Spring 2018 Magazine by PIA of Tennessee

RD-WINNING AWA

Spring 2018 â&#x20AC;¢ Tennessee

PAGE 16

BRIDGE THE GAP

The boomer exodus and the millennial surge

INSIDE THIS ISSUE 11 Possible flooding? 21 Hire from all walks of life 27 What not to ask

TEAM UP WITH MidSouth Mutual Create a Win for Your Agency and Your Clients MidSouth Mutual provides workers’ compensation insurance, risk management resources and claims services to drive success for your agency and your construction clients! We are growing throughout the MidSouth and Midwest. Soon even more states will be added. We pleased to report MidSouth Mutual has earned an “A” Exceptional rating from Demotech, Inc. We leverage our deep knowledge of the construction industry to the direct benefit of our agency partners and construction industry clients. MidSouth Mutual Insurance provides independent insurance agents and their clients throughout the region superior workers’ compensation insurance products backed by a commitment to exceptional service. As we continue to grow, MidSouth Mutual is clearly focused on managing the fundamentals of our business intelligently as part of a strategy of sustainable quality growth. The company is committed to doing business the right way in service of our clients. We encourage you to learn more and contact us today!

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Carpenters Framers Dry Wallers Landscapers

MidSouth Mutual provides insurance to clients in Alabama, Arkansas, Georgia, Indiana, Kentucky, Mississippi, Nebraska, North Carolina, Tennessee, and Oklahoma.

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Departments 4 Spring 2018 • Tennessee

In brief

7 Security 11 Risks 13 Tech 25 E&O 27 Staffing

Cover story 16 Bridge the gap

Readers’ service and advertising index

Officers and directors directory

The boomer exodus and the millennial surge

Feature 21 Hiring? Consider employees from all walks of life

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. President and CEO of PIA Management Services Inc. Mark LaLonde, CPIA, CIC, AAI; Executive Director Kelly K. Norris, CAE; Communication Director Mary E. Christiano; 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. ©2017 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 director

Rebirth!

Spring has sprung! It’s finally warmer. Rain is falling. Flowers are beginning to bloom. Those plants and creatures that recently lay dead in sleep over the winter are rising to new life. It is that ever-present cycle of renewal to which we all look forward. And, rebirth is upon us.

• marketing, website and social-media tools and assistance; • insurance coverage with special endorsements, coverages or discounts specifically for our agents; • live, webinar and self-study professional development education programs;

As we enter the spring and you are reading • networking and engagement events to this article, the holiday season is behind make valuable connections; and the us. Many of us just returned from our • latest updates and information regarding Day on the Hill at the Tennessee Capitol, Kristopher Mark Fisher, the ever-changing industry. and from Washington, D.C., where we CPIA, LUTCF Executive Director were lobbying for you and your business PIA continually adds new features and PIATN clients. You can see a summary of those resources through the updated website Franklin, Tenn. issues and topics on our website (PIATN. at PIATN.com, and through our eBlast com). For some of us, we just experienced and social-media campaigns. If you see the busiest time of the year in the first a resource or tool you would like PIA to quarter. As we pause for just a moment, are you where you consider, let us know. As an association, our job is to idenhoped to be at this moment in time? Are you on-track for tify those common issues facing Main Street agencies, the goals you set? Or, could you utilize a little assistance, and coordinate and develop solutions that are difficult for additional resources, or guidance? a smaller agency to do on its own. One of the ways this association can assist you is through the resources and services we have developed to help you grow your team or business, retain your customers, be a more educated professional, or be more efficient. PIA of Tennessee is in a rebirth cycle, molding and developing itself into a better and more helpful resource for a smallto-medium-sized independent agency. Through the PIA, you have access to: • strategic alliances dedicated to helping the independent agent write more business; • resources to help you hire, license, onboard and train new team members;

There is no better time to engage with the PIA than right now. And, there is no better engagement event than our 2018 PIA-TN Annual Convention and Trade Show on June 28-29, 2018, at the brand new GuestHouse at Graceland Resort in Memphis, Tenn. Come out to get educated; see how vendors incorporate the “Elvis Movie” theme at the trade show; and be energized by the excitement of the event. You’ve never seen a venue like this resort, and there will never be another convention like this one. For more information and to register, go to PIATNconvention.com. It will be a great investment in your business and time.

• tools to streamline your new business and renewal processes;

Professional Insurance Agents magazine

platinum partner profile

AmTrust North America 1014 Harness Circle

third nationwide in SNL Financial’s April 2016 workers’ comp market share report, and is publicly traded on the NASDAQ Global Market under the symbol AFSI.

Gallatin, TN 37066 www.amtrustgroup.com

The property/casualty lines of coverage offered by AmTrust include workers’ comp, BOP, property, employers’ practices liability, commercial auto general liability, garage and inland marine. These lines also have been customized to fit the auto service repair, financial institution, lumber, nonprofit, restaurant and transportation sectors.

Philosophy Senior executives Joel Alligood, regional vice president Dorothy Howell, regional sales director for the southeast region

Tennessee staff

AmTrust’s philosophy is: “AmTrust has multistate capability, multitiered pricing and multiline capability, combined with exceptional customer service and a dedicated staff of insurance professionals, who all share the same vision. Insurance is our product, customer service is our business. “By visiting AmTrust Online at our website, insurance agents can make a submission or check their clients’ policy information at any time, day or night. More than 350 business classes are eligible for coverage nationwide under our wide-ranging underwriting appetite.

Chuck Allen CLU, ChFC, regional sales manager (615) 420-0574 charles.allen@amtrustgroup.com

History AmTrust North America is a national insurance carrier with an “A” (Excellent) FSC “XIV” rating by A.M. Best. The company provides a broad suite of business insurance products, including workers’ compensation and niche commercial lines coverage for small- and medium-sized businesses. With extensive underwriting experience, AmTrust has earned a reputation as an innovative, technology driven provider of insurance products. AmTrust was ranked

“To better serve the unique needs of policyholders, AmTrust offers an extensive selection of flexible payment plans, including PAYO® (Pay-As-You-Owe®), direct debit/ EFT, credit card, electronic check and monthly or quarterly installments. Our dedicated team of loss-control professionals also stands ready with workplace safety advice and support for business owners, while our Claims Reporting Center is open 24/7 when accidents inevitably occur.” For more information about AmTrust, visit AmTrustNorthAmerica.com or call (877) 528-7878.

PIA of Tennessee and AmTrust proud partners for independent agents

www.piatn.com

platinum partner profile

CMS Insurance Service Inc. Ripley, West Virginia

Insurance was born and a unique philosophy was created out of need within their own agency. The “CMS philosophy,” coupled with a strong desire to help other independent agents, has made CMS what it is today.

www.cmsinsurance.net

Philosophy

CMS Insurance Service Inc. writes business in Tennessee, Kentucky, West Virginia, Indiana and Montana.

According to CMS Insurance: “Our mission is to help support and perpetuate the independent agency system in a manner consistent with principles based on fairness and integrity. We are committed to the growth and retention of the family-owned independent agency. “We are a general agency; however, we are not a broker. We partner with agencies to provide markets whereby you are the agent and you own your book of business. It is important to distinguish that anyone can ‘provide markets,’ but it’s how we do business at CMS that makes us different— our unique philosophy and straight-forward approach to compensation is what truly sets us apart. In addition to providing markets, we offer the following specialized programs: commercial consulting; performance-based compensation (for agency owners); and agency perpetuation and other related programs targeting profitability/ growth/stability.

Senior executives Conn Johnson, CEO Mark Johnson, president/COO

Tennessee staff Tyler Siddens, regional marketing manager (270) 991-3994 tyler@cmsinsurance.net

History Conn and Joyce Johnson began an independent insurance agency—Johnson Insurance Agency—in a small town in West Virginia more than 40 years ago. Johnson Insurance is a family-owned agency that was created from the ground up. The knowledge and perspective gained from these “real-world-insurance” experiences provided the inspiration for CMS Insurance Service Inc. Conn and Joyce understood the real challenges and true needs surrounding the independent agency system; thus, CMS

“Whether you are competing with the agency down the street; looking for additional markets; searching for ways to compete in an ever-changing marketplace or just trying to become more profitable, we can help you with our unique system of programs designed specifically for the independent agent. We’ve been helping independent agents, just like you, for more than 30 years! We are proud to be family-owned and proud of what we strive to represent—give us the opportunity to help your agency and let us demonstrate what makes us different.”

“Our agency has enjoyed doing business with CMS for the past nine years. As an agent, it is comforting to do business with an honest, reliable and family-oriented company. CMS understands the needs of agents … We are thankful for our business partnership with CMS.”—Gina Tynes-Hocker, agent, Family Insurance

PIA of Tennessee and CMS Insurance proud partners for independent agents

Professional Insurance Agents magazine

Understand the CIA Triad Recently, the 23 NYCRR 500 regulation adopted by the New York State Department of Financial Services mandated that covered entities must maintain a cybersecurity program designed to protect the confidentiality, integrity and availability of the covered entity’s information systems. What does that mean exactly? Well, to start, it means we should discuss the CIA Triad. The CIA Triad is an information security concept that consists of three core principles: 1. confidentiality; 2. integrity; and 3. availability. These core principles become foundational components of information security policy, strategy and solutions. Cybersecurity professionals and executives responsible for the oversight of cybersecurity programs should have a deep understanding and appreciation for each of the three core principles.

security

joe yetto President, TAG Solutions

Ultimately, all vulnerabilities and risks should be evaluated based on the threat they pose to one or more of the CIA Triad core principles. In addition, all security controls, or countermeasures, should be evaluated on how well they address the core principles of the CIA Triad. Let’s explore each core principle in more detail.

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Confidentiality This core security principle is defined as the ability to restrict unauthorized subjects from accessing data, systems, objects or resources. This means that only certain people should have access to certain information or systems. Imagine employees who punch the timeclock and go home for the evening, but they forget to shut down or lock their computers. Even worse, they still are logged into the client database that contains all sorts of personally identifiable information (e.g., clientâ&#x20AC;&#x2122;s names, addresses and Social Security numbers). What happens if the janitorial service shows up to clean the office space and a cleaner notices the unlocked computer and helps him or herself to the valuable information? Confidentiality of personal information is important. There are many cyberattacks that are used to violate confidentiality including, social engineering; theft of credentials or passwords; eavesdropping; and network sniffing. Your cybersecurity program should be influenced by the confidentiality principle. Here are a few controls that you should consider incorporating into the program: No. 1: Inventory of devices and software. It is difficult to manage access to devices, applications and systems unless you have an accurate inventory of those assets. Once you understand what assets you own, only then can you begin to think about who is authorized to access and use them. No. 2: Data classification. You must understand what data or information resides on your information systems. More importantly, you have to classify this data so that it can be protected according to value, sensitivity and regulatory compliance.

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No. 3: Access controls. Systems and information should be physically and/or logically segregated based on data classification efforts. Access to systems and information should be granted to authorized users on a need to know basis. Document and enforce procedures for granting and revoking access. Strong password policies should be implemented and enforced. Minimize and monitor privileged accounts closely by using logging and notification technologies. Authorized users should employ multifactor authentication when accessing systems and data; data classification efforts; and regulatory requirements. No. 4: Encryption. Encrypt information at rest and in transit according to data classification, regulatory requirements and the annual risk assessment. There are a variety of encryption solutions, which range in price and functionality. The objective is keep information confidential by encrypting it. No. 5: Personnel training. Many confidentiality breaches occur by accident or mistake. Authorized users need proper training. They should understand your data classification policy and acceptable use policy. They should understand why certain security controls are in place; how to use them properly; and why they should never attempt to circumvent them. Lastly, they should understand the threat landscape as it relates to confidentiality and how their actions and behaviors can help mitigate those risks.

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Professional Insurance Agents magazine

This core security principle is defined as the ability for data and informa-

tion to retain truth or, accuracy and be intentionally modified by authorized users only. This means information should not be altered unless the alteration is sanctioned and done with purpose. Imagine a patient under the care of doctors and nurses at a hospital. The patient requires 100 milligrams of medication every six hours. What happens if the nurse accesses the patientsâ&#x20AC;&#x2122; medical records and the 100 milligrams is modified (with malicious intent or by accident) and now reads 1,000 milligram? Integrity is important.

No. 1: Data backup systems. Effective data backup strategies should be defined, implemented and monitored for success. If systems or data become unavailable, recovery efforts usually start with restoring from a successful backup job.

There are many cyberattacks used to violate integrity, including: computer viruses, malware, logic bombs, database injections and altering system configurations. Your cybersecurity program should work to promote integrity and defend against these attacks. Here are a few controls that you should consider incorporating into your agencyâ&#x20AC;&#x2122;s program:

No. 2: Disaster recovery and business-continuity planning. Documenting disaster recovery and business-continuity plans is an absolute must. In addition, these plans should be tested, at least annually to verify their effectiveness.

No. 1: Intrusion prevention systems and intrusion detection systems. These systems examine network traffic flows to detect and prevent vulnerability exploits. Often, this technology is embedded in perimeter defenses such as firewalls. However, it needs to be enabled and configured to work properly. No. 2: Anti-virus/anti-malware. This powerful tool can detect, quarantine and even remove malicious code from computers and systems. It is imperative that antivirus software is installed and configured on all computing devices. No. 3: Vulnerability management. There should be a process for identifying known vulnerabilities across systems and applications and then remediating those vulnerabilities typically by installing patches. No. 4: Log monitoring and analysis. The ability to collect system and application logs and then monitor/analyze them is critical. It can detect anomalies in system behaviors and be used in forensic efforts post incident.

Availability This core security principle is defined as the ability to grant authorized users uninterrupted access to systems and information. This means if someone is supposed to have access to a system or information, then that system or information should be made available to them at all times. Imagine logging into your computer on Monday morning. You are refreshed from the weekend, ready to work and conquer the world. Then suddenly, a message flashes across your computer screen. The message explains that your computer and everything on it has been encrypted by ransomware, and you must pay a fee to receive the decryption key and resume regular work activities. You no longer have access to email, customer records, financial records, etc. What would you do if the applications and data on your computer were no longer available to use? Availability of your computerâ&#x20AC;&#x2122;s files are important.

No. 3: System monitoring. Monitor critical systems and applications continuously for performance and capacity requirements. Proactive monitoring often can prevent unwanted outages or disruptions. No. 4: Incident response plan. Having a plan to contain, eradicate and recover from a cybersecurity incident is invaluable. Incidents create stress and chaos. Having an incident response plan introduces confidence and organization. As one can see, the core principles of the CIA Triad are simple information security concepts that when applied properly to policy and program creation can have a real meaningful impact your ability to stay safe and protected. Yetto is president of TAG Solutions. Reach him at www.tagsolutions.com.

There are many cyberattacks used to violate availability, including: computer viruses, malware and denial of service. There also are circumstantial events that violate availably such as hardware failure and natural disasters. Your cybersecurity program should be influenced by the availability principle. Here are a few controls that you should consider incorporating into the program:

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Doing The Right Thing Since 1964 Standing Tall

Mark Maucere, Andy Roe, Jim Roe, Chad Trainor, Janet Phillips and Jim Eades

Ready to stand out? We’ll stand with you. To keep your agency relevant, you need the right products, partners and people. Our team of dedicated and responsive professionals can help you fill the gaps in your insurance offerings, providing more unique opportunities for you to meet the needs of your clients. The more you get to know us, the more you’ll see the possibilities.

Let us help you find the right solutions. ®

The cold wet truth Every part of the U.S. is at risk for flooding. While temperatures vary from region to region, one thing is constant from sea to shining sea: flood risk is everywhere, year-round. Since spring thaws melt the winter’s snow and ice, now is the time to remind your clients to think about their flood risk. Floods are the number one disaster in the U.S.—30-40 percent of the flood claims are paid in low-to-moderate risk areas (X Zone).1 In colder climates, large amounts of snowfall are often followed by major rainfall. Ground that is frozen can’t absorb the rain. Flooding causes damage and destruction across regions nationwide; wiping out homes, businesses and personal financial resources. Residents need to know they can take steps to protect their property and financial security before disaster strikes. As their professional, independent insurance agent, you can remind them to: • Purchase a flood insurance policy, which can sometimes be as cheap as a morning cup of coffee. • Review their current insurance policy and become familiar with coverages and exclusions. • Move the snow away from the property’s foundation. • Clear the gutters, drains and downspouts. • Install a sump pump in the basement or inspect the existing sump pump. • Make a flood plan that includes evacuation routes and keeps important papers in a safe, waterproof place.

The cause of flooding Now is the time to remind your clients that there are many conditions that can cause flooding in the winter and spring, including coastal flooding, ice jams and rapid snowmelt. Winds generated from winter storms can cause widespread tidal flooding and severe beach erosion along coastal areas. Long cold spells also can cause the surface of rivers to freeze, leading to ice jams. An ice jam occurs when a rise in the water level or a thaw breaks the ice into large chunks, which become jammed at the man-made and natural obstructions. A sudden release of an ice jam causes severe flooding. When the water is released, it flows downstream quickly causing significant rise in water levels in a short period of time (i.e., flash flooding). Sudden thaws of heavy snow pack also will lead to flooding. A midwinter or early spring thaw can produce large amounts of runoff in a short period of

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risks

Katherine howington, cfm, anfi National flood sales manager, Bankers Insurance Group

time. Because the ground is hard and still frozen from low winter temperatures, water cannot penetrate and be reabsorbed. The water then runs off the surface and flows into the lakes, streams and rivers, causing excess water to spill over their banks. From Atlantic to Pacific storms, a wet winter puts property at risk for flooding in both winter and spring.

Loss avoidance measure If your clients have flood policies, don’t forget to remind them about the loss avoidance measure in the policy section of the National Flood Insurance Program manual, which states:2 A general and temporary condition of flooding in the area near the described location must occur, even if the flood does not reach the building or a legally authorized official must issue an evacuation or other civil order for the community in which the building is located calling for measures to preserve life and property from the peril of flood. 1. We will pay up to $1,000 for costs your client incurs to protect their structure from a flood or imminent danger of flood for the following:

Sandbags, including the sand to fill them. Fill for temporary levees, pumps and plastic sheeting including lumber used relating to these items. The value of work, at Federal minimum wage, that you or a member of your household preform. Basically, whether your client purchases sandless sandbags, barrier walls or any other type of flood mitigation products to protect the structure from Imminent danger of flood, we will reimburse your client. They must save their receipts to give to the flood carrier. We will also pay up to $1,000 for the reasonable expenses your client incurs to move their property to a place other than the described location that contains the property to protect it from flood or imminent danger of flood for a period of 45 consecutive days from the date your client begins to move it there. The personal property that is moved must be placed in a fully enclosed building or otherwise reasonably protected from the elements. Any property removed including a moveable home, must be placed above ground level or outside of the special flood hazard area. For commercial structures, the same applies however they could also be covered for Pollution Damage caused by pollutants to the covered property if the discharge, seepage, migration, release or escape of pollutants is caused by or results from a flood. The most we will pay under this coverage is $10,000. The coverages in the Loss Avoidance Measure does not increase coverage A or B limits of liability.

You can help your clients to be smart, be prepared and be protected. Have the “flood talk™” with your client today and make sure they know it takes 30 days for a flood policy to become active. They need to know that once the flood waters start to raise it’s too late. Howington lends her expertise to provide quality flood training; to teach continuing-education flood classes; and to analyze the risks for structures in the floodplain. Reach her at (800) 627-0000, ext. 4217, or katherine. howington@bankersinsurance.com. 1

FEMA.gov

The National Flood Insurance Program manual, Oct 2017 version, Dwelling Policy pages 9 and 10 Coverage C–other coverages and General property form pages 38 and 39 Coverage C–other coverages

Remember, for the loss avoidance measure; the flood must be imminent and your client will need to keep their receipts if they need to file a claim.

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Professional Insurance Agents magazine

Elba, Alabama

Indemnity Jones and the raiders of the lost policy At the core of every long-tail exposure is the threat of insufficient or nonexistent liability limits. Deep in the past lay the unearthed coverage details that can only be evidenced by the existence of a policy contract. This is more than curiosity; this can mean the difference between financial ruination and financial redemption. When the stakes are this high, you need the services of Indemnity Jones—the insurance archeologist. You might call him an “obtainer of rare antiquities.”

Tech

dan corbin, cpcu, cic, lutc Director of research, PIA Management Services

Conceived in 1981, insurance archaeology responded to the first wave of asbestos claims. The late Randolph Fields, an international lawyer, gambler and airline owner, having had homes in Scotland, California and Jersey (Channel Islands), appears to be the architect of this specialized area of insurance consulting. Now, R.M. Fields, an international firm, provides services to agribusiness, airport authorities, brewers, builders, chemical companies, cosmeticians, distributors, dry cleaners, miners, municipalities, plumbing suppliers, power companies, realty companies and refineries. Any time an old occurrence policy can be evidenced to respond to a present claim, these services are invaluable in locating a tangible asset to offset a liability. Obviously, the services of an insurance archeologist would not be needed if the business entity maintained all of its policies (or copies) over the years. Ignorant of toxic torts (“try the local sewer”), latent injuries and environmental damage that were later to manifest themselves, business owners felt no compelling reason to preserve their policies.

Primary evidence Assuming it still exists, the first step is to try to find the expired policy. Archeologists have been clever and resourceful in locating policies in attics, barns, garages, warehouses, underground storage facilities, even the bathroom of an executive’s office. Sometimes, the venue can get nasty; you might even run into snakes. “Asps! Very dangerous.”

Secondary evidence In many cases, the original policy no longer exists (“bad dates”); so the next step is to find secondary evidence that will effectively reconstruct the existence of the policy. Guiding an archeologist at this point will be a competent attorney. There are federal and state rules of evidence to be considered. In general, acceptable testimony will deem the policy lost or destroyed, but the policyholder must not have acted in bad faith to suppress damaging informawww.piatn.com

tion and a diligent effort must have been made to find the policy (e.g., hiring an archeologist). Further, an attorney can determine the burden of proof required for a particular jurisdiction. Will it be the common “preponderance of the evidence” (i.e., more likely than not) standard or the less common “clear and convincing evidence” (i.e., compelling) standard? “I don’t know, I’m making it up as I go.” Another legal issue is the authentication of a document presented as secondary evidence in the attempt to reconstruct a missing policy. It must be classified under the exceptions to the rule of hearsay. A document could be authenticated by having been filed in a public office. In other 13

cases, a document in existence for 20 years or more is granted authentication merely by its age (“It’s not the age, but the mileage.”). Beyond that, the testimony of a person having personal knowledge about the document under scrutiny will, in many cases, be accepted.

Types of evidence Typically, insurer documents carry the most favorable weight in proving a policy, with producer documents close behind, and then policyholder documents. The testimony of a witness, such as an employee, also can be admissible. Secondary evidence can take a multitude of forms. Some of these include: policy declaration page; binder or certificate of insurance; interoffice correspondence; subsequently renewed policy; insurer’s claim reserves; policyholder accounting records; corporate meeting records; evidence of reinsurance; producer ledger; premium invoice; government permits; policyholder accident reports; lending documents; attorney files; underlying umbrella coverage; or loss prevention surveys. The pursuit of evidence and the extent of the investigation have no limit unless unwarranted due to the size of the claim for damages.

Historical complications One of the problems that an archeologist will encounter is the historical evolution of insurers, brokers and business entities (“now you’re getting nasty”).

Your association is also your own private ad agency. Logos Branding

Another problem occurs when attempting to match historical coverage forms to a policy written by an insurer in a particular year. Initial policy evidence may be limited to just basic information typically on the declarations page. If the insurer was a member of a rating bureau, then research can be performed to identify the standard forms in use at that time. Proprietary forms are more of a challenge. Pursuing records from wholesale brokers and Lloyds may help to catalog the nonstandard forms used by specific insurers writing similar risks decades before the present claim. It also may be possible to establish coverage evidence based upon coverage in subsequent renewal policies that are known to exist. How far the policyholder takes the investigation will depend upon the amount of damages for which the policyholder is liable. Sometimes all you need is the Indemnity Jones Fedora to find your asset, but at times, you might need to bring a whip.

Graphic design Newsletters Printing on site Mailing services Consumer pieces

Corbin is PIA Management Services’ director of research.

Trade-show displays Member discounts! (800) 424-4244 • creativeservices@pia.org 14

There have been mergers, acquisitions, consolidations, insolvencies, bankruptcies and liquidations. Under these circumstances, tracking the insurance records for a policyholder demands a vast amount of research. However, once an archeologist assembles the various insurer and broker family trees for a select type of industry risk, they can be referred to repeatedly. Predecessor details also will be required of the policyholder. You don’t want to be “digging in the wrong place.”

Professional Insurance Agents magazine

Why Choose West Bend? People Insurance is a people business, and at West Bend, we pride ourselves on approachability and accessibility at every level of our company.

Relationships We consider the relationships with our agents to be partnerships. Agents are our primary customers, and we support, and wholeheartedly endorse, a strong independent agency system.

Stability Since 1894, West Bend has come to stand for excellence through the use of innovative products, steady growth, and financial stability. Since 1971, we’ve maintained an A (Excellent) or better rating from AM Best.

Regional Mutual Insurer As a regional mutual insurer, West Bend decides what to do, and our decisions are always based on what’s best for our agents, insureds, and associates for the long term. As a regional insurer, we understand the local and regional markets.

Products Our product offerings are well rounded, innovative, and diverse. West Bend is an industry leader in writing a wide range of businesses, including most found on your town’s Main Street. Through our specialty division, we specialize in writing risks many other companies turn away. Our bond department makes contract and commercial bonding easy to quote and issue. And our monoline workers’ compensation division provides a high-touch, resultsoriented approach to help customers control the cost of insurance.

Service Our dedication to service is what sets us apart from our competitors. Our knowledgeable and skilled teams of professionals provide unmatched service and dedication to our agents and their customers.

It doesn’t end there Put all of these together – and more – and you’ll find West Bend offers distinct value through superior agency relationships, strong financial performance, stability, commitment to outstanding products and services, and knowledge and experience. That’s why agents choose West Bend. To find out more about representing West Bend, contact Randee Hubbard at rhubbard@wbmi.com.

Bridge the gap The boomer exodus and the millennial surge

ccording to Pew Research Center, ten thousand baby boomers will turn 65 today, and every day, for the next 19 years.1 While we can’t blame baby boomers for choosing rounds of golf and beach vacations over their desk jobs, the impending “Silver Tsunami” will have a profound impact on almost every industry across the U.S. As these thousands of Americans retire like clockwork, many organizations will face a challenge that’s twofold: 1. filling the workforce gap that baby boomers are leaving behind; and 2. how insurance businesses can compete in an increasingly tight recruitment market, especially when it comes to millennials.

Professional Insurance Agents magazine

BEN DEDA Vice president of marketing, Vertafore

www.piaTN.com

Usually, more traditional industries that have attracted older generations, like insurance, will be disproportionately affected by the departure of boomers; one quarter of insurance agents are expected to retire in the next two years. So, what will the next generation of insurance professionals look like and how can the industry grab top talent from the millennial age group?

What millennials want More than 1-in-3 American workers today are millennials,2 boasting a workforce of more than 53 million. Because millennials represent such a large part of today’s workforce—and will continue to dominate as the wave of the “Silver Tsunami” rushes toward shore—they’re in a unique position to shape current corporate culture to best suit their needs. Contrary to common stereotypes, the latest data shows that millennials aren’t prioritizing perks like happy hours and foosball tables, but rather identify more practical benefits. When asked by Harvard Business Review what tops their job search criteria, millennials over-indexed on “opportunity to learn and grow,” “opportunity for advancement,” “quality of manager,” and “quality of management” when compared to other generations.3 For example, baby boomers ranked “overall compensation” as the top driver of potential job searches. Beyond recruitment, retaining millennial employees also comes with its share of challenges. According to Gallup’s 2016 report, “How Millennials Want to Work and Live,”4 21 percent of millennials reported changing jobs within the last year, which is more than three times the number of non-millennials who report the same. Millennials also felt less committed to their current jobs, as only half of millennials strongly agreed they planned to be working at their current company one year from now. Rather than stay tied to an industry, millennials pursue careers that align best with their life needs and goals. What’s interesting is that millennials working in the insurance industry go against many of these larger trends, signaling a growing opportunity for insurance companies to capitalize on this group of potential employees. Millennials can not only deliver value to insurance organizations, but drive the adoption of new technologies to help the industry continue to grow and innovate.

Giving millennials what they want While other industries may look to this generational shift as a challenge, the insurance industry has identified it as an opportunity. Insurance is setting itself apart by giving millennials what they desire out of their careers, retaining considerably higher rates of millennial employees when compared to other industries, and continuing to be dynamic in the face of new and unexpected workforce challenges. Recently, Vertafore released results from its fourth annual “Millennials in Insurance”5 survey, which aimed to dive deeper into the career preferences of millennials and gauge how the insurance industry stacks up against their needs. The survey received nearly 3,500 responses from professionals currently employed in the insurance industry, including 1,556 millennials (people aged

Professional Insurance Agents magazine

19 to 35 years old). The good news? Insurance is giving millennials what they want—and they’re telling their friends about it. The survey found that millennials cited many benefits to a career in insurance, with career growth opportunities (63 percent); rate of compensation (55 percent); and work-life balance (50 percent) topping the list. This is likely the driver for millennials staying put longer in insurance careers when compared to other industries. With two-thirds of millennials working in the insurance industry for three years or longer, and planning to stay put as long as possible, companies need to continue to focus on both recruiting and retaining this coveted group. Beyond their own careers, 82 percent of millennials would recommend a career in insurance to their friends and family, while 39 percent of millennial respondents said a friend recruited them into the industry. Millennials hold a variety of roles across the insurance industry, but account management or customer service ranks highest (39 percent), with producer or sales roles following at 23 percent. Millennials also are 2.5 times more likely to be an underwriter or adjuster when compared to baby boomers. Despite being a more traditional industry, millennials acknowledge the adaptability of insurance, with 86 percent of respondents reporting they are “somewhat” or “very optimistic” that the industry will be able to attract future workers. Further, only 12 percent of millennials reported being concerned that InsurTech startups like Trov, Metromile and Lemonade will impact their current business, underscoring millennials’ belief in the industry.

The millennial trifecta

expressed satisfaction with their company’s use of technology, and believe that technology is increasing efficiency by arming them with the tools they need to compete and succeed (78 percent).

The millennial survey also found there are three aspects that continue to affect and influence millennials: 1. online presence; 2. technology; and 3. flexibility.

No. 3: Flexibility. Insurance agencies also should consider establishing a formal professional development program, incorporating internal trainings; freedom to attend off-site workshops; and stipends to take online courses or purchase reading material. Internally, managers should initiate a regular cadence of meetings with those they manage and continually solicit peer feedback to share with employees.

No. 1: Online presence. While the insurance industry is delivering on millennial needs for current employees, independent agents also are tasked with how to best attract new millennial hires and expand their teams. Beyond personal referrals and word of mouth, 20 percent of workers aged 19-35 are answering job postings via websites like Indeed, Monster and Glassdoor. It’s crucial for independent agents and agencies of all sizes to continue to embrace an online presence to find millennials where they’re most active. On top of job posting websites, maintaining a strong social-media presence on LinkedIn, Facebook and Twitter will help expand the reach of job postings, build brand visibility and industry recognition. Employee incentives also can spur an increase in candidate referrals. No. 2: Technology. When it comes to retaining millennial employees, insurance companies should continue to leverage technology, prioritize professional development and establish a corporate culture that offers work life balance. Technology is at the forefront of insurance communications, with video messaging used by agents 75 percent more often in 2017 than in 2016, while Instagram (up by 50 percent); instant messaging/chatting (up by 41 percent); and texting (up by 14 percent), also grew in usage since last year’s survey. Further, the majority of millennials surveyed (59 percent)

To aid millennial employees in achieving work life balance, insurance companies should also offer a flexible work environment, with less traditional schedules, adjustable work hours and the opportunity to work from home or remotely, if needed. While not a major adjustment on a company’s end, these small changes can have a significant effect on millennials’ happiness at work and may increase the likelihood they will stick around for the long-term. Additionally, given the diverse nature of today’s millennial workforce, companies should offer diversity training to strengthen cultural awareness and promote the acceptance and celebration of differences. Diversity training can help promote inclusion and break down any barriers across teams, making for employees that are united in the face of any challenges.

The future looks bright Young professionals have identified insurance as an industry as one they believe they can hold lifelong careers, thanks to the combination of technology adoption and professional development opportunities. Insurance agents should be encouraged to continue to integrate technology into their practice and offer a corporate culture that aligns with millennial preferences. If they do, we’re certain the whole industry will establish long-term loyalty. Deda is the vice president of marketing at Vertafore, a leader in modern insurance technology. For more information, see vertafore.com. pewresearch.org/fact-tank/2010/12/29/baby-boomersretire/

pewresearch.org/fact-tank/2015/05/11/millennialssurpass-gen-xers-as-the-largest-generation-in-u-s-laborforce/

hbr.org/2016/05/what-millennials-want-from-a-new-job

news.gallup.com/reports/189830/e.aspx#aspnetForm

vertafore.com/resources/press-releases/82-percent-millennials-would-recommend-career-insurance

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What is the PIA/Penn National Insurance agents’ umbrella program? Written by agents for agents. ■

Comprehensive excess insurance protection

■

Packaged in one easy-to-manage policy

■

Affordable rates

Coverage

Payment Plans & Fees

Coverage limits (higher limits may be available)

Flexible payment plans for any policy

■ Up to $10 million for commercial and professional liability

■ Full payment (no installments)

■ Up to $5 million for personal exposures of owners and officers

Core Coverage ■ Business operations — broadened coverage and excess limits protection for agent/agency’s business and employees for liability incurred as a result of normal business activities. Policy provides coverage over an agency’s commercial general liability or businessowners, employers liability and commercial auto.

Key Features

Coverage features

■ Excess over underlying E&O

■ Personal injury

■ Personal umbrella coverage for owners, partners and officers, including members of their families. Sub-limit does not affect total limit.

■ Libel, slander and advertising offense

■ Employment practices liability providing excess limits on a following-form basis. Sub-limit does not affect total limit. ■ Excess over business coverage ■ Defense coverage outside policy limits ■ Affordable minimum premiums for 9 employees or fewer ■ One source for all excess coverages ■ Blanket protection for most risks ■ Flexibility to meet the needs of any agent, including flexible pay plans

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

■ First-dollar legal defense provided for claims not covered by underlying insurance ■ Professional liability — excess limits protection on a following-form basis for errors and omissions in the course of the agency’s business as an insurance professional. Coverage can be written over occurrence or claims-made forms of a variety of primary E&O carriers.

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.)

■ Two payments — 50% down, one installment of 50% due three months later ■ 40/30/30 — 40% down, two installments of 30% each due every other month ■ Quarterly — 25% down, three installments of 25% each due quarterly ■ Monthly — 20% down, five installments of 16% each due monthly

Available payment plans by premium level ■ Premium up to $1,000 — full payment or two payments ■ Premium of $1,001 to $5,000 — full payment, two payments, 40/30/30 or quarterly ■ Premium greater than $5,000 — any payment option

Applicable fees ■ Service fees: No service fee will be added to the initial payment. A $4 service fee will be added to each installment billing.

carletta clyatt Senior vice president, Omnia Group

Hiring? Consider employees from all walks of life

Look out: The face of your top-talent employee is changing. And, a new, fresh approach to hiring, managing and motivating must be adopted by insurance leaders because of this change. Many insurance recruiters still favor seasoned professionals; those listing years of experience and eager to tell engaging stories about their past business encounters. However, experience alone does not necessarily translate into a win-driven performer. I have seen leaders in the insurance industry make the expensive mistake of hiring individuals with extensive work backgrounds, but no real substance. Often these are job hoppers with years of experience who claim they frequently switched companies to feed their own desire to explore new work opportunities. What they don’t say is that they actually fell short of employers’ expectations, were terminated or otherwise forced out of their previous positions. Today’s overflowing pool of job applicants makes it possible and probably beneficial to consider not only seasoned workers, but also younger ones and those from diverse ethnic backgrounds. Younger workers can bring to you their spirit, fresh perspectives and comfort with technology, while people from other cultures potentially can build your client base, perhaps reaching out to a community of well-suited business prospects you overlooked previously. How can you encourage a broader spectrum of workers to join your agency? What are the steps you need to take to appeal to, recruit and retain a new brand of top insurance professionals? www.piatn.com

Young workers Young, energetic workers abound so it’s not so much finding them that’s a concern. Promote your agency on social-media sites and let young family members and friends know you’re hiring. It’s easy enough to find these employees. However, retaining 20- and 30-somethings often is the real challenge. Keep in mind the long-standing belief that a person will work for only one company throughout his or her career is gone. It’s extremely rare to find workers below the age of 40 who have worked for a single business since graduating high school or college. Graduates accept this trend throughout their career, so that makes them ask, “What is the company going to do for me?”

Agency E&O

has a market for your agency and specific risk

Younger workers also are very values-oriented, and they will leave companies they do not believe “walk the talk” of those values. For example, 20-something employees have been known to quit a job on the spot, while in contrast, 30-something’s may try to fight for change before quitting. The sudden departure of the youngest workers can have a real impact on a business’s operations. This often is referred to as a lack of a “values fit.”

Agency

E&O

To hedge against this, offer them some challenges, but stay accessible, as problems and questions are sure to arise. Young professionals tend to respect the words of their superiors, though it will likely take just a minimal effort to coax them into thinking on their own and assuming responsibility. They are ambitious. Developing a mutually agreed upon career path within your company often piques their interest and maintains their enthusiasm. Members of the youngest work group are more likely than seasoned workers to look for feedback regarding their performance, especially when it includes praise and recognition of their skills and talents. Most were weaned on some form of technology and adept at using cutting-edge computer software, fast-track communication and processes. They may be eager to share their has a market for your has a market for your expertise, and specific others (provided open minds) can learn from them. agency and risk they have agency and specific risk Knowing they have a voice and that they will be viewed as an equal part of the team despite their youth gives these eager workers a much-needed sense of worth, reassurance and pride.

Diversity Finding a large pool of ethnically diverse job candidates will likely prove more challenging than locating younger ones, so plan to take a highly proactive approach to your search. First, clarify your definition of diversity. Conduct a culture assessment of your existing organization or department by speaking to employees or asking them to complete anonymous surveys. Then develop a viable strategy and implementation plan for a realistic diversity initiative. Change your recruiting tactics. Incorporate not only traditional methods but new ones, such as inquiries into universities, technical schools or organizations drawing large numbers of people from different backgrounds. Be active in your community. Network with diverse local organizations and let them know you’re hiring and will offer the right individuals great opportunities within your company. Promote your agency via its website as one that sets diversity as an ongoing objective.

Establish and maintain relationships Often, it proves both challenging and insightful to find common ground with people who are not like us. Uncovering the specific expectations and typical behaviors of both young people and those of various ethnic backgrounds can help, though.

Contact Kristopher Fisher 800-875-7428

Encourage casual discussions about the cultural, generational and ethnic Contact differencesContact among your team. Sometimes, when management implements Kristopher Fisher Kristopher Fisher may get the policies to obtain and maintain a diverse workplace, employees 800-875-7428 800-875-7428 impression that asking respectful cultural or generational questions is inap-

Professional Insurance Agents magazine

propriate. However, workers benefit from learning about the different backgrounds, cultures and expectations of their co-workers. Knowing about each other helps workers avoid accidental insults and slights and fosters a community feeling.

What everybody wants Whether you manage seasoned workers, young people or employees from other cultures, you need to provide the specific means by which they all need to stay happy, challenged and productive. Keep in mind that individuals all have unique hot and cold buttons that, when triggered, elicit a positive response and help maximize performances. Management is not one-size-fits-all.

By knowing the individual needs of one person over another, you can help buy employee loyalty and satisfaction. Management tools, such as behavioral assessments, can provide easy and accurate insight into the inherent behaviors of all your subordinates. While there are many assessments on the market available, The Omnia Profile® offers a unique benchmarking feature, where individuals can be compared to one another and indications of one person’s needs over another’s are made. Additionally, these Profiles are interpreted by trained analysts—not computers— who know how to allow for the specific quirks of individuals or factors in employers’ unique needs. Replacing your top-talent investments can be expensive and timely. Be sure you’re doing all you can to employ people—whether experienced, young or culturally diverse—who are well-suited to the job, your work environment and your agency’s mission. Clyatt is a senior vice president for the Omnia Group, an international company specializing in employee selection and motivation. She is also a popular seminar speaker within the insurance industry and can be reached at (800) 525-7117, ext. 1226, or via email at carletta@ omniagroup.com.

Help Build Your Family’s Financial Future With

PIA Trust Insurance Plans INSURANCE PLANS DESIGNED WITH LOCAL AGENTS IN MIND As a PIA Member* serving Main Street America, you and your employees have access to a variety of highquality, competitively priced insurance plans. Plans available include:  Basic Term Life**  Voluntary Term Life  Dependent Term Life  Hospital Indemnity  Long Term Disability  Short Term Disability  Business Overhead Expense  Accidental Death & Dismemberment

PIA SERVICES GROUP INSURANCE FUND

*PIA National membership, when required, must be current at all times. **Only available if 100% employer paid and if the employer and 100% of the employees enroll. No medical underwriting necessary up to guaranteed issue limits.

For more information about PIA Trust Insurance Plans, please contact your local PIA Affiliate or call the Plan Administrator at 1-800-336-4759. Additional information is also available on-line at www.piatrust.com. Policies or provisions may vary or be unavailable in some states. Policies have exclusions or limitations which may affect any benefits payable. Underwritten by Unimerica Insurance Company, Portland, ME. Administered by Lockton Risk Services.

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HOW CYBER INSURANCE CAN PROTECT YOUR BUSINESS The need for cyber insurance is real. Cyber insurance protects businesses from computer, network and Internet based risks. The policy covers both first and third party loss. Every business that uses the Internet, accepts credit cards, or uses a system network needs cyber insurance. If you answer yes to any of these questions, you need a cyber insurance policy: • Does your business accept credit card payments? • Does your business bank online? • Does your business use Facebook, Twitter, or LinkedIn? • Does your business store sensitive customer or employee data? YOUR CYBER EXPOSURE

HOW OUR CYBER INSURANCE POLICY RESPONDS

SOCIAL ENGINEERING An employee is tricked into sending money to an imposter pretending to be a company manager, customer, or vendor.

Reimburses you for the money lost from a social engineering scheme.

FUNDS TRANSFER FRAUD A hacker breaks into your computer system and gains access to your online banking account. The hacker uses his access to request a funds transfer.

Covers the money lost but not reimbursed from a criminal fraudulently issuing instructions to your bank to electronically transfer funds.

RANSOMWARE An employee unknowingly opens a link in an email that Covers the ransom in excess of the deductible to unlock contains a computer virus. The virus immediately begins your files after consultation with the Insurer. encrypting files on your network. The criminals reach out to you demanding $5,000 in return for unlocking the company’s files. NETWORK INTERRUPTION A computer virus brings down your customer order system. It takes three days before technicians can get it up and running again.

Reimburses lost profits and any extra expenses incurred while systems were down after an initial 8-hour down time threshold.

DATA BREACH A hacker gets past your security controls and breaches your network. Customer data records which included sensitive personally identifiable information were stolen. However, the extent of the breach and number of records implicated is undetermined without further security review.

Covers: • Legal fees, security experts, PR consultants, notification costs, and identity theft protection for customers impacted by the breach; • PCI fines and penalties; and • Defense and settlement costs for related lawsuits.

NETWORK SECURITY Your website was hit with a virus that flooded your network Covers lawsuits brought by those customers impacted by with 10 times the normal traffic, rendering your system the virus transmissions and covers the cost to repair any inoperable. The virus was transmitted to several key customer damage to your data files. websites, bringing their systems down as well. MEDIA LIABILTY A customer posted a complaint on your Facebook page. An employee posted a reply accusing the customer of lying.

Covers content related lawsuits for defamatory and slanderous comments made by your company on its social media accounts.

PIA office (615)-771-1177

FOR MORE INFORMATION, CONTACT: advantageservices@piatn.com © ABA Insurance Services Inc. dba Cabins Insurance Services in CA, ABA Insurance Services of Kentucky Inc. in KY, and ABA Insurance Agency Inc. in MI. 092017. All coverage descriptions and claims examples are provided for informational and educational purposes only and are not a representation as to coverage for any other claim. Coverage for any claim is determined upon the specific facts of the claim, the terms and conditions of the policy and applicable law. For details on the coverage provided by your specific contract of insurance, please refer to your policy. Coverage is subject to underwriting guidelines. Limits may be capped for underwriting reasons.

All that glitters may not be covered Jewelry is a common type of personal property. Unfortunately, it also is a common source of insurance agents errors-and-omissions claims because a standard homeowners policy has limited coverage for theft of jewelry. Obtaining higher limits and broader coverage through inland marine policies, or a rider to the homeowners policy with schedules of specific items, may be the best option depending on your client’s needs. Typically, these E&O claims involve a failure to obtain coverage or inadequate limits, and a surprising number involve diamond engagement rings. Here’s some advice to remember when clients get engaged: • Be sure your client has an insurable interest in the engagement ring. • Be aware of jewelry sub-limits on the client’s homeowners policy. • Be aware of changes to the jewelry insurance during carrier changes. • Obtain higher limits and broader coverage through inland marine policies or a rider to the homeowners policy. • Proper valuation is key. Get updated appraisals from your client. • Be sure your client understands the valuation method. The most common engagement ring issues begin with lost or stolen rings while on vacation. After the loss, the customer often discovers the jewelry limit on the policy is less than the value of the item, or that his or her policy does not cover the disappearance. Issues also arise when the schedule does not list the missing jewelry. This is especially problematic when a schedule drops at the time a policy transfers to a new carrier. Proper valuation is key. Be sure to get an appraisal or bill of sale upon issuing the policy. If the policy is switching carriers or if there is not a current appraisal on file, request an updated appraisal. Since scheduled items may appreciate, an appraisal is needed to reflect any changes in value. Also, valuation methods vary by carrier and by policy. Explain to your clients how their insurance carrier will value their jewelry. After all, there may be a significant impact if it is actual cash value versus agreed value. Depending on state law, the individual who gave a ring to his or her fiancé may or may not have an insurable interest in the ring. Be sure your client has an insurable interest in the engagement ring. Issues that are even more complex can arise involving whether the giver or receiver owns an engagement ring, especially if the engagement is broken off before marriage.

www.piatn.com

E&O

dan hammond and melane humphreys, ms, cphrm Utica National

The answer varies depending on the applicable state law. If the engagement ends with a mutual agreement, the majority rule is that the owner of the ring usually is the giver of the ring. If one party calls off the engagement, some states do not examine which party is at fault, and typically, find ownership of the ring to be the giver of the ring. In other states, the party who is not at fault for ending the engagement owns the ring. If asked to insure an engagement ring, agents should consult with their carriers regarding which party’s policy the ring should be insured under based upon the applicable state interpretation of ring ownership. Agents should make sure that the customer provides a current appraisal for scheduling the value of the ring accurately. Agents may consider highlighting any exclusions, such as disappearance. If the customer declines to procure specific coverage for the ring, the agent may consider highlighting the limited coverage provided by typical homeowners policies. Hammond is the director of E&O claims and Humphreys, MS, CPHRM, is the casualty risk management specialist at Utica National.

2018 PIA of Tennessee Convention Join us for the Annual Convention inÂ Memphis,TN June 28th-29th. To make your stay memorable and beneficial there will be many fun activities, opportunities for professional development/CE, and networking. Register and reserve your hotel TODAY atÂ www.PIATNconvention.com

Location The Guest House at Graceland celebrates Elvis Presley and his legacy. It is the most significant enhancement to Graceland since it opened to the public in 1982.

Trade Show The trade show's theme this year will encompass "The King" himself. With door prizes to agents and exhibitors, this will be an event you won't want to miss.

Networking Meet local Main Street America agents from all across the state. Find out what they're doing to grow their agencies.

Golf The Golf Tournament will be hosted Friday afternoon, June 29th, and benefit a local Memphis charity.

Professional Development The 2018 PIATN Convention will host great speakers who are nationally known and provide the opportunity to earn CE credit.

Social Events There will be multiple opportunities throughout the conference to socialize, such as the Welcome Reception, Presidents' Dinner, and others.

What not to ask during an interview There was a time—before I was your favorite PIA government affairs counsel—when I was a naïve job searcher fresh out of undergraduate school. Eager to find my place in the workforce, I never gave a second thought to the questions I was asked as a prospective employee. After law school, I am (a little) smarter now. However, I still remember when, as an undergrad, I interviewed at an out-of-town business. During the interview, I casually told the interviewer I wanted to relocate to move in with my then boyfriend. The interviewer said, “That’s great! Are you two planning to get married? This area has some great wedding venues.” She was being nice and conversational, and, being an enthusiastic job seeker, I answered her. Her question is something I look back on and cringe. While the question seemed harmless and was a follow up to something I said, it was illegal for her to ask about my impending nuptials. Title VII of the Civil Rights Act of 1964 is a federal law that prohibits employers from discriminating against employees based on sex, race, color, national origin and religion. Through the years and various other legislative acts, those protected classes have expanded to include age, disability, marital or family status, pregnancy, and most recently salary history. While the federal statute applies to employers of 15 or more employees, many states, and even some cities and counties have granted further protections to employees and prospective employees. As a business owner, you have most likely had the opportunity to interview potential employees for positions within your agency. It is important to know which questions you should avoid during an interview to prevent the possibly of discriminatory hiring practices. Think back to some of your prior interviews and try to remember if you have ever asked this question, whether formally or during conversation: “Do you have children?” What about: “What does your husband/wife do for a living?” Did you ever have a conversation with a job applicant in which he or she offered up information as I did? Would you have followed up the statement with my interviewer’s same question? Now that I have you thinking, here is the crux of the matter: What questions should you stay away from during an interview and what questions are appropriate to determine whether an applicant is qualified for the position and a good fit for the company’s culture? To help you prepare for your next round of interviews, here are some helpful hints on what questions to avoid and what you should ask instead.

www.piatn.com

Children/family

staffing

sarah coli, esq. Government affairs counsel, PIA Management Services

Avoid asking the interviewees: how old their children are; how many children they have; if they plan on having children; the grade level of their children; who takes care of the children while they are at work; etc. Even if the applicant has shared information about having children, there is no need for a prospective employer to ask these types of follow-up questions as they could be used as evidence of discrimination on the basis of family status should the applicant not be hired. Also avoid questions about whether the interviewee is married; planning to get married; or pregnant; etc. You should never ask an interviewee what his or her spouse does for a living. Do not ask if a woman prefers to be addressed as Miss., Ms. or Mrs., or her maiden name. These questions imply an illegal motive to hire an applicant who will not require time off for a wedding, child birth or care or other family-related needs. However, an employer can answer questions that an applicant asks. For example, if an applicant asks about a flexible work schedule and explains that he needs one because he is a single father of three, then the employer can answer his question regarding the schedule. The

employer should not pursue the topic further once the question has been answered. An employer also may ask applicants whether they have commitments that preclude them from meeting the regular job schedule. Questions like this must be asked of all applicants, and used to determine if the applicant can meet a requirement of the job (i.e., to be present during the hours necessary for the position).

Religion When interviewing applicants, you should avoid questions regarding religious affiliations. This includes questions such as: Will you need time off for particular holidays?; Do you celebrate Christmas?; etc. Furthermore, the employer should not tell an applicant that this is a [religious] organization. An employer also should be wary during casual conversation with an applicant not to cross over into gray areas, such as asking what organizations or groups the applicant belongs to outside of work. This could be construed as an employer attempting to determine religion, race, nationality or disability.

Age This is a rather new category protected under discrimination laws, so employers may still be asking questions that will reveal applicants’ age, including asking their date of birth on employment applications. Employers should avoid questions that ask what year an applicant graduated from high school; how long applicants’ plan to work before they retire; etc. Any questions that would determine an applicant’s age are forbidden. However, an employer may ask a general question, such as: “Are you 18 years of age or older?,” since it is not aimed at determining the actual age of the applicant.

Race/national origin Racial discrimination occurs when individuals are subjected to unequal treatment because of their actual or perceived race. National-origin discrimination treats applicants unfavorably because they are from a particular country or part of the world; because of ethnicity or accent; or because they appear to be of a certain ethnic background. Remember that, when it comes to race or national origin, applicants can argue that they were denied employment based on the employer’s perception that they are a specific race or nationality, whether they are or not. To protect themselves from this implication, employers cannot ask about the applicants’ country of origin; where they grow up; their parents’ nationality; their skin color/complexion; etc. Even casual conversations may be a fine line. As an employer, you cannot comment on an applicant’s accent or ask about an accent’s origin, even though that may be a natural conversation starter.

Professional Insurance Agents magazine

Disability As an employer, you must balance deciphering whether an individual is able to complete the main functions of the position with protections regarding any disabilities the applicant may have. For example, an employer cannot ask an applicant how he or she got a mark/scar/ limp or if he or she has any physical or mental impairment that would interfere with job performance. However, employers are able to say, “This position requires long periods of standing and the ability to lift up to 15 pounds unassisted. Are you able to perform these tasks?” Furthermore, an employer cannot ask applicants if they have a drug or alcohol problem or if they suffer from a disease.

Salary history While Tennessee does not have a state ban on asking applicants about their salary history, it is a best practice for employers to avoid this question and instead ask applicants about their desired salary range. Recent trends have seen states, counties and municipalities implement bans on asking applicants about their salary history. So, Tennessee’s stance on this question could change in the future. Coli is PIA Management Services’ government affairs counsel.

2018 Partners

from the people stronger

who

customer satisfaction

know.

stronger

coverage

stronger

loss control

stronger

defense

TENNESSEE

Continuous E&O protection since 1966.

504 Autumn Springs Court Suite A-3 • Franklin, TN 37067 Phone: 615-771-1177 • Fax: 615-771-3456 Contact: Kristopher Fisher, kfisher@piatn.com Visit: www.piatn.com