E&O Weekly Prevention
Strategies for the Professional Agent
November 29, 2012


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Letter from the Editor

Agents of America (AOA) is excited and pleased to announce it has formed a strategic partnership with CenterPointe Solutions Inc.


In a rapidly changing economic environment, Insurance Agents and Brokers are constantly being challenged to retain as well as grow client base. CenterPointe Solutions has developed both Payroll and Human Resources Consulting Services specially designed to protect what you the Insurance Agent values the most; namely your client from outside interference of other payroll companies and other service providers promising lower cost and better services.  Since most commercial insurance buyers also purchased payroll and human resource consulting services from third party vendors, these 'payroll vendors' ultimately compete with you since they sell workers' compensation insurance as well as other insurance and employee benefit related products. CenterPointe Solutions approaches the market a little differently in that they work with the agent not in competition with the agent. Each month, one of CenterPointe experts will offer you some of their strategies and tips on how to create additional revenue as well as increase your client base. Their strategies and techniques will not only keep your competition out of your clients' offices and pocketbooks, but their services also help in retaining clients, create new clients and residual income. Check out this month Tip below, "HR Consulting Services & More".




It not too late, please join us at the DRI Professional Liability Seminar in NYC on December 6-7; learn what you need to protect your clients in 2013. "DRI's Professional Liability Seminar" 


50-State Professional Liability Compendium


This compendium summarizes significant case law and statutes concerning a wide array of professional liability insurance and claims-made coverage issues.  It is truly a comprehensive - and one-of-a-kind - publication which discusses common coverage provisions and exclusions in policies issued to a variety of professionals, directors and officers, and employers.  Insurance professionals and attorneys alike will find this compendium to be a valuable resource to consult whenever faced with professional liability or claims-made coverage issues throughout the country. Ordering information is available at DRI Store.


This week's edition of AOA E&O Prevention:



Table of Contents    


By Jackson Lewis LLP


Rules Pollution and Fungi/Bacteria Exclusions Inapplicable to Legionella Bacteria

By Thomas M. Witowski, Esq.


Legalization of Marijuana: Employers' Rights Up in Smoke?

By Scott Sweeney, Esq.


By Monica R. Dean, Esq.



Check out this week's edition of World Risk & Insurance News at WRIN.tv.


AgentsofAmerica.ORG has partnered with WebCE, a leading nationwide provider of Continuing Education for insurance professionals, to provide you with state-approved self-study CE courses to satisfy your CE requirements online! Check out your CE State Requirements.


Also available is our most recent edition of "AOA Tips, Views, News & More," including our new feature "Insurance Resources." & "Recommended Reading".  Remember that membership in AgentsofAmerica.ORG is FREE! Also if you have any thoughts, comments or suggestions, please email me at info@agentsofamerica.org


Wishing you and your families a wonderful Thanksgiving.  


"Bringing the Best Together"


Britton D. Weimer, Esq.




AOA Tips, Views, News & More


HR Consulting & More

Aaron Peterson of CenterPointe Solutions Inc.


A recent law signed by President Obama extends the federal E-Verify program until September 30, 2015.


E-Verify is an Internet-based system that compares information from an employee's Form I-9, Employment Eligibility Verification, to data from U.S. Department of Homeland Security and Social Security Administration records to confirm employment eligibility.


While participation in E-Verify is voluntary for most businesses, some companies may be required by state law or federal regulation to use E-Verify. The program is mandatory for employers with federal contracts or subcontracts that contain the Federal Acquisition Regulation E-Verify clause. There is no charge to employers to use E-Verify.


For employees it is important that you know your rights and responsibilities when you apply to work for an employer who participates in E-Verify. Employers who use E-Verify must follow E-Verify rules and responsibilities and protect the privacy of their employees.

An employer that participates in E-Verify must post the 'Notice of E-Verify Participation' and 'Right to Work' poster(s), in both English and Spanish at the company's hiring location. If the posters cannot be displayed at the hiring location they should be provided to you with your job application materials.


E-Verify does not replace the legal requirement to complete and retain an I-9 by the employer. Employers must complete Form I-9 for all newly-hired employees to verify their identity and authorization to work in the United States.


For additional information, contact Aaron at aaron@mycpsinc.com or 800-340-5856


Depression in our homes, workplaces and in our communities

By Deborah Dutton-Lambert, MBA, PC, CRC founder of Encompass Training Program    


In any given day you will likely see or hear  an advertisement for a medication to treat depression.  The prevalence of these ads is indicative of a societal problem that affects every aspect of our lives.  Depression is the number one cause of disability in developed countries and by the year 2020 depression will rank as the second leading cause of worldwide disability (Global Burden of Disease).  One commercial states that "depression hurts" and  indeed it does from the people who struggle with the illness to their families, friends, co-workers, and employers.


Depression is an often a misunderstood illness.  It is not merely sadness or a passing mood nor a character flaw or a weakness.  Depression is a major illness like many cancers or diabetes, and it is highly treatable.  The sad reality is that most people in the workplace do not seek treatment.  According to research conducted on behalf of the University of Michigan Depression Center, 65 percent of benefits managers provide employee assistance programs (EAP) for depression, but only 14 percent of employees with depression have ever accessed their company's EAP.  According to a report titled "Innerworkings" published by the AstraZeneca pharmaceutical company, employees refrain from seeking treatment due to the perceived stigma and shame that may be associated with a diagnosis and the concern that the employer or coworkers could find out.


Depression and other mental health conditions have the greatest impact on the indirect costs of a company.  The cost for untreated depression in the workplace is well documented and alarming.

  • 37% to 43% of workers with untreated depression experience short-term disability
  • 54% of employer lost productivity is due to untreated depression
  • A worker with untreated depression takes an average of 40 days off from work a year

The key word to these statistics is untreated.  Treatment works!  The impact of early intervention and treatment of depression is that it can cut an employer's indirect cost of productivity, absenteeism, and short-term disability in half.  In addition, the employer can retain their greatest assets, their employees, without the loss of valuable human capital. The challenge is to get the employee to seek early treatment, without the fear that disclosure will result in shame or stigma...and that requires a workplace that is mental health receptive.


Take a moment to think about the culture of your company.  If a co-worker or perhaps a boss is out on medical leave due to cancer, how would co-workers respond to this news.  Would the employee on leave receive cards of well wishes or even a casserole delivered to their home?  Would there be a discussion of caring and concern for the employee and the desire for a speedy recovery and return to work?  Would the employee be welcomed back with support and caring?  Now, think of an employee who is out on medical leave due to depression.  What does that feel like in your company?  If you answer, "Not the same," then you should consider a transformation to a mental health receptive workplace.  There are very simple and cost effective strategies that can be developed in order to create a mental health receptive workplace and improve the health of your employees and the financial strength of your company. For more information please visit www.encompassworkplacementalhealth.com.



Financial Tip of the Month

By Mike Brady of the Brady Financial Group, LLC


Prior to finalizing an agency acquisition/divestiture make sure there is complete understanding, by both the buyer and seller, on how receivables will be handled.  We recently came across a case in which the seller and buyer had conflicting views on this issue and it did not end well.


Don't assume the other party agrees with the "normal" approach and make sure you document how receivables will be handled. In many instances the agency being acquired is following cash basis accounting, they may not record receivables and thus record income only when the carrier pays them. Some sellers will assume that since they billed the account prior to the transaction the cash collected on these billings is theirs. Some buyers will assume since the cash came in the door after the transaction the cash is rightly theirs. Depending on the $ involved this can be an important issue and should not be overlooked. You don't want to resolve this issue after the fact!


Contact Mike at mike@bradygrp.com or Visit Brady Financial Group. Phone (484) 653-6280



Results of Last Poll Questions


Would you significantly increase your deductible to lower your premium? 


68% - No

7%   - Yes, Double it. ($2,500 to $5,000)

4%   - Yes, Triple it. ($2,500 to $7,500)

2%   - Yes, 4 Times ($2,500 to $10,000)

19%  -  It does not matter as I am not going to be involved with a lawsuit.



This Month's Poll Question


For a variety of reasons, it appears that many insurance agencies are following up with their customers to "remind" them of a pending non-pay notice.  What is the position of your agency?


a) We follow up only on specific accounts based on certain factors (size, length of client relationship with agency, etc.)

b)  We follow up on all accounts

c) We follow up on either commercial lines accounts or personal lines accounts but not both

d)  We do not follow up at all 


By Jackson Lewis LLP    


Now that we know President Barack Obama will remain in office for the next four years, what can employers expect from a second-term Obama Presidency? In 2008, the first piece of legislation President Obama signed into law was the Lilly Ledbetter Fair Pay Act. He later signed the 2010 health care reform law. President Obama and the federal agencies responsible for enforcing the nation's workplace laws likely will continue to pursue a number of pro-employee initiatives. A sampling is provided below.






















Firebrand Social Media   











By Scott Sweeney, Esq. of Wilson Elser Moskowitz Edelman & Dicker LLP


How will the much-publicized legalization of marijuana in Colorado affect an employer's right to perform drug tests and to fire an employee in possession or under the influence? For many, the passage of Amendment 64 in Colorado (and certainly its virtual twin in Washington), legalizing individual possession and use of up to one ounce of marijuana, creates images of stoned employees hiding behind a legal right to possess and consume such a psychoactive substance. After years and expense dedicated to craftily wording anti-drug policies aimed at restricting and even prohibiting such conduct, many employers are understandably asking themselves, What now?   






By Monica R. Dean, Esq. of Tressler LLP

Professional liability insurer did not receive "constructive notice" during its operative policy period of an underlying dental malpractice claim against its insured, Dr. Hamid Ahmadi, D.D.S. Physicians Insurance Company of Wisconsin Inc. v. Glenn Williams, No. 54126, Nev. Sup.; 2012 Nev. LEXIS. (June 28, 2012).  


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. Copyright 2012