The National Flood
Insurance Program (NFIP) is scheduled to expire in two weeks, on July 31,
unless the U.S. Congress acts to extend the program. Please take a moment
to call your federal legislators (below) with the following message. You
will likely speak with a staff assistant that will just take your message down
so don't be intimidated to make a quick call!
"I'm calling to
encourage congress to reauthorize the National Flood Insurance Program before
it expires on July 31st. A lapse in the program, especially during the
height of hurricane season, will leave millions of Americans at risk."
Senator Charles Schumer
Phone: (202) 224-6542
Senator Kirsten Gillibrand
Phone: (202) 224-4451
Despite the memories of 2012's Superstorm Sandy, more than 12,000 new apartments are going up in New York City's worst flood zones, according to a recent article in the New York Times. The article by Stefanos Chen, dated July 6, said that 12.4% of new apartments are under construction or planned in these high-hazard zones. This is in addition to the almost 2,400 units built in flood zones last year, which was double the 2004 level.
The article cited persistent demand for housing in these areas as the cause. The population of Hunters Point in Long Island City, Queens, increased 90% between 2010 and 2016, four years after the storm. Average sale prices have increased from $732,700 in 2012 to $1.1 million last year.
Sources quoted in the article said that flood insurance costs for these homes are soaring, with some predicted to rise from $400 to $4,000 annually, after the approval of new flood insurance rate maps.
The federal government's National Flood Insurance Program offers a maximum of $250,000 coverage on dwellings and does not insure against additional living expenses. Flood coverage from private carriers, to the extent that it is available, may provide higher limits and additional coverage.
Barring congressional action, the NFIP will expire on July 31.
The New York Compensation Insurance Rating Board today announced that the state Department of Financial Services has approved a significant decrease in Workers' Compensation loss costs. The board said that DFS had approved its filing for an overall decrease in the loss cost level of 11.7%. The new loss costs take effect on October 1, 2018.
The board also said that it will publish loss costs by classification on or before August 1, 2018.
Beginning Monday, July 16, 2018, if you are currently accessing the RLI portal, you will be receiving an e-mail message directly from RLI Insurance Company welcoming you to the new and improved portal.
You will need to click the link and register your e-mail address and create your new password.
If you are not currently accessing the RLI Portal, please contact Denise Carter at firstname.lastname@example.org or Emily Higgins at email@example.com. You may also contact either Denise or Emily at 888-431-1126 x7.
The saga of defaulted group self-insured trusts in New York appears to be nearing its end, according to the state's Workers' Compensation Board. In a report issued June 30, the board said that only a few hundred claims remain open out of an original 7,515.
Group self-insured trusts were once a popular alternative method for New York employers to finance their Workers' Compensation obligations. It was believed that employers could lower their costs by pooling their losses with those in the same industry, rather than buying insurance. However, many of the trusts became under-funded and unable to cover their losses. Most of these defaulted on their liabilities. The New York State Legislature enacted a law in 2011 that effectively scrapped the group self-insured trust system as it then existed. Only three trusts remain in operation.
The board made its report, as required by state law, to the governor and the leaders of the Assembly and Senate. The report compared the state of the defaulted trusts to their conditions on June 30, 2011, when the board made its first report. Among its findings:
- The board has issued approximately $370 million in bonds to fund the purchase of Assumption of Liability policies. State law authorized the board to issue up to $900 million in bonds. The policies capped the trusts' liabilities at specified amounts and transferred the risk of further loss development to the insurers.
- The defaulted trusts have outstanding liabilities of $34 million, down from $924 million in 2011.
- Approximately 2,900 members of defaulted trusts have signed final settlement agreements with the board.
- There are 203 open claims being administered by the board from defaulted trusts, down from 7,515 in 2011.
- Only two non-municipal trusts have open claims being administered by the board: The Empire State Transportation Workers' Compensation Trust (ESTWCT) and the Empire State Towing and Recovery Association Self-Insurance Trust (ESTRA). The ESTWCT accounts for 182 claims and $30 million of the remaining 203 claims and $34 million in open claims.
The board also said it has recovered approximately $585.5 million from members of defaulted trusts. It is pursuing damages totalling nearly $675 million from 6,000 other members who have refused to settle. It is also seeking damages from 13 trust administrators and accountants.
Despite recent moves by the federal government, short-term limited duration health plans will not be available in New York. The New York State Department of Financial Services yesterday told health insurers that state law prohibits issuing these plans.
The department's directive comes in response to a change in federal regulations proposed last winter that would permit short-term limited duration plans to be sold in the individual market for terms of up to one day less than one year. Current regulations allow the plans to have terms of less than three months. Federal law exempts these plans from certain requirements, such as the requirement for all plans to cover ten essential health benefits.
Citing several sections of New York Insurance Law and regulations, the department's circular letter states, "In New York, every individual and small group accident and health insurance policy or contract that provides hospital, surgical or medical expense coverage must be comprehensive and provide coverage for essential health benefits." The letter also pointed out that state law requires plans to be continuously renewed at the policyholder's option. Limited duration plans by definition do not have guaranteed renewability.
These requirements, the department said, "are independent of and not preempted by the requirements in federal law." The letter warned that the department will enforce these requirments "vigorously and to the fullest extent of State law to ensure that short-term limited duration plans are not offered within New York."
Each year, our board evaluates the true pain points members are experiencing now and the trends quickly approaching. We select strategic focus areas and dedicate additional resources to developing solutions and approaches to protect and equip our members.
Here are 3 wins for agents this year:
- To move the needle on the challenge most agencies have-- finding and hiring qualified team members, we developed and released the Big I NY DIY Hiring Toolkit. This kit guides you through the entire hiring process from preparing & launching your search to ultimately hiring your next great team member. A full suite of focus group tested tools includes customizable downloads to get you on track in minutes.
- Training is critical to an agency maintaining their edge and successfully onboarding new talent. And it's an area our diamond-award winning education department continues to enhance. This year our new hire online training came to the forefront, we added “from-your-desk" webinar access for the popular E&O seminars and saw a significant increase in our customized, In-House Training programs.
- To assist agents in promoting their value in this competitive landscape, we shared a series of 15 second social videos, to be used through an agent's channels. These high-quality personal and commercial lines videos allow agents the opportunity to start the conversation on varying exposures. Each video ends with 'I'm Proud to Be Your Agent."
As we move into this next year, Technology & Automation will become a major area of solution development. Our goal is to provide resources to improve workflow and customer engagement by leveraging automation technology.
While the following wasn't a predetermined focus area, it did become an area our staff focused a great deal of time and resources too...
Cyber. Cyber. Cyber. Have you heard or said that word at all this year?
Though it's been a challenge, you can be very proud of the way Big I NY supported members navigating through this newly introduced legislation. When the DFS released the new regulation that agencies must follow, your legislative team sprang into action. We fought, and had success in minimizing the burden on many agencies. We shined through the communication of steps to comply and the resources developed.
The team's service to members through phone calls and email was first rate. In fact, our support around this issue earned us several new members along the way.
We Have Your Back
Having your back and protecting your business is a role we take seriously. And how we accomplish that can take many forms - from stopping or reducing harmful regulations to participating in legislation creation, to providing important information in one easy-to-understand place.
Along with our advocacy work, we launched the GEARUP webinar series. These short webinars get you up-to-speed with the latest information on emerging and critical industry topics. Topics included Paid Family Leave, Transportation Network Companies and, of course, Cyber. Free for members and packed with useful information.
We continue our work on a variety of issues rising up that are unfriendly to agents, like the Best Interest Standard for Life & Annuity sales.
Awards presented at annual meeting
Big I New York spotlighted excellent performances over the past twelve months by insurers, a local trade group, volunteers and associates during an annual awards ceremony held today. Acting for the final time in his capacity as Big I New York chair of the board, Richard MacDonald, CPCU, ARM, AIM presented the awards at the association's 2018 Annual Business Meeting, held at the Westin Buffalo.
The Independent Insurance Agents Association of Western New York was honored as the 2018 Local Association of the Year. The award goes to the local association that has shown outstanding effort and accomplishment in local association meetings, legislative advocacy and public relations to enhance independent agents.
The Outstanding Company Partner Awards were presented to those insurers scoring the highest in their responses to a self-evaluation survey. The results were reviewed by representatives from local agent associations in New York affiliated with Big I New York. Survey questions focused on the products and services the insurers provide in areas strategic to supporting the independent agency system. MacDonald presented awards to:
- Merchants Insurance Group: 2018 Top Company Partner (more than $100 million written premium in New York)
- Security Mutual Insurance Co.: 2018 Top Carrier Partner (less than $100 million written premium in New York - upstate)
- UPC/Interboro Insurance: 2018 Top Carrier Partner (less than $100 million written premium in New York - downstate)
Monica Skibickyj, AAI, AIS, ACSR, of Lawley-Andolina-Verdi in Rochester, New York, will receive the Accredited Customer Service Representative (ACSR) of the Year Award in a ceremony at a future date. Skibickyj is an account manager at the agency.
Ashley Smit of Norton and Siegel, Inc. in Babylon was presented with the Young Agent of the Year Award for her involvement in her community, the industry, and in Big I New York's Next Generation Insurance Professionals Committee.
Lawrence Pistell, ARM of St. John's University School of Risk Management, Insurance and Actuarial Science received a Distinguished Service Award. This award goes to an individual who has made a lasting and otstanding contribution to Big I New York. MacDonald praised Pistell for the great insights he provides at board of directors' meetings and for his persistent willingness to volunteer his services to the association.
Allison Just, governance and meeting coordinator for Big I New York, also received a Distinguished Service Award. In presenting the award, MacDonald cited her incredible attention to detail, willingness to assume additional responsibilities, and general positive attitude.
Mark Garvelli of Walsh Duffield Companies, Inc. in Buffalo earned the 2018 Vincent Alba Award. This award recognizes an individual who makes an outstanding contribution to IIABNY's political effectiveness. MacDonald cited Garvelli for his contributions to the success of the organization's political action committee.
The Thom McDaniel Exemplar Award went to Rosanne Fallon, CPCU. The McDaniel Award recognizes an insurance company executive, manager or employee that demonstrates unwavering support of the independent agency system.
Mark Hagan, CPCU, ARM, retired from Perry & Carroll, Inc. in Elmira, received the 1882 Award, the association's highest honor. This award recognizes an individual who has most significantly contributed to Big I New York, the insurance industry and his community. It was the first time the association had given the award since 2016. Hagan served as Big I New York chair of the board from 2005 to 2006.
The New York Compensation Insurance Rating Board has released Manage Ownership, a web-based application for New York employers and insurance producers. It permits employers and their authorized representatives to electronically submit ERM-14 forms to the board. The ERM-14 is the board's standard form for requesting ownership information about an employer.
According to the board's announcement, Manage Ownership includes editing features, the ability to use previously saved and submitted data, and the ability to upload documentation in Microsoft Word and Excel and PDF formats.
The last chance to nominate a local charity for the Insurance Industry Charitable Foundation $2500 Local Grant is today (Friday, 4/27) at 5pm. They are awarding 10 grants across the Tri-State area. You can even have the charity do the work emailing the submission.
I know that supporting your community is very important so wanted to make sure you didn't miss the opportunity.
It's been a great week here at the Big I. From a wish granted with Make-A-Wish (Alessandra got her playset) and a touching trip to the Ronald McDonald House, giving has never felt so good.
Have a great day,