E&O Prevention
Strategies for the Professional Agent
AOA Newsletter Banner
October 27, 2011


Compliments of www.AgentsofAmerica.org

Marketing Trends and Updates

Agents of America

Find us on Facebook
   View our profile on LinkedIn   Follow us on Twitter


 Meet the Authors


Of our Brand New Ebook



"Insurance Agents & Brokers Risk Management Program"






AOA Preferred Partners
AoA Advertisers
Swett Static Ad




Insurance Leads Logo
MTWFY Banner Ad 

Geologix Ad 
Visit AgentsofAmerica.org for more information.

284C E. Lake Mead Parkway
Henderson, NV 89015
What is AgentsofAmerica.org?
AgentsofAmerica.ORG is an Insurance Agent's Association and indispensable resource for news, products, services, education, and industry information throughout America. The organization's Mission is to deliver the BEST people, products, information, and services to Agents on a daily basis all designed to help them manage and grow their business, increase their revenues and provide ongoing value to their clients. Our motto is "Bringing the BEST Together."

AgentsofAmerica.ORG is offering a FREE MEMBERSHIP to anyone interested in learning about the valuable benefits the new organization offers. All members are eligible for additional discounts and access to an extensive array of other membership programs.
Printing Tips

If you would like to print an article from this newsletter follow these steps:

  • Click the "Read More ..." link of the corresponding article.  
  • That will get you to the article page.  
  • At the end of the article click "print this page" button to print the article. 


AOA All Chapters

Letter from the Editor

I am happy to announce that thirteen chapters of our new up-and-coming Risk Management eBook, "E&O Loss Control & Risk Management Program for Insurance Agents and Broker," have been completed. We expect the book to be completed by the end of the year, and be available for distribution by the end of the first quarter of 2012. Check out our updated "MEET THE AUTHORS" to our new EBook for more details.  The Book, once completed, will have 26 distinct chapters, plus an Appendix on Best Practices, that will represent a collaborative effort of 25 of the top E&O insurance attorneys and experts from across the country.


AgentsofAmerica.org Forms Two New Strategic Alliances:  


"Bringing the Best Together" - Agents of America is pleased to announce its newly formed a strategic partnership with Mike Brady of  Brady Financial Group in Exton, Pa., a leading provider of outsourced financial resources to help business owners identify and solve their financial and business challenges. Mike Brady has more than  His 20 years in the industry as both CFO of a top 50 regional broker and partner in Brady Financial Group provides him a unique perspective to the agent/broker industry. The firm provides part-time or interim CFO services as well as engages on specific projects where management requires additional financial expertise.


One of Mike's objectives will be to provide agency owners with insight into the key financial and operational areas that should be considered when building a successful insurance agency.  Topics to include:


Agency Valuations

Mergers & Acquisitions   

Strategic Agency Planning                   

Financial Metrics


See Mike's article below on "How Much is You're Agency Worth." 


As we announce in August, we have another new resource for our readers. Each month, we will feature a brand new Social Media EBook that contains valuable information on how you can harness the power of social media. Each featured EBook will contain a wealth of information that will include such topics as Facebook, LinkedIn, Twitter, Email and Blogging to name a few. This month's EBook is entitled "Google's New Local Search SERP", we know you'll find this information valuable for your business. Please feel free to email us to share "Google's New Local Search" we know you'll find this information valuable for your business. Please feel free to email us to share your comments. In addition, we are happy to consider suggestions or topics you'd like us to put into an EBook.


We also recently formed a strategic partnership with ParasolLeads Partners. ParasolLeads is committed to making the task of finding profitable insurance leads less of a hassle for agents. By utilizing unique lead generation methods, the company can provide 100% organic leads that result in a high return on investment. The company helps agent clients to achieve significant ROI while creating the high client satisfaction that earned them an A+ Accredited Business Rating with the Better Business Bureau.


This month's poll question: 


Do you review the AM Best size rating of your errors and omission carrier (i.e. A+/XV , A/X):

  • Yes
  • No


Again, we want to thank everyone for their support.  Remember to tell your friends and business associates that AgentsofAmerica.ORG is now offering FREE MEMBERSHIP


Also, available for our readers, AgentsofAmerica.ORG is now offering a new service to all of our subscribers and readers to market their products, services or upcoming events, MARKET SOLUTIONS. This unique opportunity will allow you to reach thousands of Insurance Agents, Brokers and Insurance Professionals across the country in timely, efficient and cost effective manner. In addition to sending out your message, we can also help you use Internet Marketing as medium to convey your announcement, as well as on how it can be utilized to effectively grow your business. If you have any question, please send your inquiries to: info@agentsofamerica.org.


"Bringing the Best Together"

Brit Weimer, Esq.



Table of Contents
By William Krauss. Esq. & Guy Levasseur, Esq.

Table of Contents


profProfessional Liability Insurance Coverage Update

By Thomas D. Jensen, Esq.


Coverage lawyers tend to think in terms of "occurrence", "bodily injury", "property damage", "all sums", "allocation by time on the risk" and other constantly litigated terms. That is the focus of commercial general liability ("CGL") insurance that was created to protect policyholders from bodily injury or property damage claims asserted by third parties. But occupying some space there in the declaratory judgment corner is another type of coverage that has little to do with CGL-style litigation. It is professional liability coverage, errors and omissions coverage, "D&O" coverage, and similar descriptors that insures a different risk. It insures professionals for errors or omissions in judgment that cause loss.   We explore here a description of the coverage, common exclusions, and survey the litigation landscape when coverage is denied in professional policyholder contexts. 




eoE&O Loss Prevention Tip

By Brown & Brown of California, Inc.


Description of Claim:

Allegations against the agent:


Client of insured agent came to office in need of coverage to satisfy the state's insurance requirement. The client would only qualify for the assigned risk plan. The agent has no binding authority. The client asked for an insurance card so he could show to the department of motor vehicles. The card reflected that coverage would take effect that same date. The agent had the client complete the application and pay the requisite premium. The agent placed the application and the premium on his desk to be sent the following day. Due to illness, the application and payment did not get routed until 2 days later. In the interim, the client was involved in an auto accident. There was no coverage in place on the date of loss but the client produced the insurance card verifying that the coverage was in force.




howmuchHow Much Is Your Agency Worth?

By Mike Brady



Every agency owner has asked this question.

Can you answer it based on today's buyers?


Many insurance agency owners have long relied on an old formula for determining the value of their business. "I don't need a valuation," one owner told me, "I know how it works. Everyone gets a multiple between one and two times revenue." Interestingly, the following year that owner was surprised when a prospective buyer started looking at his company and things got more complicated. 





howHow to Destroy Your Reputation in 7 Easy Steps

By Charles T. Wilson, CMC, CRM, RPLU


'Reputational Risk' is often in the news, and we've seen many role models to show how to handle - or not - a business crisis. Arrogance, greed, secrecy and easy shortcuts seem to characterize financial institutions and coal mines, Toyota, BP, BART, and now PG&E. We are witnessing some terrific learning moments for risk management.







jobJob Applicants Who have Personality Problems: Pre-Employement Tests Help You Avoid Hiring Such Troublemakers  

By Michael Mercer, Ph.D.


Imagine your horror as you observe an employee making trouble in your company. Imagine how this troublemaking employee with personality problems . . . 




closeClose Too Quick and You Lose Profit

By Mark Hunter


It's always rewarding to close a sale and immediately have the new client sign the documents to secure the sale.  No matter how many years in the business, this always feels good.





newNew York Court of Appeals Rebuffs Homeowner Insurer's Efforts to Avoid Wrongful Death Coverage

By William Krauss Esq. & Guy Levasseur, Esq. 


The New York Court of Appeals rebuffed a homeowner's insurer's efforts to avoid coverage by finding the term "benefit" as used in an exclusion barring bodily injury coverage where an insured received benefits under the policy did not include the insured's right to defense and indemnification coverage in a wrongful death suit.


Read More... 



Swett Static Ad



irsIRS Provides Payroll Tax Relief for Employers Who Reclassify Their Workers 

By Yale Pollack, Esq. 


On September 21, 2011, the Internal Revenue Service ("IRS") launched a program designed to allow employers to resolve worker misclassification issues and make only a small payment to cover past payroll taxes. The Voluntary Classification Settlement Program (the "VCSP") is aimed to: (a) increase tax compliance; and (b) reduce the burden on employers by providing greater certainty for employers, workers and the government.  




califCalifornia Rules for Hirer of Independent Contractor in Contractor's Employee's Suit Based on Claimed Safety Violation by Hirer

By Mark S. Askanas, Esq. 


When an employer in California hires an independent contractor, what duty, if any, does the hirer owe to the contractor's employee injured on the job?  Generally, when employees of independent contractors are injured in the workplace, their remedy is limited to workers' compensation.  They cannot sue the contractor or the party that hired the contractor.  This applies even where the on-the-job injury is allegedly caused by the hirer's failure to comply with workplace safety requirements concerning the precise subject matter of the contract between the hirer and the independent contractor, the California Supreme Court has ruled, giving Golden State employers a small victory.  Seabright Ins. v. US Airways, No. S182508 (Aug. 22, 2011).  By hiring the independent contractor, the Court explained, the hirer implicitly delegates to the contractor any tort law duty it owes to the contractor's employees to ensure the safety of the specific workplace that is the subject of the contract.




claimsClaims Against China-Based Reverse Merger Companies: A Tempest in a Teapot of Gunpowder or Green Tea?

By Anjali C. Das, Partner, Wilson Elser




These days, nearly everything to do with China has grabbed the spotlight - not least of all the country's extraordinary and seemingly unstoppable economic growth. Not surprisingly, many U.S. investors have been pouring millions of dollars into Chinese companies with the hopes of gaining super-sized returns. However, naysayers have long predicted a bursting of the China bubble. At least for investors in China-based issuers, perhaps that time is now. Not unlike the bursting of the Internet bubble in the 1990s fueled by explosive growth and investment in "dot.com" companies, investors and regulators may now have reason to fear the rapid rise and fall of Chinese companies that have accessed U.S. capital markets through reverse mergers. While short-sellers are publicly denouncing the purported fraud at these companies (and making big bucks shorting the stock), U.S. regulators are investigating the rash of accounting scandals at these companies, which have caused some auditors to abruptly resign. Meanwhile, directors and officers (D&O) insurers have to contend with the collateral damage resulting from the multitude of claims against China-based issuers and their directors and officers.


Read More....




By Ed Rosa


These are rough times for some people. For others, you might be doing well but are keeping your options open in hopes of finding that "Dream Job". In either case, there are a few things you should keep in mind when hitting the streets to find your next position. Here are a few tips that have proven to be helpful and have become increasingly important during these challenging times:



Motivational Quotes/Joke of the Month

"People don't know what they want until they see it."

- Steve Jobs


"You can have excuses or you can have results."

- Fabienne Fredrickson


"You can get all you want in life if you help enough other people get what they want."

- Zig Ziglar


"Go ahead:  Give yourself a hug today."

- Lady Gaga



"I was diagnosed with anti-social behavior disorder, so I joined a support group.  We never meet."

- Craig Sharf, comedian



The Motivational Quotes and Joke-of-the-Month are provided for AgentsofAmerica.ORG members by Michael Mercer, Ph.D., www.Pre-EmploymentTests.com

. HIRE THE BEST - & AVOID THE REST™, Mercer Systems, Inc.; Michael Mercer, Ph.D., Book Author & Management Psychologist, President. Phone = 847-382-0690; Website = www.Pre-EmploymentTests.com.


This newsletter is produced in conjunction with Agents of America, www.agentsofamerica.org. The contents of which may not be reproduced without the express written permission of Agents of America.