2019 Fall Magazine by PIA of Tennessee

Fall 2019 • Tennessee

PAGE 16

PIATN’S 2019 ANNUAL CONVENTION Fellowship, education, networking and PIA family

INSIDE THIS ISSUE 9

ADA website compliance

Agency value proposition

Stay relevant in the digital age

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Departments 4 Fall 2019 • Tennessee

In brief

9 Legal 13 Service 25 Sales 27 E&O 30

Readers’ service and advertising index

Officers and directors directory

Cover story 16 PIATN’s 2019 Annual Convention Fellowship, education, networking and PIA family

Feature 21 You’ve got this Staying relevant in sales in the digital age

Statements of fact and opinion in PIA magazine are the responsibility of the authors alone and do not imply an opinion on the part of the officers or the members of the Professional Insurance Agents. Participation in PIA events, activities, and/or publications is available on a nondiscriminatory basis and does not reflect PIA endorsement of the products and/or services. CEO Mark LaLonde, CPIA, CIC, AAI; President Jeff Parmenter, CPCU, ARM; Executive Director Kelly K. Norris, CAE; Communications Director Katherine Morra; Senior Magazine Designer Sue Jacobsen; Member Information Manager Jaye Czupryna. Postmaster: Send address changes to: Professional Insurance Agents of Tennessee, 504 Autumn Springs Court, Suite A-3, Franklin, TN 37067. “Professional Insurance Agents” is published quarterly by PIA Management Services Inc. PIA Management Services, 25 Chamberlain St., P.O. Box 997, Glenmont, NY 12077-0997; (518) 434-3111 or toll-free (800) 424-4244; email pia@ pia.org. ©2019 Professional Insurance Agents. All rights reserved. No material within this publication may be reproduced—in whole or in part—without the express written consent of the publisher.

Cover design Zack Littrell

In brief

from the executive

Honors and awards As I write this article, we have just completed our 2019 PIA of Tennessee Convention and Trade Show at the incredible Embassy Suites in Murfreesboro. The convention was filled with fellowship, education, networking, and that “PIA Family” feel. Included in this issue are just a few of the pictures from the event. To see more, go to www.PIATN.com. We are excited about the event’s success, and already have begun planning for the 2020 convention. A major part of our annual convention is the recognition of leaders from our industry. We were proud to recognize the following individuals:

Agent of the Year–Tom Gernt with Gernt Insurance and The Insurance Group in East Tennessee. Tom has been a leader on our board of directors, served as Convention Chairman for several years as well as serves on other committees, and he was recognized as the 2018 Committee Chairman of the Year. Company Representative of the Year–Joe Clayton with Capital Premium Financing, a PIA Platinum Partner Company and Strategic Ally. Joe is an avid supporter of the PIA and the independent agent industry. He works closely with agents helping them finance premium for property/casualty accounts. Joe has been vital to the PIA of Tennessee and the growth of its non-dues revenue programs. Customer Service Representative of the Year– Janet Gibbs with Bush Insurance and Financial Services in Hermitage. Janet was recognized not only for her efforts within her agency, but also due to the behind-the-scenes efforts she has dedicated to PIA.

Young Insurance Professional of the Year–Ryan McKinney with John M. Green Insurance in Franklin. Recently, Ryan has been an incredible help in both planning the PIA convention, but also in the efforts to revive the Middle Tennessee Chapter and the Young Insurance Professionals group. Presidential Spirit Award–Greg Augustine with The Augustine Group in Clarksville. As a past member of our board of directors and former vice president, past chairman of the Legislative Affairs Committee, and PIA Advantages Services Board, Greg has been extensively involved in the PIA for many years. The highlight of the convention was the presentation of the Glen R. Page Distinguished Service Award to George Hilliard from Pete Mitchell and Associates in Memphis. George is probably most recognized for his feature in the PIA National promotion “I Am PIA!” As you are reading this article, the fall season is upon us. I would like to thank the members, partners and leaders of the PIA for all the assistance and contributions that made the convention so successful. We now turn our focus back to our members and helping them finish the year strongly. We are committed to bringing you resources and solutions. Let’s enjoy the cooler weather, admire the beautiful colors and race to the end of the year as many of us have our strongest quarters of the year. We look forward to seeing you in Muscle Shoals for next year’s convention on Aug. 29-30, 2020. More information will be available soon at PIATNconvention.com! If there is anything that we can do to assist you or your organization, contact us at (615) 771-1177. Always at your service,

Kristopher Mark Fisher, CAE, CPIA, LUTCF Executive Vice President & CEO

Professional Insurance Agents magazine

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BeyoncADA

legal

bradford j. lachut, esq. Director of government & industry affairs, PIA Management Services

Let’s talk about Beyoncé Giselle Knowles-Carter. Beyoncé. Queen Bey. Sasha Fierce. I don’t want to talk about her excellent 2016 album Lemonade, which I’m rocking out to right now. Nor do I want to talk about Homecoming, her Netflix special, which I can only assume (because Netflix does not release viewership data), has been watched by everyone on earth at least twice. I don’t even want to talk about her role as Nala in Disney’s remake of The Lion King.

• establishments serving food or drink;

No. I want to talk about Beyonce.com, Beyoncé’s official website. Recently, a Beyoncé fan sued the singer—or more specifically her website—alleging that the fan could not buy tickets to a Beyoncé show on the website because she was visually impaired and there was no way for her to navigate the site. To understand how a lawsuit against Beyoncé affects you, we need to go back in time—all the way to 1990.

• service establishments (insurance offices are mentioned specifically under this category);

The Americans with Disabilities Act was signed into law in 1990. The ADA prohibits discrimination against individuals with disabilities. The purpose of the law is to make sure that people with disabilities have the same rights and opportunities as everyone else. As you might imagine, many components of the law ensure that laudable goal is achieved. Some sections of the ADA are designed to help people with disabilities access the same employment opportunities and benefits available to people without disabilities. Others ensure that those with disabilities have the same access to state and local government services as those without disabilities. However, Title III of the ADA is the focus of this article.

Public accommodations Title III prohibits private places of public accommodation from discriminating against individuals with disabilities. In other words, under Title III, private businesses are required to make their facilities accessible to those with disabilities. The natural question: What exactly is a public accommodation? The ADA defines public accommodation as a private entity that owns, leases (or leases to), or operates a place of public accommodation.1 You might notice that the definition of public accommodation uses the words “public accommodation” in its definition. As a rule, this is extremely unhelpful. Fortunately, there is more guidance in the ADA Title III Technical Assistance Manual. That manual further defines public accommodation as a facility where operations affect commerce and fall within at least one of the 12 categories. Those categories include: • places of lodging; piaTN.COM

• places of exhibition or entertainment; • places of public gathering; • sales or rental establishments;

• public transportation terminals, depots or stations; • places of public display or collection; • places of recreation; • places of education; • social service center establishments; and • places of exercise or recreation.2 A facility cannot be considered a public accommodation if it does not fall under one of these categories, but good luck finding a business that doesn’t. So, how does Title III of the ADA relate to Beyoncé’s website? Because websites also are considered public accommodations under Title III, at least according to several federal appellate courts and the U.S. Department of Justice (usually a good authority when determining what the law is). While there is some disagreement among courts as to whether an online-only entity would be considered a public accommodation, the 9

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consensus seems to be that the prohibition on discrimination is not limited to tangible barriers, such as stairs or narrow bathroom stalls, which disabled persons face, but can extend to intangible barriers as well. Interesting side note on businesses that exist purely online—the Seventh Circuit in the case of Morgan v. Joint Administration Board, Retirement Plan of the Pillsbury Co., used insurance when rejecting the notion that a public accommodation is limited to a physical site. The court held that: “An insurance company can no more refuse to sell a policy to a disabled person over the Internet than a furniture store can refuse to sell furniture to a disabled person who enters the store.”3 All right, websites are public accommodations, but why do we care? Because it isn’t just Queen Bey who is being sued. By some estimates, ADA Title III website accessibility lawsuits increased by 177% in 2018—with more than 2,250 being filed.4

ADA compliance? The question then is, how can you prevent a lawsuit? In other words, how do you make your website ADA compliant? Unfortunately, there is not a clear answer to this question. There are clear standards for what tangible public accommodations must do to be compliant with the ADA, but the U.S. DOJ has yet to issue any guidelines for websites. In fact, the U.S. DOJ specifically has refused to issue any guidance on this topic. Where does that leave us? In the absence of guidance from the government, we can turn to accepted practices. On June 20, 2018, 103 members of the U.S. House of Representatives signed a letter sent to then-Attorney General Jeff Sessions requesting the U.S. DOJ take steps to set minimum web accessibility standards. That letter referenced the adoption of WCAG 2.0 guidelines. While the U.S. DOJ refused to adopt these guidelines, they are probably the best we have right now.

WCAG standards Web Content Accessibility Guidelines, or WCAG, are guidelines developed by the Accessibility Guidelines Working Group, which is part of the World Wide Web Consortium Web Accessibility Initiative. The W3C describes itself as an international community that develops open standards to ensure the long-term growth of the web.

Contact: Tom Gernt (615) 771-1177 Ext. 205 advantageservices@piatn.com

WWW.PIATN.COM

The WCAG are organized around four principles, which are necessary to ensure anyone can access and use a website. First, information and user interface components must be presentable to users in ways they can perceive. This would include having captions for any video or audio content on your website or having audio descriptions for any video content. It also could include making sure your website is viewable and operable in multiple display orientations (i.e., portrait vs. landscape). Second, websites also must be operable. Users must be able to operate the website interface and conversely the website interface cannot require interaction that a user cannot perform. This could mean that the website is operable through a keyboard interface instead of just through use of a mouse or that certain functions on your website do not time out. Professional Insurance Agents magazine

Third, the website must be understandable. Users must be able to understand the information as well as the operation of the user interface (e.g., having a mechanism available to identify specific definitions of words or phrases used in an unusual or restricted way; identifying the meaning of abbreviations; or identifying and describing errors input by the user). Finally, the website must be robust. The content must be robust enough that it can be interpreted reliably by a wide variety of users. This would include assistive technologies deployed by the user. For example, if a status message on your website conveys a suggestion, or a warning on the existence of an error, the warning must be readable or understandable to assistive technologies. This is by no means an exhaustive list, so look at the complete WCAG 2.1 standards (https://bit.ly/2xQy3SM).

PIA can help These requirements may seem like just another instance of the government telling businesses what to do. But remember, these requirements are not only designed to ensure that those with disabilities have the same access as everyone else—a noble goal in and of itself—but it can give you a competitive advantage by ensuring that your website and the services you offer are available to everyone. The Centers for Disease Control and Prevention estimate that 61 million Americans live with some sort of disability.5 And, the American Institutes for Research estimates that the total after-tax disposable income for working-age people with disabilities is about $490 billion.6 So, being compliant also can help your agency’s bottom line. Lachut is PIA Management Services’s director of government & industry affairs. 1

Americans with Disabilities Act Title III Regulations, 2017 (bit.ly/2Lm9C8r)

Americans with Disabilities Act ADA Title III Technical Assistance Manual (bit. ly/2Sjxvhr)

Morgan v. Joint Administration Board, Retirement Plan of the Pillsbury Co., 2001 (bit.ly/2xQ f6iU) 3

Seyfarth Shaw, 2019 (bit.ly/2DAmRvR)

Centers for Disease Control and Prevention, 2019 (bit.ly/2qAAM1f)

American Institutes for Research, 2018 (bit.ly/2q7bfKs)

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Uncover your agency’s value proposition In addition to a reliable prospect list, your agency’s value proposition is arguably the most vital element of your overall marketing messaging. A value proposition explains how your product solves customers’ problems or improves their situations. Let’s face it, it’s not always easy to differentiate in the insurance industry. From our work helping insurance agencies get sales appointments with their prospects, differentiating (on paper) has proven to be the most challenging piece of the sales process—but it is the most important first step toward an effective sales strategy. It’s easy for an insurance agent to be a quote shop, but in an effort to not become commodity-based, let’s explore how to uncover the value proposition to get the insurance buyer’s mind away from just thinking about the price of a policy. That is not to say that the cost shouldn’t be part of the prospects’

service

amanda puppo Owner, MarketReach Inc.

mindset, as saving money often is the first consideration. However, how you save them money is part of your value proposition. A solid value proposition demonstrates credibility and expertise while developing trust.

Five primary elements make up a strong value proposition statement. No. 1: It’s clear. Your value proposition should be easy to understand over a phone call and in written marketing collateral.

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No. 2: It’s thorough. It communicates concrete benefits, features and the results a customer will get from purchasing insurance policies from your agency. No. 3: It sets you apart. A value proposition should show how you’re different or better than your competitors. No. 4: It avoids the hype. Try to avoid statements like, “We can save you 30%,” and superlatives like, “We’re the best.” No. 5: It is concise. It should be understood (in about 20 seconds) to capture attention, until you have earned more time to be descriptive.

Why should a prospect buy from you? Think about what differentiates you in the marketplace. If you don’t tell prospects what makes you worth their attention and money, they won’t spend the time to figure it out on their own. Think about these questions: • Do you offer anything that other agencies don’t? • Do you have an online portal for clients to access policies, endorsements, claims, certificates, auto ID cards, etc.? • Is there something particular about your expertise from a consultative standpoint that allows you to uncover client advantages a good portion of the time? • Can you formulate benefits and features that relate specifically to a given industry? Your competitors may offer similar products, but if they’re not communicating it, consider it a differentiator. • How can your value propositions offer better statements than: We’ve been around for 30 years. or Our customer service is excellent.? You don’t have to be the best in every way. However, if you can show better value in at least one or two ways, you’re the best option for people who value that advantage you bring. Identify and promote what makes you different. For example, can you make the following statements (or something similar)? • “50% of our business is in high-risk trade. We understand your risks like no one else because it is a big part of our business. We can likely find gaps in coverage; offer you access to an exclusive program; or maybe even find that you’re overpaying in certain areas.” • “Risk audits at no charge. We’ll examine things like insurance contracts, policies and procedures, training programs, safety programs, conduct employee interviews and present our findings within two weeks.”

Support your value proposition Supplement the value proposition with factual evidence, case studies or stories to which prospects can relate. For example: A commercial glass company was feeling cash-flow pain from having to pay a large increase in its workers’ compensation premiums. It had never been advised on coverages by a broker who was well-versed in the line of

Professional Insurance Agents magazine

business. So, when we had the ability to review policy information a few months before the policy renewal, we realized it was being wrongly classified under construction codes. Once we coded the business properly and shopped it to a series of carriers, the company’s current broker was not able to match the quote— we were able to produce a policy quote that was 18% less than the incumbent’s quote—leading to $26,000 in savings, which of course, won us the account. In conclusion, consider your industry expertise to develop your value proposition. Attach numbers (e.g., what was a client’s premium prior to your consultation, and what was the premium after you reviewed the account?) Why were you able to do what the former broker could not do? Use storytelling to demonstrate problem-outcome-solution. Identify your value proposition and transform your agency. Puppo is the owner of 18-year-old New Jersey-based MarketReach Inc., which specializes in setting qualified sales meetings for insurance agencies and allied suppliers. In addition, MarketReach offers integrated marketing services to support a full sales pipeline such as LinkedIn Connection & Awareness program, monthly email newsletters and sales collateral. For more information, log on to MarketReachResults.com.

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Rating ■ Staff rating for agencies with 9 or fewer employees ■ Excess rated for agencies with 10+ employees or special acceptance categories ■ Refer to state rate pages

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Coverage features on a following-form basis ■ Full prior-acts coverage ■ Covers any person acting in a capacity as a real estate agent or notary. ■ Options unique to this program: ? Personal coverage — broadened and excess personal protection for owners, partners and officers, including members of their families. (Submit ACORD Personal Umbrella Application.) ? Employment practices liability — excess limits protection for liability incurred by named insured or employees for wrongful employment practices. Coverage can be written on a claims-made basis over a number of approved EPL carriers. Maximum available as a sub-limit is $2 million. (Submit a copy of underlying EPL application.)

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PIATN’s 2019 Annual Convention Fellowship, education, networking and PIA family

he 2019 Professional Insurance Agents of Tennessee Annual Convention and Trade Show was held June 18-21, at the Embassy Suites Murfreesboro.

This year, we brought in some of the most sought-after experts in the insurance industry, Jason Cass, of Insurance Agency Intelligence, Wessly Anderson, of Agency VA, and Keith A. Savino, CPIA, PIA National President. During the convention, our agents became informed on how to be “The Great Separator;” how to use virtual assistants; and how to create a better customer experience with data and technology.

We also had an excellent mock trial presented by Utica National—our premier E&O carrier. The trade show was well attended by both vendors and attendees. Fun was had by all who attended the “A Night in Monte Carlo Casino,” honoring our outgoing President Adam Cox, CPIA, and incoming President Dedric Pearson. We wrapped up with the PIA Herbert Montgomery Charity Golf Tournament supporting A Soldiers Child charity. Save the date for next year’s convention: Aug. 29-30, 2020. We will be at the Marriott Shoals Hotel & Spa in Florence, Alabama!

Professional Insurance Agents magazine

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Professional Insurance Agents magazine

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*subject to acceptable attendance; otherwise class subject to cancellation

jennifer torneden Business leader, Aon Programs

You’ve got this

Staying relevant in sales in the digital age

Seismic disruptions are rippling across the insurance industry. In first quarter 2019, over $1.4 billion was invested in InsurTech startup firms.1 What began as price comparison websites, called aggregators, has quickly grown to 310 InsurTech firms in the U.S.2 Experts are calling it a technology arms race.3 What do InsurTechs have in common? They have online raters and applications with no paperwork and little human interaction for consumers who want a more mobile experience. They are revolutionizing an industry that has not seen such digital enhancement in the past 100 years. Companies like Root—the first entirely mobile appbased U.S. auto insurer—use mobile-phone technology to set rates based on driving behavior. Hippo will give a consumer a homeowners rate in 60 seconds using just his or her address. For people who want to insure their smartphone during a week-long vacation to Hawaii, they can try Trōv.

Sensing they’ve either got to join the party or be left behind, carriers like AIG, USAA, ACE, Transamerica, AXA, MassMutual, Alliance and others have begun investing in InsurTech.4 The prevailing thought seems to be, adapt or become less relevant. Where does this leave the Main Street insurance agent? Carriers and consumers are always looking for ways to save money. To them, the agent’s commission may seem like an unnecessary expense. To many, it may seem like another maneuver to cut agents out of the equation.

The travel agent industry In 2000, there were 124,000 travel agents in the U.S. Enter Travelocity, Orbitz, Expedia, TripAdvisor and other online travel services. The number of travel agents dropped to 81,000 by 2016—a figure the U.S. Bureau of Labor Statistics predicts will drop to 72,000 by 2026.5 The travel agents who have survived have done so by enhancing their services beyond purchasing airline

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tickets. You wouldn’t book a safari to Africa or a tour of Italy through Orbitz. You need a travel agent’s knowledge and expertise. The lesson to be learned for insurance agents is obvious. If all you’re doing is handing out rates—like the travel agent who only printed out airline tickets— you may not survive the next decade. In this article, we speak with four subject-matter experts who are managing general underwriters within Aon Programs, who assist agents and brokers. Each provides suggestions on how professional insurance agents can provide value to their customers, stay relevant, and thrive in the digital age.

Differentiate yourself through value The truth is, if we eliminate agents, consumers will face problems. Who will advise them on insurance products? Online works fine when buying a TV through Amazon, but not when you are making decisions that affect your financial security. At a time when competition is forcing policies to become more diverse and more complex, people need to speak to an insurance professional now more than ever. “If a broker is simply using a comparative rater and laying out three prices in front of an insured, they’re not providing value,” said Steve Elliott, central region sales director at K&K Insurance, a managing general underwriter that specializes in the sports, leisure and entertainment industry. “Carriers can do that themselves and they already are. If you’re offering only a transaction, you will be obsolete, if you aren’t already,” continued Elliott. “Whether you’re selling personal or commercial products, you need to show a customer the value that you’re offering. Brokers are good at separating themselves from carriers. Their organization becomes the value proposition. Within most of those organizations, the insurance contract is one small piece of what they are offering when they sit down and talk with the customer.” “Their value proposition includes various types of services,” said Elliott. “Sometimes it’s proprietary data and analytics or it may be risk management, loss control or an internal claims department. Those are benefits within their own organization that they’re adding. They use them to differentiate themselves from what can be commoditized by a carrier.”

Know markets, stay ahead of niches One thing has not changed: Generally, consumers do not research terms like “bodily injury” or “aggregate limits.” The average consumers may understand their own auto and homeowners coverage—but not products like cyberliability or directors & officers liability. “There’s little knowledge out there about insurance. When a person gets educated on how coverages work—what they need versus what they don’t need—they’re impressed,” said Lauren Hansch, a business development professional with Aon Edge, a private flood insurance managing general underwriter. “They walk out of your office feeling like they’ve paid for something of value.” “For an insurance agent, that translates into knowing your market,” said Hansch. “If you have clients who are Uber drivers, there are coverages available to them that didn’t exist 10 years ago. There are coverages they can buy if 22

Professional Insurance Agents magazine

they have an Airbnb. Educating your customers and letting them know you are knowledgeable about changes in the industry, is an easy way to keep them. This means constantly doing your research, finding out what new niche coverages are available,” Hansch said.

Put the focus on coverage, not price As we all know, the market is price driven. But, if you’re just selling price, often you’re missing out on a key selling opportunity, according to Jeff Tirado, assistant vice president at Ian H. Graham Insurance, a managing general underwriter that specializes in helping brokers write community association property/ casualty business. “Providing value is being able to explain why I’m $1,200 and my competitor is $900,” said Tirado. “Yes, I might be $300 more a year, but the client is receiving seven additional coverages that can pay tens of thousands of dollars in claims.” “Don’t focus on the pricing, but on the value of the coverage,” said Tirado. “Your sales strategy has to be coverage. In the long game, price is not going to help you retain an account.” “Take ordinance and law coverage. On a homeowners policy, it’s minor. But, when you’re selling a commercial policy, it can mean tearing down a business because there are not enough handicapped parking spaces. Pointing out the value of that type of ancillary coverage can be huge.” “That’s a difference between a great agent and mediocre agent,” said Tirado. “If you’re out-performing someone in your office by 40%, there’s a reason for it. It’s because

you’re a coverage adviser, and that builds your reputation. People trust you and start giving you their business.”

Evaluate and advise on complex risks Another key value independent agents have over carriers and InsurTech firms is the ability to evaluate the whole risk. Typically, InsurTechs offer a single product. They’re not able to offer a one-stop shop, forcing consumers to deal with multiple points of contacts. In today’s high-speed world, that’s the height of inefficiency. “It’s no secret that there are a number of InsurTech firms out there, and carriers are developing InsurTech processes that can do what a lot of order-taking agents do today,” said Dave Zeornes, a business development executive at Aon Edge. “Monoline insurance selling from an insurance agent perspective is on its way out the door. Managing a customer’s entire risk is where the successful agents are going.” “Agents have this huge opportunity to advise on complex risks,” added Zeornes. InsurTechs don’t have the ability to dialogue with their clients. “Have you thought about this exposure? You might need this coverage. Or, you might need higher limits. Maybe they’re not taking advantage of all available credits.” Consumers who rely on online raters without speaking to an agent can be at a disadvantage. To them, all homeowners policies may look alike. “Without speaking to an agent, do they really know what they’re buying?” said Zeornes. “A good agent knows which questions to ask. He or she knows the coverage differ-

ences. The customer who’s just looking at price is not always going to get the best fit.” “Independent agents have the ability to offer different options, coverages and rates.” That gives them an advantage over InsurTechs and carriers. “Combine that with multiple lines of business and agents have a better chance of longterm success—and retention.”

Provide coverage comparisons A great value agents can offer their customers is coverage comparisons. “Recently I met with a broker who assembled three different carriers’ terms and conditions in a vertical format, so the client could compare what each offered,” said Elliott. “Then he used a color coding method, so the insured could participate in the process of prioritizing the things that were most important to him, the things that were neutral, and those things that didn’t matter.” “The broker laid all this out before he even got to the pricing,” said Elliott. “It was a matter of just adding up the green, red and yellow groups. That’s value. That’s understanding what you’re buying, instead of understanding what you’re spending. Big difference.”

Customer access to online tools A way that agents can add value over their competitors is by creating a web presence that offers relevant tools to their clients. “At times agents can be a bit old school,” said Hansch. “They have a website and they think that’s going to be enough—and it’s not. Organizations like PIA can help an agency jumpstart their social media and web presence. To thrive, that’s going to be a big thing.” Added Tirado: “From issuing certificates of insurance to acquiring loss runs, MGUs can add value by automating some of their services. A property manager or mortgage company doesn’t have to call in to get that information. They go to a website and pull it instantaneously. For condo-specific brokers, this functionality must exist for them to compete.”

Products to cover emerging risks Many agents and brokers don’t realize it, but they have the power to drive new insurance offerings. You are the industry’s boots on the ground. If a new risk is emerging, more than likely you’re going to hear about it first. “Independent agents have the ability to offer different options, coverages and rates,” said Zeornes. That gives them an advantage over InsurTechs and carriers. “Combine that with multiple lines of business and agents have a better chance of long-term success—and retention.” Recently, a New York agent examined his book of business and realized he had a lot of student accident policies. He also knew that there is a lot of crime on the college campuses in his area. He is now working with a carrier to create an inexpensive crime policy. Agents have this opportunity to take their industry-specific knowledge and use it to differentiate their business from the competition.

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Protect the Reputation and Assets You’ve Worked Hard to Build: Choose the Right Agents’ Errors and Omissions Program!

Keep the human touch An advantage an agent has over carriers and InsurTech companies is the human touch. They deal in relationships. You’ve been to your clients’ homes, their place of business. You know their families. You recognize their voice on the phone. You use the power of your relationship to advocate for them during a claim. “You can’t eliminate the dialogue that takes place between an agent and a consumer,” said Tirado. “Without that interaction, you become just another commodity.”

Utica National and the PIA of Tennessee can help. Over 50+ years, more than 10,000 agencies have placed their trust in the Utica National companies because they offer:

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Access to staff, including a claims team, who is dedicated 100% to Agents’ E&O Tailored levels of coverage based on your needs Risk management services that stay ahead of emerging issues to help you prevent claims A variety of ways to pay your premium without premium financing or interest charges

Invest a few minutes in the future security of your agency. Go to www.uticanational.com/eo to get started on an Easy Estimate, and then add and subtract coverages to get the combination of protection and premium you need! For more information contact: Kristopher Mark Fisher, LUTCF, CPIA Email: kfisher@PIATN.com Phone: 615-823-5057

Tom Gernt, CPIA Email: tgernt@PIATN.com Phone: 615-823-5079

Professional Insurance Agents magazine

Torneden is the business leader of Aon Programs, the division of Aon Affinity that provides more than 300 specialty insurance programs to the independent brokerage community. You can learn more about Aon Programs at aonprograms.com. Reach Torneden at jennifer.torneden@aon.com. 1

WillisTowersWatson, 2019

Statista, 2019

WillisTowersWatson, 2019

CB Insights, 2016

Bureau of Labor Statistics, 2019

Keep your sales from running out of gas Too many salespeople find themselves running on fumes when it comes to prospects. “I get up every morning and ask myself the same question: ‘Who am I going to talk to today,’” said a life insurance salesperson, who had been in the business for 30 years. He is far from being alone. Closing sales is the goal, but that takes keeping the prospect tank full of gas. So, what can you do about it? If you go to the supermarket, there is someone giving away free samples. If you watch what is going on, some of the people who are taking samples buy the product. It is the same with sales. When you do something nice for current and prospective clients, they want to return the favor. Here are some ideas for getting a positive response from current prospective clients: No. 1: Thanks for your complaint. When something goes wrong (and it always does), don’t be defensive. Surprise the customer by taking ownership. It creates an opportunity for a conversation, which can resolve a problem and turn an unhappy customer into an advocate. No. 2: Thank you for your business. This is so basic it shouldn’t be necessary to mention it, but online retailers have raised the bar; they know the value of showing their appreciation instantly. Here’s the point: When people spend their money, they like being noticed. No. 3: We appreciate your help. When someone does something nice for you, say so. For example, your message might go something like: “Thank you for thinking of us. We want you to know how much we appreciate your referrals.” No. 4: Ask for help. Often, customers can have an after-the-sale let down. Help avoid this. After letting them know how much you appreciate their business, ask for their help. “I want to do my best for my customers. I would value your opinion of what I can do to improve our agency’s service.” No. 5: Surprise customers. Nothing gets a more positive response like answering calls, messages, questions and inquiries super-fast. People unconsciously judge us based on the speed with which we get back to them. It says they’re important. No. 6: Stay in touch regularly. Call it your Continuing Cultivation Program. You never know what might be coming up next, so you want them to think of you. Make it helpful and friendly; no sales pitches.

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sales

john graham Principal, GrahamComm

No. 7: Need help? We can all benefit from a helping hand now and again. Let customers know you’re an available resource for discussing a problem or offering information and advice. No. 8: Offer helpful information. Keep your eyes open for articles, blogs and videos that customers and prospects may find useful. It’s a good way to let them know you’re thinking of them. No. 9: Send a value reminder. Choose a good time after customers have made a purchase to remind them why they made the purchase and ask them how it is working out for them.

No. 10: Send important reminders. Even though there may be an app for that, it’s easy to forget about expiration, renewal and due dates. Giving customers a heads-up lets them know you’re thinking of them and they can rely on you. No. 11: Remember life events. Anyone can do birthdays, but it takes awareness to recognize other meaningful occasions such as a new job, a promotion, a significant accomplishment, anniversary, new home, birth of a child or grandchild, graduation, wedding, or loss of a loved one. No. 12: Follow up after meetings. Whether it is a customer or a prospect, send an, “It was great getting together with you” message. To give it more impact, include something

personal that the person mentioned during the meeting. No. 13: Something new or different. Most of us like to know about what is new. If you have a new product or service, or if you have made a change, let customers know about it. Make the notice friendly and explain how it can benefit them. The remaining tactics include monetary components, so keep in mind your state’s rebating laws when you are considering them: No. 14: Send a $5 coffee gift card. It can create a feeling of obligation. When you send out the gift card, attach a note: “Sorry we couldn’t get together for coffee as planned. Will call you and arrange a time to meet.”

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No. 15: After the sale gift. When consumers make a significant purchase, they’re excited and proud because it’s the result of thought and planning—sometimes for years. It may be a major home improvement, a vehicle or a new house. Sending an appropriate gift creates enormous good will, which can result not only in future business but also in referrals. No. 16: Contribute to a customer’s favorite charity. Do it, not because you’re asked, but as a spontaneous expression of appreciation. To keep your sales gassed up, keep pulling customers and prospects closer to you. Some salespeople may see it as taking too much time; others will start and give up. Ignore them and keep moving forward. Graham of GrahamComm is a marketing and sales strategy consultant and business writer. He is the creator of Magnet Marketing and publishes a free monthly eBulletin, No Nonsense Marketing & Sales Ideas. Contact him at jgraham@grahamcomm.com or johnrgraham.com.

Which of your clients could use an umbrella? When looking at various errors-and-omissions claims involving umbrella coverage, there are circumstances when the gaps between the actual underlying limits and those required limits are major concerns. However, in the majority of those cases, the real issue is the lack of the umbrella. Essentially, there is a claim in which the underlying limits were not sufficient to cover the claim. Unfortunately, when this occurs, the possibility that the agency could be involved in litigation (due to the absence of the umbrella) increases. Why, then, don’t more personal and commercial customers have this important coverage?

Who has the potential? There are instances when an agent presents a customer with an umbrella proposal, and he or she chooses not to buy it. This is fine, providing there is solid documentation of the offer and the declination. Could there be situations in which the client is not even offered an umbrella proposal because the agency customer service representative or producer did not think he or she needed it? Absolutely. Consider this: On any given day, the news reports on major accidents in which the potential to exhaust the underlying coverage limits exists. Which of your clients need an umbrella? To ask the question in a different way, which of your customers has the potential to cause an accident in which the underlying auto or homeowners limits of their insurance policy will not be sufficient? Most likely, they all do. Why, then, has an umbrella proposal not been offered to all of your customers?

E&O

Curtis m. pearsall, cpcu, CPIA

will not be an umbrella discussion with the young-adult client. After all, what could the young adult do that could cause a serious auto accident or result in a significant liability exposure? Plenty! Bottom line: The size of the client’s assets does not determine the potential size of auto accidents or liability

Bottom line: The size of the client’s assets does not determine the potential size of auto accidents or liability exposures.

Some agency staff members may judge whether to offer an umbrella policy based heavily on the size of that specific customer’s assets. When an agency CSR deals with a personal-lines customer who has two homes, three cars and a boat, the thought of offering an umbrella seems more logical. After all, the customer has the assets, and umbrella is a coverage that will assist to protect those assets. The same is true for a commercial-lines customer with a multiplevehicle fleet and a significant general liability exposure.

exposures. What if the client just graduated and he or she has a college debt of $200,000? What are this individual’s net assets? It is probably a negative number, yet this person still has the ability to cause a significant loss when the underlying insurance is not sufficient—just as great as the person who owns two homes, three cars and a boat.

Going back to the personal-lines customer, contrast that customer with a young adult who owns a car and rents an apartment. If one were to judge the need for an umbrella by the size of the assets, there is a good chance there

In the commercial-lines scenario, contrast the customer with multiple vehicles and a storefront operation

Who receives a proposal?

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with a one-person operation, such as a contractor or salesperson. Does one of these exposures offer a greater likelihood there will be a sufficient claim? While the customer with multiple vehicles probably presents a greater exposure, it does not mean the customer with one vehicle does not have an exposure. In addition, accounts such as contractors have other exposures that present tremendous potential for a sizeable general liability loss.

SAVE THE DATE! August 29, 2020

85th Annual

Write more umbrellas

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To reiterate, which of your customers need an umbrella? Most likely, they all do. Agency staff should be careful not to prejudge customers when they are determining their insurance needs. There is the requirement that certain minimum underlying limits be carried to secure an umbrella, so when dealing with current and prospective customers, discuss the benefit and cost of an umbrella. Propose a variety of limits for the considered coverages. This will let the customers know you are not recommending a specific limit and that higher limits are available. This also forces them to make a decision on which limit they want and those that they reject.

Convention

Most agency management systems provide the ability to identify those accounts that don’t have an umbrella. Make it a goal to advise all of your customers about umbrella coverage (e.g., what it does and how much it costs). For some customers, you must factor in the cost to increase his or her underlying limit. If a customer rejects the proposed umbrella, get his or her sign-off.

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Ultimately, you are likely to find yourself writing more umbrella policies.

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