kia&b july/august 2012

July/August 2012

Kansas Insurance Agent & Broker

KAIA Management Conference

Wichita Branch: 800.223.0562 | Home Office: Des Moines, IA www.emcins.com

© Copyright Employers Mutual Casualty Company 2011 All rights reserved

I’m celebrating our 100th year by planning for our next 100 years.

Jason Bogart, CPCU, ARM, Vice President of Branch Operations

Our future will be marked by the relationships we forge with you—the independent insurance agents who represent us. You’re the reason we’ll continue to investigate new market opportunities. Why we’ll develop competitive products. Why we’ll maximize the use of new technologies. Why we’ll emphasize ongoing professional development for our staff. By helping you profitably and efficiently grow your agency, EMC Insurance Companies will continue to serve you and your customers today and well into the future.

The bimonthly magazine of theKansas Association of Insurance Agents

EDITOR Rebecca Spriggs

O F F I C E R S O F K A I A

PresidentLee Hays | [email protected]

President ElectTim Tyner | [email protected]

Vice President/TreasurerBob Wood | [email protected]

Secretary/Assistant TreasurerSueAnn Schultz | [email protected]

State National DirectorGreg Renn | [email protected]

Immediate Past PresidentMark Lowry | [email protected]

B O A R D O F D I R E C T O R S

Zone I DirectorJim Wilkinson | [email protected]

Zone II DirectorRob Lessen | [email protected]

Zone III DirectorLyle Davidson | [email protected]

Zone IV DirectorLee Gleason | [email protected]

Zone V DirectorLonny Claycamp | [email protected]

Zone VI DirectorScott Strong | [email protected]

Director at LargeJim Runnebaum | [email protected]

Director at LargeRon Bolz | [email protected]

Director at LargeKristi Wilson | [email protected]

Director at LargeDusty Davis | [email protected]

YAC ChairpersonJo Erin Stuteville | [email protected]

K A I A P R O F E S S I O N A L S T A F F

Executive Director | Kerri Spielman

Vice President of Operations | Marcia Moore

Director of Communications | Rebecca Spriggs

Director of Agency Operations | Bob Harris

Membership Services Rep | Deanna Dinwiddie

Insurance Services Rep | Amanda Hanson

Insurance Services Team Leader | Lisa Parkhurst

Public Relations Coordinator | Katie Hobson

Accounting & Finance Assistant | Debby Cowan

Insurance Services Rep | Kim Deever

815 SW Topeka Boulevard | Topeka, KS 66612(785) 232-0561 | (800) 229-7048

w w w . k a i a . c o m

TABLE OF CONTENTS

d e pa r t m e n t sPresident’s Message 2

Industry Partner Programs 3

Agents Council For Technology 4

Commissioner’s Column 7

Young Agents Committee 8

Trusted Choice Committee 10

Technology Committee 11

Education Classes 30

Advertising Index 31

Kansas Filings of Interest 33

FEATURES12

COVER STORY

KAIA Management Conference

16

Where’s the Fire

20

Trusted Choice Big I Junior

Golf Tournament

22

KAIA Awards

23

OCSR of the Year

24

Aff ordable Care Act

July/August 2012Vol. 17, No. 4

POSTMASTER: Send address changes to Kansas Insurance Agent & Broker c/o the Kansas Association of Insurance Agents, 815 SW Topeka Blvd., Topeka, KS 66612. (785) 232-0561.

Kansas Insurance Agent & Broker (ISSN#1069-1847) is published bimonthly by Agency Services Corporation of Kansas (ASCK) a subsidiary of the Kansas Association of Insurance Agents, 815 SW Topeka Blvd., Topeka, KS. (785) 232-0561. Periodicals postage paid at Topeka, KS 66612.

The Kansas Association of Insurance Agents was formed September 1, 1992, through the combination of the Profes-sional Insurance Agents of Kansas (PIAK) and the Independent Insurance Agents of Kansas (IIAK). The Association was formerly affi liated with the National Association of Professional Insurance Agents (PIA) and is currently affi liated with the Independent Insurance Agents and Brokers of America (IIABA).

K A N S A S I N S U R A N C E A G E N T & B R O K E R

12

18

16

2 KANSAS INSURANCE AGENT & BROKER :: July/August 2012

PRESIDENT’S PAGE

The Big question facing agents across the country, according to ACT’s Agencies of the Future workgroup is, “how do I demon-strate my agency’s value proposition?” The market is hardening albeit slowly, and with the healthcare changes and uncertainty with the Farm Bill, many agents are looking to diversify and recruit new clientele.

Build Your Brand One Wish at a Time

I’ ve got two words for you: Trusted Choice®. I under-stand that many of you are still on the fence about co-branding. Perhaps you have signed the licensee

agreement, but you haven’t actually taken the plunge into “liv-ing the brand.” Your brand is your story. How do you stand out from your competitors if consumers don’t connect that your value is in being an independent agency? With the IIABA’s Make-A-Wish campaign, and the consumer agent portal under construction through Project CAP, the timing for involvement is ripe.

Last summer, Trusted Choice® raised $170,000 for Make-A-Wish Foundation and helped grant eleven children wishes with their social campaign to gain likes on their Facebook Page. This year, the campaign is designed to help build engage-ment on the page. For every post that is shared directly from www.facebook.com/TrustedChoice, Trusted Choice® will give $10 to Make-A-Wish, up to $150,000.

The campaign will also serve as the launch of a year-long fundraising effort involving the Trusted Choice® “Chopper for Charity.” Recently, a Trusted Choice®-themed custom motorcycle designed by the re-nowned Orange County Choppers to raise money for Make-A-Wish was unveiled by Paul “Paul Sr.” Teutul, Sr., Orange County Choppers owner and “American Chopper” star. The bike will be on display at this year’s Larry Magill Rural & Small Agent’s Conference in Junction City, Jan. 29-31.

The combination of the two campaigns will not only gen-erate more awareness of the independent insurance industry, but more importantly, they will highlight our value in being people-centric. Moreover, once construction is fi nished, the consumer agent portal will serve as the funnel for consumers to fi nd independent insurance agents in their area.

Project CAP is a marketing strategy to help independent insurance agents recapture the personal lines market share.

IIABA members, or rather, Trusted Choice® agents have the advantage in that they will automatically be included in the portal, similarly to the way that they are included in the Trusted Choice® Find an Agent tool at www.trustedchoice.com. The portal will help prospects narrow down their insurance needs and preferences, thereby creating rather solid leads for agencies involved in the portal. Of course it will be the agency’s responsibil-ity to maintain their profi le, just as it is with the current Find an Agent tool.

The IIABA is providing strategic opportunity for inde-pendent agencies to position

themselves in the market place as the best way to purchase insurance. Make sure you are part of the game. Get involved now by signing the Trusted Choice® licensee agreement and begin co-branding your agency with Trusted Choice® today.

LEE HAYS, LUTC, CSA KAIA President

3July/August 2012 :: KANSAS INSURANCE AGENT & BROKER

INDUSTRY PARTNERSHIP

The Industry Partnership Program was initiated by the KAIA Board of Directors to give company partners greater recognition and more options in a single annual sponsorship. Our tiered program allows partners to decide which level of sponsorship is most appropriate. This one-time solicitation allows maximum exposure to the KAIA membership throughout the entire year at our most popular events. This year’s revamped program offers many benefi ts that were not included before: paid membership dues, priority selection of booth place-ment at the Rural & Small Conference, special recognition on the online event registration pages and event/education registration packets.

2012 Industry Partnership Program

D I A M O N D S P O N S O R S

GOLD SPONSORS SILVER SPONSORS

Accident Fund InsuranceCompany of America and United Heartland

NSI/West Bend Mutual

Progressive Insurance

Allied InsuranceAmerica First InsuranceColumbia Insurance GroupContinental WesternFarmers AllianceKansas Mutual Insurance Company

BRONZE SPONSORS

ACUITYAllstate InsuranceAMERISAFEARMTech InsuranceAuto-Owners InsuranceBremen Farmers Mutual Insurance CompanyBuckeye Insurance GroupCapital Premium FinanceMarysville Mutual Insurance CompanyMetLifeMid-Continent GroupM.J. KellyRain & Hail, LLCState AutoTAS InsuranceUpland Mutual Insurance, Inc.

American Heritage Agency, Inc

Hays, KS

KAIA NEW MEMBER


TECHNOLOGY UPDATE

Agents are being increasingly asked by their E&O underwriters whether they encrypt their clients’ personal data when it is being transmitted. This article provides recommendations with regard to two major areas agen-cies need to address – secure email and securing their websites when personal data is requested. The article also discusses “encryption” and major types of “personal data” that are the subject of the various laws. Finally, the article outlines the type of resources that are available on the ACT website to help agencies address the email and website issues, as well as to develop and implement a comprehensive agency information security policy and program for their agency.

Agency Strategies to Send & Receive Personal Data Securely

T he Internet and mobility revolutions have enabled agents and their clients to live

in an electronic world where the par-ties can work and communicate with each other from anywhere, opening up wonderful new opportunities for agen-

cies to reach out to new consumers and provide their clients with enhanced services and responsiveness. These developments, however, have multi-plied the security risks that agencies must manage in order to protect their clients’ personal data.

It is no wonder then that E&O underwriters extending coverage for data breach to agencies increasingly are asking their applicants whether they encrypt or use other protective mea-sures to safeguard this client personal data when it is being transmitted. This

By Jeff yates


article explores approaches agencies can take to protect personal data in transit and then references a number of resources to assist agencies.

EncryptionA common question agents ask is:

“what is encryption?” When you think of encryption consider those codes the military employs to keep conversations unintelligible to the enemy. You can fi nd many defi nitions of encryption on the Internet, but I like this simple one from Microsoft:

Encryption is a way to enhance the security of a message or fi le by scram-bling the contents so that it can be read only by someone who has the right encryption key to unscramble it. For example, if you purchase something from a website, the information for the transaction (such as your address, phone number, and credit card num-ber) is usually encrypted to help keep it safe. Use encryption when you want a strong level of protection for your information.

Requiring a strong password to gain access to your system is an impor-tant security procedure, but it is not the same as encrypting the data within the system.

Personal DataWhat are the types of “personal

data” that are most sensitive and need to be encrypted when transmitted? The defi nition of “personal data” can vary by state and is contained in the state data breach notifi cation and privacy laws, as well as in various federal laws, such as HIPAA (PHI – Protected Health Information). Insurers, too, might employ various defi nitions of “personal data” in their policies, so it is incumbent upon the agency to be familiar with not only the specifi c laws but also the coverage defi nitions that apply to the agency. Note also that

the applicable state law is based upon the residency of the individual whose personal data is being protected, not the location of the agency. This is an important consideration for both agen-cies writing business in multiple states and agencies writing policies that cover individuals who reside in multiple states.

With all of the above caveats, the most commonly mentioned types of non-public, individually identifi -able “personal data” covered in the laws are those such as: social security numbers, driver’s license numbers and other government issued ids, debit and credit card numbers and pins, bank and fi nancial account numbers, and protected health in-formation (PHI under HIPAA). While often not mentioned in state laws, other particularly sensitive personal data that should be protect-ed includes informa-tion commonly used for security verifi cation (mother’s maiden name, date & place of birth, etc.) or sensitive insurance informa-tion (such as jewelry schedules).

It is important for agencies to know what types of personal in-formation they collect, where it is retained and who has access to it. They then need to decide whether they really need to keep this sensitive information. For example, many agencies no longer retain copies of bank checks and are care-ful only to pass along

credit card numbers to carriers, but not to retain them, so that they do not be-come subject to the comprehensive PCI (Payment Card Industry) compliance requirements. These agencies are also extremely careful to shred this personal data as soon as it is no longer needed.

Further, if the agency decides it must keep particular sensitive personal data, it should limit access to it to only those employees who need to see it, to maximum extent possible. This is particularly true for Protected Health Information. Finally, the agency should

continued on page 26 »


FROM THE COMMISSIONER

SANDY PRAEGER Kansas Insurance

Commissioner

The 2012 session of the Kansas Legislature saw the passage of four bills that the Kansas Insurance Department sought and ap-proved, with fi ve others shelved for future sessions. Following is a summary of the approved bills, along with their effective dates.

2012 Legislative Session

B 264 – Allowing trust com-

panies as nominees for life

insurance companies

SB 264 amends K.S.A. 40-2b20 to allow life insurance companies to use trust companies to manage their invest-ments. A similar bill, 2011 Law (SB 185) was passed last session; it allowed companies other than life companies to use trust companies to manage invest-ments. SB 264 was enacted to extend the same opportunity to life insurance companies.

Effective: Upon publication in the stat-ute book (July 1, 2012).

SB 266 – Risk-Based Capital (RBC)

Requirements

SB 266 changes the version of the National Association of Insurance Com-missioners (NAIC) risked-based capital instructions applicable under Kansas law from those in effect on December 31, 2010, to those in effect on Decem-ber 31, 2011 (K.S.A. 40-2c01). This ef-fectively updates the RBC rules the de-partment follows and aligns them with those most recently set by the NAIC.


HB 2486 – Changing the frequency

of examinations for HMOs and Medi-

care provider organizations

HB 2486 increases from 3 to 5 years the minimum time period within which the department must examine each HMO or Medicare provider (K.S.A. 40-3211). Other insurance companies

are examined a minimum of once every fi ve years as well.


SB 273 – Fees for examination of

insurance company

SB 273 amends K.S.A. 40-223, which concerns the amount an insur-ance company or society must pay for outside consulting and data processing fees necessary to perform an examina-tion. “Outside” refers to work con-tracted by the insurance department when additional support or expertise is needed to complete a fi nancial condi-tion examination. Under previous law, the amount a company had to pay for outside exam fees and expenses was capped at $25,000 per exam for all types of exams.

S The amendment establishes a “small cap” and a “large cap” for the amount paid for outside exam fees and expenses, based on a scale of the gross premiums of the company. The amount paid can’t total more than $100,000.

Effective: Upon publication in the statute book (July 1, 2012).

Bills that KID sought but did not

pass this session are listed below.

Sub SB 71 – Insurance agents; ad-ditional lines; fi ngerprinting and crimi-nal history records check requirements; HB 2485 – Requiring insurers to submit antifraud plan and affi x warnings to all

General Liability, Automobile, Umbrella, Inland Marine, Surety and Surplus Lines



YOUNG AGENTS COMMITTEE

ROSS HENDRICKSON YAC Representative

agents. The things a young agent brings to the table are new, exciting, and probably out of the box. The young

agent’s ideas are not to defy the seasoned veteran but to compliment that style and build on marketing to a younger generation.

Last month I had a realiza-tion. As I was

listening to Katie Hobson of the KAIA talk about social media and all of these amazing ways to communicate with clients it hit me… I’ve never tweeted and still have no idea what QR stands for. I am now the “old school” agent listening to the me of eight years ago. I’m not sure if it’s a sign of how quickly technology changes or what, but suddenly I’m wondering how I can be considered a young agent!? Apparently the saying is true, time really does fl y by.

Mingle “old school” Selling

M y sales tactic would be internet, email, Google searches, etc.. His tactics included cold call-ing, telemarketing and mail-

ings. “Oh my,” I thought. This should be interesting.

It was eight years ago that he and I had that conversation and it’s amazing how much we have learned from each other since then. My hesitation to pick up the phone has subsided and I think he’s capable of a Google search now.

In our agency we’ve managed to mingle “old school” selling with Face-book and email. While no one method is better than another, it is defi nitely true that a young agent is more likely to text than call or email rather than send a letter in the mail. The beauty of these very different methods is that there are still plenty of customers to go around! There are still a large number of clients that want a phone call or mail in the mail box but on the fl ip side there is a growing number of clients that want mail in their INBOX, not their mailbox!

To make the happy balance of young and… not so young, we can’t overlook the value of young

From the day I started working in the agency my boss and I have had different ideas about how to sell insurance.

JO ERIN STUTEVILLE, CISR YAC Representative


We are the WorkSafe People

rkSafe WorkSafe W

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United Heartland is the marketing name of United Wisconsin Insurance Company and is underwritten by the insurance companies of Accident Fund Holdings, Inc.

PROUD SUPPORTER OF Kansas Association of Insurance Agents


TRUSTED CHOICE COMMITTEE

JIM RUNNEBAUM Trusted Choice

Committee Chair

Pride & Producers

Wouldn’t it be great if you didn’t have to wait until events like Rural & Small to get in touch with a large group of

other agents – if you could just reach out to mentors and colleagues at will with new ideas or questions about the best way to go about certain processes? What if it already exists?

It is a truth universally acknowl-edged that a producer in want of a professional reputation should not be frequenting social clouds. Bogus. The number above that at fi rst glance appears to be a misprint and is still plaguing your mind as to the relevance of its presence does serve a purpose. It represents the number of agents, brokers and other independent insur-ance industry representatives who are actively seeking perspective and answers through Insurance Journal’s Linked In Group.

I can honestly say that I have never been in a situation in which I could speak liberally in front of fi fteen thou-sand people and have them listen too. What is it that holds you back from tak-ing advantage of your digital resourc-es? Is it pride, or perhaps vanity?

“Pride is a very common failing, I believe. By all that I have ever read, I am convinced that it is very common indeed, that human nature is particularly prone to it, and that there are very few of us who do not cherish a feeling of self-complacency on the score of some quality or other, real or

imaginary. Vanity and pride are different things, though the words are often used syn-onymously. A person may be proud without being vain. Pride relates to our opinion of ourselves, vanity to what we would have others think of us.”

–Pride & Prejudice, Jane Austen

Maybe connecting with clients through social spaces is not really your thing. Your rotary telephone could be all that you need to keep you in touch. Yet ignoring the digital tools at your disposal could be keeping your agency from excelling.

The Trusted Choice® Pledge of Performance holds us to a commitment to quality service – a very broad term with major implications. Everything from effi cient processing to compe-tence, courtesy, security, communica-tion, responsiveness, accessibility, etc., tie into quality service. What better way to improve these areas in your offi ce than from the advice and experience of other agents?

Unlike other social tools, Linked In is considered a business to busi-ness [B2B] platform. It is specifi cally designed to enable you to network better with colleagues and industry professionals. Think of it as an on-going conference online. You can have discussions about relevant topics, post job-openings, fi nd new talent, update colleagues about products and services, and effectively manage your brand.

Below are QRCs (Quick Read Codes) that link to some popular discussions among agents in various in-surance Linked In groups. Check them out and start connecting today.

“It is very often nothing but our own vanity that deceives us.” –Pride & Prejudice, Jane Austen

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TECHNOLOGY COMMITTEE

LYLE DAVIDSON Technology

Committee Chair

hat’s your story? What makes your agency stand out from the direct writer in the offi ce right next to yours? I was reading a blog post from Seth Godin this

morning. He included a video interview he did in which he calls out marketers for becoming selfi sh in their ap-proach to consumers. The hard truth is that “no one owes you their attention. No one owes you their business,” says Godin.

Godin goes on to point out that we need to tell our story in such a way that the consumer is going to resonate with us. Sweet. How?

Two years ago I attended Steve Anderson’s Agency Boot Camp. He shared a story about an agent in Cedar-town, GA, with incredible online sales. Chris Beeler put together a simple website that highlighted the main inter-actions he wanted customers to have. At the top of every page, three buttons dominate the screen: Get An Auto Quote, Make A Payment, and Get Proof of Auto Insur-ance: As Low as $59 Down. The buttons even beep when you roll your cursor over them, drawing more attention to what the page wants from viewers.

It’s not the most attractive site on the web; but it ef-fectively opened up Beeler’s market and increased his sales astronomically. The good fortune only continued when he applied the same principles to his Facebook Page. He has 282 likes and all kinds of interactions. On May 4, a client left a post “Hey Chris, can you call me back about the house ins quote? Hope all is well!”

Can you imagine? I was immediately captivated, so much so that I’ve modeled the functions of my own web-site after Beeler Insurance. I’m not big on the social media craze, but I’d kill for the kind of interaction he’s getting. How does he maintain that kind of synergy?

According to Godin, it’s in the way that Beeler is pre-senting his story. Beeler doesn’t toss out boring stats. He is constantly interacting with his community and then talking about it and applying insurance knowledge in applicable situations. He uses humor, photos, videos to entice his audience. Most importantly, he is honest. He shares how his knowledge drives in new clientele, and they acknowledge his service publicly. If you go to his website and click on reviews, you get pages and pages of praises to Beeler Insurance. Heck, I want to buy from him. It’s the relationships he is building that are continuing to bring in the business.

You doubt whether digital tools can really bring in sales for small business owners? Beeler Insurance has three employees, only two of which are licensed. Of the two, Chris Beeler is the only one really producing according to his web-site. Cedartown’s population is under 9,500 people, yet it is Beeler’s website and Facebook Page that are driving traffi c to his door, not an ad in the phonebook.

If you aren’t connected yet, I would encourage you to start simply and pick one tool. In fact, you may even just want to start with a mobile site or mobile app. With more and more smartphones out all the time, you’re bound to get great exposure. If you have a website, choose a digital tool that will help you to build and strengthen relationships like a blog, or Facebook, or Twitter. Whatever you choose, stick with it, and be consistent. Most importantly, tell your story, and tell it honestly. Show people why they should pick your story.

Want to get more help? Your Kansas Association of Insurance Agents has staff ready and willing to assist. Just email [email protected] and a KAIA staff person will be happy to assist.

Storytelling = Tales

With two kids, I have had to become a great storyteller. There are the bedtime stories, the reenactment stories for everyone just dying to know the latest adorable thing my kid has done, stories to explain why we do certain things the way we do them, and of course stories about why eating your vegetables really is a good idea.

W

== TTTTTTaaaaaalllllleeeeeessssssSales


Step out of the virtual world for a few days and into the #1 in-person networking event for leaders like you in the insurance industry.

LeadersInspiring

Leaders

October 3-5Marriott Hotel Overland Park

Featuring a bonus Young Agents Track

13July/August 2012 :: KANSAS INSURANCE AGENT & BROKER 13July/August 2012 :: KANSAS INSURANCE AGENT & BROKER

Wednesday, October 3 10 a.m. Golf Tournament at Falcon Ridge Golf Club- 10:00 am Registration,

11:00 am Shotgun start (optional event)

11 - 5 p.m. Sam Bennett, E&O- Boxed lunch included (optional event)

6 - 7:30 p.m. Welcoming Reception at the Overland Park Marriott Hotel 7:30 p.m. Young Agents Dinner (Young Agents Only) Nikko Japanese Restaurant

Th ursday, October 4 7:30 - 8:30 a.m. Breakfast 7:30 - 8:45 a.m. Private Breakfast with Coach Cliff Rovelto $250 donation to Insurpac required, call KAIA for a reservation, limited space.

9 - 9:50 a.m. Keynote Speaker, Coach Cliff Rovelto- Creating an Olympic Team

10-11:50 a.m. Management Breakout Jeff Lanza, Retired FBI Agent- Cyber Security, Identity Th eft and Social Media: Staying Safe in a New Era of Communication

10-11:50 a.m. Young Agent Breakout Bob Harris, Dir. of Agency Operations- Strategic Sales Training

noon - 1 p.m. Lunch 1:15 - 4 p.m. Management Breakout Tim Richardson, Author, Professional Speaker- Get Rich with Tim

1:15 - 4 p.m. Young Agent Breakout Sam Bennett, Th e Harrison Agency- Living in the Dash

6 - 7 p.m. President’s Reception, all attendees are invited to honor incoming President Tim Tyner

7 - 10 p.m. Leadership Banquet- Leaders Inspiring Leaders, Featuring Offi cer Installation, Industry Awards and special guest speaker, Coach Bill Self

Friday, October 5 7:30 - 8:30 a.m. Breakfast 8:30 - 11 a.m. Eggs and Issues Panel Discussion CAP Leveling the Playing Field and Winning with the Big “I”

Management Breakouts Young Agent Breakouts

Th is conference is specially tailored for Agency Owners and Principals

with a special track for Young Agents.

Register Online at www.kaia.com

14 KANSAS INSURANCE AGENT & BROKER :: July/August 201214 KANSAS INSURANCE AGENT & BROKER :: July/August 2012

Bill SelfMen’s Basketball Coach at the University of KansasBill Self is the head men’s basketball coach at the University of Kansas where he led the Jayhawks to the 2011-2012 NCAA tournament fi nal and the 2007-2008 NCAA national championship. Since becoming head coach of the University of Kansas Men’s Basketball team in 2003, Bill Self has guided the Jayhawks to eight straight Big 12 championships and into the NCAA tournament nine straight seasons, including a national championship in 2008 and fi ve trips to the regional fi nals or beyond. He owns an impressive 269-52 record at the school and a 476-157 overall career record.Self has sent 17 Kansas players to the NBA and has produced 25 Academic All-Big 12 selections. In March 2012 he received the Naismith Coach of the Year Award, the most prestigious national award presented annually to the top men’s college basketball coach.

Cliff RoveltoDirector of Cross Country and Track & Field at Kansas State University K-State Head Coach Cliff Rovelto has established himself as one of the top coaches in not only the nation but the world when it comes to track and fi eld. Under the direction of Coach Rovelto, the Kansas State track and fi eld program has established itself as a force in America’s heartland and regularly challenges some of the more established collegiate programs in the nation. Rovelto begins his 21st season as the head coach at Kansas State and his 25th at the school overall. Th e steady progression of the K-State program culminated in 2001 with Rovelto being honored by his peers as the women’s outdoor National Coach of the Year by the U.S. Track Coaches Association.

Cliff Rovelto is the personal coach of three Olympic high jumpers representing the United States. Two-time NCAA champion Erik Kynard, reigning world champion Jesse Williams, and the oldest American man to ever qualify for the Olympics in the high jump Jamie Nieto.

Golf Tournament, Falcon Ridge Golf Club (optional event)10 am registration, 11 am shotgun start Enjoy 18 holes of golf, a boxed lunch and catch up with your fellow agents on a course that is known for its bent grass greens. Falcon Ridge Golf Club is nationally recognized as one of the best public golf courses in the Midwest.

E&O Class- E&O Class only registration is available, see registration form. (optional event)Th is class qualifi es for 10% Westport premium credit for three years IF agency staff attendance requirements are met for this 6 Hour Seminar. Boxed lunch is included in the registration fee.

Private Breakfast with Coach RoveltoJoin Coach Rovelto at a private breakfast. Space is limited to the ten outstanding individuals who commit a $250 minimum donation to InsurPAC. Proceeds from InsurPAC are used to support elected legislators in the US Congress who share the philosophies of independent agents and brokers across the country. Call KAIA (800-229-7048) to reserve your spot today and let your voice be heard.

Optional Events

Featured Guest Speakers

“If you are not getting better, you are getting worse”- Coach Bill Self

“Th e approach is the most important aspect in establishing a consistent and reliable technique” - Coach Cliff Revelto

15July/August 2012 :: KANSAS INSURANCE AGENT & BROKER 15July/August 2012 :: KANSAS INSURANCE AGENT & BROKER

Jeff Lanza, Retired FBI AgentCyber Security, Identity Th eft and Social Media: Staying Safe in a New Era of CommunicationJeff was an FBI Special Agent for over 20 years. He investigated corruption, fraud, organized crime, cyber crime, human traffi cking and terrorism. He appears regularly on the Fox News Channel and has informed the public on other national programs including the Today Show, Good Morning America, Dateline and Larry King Live, among others.

Tim Richardson, Author, Certifi ed Speaking Professional Get Rich with TimTim has worked with a number of insurance companies including American Family Life, Blue Cross/Blue Shield, CUNA Mutual, CIGNA, Protective Life, Prudential, and State Farm Insurance, where he has presented over twenty-fi ve times.

Sam Bennett, CIC, Harrison Agency Living in the DashSam is an active retail producer, presenter, and partner in Harrison Agency, Inc. of Columbia, MO. He has taught coursework for the National Alliance in their CISR program since 2000, has presented in their CIC program since 2004, and in 2009 became a National Faculty Member of the Society of CIC.

Bob Harris, AScK Director of Agency Operations Strategic Sales TrainingBob began his insurance career over four decades ago in south Florida. He relocated to Kansas in 1986, and over the years he has gained valuable experience with national companies including Allstate, Hartford and CNA where he was responsible for the hiring, training, managing and development of a number of sales people. Bob is now the Director of Agency Operations for Agency Services Company of Kansas (AScK), a subsidiary of the Kansas Association of Insurance Agents.

President’s Reception and Leadership Banquet Leaders Inspiring LeadersTh is formal reception and banquet honors the leaders and most infl uental people in our industry and beyond. Th is elegant evening begins with a reception honoring incoming KAIA President Tim Tyner. Th is year the Leadership Banquet features a special guest speaker- KU Men’s Basketball Coach, Bill Self. Offi cer Installation, KAIA Past Presidents and Industry Awards along with a fabulous dinner round out this special evening. Th e President’s Reception and Leadership Banquet, are black tie optional- men wear a tuxedo or dark suit; women wear evening gowns or cocktail dresses.

Eggs and Issues DiscussionCAP Leveling the Playing Field and Winning the Game with the Big “I” Join Big “I” Vice Chair, Tom Minkler, CIC and Marty Agather with Entrepreneurial Advantage to learn why Project CAP gives you a chance to win locally by competing nationally. In keeping with tradition, this session features a lively discussion of how today’s digital consumer is aff ecting the insurance industry. What’s in it for you? Our consumers have changed the game, now our playbook must also change.

Signature Events

Conference Speakers

Register Online at www.kaia.com


I. Getting started -the application It has become increasingly common for

carriers to attempt to avoid covering a

loss when they determine that the risk

as represented on the application is

materially different from the actual risk

insured.. In some states, the misrepresen-

tation on the application does not even

have to be related to the ultimate cause

of loss for the carrier to deny the claim

After an uncovered loss occurs and

the customer brings suit against the

agent, typically they will testify that they

gave the correct information to the

agent who then incorrectly fi lled in the

blanks on the application. The poli-

cyholder may go on to say he did not

have a chance to review the informa-

tion and relied on the agent to cor-

rectly complete the application.

and void the policy ab initio (back to

the beginning). And if that happens,

where’s the fi rst place your customer

will look to have that loss covered?

Hint: go look in the mirror. Faced with

an uncovered loss, the policyholder

may begin to focus on the agent in

an attempt to shift blame and recover

any damages. Therefore, it is essential

to submit accurate information on

the application for insurance to avoid

potential E&O liability.

Avoiding E&O claims from fire

losses

Every fire loss claim covered by an insurance policy begins and sometimes ends with the agent who sold the policy. However, avoiding an E&O claim related to a fire loss begins and always ends with you understanding the process. Remember, the fire loss doesn’t start with the fire, it starts with the application.

By ED BARBOSA, JD, Assistant Vice President, Swiss Re

“Where’s the fire?”


Lesson One: NEVER fi ll out an application for a cus-

tomer. ALWAYS make sure THEY complete and sign the ap-

plication themselves. Other claims arise when the policyholder

alleges that he told the agent the correct information but the

agent specifi cally advised that the information did not need to

be disclosed on the application. These

situations typically descend into a

scenario where it is one person’s word

against another.

Lesson Two: NEVER advise a cus-

tomer that information should not be

put on an application. When in doubt,

write it down. Matters become worse if

the customer testifi es that even though

the application is signed, it is not his

signature and the customer did not

authorize anyone to sign on his behalf.

Agents are often tempted to com-

plete an application with information

received over the phone and they are

given permission to sign the applica-

tion on the customer’s behalf in order

to save time. See Lesson One and Two.

Don’t give into the temptation.

After you receive the completed ap-

plication from your customer, be sure

to review it to ensure that all the ques-

tions and information have been com-

pleted and included. The agent should

make sure the application includes

accurate information regarding prior

fi res/claims (regardless of size), prior

denials/cancellations and unusual fi re

hazards. You may not realize it, but un-

usual fi re hazards can be encountered

with the application for a homeowner’s

policy where the applicant has a hobby

or part time job that requires them

to store large supplies of fl ammable

liquids. This is the type of risk a carrier will say they would not

knowingly accept. Further, agents should include all known

relevant information an underwriter would obviously want

continued on page 18»

KNOWLEDGECOMES FROM EXPERIENCE

“I go the distance on my bike—just like my 30-year journey with J.M. Wilson. I lead a great team of managers and underwriters that work hard to help our agents be successful.”

Sandi Fritz, CICVice President, Underwriting and Branches—and fi xture on the bike trail

Connect with Sandi on LinkedIn!

800.666.5692 jmwilson.com

PIA National 2011 MGA of the Year

Property/Casualty Professional Liability Surety Commercial Transportation Personal Lines Premium Finance


to know, such as prior losses at other

properties owned by the same individu-

als (even if technical ownership is by a

different corporate entity).

II. Claim assistance Fires can be big news events for the

local media and many times the agent

becomes aware of a fi re while it is still

burning. Often a policyholder will call

the agent from a fi re scene wanting to

know what to do and ask for assistance

in reporting the claim. Problems can

arise when the agent is asked if there is

coverage for the fi re loss and the agent

responds without reviewing the policy.

Lesson Three: Never advise the

policyholder what will or won’t be

covered. While your fi rst inclination

is to tell them what you think, let the

adjuster for the carrier give that infor-

mation. You can help them contact the

carrier, but after the loss is reported,

get out of the way. Without looking at

that customer’s actual policy, an agent

may assume fi re coverage is in place

and tell the policyholder not to worry.

While many policies are identical,

there is a chance that there is some

special provision that could apply. In

many instances there is no coverage

for a number of reasons including the

policy recently lapsed for non-payment

of premium. In other instances the

policyholder may have several locations

covered under the policy but forgot to

add the location that suffered the loss.

Sometimes there are special require-

ments under a commercial policy that

require the policyholder to take certain

precautions to lower the fi re risk such

as having sprinklers in place or special

fi re alarms. If the policyholder has not

complied with these requirements it

may cause the claim to be denied.

A signifi cant problem arises when an

agent assumes a legal duty he may not

otherwise have by agreeing to notify the

carrier of the fi re. If the agent agrees to

assume this duty, care must be taken to

notify all of the customer’s potentially

responsible carriers. Courts have held

that if an agent assumes a duty it must

carry out that duty without negligence.

After a fi re is extinguished and all the

fi re fi ghters, trucks and equipment are

gone, the policyholder can be very anx-

ious to get the cleanup work started.

The policyholder may ask the agent

if he may proceed with the cleanup

work. Although the cleanup seems to

be a routine matter to the agent, this

approval to start should come from the

adjuster or carrier, and not from the

agent. If the work is started because

the agent told the policyholder to start

but the carrier later denies the claim

after investigating, the agent may be in

a diffi cult situation. The policyholder

will look to the agent for any costs as-

sociated with the cleanup if the carrier

refuses to pay.

The same holds true with repair work.

Sometimes the policyholder, carrier

and contractor point their fi ngers at

the agent when the carrier refuses

to cover the work entirely or says the

expense is in excess of what the policy

will allow. Let’s assume the agent tells

the policyholder to start the repair

work and the current building codes

require additional work beyond just

repair. The policy may exclude or limit


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coverage for any work associated with

the improvements to meet the current

building codes. When the carrier denies

this expense in whole or in part the

contractor will look for payment from

the policyholder. The policyholder in

turn will look to the agent since he gave

approval to proceed.

III. Paying the claim-actual cash value vs. replacement cost After the fi re and cleanup, then comes

the task of paying the loss from the

fi re. In general, there are two methods

to determine how much should be

paid: Actual Cash Value vs. Replace-

ment Cost. Simply stated, Actual Cash

Value (ACV) is the actual value of the

property at the time of the loss less

depreciation. Replacement Cost (RC) is

how much it would cost to replace the

property if it were to be rebuilt just as

if it had never been destroyed. There

are many variables that can play into

these amounts, but in most instances

ACV is less than RC. The agents’ job

is to make sure that at the time the

policy is applied for, that the customer

understands the difference and that

they make the decision about which

type of policy they want, so that if a loss

occurs, they know exactly what they will

receive. After the loss, the policyholder

may ask how much they will be receiv-

ing for their property. Many times, in

an effort to be helpful, an agent may

tell them that “everything is covered”,

and these words could come back to

haunt them if everything isn’t covered.

It is the carrier’s duty to review the

claim and determine how much is to

be paid, not the agent’s. Lesson Four:

Let the carrier discuss payment of the

claim with the policyholder. You can

be sympathetic with your customer, but

after the loss only the carrier and their

representatives can tell them how much

they will receive.

Hopefully, this has served as a refresher

and reminded you that as the agent you

must use due care when underwriting

and responding to fi re losses. That care

starts with having your customer com-

plete the application accurately and

correctly. It continues through to claim

reporting; but remember -adjusting

the claim and all activities related to it

should be done by the carrier or its ad-

juster – not the agent. While all of this

may seem routine, it is not inconse-

quential and is sometimes overlooked

during the rush of doing business. Oh,

and one more thing: always remember

to document, document, document.

Because if you didn’t document it, it

didn’t happen.

*Ed Barbosa, JD, is an Assistant Vice

President of Swiss Re/Westport,

handling insurance agents errors and

omissions claims. Prior to attending

law school he was on the Kansas City,

MO Fire Department for 10 years. Af-

ter law school he practiced for 13 years

and has been with Swiss Re for the last

8 years.

This article is intended to be used for gen-eral informational purposes only and is not

to be relied upon or used for any particular purpose. Swiss Re shall not be held responsi-ble in any way for, and specifi cally disclaims any liability arising out of or in any way connected to, reliance on or use of any of the information contained or referenced in this article. The information contained or referenced in this article is not intended to constitute and should not be considered legal, accounting or professional advice, nor shall it serve as a substitute for the recipient obtaining such advice. The views expressed in this article do not necessarily represent the views of the Swiss Re Group (“Swiss Re”) and/or its subsidiaries and/or management and/or shareholders.


Wichita’s Sam Stevens took first place in the boys’ division at this year’s Kan-sas Trusted Choice Big “I” Junior Classic Golf Tournament on Tuesday at Prairie Dunes Country Club in Hutchinson, KS. A record one hundred twenty-two ju-nior golfers participated in the 2-day event. Stevens shot a 2-day score of 140, just three strokes ahead of second place, Seth Bryan of Winfield, KS, and just six strokes ahead of third place, Alex Springer of Olathe, KS. Haley Florey of Topeka, KS, shot a 155 to win the girls’ division, followed closely by Abigail Shaddix of Garden City, KS, who shot a 156.

All five players have earned entries into the national tournament in Aus-tin, TX, to be held August 7-10. Travel expenses and entry fees will be paid for by the Kansas Association of Insur-ance Agents.

The Trusted Choice Big “I” National Championship is the nation’s largest junior stroke-play golf tournament and one of the premier junior golf events. The event, organized by the Indepen-dent Insurance Agents & Brokers of America (The Big “I”), attracts elite junior golfers from throughout the United States. The goal of the Big “I” is to provide the youth of America an opportunity to channel their energies into a positive experience, and to com-pete in a sportsmanlike atmosphere through an event that culminates in a true national championship.


1

AGENT OF THE YEAR AWARD

Nomination Form

The Agent of the Year Award is given to honor an individual who has made a significant industry

contribution and/or enhanced the ideals and reputation of the insurance industry. The award is also

given to an individual who has set a stellar example by committing time and service to his or her

community. This award is open to all KAIA agent members. The winner will be announced at the

Leadership Banquet during the 2012 Management Conference, October 3-5 at the Overland Park

Marriott Hotel.

Deadline for receipt of nominations is September 1, 2012. Please use additional pages for any

answers below. Candidate Information

Nominee Name: __________________________________________________________________

Full address: ____________________________________________________________________

Phone: __________________________________ Email: _________________________________

Agency: _________________________________________________________________________

City/ST/Zip: ______________________________________________________________________

Organizations/offices held: _________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

Achievement(s) in Business: _______________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

1

COMPANY REPRESENATIVE OF THE YEAR Nomination Form The Company Person of the Year Award is given to honor an individual who has been a significant

proponent of KAIA and its agency members, enhanced the ideals and reputation of the insurance

industry as well as assisted in promoting the independent insurance agency brand. This award is

open to all KAIA company members. The winner will be announced at the Leadership Banquet

during the 2012 Management Conference, October 3-5 at the Overland Park Marriott Hotel.

Deadline for receipt of nominations is September 1, 2012. Please use additional pages for any

answers below.

Candidate Information Nominee Name: __________________________________________________________________

Full address: ____________________________________________________________________

Phone: __________________________________ Email: _________________________________

Agency: _________________________________________________________________________

City/ST/Zip: ______________________________________________________________________

Organizations/offices held: _________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

Achievement(s) in business: _______________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

ny

___

___

____

_____

______

_______

_______

_______

________

_________

_________

__________

__________

___________

1

______________________________

_____Full address: ________________________________

________Phone: __________________________________ Email: ___Agency: _____________________________________

________City/ST/Zip: _______________________________

____________Organizations/offices held: __________________________

______________________________________________

______________________________________________________

______________________________________________________

___________Achievement(s) in business: _________________________________________________________________________

_____________________________________________________

________________________________________________________

_______________

1

DISTINGUISHED SERVICE AWARDNomination Form The Distinguished Service Award is given to honor an individual who has gone above and beyond the

call of duty to promote, assist and/or partner with KAIA by volunteering, advocating on behalf of or

enhancing association membership or operations. This award is open to all KAIA agent and

company members. The winner will be announced at the Leadership Banquet during the 2012

Management Conference, October 3-5 at the Overland Park Marriott Hotel. Deadline for receipt of nominations is September 1, 2012. Please use additional pages for any

answers below.

Candidate Information Nominee Name: __________________________________________________________________Full address: ____________________________________________________________________ Phone: __________________________________ Email: _________________________________Agency: _________________________________________________________________________City/ST/Zip: ______________________________________________________________________Organizations/offices held: _________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________Achievement(s) in business: _______________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Nominations are now being accepted for the prestigious KAIA Awards.

For more information, go to the Management Conference section of our website:

www.kaia.com


Congratulations to

The National Alliance for Insurance Education & Research is proud to an-nounce the state winners of the 2012 Outstanding CSR of the Year Award. Regarded as the foremost national award of its kind, the award recognizes the contributions and commitment of those who serve clients within the insurance industry. To qualify for the top state honor, the 2012 candidates submitted an essay on the following topic: “Given the emphasis that many of your Commercial Lines and Person-al Lines clients place on price, identify and explain four (4) important actions your companies have taken, or could take, to help you and your agency be-come more competitive.” Additionally, entrants demonstrated commendable service to their agencies, their industry, and their community. The only eligibil-ity requirement for this award is that the candidate must be an insurance customer service representative, or have primary responsibility for insur-ance customer service duties.

Each state winner receives a framed certifi cate and is eligible to compete for the national honor, which carries a $2,000 cash award, a gold and dia-mond pin, $1,000 cash award for the nominator, and a scholarship for the recipient’s employer to any program offered by The National Alliance. Addi-tionally, the name of the National Out-standing CSR of the Year is inscribed

on a sculpture permanently displayed at The National Alliance for Insurance Education & Research headquarters in Austin, Texas.

Outstanding Customer Service Representative of the Year Award- Wining Essay

By Jackie Honomichl, AINS, Account Manager, Cretcher Heartland

“Given the emphasis that many of your Commercial Lines and Personal Lines clients place on price, identify and ex-plain four (4) important actions your companies have taken, or could take to help you and your agency become more competitive”.

There was a time when putting clients policies on a BOP (Business Offi ce Policy) or a Package that would provide additional coverages without additional premium would satisfy what the insured wanted and needed, but in this com-petitive marketplace, whether it be a soft market or hard market, price seems to be the biggest key to what insureds look at when buying insurance. Oh sure, they look at coverage’s, but they still want the lowest price. Below are a few of the innovative things some carriers are offering. A lot of carriers are offering ease of doing business. You can go on

the internet and get any type of coverage quoted. It is not a price saving tool but it is time saving for the insurance buyer.

One way to become more competitive and perhaps saving clients money would be for them to “One Stop Shop”. Writing all coverage’s with one carrier can pro-vide credits for various lines of coverage written by one carrier. An insured can get a multi-line discount or a multi-car discount. This type of credit is geared more to personal line carriers but there are a few Commercial carriers that allow a multi-line credit. Savings can be sub-stantial when Homeowners and personal autos are written with the same carrier.

Being competitive is not just price but could include pay plan options that helps the insured with cash fl ow. You’re going to see this type of offer with Workers Compensation policies. An insured who has a seasonal business, for example, a nursery or a trucker, could benefi t from a “Pay as You Go” pay plan. During the winter months these businesses tend to not be as busy as in the summertime. This affects their cash fl ow and makes it diffi cult for them to pay premiums throughout the policy term. This type of pay plan allows insured to pay premiums

Jackie Honomichl with Cretcher Heartland

continued on page 32»


The Affordable Care Act A

First, several noteworthy provisions have already been implemented:

1) Pre-Existing Conditions: All group and individual health plans, in-cluding self-insured plans, now have to cover pre-existing conditions for chil-dren – up to age 19. Starting in 2014, insurance companies cannot deny coverage to anyone with a pre-existing condition.

2) Prohibition of Coverage Limits: No carrier may impose a Lifetime Limit for any fully insured group, self-insured group, nor individual plan. Annual lim-its will be allowed until January 1, 2014, but only on non-essential benefi ts, and after that there will be no annual policy cap. (Note: “non-essential benefi ts” should be fully defi ned by late 2012.) The minimum mandated “annual limit” that every plan must provide in

2012 is $1.25 million in coverage. Note that a number of businesses (almost 1,500) did receive a “waiver” to this “annual limit” rule and can currently provide coverage with less than this limit. In 2014, the waivers go away and everyone that purchases or that is provided a QHP will have no dollar cap on coverage.

3) Dependent Coverage to age 26: All plans will now have to cover dependents up to age 26. Yes, this includes adult children that no longer attending college, those not living with their parents, and even those adult children who are married (if married, this provision does not extend to the spouse or any children of the adult child). This provision only applies to plans that already offer dependent coverage and election to this provision does have some exceptions.

4) Certain mandated preventive care services with no cost shar-ing: All group and individual health plans, including self-insured plans, will have to cover specifi c preventive care services with no cost sharing. They will also have to cover emergency services at the in-network level regardless of provider.

There are several key provisions that are scheduled in future years:

1) (2013) Increased Medicare Tax on High-Income Individuals: Raises the Medicare Part A (Hospi-tal Insurance) on wages by 0.9% on earnings over $200,000 for individual taxpayers and $250,000 for married couples fi ling jointly. There would also be a 3.8% assessment on “unearned income” for these high-income tax-payers. The law defi nes “unearned income” as interest, dividends, capital gains, annuities, royalties, and rents. Tax-exempt interest won’t be included, nor will income from qualifi ed retire-ment accounts.

By JERRY RHINEHART, CIC, CLU, ChFC, RHU

On June 28th, the U.S. Supreme Court ruled the Affordable Care Act (ACA) as “con-stitutional” and it will be implemented as written – unless there is future legislative action that changes, or resends the law. The court did¬ rule on a change of course for some provisions (primarily the expansion of Medicaid and the role the states will play) but the key components of the ACA remains intact. The major provisions of the law will be effective in 2014. Everyone – with minor exceptions – will be required to be covered by a Qualified Health Plan (QHP) in 2014. Most of us will continue to be insured by an employer-sponsored plan. The premiums paid by the employer will continue to be tax deductible, and, those employer-paid premiums will continue to be “not reported” to the employees.

How will the law affect you, your family, your employer, employers you know - or maybe you insure?


2) (2013) Contributions to a Flexible Spending Account (FSA) for medical expenses will be limited to $2,500 per year, increasing annually by the cost of living.

3) (2014) A QHP will be Required to be Carried by all U.S Citizens and legal residents. Exceptions do apply. There would be a phased-in tax penalty for those without coverage, starting at the greater of $95 annually or 1% of gross income, in 2014, and rising to the greater of $695 annually or 2.5% of gross income in 2016.

4) (2014) Potential Penalties on Employers with 50 or more full-time workers (defi ned as a “Large Employer”) that DO NOT provide a QHP to its employees. The penalty would equal $2,000 per worker, although the fi rst 30 workers would not be counted. The penalty would only be accessed if ANY full-time employee (defi ned as working 30 or more hours per week) receives a federal subsidy to purchase a QHP. The subsidy is available if the income (individual or family) is below a certain federal poverty level - currently about $89,000 annu-ally for a family of four. The QHP must be purchased through the state’s Health Insurance Exchange for the applicant to receive the premium subsidy. The defi nition goes farther to include the possibility of a penalty to a “Large Employer” even

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if they DO provide a QHP. This potential penalty would $3,000 for every full-time employee that receives a premium subsidy through the Exchange. The penalties, calculations, defi nitions and exception are very complicated with many variables to consider.

The areas discussed above are a fraction of the law’s vast impact. In addition to individuals, families and business own-ers, the law will also greatly affect your state’s budget, health insurance companies, physicians, hospitals, and even nutrition-al content disclosure. Almost every aspect of daily life will have some brush with this law. There are numerous websites that can be helpful for additional information to understanding this complex law. A couple of very benefi cial sites are: http://www.aetna.com/health-reform-connection/index.html and http://healthreform.kff.org/.

It is safe to say the debate regarding the ACA’s merits will be a heated topic in this fall’s presidential and congressional elections. Regardless of the law’s ultimate fate the landscape of health insurance for individuals, families, business owners and health care providers and payors has changed substantially and will continue to do so.


“Users of PCs and mobile devices should be trained to remove any emails with per-sonal data that may be re-ceived on these devices, as soon as they are read.”

be careful to make sure that this personal data is kept off of PCs, mobile devices, thumb drives, where there is a signifi -cant risk of loss or theft.

PCs & Mobile DevicesUsers of PCs and mobile devices should be trained to

remove any emails with personal data that may be received on these devices, as soon as they are read. In addition, the agency should audit to make sure any PCs and mobile devices that can access agency applications are password protected. Further, the agency should implement software that can wipe all of the data off of these devices should they be lost or stolen, restoring them to their original manufac-turer’s state.

Secure EmailEmail is the fi rst major area where agencies need to be-

gin to encrypt their communications to carriers and clients when personal data is included. Some prominent examples of emails likely to include personal data include: sending

insurance applications to carriers for a quote or to clients to complete or to sign, and sending insurance policies to clients.

With respect to emails between agencies and carriers (and general agents), ACT recommends that TLS secure email be implemented wherever possible. TLS (Transport Layer Security) is an open standard that once implemented between an agency and a carrier (both parties must have TLS imple-mented), all of the emails between the partners go securely in a manner that is transparent to the end users. In other words, the agent or carrier underwriter does not have to go to a pro-prietary website to pick up each email (which many underwrit-ers will not do and is ineffi cient for agency employees to do). TLS is a great solution for business partners where there are frequent email communications going back and forth.

Many agencies can implement TLS if they have email serv-ers or hosted solutions that offer TLS. We recommend that the

AGENCY STRATEGIEScontinued from page 5

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initial TLS set up be han-dled by the agency’s tech-nology person, who should also verify that the TLS is working properly with each carrier and general agent. You will fi nd a number of re-sources that explain TLS se-cure email more thoroughly on the ACT website (see “ACT Resources” below), including a list of carriers which have advised us that they have TLS available.

Unfortunately, most agency clients will not have TLS capability and there-fore, TLS is not a solution for communications with them. This will require the agency to implement a proprietary email solution as well for these clients. When the agent sends a secure email to the client using one of these proprietary solu-tions, the client accesses it

on the email vendor’s secure website. The secure email tool also enables the client to send a secure email back to the agent, which is very helpful when the client is being asked to complete a D&O application, for exam-ple. Fortunately, there are a number of vendors which can help agencies with both TLS hosted emails and proprietary emails, as well as to provide many other useful tools. (Two examples of such vendors are AppRiver and RPost.)

Real TimeToday email is used

heavily to convey applica-tions and other informa-tion between agencies and carriers and general agents, particularly in commercial lines. It is important to note, however, that Real Time

offers a more effi cient and secure method to handle these communications, where the communications are automatically encrypted and kept within the agency’s and carrier’s management systems.

Agencies are heavily us-ing Real Time for personal lines and we need to in-crease the usage in commer-cial lines. Many agencies and carriers are already using Real Time to submit com-mercial lines applications and make quote requests for small commercial business, and some have started to use their real-time functionality to make mid-commercial submissions.

In addition, there is great potential for the indus-try to use Activity Notifi ca-tions to communicate other types of messages directly

between the parties’ systems (such as the need for more underwriting information), without having to manage a morass of emails in employ-ees’ mailboxes.

We urge agencies and carriers to continue to push the use of Real Time within their organizations and with their business partners, par-ticularly for commercial lines transactions and commu-nications. Real Time is the workfl ow of the future for commercial lines, as well as personal lines. Email is not.

Agency WebsitesIt is also critical that

agencies provide secure website connections for consumers when they ask the consumer to provide person-al data on the website – to receive a quote, for example. The website should create a secure “https” tunnel before the consumer can fi ll out any form that asks for personal data, just as you would ex-perience when purchasing something online or banking online.

In addition, if the agen-cy provides a “non-https” protected free-form text fi eld which the consumer can use to contact the agency and make requests, there is some risk the consumer will enter private, personal data. Therefore, it is a best prac-tice to take one of the fol-lowing steps with regard to this free-form text fi eld: (1) to secure it, (2) change it to specifi ed fi elds that ask only for basic contact informa-tion, such as name, phone



Have You AScKed Lately?

For more than 50 years, insurance agents and bro-kers across Amer-ica have trusted

Swiss Re Corporate Solutions (Westport Insurance Corpora-tion) to protect their business, reputations and assets. Swiss Re Corporate Solutions is proud to be endorsed by the IIABA and all Big “I” state asso-ciations nationwide. Swiss Re has now developed an Um-brella program with our members in mind. Some of the features of this coverage are:

Provides coverage over pri-mary, underlying E&O limits, as well as limits over general li-ability, auto, employer’s liability and other liability lines.

Limits available up to $10 million over the underlying coverage including their non-admitted E&O policy.

Benefits for you:

This Umbrella program can be written over a variety of E&O carriers in the event Swiss Re Corporate Solutions does not write your primary policy.

Rating and coverage is structured to help you maxi-mize premium dollars for the limits desired.

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www.ringwalt.com

number, email, address, or (3) include a note with the free-form text fi eld that it is not secure and should not be used to provide any private personal data.

If the agency provides clients with the capability to access their insurance information or documents online, the website should create an “https” con-nection before any information can be accessed. Once again, agents should work with their website provider to help them with the technical aspects of creat-ing this secure website capability.

Some agency E&O providers also require the agency to post a privacy statement on its website(s), if there is an option for the consumer to submit personal data through the website. It is important that the agency custom-ize its privacy statement to track the agency’s particular data collection, usage, sharing, and protection practices with regard to data collected through its website(s). Honda’s fi nancial services website privacy statement provides a good example of the types of informa-tion that are typically included in such statements.

ACT ResourcesThis article has covered a few of

the areas agencies must manage when protecting the security of their clients’ and employees’ personal data. ACT has developed several resources for agencies to review as they establish and implement their agency’s comprehen-sive information security program. All of these resources are included on the Security & Privacy page of the ACT web-site. These resources include a proto-type agency information security policy which agencies can use as a template to build their own customized policy or as a checklist of security issues they should address.

For more on TLS secure email, the ACT Security & Privacy page includes articles, FAQs, a recorded webinar and a list of carriers which have implement-ed TLS. For more on securing your website and managing potential E&O exposures arising from the website, see

the article “Don’t Get Caught in the Web.”

ACT’s Security & Privacy page also includes sample website disclaimers, a recorded briefi ng on HIPAA-HITECH requirements for “Business Associates,” and additional articles focusing on: the E&O and security risks arising from the use of social media, precautions to take when using free, public Wi-Fi sites, and how to manage the “Bring Your Own Device” trend where employees are

AGENCY STRATEGIEScontinued from page 27

using their personal devices to access business applications.

Jeff Yates is Executive Director of the Agents Council for Technology (ACT) which is part of the Indepen-dent Insurance Agents & Brokers of America. Jeff can be reached at [email protected]. ACT’s website is www.iiaba.net/act. This article refl ects the views of the author and should not be construed as an offi cial statement by ACT.


UPCOMING CIC INSTITUTES

Register online at www.kaia.com

KAIA is the leading provider of agentcontinuing education in the state, manag-ing both the Certifi ed Insurance Counselor (CIC)and Certifi ed Insurance Service Representative (CISR) designation pro-grams of the National Alliance for Insur-ance Education and Research.

• Kansas CE Requirements

• Designation Certifi cation

• Ethics

• Westport E&O Loss Control

• Certifi ed Insurance Counselor

• Certifi ed Insurance Service Representative

• Upcoming CE Opportunities

Register online for any of these classes atwww.kaia.com.

Phone:

(785) 232-0561

Toll Free:

(800) 229-7048

Fax: (785) 232-6817

E-mail:

[email protected]

CISR CLASSES

AUGUST- 2012 1 PR Topeka KAIA

SEPTEMBER- 2012 6 PA OP Swiss Re 18 IC OP Swiss Re 26 AO Wichita SM

OCTOBER- 2012 2 AO OP Swiss Re 18 IP Wichita SM 24 PA Topeka KAIA

30

Scan with your mobile device.

NOVEMBER- 2012 8 AO Topeka KAIA 28 PR Wichita SM

Only 2 Classes Left in 2012

Agency Management Institute Sept 12-14, 2012

Topeka

Life & Health InstituteNov 14-16, 2012

Overland Park


AD INDEX

For information about advertising, contact Rebecca Spriggs at

[email protected], or visit www.kaia.com.

Accident Fund Insurance 9

Acuity Back Cover

AScK 28

Bremen Farmers Mutual 27

Columbia Insurance Group 4

EMC Inside Front Cover

InVEST 32

J.M. Wilson 17

Kansas Fire/EMS Pak 5

Kansas Mutual Insurance Company 19

Mid-Continent Group 7

Midlands Management Companies 9

M.J. Kelly Company 26

Ringwalt & Liesche 29

Swiss Re 6

Upland Mutual Insurance, Inc. 25

United Heartland 9

COMPANY PAGE COMPANY PAGE

Brethren Mutual Aid Agency is seeking a licensed agent (Property/Casualty and Life/Health) to work with our Church Accounts. The successful candidate will be honest and ethical, and pos-sess a strong understanding of church insurance needs, estimating the value of church buildings, and identifying and managing ministry risks. A faith-based, service-minded spirit, coupled with a strong desire to act in the client’s best interest is mandatory. Responsibilities include sales, ser-vice and retention of insurance plans to churches and their related ministries. This position offers a fl exible schedule, team environment, full offi ce support, and a strong marketing communica-tions program. Compensation includes a com-petitive salary, based on applicable experience, and a very generous benefi t package.Send your letter of interest and resume to: Brethren Mutual Aid Agency, Attn: Kim Rutter, 3094 Jeep Road, Abilene, KS 67410 or e-mail to [email protected].

Insurance Agent- Church Lines & Related Ministries

Position Wanted: Agency Producer. Attn: Decision Mak-ers, Dynamic business development representative, (Cold Caller) seeks a rewarding & challenging career opportunity with a progressive commercial lines agency. Please call Rob for details: 701.540.1295


applications and claim forms; HB 2487 – Uniform Insurance Agents Licens-ing Act; violations (regarding agent response to KID inquiries); HB 2508 – Insurance Holding Company Act; and HB 2519 – Granting the insurance department access to expungement re-cords of applicants for insurance agent licenses.

Those possibilities will probably be revisited prior to the beginning of the 2013 session.

On a personal note, I want to congratulate the KAIA for dedicating the Larry McGill Education Center in June. The state of the art electronic facility at the KAIA headquarters in Topeka will educate professionals and non-professionals alike in the business of insurance. It will be a valuable help for those working with continuing edu-cation requirements. KAIA members should be proud of the organization’s efforts to provide this center in in Larry’s memory.

LEGISLATIVE SESSIONcontinued from page 7

InVEST can help.

www.investprogram.org

InVEST connects insurance

professionals with the

education community so you

can meet up-and-coming

professionals and teachers

meet financial literacy

learning requirements—a

winning combination for

more than 40 years. Support

InVEST to make your recruit-

ment goals within reach.

there is a claim, and the vanishing de-ductible shows how a carrier can reward an insured for being loss free. Insurance policies are contracts of Adhesion (one side has bargaining power) and all insured’s have is a promise to pay if loss occurs, so by offering this type of incentive the carrier can alleviate some stress at the time of a loss for the insured.

One auto carrier offers several incentive type programs for good drivers. With “SnapShot” you just quote and buy your auto insurance. The carrier then mails your “SnapShot” device to the insured along with instructions on where plug in the device and how to use it. You drive your car as you normally would for the next 30 days. On the 31st day your “SnapShot” savings kicks in with a savings of up to 30%. Another feature this carrier offers is a “Name Your Price” tool. With this you can start a quote on line and then adjust the price based on the coverage’s needed. With this tool the insured should have a working knowledge of what coverages are needed and limits required for the state in which they reside. This carrier will also provide you with other carriers premiums for the same coverage so you can compare what other companies will offer.

Above is but a few of the offers from carriers that can help reduce an insured’s overall insurance cost. If you “surf” the Internet there are a lot more carriers offering insurance and they all say they are cheaper than the other. But are you buying the best coverage for your expo-sures at home or work? Only the insurance buyer can answer that question.

Resources:Progressive- Snapshot, Name Your Price

Allied/Nationwide-Vanishing Deduct-ible

commensurate with the payroll being paid on monthly basis. The benefi ts for the insured is that it improves cash fl ow and could eliminate premium fi nancing. Plus the insured would not be surprised by a high audit at the end of their policy term.

Another option some companies have taken is to offer Vanishing Deductibles. This applies to personal auto insurance. Customers can take $100.00 off of their deductible for each year they have of safe driving. The carrier will allow up to fi ve (5) years to add up this savings. For this, the only benefi t is when a claim occurs. This is how it works: If you have an accident, you would not have to pay deductible (up to $500). Any insurance policy shows its worth when

OCSR OF THE YEARcontinued from page 23

KANSAS FILINGS REPORT

Major Line Subject Company Eff . Date Overall

Commercial Auto Rate W. R. Berkley Group 08/01/2012 -16.10 %Commercial Auto Rate Mid-Century Insurance Company 07/01/2012 -2.60 %Commercial Auto Rate Farmers Insurance Group 07/01/2012 0.10 %Commercial Auto Rate Continental Western Insurance Company 07/01/2012 1.00 %Commercial Auto Rate Farmers Insurance Group 07/01/2012 1.00 %Commercial Auto Rate Truck Insurance Exchange 07/01/2012 1.00 %Commercial Auto Rate Columbia Insurance Group 08/01/2012 1.69 %Commercial Auto Rate Columbia National Insurance Company 08/01/2012 1.69 %Commercial Auto Rate EMCASCO Insurance Company 08/01/2012 3.50 %Commercial Auto Rate Liberty Mutual Insurance Companies 08/01/2012 10.50 %Commercial Auto Rate Peerless Insurance Company 08/01/2012 11.60 %Commercial Auto Rate Shelter Insurance Companies 07/06/2012 12.60 %Commercial Auto Rate Peerless Indemnity Insurance Company 08/01/2012 14.70 %Commercial Auto Rate Netherlands Insurance Company 08/01/2012 21.00 %Commercial Auto Rate Valley Forge Insurance Company 08/01/2012 67.00 %Commercial Multi-Peril Rate W. R. Berkley Group 08/15/2012 -0.87 %Commercial Multi-Peril Rate W. R. Berkley Group 08/15/2012 -0.52 %Commercial Multi-Peril New Program Farm Bureau Property & Casualty Group 08/14/2012 0.00 %Commercial Multi-Peril Rate Peerless Indemnity Insurance Company 08/01/2012 0.60 %Commercial Multi-Peril Rate United Fire & Casualty Company 08/01/2012 1.30 %Commercial Multi-Peril Rate Zurich Insurance Group Ltd 07/01/2012 3.20 %Commercial Multi-Peril Rate Citizens Insurance Company of America 08/01/2012 3.40 %Commercial Multi-Peril Rate Wausau Underwriters Insurance Company 07/01/2012 4.70 %Commercial Multi-Peril Rate United Fire & Casualty Group 08/01/2012 6.10 %Commercial Multi-Peril Rate W. R. Berkley Group 08/15/2012 14.90 %Commercial Multi-Peril Rate Peerless Insurance Company 08/01/2012 15.70 %Commercial Multi-Peril Rate Peerless Indemnity Insurance Company 08/01/2012 15.90 %Commercial Multi-Peril Rate Liberty Mutual Insurance Companies 08/01/2012 16.70 %Commercial Multi-Peril Rate Continental Western Insurance Company 08/15/2012 16.80 %Commercial Multi-Peril Rate Netherlands Insurance Company 08/01/2012 17.00 %Commercial Multi-Peril Rate Wausau Business Insurance Company 07/01/2012 21.60 %Commercial Multi-Peril Rate Peerless Indemnity Insurance Company 08/01/2012 27.50 %Crime Rate Everest Re Group Ltd 07/01/2012 -15.00 %Farmowners Rate Nationwide Mutual Insurance Company 08/01/2012 9.20 %Fire & Allied Lines Rate Munich-American Holding Corp Companies 08/01/2012 -3.00 %Fire & Allied Lines Rate COUNTRY Financial Property Casualty Grp 08/01/2012 0.10 %Fire & Allied Lines Rate Marysville Mutual Insurance Company 07/01/2012 4.50 %Fire & Allied Lines Rate Farmers Alliance Mutual Insurance Co 07/15/2012 10.20 %Fire & Allied Lines Rate Continental Western Insurance Company 08/15/2012 11.90 %Fire & Allied Lines Rate W. R. Berkley Group 08/15/2012 12.20 %Fire & Allied Lines Rate Zurich Insurance Group Ltd 07/01/2012 13.60 %General Liability Rate Cincinnati Insurance Company 07/01/2012 -50.76 %General Liability Rate/Rule/Form Munich-American Holding Corp Companies 07/01/2012 -1.10 %General Liability Form Capitol Indemnity Corporation 08/01/2012 0.00 %General Liability Form United Fire & Casualty Group 07/01/2012 0.00 %General Liability Rate/Rule/Form United States Liability Insurance Co 07/10/2012 0.00 %General Liability Form Wausau Underwriters Insurance Company 07/01/2012 0.00 %General Liability Rate W. R. Berkley Group 08/15/2012 4.78 %General Liability Rate W. R. Berkley Group 08/15/2012 5.06 %General Liability Rate Liberty Mutual Insurance Companies 08/01/2012 14.60 %General Liability Rate Netherlands Insurance Company 08/01/2012 14.60 %General Liability Rate Peerless Insurance Company 08/01/2012 14.90 %Homeowners Multi-Peril Form Farmers Insurance Group 07/01/2012 0.00 %Homeowners Multi-Peril Rate State Farm Fire and Casualty Company 08/15/2012 5.70 %Homeowners Multi-Peril Rate Marysville Mutual Insurance Company 07/01/2012 6.00 %Homeowners Multi-Peril Rate Kemper P&C Group 08/01/2012 7.00 %Homeowners Multi-Peril Rate California State Auto Group 07/01/2012 7.50 %Homeowners Multi-Peril Rate Lititz Mutual Insurance Pool 08/01/2012 8.10 %Homeowners Multi-Peril Rate/Rule/Form Standard Guaranty Insurance Company 08/01/2012 9.10 %Homeowners Multi-Peril Rate Employers Mutual Casualty Company 07/01/2012 9.50 %Homeowners Multi-Peril Rate Union Insurance Company of Providence 07/01/2012 12.00 %Homeowners Multi-Peril Rate EMCASCO Insurance Company 07/01/2012 12.20 %Homeowners Multi-Peril Rate Farmers Alliance Companies 08/01/2012 12.40 %Homeowners Multi-Peril Rate Liberty Mutual Insurance Companies 07/01/2012 13.40 %Homeowners Multi-Peril Rate West American Insurance Company 07/01/2012 14.10 %Homeowners Multi-Peril Rate Ohio Casualty Insurance Company 07/01/2012 15.50 %Homeowners Multi-Peril Rate Farmers Alliance Companies 08/01/2012 18.50 %Homeowners Multi-Peril Rate/Rule/Form Foremost P & C Ins Co 07/01/2012 19.80 %Homeowners Multi-Peril Rate Farmers Alliance Mutual Insurance Co 08/01/2012 21.40 %Inland Marine Rate Progressive Insurance Group 08/03/2012 -5.30 %Inland Marine Rate White Mountains Insurance Group 07/01/2012 -0.20 %Inland Marine New Program IDS Property Casualty Insurance Company 07/01/2012 0.00 %Inland Marine Form Munich-American Holding Corp Companies 07/01/2012 0.00 %Market Segments Rate Insurance Services Offi ce 08/01/2012 -15.80 %

33March/April 2012 :: KANSAS INSURANCE AGENT & BROKER

kia&b july/august 2012

Documents

p r o f e s s i o n

r d o f d i r e c t

kansas filings

young agents committee

agents council

emc insurance companies

e n t spresidents message

technology committee