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Officially the Assistant Vice President of Research, Tim is our self-proclaimed "Insurance Geek."  As one of our most recognizable names and utilized resources, he helps members every day with technical questions.

IIABNY > Ask Tim
April 23
NY Insurance Agents: Deep-Rooted, Growing, Challenged


Every couple of years, the Independent Insurance Agents & Brokers of America (a/k/a, “The Big I”) conducts an “agency universe study.” The study gets into very specific detail about the state of independent insurance agencies across the country. It’s a way of taking the temperature of the distribution channel. It also indicates trends. For example, for many years the number of independent agencies shrank due to retirements, consolidations, mergers, and so forth. However, the number appears to have stabilized, according to the last few studies.

IIABNY decided it wanted to dig deep into the 2014 AUS to find out specifically what’s going on here in New York. The association hired a research consulting firm to pull out the New York data and compare it to the data from outside the state. The results were interesting – encouraging in some ways, challenging in others.

Most New York agencies saw their revenue climb from 2012 to 2013 – 67 percent. This compares to 70 percent of non-New York agencies. Like the rest of the country, New York has been slowly crawling out of the hole dug by the Great Recession. Upstate New York often seems to be in a permanent state of slow growth. Regardless, the majority of agencies are growing their businesses.

New York agencies have been around for a long time. The study looked at dates when agencies were formed. One-third of New York agencies started between 1940 and 1970. One-fifth of them were formed before 1940. That means 21 percent of New York insurance agencies are older than McDonald’s, Intel, Visa, rock music, the Peanuts comic strip, 14 Major League Baseball teams, and the last three U.S. presidents. When you consider that something like half of all businesses fail in their first five years, you have to tip your hat to that kind of staying power.

New York agencies do a big chunk of their business with New York based insurance carriers. Compared with their peers elsewhere, smaller proportions of New York agencies represent the large national carriers like The Hartford, Travelers, Progressive and Zurich. They make up the difference with New York names like NYCM, Merchants, Dryden Mutual and Utica National.

On the downside, not only are the agencies older, but so are the people running them. Almost 70 percent of agency principals are above the age of 50. That’s fine until those folks decide to hang up their spikes. Perpetuation will be an ongoing issue for New York agencies as they struggle to get people in their 20’s and 30’s into the insurance field.

On a related note, more of them report concerns about maintaining experienced producers and staff than do agencies outside the state. 40 percent find maintaining experienced producers extremely challenging (versus 21 percent in the rest of the country,) and 32 percent find maintaining experienced non-producer staff extremely challenging (15 percent elsewhere.) Industry demographics, which point to an older workforce, don’t indicate that these worries will alleviate anytime soon. Part of the reason for that may be …

They’re also not exactly training their marketing power on the younger set. Only 16 percent of New York agencies are focusing on individuals aged 39 to 49, and a slight 12 percent are going after those aged 21 to 38. Nationally, 29 percent of agencies are targeting 39 to 49 year-olds and 23 percent are targeting people in their 20’s and 30’s. Given that those are the age groups where tomorrow’s money will be, it would seem prudent for agencies to adjust their focus.

So, the report is a mixed bag, but there is no doubt that a lot of agencies have found and are finding New York a profitable place to be. I’ll be curious to see what the report two years from now will show. Will revenue keep growing, or will it plateau? What will agencies do about recruiting younger workers and selling to the electronically connected generation? The answers will say much about the insurance industry and the economy as a whole in the Empire State.

What are your thoughts on the study? Leave your two cents in the comments.

April 21
Does a Leased Vehicle = An Owned Vehicle?


Question from an IIABNY member: I have an auto policy that shows Symbol 7  ("Specifically Described Autos") for Personal Injury Protection Coverage and Symbol 5 ("Owned Autos Subject to No-Fault") for Additional PIP Coverage. The insured has vehicles that are leased. Does the word "owned," as used in Symbol 5, include leased vehicles? 

Answer: In my opinion, symbol 5 in the ISO Business Auto Policy (CA 00 01 10 13) does not apply to leased autos. I say this for the following reasons:

  • The policy describes symbol 5 as, “Only those ‘autos’ you own that are required to have no-fault benefits in the state where they are licensed or principally garaged. This includes those ‘autos’ you acquire ownership of after the policy begins provided they are required to have no-fault benefits in the state where they are licensed or principally garaged.”
  • The policy describes symbol 8 as, “Only those ‘autos’ you lease, hire, rent or borrow…”
  • The New York Mandatory Personal Injury Protection Endorsement (CA 22 32 11 13) defines “insured motor vehicle” as “a motor vehicle owned by the named insured and to which the bodily injury liability insurance of this policy applies and for which a specific premium is charged.”
  • The Additional Personal Injury Protection (New York) endorsement (CA 22 33 11 13) states, “The Company agrees with the named insured, subject to all of the provisions, exclusions and conditions of the New York Mandatory Personal Injury Protection Endorsement, not expressly modified in this endorsement as follows …”

Symbols 5 and 8 appear to be mutually exclusive – one includes only owned vehicles, the other includes only leased vehicles. The mandatory PIP endorsement includes only owned vehicles in the definition of “insured motor vehicle.” The APIP endorsement includes all the terms of the mandatory endorsement unless the APIP endorsement specifically changes them.

That is not to say, though, that the APIP endorsement does not cover anyone while they’re in a leased vehicle. The endorsement states:

"The Company will pay additional first party benefits to reimburse for extended economic loss on account of personal injuries sustained by an eligible injured person and caused by an accident arising out of the use or operation of a motor vehicle or a motorcycle during the policy period.

Subject to the exclusions set forth below, an eligible injured person is:

(a) The named insured and any relative who sustains personal injury arising out of the use or operation of any motor vehicle …
(c) Any other person who sustains personal injury arising out of the use or operation of the insured motor vehicle while occupying the insured motor vehicle; or
(d) Any other person who sustains personal injury arising out of the use or operation of any other motor vehicle (other than a public or livery conveyance) while occupying such other motor vehicle, if such other motor vehicle is being operated by the named insured or any relative."

The endorsement contains eight exclusions. Four of them pertain to vehicles owned by the injured person and that do not carry no-fault coverage; one pertains to occupying a motorcycle; one pertains to intentional self-inflicted injuries; one pertains to operating a vehicle while intoxicated; and the other pertains to racing, illegal acts, and working in the auto service business. None of these necessarily apply to the named insured or relative while in a leased vehicle, or to another person while occupying a leased vehicle operated by the named insured or relative. The endorsement should provide coverage to the injured individuals. It also gives the insurer subrogation rights, so the insurer could conceivably seek recovery from the leasing company or its insurer. 

April 17
Car Insurance Terms: No More Confusion


NOTE FROM THE INSURANCE GEEK™: Today's post is courtesy of freelance writer Gemma Daly. I invited her to write a post about the unfortunate tendency of many of us in the insurance trade to lapse into industry jargon. While this language makes sense to us, to those outside the industry, it sounds like a slightly less understandable dialect of Swahili. The audience for Gemma's post is insurance consumers, but insurance professionals would do well to keep it in mind the next time we're having a conversation with someone who doesn't live and breathe this stuff. Gemma, take it away...


Since as far back as the 1970s, in many countries across the globe, there has been a strong campaign for the use of ‘plain English’ in legal documents, government forms and contracts. The law has been shrouded in obscure and antiquated terminology for many decades. Far from being a concern for lawyers and judges in exclusivity, misunderstood terminology has led to serious economic loss for countless persons who enter into legal relationships with others, or with a company. Complicated English is discriminatory because it requires a level of comprehension which is not necessarily shared by the vast majority of English speakers in the world.

A good example of terminology which needs explanation lies in the world of insurance. Many consumers freely admit that there are some clauses and terms they simply do not understand; they may ‘get the general gist’, but they are unaware of how particular terms and clauses would affect them in concrete situations. In this post, we take a few terms from just one sector of the insurance industry (car insurance.) We will explain their meaning in plain English so that consumers can hopefully make more informed choices when renewing their policies or contracting car insurance for the first time.

  • Collision coverage: When your vehicle rolls over or collides with another object, this coverage pays for damage to your vehicle. Collision coverage may extend to a vehicle you do not own or one you are renting, and certain exclusions may apply.
  • ‘Comprehensive insurance’: In plain English, ‘comprehensive’ suggests ‘thorough’, yet if you find this term in your car insurance policy, you should know that its scope is actually far more limited. Comprehensive insurance involves all things other than damage caused by a crash. Therefore, damage caused to a third party’s vehicle, personal injury or damage to third party property, may not be covered. To make things even more confusing, a similar term, ‘all-risk coverage’, when found in a business insurance coverage, usually does cover most claims which are not specifically included by the policy. When shopping for insurance, read the small print and ask the insurer what is covered, and what is excluded.
  • Deductible: This is the amount you will be expected to pay out in the event of an accident, before the insurance company will step in to help. The higher your deductible, the lower your premium is likely to be.
  • Driver status:You can choose to add other drivers to your policy; they will be listed as having one of the following types of status:
    • Rated: They actively drive the vehicles included in the policy.
    • Excluded: They are not permitted to drive the vehicles included in the policy and will not be covered in the event of damage/injury. [NOTE: In some states, insurers cannot exclude coverage for drivers, other than possibly collision coverage. New York is one such state.]
    • Listed: Residents from the same household as the policy holder who do not drive the vehicles on the policy.
  • Full coverage: There is no such thing as ‘full’ coverage, though the appearance of the term indicates you are covered for more than just liability.
  • Personal Injury Protection (PIP) and Bodily Injury Liability Insurance (BI): These two terms sound confusingly alike, yet while BI only covers the medical expenses for any personal injury caused to someone else (not for any injury you have suffered), PIP does cover your own medical expenses and may also cover loss of wages and other damages. PIP is not available in all states yet it is obligatory in others. Some PIP plans offer loss of services (i.e. the insurance company can help you pay for grocery delivery fees, transport for your kids to school, etc.). PIP can also help your family cover funeral costs if the accident should be fatal.
  • Property damage liability coverage (PD): If you are responsible for an accident, this coverage pays for damage to the property of third parties as a result of the accident. It also generally covers legal costs you may incur if you are sued by the other party.
  • Uninsured motorist bodily injury coverage: The insurance company pays for any bodily injury you may suffer (and related medical expenses) if the responsible party (other than yourself) performs a ‘hit and run’ or is uninsured
  • Underinsured motorist bodily injury coverage: This type of coverage also covers any bodily injury you may suffer (and related medical expenses) if the person at fault does not have adequate car insurance.

Citations:, Simplifying Insurance Policies - Importance of Plain Language, accessed April, 2015., The TechInsurance Glossary of Insurance Terms & Jargon, accessed April, 2015., The Plain English Movement, accessed April, 2015.

QZ, Business Public Liability Insurance, accessed April, 2015., 5 Confusing Car Insurance Terms Explained, accessed April, 2015., Basic Things to Know when Shopping for Car Insurance, accessed April, 2015.

April 01
IIABNY, GEICO Launch NY-Only Direct-To-Consumer Sales Channel

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(April 1, 2015) — The Independent Insurance Agents & Brokers of New York today announced that it has reached an agreement in principle with insurance giant GEICO to offer customized auto insurance directly to consumers. The new program, tentatively titled the Custom Retro Automobile Program, will go online later this month. It will be the first time that IIABNY, New York’s oldest independent insurance producer trade organization, has offered insurance products directly to consumers.
“The success enjoyed by our competitors in the direct-to-consumer distribution channel has not escaped our notice,” observed IIABNY Chair of the Board James D. Sutton. “Clearly, there are opportunities in today’s marketplace. IIABNY would be remiss if it failed to pursue them.”
The program will be available on a new web site, Consumers who prefer the do-it-yourself route will be able to select a bundle of auto insurance coverages that fits their budgets. To help them make informed decisions, IIABNY Assistant Vice-President of Research Tim Dodge will produce a series of videos to be posted on the association’s Instagram page. Instagram, a popular photo-sharing Web site, allows users to post videos up to 15 seconds in length.
“How long does it take to tell someone to pick the least expensive option?” Dodge noted. “15 seconds is plenty.”
IIABNY President and CEO Richard Poppa added, “We could not be more excited about this new venture with GEICO. It is a true privilege for IIABNY to partner with one of the biggest names in the insurance industry as we enter what is admittedly an unfamiliar marketplace for us.” He neither confirmed nor denied reports that GEICO’s popular television commercial character “The Gecko” will make an appearance at the launch event, scheduled to take place prior to the New York Yankees’ opening day game at Yankee Stadium.
Concluding his remarks, Poppa added, “Did you fall for this? Happy April Fools’ Day. Oh, and … gotcha.”

February 25
NYS DMV Proposes Electronic Auto Insurance I.D. Cards


With input from IIABNY and other groups, the New York State Department of Motor Vehicles this week proposed regulations that would for the first time permit insurers to issue electronic insurance I.D. cards. The proposal appeared in the Feb. 25 issue of New York State Register.

The DMV said that it consulted with several interested groups while drafting the proposed regulations, including the state police; the New York State Association of Chiefs of Police; seven individual insurers; and the Property Casualty Insurers (PCI). PCI asked IIABNY for an assessment of potential negative impacts on insurance producers. IIABNY said that any effects on producers would be minimal, since producers do not issue permanent I.D. cards. The DMV also surveyed its peers in the 30 states that currently permit electronic I.D. cards to address concerns raised by the police chiefs.

Highlights of the proposed rules:

  • Insurance companies that choose to will be permitted to issue electronic I.D. cards. However, they will be able to do so only with the consent of the person or entity named on the card.
  • Electronic ID cards will be acceptable as proof of insurance in the same manner as paper ones
  • The cards must be capable of being displayed on a device that would earn the driver a ticket if used while in motion, such as cell phones, PDA’s, tablets, laptops, game systems, and similar devices.
  • They must meet the standards that apply to paper cards 
  • Insurers will be prohibited from issuing them for:
    • Temporary I.D. cards – agents and brokers will probably not be able to issue them
    • Self-insured entities
    • Fleet transactions, where the vehicle description on the card is “ALL OWNED VEHICLES”
    • Retail auto dealers, where the vehicle description on the card is either “DEALER GARAGE AUTO LIABILITY POLICY" or “ALL OWNED AND NON-OWNED VEHICLES-COMPHREHENSIVE AUTO LIABILITY POLICY"
    • Wholesale auto dealers and transporters, where the vehicle description on the card is "AUTO LIABILITY POLICY"

The DMV is accepting comments from the public on the proposed regulations until April 11.

February 25
Recruiting the Insurance Workforce of Tomorrow

​I read the insurance trade press every day, and if there's one story I read over and over again, it's that the U.S. insurance industry is on the verge of a cataclysmic brain drain. The workforce is getting older (I'm 53 years old, which makes me one of the younger members,) and a lot of people in the industry are seeing visions of retirement. A sizeable number of our colleagues will write their last accounts or adjust their last claims over the next several years. By most accounts, we are nowhere near ready for this.

That's why the work described in this three-minute report from a TV news show in upstate New York is so important. Many of you are probably familiar with the name "InVest," but you may not know how it works or how well it works. This is a good example of outstanding work done by one CEO of a small mutual insurer and some high school teachers.

Watch, and think about what you can do to make sure knowledgeable insurance professionals will be there to handle your claims ten years from now.



February 20
Do Agents Have To Encrypt Emails Containing Customer Information?


Text of an email recently sent to an IIABNY member:

​I was asked to respond to your inquiry. As I understand it, you want to know whether your agency is required by law or regulation to encrypt certain customer information, such as when you prepare and email auto insurance I.D. cards. I apologize for the length of this response, but my conclusion is that the law and regulations do require an agency to encrypt such communications.

Certain sections of the federal Gramm-Leach-Bliley Act imposed requirements for the protection of customer information on insurance licensees. This law directed state insurance departments to implement and enforce the requirements. In New York, the Department of Financial Services enforces them by way of Insurance Regulations 169 and 173 (both are available for download from the Privacy page in the Member Answer Center of our Web site.) Regulation 169 pertains to privacy of consumer financial and health information; Regulation 173 pertains to standards for safeguarding that information. It is Regulation 173 that directly addresses your question.

The core requirement of Regulation 173 states simply:

“Each licensee shall implement a comprehensive written information security program that includes administrative, technical and physical safeguards for the protection of customer information. The administrative, technical, and physical safeguards included in the information security program shall be appropriate to the size and complexity of the licensee and the nature and scope of its activities.”

I think this paragraph can be found in the dictionary as an example of the word “vague”. It does include some defined terms, however. A customer is someone who is seeking, or obtains, or has obtained in the past personal lines insurance from a carrier or agency that has “nonpublic personal information” about him, if he has a continuing relationship with that carrier or agency. If I bought insurance from you last year and still have that insurance through you, and you have information on me that people cannot find in a public database, then I am your customer within the regulation’s meaning.

The term “nonpublic personal information” includes “nonpublic personal financial information” and “nonpublic personal health information.” I’ll focus on the financial side here. The term “nonpublic personal financial information” includes:

  • Any information: 1) a consumer provides to the carrier or agency to obtain an insurance product or service from it; 2) about a consumer resulting from the insurance transaction; or 3) that the carrier/agent otherwise obtains about him in connection with providing an insurance product or service to him.
  • Any list, description or other grouping of consumers (and publicly available information pertaining to them) that is derived using any personally identifiable financial information other than publicly available information.

It does not include health information; publicly available information (other than that included in the list described above); or any list, description or other grouping of consumers (and publicly available information pertaining to them) that is created using only publicly available information.

For example, a list of cars that a consumer owns is “nonpublic personal information” because that falls under the first bullet point. A list of consumers who have registered cars with model years 2013 and later is also “nonpublic personal information” because it is compiled using information not publicly available. A list of all households on a particular street is not nonpublic personal information because street addresses are easily available from public sources.

In my opinion, an auto insurance I.D. card is a document that contains nonpublic personal financial information because it contains the name of my insurance company; my policy number; and the year, make, model and VIN of my car. None of these pieces of information are available from public sources. By law, the DMV would provide this information only to a person who has a use for it permitted by that law.

So, if I am your customer and you have nonpublic personal information about me, then Regulation 173 requires you to safeguard it. The regulation requires you to implement an information security program designed to accomplish three things:

  • Ensure the security and confidentiality of customer information
  • Protect against any anticipated threats or hazards to the security or integrity of such information; and
  • Protect against unauthorized access to or use of such information that could result in substantial harm or inconvenience to any customer.

Encrypting an email that contains my auto insurance I.D. card would appear to fall within all three of these requirements. It is designed to keep my information confidential, to protect against the omnipresent threat from hackers, and to keep it from being stolen. Theft of the information about my cars could cause me harm, as someone could conceivably borrow money in my name and list my cars on the loan application as assets. Conversely, failure to protect emailed communications could be construed as failure to implement the information security program because the three objectives are not met.

The Agents Council for Technology Web site has a wealth of information about ways to accomplish the regulation’s objectives, including information about TLS encryption technology. You may find some of that information helpful.

To summarize, I believe the Gramm-Leach-Bliley Act and the regulations that implement it require insurance agents and brokers to encrypt email messages that contain  customers’ nonpublic personal financial information. This would include auto insurance I.D. cards and other documents that contain information not readily available to the public.

February 04
Slideshow Tutorial on NARAB II

When Congress and the president extended the Terrorism Risk Insurance Act last month, they also enacted the National Association of Registered Agents and Brokers Reform Act. This law will make multistate licensing far easier for insurance producers all over the country. The slideshow shown below is a quick overview of what NARAB is and what it means. The slideshow will be permanently available on the Licensing page of the IIABNY Member Answer Center and the CE & Licensing Help page in the Education section of the IIABNY Web site.



December 10
Check Out Cavalcade of Risk #223

It's online today at, it's all in rhyme, and it features my post calling on agents to stop issuing certificates of insurance. 'Tis the season of hope, you know.

December 01
Forget Driverless Cars. Are You Ready For Flying Cars?


This from Bloomberg News, as reprinted in Insurance Journal:


The first time Carl Dietrich brought his flying-car concept to the Experimental Aircraft Association’s annual AirVenture gathering in Oshkosh, Wisconsin, he had only a video to show the aviation geeks who wandered by his modest stall. The following year, he brought the mock-up of a wing. Six years later, in July 2013, he was finally ready to fly the prototype.

As the announcer who introduced the Terrafugia Transition put it: “Ladies and gentlemen, this is one of the most incredible things we’ve seen, ever, here at Oshkosh. Twenty-five minutes ago, this was a street-legal automobile. Now, it’s in the air.”

Pilot Phil Mateer buzzed the crowd while the announcer patched into his cockpit microphone to ask him how it felt up there. “I’m in a car looking down on traffic,” Mateer replied. “And it flies real nice.”


More than a hundred people have paid deposits of $10,000 each for the Transition, which will be capable of 70 miles (110 kilometers) per hour on the road and 100 mph in the sky when it finally comes to market sometime within the next three years. Dietrich is refining details on the third-generation prototype of his $279,000 vehicle before attempting certification by both the FAA, which regulates planes, and the National Highway Traffic Safety Administration, which oversees cars.


Critics say flying cars are unlikely to be both great airplanes and great automobiles. But that misses the point, says Dietrich, who explains the Transition is intended to expand the definition of an airplane, solving a number of persistent problems in the process.

First and foremost is that small planes are virtually useless in inclement weather. If a storm rolls in while you’re flying the Transition, on the other hand, you can simply land at many of the 5,000-plus airports in the U.S. alone, push a button to fold up the wings and hit the road until conditions improve. At home, you can park it on the street or in the typical suburban garage. And it runs on regular unleaded gas, which is cheaper and cleaner than aviation fuel and available at your local service station.

“You’re getting comparable gas mileage to your road car, but you’re going 100 miles per hour over all the traffic,” Dietrich says.

That makes the Transition ideal for weekend jaunts or for salespeople and others whose jobs require regular trips of a few hundred miles — although, at the expected price, even he admits it won’t be within reach of your average salesperson anytime soon.

For insurance purposes, is it an automobile or an aircraft? Which insurance policy is appropriate? Will someone have to create a whole new insurance product? And who will offer it? How will carriers underwrite it?

Say what you want about the times we live in, but boring they are not.

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