Not long ago, a newsletter from an insurance agency landed in my email in box. The content in the newsletter appeared to be targeted at the agency’s personal lines clients. The article was all about coverage issues, which I think is a good thing. I’m all for trying to get insurance consumers to focus on the product they’re buying instead of how much they’re paying for it. The gecko and my gal Flo do plenty to emphasize the size of the premium. When independent insurance agents speak with their clients about coverage, they are doing the industry and the public a favor.
Unfortunately, this newsletter missed the mark. The more times I read it, the more I saw it as an example of what not to do. The author’s intentions were good; the execution was not. If your agency publishes a client newsletter, or regularly communicates with clients in some other way (which you should,) then here are some things to keep in mind:
Gather ‘round, young Jedis, for another lesson in why insurance is not a commodity. Today’s tale involves a Homeowners policy, a named insured who complicated matters by not living anymore, some stuff that went missing, and two words.
Our story begins and ends in the burg of Mineral Wells, Texas, where Mr. J.O. Spurlock owned and occupied a home. His Homeowners policy, issued by Beacon Lloyds Insurance Company, listed only him as a named insured. It identified his street address as the “residence premises/dwelling” and provided dwelling and personal property coverage. (Note: Beacon Lloyds dissolved at the end of 2012.)
Okay, so I unintentionally took September off from the blog, but I’m back now. This is a continuation of my series on how insurance policies are not alike (see my posts on May 5 and May 6). The following is an email discussion I had with a Westchester County agent last August. I’ve edited it slightly to remove extraneous detail and to leave the insurer anonymous.
Question: One of our clients recently took delivery of some heavy equipment and asked if there would be coverage for his property if the floor collapsed. Our client is the tenant, not the building owner. The coverage form is the (insurer’s) Special Property Coverage Form, which we believe is the same or almost the same as the corresponding ISO form. I have attached a page from the (insurer’s) policy. Coverage is clear with respect to building damage for collapse caused by weight of people of personal property, but I can’t make sense out of the personal property wording. Do you feel that personal property owned by a tenant of a building would be covered if the building were to collapse due to weight of personal property?
Over this past weekend, the New York Times ran a rather unflattering article about the employment practices at Amazon.com. Titled Inside Amazon’s Thrilling, Bruising Workplace, the article by Jodi Kantor and David Streitfeld described an atmosphere that borders on slave-driving and cruel. They wrote about employees receiving emails after midnight and follow-up text messages when the recipients fail to respond. They quoted an employee who said nearly every person he worked with cried at their desks at some point.
I learned earlier today that the New York State Department of Financial Services has disapproved ISO's filing of endorsements to address the "where you reside" issue. Correspondence in the filing expressed concerns about whether, under some carriers' underwriting guidelines, the endorsements might reduce coverage. The examiner also felt that it was unclear how carriers would interpret them, given the varying underwriting guidelines.
We at IIABNY will discuss this decision and what, if anything, we should do next. For now, though, the ISO Homeowners insurance program will maintain the status quo on October 1.
NPR's excellent Planet Money podcast recently did a show about how we as humans become comfortable with frightening technology. Did you ever wonder why elevators used to have operators in them? It's because, once upon a time, people didn't fully trust elevators and they wanted someone there to take control if necessary.
I have returned this morning from 11 days off. I spent a few days in the Thousand Islands region with some college friends, spent a week with my family on the Jersey Shore, played golf badly, coated myself with SPF infinity sunblock and sat on the beach, read a bunch of books, and pretty much forgot about insurance for two weeks. Today, I bear a striking resemblance to the picture displayed above.
Nevertheless, it's a new dawn, it's a new day ... sorry, lapsed into song for a minute there. But it is a new day, because New York's law governing the use of certificates of insurance took effect one week ago today (I celebrated by taking a nap on the beach in Ocean Grove, NJ.) Accordingly, the questions from IIABNY members have been coming in fast and furious in my absence. There is one question that we've gotten from all corners of the state, so I think it's worth addressing in an addendum to my earlier post about the myths surrounding the law.
In just 18 days, New York’s certificates of insurance law will take effect. The New York State Department of Financial Services has posted an initial list of certificate forms it has approved. We are getting closer to a huge relief for New York insurance producers.
Judging from the emails and questions I’ve been getting, though, there seems to be a fair amount of misunderstanding out there about what this law says and does. So, let’s take a few minutes to dispel some myths.
The New York State Department of Financial Services released its latest periodic disciplinary actions report last week. Compared to some editions, this one was relatively short. A few insurers were taken to the woodshed for violating the laws pertaining to cancellation notices (balance sheets at 21st Century, AXA and MetLife are a tad lighter now than they were in April.)
The good news for agents and brokers was 1) not that many hearings and stipulations; and 2) a lot of the punishments were doled out to out-of-state producers.
Question from an IIABNY member: I am looking to you to help clarify a question I have regarding a “temporary worker” exclusion currently attached to one of my clients policies, attached is a copy for your reference. My insured’s policy is written without a “labor law” or “employee injury” exclusion which she paid a lot more for and is very important because she is a “sub-contractor” for many large companies and signs many project contracts. At the time the policy was written the attached “temporary employee” exclusion did not seem to present too much of an issue because the insured did not anticipate any time that she would need to hire a temporary employee, that is until now. So a few days ago my insured sent me the attached labor firm contract asking me for a certificate of insurance so I immediately went to the carrier for information pertaining to this “temporary employee” exclusion currently on the policy and below is the email thread for your reading pleasure.