What has the Independent Insurance Agents of Indiana organization accomplished on your behalf?
IIAI prides itself on being one of the premier state agent associations in the country, especially in the area of legislative and regulatory advocacy.
The IIAI is the only property and casualty agent association in Indiana working in these areas.
The IIAI prefers to serve the needs of Indiana independent insurance agents where our efforts accomplish the greatest results --
and that frequently occurs outside of the limelight. But despite our desire to simply serve regardless of public recognition or reward,
we have an additional responsibility to keep IIAI members informed of the issues we face on your behalf and with your support.
While others may simply report on legislative events affecting independent insurance agents in Indiana,
IIAI lobbyists are listening to you and are actively in contact with your legislative representatives and committee members
who can shape the legislation that affects the Indiana insurance climate in which you work every day.
We can frequently be found testifying on behalf of independent insurance agents in legislative committee hearings,
or meeting with regulatory agencies and leadership to keep the needs of independent agents at the forefront of the decisionmakers' minds,
both on a regular basis as well as during crucial periods of change.
With the help and guidance of one of the most knowledgeable and active member agent bases in the United States, the IIAI has had numerous significant accomplishments in the legislative and regulatory arenas over the last several years that have greatly benefited IIAI members.
Thank you for your past and future input, involvement and feedback.
This list below is a fraction of what the IIAI has done over recent years to help its membership and independent insurance agents in general.
Further information on each topic is available on this page below the topic list.
Taking Lead in Passage of Most Comprehensive Credit Scoring Law in the Country
The IIAI was the main proponent for agents and consumers in leading the charge for the passage of one of the nation’s most comprehensive and pro-consumer credit scoring regulation laws during the 2003 Indiana General Assembly, Senate Enrolled Act 178. The IIAI’s quality relationships with the Indiana Department of Insurance and Indiana State Representatives Craig Fry (D-Mishawaka) and Mike Ripley (R-Monroe) – the Chairman and Ranking Minority Member of the House Insurance Committee, respectively – as well as other members of the General Assembly was the key to passing this landmark piece of legislation, as was the diligent work of the IIAI Grassroots Network in contacting their state legislators on the issue. SEA 178 very closely mirrors a model bill on credit scoring developed by the National Conference of Insurance Legislators and Indianais one of few states to pass this legislation in its entirety, with little variation from the model language – which is one of the reasons it is such a strong law. Major provisions of the new law include: credit scoring cannot be the sole underwriting or rating criteria used; insurers must provide a detailed explanation of the reasons for an adverse credit scoring decision to the insured at the request of the insured or agent; Choicepoint and other third parties are prohibited from selling leads generated by information obtained during the credit scoring process; and agents are held harmless from liability and are to be indemnified by insurers if they follow the policies and procedures of the insurer.
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Protecting IIAI Members from Onerous Duty to Disclose Litigation
The IIAI was successful during the first half of 2003 in helping solidify a court decision regarding an agent’s duty to disclose that could have had an enormous negative impact on the underwriting process for both agents and carriers. The IIAI, through IIAI general counsel Richard Pitts, filed two amicus curiae briefs on behalf of the defense in Pretzels vs. DeHayes – one in the Indiana Court of Appeals and one in the Indiana Supreme Court. At issue was whether DeHayes had a duty to disclose to its insured, Pretzels, a negative opinion expressed by one of its carriers that arose when the insured’s building was inspected. Had the court decision gone in favor of the plaintiff, a much higher standard of disclosure would have been created for the insurance industry, effectively undermining the underwriting process. The Court of Appeals ruled, and the Indiana Supreme Court affirmed, that the agent in this case did not have a duty to disclose the information in question – largely as a result of the two briefs filed by the IIAI. This case represents an excellent example of how the IIAI works to protect the interests of its members.
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Preserving “Existing Business Relationship” Exemption in Federal Do-Not-Fax Rule
The IIAI, in conjunction with the Independent Insurance Agents and Brokers of America, was successful in August 2003 in convincing the Federal Communications Commission (FCC) to delay the implementation date of a provision in its federal “Do-Not-Call” rule dealing with unsolicited faxes for 18 months, until January 2005. As originally drafted, the rule would have required agents and insurers to obtain preauthorization from clients to send faxes soliciting business, even if there was an existing business relationship. The IIAI and IIABA convinced the FCC to delay this extremely cumbersome and unneeded provision until January 2005 and will continue working with the FCC to make the exemption for existing business relationships permanent. note that the do-not-call rules apply only to personal and not business calls. Please also note that the Federal Do-Not-Call lists regarding both faxes and telemarketing calls apply to agents, while Indiana ’s Do-Not-Call law has a specific exemption for licensed insurance agents.
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Passage of Telephone Solicitation Law that Excludes Agents
Stopping telephone solicitors was the most high-profile issue of the 2001 Indiana General Assembly. House Enrolled Act 1222 created a “no call” list that will be implemented by the Indiana Attorney General. Indianaconsumers may call and have their names placed on this list. The law prohibits most telephone solicitors from calling individuals on the list. Two bills were introduced and then amended into a form that would have made it extremely difficult for agents to make telephone solicitations. However, because of lobbying and grassroots efforts by the IIAI, licensed insurance agents are exempt from the restrictions of this law and they may make unlimited sales calls. Had HEA 1222 passed without the amendment exempting agents, it would have been an extremely negative bill for IIAI members. In 2002, the IIAI helped preserve the law and the agent exemption in the legislature and with the Indiana Attorney General’s Office. It is important to note that this exemption for licensed agents still applies on calls made to Indianaclients, in spite of the passage of the FCC’s Do-Not-Call rules. Indiana Attorney General Steve Carter is not uploading Indiana’s do-not-call list to the federal list as several other states have done. He has informed the IIAI that because his office is the ultimate enforcement mechanism of the law, Indianawill maintain its list separately. Therefore, unless an Indianaresident registers for the federal list, agents can still call that person and the agent exemption is still valid.
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Favorable Interpretation of Privacy Rule by Indiana Department of Insurance
Privacy of personal consumer information has been one of the most significant issues that the insurance industry has had to deal with over the last several years. The federal Gramm-Leach-Bliley financial services reform law of 1999 required states to pass legislation or regulations to implement privacy guidelines that insurers and other financial service providers must follow. The National Association of Insurance Commissioners developed model language in 2000 that states were urged to adopt with regard to the use of personal financial information. The model contained several requirements that would have been extremely cumbersome and costly for agents to follow and implement. The IIAI worked with the Indiana Department of Insurance (IDOI) and urged them to adopt a less strict interpretation of the NAIC’s model. At the IIAI’s urging, the IDOI stated in the interpretation of its rule that Indiana agents would not be forced to send the annual privacy notifications required in the model (and required in other states) if they used and followed the privacy policies of the companies that they represent. This was a major achievement by the IIAI for its members, as only a handful of states have interpreted the NAIC model in this manner. This favorable interpretation saved Indiana agents countless thousands of dollars in printing, mailing and staff costs that would have been needed to fulfill this requirement.
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Passage of Legislation Allowing Agents to Charge Fees
The IIAI was instrumental in passing legislation, HEA 1222 in 2000, which allowed agents to charge fees and receive commissions on commercial lines accounts. The agent simply needs to have commercial clients agree to the fees and have them sign a consulting agreement listing the fees to be charged. The IIAI also developed and had approved by the IDOI a Consulting Agreement that may be used with all commercial lines clients.
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Development of a Privacy White Paper and Model Language & Brochures
The IIAI developed a comprehensive and easy to use guide to assist its member agencies in complying with the IDOI’s privacy rule. This guide explained the rule itself and the requirements placed on agents, outlined different scenarios that individual agencies would fall under with regard to their use of private information and provided language for internal privacy statements and client privacy notifications that could be copied verbatim if an agency chose to do so. This packet is one of the most concise and comprehensive guides that has been produced by any association in the country and is extremely simple to use and implement for IIAI members.
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Passage of Pro-Agent Producer Licensing Bill
The Gramm-Leach-Bliley law also required states to standardize their agent licensing laws in order to remove some of the barriers that made it difficult for insurers and agents to conduct business across state lines. The IAII was the only agent association working closely with the Indiana Department of Insurance to ensure that Indiana’s new law did not weaken an already strong agent and consumer agent licensing law. Without IIAI input and persuasion, this law would have been an onerous one for agents and would have given companies much more latitude in using unlicensed personnel.
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Keeping Agent Licensing Fees Low
One proposal, which was introduced as a potential amendment to the producer licensing bill, would have doubled the licensing fees that agents pay every four years. Due to IIAI lobbying pressure and the generation of a proposal that increased fees on non-resident agents, the IDOI agreed not to increase fees on resident agents and placed the fees that agents pay into the producer licensing law. This helps protect agents from license fee increases when the state experiences revenue decreases.
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Development of Issue Paper on the Use of MVRs
The IIAI developed and provided to its membership a paper outlining the issue of the use of MVRs for employment purposes in light of several MVR providers stating that they would no longer provide MVRs to agents for employment purposes. The issue paper clarified that under Indiana law, MVRs may be used for employment purposes in Indiana, in spite of the fact that many national vendors would no longer provide them for that use. The paper also clarified and gave examples of documentation that agents should provide to their insureds in the event that MVRs are used for employment purposes to keep them in compliance with the federal Fair Credit Reporting Act. IIAI provides MVRs for our members and has established a program in which member agents may obtain MRVs via the Internet from Access Indiana.
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Passage of Pro-Agent Commercial Lines Deregulation Bill
Several company trade associations brought a proposal to Indianain 1999 that sought to deregulate many commercial lines accounts. The IIAI was the only group fighting many of the changes that would have given companies almost free reign to rate and underwrite as they wished on many commercial lines accounts, with little or no IDOI oversight. The IIAI felt that only true “large accounts” should be deregulated and was successful in setting a high threshold, $75,000, for accounts that could qualify to be deregulated. In addition, the IIAI inserted language, against the wishes of several company trades, which states that an agent may serve as the agent and a consultant on the same account. In the end, the bill was a very positive one for agents that presents opportunities for large accounts, without deregulating the entire commercial lines market in Indiana.
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Keeping Pooling Out of Indiana
The IIAI has worked hard over the years to keep the market mechanism functioning within the standard marketplace in Indiana and was successful in defeating a strong push in an amendment by Indiana School Boards and the Indiana Trial Lawyers Association during the 2003 Indiana General Assembly that would have allowed pooling. The industry has been successful at keeping pooling out of Indiana , in the interest of keeping insureds in the standard market, while states surrounding Indianahave implemented pooling functions.
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IIAA is Active in Federal Issues
The Independent Insurance Agents of America has been instrumental in addressing two major federal issues over the last couple of years. The IIAA worked tirelessly to pass legislation last year that overturned the ban on installment sales tax payments that had passed in 2000. By overturning the ban, agents may spread tax payments out over several years, rather than paying them all at once when an agency or property is sold. In addition, the IIAA worked closely with the Bush administration to overturn the 2000 federal OSHA ruling that would have implemented much more strict and costly workplace safety initiatives, in addition to state workers’ compensation systems.
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Mid-America Technical Conference
The IIAI annually sends a representative from the association to represent Indianaat the annual Mid-America Technical Conference. This conference brings together states from the Midwest to speak with issues directly related to ISO policies and forms and works to address concerns and problems that states are having with the forms in practice.
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Making Self-Study Possible and Simpler for Agencies
The IIAI helped change Indiana law regarding self-study for the agent licensing exam by allowing for self-study for the exam, rather than the previous requirement that all study for the exam be classroom. This helped ease the financial burden on agencies that may now have their personnel study in-house for the licensing exam. The IIAI also has developed self-study manuals that assist those member agencies that have personnel who are preparing for the exam. These are available through the association.
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As you can see, the IIAI has been extremely successful in achieving a proactive agenda over the last several years. For more information on any of the above topics, please contact Steve Duff, CAE, IIAI Vice President of Government Affairs at (317) 824-3780, ext. 208 or e-mail email@example.com.