; however, these arguments were not persuasive to the USDC. With respect to the first suit, Plaintiffs were not a party to that litigation. Thus, prior knowledge Table of Contents
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HERE MARCH 2018
CLAIMS & THE LAW Acts Exclusion), Plaintiffs are barred from coverage because the Allstate suit alleges that Plaintiffs “committed intentional, willful, dishonest and fraudulent acts.” While it is true that the Allstate suit contains fraud allegations, Exclusion F only bars coverage for fraudulent acts if a final judgment or adjudication is entered against Plaintiffs. The Allstate suit is in the preliminary stages of litigation and the underlying allegations have not been substantiated by any court. Therefore, Exclusion F does not bar Plaintiffs from coverage.
The court noted that Arzadi could not commit the fraudulent acts alleged by Allstate without giving legal advice as a lawyer. Since insurance requires fortuity, an accident, there should be no coverage for defense or indemnity of a series of intentional acts.
Indemnity
TEXAS INSURANCE AGENT SENTENCED TO LIFE FOR SCAMMING ELDERLY CLIENTS
Unlike the duty to defend, which arises whenever the claims asserted by the injured party potentially come within the coverage of the policy, the duty to indemnify is triggered only when the insured is determined to be liable for damages within the policy’s coverage. Because the Allstate suit is pending, this Court finds that it is premature to make a determination on the issue of whether indemnification applies. ZALMA OPINION
MARCH 2018
Fraud Unit found that Joseph Allen Gaines persuaded senior citizens in West Texas to purchase annuities, but then kept the money for himself.
TDI Sergeant S t e v e Richardson said Gaines been Evanston should defend under “had financial a reservation of rights and, if a advisor for Allstate proves its case, refuse to this woman’s indemnify and obtain a return family for Joseph Allen Gaines, 65 from Arzadi of the money spent d e c a d e s ” to defend him. If he didn’t commit and took advantage of her fraud there will be no need to trust. pay. Gaines came to the attention of TDI and the Lubbock Police Department when a 94-yearold woman’s family called an insurance company to confirm her $700,000 investment. They were told there was no policy in their mother’s name.
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Gaines was arrested for a second time on January 31, 2018 in the case of another elderly woman who lost $135,000 in a similar scheme.
former Lubbock insurance agent was sentenced Thursday to life in prison and ordered to pay back $810,000 to his victims after a Texas Department of Insurance (TDI) investigation.
TDI’s investigation also identified other victims of the scheme. Gaines was charged with felonies in Swisher, Wilbarger, and Howard counties. Several of Gaines victims testified at the Officers with the Texas sentencing in Swisher County. Department of Insurance Table of Contents
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TECHNOLOGY Continued From Page 5
KIM KOMANDO 2. Simple way to send large files privately and securely It’s bound to happen. You have a large file that you need to email. Your email program chokes on the file’s size and your service provider politely posts a message that says, “The file size exceeds the limit allowed.” Thanks. Send to the rescue. It lets you share files in a fast, safe and temporary way. Upload a file – up to a gigabyte, in almost any format – and Send will create a URL, which you send to the recipient. Once the file is downloaded somewhere else, it’s deleted from the internet, and it automatically vanishes after 24 hours. This, as well as Firefox’s respected encryption software, ensures that your file won’t fall into the hands of some hacker. You can also check and see whether the file was downloaded on the other end, so you don’t have to wait for the recipient to send confirmation. Click here for this file sending site you’ll want to bookmark now because the time will come when you need it. 3. Make sure hackers are not lurking in your router 38
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You’re using internet security software. You have secured your wireless network. You’ve enabled your network’s firewall. You’ve got complex passwords that contain an uppercase letter, a number, a sign, and the name of your 4thgrade teacher. All done, right?
stripped-down literary style, omitting any adjective and passive verb that wasn’t necessary.
Hemingway Editor is designed to mimic his minimalist prose. Copy and paste a few paragraphs into the site’s text box, and the editor will outline problematic parts One of the most overlooked such as long sentences, obscure vulnerabilities is your router. words, and confusing passages. Hackers can break into this device as easily as any other, a process For an all-encompassing grammar called “DNS hijacking,” and most checker, Grammarly has taken victims wouldn’t think to check homes and offices by storm. You whether it’s secure. can paste a document and have it checked at the Grammarly site. This site offers a free service that’s The app and browser extension specially designed to scan your works across programs and router for break-ins. You may be platforms, pointing out your split surprised how infinitives in emails, Here’s the easy and fast this word processors, diagnostic is; just answer to the websites, or on social click the “Check media. After all, using Your Router” number of websites bad grammar on icon, and you’ll in the world today. Facebook can create receive a neara tense situation. InternetLiveStats instantaneous has been tracking 5. For the tinkerers report. this data for many among us Click here to Apps, browsers, test your router years. There is a live devices, smart now for any ticker right on their gadgets – they all vulnerabilities. site. At the time of come in different forms, and they don’t 4. Write like your writing, that number all cooperate with English teacher was 1,331,525,090.” each other. We often wants you to struggle to hook up Ernest Hemingway was great at a one service to another, especially lot of things: hunting wild animals, when they were created by rival out-drinking his friends and developers. Sure, some adept writing very concise sentences. people can easily figure out in Hemingway was famous for his minutes how to tell their Amazon Table of Contents
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TECHNOLOGY Echo to start their Roomba vacuum and lock up the house. But then, there’s this gem for the rest of us. IFTTT is short for “if this then that,” and the site is designed to help different devices and services talk to each other. These so-called “recipes” can make your gadgets do things as in a chain of events. Want your smart lights to blink three times when you are tagged in a photo on Facebook? Or how about getting a notification on your phone when your favorite artist tweets about tickets to a concert? IFTTT can automate web-based tasks, and you can set up “triggers” and “applets” to set certain behaviors in motion. If you’re ready to take your tech to the next level, click here to learn more about creating your own recipes. 6. Powerful photo editor that doesn’t require a graphics degree Adobe’s Creative Cloud boasts some of the most sophisticated multimedia software on the planet. But not everybody wants to muddle through Photoshop, with its complex and suite and thousands of minute visual options. That’s probably why Adobe acquired Aviary, the simpleto-use site that can turn ordinary images into photographic masterpieces.
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Aviary has many familiar tools, such as the cool filters of Instagram and the corrective tools of Apple Photos. But Aviary has a particularly friendly interface and can be used both on your desktop and portable device. If you like to edit photos, you’re going to love this site. Click here and prepare to be amazed at what you can do with a photo in only a few clicks.
for a busy person to accumulate a few thousand emails. As I write this, I have 156 unread messages waiting for my attention.
8. Be the inbox envy of your friends
Using a secret URL, Sodadb gives you a template to build an online database, and you can manage
When you apply Clean Email to your inbox, you receive a detailed (but readable) report, with sophisticated data about your correspondence. You learn about the senders, your response rate, and which emails can be safely 7. A truly boring site that you’ll eliminated. Clean Email is free for the first thousand emails, and then tap into a lot there’s a monthly subscription fee. Many people struggle to convert You can also use it across multiple a Word document into a PDF. Or accounts. they have a WAV file that they need to condense into an MP3. Or you can do what I have done to What about a PNG that you want obtain zero inbox status. Simply in JPG form, an XLS to CSV, or delete all the inbox email and see EPUB to MOBI? who reaches out again because they will if it’s that important. Don’t sweat it. I’ve used this site for years. It is designed to handle 9. Get your stuff organized all sorts of file format conversions, from one type to another type and Whether it’s your baseball card back again. Simply upload your collection or bowling league file, decide the output format, and teammates, you’re keeping a click “Convert,” and the website will list of things. When it comes to do the rest. This is a real godsend technology, lists can be put into if you work with lots of different a program called a database. The individual items are called records. media. Once you enter the records into Click here for a functional site that a database, you can categorize, simply does what it says it will do identify, total, and sort all kinds of ways. and nothing more.
If you are failing at obtaining the zen-like “zero inbox” status, this site might help. It doesn’t take long Table of Contents
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TECHNOLOGY Continued From Page 39
printer frustration as well as wasted ink and paper.
KIM KOMANDO
Alternatively, you can use the browser extension CleanPrint. up to 10,000 individual records Technically, this is not a website for free. There’s no signup or but it works like a charm. Click subscription fee; you don’t even here for the download links for the have to sign into anything. major browsers. Sodadb (which stands for “Simple Online Database”) arranges your data and keeps it safe from hackers, using SSL security. You could use this online database for business, collectibles, sports teams, gifts – anything you like.
Here’s the answer to the number of websites in the world today. InternetLiveStats has been tracking this data for many years. There is a live ticker right on their site. At the time of writing, that number was 1,331,525,090. You can click here to see the most recent number of 10. Print online articles without websites around the world. all the ads You would think, after all these What questions do you have? Call decades, it would be easier to my national radio show and click print pages off the internet. But here to find it on your local radio printers and websites have never station. You can listen to the Kim been on good terms, and you Komando Show on your phone, never know what kind of garbled tablet or computer. From buying papers will scroll out of your advice to digital life issues, click here for my free podcasts. machine. Print Friendly takes the headache out of this process: Just paste a URL into the field and hit “Preview.” Print Friendly trims away a lot of the extraneous information and gives you the meat of the page, and you can review your document as a PDF before hitting “Print.” The service works better for some websites than for others, but it’s shockingly effective, especially for software that’s free.
Copyright 2018, WestStar Multimedia Entertainment. All rights reserved.
Learn about all the latest technology on the Kim Komando Show, the nation’s largest weekend radio talk show. Kim takes calls and dispenses advice on today’s digital lifestyle, from smartphones and tablets to online privacy and data hacks. For her daily tips, free newsletters and more, visit her website at Komando. Click here to save yourself from com 40
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Rent This Space! Want Your 1/3 Page Message To Hit Over 120,000 Industry E-Mails Per Month For As Little As $129.00? View Rate Card Here! Request More Info Here!
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BECOME A CERTIFIED EXPERT IN CORPORATE PROPERTY INSURANCE AND A CERTIFIED EXPERT IN CORPORATE LIABILITY INSURANCE Now available from Illumeo and Barry Zalma!
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veryone involved in insurance – either as an insurer or as an insured – requires excellence in claims handling. Businesses need to deal with insurers who have an excellence in claimshandling mandate. Insurers who wish to profit need an excellence in property and/or liability claims-handling program. Everyone in business needs an insurer who has an excellence in property or liability claims-handling program in effect. Two comprehensive programs enabling insurance professionals to become Certified Expert in Corporate Property Insurance and/ or Certified Experts in Corporate Liability Insurance are available from Illumeo.com and https://www.illumeo.com/curriculum/certifiedexpert-corporate-property-insurance and https://www.illumeo.com/ curriculum/certified-expert-corporate-liability-insurance. The programs are complete courses of study providing education and training to allow insurance professionals, after completing the individual classes, to become a Certified Expert. The programs cover everything an employee, an officer, or a director of a corporation needs to know about the need to acquire proper insurance and to resolve any claim presented by the corporation to the insurer. Major topics of study include, but are not limited to: the importance of insurance; how to acquire insurance and understand an insurance policy; the methods used by insurers to investigate claims; the various types of insurance that corporations need; the duties and obligations of a public adjuster; and how The full curriculum of the courses and other courses from Barry Zalma are available at http:// www.ilumeo.com by entering in the search bar the word “zalma.”
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Georgia’s Only Virtual Insurance Agents Organization “Insuring the American Dream” Join today at www.Georgia-Agents.com
Georgia Agents has more online benefits than any other insurance agents’ organization. Any one of the benefits shown on this page is worth more than the $99.00 per year membership! Join today at http://www.georgia-agents.com and everyone in your agency starts to enjoy the benefits immediately. You can pay online at www.Georgia-Agents.com or feel free to mail your business card with a check payable to: Georgia Agents c/o Eddie K. Emmett 200 Russell Court, Canton, GA 30115 Happy sales to you,
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Do GA CSRs have to be licensed? The answer is "Yes" if:
The CSR is a person who sells, solicits, or negotiates insurance.
The CSR receives commission on insurance sales.
The CSR handles endorsements and reinstatements.
The CSR gives quotes for insurance.
The CSR completes insurance applications.
The CSR handles renewals.
The CSR answers coverage questions.
So just what can an unlicensed CSR do? Mostly managerial and clerical tasks only indirectly related to the above tasks. I'm not so sure they can even take payments since that is a vital part of insurance sales.
The Georgia Department of Insurance encourages the insuring public to report any complaints about insurers, agencies and agents. The first thing checked is whether or not the person in the complaint is properly licensed for that transaction. Here's the scenario if the CSR is found to be in violation of O.C.G.A. § 33-23-4: Any person who willfully violates this Code section shall be guilty of a misdemeanor and, upon conviction thereof, shall be subject to punishment as provided in Code Section 17-10-3, relating to punishment for misdemeanors. Code Section 17-10-3: By a fine not to exceed $1,000.00 or by confinement in the county or other jail, county correctional institution, or such other places as counties may provide for maintenance of county inmates, for a total term not to exceed 12 months, or both.
Check out O.C.G.A. § 33-23-4 in the "Laws & Regs" link at the bottom right corner of www.GAlnsurance.org for a more murky explanation.
So what should an unlicensed CSR do? If they are handling only Personal Lines P&C, a Limited Subagent license should do the trick. The sponsor is responsible for their actions, a state exam is not required and they can take the required 20 hour pre-licensing course from the comfort of their desks for FREE if agency is a member of Georgia Agents.
It gets even better than that! CSRs may study the 20 hour Limited Subagent course, take an exam and download a Certificate of Achievement for free. It serves as great refresher training on Personal Lines such as auto, home and renter's insurance. But if the CSR handles lines other than Personal Lines, a full blown agent's license is required.
That applies to the CSR, the agency owner, and the Insurance companies that paid commissions to unlicensed entities. I wonder if they assign adjoining jail cells. GEORGIA AGENTS Members can earn 24 hours Online CE and 20 hours Limited Subagent Prelicensing and 20 hours Personal Lines Agent Prelicensing for all employees for only $99.00 per year! And that’s just a few of the many benefits. Join today at www.Georgia-Agents.com
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