October 2006 National Association of Professional Insurance Agents

Insurance On-line Network WebEx Series page 16

From the President

2 May 2006www.pianet.com

In the months to come when I write you these letters,I’ll be talking about the different issues and challengesthat professional insurance agents are facing, and what

we all must do together to prevail and win.But first things first. Many of you look at me as the

first female president of PIA National, which in fact I am.But I am far from the first woman in this association tolead.

Many women over the years have given so much to PIA — members of the Boardpresent and past, affiliate executives, presidents of our state associations and nation-al staff. PIA has always respected the talent and integrity of women in insurance andafforded us the opportunity to lead for many years. I appreciate the respect PIA hasshown for the service of women in insurance, and I appreciate the leadership of allthe women who have served in PIA across the United States. I’m proud to be oneamong them, as I begin my year as your president.

Many of you may know that the PIA National you see today has changed fromthe one of just a few years ago. For a number of years, things were tough. But thanksto the dedication of the many who never lost faith and never stopped believing, weare now well into the dawn of PIA National’s bright new day.

When we all work together, there’s nothing we cannot accomplish. My mantrafor PIA is “all for one, one for all.” Remember, although you may not be in a leader-ship position in your association at this time, you are, as our rank-and-file member,most assuredly, the lifeblood of our association. Your participation is important tous. You honor us with your membership — now honor us with your talents! Sharingour collective knowledge, talent and expertise throughout PIA, we can achieve anygoal we set for ourselves. We just need to reach out and bring in that talent. If youare reading this and have something to offer your association that we have not rec-ognized, please step forward now and lend us your help. Always remember, it is yourPIA National.

If, during my year as president, we continue to raise the profile of professionalinsurance agents across the country and the role we play in this great industry weserve, we will have accomplished another part of our Mission Statement. If we con-tinue to protect and defend the integrity of PIA members and advance their businessinterests, we will have kept our Mission Statement at the forefront of our goals.Then, we will all be able to look back with a measure of success. That successrequires all of our efforts, working together.

My philosophy is guided by some words of inspiration from the 26th President ofthe United States, Theodore Roosevelt:

“It is not the critic who counts: not the man who points out how thestrong man stumbles or where the doer of deeds could have done better.The credit belongs to the man who is actually in the arena, whose face ismarred by dust and sweat and blood, who strives valiantly, who errs andcomes up short again and again...but who knows the great enthusiasms,the great devotions, who spends himself for a worthy cause; who, at thebest, knows, in the end, the triumph of high achievement, and who, atthe worst, if he fails, at least he fails while daring greatly, so that his placeshall never be with those cold and timid souls who knew neither victorynor defeat.”

Now, let’s get to work and have a great year for PIA and Main Street professionalinsurance agents!

Donna L. PilePresident

PresidentDonna L. Pile, CIC, CPIW (KY)donnapi@pianet.org

President-ElectRobert P. Page (LA)cpageinsurance@aol.com

Vice President/TreasurerKenneth Auerbach, Esq. (NJ)kauerbach@e-kinsurance.com

Secretary/Assistant TreasurerJon D. Spalding (MI)jdspalding@spaldinginsurance.com

Immediate Past PresidentRay L. Peretti, CIC, FMS (WA/AK)hubinsagy@aol.com

Executive Vice PresidentLen Brevik (PIA National)lenbr@pianet.org

PIA National Image Committee ChairmanWayne Wehr (HI)waynew@servco.com

Publisher/Editor-in-ChiefTed Besesparistedbe@pianet.org

Managing Editor/AdvertisingAlexi Papandonalexipa@pianet.org

Government/Regulatory AffairsExecutive EditorPatricia A. Borowski, CPIW, CAEpatbo@pianet.org

Contributing EditorsKellie BrayKristi DeilyDavid Eppstein

Production EditorLaurel Prucha Moranlaurel@blueroomstudio.com

PIA Connection is published ten timesyearly by the National Association ofProfessional Insurance Agents.400 North Washington Street,Alexandria, Virginia 22314©2006 All rights reserved.

The information in this publication is gen-eral in nature and is not intended to serveas legal, accounting, financial, insurance,investment advisory or other professionaladvice as to any reader’s particular situa-tion. Users are encouraged to consultwith competent legal, financial, insurance,investment advisory and or other profes-sional advisors concerning specific mat-ters before making any decisions and wedisclaim any responsibility for any deci-sions or actions by readers.

All PIA members receive PIA Connec-tion at the member subscription rate of$12.00 per year.Non-member subscriptions availableat $24.00 per year ppd. For additional information on any of thesubjects addressed in this publication,please access the PIA National websiteat www.pianet.com

By Leonard C. BrevikExecutive Vice President & CEOPIA National

Imagine for a moment a state legislatorintroducing a bill that made it illegalfor businesses to pay year-end bonuses

to their sales forces.Then imagine that this piece of legisla-

tion also made it mandatory that all busi-nesses provide written notices to theircustomers disclosing the portion of thecost of each individual product that goesto compensating that firm’s sales force,specifying a percentage or dollar amountfor each individual item or transaction,and requiring that a written notice beprovided to and signed by the consumerbefore any sale can be completed.

And then imagine that this legislationalso included a provision requiring allbusinesses to lobby for laws and regula-tions making the payment of year-endbonuses illegal.

Clearly such a bill, were it ever to beintroduced in any state legislature, wouldbe instantly dead on arrival, and withgood reason. No lawmaker in his or herright mind would ever seriously proposesuch an attack on how the American freeenterprise system operates.

Unfortunately, that’s what we are nowseeing — not in the form of legislation,but rather in proposed agreements to set-tle pending litigation.

The PIA AmicusOn September 15, 2006, the National

Association of Professional InsuranceAgents (PIA National) filed an amicus,or friend-of-the-court brief, in the U.S.District Court for New Jersey. PIA isrequesting a delay in preliminaryapproval of a class settlement withZurich Insurers until flaws in a mandato-ry disclosure statement are corrected.Our filing also raises other serious ques-tions regarding restrictions on some con-tingent commissions.

PIA did not take this step lightly.Unfortunately, we had no other option.

Starting in late 2004, several stateAttorneys General announced that theyhad uncovered instances of alleged bid-rigging in dealings involving a handful oftop-of-the-marketplace Mega Brokers ininsurance. Proposed settlements in result-ing civil actions seek to ban the paymentby carriers of certain contingency pay-ments, as well as require the use of disclo-sure notices that PIA believes are defec-tive, confusing to consumers and possiblyillegal.

PIA tried to participate in the draftingof the Mandatory Disclosure Statementin this case, but was unfairly locked outof those negotiations. The settlement wascrafted in secret. Unfortunately, the carri-ers involved in this process are in no posi-tion to make modifications to theseimposed results.

Broader IssuesBeyond our immediate concern about

the flawed disclosure document in thiscase, there are broader issues involvedhere. PIA objects to this and similar pro-posed settlements because they wouldcreate disparate impact on PIA members’livelihoods by prohibiting the paymentby carriers of certain contingency pay-ments. In the case of the proposed settle-ment involving Zurich, another provisionrequires the company to “support legisla-tion and regulations in the United Statesto abolish Contingent Compensation forinsurance products or lines.”

This provision raises serious FirstAmendment questions. Officials shouldnot be using their authority to functionas lobbyists in a manner that usurps thepolicymaking role of state legislators. Nobusiness should ever be forced by the gov-ernment to advocate for a particular pieceof legislation, just as no individual shouldever be required by the government tosupport one political candidate overanother. Such action is a perversion ofdemocracy itself.

PIA is very concerned that if leftunchallenged, prohibitions on compensa-tion could be applied to other sectors of

our economy, adversely affecting a widerange of small and mid-sized businesses.

Punish theWrongdoers,Not Main Street Agents

Regrettably, these settlement agree-ments have attempted to paint all pro-ducers and carriers with an assumptionthat everyone in the insurance industrywho receives performance-based com-pensation is violating the law.

Commissions, contingent or not, are amainstay of our economy. In our indus-try, they also support critical, professionalfront line underwriting by agents toassure the financial health and solvency ofinsurers that we all rely on. Rather thanattempting to bring about the elimina-tion of incentive compensation as ameans of discouraging abuses of the sys-tem, state Attorneys General should con-centrate on policing such abuses.

PIA condemns illegal actions such asbid-rigging whenever and wherever theyoccur. Those who violate the law must bepunished. But if fairness is the goal, as itshould be, then those who have not vio-lated the law should not be punished.

Main Street insurance agents did notcommit the alleged abuses that led tothese proposed settlements. But these set-tlement agreements attempt to imposeill-advised remedies for wrongdoing onMain Street agents, who did nothingwrong. That’s just not right.

Leonard C. Brevik lenbr@pianet.org is Exec-utive Vice President & CEO of PIA National.This article appeared in the October 23,2006 issue of Insurance Journal.

Perspective

PIA’s Court Filing on Disclosure,Contingent Commissions

October 2006 3www.pianet.com

Thank You for the

Recognition.We are honored to be this year’s recipient of the 2006 National CompanyAward of Excellence.

As we celebrate this accomplishment,we realize it is to be shared with the “main street agencies” that havecommitted themselves to excellence and contributed to our success. We willcontinue to support the independentagency system and provide the necessarytools to allow independent agents toremain competitive in the marketplace.

We would also like to thank PIA for its manyyears of service. Contratulations on your 75th!

By David M. EppsteinDirector, State AffairsPIA National

I n early March 2006, 12 state Attor-neys General and departments ofinsurance announced the first set in a

series of multi-state settlements involvingalleged insurer actions connected to the2004 broker compensation and competi-tive practice actions.

NAIC Announces Bid-Rigging Settlement

On March 20, 2006, the NAIC issueda press release touting their Broker Activi-ties Task Force’s participation in a multi-state regulatory settlement with Zurich.According to the release, the settlementcontains monetary relief, corrective meas-ures and business reforms based onZurich’s alleged participation with variousinsurance brokers to create a false appear-ance of market competition “in violationof state insurance laws.” The press releaseitself states that current state insurancelaws were sufficient to address the allegedillegal behavior, yet it goes on to claim thissettlement is an “excellent example of stateinsurance regulators’ collaborative leader-ship on an important regulatory issue.”

We cannot help but wonder why allthis hysteria and market reform was nec-essary given that every insurance jurisdic-tion has laws prohibiting fraud and mis-representations in insurance transactions,and these laws adequately address the con-cerns revealed in this latest investigation.

Settlement ExceedsNAIC ModelAmendment

We at PIA were taken aback by theNAIC press release because, first of all,the negotiations were obviously happen-ing secretly, behind closed doors.

We had heard about the possibility offurther settlement negotiating activities

conducted by the NAIC Special BrokerDisclosure Task Force, but our repeatedefforts to ask what, where, who TaskForce members were and the like wererebuffed by the NAIC. Second, we weresurprised and alarmed to see that the out-come of the settlement process lead to a“solution” that went far beyond what theNAIC failed to produce through an opendeliberative process on their proposedbroker disclosure amendment to the Pro-ducer Licensing Model Act.

So, in the wake of these events, PIAstill has no clarifying answer from theNAIC to the question: what is theNAIC’s position on broker disclosure andhow is the Special NAIC Task Forcearriving at its policy decisions on thisissue? Clearly, it is not in the best interestof the states or consumers for the NAICor several state DOIs to use this settle-ment process and mandates as the defacto vehicle to achieve presumed con-sumer protections that the insurancedepartments have not otherwise beenable to implement through their formalregulation and/or legislation.

State RegulatorsTaking a Second Lookat Settlement

Once PIA learned of the settlementresults we sprang into action. The firsttime the NAIC Broker Activities TaskForce held an open meeting was at thesummer meeting in Washington D.C.and PIA was there. PIA’s Senior VicePresident, Pat Borowski, engaged in ameaningful discussion with Task ForceChairman, Director Michael McRaithfrom Illinois.

We were able to dispel any notion thatPIA has a blanket opposition to disclo-sure under any circumstances. We madeclear PIA’s longstanding policy for pro-ducer disclosure and consumer agree-ment when the insurance producer isreceiving compensation from both sidesof a single insurance transaction, evi-

denced by our PIA affiliates’ efforts inachieving such requirements in some 30states. The settlement result, however, is ablanket attack on contingent commis-sions and includes a specific mandatorydisclosure form for insurance producersthat is misleading and illegal.

The attack on contingent commis-sions is particularly troubling, but wewere encouraged somewhat at the TaskForce meeting when the NAIC membersin response to PIA’s direct questions onthis point acknowledged and confirmedthat the NAIC does not support a per seprohibition of contingency compensa-tion earnings from the marketplace.

Fortunately, state regulators are begin-ning to see our point of view. Just recent-ly, Georgia Commissioner John W.Oxendine said that he would not sign onto the settlement agreement stating itserves “no worthwhile purpose.” Webelieve that through our diligent efforts,many other regulators will come to thesame conclusion.

PIA condemns any illegal behaviorand we applaud tough sanctions for thosefound to violate the well-established lawsand regulations currently on the books toprotect consumers. We must vigorouslyoppose efforts by some law enforcementofficials seeking notoriety in the press onthe backs of innocent, hard workingindependent insurance agents by attack-ing contingent commissions and impos-ing an unworkable remedy to a problemthat already has a solution.

PIA supports state laws as the primarysource for ensuring proper disclosure andinvestigating any fraudulent activities.The primary reason we support thisapproach is because IT WORKS! Weregularly work with states to clearlydefine what practices will be prohibited,permitted and the procedures our mem-

Perspective

PIA Working With NAIC toAmend Insurer Bid-Rigging Settlement

October 2006 5www.pianet.com

Continued on page 18

National2006

Managing GeneralAgency of the YearMacNeill Group, Inc.

MacNeill Group is honoredto be named

PIA National’s 2006‘Managing General Agency

of the Year’

Many thanks to the PIA for acknowledging us with this awardand for providing agents your support and services for the past75 years.

Independent agents were our focus when we wrote our firstpolicy in 1946, and they remain our primary focus today in our61st year of operation.

As a proud sponsor of PIA of Florida, we pledge to continue towork hard to maintain stability and consistency for agents andcompanies.

Supporting the independent agency system for more than 60 years

By Kellie BrayAssistant Vice President, Federal AffairsPIA National

N o matter the outcome of theNovember elections, one thing iscertain. A lame duck session will

begin on November 13 in the House ofRepresentatives and the United StatesSenate.

The term “lame duck” originated inthe 1700s regarding stockbrokers whocould not meet their debts. In the 1860s,the term was applied to politicians. Alame luck session now refers to a formalmeeting of old members of an organiza-tion after the election of new members,but before the new terms have started.

Some politicians find themselves inpeculiar situations during a lame duck ses-sion. Those who will not be returning tooffice because of retirement, electiondefeat or term limit do not really face con-sequences for their actions or the votes thatthey cast. In most election years, Membersof Congress usually do not want to returnto Washington for a lame duck session.Instead, they try to finish all legislativebusiness before the November election,however that is not the case in 2006.

Various 2007 fiscal year spending billsare still to be completed before the end ofthe year, so Congress must return.

While the Senate is hoping to call itquits for the year by Thanksgiving, HouseRepublican leaders have already left openthe likelihood of meeting for at least acouple weeks of business in December.

New Chairman to beNamed

The current chairman of the FinancialServices Committee, Michael Oxley (R-OH) will retire at the end of the 109thCongress leaving the gavel up for grabs.The Speaker of the House and the steer-ing committee of the majority party selectcommittee chairmen. Currently, there aretwo front-runners for the chairmanship if

the Republicans retain the majority andthe Democratic Ranking Member wouldbe an almost sure bet if the Democratstake the majority in the November elec-tions. Here are the lead contenders:

Representative SpencerBachus (R-AL)

Representative Bachus is serving his7th term in the House of Representativesand is currently the subcommittee chair-man for the Subcommittee on FinancialInstitutions and Consumer Credit. Thesubcommittee has jurisdiction over banks,credit unions, thrifts and the federal agen-cies that regulate them, including the Fed-eral Reserve, the U.S. Treasury and theComptroller of the Currency. Prior to hisservice in the House, Bachus owned asawmill, was a practicing criminal triallawyer, and served as a state legislator andthe chairman of the Alabama GOP.

Representative RichardBaker (R-LA)

Representative Baker serves as the sub-committee chairman for the Subcommit-tee on Capitol Markets, Insurance andGovernment Sponsored Enterprises.Baker continued with a subcommitteechairmanship after he failed in a run forchairmanship of the then-Banking Com-mittee in 2000, when the committee wasrestructured and became the FinancialServices Committee, with RepresentativeMike Oxley named as Chairman.

Chairman Oxley and RepresentativeBaker cultivated a close working relation-ship and worked on major legislationover the years to bolster corporateaccountability and give the insuranceindustry a backstop following potentialterrorist attacks.

Representative BarneyFrank (D-MA)

If the Democrats win the majority in theNovember elections, the most likely chair-man of the Financial Services Committee

would be current Ranking Member BarneyFrank of Massachusetts. RepresentativeFrank is serving his 13th term and has neverwon with less than 60 percent of the vote.

Frank is an ardent supporter of afford-able housing and community develop-ment, especially for low income Ameri-cans. One of Frank’s priorities on theFinancial Services Committee has beenattention to housing issues; he opposedPresident Bush’s efforts to curtail spendingon rent assistance for low-income families.

Representative PaulKanjorski (D-PA)

While the Chairmanship of the Finan-cial Services Committee would probablygo to Rep. Frank in a Democratic Con-gress, a major player on the panel will be11-term Representative Paul Kanjorski ofPennsylvania. He is the Ranking Memberon the Financial Services Subcommitteeon Capital Markets, Insurance and Gov-ernment Sponsored Enterprises, whichhas jurisdiction over insurance matters.

Kanjorski is well-attuned to the viewsof professional insurance agents, and PIAhas an excellent working relationshipwith him. Last month, on the day whenRep. Ed Royce (R-Calif.) introduced abill calling for an optional federal charterfor insurers, which PIA adamantly oppos-es, Rep. Kanjorski was careful not toendorse it; in fact, he discussed the matterwith PIA lobbyists the night before.

The outcomes of the November 7 elec-tions will determine the direction the110th Congress will go starting in January2007. But before that happens there willbe that time-honored ritual known as thequacking of the lame ducks, before theyfinally waddle off the national stage.

Kellie Bray kelliebr@pianet.org is AssistantVice President of Federal Affairs for PIANational.

Perspective

Things That Go “Quack” onCapitol HillA Lame Duck Session and What May Lie Ahead

October 2006 7www.pianet.com

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868003_rim_06_025 9/28/06 7:07 PM Page 1

By Rep. Frank Wald (North Dakota)President, National Conference of Insur-ance Legislators (NCOIL)

T he long and successful record ofstate insurance regulation is at acritical juncture. New federal

efforts to reform insurance oversightthreaten to undo the many decades ofstate regulation that have protected con-sumers, forestalled insolvencies, and pro-moted competitive insurance markets incommunities across the country.

We at the National Conference ofInsurance Legislators (NCOIL) do nothave our heads in the sand. Marketplaceand political realities, including theincreasingly global nature of insurance,demand more than protecting and pre-serving the status quo. State regulation isevolutionary, and legislatures have mademeaningful and measurable progress toimprove state oversight for the benefit ofconsumers and the industry.

In just two short years, 28 states haveadopted an Interstate Compact for life,disability, annuity, and long-term careinsurance products, with legislationpending in nine (9) other jurisdictions.The compact, based on an earlierNCOIL model and benefiting from sub-stantial NCOIL input, will be opera-tional by year-end and reflects the swift-ness in which states can work to speedinsurance products to market.

More than 40 states have enactedcompetitive rating for some or all com-mercial risks, and approximately half thestates now exempt sophisticated commer-cial insurance transactions from rate fil-ing requirements, including historicallyrestrictive Massachusetts. Personal linesinsurers benefit from streamlined ratingstandards in dozens of states, while open-rating initiatives continue across thecountry, based largely on two NCOILmodel laws.

Federal “reform” efforts ignore the factthat nearly all states operate under func-

tional reciprocity for agent and brokerlicensing, as well as ignore state progressregarding uniformity of market conductsurveillance. NCOIL efforts in this area,including pending revisions to anNCOIL model bill, will make the statu-tory changes needed to help regulatorstake efficient and effective market con-duct actions.

The hard truth is that only states arewell-suited to oversee insurance. A feder-alized system, whether it is an optionalfederal charter (OFC) or a “nationaltools” approach such as the State Mod-ernization and Regulatory Transparency(SMART) Act, would impose on con-sumers the unwanted by-products of fed-eral oversight, as would associationhealth plans (AHPs), interstate healthsales, and other preemptive health insur-ance initiatives.

A far-off federal regulator could hardlygive consumers quick and effectiverecourse in times of need, and could notappreciate the local dynamics in whichconsumers live and agents and insurersoperate. Local officials are more respon-sive and flexible at guarding against mar-ketplace abuse, and eroding those protec-tions — without consumer demand —would only hurt policyholders and theindustry.

Any national mechanism would even-tually require a sizeable bureaucraticbudget, likely to be subsidized by some ofthe $13 billion that states now collect inpremium tax revenue. This is money thatfunds critical programs, including educa-tion, infrastructure, and health services,and is a significant budget item for manystates. An OFC system would call on fed-erally chartered companies to pay statepremium taxes and contribute to stateguaranty funds and residual marketmechanisms, while also supplementingthe costs of a federal structure. Do any ofus believe that federally chartered compa-nies will stay generous for long? It’s likebelieving that Al Capone sold tickets to

the Chicago policemen’s ball.National programs have a poor track

record of protecting consumers and con-taining costs. ERISA is widely recog-nized, including within Congress, asflawed legislation that has tied the handsof state lawmakers looking to help localconsumers. The National Flood Insur-ance Program (NFIP), though well-intentioned, is not engineered to befinancially sound or to sufficientlyaddress the expectations of flood victims.Medicare Part D kicked off with wide-spread consumer confusion and still-lin-gering administrative missteps.

PIA has said that a pending OFC bill“reads like a book by horror novelistSteven King.” NCOIL could not agreemore. A one-size-fits-all scheme would bevulnerable to the political whims of Con-gress and would impede states’ ability totake emergency action following naturaland man-made disasters. What works inBismarck may not succeed in the FloridaKeys.

Those who have spent millions of dol-lars pushing for an alternative to the statesystem would be gratified by a nationalapproach. But a federal system is nopanacea — states need to continue evolv-ing in a more complex world.

True believers in state regulation —like NCOIL and PIA — are charged withmobilizing their energies to overcomeunwise federal efforts and the vigorouslobbying efforts of some in the insuranceindustry.

Folks asking for federal oversight maywant to be careful what they wish for, asper an Oscar Wilde quote used in themovie Out of Africa — “When the godswish to punish us, they answer ourprayers.”

Rep. Frank Wald is President of the NationalConference of Insurance Legislators.

Perspective

State Regulation at a Crossroads: Be Careful What You Wish For

October 2006 9www.pianet.com

O n September 15, 2006, PIA filedan amicus curiae brief with theUnited States District Court for

the District of New Jersey, in oppositionto certain limited aspects of a proposedclass settlement involving Zurich Insurers.

PIA’s objections to the proposed settle-ment center on a selective ban on the pay-ment of contingent commissions, alongwith the mandated use of a flawed disclo-sure statement that creates legal conflicts.

“A key mission of PIA is to defend theintegrity of our members and protecttheir business interests,” said PIA Execu-tive Vice President & CEO Len Brevik.

“The alleged abuses that led to thesesettlements were not committed by MainStreet insurance agents,” Brevik said.“Regrettably, this proposed settlementand others like it attempt to create a rem-edy for alleged wrongdoing and thenimpose it on those who were not involvedin any wrongdoing. As a result, PIA iscompelled to address these issues formallythrough our direct involvement in thisclass action, on behalf of our membersand their business interests.”

“Certain provisions contained in theseagreements are grossly unfair to PIAagents, and grossly unfair to carriers byrestricting their ability to compensatetheir producers in a legal and honestmanner,” he added.

Lack of FairnessStarting in late 2004, several state

Attorneys General announced that theyhad uncovered instances of alleged bid-rig-ging in dealings involving a handful oftop-of-the-marketplace “Mega-brokers” ininsurance. The resulting settlement agree-ments sought to ban certain contingentcommissions. Terms in these settlementswere then applied not just to the Mega-brokers in question, but broadly to includeMain Street insurance agents, who hadnever been accused of wrongdoing.

Brevik added that PIA’s filing alsoaddresses the broader issue of efforts byseveral Attorneys General to use the set-tlement process to compel support forchanging the way American businessoperates by attempting to make incentivecompensation illegal. In the case of theproposed settlement involving Zurich,

this includes a provision requiring thecompany to “support legislation and reg-ulations in the United States to abolishContingent Compensation for insuranceproducts or lines.”

“State Attorneys General should notusurp the policymaking authority of statelegislatures,” Brevik said. “Specifically,they should not use their powers in aneffort to bring about a fundamentalchange in the American system of freeenterprise. Performance-based compensa-tion is not a threat to that system, it is thebasis of that system.”

The PIA filing also notes that severalof the original settlements reached in2004 have, in recent weeks, been amend-ed by state Attorneys General to liberalizeearlier prohibitions against receiving anycontingency earnings, in signed settle-ments involving Marsh, Aon and Willis,among others — while not changingaspects of settlements that may adverselyimpact Main Street agents, who werenever accused of any wrongdoing.

“These voluntary settlement agree-ments, which are not truly voluntary, arebeing entered into by carriers under threatof legal sanction by various state AttorneysGeneral,” said PIA National President-elect Donna Pile. “Provisions in these set-tlements place the burden of these sanc-tions squarely on the shoulders of the localMain Street agents, creating an enormousfinancial strain on our PIA agencies. It isdangerously disconcerting that the MainStreet agent force is paying the price for afew wrongdoers from a totally differentarena. This is not due process.”

Flawed DisclosureAs part of the proposed settlement of a

class action lawsuit filed in August 2005,which was prompted by investigations ofalleged bid-rigging conducted by severalstate Attorneys General, independentagents would be required to use a court-mandated Mandatory Disclosure State-ment that is inaccurate, violates existingstate and common law and is rife with seri-ous and fatal flaws. While pointing out tothe court that PIA has no intent to obstructthe consummation of the Zurich Class Set-tlement, nevertheless “any perceived needfor expediting the settlement process can-

not justify the serious and fatal flaws” in themandated disclosure statement.

“PIA tried to participate in the draftingof the Mandatory Disclosure Statement,but was unfairly locked out of those negoti-ations,” said PIA National Vice President/Treasurer Kenneth R. Auerbach, Esq.“Unfortunately, the carriers involved inthis process are in no position to makemodifications to these imposed results.So, the system left PIA with no otheroption to be heard. PIA is compelled tofile our comments together with our pro-posed changes to the disclosure statementdirectly with the court, as a friend of thecourt, for its consideration.”

Ten State AGs OpposePIA Amicus

As might be expected, the ten Attor-neys General did not agree with PIA. OnSeptember 27, 2006, the AGs filed amotion with the U.S. District Court for-mally opposing PIA’s amicus brief.

The Attorneys General of the States ofCalifornia, Florida, Hawaii, Maryland,Oregon, Texas and West Virginia and theCommonwealths of Massachusetts, Penn-sylvania and Virginia contended that thefiling of PIA’s Brief of Amicus Curiae ispremature at this stage of the litigation.

“We have ten AGs opposing usbecause we have filed the first and mostcomplete brief defending Main Street

PIA Files Brief Opposing Contingency and Disclosure Settlements

10 October 2006www.pianet.com

PIA’s Action Draws Opposition from Ten State Attorneys General

PIA FilesBrief. PIANational VicePresident/Treasurer Kenneth R.Auerbach, Esq.works on PIA’sbrief of amicuscuriae whichwas filed withthe U.S. DistrictCourt for theDistrict of New Jersey.

agents,” said PIA’s Brevik immediatelyafter the filing. PIA filed a responsethe next week.

The AGs filing contended that“PIA’s concerns are more properlyreserved for the final fairness hearing— not preliminary approval.” It alsostates, “PIA’s objections have little todo with the reasonableness of the Set-tlement, and focus instead on thescope and proper interpretation of theDisclosure Form. These objections aremore appropriately raised and consid-ered at the final approval hearing...”

“It is not fair to relegate the con-cerns of professional insurance agentsto a late-stage, final fairness hearing,”Brevik commented.

“Since there hasn’t been fairness foragents since the beginning of thisprocess, we are not confident thatthere will be now,” he said. “Far frombeing premature, PIA’s participationhas been blocked. From the start, PIAagents were rebuffed in all of ourattempts to participate in the negotia-tions that brought this proposed set-tlement to this point. Now that wehave brought our objections directlyto the court, the AGs want to relegateagents and their concerns to the backof the bus.”

The day after the Attorneys Gener-al filed their motion, attorneys forZurich sent a detailed letter to presid-ing Judge Faith S. Hochberg. In it,Zurich said that PIA’s brief is prema-ture and also argued against the AGsby stipulating the scope of issuesbefore the Court in this settlementwas much broader than the AGs con-tend it is. Zurich acknowledged that itintends for the full set of issues to bepresented before and approved by thiscourt, so they achieve a global settle-ment applied in all states, not just theten in question.

PIA is not blaming the carriers forthis situation. We filed our brief inorder to help the court understandwhy our members cannot use the pro-posed disclosure form. Our complaintis with the process and the remedyproposed by the attorneys general, notwith the carriers that have been

unfairly leveraged and forced to sub-mit to an unfair settlement.

Georgia CommissionerWon’t Sign On

In a keynote address to more than500 agents during PIA of Georgia’sannual Education EXPO in Atlanta onSeptember 26, Georgia InsuranceCommissioner John W. Oxendineentered the fray. Oxendine said he willnot sign on to recent controversial pro-posed settlement agreements withinsurance companies — such as theone involving Zurich — which requirethat agents use a court-mandated formto disclose current and future commis-sion levels to their insureds.

Oxendine stated that he “has noplans to require Georgia’s agents totake part” in the disclosure and felt it“served no worthwhile purpose.”

The Broader IssueIn taking these actions, PIA’s Main

Street agents were doing more thansimply standing up for their own busi-ness interests.

They entered the legal arena tooppose an unfair proposed settlementand by doing so, protect a guidingprinciple of the American system offree enterprise: the ability to pay sales-people compensation based on theirperformance.

Commissions, contingent or not, area mainstay of our economy. In ourindustry, they also support critical, pro-fessional front line underwriting byagents to assure the financial health andsolvency of insurers that we all rely on.

These settlements propose to fun-damentally change the way in whichmost American businesses operate.Rather than attempting to bringabout the elimination of incentivecompensation as a means of discour-aging abuses of the system, stateAttorneys General should concentrateon policing such abuses.

“The day when it becomes illegalto sell on commission is the day whenthe American Free Enterprise Systemwill have suffered a death blow,” Bre-vik said.

October 2006 11www.pianet.com

ure Settlements

TimelineMarch 2006 — Twelve state AGs and DOIsannounce the first set of a series of inter-twined multi-state settlements involvingalleged insurer actions connected to the 2004broker compensation and competitive practiceactions. PIA provides detailed comments toZurich at Zurich’s request, especially regard-ing the per transaction producer compensa-tion disclosure.

April 9, 2006 — Zurich executives appearbefore the PIA National Board of Directors andpresent the details of their three different, butconnected, settlements and their accompany-ing imposed business reforms.

April 2006 — Multiple plaintiffs’ lawsuits havebeen filed in the wake of actions by New YorkAttorney General Eliot Spitzer and other offi-cials. These are certified as part of a universalclass action to be heard in U.S. District Courtfor the District of New Jersey.

Both Zurich and Travelers are named as defen-dants in the Commercial Class Action Com-plaint, which seeks both damages and injunc-tive relief, including injunctive relief to “restorecompetition” and “cure the inherent and irrec-oncilable conflict of interest created by theexistence of the Contingent Commissions.”

Federal District Judge Faith S. Hochberg must determine whether the terms of the proposed settlement are “fair, reasonable and adequate” to absent class members.

July 31, 2006 — Plaintiffs’ counsel and Zurichreach a proposed settlement of the commer-cial class action.

September 15, 2006 — PIA files the first briefof amicus curiae with the United States Dis-trict Court for the District of New Jersey, inopposition to certain limited aspects of theproposed settlement.

September 26, 2006 — Attorneys General often states file a motion in opposition to PIA’samicus curiae, asking the Court not to hear itat this time.

September 26, 2006 — Attorneys for ZurichInsurers send a letter to Judge Hochberg, con-firming PIA’s assertion that what is beingsought is approval of a broad, global, “nation-wide” settlement that folds all details of exist-ing proposed agreements into a comprehen-sive settlement, including a selective ban onthe payment of certain contingent commis-sions. This contradicts the AGs assertion thatthe proceeding is dealing with narrow issues.

October 6, 2006 — PIA files a formal reply tothe AGs motion, asking the Court to delay pre-liminary approval of the class settlement untilflaws in the mandatory disclosure statementare corrected. PIA says arguments in the AGsmotion “lack merit and appear designed toevade PIA’s legitimate concerns.”

Farmers Mutual of NebraskaNamed PIA National Company of the Year

T he recipient of the 2006 PIA National Company Award ofExcellence is Farmers Mutual Insurance Company ofNebraska.

The annual PIA National Company Award of Excellence hon-ors companies for their commitment to PIA, to the AmericanAgency System, and to furthering the interests of and creating abetter business environment for professional independent insur-ance agents. The award was presented during a ceremony Septem-ber 9, 2006 in Savannah, Georgia.

“Farmers Mutual has always been a steadfast supporter of PIA,”said PIA National President Ray Peretti, who presented the award.“The company also believes that its success is tied directly to thesuccess of its agents.”

“In the case of our winner consider this,” Peretti said. “Everypolicy ever issued by Farmers Mutual Insurance Company ofNebraska has originated from an application submitted by anindependent agent — ever since the company’s inception in1891.”

The award was accepted by Les Hileman, vice president of agen-cies for Farmers Mutual Insurance Company of Nebraska.

PIA National Names the MacNeill Group 2006 Managing General Agency of the Year

T he MacNeill Group has been honored by being namedthe recipient of the first annual PIA National ManagingGeneral Agency of the Year Award.

The award recognizes outstanding achievement in further-ing the interests of agents, a commitment to the agency systemand successful efforts to create a better business environmentfor professional insurance agents.

The award was presented during a ceremony in Savannah,Georgia on September 9, 2006.

“The MacNeill Group, isunique in that it’s partnership withand support of PIA of Florida goesback 50 years,” said PIA NationalVice President/Treasurer RobertPage, who presented the award.“When the first of the recent bighurricanes hit Florida in 2004, theMacNeill Group’s president was onthe phone to PIA with one ques-tion: ‘How can we help?’ Mac-Neill’s dedication to agents contin-ued throughout the devastating2004 hurricane season and into2005’s.”

The nomination of the Mac-Neill Group was made by PIA ofFlorida. “MacNeill has an unsur-passed commitment to PIA ofFlorida, as evidenced by their 50-

year strong membership, the longest-standing partner mem-bership in our organization,” noted PIA of Florida ExecutiveVice President Mark O’Connell in making the nomination.“This commitment to PIA extends to agents across the stateand is evidenced by MacNeill’s support during the horrific2004 and 2005 hurricane seasons when the company reachedout to insureds and agents alike, offering assistance.”

The award was accepted by MacNeill Group PresidentDoug Bullington.

PIA National 2006 Company Awards

12 September 2006www.pianet.com

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PIA National President Ray Peretti (left) presented the 2006 PIA NationalCompany Award of Excellence to Les Hileman, vice president of agenciesfor Farmers Mutual Insurance Company of Nebraska.

PIA National 2006 Managing General Agency of the Year awardwinner, MacNeill Group, Inc. From left: Kevin Tromer, senior vicepresident, MacNeill Group, Inc.; Ray L. Peretti, CIC, FMS, presi-dent, PIA National; Doug Bullington, president, MacNeill Group,Inc.; Gus Fernandez, senior vice president, MacNeill Group, Inc.

September 2006 13www.pianet.com

PIA National Names Tricia Zeff 2006 Company Representative of the Year

Patricia L. “Tricia” Zeff, CIC, CPIW, CISR has been namedthe 2006 PIA National Company Representative of the Year.

The annual award honors an outstanding company representa-tive for their professional experience, assistance given to agents,technical knowledge and demonstrated awareness of industryproblems and market conditions. Their contributions to the indus-try through participation in PIA and other insurance organizationsare also considered, as are their contributions to serving the publicand their community.

The award was presented September 9, 2006 by PIA NationalPresident-elect Donna Pile during a ceremony in Savannah, Geor-gia held in conjunction with a national PIA board of directorsmeeting.

Zeff is Supervisor and a Lead Underwriter for NAI, NorthAlabama Insurance, an excess and surplus lines broker that writesbusiness and appoints agents in Tennessee.

“Tricia Zeff has distinguished herself in service to agents in Ten-nessee,” Pile said. “She says that her primary responsibility is toassist agents secure coverage for their insureds.”

In June of this year, Zeff was awarded the PIA Company Repre-sentative of the Year Award by PIA of Tennessee.

eill Group 2006 Managing

year strong membership, the longest-standing partner mem-bership in our organization,” noted PIA of Florida ExecutiveVice President Mark O’Connell in making the nomination.“This commitment to PIA extends to agents across the stateand is evidenced by MacNeill’s support during the horrific2004 and 2005 hurricane seasons when the company reachedout to insureds and agents alike, offering assistance.”

The award was accepted by MacNeill Group PresidentDoug Bullington.

PIA National President-elect Donna Pile presents the 2006 PIA NationalCompany Representative of the Year award to Tricia Zeff, CIC, CPIW, CISR,an employee of NAI (North Alabama Insurance), Florence, AL.

eral Agency of the Year awardm left: Kevin Tromer, senior viceRay L. Peretti, CIC, FMS, presi-on, president, MacNeill Group,resident, MacNeill Group, Inc.

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By Kristi L. Deily Manager, Political AffairsPIA National

P IAPAC is governed by its own set of bylaws and a board ofdirectors made up of 16-19 national directors, pastnational directors, and other interested PIA members.

Annually, these directors measure the result of the politicalaction committee’s objectives and revise or recalibrate them forthe next calendar year.

For 2006, the board determined four objectives. All may besummed up as this: increase participation, contributions, under-standing, and awareness.

To remain relevant in the political process, all PACs must focusa great deal of thought and energy on growth. Not only are cam-paigns getting more and more expensive but competitors’ PACs arecertainly focused on growth and, if we do not keep up, we will beoutpaced. For example, an insurance trade group just announced apush to more than double the size of their PAC next cycle to onemillion dollars. This group supports legislation to create an option-al federal charter for insurers — which PIA adamantly opposes.

To be effective, we must mirror their resolve. PIAPAC Com-mittee member Larry McGillis from North Dakota says it best,“Why should I save pennies to lose dollars?”

Here is where PIAPAC stands on our 2006 objectives:1. 2006 Objective: Increase contributions to PIAPAC by 25%

more than the 2004 election cycle (approximately $200,000)making the goal for the 2006 cycle $250,000 or more.2006 Results: As of December 31 of last year, PIAPAC hadreceived $116,615 putting us short of the half-way mark inreaching our goal. As of October 10, 2006, PIAPAC con-tributions are at $115,500. We need to raise an addition-al $17,885 by December 31 in order to reach our goal.

2. 2006 Objective: Achieve 100% PIAPAC participationfrom the PIA National Board of Directors.2006 Results: As of August 15, 2006, 100% have con-tributed, or 39 of 39 National Directors.

3. 2006 Objective: Achieve 100% PIAPAC participationfrom each PIA affiliate’s Board of Directors through the2006 Chairman’s Challenge.2006 Results: As of October 10th, 40% or 184 of 459Affiliate Directors have contributed to PIAPAC this year.Connecticut, Michigan, Oklahoma and Washington havereached 100% participation. Others are within reach.

4. 2006 Objective: Increase PIA member awareness, under-standing, and participation in PIAPAC.2006 Results: We continue to promote participation inPIAPAC through the Chairman’s Challenge and throughfull membership solicitations, through Connection andNewsline ads and articles, and through the newlyredesigned PIAPAC website.

The first three of these objectives are easy to quantify, while the

fourth objective is moredifficult to measure. It issafe to say, however, thatif the first three havebeen met then thefourth has been met as well. We are working hard to meet theobjectives, but we need your help. Please contribute online todayat http://www.pianet.com/PIAPAC/.

If you believe national political involvement is vital to thesuccess of each professional insurance agent and would like toencourage your colleagues to become involved, please contactme directly and let’s work together.

If you serve on an affiliate board and want to see your affiliateachieve the “Chairman’s Challenge” (100% participating from theaffiliate board of directors), I look forward to hearing from you so thatwe can make that happen. I can be reached at kristide@pianet.org.

Together we are helping to elect pro-insurance, pro-businesslegislators to the U.S. Senate and House of Representatives.Together we are making a difference!

Kristi L. Deily kristide@pianet.org is Manager of Political Affairs forPIA National.

Perspective

PIAPAC: Setting Goals and Meeting Objectives

September 2006 15www.pianet.com

Each PIAPAC Contributor

Really Counts

Join the 783 PIA members who have already contributed to PIAPAC this year.

Contribute today and watch this number grow!

Visit www.PIANET.com or contact Kristi Deily at (703) 518-1365, kristide@pianet.org

PIA Political Action Committee

I f you’ve been hearing about the Insur-ance On-line Network, or ION, butdon’t know much about it or how it

can benefit your agency, now’s yourchance to learn more and ask questions.Starting on Tuesday, November 14, 2006,the carriers who make up ION will beputting on two WebEx presentations tointroduce the program to PIA members,followed by two more presentations toprovide staff training to those PIA mem-ber agencies who would like to use IONto improve their term life sales. Please seethe box on this page for dates and regis-tration information.

These WebEx presentations are pro-vided as an additional service to PIAmembers. Attending these sessions is notrequired to participate in the PIA/IONprogram. To learn more and get startedimmediately, please log on tohttp://www.PIANET.com/ION.

What is ION?ION is an easy-to-use, on-line, multi-

carrier, life insurance quoting system. Thisweb-based service represents term prod-ucts from multiple carriers and offers pro-ducers the opportunity to fill out a short“request for application” form on-line,thus initiating the application process.

Life Alliance LLC, a joint venturebetween subsidiaries of The Hartford1 andProtective Life2, developed ION. IONmakes it easier and quicker for producersto provide clients with quotes on term lifeinsurance from multiple carriers, from theconvenience of their own desktops.

With just a few key strokes, lifelicensed producers can obtain quotes on10, 15, 20 and 30-year level term lifepolicies with face amounts starting at$100,000 from The Hartford, ProtectiveLife, and Transamerica Occidental Life3

in an easy-to-read comparative format.

Easy as 1-2-3!Once in ION, all you need is basic

client information, such as name, date ofbirth, gender, issue state, rate classification(nicotine or non-nicotine user), and pay-ment mode in order to obtain a quote. Allthree carriers will be displayed on thescreen with up to three different risk clas-sifications. From this same page you canalso access carrier information as well asproduct information for each carrier.

Once you and your client select aquote from a participating carrier, andyou have been appointed by that carrier,you can electronically submit the requestfor application to that carrier. There areno medical questions asked at time ofquote; this is all handled through the tele-interview at a time that is convenient forthe client.

ION is a free service available to you asa valued PIA member. ION is now avail-able to PIA members in all 50 states andthe District of Columbia.

Sign Up Now!To register for these ION WebEx

presentations, please go tohttp://www.pianet.com/ionwebexregistration.To learn more about ION, please log onto http://www.PIANET.com/ION.

When logging on, bring this copy ofPIA Connection with you. The numberabove your name on the mailing label isyour PIA National member identificationnumber, which also serves as your defaultusername for our website. You’ll need thisto enter ION.

Please direct any questions to PIA’sAlexi Papandon at alexipa@pianet.org or(703) 518-1353.

1 The Hartford is The Hartford Financial Ser-vices Group, Inc, and its subsidiaries,including the issuing companies of HartfordLife Insurance Company and Hartford Lifeand Annuity Insurance Company.

2 Protective Life Insurance Company(PLICO) is a subsidiary of Protective LifeCorporation, which is separate companyand is not responsible for the financial con-dition or contractual obligations of PLICO.

3 Transamerica Occidental Life isTransamerica Occidental Life InsuranceCompany, Cedar Rapids, IA 52499.

Get to Know ION: Insurance On-lineNetwork WebEx Presentation SeriesIntroductory and Training WebEx Sessions to Be Offered to PIA Members

16 October 2006www.pianet.com

PIA Member InsuranceOn-line Network (ION)WebEx Presentations

(1) Tuesday 11/14/064pm Eastern“INTRODUCTION TO ION”

(2) Thursday 11/30/062pm Eastern“INTRODUCTION TO ION”(repeat of 11/14 presentation)

(3) Tuesday 12/5/064pm Eastern“ION TRAINING”

(4) Thursday 12/14/062pm Eastern“ION TRAINING”(repeat of 12/5 presentation)

Register Online athttp://www.pianet.com/ionwebexregistration

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PIA Connection Marketplace rates: $70/issue for 10 issues; $80/issue for 5 issues. To learn more and get a contract, or to inquire aboutdisplay advertising, please contact Alexi Papandon at alexipa@pianet.org or 703-518-1353.

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T he new national officers of PIA were installed during thegroup’s September 10, 2006 Board of Directors meeting heldin Savannah, Georgia. Each of the officers will serve one-year

terms that began on October 1, 2006.On October 1, Donna Pile, CIC, CPIW, CPIA, of Lexington,

Kentucky became President of PIA National; Robert P. Page ofHouma, Louisiana became President-elect; Kenneth R. Auerbach,Esq. of Eatontown, New Jersey became Vice President/Treasurer;Jon D. Spalding of Perry, Michigan became Secretary/Assistant Trea-surer; and outgoing PIA National President Ray L. Peretti, CIC,FMS, of Renton, Washington became Immediate Past President.

“I want to thank every person in this room for whatever role youplay in this association to move it forward,” said Pile, in remarks tothe PIA National Board of Directors. “It’s a personal sacrifice, it’s apassion and it’s a dedication. All of you are leaders in the industry.All of you have passion for PIA and I want to thank you for the con-tribution you make that has helped this association become 75 yearsstrong and the best representative of professional insurance agentsacross the country.”

PIA National Officers Installed

PIA National’s New Officers: Donna Pile, CIC, CPIW, CPIA, president; Robert P. Page, president-elect; Kenneth R. Auerbach, Esq.,vice president/treasurer; Jon D. Spalding, secretary/assistant treasurer.

PIA Working with NAICContinued from page 5

18 October2006www.pianet.com

bers must follow.PIA is attacking this issue on several

fronts. In addition to our efforts at theNAIC, we are also working with NCOILand have filed an amicus brief in the classaction lawsuit in New Jersey addressingthe settlement. By working together, wecan combat this wrongful attempt to forcean unfair burden on our segment of theindustry because of the misdeeds of a fewlarge brokerage firms.

David M. Eppstein davidep@pianet.org isDirector of State Affairs for PIA National.

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sNEBRASKA/IOWAPIA of Nebraska/Iowa, 920 South 107th Avenue, Suite 305, Omaha, NE 68114PHONE: (402) 392-1611 • FAX: (402) 392-2228e-mail: piane@pianebraska.com • Web Site: www.pianebraska.comNEW HAMPSHIREPIA of New Hampshire, P.O. Box 997, Glenmont NY 12077-0997PHONE: (800) 424-4244 • FAX: (518) 434-2342e-mail: pia@piaonline.org • Web Site: www.piaonline.orgNEW JERSEYPIA New Jersey, P.O. Box 997, Glenmont NY 12077-0997PHONE: (800) 424-4244 • FAX: (518) 434-2342e-mail: pia@piaonline.org • Web Site: www.piaonline.orgNEW YORKPIA New York, P.O. Box 997, Glenmont NY 12077-0997PHONE: (800) 424-4244 • FAX: (518) 434-2342e-mail: pia@piaonline.org • Web Site: www.piaonline.orgNORTH CAROLINAPIANC, 16976 Justice Branch Road, Littleton, NC 27850PHONE: (704) 892-4645 • (877) 337-4262 • FAX: (704) 892-4645e-mail: piaofnc@piaofnc.com • Web Site: www.piaofnc.comNORTH DAKOTAPIA of North Dakota1211 Memorial Hwy Holiday Park Office #6, Bismarck, ND 58504-5213PHONE: (701) 223-5025 • (800) 733-1050 ND&MN onlyFAX: (701) 223-9456 • e-mail: piand@btinet.net • Web Site: www.piand.comOHIOPIA of Ohio, Inc., 600 Cross Pointe Road, Gahanna, OH 43230PHONE: (614) 552-8000 • (800) 555-1742 • FAX: (614) 552-0115e-mail: ohpia@ohiopia.com • Web Site: www.ohiopia.comOKLAHOMAPIA of Oklahoma, P.O. Box 12921, Oklahoma City, OK 73157PHONE: (405) 942-1119 • FAX: (405) 943-4380e-mail: bill@piaok.com • Web Site: www.piaok.comOREGON/IDAHOPIA of Oregon/Idaho, 3205 Northeast 78th Street, #104, Vancouver, WA 98665PHONE: (503) 287-7570 • FAX: (360) 571-7600e-mail: clark@piawest.com • Web Site: www.piawest.comPENNSYLVANIAInsurance Agents & Brokers of Pennsylvania P.O. Box 2023, Mechanicsburg, PA 17055-0763PHONE: (717) 795-9100 • FAX: (717) 795-8347e-mail: timw@iabgroup.com • Web Site: www.iabgroup.comPUERTO RICO & CARIBBEANPIA of Puerto Rico and the Caribbean IncPO Box 192389, San Juan, PR 00919-2389PHONE: (787) 792-7849 • FAX: (787) 792-4745e-mail: marcos@piaofpr.com • Web Site: www.piaofpr.comRHODE ISLANDPHONE: (703) 836-9340 • FAX: (703) 836-1279e-mail: ellenbo@pianet.org • Web Site: www.pianet.comSOUTH CAROLINAPIA of South Carolina, PO Box 21367, Columbia, SC 29221-1367PHONE: (803) 772-0557 • (888) 742-6372 • FAX: (803) 772-0846e-mail: PIASC@piasc.net • Web Site: www.piasc.netSOUTH DAKOTAPHONE: (703) 836-9340 • FAX: (703) 836-1279e-mail: ellenbo@pianet.org • Web Site: www.pianet.comTENNESSEEPIA of Tennessee Inc, 504 Autumn Springs Court Suite A-2, Franklin, TN 37067PHONE: (615) 771-1177 • FAX: (615) 771-3456e-mail: piatn@piatn.com • Web Site: www.piatn.comTEXASTexas Insurance Professionals, P. O. Box 90908, Austin, TX 78709-0908PHONE: (512) 301-0226 • FAX: (512) 301-0265e-mail: pia@piatx.org • Web Site: www.piatx.orgUTAHUtah Association of Independent Insurance Agents4885 S. 900 E., Suite 302, Salt Lake City, UT 84117PHONE: (801) 269-1200 • FAX: (801) 269-1265e-mail: stevebaugh@mcleodusa.net • Web Site: www.uaiia.orgVERMONTVermont Insurance Agents Association, P.O. Box 1387, Montpelier, VT 05601PHONE: (802) 229-5884 • FAX: (802) 223-0868e-mail: rcoyle@viaa.org • Web Site: www.viaa.orgVIRGINIA/DCPIA Assn of Virginia & DC, 8092 Villa Park Drive, Richmond, VA 23228PHONE: (804) 264-2582 • FAX: (804) 266-1075e-mail: dennis@piavadc.com • Web Site: www.piavadc.comWASHINGTON/ALASKAPIA of WA/AK, 3205 Northeast 78th Street, #104, Vancouver, WA 98665PHONE: (360) 571-7100 • FAX: (360) 571-7600e-mail: clark@piawest.com • Web Site: www.piawest.comWEST VIRGINIAPHONE: (703) 836-9340 • FAX: (703) 836-1279e-mail: ellenbo@pianet.org • Web Site: www.pianet.comWISCONSINPIA of Wisconsin, Inc., 6401 Odana Road, Madison, WI 53719-1126PHONE: (608) 274-8188 • (800) 261-7429 • FAX: (608) 274-8195e-mail: rvonhaden@piaw.org • Web Site: www.piaw.orgWYOMINGAssoc. of Wyoming Ins. Agents, PO Box 799, Sundance, WY 82729-0799PHONE: (307) 283-2052 • FAX: (775) 796-3122e-mail: awia@vcn.com • Web Site: www.awia.com

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sALABAMAPIA of Alabama, 421 Twain Curve, Suite 2, Montgomery, AL 36117PHONE: (334) 244-7422 • FAX: (334) 244-9921e-mail: perry@piaal.com • Web Site: www.piaal.comARKANSASPIA of Arkansas Inc., 10 Corporate Hill Dr., Suite 130, Little Rock, AR 72205PHONE: (501) 225-1645 • FAX: (501) 225-2550e-mail: evp@piaar.com • Web Site: www.piaar.comCA/NV/AZ/NMPIA Group, PO Box 15952, Sacramento CA 95852PHONE: (888) 246-4466 • FAX: (360) 571-7600e-mail: clark@piawest.com • Web Site: www.piawest.comCOLORADOPHONE: (703) 836-9340 • FAX: (703) 836-1279e-mail: ellenbo@pianet.org • Web Site: www.pianet.comCONNECTICUTPIA of Connecticut, P.O. Box 997, Glenmont, NY 12077-0997PHONE: (800) 424-4244 • FAX: (518) 434-2342e-mail: pia@piaonline.org • Web Site: www.piaonline.orgDELAWAREInsurance Agents & Brokers of DelawareP.O. Box 2023, Mechanicsburg, PA 17055-0763PHONE: (717) 795-9100 • FAX: (717) 795-8347e-mail: timw@iabgroup.com • Web Site: www.iabgroup.comFLORIDAPIA of Florida, Inc., 1390 Timberlane Road, Tallahassee, FL 32312-1766PHONE: (850) 893-8245 • (800) 277-1171 FL only • FAX: (850) 893-8316e-mail: oconnell@piafl.org • Web Site: www.piafl.orgGEORGIAThe PIA of Georgia, Inc., 3805 Crestwood Pkwy NW #140, Duluth, GA 30096PHONE: (770) 921-7585 • FAX: (770) 921-7590e-mail: jerry@piaga.com • Web Site: www.piaga.comHAWAIIPIA of Hawaii, 146 Hekili St # 201A, Kailua, HI 96734-2835PHONE: (808) 261-9460 • FAX: (808) 262-5355e-mail: piahi@verizon.netILLINOISPHONE: (703) 836-9340 • FAX: (703) 836-1279e-mail: ellenbo@pianet.org • Web Site: www.pianet.comINDIANAPIA of Indiana, 600 Cross Pointe Road, Gahanna, OH 43230PHONE: (614) 552-8000 • (800) 555-9742 • FAX: (614) 552-0115e-mail: inpia@indianapia.com • Web Site: www.indianapia.comKANSASKansas Association of PIAP.O. Box 5513, Topeka, KS 66605-3065PHONE: (785) 232-4143 • FAX: (785) 232-0272e-mail: pia@pia.kscoxmail.com • Web Site: www.KansasPIA.orgKENTUCKYPIA of Kentucky, P.O. Box 4205, Frankfort, KY 40604-4205PHONE: (502) 875-3888 • FAX: (502) 227-0839e-mail: clemay@piaky.org • Web Site: www.piaky.orgLOUISIANAPIA of Louisiana Inc., 8064 Summa Avenue, Suite C, Baton Rouge, LA 70809PHONE: (225) 766-7770 • (800) 349-3434 LA only • FAX: (225) 766-1601e-mail: jody@piaoflouisiana.com • Web Site: www.piaoflouisiana.comMAINEMaine Insurance Agents Association, 432 Western Avenue, Augusta, ME 04330PHONE: (207) 623-1875 • FAX: (207) 626-0275e-mail: bigime@aol.com • Web Site: www.maineagents.comMARYLANDInsurance Agents & Brokers of Maryland P.O. Box 2023, Mechanicsburg, PA 17055-0763PHONE: (717) 795-9100 • FAX: (717) 795-8347e-mail: timw@iabgroup.com • Web Site: www.iabgroup.comMASSACHUSETTSPHONE: (703) 836-9340 • FAX: (703) 836-1279e-mail: ellenbo@pianet.org • Web Site: www.pianet.comMICHIGANThe Association of PIA, 4550 Cascade Road SE, Suite 205-B, Grand Rapids, MI 49546-3697PHONE: (616) 454-4461 • FAX: (616) 454-4491e-mail: pjames@mipia.com • Web Site: www.mipia.comMINNESOTAPIA of Minnesota, 3600 Holly Lane N. #90, Plymouth, MN 55447PHONE: (763) 694-7070 • FAX: (800) 546-3428e-mail: gsather@piamn.com • Web Site: www.piamn.comMISSISSIPPIPIA Association of Mississippi, 4 River Bend Place, #115, Jackson, MS39232PHONE: (601) 936-6474 • FAX: (601) 936-6477 • (800) 898-0136 MS onlye-mail: PIAofMS@aol.com • Web Site: www.piams.comMISSOURIMissouri Association of Insurance AgentsP.O. Box 1785, Jefferson City, MO 65102-1785PHONE: 573-893-4301 • FAX: 573-893-3708e-mail: lcase@moagent.org • Web Site: www.missouriagent.orgMONTANAPIA of Montana, 3205 NE 78th St Ste 104, Vancouver, WA 98665-0697PHONE: (888) 246-4466 • FAX: (360) 571-7600e-mail: clark@piawest.com • Web Site: www.piawest.com

You may have noticed that over the past ninemonths PIA has begun to blanket industrypublications and web sites with ads featur-

ing our new tagline, Local Agents Serving Main Street America.SM

This tagline was designed to give PIA members a compellingbrand identity in the insurance marketplace and serves as thebasis for our exciting new PIA Branding Program.

PIA members can now participate in the PIA Branding Pro-gram by running print advertisements created by your nationalPIA association in your local publications. Ten basic ads have beencreated — in color and black and white, in a variety of sizes —making a total of over 200 total ads PIA members can run. Eachad contains space for your logo and contact information, as well asthe logo of a carrier if you choose to add one. The collection of adscontains two homeowners ads, two auto ads and two commerciallines ads. The remaining ads are general in nature. Spanish lan-guage ads are planned for 2007. Full-page versions of each ad can

be printed for use as flyers or as inserts inpublications.

So why the Shhhh in the headline?Because the official Grand Opening ofthe PIA Branding Program will takeplace in the next issue of PIA Connec-tion. This is your special, advance invi-tation as a loyal PIA member and read-er of the Product Spotlight column. Aswe write this column, the finishingtouches are being made to the PIA Branding Program’s onlinehome, http://www.pianet.com/piabrandingprogram, wherePIA members can learn more and download ads. Go ahead. Takea look. It should be ready. You’ll need your PIA National user-name and password to actually download ads. If you’ve neverlogged in before, simply keep this issue of PIA Connection withyou. Everything you need to login is on the mailing label.

(Shhhh! PIA Has a New Print AdvertisingProgram Exclusively for PIA Members!)

Be sure to visit www.PIANET.com for additional Member Benefits including theAgency Agreement Review Service, PIA logos, member-only resources and more.

Insurance Productsn The Insurance On-line Network (ION)Easy-to-use, on-line, multi-carrier, term lifequoting system. http://www.PIANET.com/IONn Agency Revenue ToolsEmployee worksite marketing using yourappointed markets at regular commissionrates. (703) 518-1363n Errors and Omissions InsuranceSolid E&O protection built around yourunique needs. (800) 742-6900 Ext. 382n Penn National Insurance Agent’sUmbrella ProgramComprehensive and affordable excessinsurance protection includes E&O andBusiness Liability coverage with availableendorsements for EPL and Personal Cov-erage. Call your local PIA affiliate or (800)742-6900 Ext. 382n Catastrophe Major MedicalThe $2,000,000 Catastrophe Major MedicalInsurance Plan picks up where your basiccoverage leaves off! (800) 503-9230;https://www.personal-plans.com/pian GE Auto Warranty ServicesMarket a proven vehicle service contract pro-gram to auto dealerships. (800) 782-9753.n PIA HealthQuality health insurance for you, youremployees and families through a top insur-er in your area. Coverage and product avail-ability vary by state. (800) 742-6900 Ext. 382

n Hartford Flood InsuranceEasy enrollment process, competitive com-missions, advanced Internet services, plus avariety of programs and surplus lines. Call(888) 410-2963 x73932 or visithttp://www.trumbull-services.com/flood-pia/n Unimerica ProductsBasic, Voluntary and Dependent Term Life;Long Term Disability; Short Term Disability;ADD; Hospital Indemnity (800) 336-4759;www.piatrust.com

Financial Servicesn Bank of America Financial ProductsTell the BoA operator you are a member ofthe “National Association of ProfessionalInsurance Agents.” Personal cards: (800)932-2775. Business cards: (800) 598-8791.Gold Option Loan Program: (888) 332-5233.CDs: (800) 900-6653.

“PIA Plus” Products/Discountsn On-Line CE and Skills CoursesAvailable to agents in participating statesat www.PIANET.com/Education For othereducational programming, including designation programs, please contactyour local PIA affiliate.n Alamo Car RentalGet unlimited mileage and up to 20% offalready low retail rates. 1-800-GO-ALAMO(1-800-462-5266) (I.D. # 93140)n Central Licensing BureauSave time and money by using CLB for allyour agency licensing needs. (501) 664-8044

n Consumer BrochuresAnswer clients’ questions with professionalbrochures from PIA. (703) 518-1353.n Expedia Business AdvantageFree, award-winning online booking toolfor business travel. 1% rebate on all travel purchases. www.expediabusinessadvantage.com/PIAn Mines Press Calendar ProductsPersonalized calendars at member onlyprices. (800) 447-6788n Omnia Employee ProfilingSkills and personality testing. Contact Sean Neumeyer at (800) 525-7117 Ext. 1242.n Online Data Backup & RecoveryBackup critical files to a secure, remotelocation through Courtesy Computers, the insurance agency specialists.www.pianet.com/courtesyn Rough Notes Agency OnLineHelps identify risk exposures and providesdetailed coverage analysis. Avail. to PIAmembers for $400 annually (reg. $1,699). Call 800-428-4384. Use your PIA member ID#above name on mailing label.n Sircon’s Producer WorkbenchMeet your licensing and renewal needsquickly and easily on the web. PIA member-only 15% discount. Visit www.PIANET.com/PIAMainStreetStore/piaplus/Sirconn United Parcel ServiceReceive reduced rates on many popularovernight and 2nd day air shippingoptions. Call (800) 325-7000 or your localUPS representative and mention “BidCode #CP990007896.”

Visit the PIA Main Street Store at www.PIANET.comor use the information below to act now.af

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PRSRT STANDARDU.S POSTAGE

PAIDPERMIT #593

MERRIFIELD, VA400 N. Washington StreetAlexandria, VA 22314

Underwritten by: The United States Life Insurance Company in the City of New York, A member company of American International Group, Inc.

3175003 27394 (1/06)©Seabury & Smith, Inc. 2006 AG3612

1-800-503-9230

A PIA member-only benefit!

A plan that takes shape.

When your basic health insurance reaches itslimits, the PIA-endorsed Catastrophe Major

Medical Insurance Plan takes over. Features of thisPlan include:

• Convalescent Home• Home Health Care Benefits• Private Duty Nursing Benefits• Hospice Care

Look for this endorsed Plan for the additional protection you’ll want to have…so you won’t be left alone with all those bills.

For more information (including costs, exclusions, limitations and terms of coverage), visit www.personal-plans.com/pia or call the PIA Insurance Administrator:

Coverage may vary and is not available in the following states:AZ, MA, NJ, OR, WA, VT; or Puerto Rico.