Industry News

(Left to right) Bill Hartnett, Keith Savino, Mike Becker

Just what does the independent agent “Buy Button” mean? How could utilizing technology to allow an agent to bind policies in real time anywhere he or she decided—in person by the agent during a consultation, or after hours on the agent’s website by the customer—be an advantage? What are the possible pitfalls?

The Buy Button is being likened by its advocates to earlier milestones in technology development in the insurance industry.

ACORD’s Bill Hartnett discusses these issues with PIA’s Mike Becker and Keith Savino, following up on an industry-wide discussion session that was convened by PIA in January and held at the headquarters of ACORD in Pearl River, New York. [video]

Sen. Ben Nelson—Doing The Right Thing: On January 31, 2016, Senator Ben Nelson stepped down after three years as CEO of the National Association of Insurance Commissioners (NAIC). For the past 50 years, no one person has done more to ensure that the insurance industry of the United States has a firm, sensible, state-based regulatory system.

Last month, PIA published Part One of a two-part interview focused on Nelson’s insurance career. In this month’s Part Two, Nelson reflects on his political career, his accomplishments, his role in the Affordable Care Act (ACA) and what he thinks it will take to end the gridlock on Capitol Hill.

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PIA National Executive Vice President & CEO Mike Becker discusses the need to determine what customers want, then deliver it, in an op-ed in Insurance Journal. He discusses the research findings regarding the current buying preferences of our customers, compiled by The PIA Partnership. He also talks about an industry meeting PIA held to discuss the inability of a consumer to bind a policy on an independent agent’s website.

“The customer is always right. This is such a simple concept, but it often gets lost. Only by listening to your customers can you find out what they want. If we listen and then deliver accordingly, we will thrive. Our customers win, too – and so do our carriers,” said Becker.

PIA’s 2016 Advocacy and Policy Priorities have been released. They include preserving the role of agents in healthcare reform; defending state regulation of insurance; cultivating agent licensing uniformity; promoting small business & tax reform; and safeguarding important property/casualty programs. The full document is available here.

“This Congress has broken free of gridlock to act on many issues to the benefit of professional insurance agents and their customers, approving bills endorsed by PIA,” said PIA National Vice President of Government Relations Jon Gentile. “We look forward to continuing to work with lawmakers to support the independent agency system and Main Street insurance agents everywhere.”

PIA’s 2016 Advocacy and Policy Priorities have been released. They include preserving the role of agents in healthcare reform; defending state regulation of insurance; cultivating agent licensing uniformity; promoting small business & tax reform; and safeguarding important property/casualty programs.

The full document is available at: /docs/2016/piapolicyplan2016/.

“In 2015, PIA had great success in advocating for independent insurance agents at the federal and state level,” said PIA National Executive Vice President & CEO Mike Becker. “PIA successfully defended the independent agency system and advocated on behalf of independent agents at the federal level. We intend to build on that success in 2016.”

PIA helped achieve two victories in the year-end “omnibus” appropriations funding measure: a two-year delay of the “Cadillac Tax,” a 40% tax on certain employer-based health plans, and the passage of the Policyholder Protection Act.

PIA also successfully advocated for the reversal of a $3 billion cut to the Federal Crop Insurance Program. In addition, PIA actively advocated for the passage of the Protecting Affordable Coverage for Employees Act (PACE), enabling states to keep the current definition of a small group market in health insurance at 50 or fewer employees.

“This Congress has broken free of gridlock to act on many issues to the benefit of professional insurance agents and their customers, approving bills endorsed by PIA,” said PIA National Vice President of Government Relations Jon Gentile. “We look forward to continuing to work with lawmakers to support the independent agency system and Main Street insurance agents everywhere.”

PIA National hosted an industry meeting it called on January 21, 2016, at the headquarters of ACORD in Pearl River, New York, to discuss the concept of agents offering a level of purchasing capability on their websites, known as a “buy button.”

More than 50 agents, carriers and vendors attended the session, participating in discussions by three panels. There was a sense among participants that the industry is moving toward an online binding capability that independent agents may choose to utilize. Some participants likened development of a “buy button” capability to earlier milestones in technology development.

There was considerable discussion of whether or not independent agents offering an online purchasing/binding capability on their websites would undermine the agent value proposition, or add to the value that the agent brings to the process.

“We have to recognize as agents, we have an ability to possibly use this technology to reach a market segment that we’re not currently getting to—but yet, we also have to be aware of our value proposition. So, it’s kind of a delicate balancing act,” said PIA National President Robert W. Hansen, Jr.

PIA National conducted this forum to put the topic on the table, with agents and their views at the center of objective discussion, as a means of performing due diligence on an emerging issue.

“This is a new concept for many, so it’s important to carry out due diligence and have objective conversations about the effect it could have on the industry,” said PIA National Executive Vice President & CEO Mike Becker. “We are particularly grateful to ACORD for hosting this meeting, which enabled some the industry’s top forward-thinking leaders to share their thoughts on the matter.”

Stay tuned for additional details on the discussions held at this PIA National forum.

WASHINGTON – The National Association of Professional Insurance Agents (PIA) this week released PIA’s 2016 Advocacy and Policy Priorities, which include preserving the role of agents in healthcare reform; defending state regulation of insurance; cultivating agent licensing uniformity; promoting small business & tax reform; and safeguarding important property/casualty programs.

The full document is available at: /docs/2016/piapolicyplan2016/.

“In 2015, PIA had great success in advocating for independent insurance agents at the federal and state level,” said PIA National Executive Vice President & CEO Mike Becker. “PIA successfully defended the independent agency system and advocated on behalf of independent agents at the federal level. We intend to build on that success in 2016.”

PIA helped achieve two victories in the year-end “omnibus” appropriations funding measure: a two-year delay of the “Cadillac Tax,” a 40% tax on certain employer-based health plans, and the passage of the Policyholder Protection Act, which prohibits federal regulators from using assets designated to pay out insurance claims to “prop up” an affiliated bank.

PIA also successfully advocated for the reversal of a $3 billion cut to the Federal Crop Insurance Program. In addition, PIA actively advocated for the passage of the Protecting Affordable Coverage for Employees Act (PACE), enabling states to keep the current definition of a small group market in health insurance at 50 or fewer employees.

“This Congress has broken free of gridlock to act on many issues to the benefit of professional insurance agents and their customers, approving bills endorsed by PIA,” said PIA National Vice President of Government Relations Jon Gentile. “We look forward to continuing to work with lawmakers to support the independent agency system and Main Street insurance agents everywhere.”

Founded in 1931, PIA is a national trade association that represents member insurance agents and their employees who sell and service all kinds of insurance, but specialize in coverage of automobiles, homes and businesses. PIA members are Local Agents Serving Main Street America^SM. PIA’s web address is www.pianet.com.

As expected, President Obama on Friday Jan. 8 vetoed legislation that would repeal much of the Affordable Care Act (ACA), including a provision repealing the upcoming 40% excise tax on so-called “overly generous” health plans—commonly known as the ‘Cadillac Tax’. Congressional Republicans say they will attempt to override the veto, but admit that they don’t have the votes to do so.

H.R. 3762 was advanced as a political statement. In addition to repealing much of Obamacare, it would also defund Planned Parenthood. The bill was passed by the Senate in December under the reconciliation process, meaning it required only 51 votes instead of 60 to pass and could not be filibustered. The House then passed it on January 7, on a party-line vote of 240-181.

While full repeal of the Cadillac Tax will die along with the broader bill, a budget agreement reached by lawmakers and enacted on December 18 included a two-year delay in its implementation, pushing it from 2018 to 2020.

PIA continues to strongly support repealing the Cadillac Tax entirely, and has endorsed S. 2045 by Sens. Dean Heller (R-NV) and Martin Heinrich (D-NM) in the Senate and a companion bill in the House (H.R. 2050) by Rep. Joe Courtney (D-CT ), who issued a call for repeal in an article he wrote for PIA Connection. The effort to repeal the excise tax on health benefits has attracted broad, bipartisan support.

PIA has praised Congress for reversing a $3 billion cut to the budget of the Federal Crop Insurance Program (FCIP). Restoration of the funds came in the form of an amendment to a highway spending measure that was approved by the House and the Senate on December 3. The legislative action delivered on promises made by congressional leadership to reverse the cuts, which had been included in the Bipartisan Budget Act of 2015 (H.R. 1314).

“This is a significant victory for America’s farmers and for our nation’s entire agriculture sector,” said PIA National Vice President of Government Relations Jon Gentile. “PIA insurance agents around the country engaged in an active campaign of advocacy to get these cuts restored, which contributed to this success.”

On October 30, Congress passed and the president subsequently signed a budget deal to raise the nation’s debt limit. Part of that deal—which had been negotiated in secret between President Obama and former House Speaker John Boehner—included the severe cut of $3 billion to the federal crop insurance program. When this came to light, PIA members inundated Congress with messages urging that no cuts be made to the crop insurance program. House and Senate leaders then quickly pledged to reverse the cuts.

“We are very pleased that Congress delivered on its promise,” Gentile said. “House and Senate leaders quickly responded to the calls from their constituents by pledging to make the crop insurance program whole again. These cuts would have seriously jeopardized the private sector delivery of crop insurance.”

PIA has joined with a coalition of 163 cosigners in sending a letter urging members of Congress to contact Administration officials, and urge them to reconsider proposed changes to overtime pay requirements. On June 30, 2015, the U.S. Department of Labor proposed to amend overtime regulations under the Fair Labor Standards Act (FLSA). The changes would be made to the exemptions for executive, administrative, and professional employees (the “white collar exemptions”).

The Department proposes more than doubling the salary level required to qualify for the white collar exemptions, from $455 per week/$23,660 per year to $970 per week/$50,440 per year. DOL also proposes automatically increasing this minimum salary going forward on an annual basis and publishing the increased minimum salary only 60 days before it becomes effective, with no opportunity for comment or input from employers who will have to comply. The Department is expected to finalize the rule in mid-to-late 2016.

What It Means to Agents: PIA is concerned that the proposed regulations will have unintended consequences for insurance agents and agencies. The proposed regulation, while well intentioned, will be unnecessarily burdensome for PIA member agencies leading to decreased opportunity and flexibility for agency employees.