INDEPENDENT AGENTS SEEK CARRIER ASSISTANCE IN KATRINA’S WAKE
Big “I” national and state associations ask company partners for innovative and flexible responses
ALEXANDRIA, Va., Sept. 22, 2005— Today the Independent Insurance Agents & Brokers of America (IIABA), and its state associations in Louisiana and Mississippi, sent a letter to independent agency insurance carriers asking for innovative, creative and flexible responses in the wake of Hurricane Katrina.
In the letter, the Big “I” state and national associations invites insurance company partners to maintain a dialogue and offer innovative assistance as their independent agents and brokers of southeast Louisiana and southern Mississippi face the daunting task of helping to rebuild their communities. In many cases, independent agencies have been completely or substantially destroyed. Agents will need assistance from the insurance companies they represent to rebuild their agencies and serve the needs of policyholders. This assistance can take many different forms. The Big “I” is urging companies to “think out of the box” and offer short term relief for their distribution force.
The letter is attached.
Founded in 1896, the Big “I” is the nation’s oldest and largest national association of independent insurance agents and brokers, representing a network of more than 300,000 agents, brokers and their employees nationally. Its members are businesses that offer customers a choice of policies from a variety of insurance companies. Independent agents and brokers offer all lines of insurance—property, casualty, life and health—as well as employee benefit plans and retirement products. Web address: www.independentagent.com.
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September 25, 2005
An Open Letter to the Insurance Industry:
Seeking Assistance for Independent Agents Devastated from Hurricane Katrina
Industry Colleagues:
Independent insurance agents in southeast Louisiana and south Mississippi face a daunting task as they play their part in rebuilding their shattered communities. They will need the help of the insurance companies, whose products they sell, to rebuild their agencies, and serve the overwhelming needs of their policyholders.
The Independent Insurance Agents & Brokers of America, Louisiana, and Mississippi recognize that there are enormous needs to be met and challenges to be overcome in order for agents and those affected so harshly by Hurricane Katrina to build a bright future. IIABA, IIABL, and IIAM would like to begin and maintain a dialogue with independent agent insurance companies, insurer trade associations, vendors, and other interested parties to facilitate the assistance critical to the personal and business recovery of all affected independent insurance agents.
Some specific issues which should be addressed include:
- Hurricane Katrina generated what many consider to be the most serious problem for independent agents—business interruption related to storm surge and flooding. Very few independent agents have business interruption insurance coverage for floods. Because of the massive scale of flooding and storm surge damage, and the widespread evacuation in some areas, payment of renewals for insurance policies will likely be somewhat chaotic for the next several months in the affected areas. We urge insurance companies to provide agents with flexibility in agency bill account current renewal payments so that agents do not get caught in an untenable position between devastated insureds and insurance companies. We also suggest that insurers consider paying some reasonable percentage of renewal commissions to agents during the emergency moratorium, so that agents are not further harmed while the renewal accounting is sorted out.
- Some agencies will have to go through expensive rebuilding efforts. We ask insurers to consider creative ways to offer qualified agencies low- interest financing.
- We ask that carriers who have office furniture not in use, or that have volume discount arrangements with furniture and equipment providers, offer affected agents the opportunity to purchase furniture and equipment through them at a reduced cost.
- In a catastrophe of this magnitude, serious coverage and claims administration issues are expected. Agents will be on the front line dealing with desperate insureds. We ask independent agent insurance companies to establish expedited claims appeals procedures which will allow agents to work effectively with all involved, in an effort to resolve disputes as quickly as possible.
- We ask vendors to be flexible in restructuring time frames for payments due on systems, software, and services in this time of unprecedented destruction, and to provide resources and business tools to affected agents at reduced rates.
We are grateful that many insurers have expressed a desire to assist their independent agent partners. In this time of need, we ask independent agent insurance companies, insurer trade groups, vendors and others to work with us to help agents so that we may focus on building a bright future. Please feel free to contact any of us to discuss how we can achieve this goal together.
Sincerely,
Bob Rusbuldt
Chief Executive Officer
Independent Insurance Agents & Brokers of America
Jeff Albright
Chief Executive Officer
Independent Insurance Agents & Brokers of Louisiana
Clinton Graham
Executive Vice President
Independent Insurance Agents of Mississippi