Professional Insurance Agents of North Carolina
An association run by agents, for agents
December 2021

In this issue…

• Replacing professional liability requires attention to detail
• Celebrating PIANC Members
• PIA Will Not Support Reintroduced Future Pandemic Legislation
• Want Ads 
• Thoughts for the Day
• PIANC Officers and Staff Director

Your agency could be a party in an E&O claim

by Curtis M. Pearsall, CPCU, AIAF, CPIA
President – Pearsall Associates Inc. and
Consultant to the Utica National E&O Program

Do you use third parties/vendors to help place coverage or help your clients access information? These vendors include wholesalers, MGAs, MGUs, and other independent insurance agencies. Using a third party to place stop-loss coverage is also common if the agency is involved with benefits.
Your agency could be a party in an E&O claim – and held responsible – if those entities don’t perform professionally and your client suffers harm or loss. What can you do?

• Vet these entities before placing business with them – never after.
• Develop a stated procedure addressing third parties and communicate it to your staff regularly. The most common guideline is to have specific staff members – typically senior management – approve third Ask yourself whether a new wholesaler is really needed. Do you have other wholesalers that provide the same product?Most agencies are looking to reduce the number of wholesalers they deal with, not add them. Work with wholesalers who have been vetted, providing dependable, accurate, professional service.

When using a new third party, consider the following, too

• Do the carriers meet the agency’s standard of “A-” or better according to AM Best?
• How long has the wholesaler/third party vendor been in business?
• How long have they been handling the type of business/coverage you are looking for?
• Do they have a good track record? Are they stable and likely to be around in 5 years?
• Does the third party have E&O? They ask your agency for evidence of E&O, so ask them. They can make mistakes. Are their limits of E&O liability adequate?.
• Create an agreement between your agency and the new party. Agreements can vary greatly. Have it reviewed and approved by a designated management person before any business is placed with a new entity.
• What are their binding and issuance procedures? Are these procedures documented?
• Does the wholesaler/third party meet their state of domicile’s licensing requirement?

TAKEAWAYS: Vetting the third parties your agency deals with is crucial and can cause some serious issues if not handled correctly. Reinforce this issue with your staff at least annually.

Celebrating PIANC Members

PIANC is happy to have the following new and renewing members as a part of our association.

• Coastline Insurance Associates of NC, Jonathan Peele, Leland, NC
• Angie’s Insurance Agency, Angelique Soto-Avila, Durham, NC

Thank you to the following new and renewing PIANC Sponsors.

• JM Wilson, Portage, MI

PIA Will Not Support Reintroduced Future Pandemic Legislation

by Jon Gentile, Vice President, Government Relations

Since the spring of 2020, when proposals intended to prepare for the economic consequences of a future pandemic began to emerge, PIA has been actively engaged with policymakers on this important issue.

To that end, PIA supported the 2020 Pandemic Risk Insurance Act (PRIA), introduced by Rep. Carolyn Maloney (D-NY). That bill tried to make pandemic risk insurance available the same way terrorism risk insurance was made available after the attacks of Sept. 11, 2001. The 2020 version of PRIA would have permitted insurers to voluntarily opt into a program whereby any business interruption (BI) provision offered by a participating carrier would include coverage for BI resulting from a pandemic, and, in exchange, the federal government would cover 95% of losses incurred in a covered event.

Unfortunately, the legislation reintroduced this week is substantively different from its predecessor, and PIA is unable to support it. Our main concerns include but are not limited to the expansion of the scope of the proposal to all commercial P&C lines of business that could be affected by pandemics and the mandatory offer provision.

This 2021 proposal would apply to a much broader range of losses than the original bill, which focused exclusively on pandemic BI coverage. With these changes, the bill would require coverage for BI, excess insurance, workers’ compensation, commercial general liability insurance, and directors’ and officers’ liability insurance, among others. The reintroduced bill requires all insurance carriers to offer pandemic P&C coverage, rather than permitting them to opt into the program. Voluntary participation was a key tenet of PIA’s support last year.

PIA appreciates Rep. Maloney’s efforts to continue the conversation on how best to protect businesses from the potential economic devastation of a future pandemic, but the changes in the 2021 version of PRIA are unworkable. As always, PIA will continue to work with policymakers to find common ground as this dialogue continues.

Storms in early October caused an estimated $100 million in economic and insured losses. Severe hailstorms, straight-line wind, and several tornadoes caused substantial damage in the Midwest. Severe storms in the Plains, Great Lakes, and Midwest also caused millions in economic damage and insured losses in August. These weather events caused damage to property, vehicles, vegetation, and agriculture.

Join PIANC today
and take advantage of Member Benefits such as CE class discounts!!

Jobs Board

Thoughts for the Day

PIANC Officers

Keith Hayes – President
Jake A Parrott Ins Agency
2508 North Heritage Street
Kinston, NC 28502

PO Box 3547
Kinston. NC 28502-3547
Telephone: (252) 523.1041
khayes@parrottins.com

John Cook CIC – National Director
Pinnell Insurance Agency, a division of Watkins Insurance
PO Box 18
312 S Chestnut St.
Henderson, NC 27536-4128
Telephone: (252) 438.7129
jocook@pinnellins.com

Murray M. White III – Vice President
Murray White Insurance Agency, Inc.
606 Idol Street High Point, NC 27261-2196
Telephone: (336) 889-4747
m3@murraymwhiteinc.com

Dean Wooten – Secretary/Treasurer
Wooten Insurance
PO  Box 827
Statesville, NC  28687
Telephone: (704) 838-0837
djbb@wootenins.com

Mrs. Ann Cranford CPIA, CPIW, DAE, HCSS- Director
The Cranford Agency, Inc.
PO Box 99
906 S Fayetteville St.
Asheboro, NC 27204
Telephone: (336) 629.9100
ann@cranfordagency.com

Todd McLeod – Director
McLeod Insurance Agency, LLC
1203 S Fayetteville St.
Asheboro, NC 27203
Telephone: (336) 626.6670
mcleodins@triad.rr.com

 

PIANC Staff

Kevin P. Kowar
Association Executive, CIC, AU
1059 Technology Park Drive
Glen Allen, VA 23059
Work phone: (804) 486-4218
Kevin@bianc.net
 
Sheryl Chasse
Education Director
1059 Technology Park Drive
Glen Allen, VA 23059
Work phone: (804) 486-4221
Sheryl@bianc.net

Lisa Farnham, CPIA, ACSR
Account Manager – Professional Liability
1059 Technology Park Drive
Glen Allen, VA 23059
Telephone: (804)804-486-4222
LisaF@bianc.net

Dennis Rockwell
Marketing and Membership Manager
Matthews, NC
dennis@bianc.net

Kim Bishop
IT Support and Membership Assistant
West End, NC
Telephone:( 919) 247-4045
Kim@bianc.net

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