Primary Agent - September 2010 - DE Edition

INTHISISSUE________________

Q&A with Steve Anderson

Cyber coverage

DELAWARE

G16030_Sept2010Covers.qxp:Sept2010Primary 8/6/10 1:46 PM Page 1

A 1-2 PUNCH!

BUSINESS | HUMAN SERV ICES | INLAND MARINE | AUTO | HOME | L I FE/EMPLOYEE BENEF I TS | F LOOD

When you’ve got Harleysville CustomPakSM in yourcorner, it’s easy to go toe-to-toe with the competitionfor quality commercial lines business. With a robustcombination of core enhancements all built intothe base cost of the product, CustomPak deliversthe punch that many carriers offer as extras undertheir BOPs for small business customers. For smallmiddle-market accounts, our CustomPak productconnects just as cleanly with an alternative coveragetier that offers higher base limits with the flexibilityto boost protection even further.

If you’re looking for a knockout sale in the firstround, put on the gloves and start writingCustomPak business with Harleysville today.

For more information, call 800.523.6344, ext. 5016,visit www.harleysvillegroup.com, or contact yourlocal Harleysville office.

Harleysville CustomPakSM

G16030_IFC-IBC-OBCSept2010.qxp:Layout 1 8/6/10 1:54 PM Page 1

Insurance for RestaurantsFamily Style, Pizza Shops, Take-Out, Fast Food, Donut Shops,

Diners, Cafes, Bagel Stores, Franchises

Brokers Surplus Agency wants to quote your restaurants!

We have a terrific BOP program that’s packed with the coverages you need.New Ventures eligible!Liquor liability coverage available!

Contact us by phone or email today!(215) 443-9900

Brokers Surplus AgencyP.O. Box 2849

Warminster, PA 18974

Dennis Marsaglia, Ext. [email protected]

Evelyn Frisch, Ext. [email protected]

G16030_01-11PrimAgSept10.qxp:September2010 8/6/10 2:07 PM Page 1

The social networking train has left the station: Industryexpert talks Web. 2.0Like it or not (and understand it or not), there’s no denying social networking’sexplosive takeoff over the past year. The social Web is transforming how weconnect with family, friends and customers. IA&B’s Q&A with Steve Andersonshares expert insight on the industry’s adoption of social strategies.

Page 12

Cyber coverage: the new ‘must-have’ in the P&C portfolio?Cyber insurance may sound best suited for Vulcans or Klingons. But humans,the future is here. Read on to learn how to live long and prosper from the salesopportunities these new exposures present.

Page 20

12

20

ContentsP R I M A R Y A G E N T M A G A Z I N E

Copyright 2010. All rights reserved. No material may be reproduced in whole or in part without written consent of the publisher. The information in this publication is general in nature and is not intended to serve as legal, accounting, financial,insurance, investment advisory or other professional advice as to any reader’s particular situation. Users are encouraged to consult withcompetent legal, financial, insurance, investment advisory and or other professional advisors concerning specific matters before makingany decisions and we disclaim any responsibility for any decisions or actions by readers. Statements of fact and opinion in PrimaryAgent are the responsibility of the authors alone and do not imply an opinion on the part of the officers or the members of the IA&B.Participation in IA&B events, activities and/or publications is available on a non-discriminatory basis and does not reflect IA&Bendorsement of the products and/or services.

Subscriptions: Non-member price: $2.25 per copy or $15 per year.

All communications for publications, including news, features, advertising copy, cuts, etc., must reach the editor by 1st of month two monthsprior to publication. Advertising rates furnished upon request.

Address inquiries to:Primary Agent EditorPO Box 2023Mechanicsburg, PA 17055-0763Phone (800) 998-9644 or (717) 795-9100 Fax (717) 795-8347

Periodical postage paid at Mechanicsburg, Pa. and additional entry post office.

Postmaster: Send address changes to above address.Primary Agent (ISSN 1543-3110), Permit # 638-620, Issue # 2010-9) is published monthly by IA&B Service Group Inc., a subsidiary of IA&B.

4 Chair of the Board’s Message5 Member FAQ6 State News8 Preventing Errors & Omissions10 Coverage Corner

15 Glance at Events19 IA&B Partners28 Advertisers Index28 Classified Ads28 Last & Least

In every issue

Mission StatementPrimary Agent delivers ideas to helpInsurance Agents & Brokers’ membersnegotiate their unique position asguardians of trust between insuranceconsumers and companies whilefacing the challenges of maintaining a small business. Primary Agent also supports IA&B’s mission topreserve and advocate the AmericanAgency System.

That’s

w

With our “A” Rated Treasury Listed bonds wec Why shopa If we can’t writet We specialize in bonding those “less than p

We’ve beenw N And by the way, we’ll even write thatb Call now and get results not excuses.


“No bond, no job. No job,no commission.”

We know times in the construction business are tough andthat even the best of clientsare having problems. That’swhy when your client needs abond Commonwealth Surety should bethe first call you make. With our “A” Rated Treasury Listed bonds wecan provide the bond you never thought you could get. Why shoparound, get buried with paperwork and hear excuses? If we can’t writethe bond nobody can! We specialize in bonding those “less than perfect” clients, without cash collateral or Letters of Credit, and we’ll getyou that “YES” that you want to hear in 24 hours or less. We’ve beenwriting bonds for small and midsized companies for over 20 years. No bond is too big or too small. And by the way, we’ll even write thatbond for your perfect clients. Call now and get results not excuses.TOLL FREE: 1-800-886-7760FAX TOLL FREE: 1-800-566-7761

The place for the hard-to-place Bonds


OfficersDavid Rosenkilde, CIC

Chair of the BoardReisterstown, Md.

Robert B. Hall, CPCU, CLU, ChFC, ARM, ARM-PVice Chair of the BoardWest Chester, Pa.

Kathleen M. Glattly, ChFC, CLU, CPCUImmediate Past Chair of the BoardFactoryville, Pa.

MembersNorman F. Basso, CPCU

York, Pa.

Vincent D. “Chip” Boylan Jr., CPCURockville, Md.

Henry “Butch” Bradley, Jr.Crofton, Md.

Timothy P. BurrisThompsontown, Pa.

John T. “Chip” Colwell Jr., CICCorry, Pa.

G. Greg Gunn, CICLemoyne, Pa.

Diana M. Hornung-Momot, ACSRWilmington, Del.

Michael F. McGroarty Sr.Pittsburgh, Pa.

Scott C. Rogers, CPIAYork, Pa.

Susan A. Sallada, CIC**Ft. Washington, Pa.

David B. Wasson Sr., CICState College, Pa.

James M. Watkins*Dover, Del.

King W. “Kip” White, LUTCFFallston, Md.

* IIABA National Director** PIA National Director

Board of Directors

Up to the challenge

I am beginning my term as chairman of the IA&B Service Group ata pivotal time. A stubborn soft market, increased regulatorypressures, strengthening direct-writer competition, and rapidlyadvancing technology are weighing on independent agents.

But these challenges present IA&B with an opportunity — anopportunity to guide and support members. And your association is ready and willing to take on that role.

This fall, as the new directors accept their board posts, IA&B willhost a technology-themed Executive Management Conference.Seminars will cover agency management systems, data security,electronic document management and social networking. Considerthis the beginning of IA&B’s technology dialogue … and one of theways the association is striving to elevate member agencies inchallenging times.

I encourage you to learn more about the conference by reading theQ&A with Steve Anderson, contracted advisor for curriculumdevelopment, on page 12. And then I invite you to attend theExecutive Management Conference — as well as the immediatelypreceding IA&B Annual Meeting — Oct. 26-27 in Lancaster, Pa.

There is no doubt that tests and trials await. But know that yourassociation is behind you, providing programs, products andservices to support you and your agency.

Until next time,

Dave

[ 4 ]

David B. Rosenkilde Sr., CIC

Chair of the Board’sM E S S A G E


?QUESTION: I have a lingering

dispute with one of my carriers.

How do I move on to arbitration?

ANSWER: First, you mustunderstand the distinction betweenarbitration and mediation and checkwhether your agency agreementprovides for one or the other.

Blacks’ Law Dictionary definesarbitration as “a method of disputeresolution involving one or more neutralthird parties who are usually agreed toby the disputing parties and whosedecision is binding.” Mediation, on theother hand, is “a method of non-bindingdispute resolution involving a neutralthird party who tries to help thedisputing parties reach a mutuallyagreeable solution.”

Obviously, the major distinction here liesin the fact that mediation is non-binding,whereas arbitration is binding.

Since arbitration is binding, it isparticularly important to be confident inboth the neutrality and expertise of thearbitrators. One significant aspect to takeinto account is the selection process forthe arbitrator(s).

More often than not, agency agreementsthat address dispute resolution do sowith an arbitration rather than amediation provision. If so, the provisionshould state how to proceed, how manyarbitrators will be involved, and howthey will be selected. This will tell youwhat your next step should be in orderto get your dispute resolved.

Things to keep in mind —whether you have had adispute or not:w When you review an agency

agreement, take a look at thedispute resolution provision: Someagreements could be fairly looseand simply state that each party willselect its own arbitrator and the twoselected arbitrators will have toagree on a third one. Otheragreements may point to a specificentity, such as the AmericanArbitration Association (AAA) forselection of the arbitrator(s).

What you want to avoid is anythingthat could call into question theneutrality of the arbitrators. As anexample, an arbitration provisionthat selects arbitrators exclusivelyfrom current or past insurancecompany staff may raise to the levelof being questionable, at least fromthe perspective of an agency. Amore balanced provision wouldallow selection from all sorts ofexperienced insurance industryprofessionals, thus including theproducer community, insuranceconsultants and others. Also keep inmind that many disputes revolvearound contractual issues. Anarbitrator may not have a specificinsurance background, but mayhave a general businessbackground. Such an arbitratorcould be fine for your situation.

w Once the arbitrators have ruled infavor of one party, that party canimmediately claim whateverdamages were awarded by thearbitrators. Should one party notcomply with the terms of the

arbitrators’ decision, the decisioncan be entered as a judgment of thecourt. This means that the judgmentis part of the court’s docket, andcollection proceedings can takeplace (e.g. sheriff’s sale).

One parting thought: Whilearbitration provisions have thus farrarely been an issue, remember thatIA&B reviews agency agreements atno charge to members.

DO YOU HAVE AQUESTION? E-mail it to us at [email protected] use “Primary Agent FAQ” in thesubject line of your message. You canalso fax your question to (717) 795-8347.We look forward to answering yourquestions!

Member FAQ

[ 5 ]

GoodvilleMutualNew Holland, Pa.

Contact Fred Macy, [email protected]

Partnering with the finest independent agentsfor over 80 years


Primary Agent | September 2010 State NewsPolitically chargedSeptember brings two ways for DAIABmembers to flex theirpolitical muscles.

Get out and voteThe Tuesday, Sept. 14 primary election ballotwill include several top-tier races, including:

w U.S. Senate seat to replaceSen. Ted Kaufman;

w U.S. House seat to replace Rep. Mike Castle (who will run forthe Senate); and

w Posts in both chambers of thestate legislature.

Strengthen AgentPACAn election year means strain on politicalaction committee (PAC) finances. The onlyway to keep DAIAB’s AgentPAC healthy and viable through the November electionis with support from member agents. Visitwww.iabgroup.com/de/pol_act_ctr/index.htmlto learn more.

[ 6 ]

Annual Crab Feast DAIAB members gathered on Aug. 5 for the 2010 crab feast. The annual outingat Boondocks draws a loyal crowd andpresents an opportunity to catch up with old friends and plan for futureDAIAB events.

G16030_06-07DE.qxp:Sept2010 8/16/10 12:36 AM Page 2

[ 7 ]

New MembersW E L C O M E

Dwayne L. Bull Insurance Agency Inc.Smyrna, Del.

Neighboring newsPa. license-renewal conversioncontinues, trips up carriers

Pennsylvania’s transition to birth-monthlicense renewals has caused adocumentation snag for carriers. Carrierstrack producers’ license expirations and most, if not all, licensees (includingnon-residents) have been afforded an extension resulting from the birth-month-renewal conversion. Therefore,non-resident producers holding a licensein Pennsylvania should be prepared toprovide an updated license to carriers.

For producers whose license renewedbetween Jan. 1, 2010 and up to Apr. 17,2010, the license renewed at its previousexpiration date (issue date). All CE creditswere due by the normal date. However,the new license was issued with a newexpiration date (last day of the birthmonth). In other words, the dateconversion was handled through therenewal process.

For producers whose license renews on Apr. 18, 2010 and later, the currentlicensing cycle will be extended to the lastday of the producer’s birth month. Therenewal invoice will be sent 45 days inadvance of the new renewal date

NJ addresses reverserate evasion

Be aware of customers with aquestionable state of residence.Enforcement actions on non-resident rateevasion could increase in New Jersey andtrickle down to policies sold in Delaware.

The New Jersey Assembly recently passedlegislation that would make residents whoregister and insure a vehicle in anotherstate guilty of insurance fraud — and, forthe first time, allow New Jersey’sInsurance Fraud Prosecutor's Office toprosecute the cases rather than referringthem to the other state. The legislationwould close a gap facing law enforcementby making it a violation in the state ofresidence and the state of registration.The bill now moves to the state Senate.

Issues with out-of-state registrations areoften associated with uninsured and/ornon-resident rate evasion. Motor vehiclecodes tend to tie the need for financialresponsibility to the need for registration.Drivers whose vehicles aren’t registered in the correct state likely do not carry theappropriate amount of financialresponsibility (if any) and likely do notpay fees and taxes.

Tee timeDAIAB on June 16 hosted the state qualifyingtournament for 42nd Trusted Choice Big “I”National Championship. Eight youth golferscompeted at Garrisons Lake Golf Club.

Aaron Burton, of Wilmington, advanced to the national tournament, held July 27-30 inChesterfield, N.J. Burton, who representedDelaware last year as well, had a strongshowing but did not make the cut.

Thank you to Harleysville Insurance and Cumberland Insurance Group forsponsoring the Delaware qualifier.

DCRB pipelineTips and tidbits,direct from DCRB The Delaware Compensation Rating Bureau (DCRB) revised Codes 005, TreePruning, and 012, Landscape Contractor, as of June 1, 2009.

Since its 1939 inception, Code 005 fell under the strictest of guidelines. Then a DCRB review found that no other jurisdiction’s restrictions were as stringent at Delaware’s when handling the dual use of classes equivalent to Codes 005 and 012.

The revision ends the prohibition of payrolldivision between Codes 005 and 012 at thesame location or job site. Additional Code 005 revisions clarify the inclusion of groundcrews whose work at a tree-work job site or location is incident to the tree job.

G16030_06-07DE.qxp:Sept2010 8/16/10 12:36 AM Page 3

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

[ 8 ]

CURTIS M. PEARSALLCPCU, AIAF, CPIA

Curtis M. Pearsall contributed

this article on behalf of Utica

Mutual Insurance Company in

Utica, N.Y.

Insurance Agents & Brokers

Service Group Inc. is the

exclusive agent for the Utica

E&O program in Delaware,

Maryland and Pennsylvania.

For questions regarding this

article or your Errors &

Omissions coverage, contact

IA&B at (800) 998-9644 or by

e-mail at [email protected].

WRITING COMMERCIAL AUTO? When an E&O claim happens, it can be huge!

Primary Agent | September 2010

If your agency writescommercial business, there isa good chance you writeCommercial Auto for many ofthose customers. For some ofthose risks, the vehicles maybe more private passengerautos, while for others theexposure may include vansand trucks of various sizes.Bottom line, while “errors oromissions” when writingCommercial Auto onlyamount to around 6 percentof all E&O claims, when theclaims happen, they tend to be much larger than other coverages.

While writing CommercialAuto for your customers is notoverly complex, it certainlydoes require knowledge — notonly of the coverages, but alsoof your customer, what thevehicles are used for and whois using them. Effective use ofan Exposure Analysis Checklistis strongly recommended.

One of the main issues with a Commercial Auto policy isthe symbols used to indicatewhat vehicles are included inthe coverage.

The applicable symbols areexpressed in numbers,ranging from “1” to “9.”Symbol “1” is the broadest –providing coverage for anyauto. Thus, if your customerwere to lease a vehicle for aparticular job, symbol “1”would provide coverage. Onthe other hand, symbol “7” isonly for vehicles listed on thepolicy. There would not becoverage for leased or non-owned vehicles with thissymbol. Symbol “9” is only fornon-owned vehicles. Thus,having a discussion with yourcustomer and getting answersto these questions will bebeneficial when requestingthat coverage be structuredappropriately.

Other CommercialAuto issues“Drive Other Car”coverage/the Named Insured.Offer the owners of thebusiness (where the businessis the named insured)additional “Named Insured”status or “Drive Other Car”coverage. Should abusinessowner be injuredwhile as a pedestrian or as a

passenger in another vehicle,this coverage would beneeded to collect UninsuredMotorist (UM) orUnderinsured Motorist (UIM)coverage from theCommercial Auto policy.

Limits issues. Because of thesize of commercial vehicles,especially trucks, the damagescan be significant when aclaim occurs. While limits of$1,000,000 may sound like alot, claims involving bodilyinjuries can certainly be morethan that amount. Thus,offering an umbrella policy ishighly recommended. Shouldthe insured want lower limits,obtain a sign-off. This sign-offwill be a solid defense shoulda major claim occur and theinsured alleges you had notprovided the proper coverage.When providing an umbrella,be sure to satisfy theunderlying limit requirements.

Adding or deleting the wrongvehicles from a policy. If theCommercial Auto fleet issizeable, maintaining anaccurate list can bechallenging. When the


[ 9 ]

customer requests a modification tothe policy — whether adding ordeleting a vehicle — get the request inwriting. This not only includes thevehicles in question, but the coveragespecific to those vehicles. Request thatthe customer provide the VIN # forthe vehicles being modified. It also isrecommended strongly that, whenmailing the policy to your customer,you advise the customer in writing toread the policy/endorsement toensure there are no mistakes. Asstated previously, if you have symbol“7” coverage and accidentally deletedthe wrong vehicle, there is sure to bea problem should that vehicle beinvolved in a claim.

Replacement of coverage. If acustomer presents an unwantedexposure (such as claims activity,problem drivers, etc.), it may benecessary for you to replace thataccount. If the account presents some challenges, aggressively pursue a replacement policy as soon as you know the carrier is going to get off that account. If itappears that finding replacementcoverage may not be possible,promptly advise your customer. Asyou will note in the claim discussedbelow, not keeping the customerinformed can result in a significantE&O claim against the agency.

Issuing certificates/evidence ofcoverage for vehicles that are notcovered. If requested to provide proofof coverage by issuing a certificate orID card, pull the file to make sure thevehicle is still on the policy and thatthe policy is still active. Remember,too, that the certificate is not a policyand should only reflect the coveragesactually on the policy.

In this E&O claim, the client’sCommercial Auto policy was going tobe non-renewed, and the agency toldthe client it was going to be difficult to

place the risk with a new carrier. Theagency could not find a new carrierand told the client the day before thecoverage was to expire thatreplacement coverage could not befound. The client had to take vehiclesoff the road for two weeks untilcoverage could be secured fromanother agent. The customer wasessentially out of business.

The client sued the agent, stating theagency did not keep the clientproperly informed of the situation,and claimed $679,000 in lost revenue.Although it was believed this was adefensible case, the case went to trial.The jury awarded $500,000 indamages, offset by 40 percentnegligence on the client, bringing theaward down to $300,000 plus interest.In addition, the jury awarded$500,000 for a violation of business

law based on allegedmisrepresentation. Counsel did not believe the judge would allow the $500,000 award for a businesslaw violation to stand, and a hearingon that issue was set for two weeksafter the verdict. The plaintiffsapproached counsel right after theverdict and said they were willing tonegotiate before the Court ruled onthe business law violation. The casesettled for $350,000.

When writing commercial lines, youwill be asked to provide CommercialAuto coverage for the majority ofyour customers. Take the time toeducate your staff and yourcustomers on Commercial Auto. This will go a long way towardensuring you do the proper job eachand every time.


CoverageC O R N E R

[ 10 ]

JERRY MILTON, CIC

Jerry M. Milton teaches

and consults on industry

issues. The legal profession

recognizes him as an

expert on insurance

coverages. He is also the

education consultant for

IA&B, working with CISR,

CIC and continuing

education programs.

CONTRACTS AND CERTIFICATES OF INSURANCE


One of your clients has justbeen hired to do a job. Theowner of the project requiredyour client to sign a contractwhich spells out the terms,conditions and costs of thejob, as well as the penalty fornon-compliance. I don’t needto tell you that the contractyour client signed was writtenby the owner’s attorney.Therefore, it’s written in favorof the owner and is designedto protect owner.

The contract has a sectiontitled “Indemnification.”Under that section your clienthas agreed to save and holdthe owner harmless forcertain losses, claims andexpenses arising out of thejob. Following theIndemnification section, theowner’s attorney listed thepolicies of insurance that yourclient must procure andmaintain – CommercialGeneral Liability, PollutionLiability, Commercial Auto,Workers’ Compensation andBuilders’ Risk.

In addition to requiringcertain policies of insurance,the contract also lists specific

conditions that must besatisfied by those policies:

w Limits (CGL limits mustbe project specific anddedicated solely to yourclient’s ongoing andcompleted operationson this job);

w Owner as additionalinsured;

w All policies of insurancecarried by your clientmust be primary andnon-contributory; and

w Waiver of subrogation infavor of the owner.

Prior to the commencementof any work, your client isrequired to provide the ownerwith certificate(s) of insuranceevidencing compliance withthe provisions of theinsurance requirements.

Certainly, the contractbetween your client and theowner of the project is a legalagreement. Likewise, thecontract of insurance betweenyour client and the insurancecompany is a legalagreement, subject to theterms and conditions of the

insurance contract. Do theinsurance contracts satisfy theterms of your client’s contractwith the owner of the project?Probably not!

First of all, the indemnificationprovisions of the contract withthe owner may be broaderthan the coverage providedunder the insurance policies.Insurance may pay some, butnot all, of the obligationsassumed in the indemnityagreement. Insurance iscompletely independent ofthe obligation to indemnify.

Now you have to issue acertificate of insurance. Justexactly what is a certificate ofinsurance? Blacks LawDictionary defines a certificateof insurance as a “documentevidencing fact that aninsurance policy has beenwritten and includes astatement of the coverage ofthe policy in general terms.”

Will the certificate meet therequirements of the indemnityagreement? Probably not. Willthe certificate stipulate that allof the insurance requirementshave been met? No.


[ 11 ]

What does the certificate really show?Many folks say it is a snapshot of thepolicy coverages and limits at the timethe certificate was issued. I disagree.The certificate will show the limits thatwere in effect when the policy wasissued. However, because of previousclaims, the aggregate limits of thepolicy may have been reduced, unlessthe proper endorsements are attached.

Can there be a conflict between thecertificate and the policy? What if thecontract required that the owner benamed as an additional insured forboth ongoing and completedoperations? Will the insurancecompany comply? Maybe for ongoingoperations, but maybe not forcompleted operations. How do youindicate this on the certificate – owneras “additional insured” or owner as“additional insured for ongoingoperations only”?

If there is a conflict between thecertificate and the policy, whichdocument prevails – the certificate orthe policy? The large majority of courtshave ruled in favor of the policy.However, a few courts have stipulatedthat the terms of the certificateoverride the terms of the policy.

Currently 35 states, includingPennsylvania and Maryland, havepassed laws or regulations or issuedbulletins governing certificates ofinsurance. Pennsylvania Notice 2009-02, issued Feb. 13, 2009, and MarylandBulletin 08-34, issued Nov. 7, 2008,address the penalties for issuing acertificate that does not accuratelyreflect the terms and conditions of theinsurance policy. Penalties couldinclude revocation of license as well asmonetary fines.

One final thought: I hope all of you areusing the new ACORD Certificate ofLiability Insurance (ACORD 25 2009).The cancellation provision states,“Should any of the above described

policies be cancelled before theexpiration date thereof, notice will be delivered in accordance with thepolicy provisions.”

This is great wording. If the policy iscancelled, now the certificate holder issubject to the same terms as thenamed insured.

Y’all take care!

Editor’s note: Learn more aboutcertificates of insurance on IA&B’sWeb site. Visit iabgroup.com andchoose “Agency Operations” from themenu bar.


TECHNOLOGY

Like it or not (andunderstand it or not),there’s no denying socialnetworking’s explosivetakeoff over the past year.The social Web istransforming how weconnect with family, friendsand customers. Thefollowing pages offer expertinsight on the industry’sadoption of socialstrategies.

The social networking trainhas left the station Industry expert talks Web 2.0

G16030_12-19PrimAgSept2010.qxp:Sept2010 8/6/10 2:40 PM Page 12

[ 13 ]


Steve Anderson is serving as an advisor for curriculumdevelopment for IA&B’s Oct. 26-27 ExecutiveManagement Conference (see page 14). A nationallyrecognized authority on insurance technology and a

licensed independent agent for 30 years, Anderson willpresent sessions on social media, agency managementsystems and technology trends.

Here, Anderson talks with IA&B about social networking(think: Facebook, Flickr, LinkedIn, Twitter and YouTube, toname a few) and the independent agency system.

IA&B: Independent agents, as a whole, have been slow toadopt social networking. What do you see as the biggeststumbling blocks?

Steve: Probably the biggest issue that comes up is agencyowners saying they’re just going to waste their time. There’s hesitation to let staff access Facebook, YouTube and LinkedIn, and there’s skepticism that these are businesstools as opposed to personal, stay-in-touch tools. Also,agency owners ask, “What are the E&O implications?” and“How do we manage it?” Those are the most commonobjections I hear.

————————————————————————

“These are just different ways of doing thenetworking [agents] have always done.”

————————————————————————

It’s very similar to when owners first brought Internet intoagencies. They worried that staff would spend all day buyingbooks on Amazon or surfing the net. Yes, it can happen. Butagency owners can manage expectations, explain that this isnot for personal use but for interacting with clients. And theycan treat problems as an exception, not the rule.

Some think this is just fun for kids, but user demographicssuggest that’s not the case. It’s becoming fairly evident thatagencies are successfully using these tools for prospectingand keeping in touch with clients. It’s just a learning process.

IA&B: You were an early adopter of the social Web. What weresome of your hesitations, and how did you overcome them?

Steve: Yes, I was a fairly early adopter. Certainly with Twitterand some of the other tools, I wondered “So what?” Part of[my hesitation] was, “Do I have time to do this?” and “Howmuch information do I want out there?” That’s one questionthat, even today, people need to ask: “How comfortable am Isharing information?”

Social media primerConnecting on LinkedIn. “Friending” onFacebook. Following on Twitter.

Curious what the buzz — and the jargonthat goes along with it — is all about?Here’s a brief synopsis of a few top socialspaces.

LinkedIn (www.linkedin.com): The aim of this site is to connect professionals. Users create a resume-like profile andthen reach out to past and presentcolleagues to create an online directory ofcontacts. They can also reach out to theirconnections’ connections to create newcontacts and join in online discussions.

Chamber of Commerce dinners are soyesterday. Now people rub elbowselectronically and network online.

Facebook (www.facebook.com): This sitealso encourages users to create profiles(called “walls”) and connect withacquaintances (called “friends”). The focusis more social than professional, and userssend messages, play games and postpictures, links and status updates. Theyjoin groups and endorse (called “like”)people, products and companies.

Forget the class reunion. People youngand old reunite with old friends and share photos online.

Twitter (www.twitter.com): This siteallows users to post text-based messages(called “tweets”), with a maximum of 140characters, in answer to the question“What are you doing?” Users post statusupdates and links, and they track (called“follow”) other users’ posts. While postsare public for everyone to read, users cansend private notes (called “directmessages”) to other users.

Gotta know something pronto? Twitter iswhere it’s at. From news to babble,information is shared at lightening speed.

S


I liken a number of these tools— Facebook, Twitter and, froma professional side, LinkedIn— to the networking agentshave built their business on.These are just different waysof doing the networkingthey’ve always done. Agentstell me that they don’t want to tweet about what they hadfor lunch. Neither do I. I talkabout what is of value andwhat is of interest.

__________________________

“People want to buy from people they know.

One of the things [social networking] allows is for people

to get to know us better.”

__________________________

What I have found is that withall of these tools combinedtogether, I feel moreconnected with people thanever before. I’m able to seewhat’s going on. When I talkto people – and I still do – theconversation changes. Insteadof asking, “How was yourweekend?” I can say, “I sawyou were at a play, how wasit?” The conversation goes to another level more quickly because I alreadyknow some information.

For agencies, people want to buy from people they know. One of the things [social networking] allows

continuted on page 16

TECHNOLOGY

[ 14 ]

IA&B’S EXECUTIVE MANAGEMENTCONFERENCEWelcome to the information age, where advancements occur at a more rapid pace –and have a greater influence on daily existence – than ever before.

The independent agency system is not immune. In fact, technology is acting as anequalizer, affecting agencies regardless of sales volume or staff size or carrierrepresentation or lines of insurance sold.

Members spoke, and IA&B recognizes the uncertainties, frustrations and learningcurves that these advances created.

In response, the 2010 Executive Management Conference is dedicated to technology.

The two-day event brings together industry experts on agency management systems, data security, electronic document management and social networking.Seminars offer management-level education with the end goals of improved efficiency and compliance.

Consider this conference the start of IA&B’stechnology dialogue. The association remainscommitted to helping members navigatethese unchartered waters in the months andyears to come.

EMC2.0: Relevant technology forindependent agenciesOct. 26-27, 2010Eden Resort, Lancaster, Pa.

Details and registration areavailable atiabgroup.com/EMC2010.


[ 15 ]

Date Topic Location

1 Workers’ Comp Seminar Mechanicsburg, Pa.

2 Workers’ Comp Seminar Dover, Del.

8 William T. Hold Seminar Altoona, Pa.

CISR—Commercial Casualty Course Allentown, Pa.

Member Agent Panel Gaithersburg, Md.

9 CISR—Commercial Casualty Course Philadelphia, Pa.

Member Agent Panel Bowie, Md.

Member Agent Panel Towson, Md.

13 CISR—Personal Auto Course Mechanicsburg, Pa.

Member Agent Panel Mechanicsburg, Pa.

14 CISR—Personal Residential Course Mechanicsburg, Pa.

Member Agent Panel Altoona, Pa.

15 CISR—Agency Operations Course Mechanicsburg, Pa.

CISR—Personal Residential Course Hunt Valley, Md.

Member Agent Panel Meadville, Pa.

Member Agent Panel Cranberry Twp., Pa.

16 CISR—Commercial Property Course Mechanicsburg, Pa.

Member Agent Panel Greensburg, Pa.

17 CISR—Commercial Casualty Course Mechanicsburg, Pa.

21 Member Agent Panel Moosic, Pa.

Member Agent Panel Breinigsville, Pa.

21-23 P&C Licensing Study Course Allentown, Pa.

22 CISR—Personal Residential Course Cranberry Twp., Pa.

Member Agent Panel Horsham, Pa.

Member Agent Panel Frazer, Pa.

22-25 CIC—Commercial Casualty Institute Harrisburg, Pa.

23 E&O Best Practices Seminar Cranberry Twp., Pa.

Member Agent Panel Dover, Del.

27-29 James K. Ruble Graduate Seminar Erie, Pa.

28 CISR—Personal Residential Course West Chester, Pa.

Workers’ Comp Seminar Allentown, Pa.

29 William T. Hold Seminar Wilkes-Barre, Pa.

Workers’ Comp Seminar Philadelphia, Pa.

30 Dynamics of Service Columbia, Md.

William T. Hold Seminar Mechanicsburg, Pa.

Workers’ Comp Seminar Baltimore, Md.

Glance at EventsS E P T E M B E R C A L E N D A R


is for people to get to knowus better. It creates a betterrelationship, which is what we always say that we want to do.

People are skeptical becauseit’s new and different. Theythink it’s just for kids, but it’snot. It’s relationship building.

IA&B: As a consultant, you helpagencies improve marketingand efficiency. How does socialnetworking fit into that process?

Steve: There are severalaspects. For example,agencies can utilize Facebookadvertising and Facebookpages. Facebook advertising is perhaps the best online toolan agency has because adscan target just the audiencethe agency wants to reach. It’s inexpensive compared toGoogle and other advertisingpossibilities. It allows anagency to get their name in front of a specific group of people.

A Facebook page allows foran extension of an agency’sWeb site. It’s a communityplatform to haveconversations. Most agenciesaren’t utilizing it quite yet, but a few are and really arestarting conversations. Andwhen a client likes theagency’s page, all of theclient’s friends see that. It’spart of networking. It’s not aquick fix, but it’s building acommunity and having peopleknow you’re there. Over time,people want to interact.

IA&B: From a managementperspective, what should beconsidered before launching asocial Web presence?

Steve: It needs to fit into anagency’s overall strategic plan.Determine what the agency’smarketing plan is, and thenlook at how social Web toolscan help.

__________________________

“People are skepticalbecause it’s new and

different. They think it’sfor kids, but it’s not. It’srelationship building.”

__________________________

Initially, an agency can assignsomeone — someone wholikes to learn — and give themtime to experiment and testand then see what makessense for the agency to do. Ifthe agency is a largecommercial agency, Facebookis probably not worth a wholelot. That’s more of value for apersonal agency or a smallcommercial one. However,LinkedIn would allow thatlarge commercial agency tointeract and research.

It depends on the agencystrategy as far as what makessense. Although most everyagency should think about ablog, how to set it up andhave people write. Mostagencies get really nervouswhen they think about writingand worry that they don’t have

TECHNOLOGY

[ 16 ]

Read more onlineIA&B’s Web site is rich with resources.Find the following social networkingtips, tools and insights by visitingiabgroup.com, selecting “Technology”from the menu bar, and thenchoosing “Other resources.”

w How to engage the changinginsurance consumer

w Is there a blog in your future?

w Social networking’s value toinsurance agents and brokers —making the case

w Tools for the successful agent of tomorrow

Continuted from page 14


enough material. In reality, theyhave plenty of material.Questions from clients andinformation in proposals can berepurposed. It all goes back tooverall strategy – why and whatyou want to do with it.

As I mentioned before, astumbling block for managementis “Will it be abused?” That’s whyit’s important to have clearexpectations and guidelines [for staff]. Most of it should already be in an Internet usage policy, soreemphasize that.

IA&B: Surely you’ve seen agenciesthat use the social Web well – andthose that do not. What overridinglessons can you share?

Steve: Those who succeed haveexperimented and failed andkept at it. There’s no one way todo it. It’s how you create acommunity and interact.

__________________________

“Those who succeed haveexperimented and failed

and kept at it.”

__________________________

One thing that’s key to success isnot sending out marketingmessages. This is not aboutsending direct mail letters orblasting out e-mails. [Socialnetworking] is about answering

questions and creating aconversation. You don’t wantpeople to think you’re trying tosell something. Instead, createrelationships so when peoplehave an issue or problem, theywill come to you.

[ 17 ]

Stability Security Sensibility

Leading Insurance Group Insurance Co., Ltd. is a licensed commercial insurance carrier providing competitive rates on property and casualty insurance to business owners in NY, NJ, CA, IL and PA. We spare no effort in providing our utmost products and prompt service for any and all of your insurance needs.

Leading Insurance Services, Inc.US Manager for Leading Insurance Group Insurance Co., Ltd.

Building and Building Owners Business Personal PropertyDry Cleaners Retail StoresPharmacies Pizzerias / Takeout

Apartments Office BuildingConvenience Store Risks DistributorsLiquor Stores Condo / Co-opLRO Buildings

(source by www.ambest.com)

Business OwnersProgram

Commercial Package

LIG offers up to $ 5,000,000 above LIG BOP and Package

NJ [email protected]

www.ligicus.com400 Kelby St., 15th FloorFort Lee, NJ 07024T. (201)720-2100 F. (201)720-2119

505 N. Brand Blvd. Ste 1025Glendale, CA 91203T. (818)254-1040 F. (818)254-1039

LIG Umbrella Policy

Formerly LG Insurance



The Main Street America Group’srich history began in 1923 whenwe formed our company to serve

the insurance needs of Grangefraternity members in New England.Today, Main Street America serves theinsurance needs of individuals,families and small businesses in 25states. We provide a full line ofcompetitively priced personal linesand commercial lines products andservices, as well as fidelity and suretybond products, and annually writenearly $815 million in premium.

Through our five “A” rated propertyand casualty carriers — NGMInsurance Company, Old DominionInsurance Company, Main StreetAmerica Assurance Company, MSAInsurance Company and Great LakesCasualty Insurance Company, as wellas our Grain Dealers Mutual InsuranceCompany affiliate, we partner with

more than 1,500-plus independentagents to provide superior, personalservice to more than 600,000policyholders.

As a founding company partner ofTrusted Choice®, Main Street Americais 100 percent committed to theindependent insurance agent, as youare our sole channel of distribution.We strive to meet the needs of ourcustomers (agents), and ourcustomers’ customers (policyholders),better than anyone else in the market.To become our customer andrepresent Main Street America, please visit www.msagroup.com andclick on the “Become a Main StreetAmerica Agent” link.

**A.M. Best’s rating of “A” (“Excellent”) applies to The Main Street America Group. Ratings listed hereinare as of April 1, 2010, are used with permission ofA.M. Best, and are subject to changes by the ratingservice. For more information about ratings, pleaseaccess www.ambest.com.

Insurance Agents & Brokersproudly recognizes The Main

Street America Group as one ofits Platinum Partners. IA&BPlatinum Partners dedicate

the highest level of sponsorshipto our organization.

FEATURED PARTNERThe Main Street America Group

CHIEF EXECUTIVE OFFICERTom Van Berkel, Chairman

President and CEO

CORPORATE HEADQUARTERSJacksonville, Fla.

Regional OfficesGrand Rapids, Mich.

Indianapolis, Ind.Jacksonville, Fla.

Keene, N.H.Richmond, Va.Syracuse, N.Y.

Claims Service Center Auburn, Mass.

A.M. BEST RATING“A” (Excellent)**

Platinum Profile

“Independent agents have more

than 50 percent of the overall

market. You offer your customers

choice, expertise and advocacy.

No one else can offer that. This is

why consumers prefer your

distribution channel.”

— Tom Van Berkel, Chairman,President and CEO


WHAT IS IA&BPARTNERS?The IA&B Partners

program gives company

and allied businesses

the opportunity to

demonstrate their

commitment of support

to independent agents

and receive maximum

market exposure. As an

IA&B Partner, you will

also realize the benefits

of IA&B membership to

help you succeed in

the insurance industry.

DO YOU SEEYOUR NAME?To become an IA&B Partner,

choose the sponsorship

package that matches your

commitment of support.

Contact the Member Sales

Center at (800) 998-9644,

(717) 795-9100 or visit us

online at www.iabgroup.com

to get started.

Listed below are those companies that strongly support the independent agency

system and Insurance Agents & Brokers.Thank you for your continued sponsorship.

PLATINUM LEVELACUITYBerkley Mid-Atlantic GroupErie Insurance GroupHarleysville InsuranceInsurance Agents & BrokersService Group IncMillers Mutual GroupMillville Mutual Insurance CoMutual Benefit GroupOhio CasualtyPenn National InsuranceSelective Swiss ReThe Main Street America GroupTravelersUtica National Insurance Group

GOLD LEVELAllied InsuranceMMG InsuranceProgressive

SILVER LEVELAmerican Mining Insurance CoCumberland Insurance GroupDonegal Insurance GroupFrederick Mutual Insurance CoHarford Mutual Insurance CoJuniata Mutual Insurance CoPSBA Insurance TrustThe Motorists Insurance GroupWestfield InsuranceZenith Insurance

BRONZE LEVELAegis Security Insurance Co

Agency Insurance Company

Auto-Owners Insurance Company

Briar Creek Mutual Insurance Company

Builders Insurance Group

Chubb Group of Insurance Companies

Encompass Insurance

First General Services

Foremost Insurance Group

Goodville Mutual Casualty Company

Grange Insurance Companies

Hanover Fire & Casualty Insurance Company

Insurance Alliance of Central PA Inc

Insurance Placement Facility of PA

Keystone Insurers Group Inc

Lebanon Mutual Insurance Company

Mercer Insurance Group

Merchants Insurance Group

Mercury Casualty

Penn Millers Insurance Company

Penn PRIME Municipal Insurance

Reamstown Mutual Insurance Company

Rockwood Casualty Insurance

State Auto Mutual Insurance Company

TAPCO Underwriters Inc

The Brethren Mutual Insurance Company

The Mutual Service Office Inc

Tuscarora Wayne Insurance Company

Primary Agent September 2010


COVERAGES

Cyber insurance maysound best suited forVulcans or Klingons. But humans, the future ishere. Read on to learn howto live long and prosperfrom the salesopportunities these newexposures present.

Cyber coverage: the new‘must-have’ in the P&Cportfolio?Businesses from the local doctor’s office to Fortune 1000 rely on IT


[ 21 ]


If current trends continue, cyber insurance coverage just maytake its place alongside workers’ compensation, generalliability, fire and auto insurance in the core commercialproperty and casualty package, meaning a business would

be foolish to open its doors without it.

The reason is simple. Virtually every modern enterprise —fromthe local doctor’s office or supermarket to Fortune 100corporations — lives and breathes on its information technologyapplications, databases and computer systems.

When IT goes down, business screeches to a halt.

Indeed, for businesses such as online retailers, brokerages andsome financial firms, the IT and data assets are the entirebusiness — every bit as critical as the factory and warehouseare to the hard-goods manufacturer, or the vehicle fleet to atrucking company.

Imagine Amazon.com or a regional bank trying to do businesswithout their databases and computer systems.

As more and more companies — and their insurers — arerealizing, this reliance on IT creates a hornet’s nest of risks thatcan result in crippling losses that conventional, turn-of-the-century P&C insurance coverages won’t respond to. These newissues call for a new category of coverage.

_________________________________________________

Reliance on IT creates a hornet’s nest of risks that canresult in crippling losses that conventional, turn-of-the-

century P&C insurance coverages won’t respond to.

_________________________________________________

The new risksOn the one hand is the issue of first-party losses. These mightinclude business interruption, which could be caused by a floodor fire in a data center, or malicious hacking by a disgruntledemployee or even a cyber-crook half a world away.

Traditional P&C insurance might help replace some of the losthardware or compensate for physical damage to the data center.Yet there is no coverage for the onerous costs of restoring data,reinstalling software, or for lost revenue, since standard P&Cpackages typically exclude such losses completely.

It means a company could be out of business for days or weeks, while also being responsible for costs of restoring the IT functionality.

Perhaps even more ominous are the all-new liability exposuresinherent in IT operations. A raft of relatively new regulationsand legislation makes companies responsible for safeguarding

Putting cyber insuranceon the booksCongress is considering several pieces oflegislation that would addresscybersecurity and related insurancecoverages.

Of the bills currently in the hopper, mostwould address Internet security and laythe groundwork for government andprivate-sector collaboration. Some alsowould require an executive branch reportto Congress on “the feasibility of creatinga market for cybersecurity riskmanagement.”

SB 2489, introduced in June andsponsored by Sen. Joe Lieberman (I-Conn.), already passed out ofcommittee and is awaiting a full vote onthe Senate floor. It calls for acybersecurity-oversight entity to behoused within the Department ofHomeland Security. A companion bill, HR5548, has yet to see movement.

A competing Senate bill, sponsored bySen. Kit Bond (R-Mo.), would allow thePresident to create (and the Senate toconfirm) an independent oversightposition. This legislation has yet to betaken up in the chamber.

Note: This legislative update was current as thisissue of Primary Agent was compiled. Since then,Congressional activity may have advanced oraltered cyberliability legislation.

I


personal and confidential datathey collect as part of everydaye-commerce operations.

Companies are liable forcustomer credit card numbers,financial transactions, medicalhistory, credit information andother sensitive data.

Regulations ranging from HIPAA(the Health Insurance Portabilityand Accountability Act) for healthcare information to Sarbanes-Oxley and an array of state lawsprovide stiff penalties forcompanies that mishandle data,permit leaks or unauthorizedaccess, or otherwise fail tosafeguard sensitive information,which conventional insurancewill not cover.

____________________________

Thanks in part to an overallsoft market, capacity for

cyber coverage is abundantat this point.

____________________________

There is also the risk of beingsued by third parties forsomehow allowing — or failingto prevent — unauthorizedaccess to sensitive information.

An example of this would be anoverseas hacker who infiltratesan online shopping Web site andsteals hundreds of thousands ofcustomer credit card numbers.The Web site now faces claims

from angry customers forunauthorized charges made ontheir credit cards, as well asclaims from banks that issuedthe cards for costs incurred incanceling and reissuing them.

Traditional insurance simply willnot apply here.

The new reality is that criminals,terrorists and insiders arebeginning to recognize that thereal Achilles heel of today’scompanies and organizations isthe IT side of their businesses.Secrets, sensitive data and insideinformation have now becometheir prime targets.

Continued on page 24

COVERAGES

Driving members to distinction

MAKING TRAINING AWORTHWHILE INVESTMENT

FOR INSURANCE PROFESSIONALS,TIME IS MONEY. Invest your time wisely with IA&B. IA&B trainingprograms maximize your time out of the office byteaching you practical, up-to-date and relevantinformation.

Stop taking classes that are a poor investment of your time and money. Look to IA&B for all of your training needs.

FOR MORE INFORMATION, VISIT IABGROUP.COM OR CALL THE IA&B MEMBER SERVICE CENTER AT (800) 998-9644.

That’s how we deliver distinction.


For All That Matters

www.acuity.com

A.M. Best A+

Get Ready Pennsylvania.Here Comes ACUITY !

For All That Matters

Interested in an agency appointment?Please contact Territory Director

Steve Harris at 717.756.9983

www.acuity.com


The insurance optionsSince common P&C insurancecoverage doesn’t respond tomost IT and privacy-relatedlosses — and are in factspecifically excluded in mostforms — major carriers andspecialty insurers are nowoffering an array of cyberproducts designed to address thecritical gaps.

These cyber products—usuallycalled “Network Security andPrivacy Liability” policies—tendto vary significantly from carrierto carrier, as the markets try todiscern what provisions andterms prove most attractive toenterprise customers at different

levels of risk. The situation issimilar to where employmentpractices liability insurance wasjust a few years ago.

The Network Security andPrivacy Liability policies aregenerally designed to addressfirst-party risks and third-partyliability — sometimes in thesame policies, sometimesseparately.

First-party coverage typicallyincludes:

w Business Interruption

w Data Restoration

w Cyber Extortion Payments

w Crisis Management Expenses

w Media/Intellectual Property

w Regulatory Actions

w Expenses to Notify AffectedParties

w Expenses to provide creditmonitoring

w Forensic costs to determinehow the breach occurred

w Transmission of avirus/worm

w Loss or damage to anorganization’s own network,or e-theft

The third-party side usuallyaddresses liability arising fromnetwork and informationsecurity, privacy liability andelectronic media.

Depending on the nature of acompany’s operations and ITstructure, insureds can negotiatea number of coverageenhancements that addresssituations not covered in thecore policy.

1. Coverage could beextended to cover theactions of “rogue”employees, authorized staffacting in an unauthorizedmanner, or to independentcontractors or outsourcers.

2. Coverage could also beextended to cover off-lineor non-electronic data thatcontains sensitive orprivate data, and issomehow breached orreleased.

3. First-party expenses mightalso be negotiated for thecosts of restoring a network

COVERAGES

[ 24 ]

STRONG RELATIONSHIPSPRODUCE RESULTS

Celebrating 166 years of service � 1844 - 2010

There is no better time tobecome part of The CumberlandInsurance Group Team. We arenow appointing agents in CentralPennsylvania.

G R O U P1844

MI N E R V A

CUM

BER

LAND INSURA

NC

E

Contact Amber J. Ayrerat 800-232-6992, ext. 1237 [email protected]

Commercial and Personal LinesCompetitive CommissionsExceptional Customer ServiceFinancial StrengthExperienced UnderwritersMarketing Support

Continuted on page 26

Continued from page 22


ABSOLUTER I S K P L A C E M E N T

Call for info 877-390-7475

Does your agency need market access?

Are you having difficulty placing coverage?

Help is on the Way….Absolute Risk Placement is a multi-line insurance brokerage providing skillful market access and related services to a select group of independent insurance agents and brokers.

We are known for our ability to provide products that are comprehensive and cost effective. Our capable, experienced staff stands ready to assist you with many kinds of insurance placements.

In addition, we have access to many aggressive “small business” markets that can provide fast, competitive products for you.

We’re looking for strong partners. Find out how to do business with us, it’s easy.

Visit us online www.absolute-risk.com

Health CareSkilled and Assisted Care FacilitiesHospitalsHome Health AgenciesHospiceMiscellaneous (Laboratories/Clinics/Urgent Care)

ConstructionStreet & RoadGeneral ContractorsExcavation/Utility ContractorsIron/Steel Erection

TransportationLong Haul (minimum of 5 power units)Motor Coach/School BusSand & Gravel

EnvironmentalRemediationLandlord/Property DevelopmentEngineeringMunicipalIndustrial

Our core practice areas include:

Visit us online at www.absolute-risk.com and click on the “Become an ARP Producer” tab.

Or contact Tim O’Brien at [email protected],or by phone at 877-390-7475 x128.

Help is on the Way….

.....................................


IF YOU HAVE THE TOOLS,WE HAVE THE INSURANCE.

Residential Contractors with up to 5 employeescan find great deals on liability insurance atBrokers Surplus Agency. We represent Utica First Insurance, one of the largest writers of small contracting firms in the Northeast, and we cangive you a free quote on all your coverage needs!Call or email us today!

Contact: Dennis Marsaglia, Ext. [email protected] Frisch, Ext. [email protected]

Brokers Surplus Agency, P.O. Box 2849,Warminster, PA 18974 � Call (215) 443-9900

Make Our Experience,Your Advantage.

200 North Main Street • Bel Air, Maryland • 21014-3544

Join our team today. Contact us to learn more:

www.harfordmutual.com800-638-3669

after a breach,investigations of thebreach, costs ofworkarounds, or short-termservices to restorefunctionality.

4. Defense costs, civilpenalties and fines due toregulatory actions, as wellas amounts that must bedeposited into redress orsettlement funds.

Underwriting cyberThanks in part to an overall softmarket, capacity for cybercoverage is abundant at thispoint; however, one sector that

is facing increased underwritingscrutiny is the financialinstitutions segment.

____________________________

The more businesses relyon information technologyas an engine for operations

and communication, themore crucial it becomes toprotect IT assets with the

right coverage.

____________________________

In addition to evaluating basicslike revenue, employee countand the nature of the business,underwriters take into account

the technical safeguards acompany has in place, its overallprivacy and security policies —and occasionally, therecommendations of an outsideconsultant or security auditor.

Underwriters may also requirecertain upgrades to proceduresor technology as a condition ofthe insurance.

In designing insurance coveragefor an enterprise, agents andinsureds should start with athorough assessment of potentialrisks and vulnerabilities of theexisting systems, perhaps withthe help of a security specialist,and then secure the appropriateinsurance coverage.

COVERAGES

Continuted from page 24

[ 26 ]


EICELIZABETHTOWN INSURANCE COMPANY

56 N Market Street, Elizabethtown, PA 17022www.e-townins.com

SERVICE and STABILITY since 1844

Does your agency need a carrier that provides outstanding service

to both you and your clients?

We offer products to protect your personal and commercial lines clients. Our service is outstanding, our pricing is competitive and we do not use credit scores as part of our underwriting process. Our

sharing program that includes production incentives.

If you would like to learn why a partnership with EIC is a great choice for your agency, please contact Lynn Reynolds at [email protected] or call her at 800-736-8112, extension 404.

Homeowners & Dwelling Coverage HO 3, HO 6Replacement Cost on Building and Contents available Named Storm Deductible Backup of Water & Sewer available Mold Coverage available 1-4 Family Dwellings Vacant Buildings

Tri-State General Insurance Agency1-800-556-7894

We write more than just “trucking” - Visit us at www.tsgia.com

Fast, Friendly Service On line quoting available

Property Casualty Underwriter

Property Casualty Underwriter

Beverly Pusey x230 [email protected]

Michelle Dickerson x223 [email protected]

Maryland * Pennsylvania * Delaware * DC * Virginia * New Jersey

Network Security and Privacy Liability insurance isjust another important component of a riskmanagement strategy in today’s businessenvironment. The more businesses rely oninformation technology as an engine for operationsand communication, the more crucial it becomes toprotect IT assets with the right coverage.

________________________________

Rick Grimes and Karen Kuger authored this article.

Rick Grimes is an executive vice president for ProfessionalRisk Solutions, a wholesale insurance broker that placesdirectors and officers, errors and omissions and cybersecurity and liability coverages headquartered inSomerset, N.J. Mr. Grimes may be reached [email protected].

Karen Kutger, vice president and branch manager for thePhiladelphia branch of Professional Risk Solutions, may bereached at [email protected].

This article originally appeared in National Underwriter.

[ 27 ]


ACUITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23

Absolute Risk Placement . . . . . . . . . . . . . . . . .25

Brokers Surplus Agency . . . . . . . . . . . . . . . .1, 26

Cumberland Insurance Group . . . . . . . . . . . . . .3

Cumberland Insurance Group . . . . . . . . . . . . .24

Elizabethtown Insurance Co . . . . . . . . . . . . . . .27

Goodville Mutual Cas Co . . . . . . . . . . . . . . . . . .5

Harford Mutual Ins Co . . . . . . . . . . . . . . . . . . .26

Harleysville . . . . . . . . . . . . . . . . . . . . . . . . . . . .IFC

IA&B Partners Program . . . . . . . . . . . . . . . . . . .19

IA&B Series Ads . . . . . . . . . . . . . . . . . . . . .22, IBC

Interstate Insurance Mngmnt. . . . . . . . . . . . .OBC

LIG Insurance Co . . . . . . . . . . . . . . . . . . . . . . . .17

Penn National Insurance . . . . . . . . . . . . . . . . . .11

Preferred Property Program . . . . . . . . . . . . . . . .9

Tri-State General Ins Ag . . . . . . . . . . . . . . . . . .27

Ad Index

ClassifiedA D V E R T I S E M E N T S

SOUTHEAST PA PRODUCERS & AGENCIES

Professional agency since 1926 locatedin Feasterville, Bucks County, Pa. Call for confidential information and a review of our services. Contact Ray Reinard at (215) 375-8600, Ext. 119.

LOOKING TO BUY!

Agency in Snyder, Union andNorthumberland Counties. All inquiries kept confidential.Call Gary at (570) 524-7670.

If you would like to place a Classified Advertisement, simply fax your ad on company letterheadto (717) 795-8347, and we will take care of the rest.

[ 28 ]

10 most dangerous drivers by profession*1. Attorney/Judge – Why chase ambulances if you

can bring them to you?

2. Financial professionals – Do they cover their carswith a “tarp”?

3. Government worker (GS6) – Fender benders area little known GS6 requirement.

4. Bartender or Waiter – It’s just a different way ofgetting served.

5. Other – Professional – AKA “I was hit by that‘other’ guy.”

6. Dog Groomer – Following the rules of the roadmust be a real pet peeve.

7. Marketing/Advertising – If they have road rage,can we call them “Mad Men”?

8. Barber/Stylist – Mostly likely to cut you off.

9. Coach – Always crying foul.

10. Nurse – Bedside manner: Great! Roadsidemanner: Yikes!

Least dangerous drivers?Athletes and homemakers.

* Compiled from 2010insurance.com data.

Source: www.insurance.com

----------------------------------------------------------------———————-------The Last & Least column is dedicated to the industry’s oddities —from creative claims and kooky coverages, to (tasteful) jokes andstrange stories. Submit yours to [email protected], subject line: Last & Least. The editor will happily protect sources’ anonymityupon request.


Join IA&B for its Executive ManagementConference. In an age where technologicaladvances are changing the ways you do business, you can’t afford to be left behind. IA&B will show you how to harness the power of technologythrough agency management systems, datasecurity, electronic document management and social media to make your agency more efficient and productive.

Visit iabgroup.com/EMC2010 for program details.

Driving members to distinction

2010 EXECUTIVE MANAGEMENT CONFERENCEEMC2.0: Relevant Technology for Independent Agencies



Documents

Primary Agent - September 2010 - DE Edition