Weekly Dispatch: Oct. 27, 2022

October 27, 2022


DOL proposal updates independent contractors’ classification

The U.S. Department of Labor proposed an update to the classification of independent contractors under the Fair Labor Standards Act, which would undo the updates made by the previous presidential administration. The proposal would rebalance the “economics realities test“ by making each factor (to determine if a worker is an independent contractor for purposes of the FLSA) equal. Currently, the degree of employer’s control and the worker’s opportunity for profit carry more weight than the other factors. The current standard went into effect March 8, 2021. Rather than changing the standard altogether, the proposal would effectively undo the changes made in 2021 and codify a test developed through decades of case law. Currently, the DOL is accepting public comments on the proposal through Monday, Nov. 28, 2022.

NAIC report: Premiums grew 61% as cyberthreats rose

The National Association of Insurance Commissioners released its Cyber Insurance report, which utilized data found within the Cyber Supplement, as well as alien surplus-lines data collected through the NAIC’s International Insurance Department. The 2021 data shows a cyber security insurance market of roughly $6.5 billion—reflecting an increase of 61% from the prior year. Insurers writing standalone cybersecurity insurance products reported approximately $4.5 billion in direct written premiums, and those writing cybersecurity insurance as part of a package policy reported roughly $2 billion in direct written premiums. U.S. domiciled insurers wrote $4.8 billion in direct written premiums, while alien surplus-lines insurers wrote $1.7 billion in direct written premiums. The growing threat of cyberattacks only punctuates the need for cyber liability insurance. If you need to purchase this insurance for your agency, PIA Northeast offers a product that can help you.

Updated building codes make a difference in Florida

According to research conducted by professors at a State University of New York and CoreLogic, updating Florida’s building codes has made a difference in reducing property losses after severe weather. When looking at the damage caused by Hurricane Ian, the researchers found that houses built within the last few building-code cycles held up better than the earlier-built houses in the same areas.

PIA, AIMS Society announce consolidation

PIA National and the American Insurance Marketing and Sales Society have announced they will combine entities to redefine the future of insurance education. The coming together of these organizations—each with a deep history of providing top-flight education programming for independent insurance agents—will benefit both independent agents and the whole insurance industry. A formal agreement was signed by both organizations and has been approved by their members.

Connecticut offers $46.6M to support small-business growth

Gov. Ned Lamont announced that his administration is making a five-year, $46.6 million investment to expand small-business assistance programs across Connecticut. The investment will be provided through grants to local nonprofit economic development organizations that provide a wide array of assistance to support the formation, growth, and innovation of small businesses. One of the main goals of this initiative, which is being administered by the Connecticut Department of Economic and Community Development, is to support underserved businesses. At least 50% of the financial assistance will fund minority-, woman-, disabled-, and veteran-owned companies, as well as those in distressed municipalities. Another goal is to support startups in the state.

Payroll tax cut 30% for New Hampshire businesses

Gov. Chris Sununu announced that payroll taxes will be cut 30% for New Hampshire businesses as a response to New Hampshire’s strong unemployment trust fund. Despite an unprecedented surge in benefit payments provided during 2020 and 2021, New Hampshire’s unemployment trust fund is above pre-pandemic levels and it is now back over $300 million. The fund is set to finish the third quarter with sufficient balances to trigger a 30% tax rate reduction for the average New Hampshire business. The tax rate reduction is triggered by state law when the fund maintains a balance of $250 million or more for an entire calendar quarter.

N.J.: Bill would require liability insurance for handguns

Legislation was introduced in the New Jersey Legislature this month that would require certain gunowners to carry liability insurance. The bill (A-4769/S-3214) would require any person in the state who carries a handgun in public to maintain liability insurance coverage. The policy must provide coverage for loss that result from liability imposed by law for bodily injury, death, and property damage sustained because a firearm was carried in public. The bill is scheduled for a vote today in the state Assembly, where it is expected to pass.

N.Y.: ‘Best interest’ amendments declared constitutional—end of the road for lawsuit

The New York State Court of Appeals ruled last week that amendments to Regulation 187, which created a suitability and best interest standard for the sale of life insurance and annuity products, were constitutional. This decision ends a legal battle that started in 2018. This case stemmed from the introduction of amendments to existing Regulation 187 titled “Suitability and Best Interests in Life Insurance and Annuity Transactions.” These amendments created an increased standard on insurance producers when selling life insurance products and required all recommendations be made in the best interests of the consumer without regard for producer compensation. The amendments went into effect Feb. 1, 2020, for life insurance transactions. The court found that the DFS did not cross the line into legislative policymaking.

Insurance professionals value the ever-changing industry at PIANY’s first-ever Capital RAP

PIANY’s first-ever Capital RAP was held Tuesday, at the Capital Center, Albany. Attendees learned from insurance industry leaders on how to navigate an ever-changing insurance landscape. Newly elected PIANY President David L. Sidle, CIC, CPIA, discussed the importance of building relationships, and retired Navy SEAL Darren McBurnett highlighted the untapped potential and never-quit drive that is the cornerstone of Navy SEAL success. He said: “The man who loves walking will walk farther than the man who loves the destination. When you love the journey, the goals just happen. Milestones, accolades, accomplishments are a side effect. When you fall in love with the journey, your purpose becomes more defined.” Additionally, PIA favorite instructor John Fear, CISR, CPIA, lead two education classes Applying Ethics & Diversity to Risk Assessment and E&O: Recommending At Least Full Coverage. PIANY also presented Edward Gentile III, CPRM, AINS, of Emery & Webb Inc., with its Distinguished Insurance Service award for his history of service to the American independent agency system and to PIANY. See photos from the event.


PIA: Proposed data call by FIO an unnecessary overreach

A proposed data call issued by the Federal Insurance Office is an unnecessary regulatory overreach, according to the PIA National. The FIO issued a Notice of Proposed Rulemaking to announce its plan to collect current and historical data from property/casualty insurers to assist FIO in its efforts to assess climate-related risk. The FIO says such data will help it anticipate potential disruptions in insurance coverage resulting from the effects of climate change. Throughout its history, the FIO has attempted in various ways to expand its limited congressional mandate. Since 2016, PIA has called on Congress to repeal the FIO to stop its continued usurpation of the state insurance regulatory system.


CID approves reduction in WC loss costs

The National Council on Compensation Insurance Inc. filed a workers’ compensation insurance application with the Connecticut Insurance Department for a -3% change in Voluntary Loss Costs and a 0% change in Assigned Risk Rates. The filing was approved as filed on Sept. 13, 2022, and it is effective Jan. 1, 2023.

Conn.: DMV adds more online transactions

Gov. Ned Lamont announced that the Connecticut Department of Motor Vehicles launched a new website for the state agency that streamlines all of the online services it offers in an effort to make completing transactions for customers easier, faster and more convenient. In the coming weeks, the DMV will add the ability for customers to conduct two more transactions online: requesting refunds when canceling vehicle or vessel registrations; and replacing lost titles. These new offerings will add to the DMV’s list of more than two dozen online services that have been added over the last several years—which include driver’s license renewals, vehicle and vessel registration renewals, updating addresses, and requesting driving records.

N.J.: Temporary disability and family leave insurance rates drop

The New Jersey Department of Labor and Workforce Development announced a reduction in worker and employer contribution rates to the state’s temporary disability insurance and family leave insurance programs for next year. Workers will see their contribution rates for temporary disability drop to 0%, from 0.14%, while the family leave rate will be cut by more than half—from 0.14% to 0.06%. In practical terms, workers will save an average of $56.25 in temporary disability contributions, and $55.25 in family leave contributions in 2023. Participating employers in the state will be moved to a lesser contribution table and will see a collective reduction of $20 million in their temporary disability contributions for fiscal year 2023. Employers do not contribute to the family leave program.

NYSIF program allows N.Y.-based companies to cover out-of-state employees for workers’ compensation

The New York State Insurance Fund announced that for the first time in its 108-year history it will extend coverage to out-of-state employees, which should help its policyholders simplify their benefits planning. The new program arises from 2021 legislation that permitted the NYSIF to provide workers’ compensation for its policyholders’ employees across the U.S. Under the initiative, any New York-based employer that has at least 50% of its workforce based in the state can offer its out-of-state employees NYSIF workers’ compensation coverage, and it will no longer have to incur the additional cost of procuring a policy from another insurer for out of state employees. New NYSIF customers with satellite offices or remote workers out of state also are eligible for the program.


PIA’s director of research honored by ACORD

PIA Northeast Director of Research Dan Corbin, CPCU, CIC, LUTC, received the Leadership Award from ACORD. This award was presented to Corbin for his leadership in Standards development, advocacy, and/or implementation. He was recognized for how he has helped to guide the insurance industry to share insurance data. Congratulations Dan!

Educating insurance agents

N.Y.: New classes that meet the New York State Department of Financial Services’ new CE requirements are available online and in private on-site sessions.

Conn./N.J./N.Y.: James K. Ruble Seminar, Nov. 2-3

Update your Certified Insurance Counselor designation with the James K. Ruble Seminar—available online or in-person (in New Jersey), which will be held Nov. 2-3, 2022. Lead by Patrick Deem Sr., CIC, CRIS; Jerry Kennedy, CIC; and Steven D. Lyon, CPCU, CIC, CRM, CRIS, AAI, ARM, AIS, MLIS, this course will discuss advanced and specialty topics, and offer a chance to build camaraderie among a network of CIC designees and Certified Risk Manager designees nationwide. This seminar has been submitted for continuing-education credits in Connecticut, New Jersey–Harrah’s Atlantic City or online, and New York.

Conn./N.J./N.Y.: Commercial Property Institute

Join Patrick Deem Sr., CIC, CRIS; Steven D. Lyon, CPCU, CIC, CRM, CRIS, AAI, ARM, AIS, MLIS, AFIS; and Robert Andrew Ward, CIC, CPIA, CWCA, as they lead the Commercial Property Institute, Nov. 16-17, 2022. At this institute, you will learn innovative ways to maximize coverage for various types of commercial property accounts. Sessions will cover topics, such as: forms and endorsements; causes of loss; and time element coverages. It has been approved for CE credits in Connecticut (16 PC), New Jersey (16 GEN) and New York (15 BR, C3, PA, PC).


N.Y.: Don’t forget: Next week, PIWA Fall Reception

Live and in-person! Don’t miss the opportunity to learn about your industry and network with peers and company representatives at the Professional Insurance Wholesalers Association of New York State Inc.’s Fall Reception. Additionally, you will have the chance to spend the evening with representatives from your New York wholesalers and hear what they have to say. It’s all happening Thursday, Nov. 3, 2022, at the Hard Rock Hotel NYC, from 5:30-7:30 p.m. Register now.

Register now

TONIGHT: Thursday, Oct. 27, 2022: CTYIP Fall Reception—register at the door

Thursday, Nov. 3, 2022: PIWA Fall Reception

Wednesday, Nov. 16, 2022: PIANJ Deep Dive on the Lifecycle of a Cyber Risk

Thursday, Nov. 29, 2022: NJYIP Holiday Social

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