Messenger COVID-19 SPECIAL EDITION - Independent Insurance Agents of Maryland
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MARYLAND
Messenger MAY/JUNE 2020
COVID-19
SPECIAL EDITION
WAY
REGISTRATION OPEN! BWI MARRIOTT
JULY 17
F R I D A Y
2 0 2 0
CONFERENCE AGENDA Kelly Donohue-Piro David Dillon
7:30-8:30 Registration Agency Performance Partners Watney Insights Network
8:30-10:00 Morning Session 1
5 New Agency Challenges & How To Tackle Them R E G I S T R A T I O N T Y P E S
Presented by: Kelly Donohue-Piro
F U L L D A Y R E G I S T R A T I O N
10:15-11:45 Morning Session II MEMBER ATTENDEE: $100
Mindset NON-MEMBER ATTENDEE: $125
Presented by: David Dillon
Full Day Registration Fee Includes:
12:00-1:30 Networking Lunch with Exhibitors Continental Breakfast
Morning/Afternoon Sessions + Session Breaks
Lunch with Exhibitors
1:45-3:15 Afternoon Session I Chairman's Cocktail Reception + Dinner
Eat That Frog! Casino Night
Presented by: David Dillon
N E T W O R K I N G R E G I S T R A T I O N
3:30-5:00 Afternoon Session 1I The networking pass is available to those who wish to
Designing & Tracking Your Customer Experience attend only the exhibit hall on Friday, July 17, 12:00
Presented by: Kelly Donohue-Piro pm-1:30pm. The price for the networking pass is $40
for both members and non-members.
5:30-6:30 Chairman's Cocktail Reception
Networking Registration Fee Includes:
Lunch with Exhibitors
6:30-8:00 Installation of Officers & Dinner
D I N N E R R E G I S T R A T I O N
8:00-9:30 Casino Night!
The price for the dinner pass is $100 for both members
and non-members.
Dinner Registration Fee Includes:
Chairman's Cocktail Reception
$ Installation of Officers + Dinner
SPONSOR OPPORTUNITIES EXHIBITOR OPPORTUNITIES
Visit www.BIGIMD.com/BIGIMDANNUAL to register!
In This Issue
4 Chairman’s Message
5 Navigating Through Uncharted Waters
7 Ask Pat
Big I Maryland
2408 Peppermill Drive, Suite A
9 What our Partners Carriers are Doing to Aid Insureds?
Glen Burnie, MD 21061 11 Maryland Insurance Administration Bulletin
(P) 410-766-0600 | (F) 410-766-0993 13 Worker's Compensation, COVID-19 and 3.A.
Editor: 16 Business Income Insurance
Rebekah Langford 21 Maryland Insurance Administration Advisory
Graphic Designer:
24 The Big "I" Maryland 2020 Legislative Session Summary
Maritza Dintino / ColorCraft Printing 30 Tidbits
EXECUTIVE COMMITTEE
32 Big "I" Legislative Conference
33 Markets
Chairman 37 Life Corner
Gerald Zoller, CPCU - Eldersburg
38 Does the PAP Cover Food Delivery?
Immediate Past Chairman 41 You're Suddenly Managing Remote Teams, Now What?
John Cabrera - Germantown
42 Education Corner
President 43 Additional COVID-19 Resources
Rebekah Langford, AAI - Glen Burnie
ADVERTISERS
State National Director
Angela Ripley, CIC - Columbia Big I Maryland would like to THANK all of our advertisers for
their continued support! The Maryland Messenger would not
Chairman-Elect be possible without them.
Jerry Nicklow, AAI - Pasadena
Berkshire Hathaway GUARD Insurance Companies
Potomac Insurance Network, Inc.
Vice Chairman
Preferred Property Program, Inc.
Ivory Buck, III - Easton
Builders Mutual
Insurance Brokers Service Corporation
Director-At-Large Chesapeake Employers Insurance Company
Christopher Weller - Huntingtown
The Maryland Messenger is a bi-monthly publication published
Past Chairman Representative for the exclusive use of regular and associate members of the
Angela Ferguson - Westminister Big I Maryland. Publication of any article, letter to the editor
or advertisement in the Maryland Messenger should not be
DIRECTORS deemed as an endorsement by Big I Maryland of the opinions
expressed or product advertised. Questions and comments
Stacey Nicholson, CIC, CPCU, LUTCF - Annapolis should be directed to the editor; Rebekah Langford.
Nancy Nicklow, CPCU -Pasadena
G. Bradford Reeves, AAI, AFIS - Chaptico Editorial Office
Enver Berker Hazar - Kensignton 2408 Peppermill Drive, Suite A
Glen Burnie, MD 21061
(P) 410-766-0600 | (F) 410-766-0993
Email: rebekah@BigIMD.com | www.BigIMD.com
Chairman’s
Message
Gerald "Gerry" Zoller
A Personal Note from your 2019-2020 Chairman
When this crisis first started, you we all should understand that change by increasing remote support for
probably found yourself searching for “is always there” or at the very least, marketing, claims, and underwriting.
knowledge and information to help “on the horizon”. The insurance companies continued
clients, employees, family, and friends. We may start our day with a plan, to keep lines of communication
Hopefully, you checked with your but that plan can all change with a open and responsive. Many put in
Association, Big I MD. Early on the claim, service question, or customer place easing of premium payment
staff was rapidly collecting and issue that needs immediate attention. guidelines and offers of refunds
posting valuable information for all New innovations in equipment, or credits on some personal lines
of our members as soon as it became software, or technical advances policies to help our customers.
available. I know firsthand that some across industries can test our ability When it seemed like their world
of our agency’s responses to the to adapt and forge new paths to serve was suddenly upside down, I found
tough questions were formulated our clients. insurance customers surprised
around what we had learned from that service did not diminish. Their
Along came the Coronavirus! Silent, needs and inquiries were answered
our Association’s Coronavirus invisible, deadly, and fast moving.
(COVID-19) resource page. If you as normal.
Our industry’s ability to continue
have not gone to our resource page servicing the needs of our clients As insurance professionals, we can
lately, I encourage you to do so as efficiently during a worldwide be proud that through the worst of
soon as you can. Big I MD assembles pandemic is a major challenge that times we remain up to the challenge.
and disseminates knowledge that we confronted head on with little Faced with adversity and potentially
makes all of us better insurance warning. I believe history will show disruptive change, we answer the
professionals. Rapid response and we did it not only rapidly, but we did call. The people that make up our
presentation of accurate educational it well. industry have a mindset of helping
information are the hallmarks of the customer no matter what it takes.
what we do. Your membership In speaking with a number of
member agencies in the last few I thank each and every one of you,
and participation in Big I MD is an especially our Association staff who
important part of that mission! weeks, I found many examples of how
innovation and rapid deployment of make sure you are equipped and
Resilience agency resources almost completely informed during challenging times
I have often mentioned that change realigned how business was being so we can deliver our best when
is a fundamental part of our industry. done. A number of agencies customers need us most.
From anyone just entering the established work from home for Stay safe.
insurance industry to veterans with the majority, if not all of their staff.
years of experience in our business, Insurance companies joined the effort
Maryland Messenger 2020 MAY/JUN 4
Navigating Through Uncharted Waters: COVID-19 and Health Insurance By Al Redmer, Jr. Maryland Insurance Commissioner The COVID-19 State of Emergency is a industry leaders want to do the right to encourage social distancing. now constant reminder that we never thing – mainly because they’re good • Prior authorizations: The fully know what’s around the corner in citizens, but also because it’s good majority of carriers have relaxed life, even as we try to plan for a stable business in a competitive environment. some of their prior authorization future for ourselves and our families. In Since the COVID-19 crisis began, we’ve requirements. Several are waiving times like these, insurance becomes a held five conference calls with health prior authorizations for non-elective major concern. insurers active in Maryland to talk hospital admissions and some The Maryland Insurance about the challenges consumers and are waiving concurrent review Administration’s goal is to provide companies are facing as we navigate for hospitalizations, and some efficient, effective service to both the these unprecedented times. I’ve been will honor previously approved consumers of insurance products very impressed by the actions taken so authorizations for elective surgeries and the insurance industry. Our far by insurers to help their customers. that need to be rescheduled. most important job is assuring the In many cases, one insurer will show • Premium payment and fair treatment of consumers, with all leadership or innovation in a particular employer coverage issues: carriers following Maryland law. When area and others will follow the lead. Most carriers have indicated we go through a crisis like COVID-19, For example: they will work with consumers our agency’s role as a regulator is a • Telehealth expansion: Carriers to accommodate difficulties with critical part of the state’s response. have expanded access to telehealth premium payments. One carrier Regulation can often sound scary, across the board. All major carriers has officially announced it will defer conjuring up images of an adversarial, have started waiving cost-sharing premium for up to two months “big stick” approach. To be sure, we for many in-network non-COVID-19 with no interest or penalty upon sometimes need to enforce the law telehealth visits, and several customer request. Many carriers with serious penalties for violators. are waiving in-network and out- are working with employers At the direction of Governor Hogan, of-network cost-sharing for all directly on a case-by-case basis to we’ve also taken some strong telehealth visits, including many accommodate specific requests to emergency actions in response to specialties. Many are covering ensure continuity of coverage for COVID-19, including requiring carriers phone-only consultations in certain laid off employees. to waive any time restrictions on situations. Several are ensuring that “We’ll get through this, together” is prescription medication refills and reimbursements for telehealth are a common theme throughout the authorize payment to pharmacies the same as in-person visits. country and world these days. We’re for at least a 30-day supply of any • Treatment of COVID-19: Most putting that into practice at the prescription medication. carriers are waiving cost-sharing for Maryland Insurance Administration But, overall, I’m a strong believer in all COVID-19 treatment (this includes by taking an inclusive, collaborative collaboration, of working together out-of-network services for some of approach. We’re regulating, we’re to find solutions. When it comes to a the carriers). listening, and we will continue to crisis, we want to help insurers help • Prescription drugs: Several advocate for Maryland citizens and consumers. It’s been my experience carriers are offering free home businesses. that the vast majority of insurance delivery of prescription medications Maryland Messenger 2020 MAY/JUN 5
Big “I” Professional Liability Program
Risk Management Reference Guide
The Big “I” Professional Liability program believes that risk management is key in not only preven�ng errors, but also in
providing agencies with tools to more efficiently service their customers. All policyholders of the Swiss Re Corporate
Solu�ons/IIABA professional liability program have exclusive access to the risk management informa�on developed from our
more than �0 years of experience insuring agencies. As a reminder, �estport Insurance Corpora�on is a member of Swiss Re
Corporate Solu�ons. These risk management resources are exclusively available to your agency as a valued policyholder of the
Swiss Re Corporate Solu�ons/member of IIABA.
Big “I” Risk Management Website – E&O Happens Agency E&O Seminar
This website contains comprehensive informa�on and tools such Administered by IIABA state associa�ons, E&O seminars are an
as an overview of common mistakes that cause E&O claims; real- excellent way to increase procedural and knowledge-based E&O
life case studies for learning; best prac�ce �ps; sample disclaimers, risk management awareness to agency personnel. Agencies with
procedures and client le�ers; opera�onal self-assessments; E&O- the requisite number of staff a�ending may qualify for a 10%
related ar�cles, and more. Visit www.iiaba.net/EOhappens to log premium credit and may also qualify for CE credits, providing a
in. (FREE) double benefit. (Fee-based)
Big “I’ Virtual Risk Consultant Powered by Rough Notes (VRC) Agency Opera�onal Improvement Review
The VRC is a web-based resource providing comprehensive tools A review of your agency opera�ons is available. Voluntary comple-
such as industry specific client risk exposure checklists and �on of this review may qualify you for a 10% E&O premium credit
ques�onnaires. VRC helps agents to be�er understand the good for five years on the next renewal. (Fee-based)
coverage needs of customers and avoid E&O claims from failing to
offer proper coverage and failing to iden�fy customer exposure. Big “I” Virtual University
Visit www.iiaba.net/VRC to learn more. (Fee-based) VU is a web site with informa�on on hundreds of insurance
related business and technology ar�cles, sample ISO forms, white
E&O Claims Advisor Newsle�er papers and informa�on affec�ng today�s insurance marketplace.
Published monthly and emailed to agency staff, this newsle�er It also provides a forum to answer ques�ons that can�t otherwise
provides valuable informa�on on agency E&O trends and hot be found in the research library through the “Ask an Expert”
topics. (FREE) service. Visit www.iiaba.net/VU. (Free)
Risk Management Webinars Big “I” Agents Council for Technology (ACT)
These quarterly webinars address emerging E&O risk management ACT brings agents, carriers, vendors, user groups and industry
topics. Less than an hour in length and perfect for all agency staff, associa�ons together in an effort to employ the best workflows
the webinars include detailed discussion from industry leaders on and technologies available within the independent agency system
reducing exposure to E&O claims. (FREE) in order to improve our compe��ve edge. Please visit the ACT
website at www.iiaba.net/ACT and watch the short video briefing
on the site to get a good overview of the high-quality informa�on
that we make available to agents and carriers. (Free)
Should you have any ques�ons, please contact your state associa�on or �im �anley at �im.hanley�iiaba.net. �e appreciate your
con�nued support of the Big “I” Professional Liability Program and Swiss Re Corporate Solu�ons and hope you find these risk
management resources useful in helping your agency avoid E&O claims.
Maryland Messenger 2020 MAY/JUN 6
Ask Pat Patricia McHugh Lambert
Pesin Katz Law, P.A.
901 Dulaney Valley Road, Suite 400
Towson, Maryland 21204
410.938.8800 • 410.339.6759 (direct)
410.832.5628 (fax) • plambert@pklaw.com
Leadership in Times of Crisis
I have been thinking a lot about remotely produced show, the wheat from the chaff, a
how a crisis can make or break a change happens in a crisis and process that needs to start
leader. Abraham Lincoln’s legacy can produce effective results. before a crisis.
was based upon how he handled Of course, change must be 3. Leaders need to have access
the crisis of the Civil War. Stephanie monitored. For example, the to the right people. In a crisis,
Rawlings-Blake received harsh Maryland Judiciary originally it is important to know the
criticism due to her handling of the used Zoom for arguments, right people. For example,
2015 Baltimore riots. Dr. Anthony but when issues arose with those individuals with a solid
Fauci has, at least as the writing of Zoom, other platforms were relationship with a bank had
this article, received great praise explored. Leadership requires an easier time applying for
due to his calm and straight forward comfort with change, regardless money from the stimulus
approach to providing information of whether there is a crisis. package. Those of us in the
and leadership relating to the This crisis has reminded me to legal field who had access to
COVID-19 crisis. This COVID-19 crisis embrace change. bar and judicial leadership
should cause all of us who consider 2. Leaders must understand that could ask questions about the
ourselves to be leaders to think. trustworthy information is operation of the courts and the
Crisis in the time of leadership is essential. There have been so future of litigation. Insurance
difficult. There is often less time, many rumors, half-truths and professionals who belong to a
less people and less resources outright lies that have infected strong association can obtain
during a crisis. But every true the ether of social media and and share needed information.
leader learns something from newsfeeds during this crisis. Leaders need to develop such
a crisis—something that can be Leaders, however, must have access so that they can ask the
used in more ‘normal’ times. In credible information to rely on right people the right questions.
this article, I want to let you know in order to make decisions. I 4. Leaders need to seek out
a few things that I have learned— have been particularly aware their peers and ask for help.
or relearned-- during this current that I need reliable information Sometimes we, as leaders, feel
health crisis. in order to make decisions, like we stand alone when we
1. Leaders must expect that we particularly to get a sense of make a decision. We feel like
will not be doing things the what is going on in my industry we are the only ones that have
same way. During this crisis, and the financial lay of the faced certain challenges, when
I have been impressed at how land. I read news feed from in actuality other peers have
leaders have approached the credible accountants, attorneys, faced similar challenges. The
issue of needed change. From government officials and news information and insight that
Governor Hogan’s emergency resources. I try to add my own these peers can provide can be
order allowing, for example, credible voice to issues when invaluable. Leaders have peers
the remote witnessing of I feel that I need to speak. The
wills to Saturday Night Live’s key is knowing how to separate
(Con’t on page 8)
Maryland Messenger 2020 MAY/JUN 7
(Con’t from page 7) I will be completely offline. I Oath, the oath that doctors
have updated documents, like take that is “first, do no harm.”
wills, healthcare directives and The leader’s oath, however,
they can call upon, even if their
powers of attorney—something should be “First, try to do no
peers are competitors. During
that I have been putting off for harm.” Trying to do no harm,
this COVID-19 crisis, I have
some time. I have also tried to of course, requires recognition
received so much assistance
be a better boss by reaching out as to how harm can occur. I
from other leaders who have
more—making sure that I talk to have seen so many businesses
helped me with the struggles
people by phone, FaceTime or making decisions during this
that I have faced. The value of
by virtual connection. Leaders, crisis that are contrary to the
sharing troubles is something
even busy leaders, must think law and executive orders. I
that we all need. We just
about how often they respond have seen businesses making
sometimes need to put aside
by a terse email—and how that decisions that do not respect
our pride and ask for assistance
impacts people. Our people are privacy. I have seen knee jerk
and advice.
our most valuable resource and decisions made that simply
5. Leaders need to be transparent we should treat them as such— lacked thought. This crisis, more
and decisive when making a crisis or no crisis. Pick up the than anything, demonstrates
tough decision. During this phone and talk! And take a little that decisions—whether a
COVID-19 crisis, I have not time for yourself! decision to act or a decision not
envied the hard decisions to act—can lead to devastating
7. Leaders think about who is
that Governor Hogan and consequences. Leaders
important to their business.
our local leaders have had to understand this.
During a crisis, it is hard to stay
make. As our state faced an
in touch with the all the people 9. Leaders think about the
unprecedented public health
who are important. When changes that need to be made.
crisis, decisions had to be made
we deal with our own issues, A time of crisis demonstrates
about medical equipment,
the issues of our employees, flaws in an organization. Some
school, unemployment
and whatever financial or of the flaws are large. Some
assistance and real life-
operational crisis we are small. All need to be dealt with
and-death decisions. These
having, there is little time for and changed. When this crisis
Maryland leaders have been
anything else. But we must is over, many are going to try
both decisive and transparent
remember who is important to to get back to an old normal.
with their decisions and
our business. For me, it is my The true leaders will embrace
have been willing to answer
clients. During this COVID-19 the flaws and encourage the
questions as to the how and
scare, I have had to think about changes they inspired.
why they made hard decisions.
how I deal with my clients and 10. Leaders understand that there
I have watched leaders in my
prospects. So, this has reminded will be the next crisis. As we
own business explain difficult
me to understand who my best live through this crisis, we
decisions. Again, the crisis
15 to 20 contacts are and to should recognize that there will
has reminded me that we, as
keep up those relationships. I always be another crisis. We will
leaders, are not called upon to
am trying to strengthen my not know what that crisis is, but
do the easy; we are called upon
outreach to my networks and to we will be called upon to deal
to do the hard.
professional relationships. What with it.
6. Leaders need to know that I have found is that many people
they need to take care of are hungry for contact—they All of this is hard and will continue to
themselves and their people want someone to reach out to be hard for a time to come. When
first. During this pandemic, them. And this is something this crisis nears conclusion, we will all
I have been recovering from that I will remember when this need to take a breath and think about
surgery—good timing I know. crisis is over. how we can become better leaders.
But it has reminded me that I
8. Leaders understand that
am not effective unless I have
things can get worse. I think
my strength and my health.
that all leaders should take
So, I have set myself limits as
a version of the Hippocratic
to when I will work and when
Maryland Messenger 2020 MAY/JUN 8
What our Partners
Carriers are Doing to
Aid Insureds During
the Pandemic?
By Shelley Arnold, CPCU, AU, ARM, AAI, ACSR, AIS
One thing for certain, the Coronavirus this challenging time is simply the supply deliveries. See Maryland
has cleared the congested roads right thing to do. Bulletin 20-15 (https://insurance.
throughout Maryland. Highways and Insurers are also helping through maryland.gov/Insurer/Documents/
byways are empty. This has led many other relief programs. After multiple bulletins/20-15-Commercial-Use-
insurers to announce a discount or Bulletins (https://insurance. Exclusion-in-PPA-policies.pdf)
rebate, if you would, to drivers. The maryland.gov/Insurer/Documents/ At least one carrier, Travelers,
‘stay at home’ order declared by bulletins/20-10-Cancellation-of- is accelerating more than $100
Governor Hogan, means less cars on insurance-policies-during-covid- million in commission payments to
the streets and highways, resulting in 19-SOE.pdf) and 20-17 (https:// eligible agents and brokers and has
less accidents. insurance.maryland.gov/Insurer/ pledged $5 million to assist families
According to CNA Business, the Documents/bulletins/20-17- and communities affected by the
top 10 insurers, who write 72% of COVID-19-Contractual-Deadlines- COVID-19 pandemic across North
the market, will be participating in within-Propery-and-Casualty- America, the United Kingdom and the
refunds. The refunds vary, not only Insurance-Policies.pdf, issued by Republic of Ireland.
in amounts, but also the amount of Commissioner Alfred Redmer, “As so many are facing a significant
time that will be covered to determine Jr., and the Maryland Insurance financial burden due to the COVID-19
the refund. For example, State Farm Administration urging companies pandemic, we want to show our
announced it will be providing a 25% to assist through accommodations agent and broker partners, many of
discount covering a 10 week period. such as grace periods, suspensions whom are small business owners,
The majority of the carriers taking of premiums due, extension of billing our support at this challenging time,”
similar actions are using the April-May due dates, waiver of installment said Alan Schnitzer, Chairman and
period. The percentage of the rebate and late payment fees and taking Chief Executive Officer of Travelers.
varies. Travelers (15%), Allstate (15%), steps to avoid cancellations due to “Independent agents and brokers not
the Hartford (15%), Progressive (20%), nonpayment. They also urge that only provide invaluable counsel and
Liberty Mutual (15%), Cincinnati (15%) policyholders use all of the electronic care to our customers but also play
and Safeco (15%) are some carriers means available to make payments, a critical role in the U.S. economy,
providing premium relief. etc. Bulletin 20-17 also gives guidance and we are committed to standing by
One carrier, Erie, is taking a different with respect to contractual conditions them.”
approach to assist their insureds. such as sworn statements, time to
make necessary repairs, etc. To FEMA has issued bulletin (https://
Erie has filed a rate reduction for www.nfipservices.floodsmart.
both personal and commercial. date, the MIA has issued eight (8)
Bulletins directly related to COVID-19. gov/sites/default/files/ w20002.
This will assist throughout the year, pdf) extending the grace period for
not just two months. According to Patricia McHugh Lambert provides an
excellent overview on page 11. payment of NFIP premiums due
Erie Insurance President and CEO to COVID-19. For policies with the
Tim NeCastro, while ERIE’s pricing Many carriers are also providing expiration between February 13th,
philosophy has always centered coverage for insureds whose job 2020 and June 15th, 2020, FEMA has
around providing exceptional responsibilities now include using extended the grace period for receipt
protection and service at the lowest their personal automobile to make
possible cost, lowering rates during food, grocery, pharmacy and medical
(Con’t on page 10)
Maryland Messenger 2020 MAY/JUN 9
(Con’t from page 9) loss due to COVID-19 could recover see the hazards of the passage of
those losses from the insurer. It these bills and the impact this will
would be retroactive for any insureds have on the industry. Paying for
of renewal premium payments from
with business interruption policies in claims where no premium has been
30 to 120 days. This extension allows
place from March 9, 2020 (the date of collected could potentially bankrupt a
customers additional time to pay their
the declared public health emergency carrier and could make it impossible
flood premiums to avoid any lapse or
by NJ Governor Phil Murphy. It would to pay claims where premium has
reduction in flood coverage.
apply to any business with less been collected. The Massachusetts
One evolving and volatile issue than 100 employees. Other states Governor even stated that he felt the
in commercial lines is whether that have followed New Jersey are insurance companies should pay. It is
the Business Interruption policy/ Massachusetts with the introduction quite apparent that most legislators
coverage will respond. New Jersey is of SD.2888 and Ohio HB589. Both do not understand the insurance
attempting to legislate that business Massachusetts and Ohio’s bills are mechanism.
income coverage respond even if the almost identical with a March 9 or 10 This issue continues to make
form contains the 'virus exclusion'. retro date, but with Massachusetts headlines. Stay tuned and stay
Bill A3844 (https://www.njleg. bill applying to businesses with 150 informed.
state.nj.us/2020/Bills/A4000/3844_ or less employees. At the time this
I1.HTM) would alter the specific article was written, none had passed. The Big I appreciate the measures
exclusion contained in the business being taken by our carrier partners.
The states are already seeing a jump
interruption form for viruses. It
in litigation in this area. Hopefully,
provides that businesses that
the legislatures of the states will
experience a business interruption
Preferred Property Program can help you procure Umbrella
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Maryland Messenger 2020 MAY/JUN 10Maryland Insurance
Administration
Bulletin Related to
COVID-19 Crisis
By Patricia McHugh Lambert
There is so much being written insurance.maryland.gov/Insurer/ reasonable accommodations may
about the legal issues surrounding Documents/bulletins/20-17-COVID- include suspensions of premiums
the pandemic that it is hard to know 19-Contractual-Deadlines-within- due, extension of billing due dates
where to begin reading. Today, we Propery-and-Casualty-Insurance- and premiums grace periods, and
are providing information related Policies.pdf. waiver of installment and late
to Bulletins issued by the Maryland Bulletin No. 20-16 deals with payment fees. Bulletin No. 20-
Insurance Administration (“MIA”) title insurance producers. This 14 applies to Maryland-domiciled
concerning the COVID-19 Pandemic. bulletin specifically allows title insurers and deals with waiver of
Bulletin No. 20-17 deals with insurance producers to conduct the Statutory Accounting Principle
contractual deadlines within remote settlements during the that requires an insurer to non-
insurance policies. The MIA has COVID-19 crisis, provided that admit premium receivable assets
specifically requested insurers to certain protocols are followed. over 90 days past due. https://
“be lenient” in the application of the The protocols are specified in insurance.maryland.gov/Insurer/
policy language requiring “notice the bulletin. https://insurance. Documents/bulletins/20-10-
of a claim promptly.” Insurers are maryland.gov/Insurer/Documents/ Cancellation-of-insurance-policies-
specifically requested to consider bulletins/20-16-Conducting-Mobile- during-covid-19-SOE.pdf; https://
“whether or not late notice of a Settlements.pdf. insurance.maryland.gov/Insurer/
claim was preventable and if the Documents/bulletins/20-14-
Bulletin No. 20-15 deals with certain Premium-Receivables-over-90-days-
late-notice actually prejudiced private passenger automobile
the insurer’s ability to adjust the during-COVID-19-SOE.pdf
insurers suspending the commercial
claim.” Similarly, insurers are use exclusionary language in their Bulletin No. 20-13 concerns the
requested to consider limiting contracts during the COVID-19 crisis. temporary suspension of the
the use of “Sworn Statement in The bulletin explains how insurers 45-day advance mailing notice
Proof of Loss” and to consider may make an endorsement form of cancellation, non-renewal or
the use of electronic signatures. filing that temporarily suspends premium increase for private
The MIA has further reminded the commercial use exclusionary passenger automobile liability
insurers that policyholders should language in their contracts. https:// insurance for the duration of
not be penalized for delays that insurance.maryland.gov/Insurer/ the state of emergency. Specific
might be caused by the COVID-19 Documents/bulletins/20-15- information is provided as to what
crisis, particularly in considering Commercial-Use-Exclusion-in-PPA- efforts insurers should make and
the policy benefits for additional policies.pdf. the extended timing for protests.
living expenses, loss of use, rental https://insurance.maryland.gov/
reimbursement, and business Bulletin Nos. 20-10 and 20-14 deals Insurer/Documents/bulletins/20-13-
interruption claim. For EUOs, with premiums. In Bulletin No. 20- Temporary-Suspension-of-45-day-
insurers are forbidden to take in 10, the MIA strongly encouraged Advance-Mailing-Notice-PPA.pdf
person examinations without the insurers to make reasonable
accommodations so that individuals Bulletin No 20-09 concerns
agreement of all parties; even with what insurers offering travel
the agreement of all parties, there and businesses do not lose coverage
due to non-payment of premium insurance policies offer during the
must be strict adherence to all
social distancing protocols. https:// during the COVID-19 emergency.
The MIA specifically noted that (Con’t on page 12)
Maryland Messenger 2020 MAY/JUN 11administrative offices. https:// specific exclusions for loss or
(Con’t from page 11)
insurance.maryland.gov/Insurer/ damage caused by war, nuclear
Documents/bulletins/20-18-COVID- action and radiation. The potential
COVID-19 crisis. https://insurance. 19-Motor-Vehicle-Registrations.pdf loss costs from such perils are so
maryland.gov/Insurer/Documents/ extreme that providing coverage
Bulletin No. 20-20 deals with the
bulletins/20-09-Travel-Insurance- would jeopardize the financial
financial challenges of Maryland’s
sales-during-COVID-19-SOE.pdf solvency of property insurers.
business community and what
Information regarding COVID-19 insurers should do to assist. With Global pandemics like COVID-19
provider frequently asked respect to workers compensation usually fall into this category.
questions can be found at https:// policies, insurers are requested However, policies can be different.
insurance.maryland.gov/Providers/ to work with producers to We recommend that businesses
Documents/COVID-19-Providers- accommodate policyholder requests review their policies and reach out
FAQs.pdf. Information regarding for mid-term revisions to premiums to their insurance professionals with
frequently asked question on based upon COVID-19 furloughs and any questions.” https://insurance.
producer licensing can be found layoffs. This Bulletin also requests maryland.gov/Pages/newscenter/
at https://insurance.maryland. that insurers waive or reduce “to NewsDetails.aspx?NR=2020256
gov/Documents/newscenter/MIA- the greatest extent possible” short- We expect additional bulletins and
Producer-Licensing-COVID-FAQ.pdf. rate cancellation penalties during information to be issued during the
Bulletin No. 20-18 deals with the COVID-19 crisis. Insurers that upcoming weeks.
Motor Vehicle Registrations and use credit in underwriting are also Other Information: There is a
Commercial Automobiles and Fleets. urged to take into consideration the COVID-19 resource page that has
The Bulletin notes that owners impact of the crisis; insurers are important information, including:
of multiple vehicles, including specifically urged to “rely heavily”
on pre-COVID-19 information and to • Contract information for
commercial fleets, may want to
consider an insured’s or applicant’s key Maryland Insurance
put some vehicles out of service
history over a period “of several Administration personnel.
during the COVID-19 crisis, so
as to discontinue coverage and years”. Commercial insurers are • Responses to frequently asked
thereby reduce premiums. The also urged “to refrain from attaching questions, including questions
Maryland Insurance Administration any adverse underwriting or pricing relating to extended filing
encourages insurers to work with outcomes for insureds who have deadlines, the waiver of the
policy holders to make premium made inquiries or file Business requirement of “wet” signatures
reductions without the return of Interruption claims that have for filings, and the fact that
tags. This reduction of premium not resulted in a claim payment.” there is no change in the service
issue has been the subject of a https://insurance.maryland.gov/ procedures for litigation filings
number of Bulletins and insurers Insurer/Documents/bulletins/20-20- against insurance companies.
should consider having a plan in Commercial-Insurance-COVID-19.pdf https://insurance.maryland.gov/
place to deal with such issues. The MIA has also issued an advisory COVID-19/Documents/EandA-
https://insurance.maryland.gov/ on business interruption insurance. COVID-FAQs.pdf
Insurer/Documents/bulletins/20- As stated in this advisory, “Some Please feel free to contact us, your
18-COVID-19-Motor-Vehicle- commercial policies provide association, or the author of this
Registrations.pdf Business Interruption coverage article regarding these Bulletins or
Bulletin No. 20-19 deals with when a business is shut down due their implementation.
quarterly premium tax payments. to an Order by a civil authority.
Ms. Lambert can be reached by phone
The bottom line of this bulletin is However, the policy still typically
at 410-339-6759 or email plambert@
that the Insurance Commissioner requires a physical loss from a
pklaw.com.
has the discretion to waive penalties covered peril as the underlying
and late payments of quarterly cause of the business shut down to
estimated premium taxes due on apply. All insurance policies have
April 15, 2020. Importantly, an exclusions of coverage for risks that
insurer should have documentation are too great to be underwritten at
as to how the COVID-19 crisis an affordable price. For example,
has impacted the operation commercial and personal property
of the insurer’s premium tax insurance policies typically contain
Maryland Messenger 2020 MAY/JUN 12Worker's
Compensation,
COVID-19 and 3.A.
By Chris Boggs, CPCU, ARM, ALCM, LPCS, AAI, APA,
CWCA, CRIS, AINS
Workers' compensation is regulated a 3.A. primary state. If the employee simply lives across the
at the state level. Although there are Does this same focused guideline state line and travels to the employer's
some benefits to this, there are also apply to employers located near location, there are no operations in
problems created. state lines if employees live in a the other state (the state of residency).
Because work comp is state based, neighboring state and travel across Because the employees are or may
the policy responds only when a state state lines to get to work? Yes, as soon be quarantined in their homes,
is specifically listed as either a 3.A. per the Coming and Going Rule. there are now operations in another
(primary) state or granted protection Traditionally the coming and going state – specifically the employee's
as a 3.C. (secondary) state, which may rule holds that injuries suffered state of residency. Whether the
or may not require a specific listing traveling to or home from work, or employee's home state needs to be
depending on the insurance carrier. even while going to and returning listed as a 3.A. state is a function of
from lunch, are not compensable. permanency and the extraterritoriality
Primary or 3.A. status is required when: and reciprocity provisions of the
The logic behind the rule is that
• Gaps exist between the the employee is not furthering the states in question (the employer's
extraterritorial provisions of the employer's interest or serving the operational state and the employee's
home state and the reciprocity business' need while travelling to state of residency).
allowances of the state to which or home from work; the employee If the employee likes working from
the employee travels to work is serving his or her own needs (the home and the employer sees no drop
temporarily; or need to have a job and earn a living). in quality and quantity of work (maybe
• There are on-going (not temporary) Because of the coming and going even an increase in both), working
operations in a state. rule, even when a location-specific from home may become permanent.
employee lives in another state, the If these home-based “operations"
Deciding which state or states
state of residency is not required become permanent, the employee's
require(s) listing as a 3.A. state is
to be listed as a 3.A. state. The state of residence should or must be a
easy when the employees are based
employees are assigned to the 3.A. state.
in a single location – such as an
office building or service location. operational location. But if the situation is only temporary
At least it used to be - COVID-19 has COVID-19 Complications and will never be anything but
complicated the issue. temporary, should the employee's
COVID-19 may have complicated the state of residence be listed as a
Single Location Employees issue and even negated the idea of 3.A. state during the temporary
When employees work at a single the coming and going rule. Historically relocation? The answer depends on
location such as an office building, the “Coming and Going Rule" has the application of the involved state's
service location or a manufacturing allowed employers to “ignore" an extraterritoriality and reciprocity
plant, 3.A. assignment is easy. employee's state of residence, but provisions. Basically, the answer is
Regardless where the employees COVID-19 has pushed employees out complicated because state variations
live, only the state in which the of the employer's location and has must be considered.
operation(s) is/are located must be required them to set up operations
considered when extending status as in their home. Now the state of
residence may matter. (Con’t on page 14)
Maryland Messenger 2020 MAY/JUN 13(Con’t from page 13) regulations linked here: https:// Given these circumstances, it appears
www.independentagent.com/ Arkansas needs or must be listed as a
vu/Insurance/Commercial- 3.A. state. There is no doubt Arkansas
Extraterritoriality and Reciprocity
Lines/Workers-Compensation/ must be named a 3.A. state if the
Extraterritoriality and reciprocity ExtraRecipStatutes.aspx employees are working there more than
issues present a major problem for 14 consecutive days because Tennessee
• A webinar https://www.
agents. Which state or states must be law says that more than 14 days is not
iiaba.net/education/preview.
listed as primary 3.A. states, which considered temporary. Further, because
aspx?evt=27849 detailing
states can be listed as secondary the Arkansas reciprocal requirements
extraterritoriality and reciprocity.
(3.C.) states and which states can be are fuzzy, not naming it as a 3.A. state
essentially ignored? Let's look at a couple examples of may prove problematic.
extraterritoriality and reciprocity to
Remember that the extraterritoriality Example 2: Pennsylvania, Ohio and
explore these concepts more fully.
and reciprocity concept apply only West Virginia
when the insured has employees in Example 1: Tennessee and Arkansas
Assume the insured is located in
any state other than the domicile One or several employees work in Pittsburgh, PA. Because of its proximity
state or branch office states on a Memphis but live just across the to the southwest corner of the state,
temporary basis. If the operations Mississippi River in Arkansas. Assume employees drive daily from Ohio
are anything other than “temporary," that a governmental mandate and West Virginia for work. If these
the concept of extraterritoriality and prevents these workers from coming employees are forced to work from
reciprocity does not apply, the state into Tennessee for work and they home, are Ohio and West Virginia
with ongoing operations must be are required to set up temporary required to be listed as 3.A. states?
extended 3.A. status. operations in their homes in Arkansas.
First, the Pennsylvania's extraterritorial
Extraterritoriality relates to the The first question, does the workers' provisions must be reviewed and
coverage provided in the state compensation policy for the understood. Based on the reading
where the employer is located, and Tennessee employer/insured follow of the PA statute, extraterritorial
the employee is primarily based. any employees while they work protection appears to exist without
Extraterritoriality's primary question temporarily in other states? The a specific time limit. The only
is, does the employer's workers' second question, does the state to requirement appears to be that
compensation coverage follow the which the employees travel to work the employees are classified as
employee when he/she travels to on a temporary basis recognize the Pennsylvania employees. So, coverage
work temporarily in another state? employer's workers' compensation? extends from the Pennsylvania
The good news, every state provides
Yes, Tennessee provides extraterritorial employer's policy to workers working
extraterritorial protection. The bad
coverage on a temporary basis. from home on a temporary bases,
news, the extraterritorial extension of
However, the amount of time is whether in Ohio or West Virginia.
coverage is not consistent from state
relatively short. State regulations With the extraterritoriality question
to state.
define “temporary" to mean no more answered, are there reciprocity issues
The flip side to extraterritoriality is than 14 consecutive days and no that create problems? Ohio statute,
reciprocity. Does the state to which the more than 25 days in the calendar according to the state breakdown
employee travels to work recognize the year (aggregate). On the fifteenth linked above, reciprocates for 90
sending state's workers' compensation consecutive day, Tennessee ends its days. If the Ohio resident employees
coverage? Again, the answer is not extraterritorial protection. When the return to work before the end of 90
consistent and varies greatly from “sending" state's coverage ends, the days, the extraterritorial provisions
state to state. “receiving" state has jurisdiction. of Pennsylvania and the reciprocity
Details of extraterritoriality and Arkansas regulations aren't as clear. provisions of Ohio allow the employer's
reciprocity are not the focus of this The statute requires that the workers' Pennsylvania coverage to respond.
article. However, several resources comp carrier be licensed in Arkansas, However, Ohio's administrative code
are available from the VU detailing but there is no clear indication of specifically addresses Ohio-based
extraterritoriality and reciprocity. reciprocity, only and intimation. Thus, employees while working in Ohio for
To fully understand the issues and there may be no reciprocity, especially out-of-state employers. According
concepts, access the following: if the work comp carrier is not licensed to the code, when the Ohio-resident
• A state-by-state breakdown of the in Arkansas.
extraterritoriality and reciprocity (Con’t on page 15)
Maryland Messenger 2020 MAY/JUN 14(Con’t from page 14) only for use when it's not clear that 3.A. “coming and going rule" holds that
status is needed or the carrier will not travelling to and home from work does
allow a state to be granted 3.A. status. not benefit the employer (subject to a
employees are working in Ohio, they
A Bogus 3.C. Carrier Claim few exceptions).
are subject to the Ohio workers'
compensation laws. So, any amount of In response to a request to name However, the pandemic panic has
time an Ohio resident spends working a state a 3.C. state, underwriters temporarily placed us in abnormal
in the state subjects the employer to might say, “We can't list ________ conditions. Employees are working
Ohio law and benefits. It appears Ohio as a 3.C. state because we are not from home rather than at the
needs to be a 3.A. state from day one. licensed there." This is a bogus claim; employer's place of business. If
But this can't be done because Ohio underwriters may not want to list the these employees live in a state other
is a monopolistic state; thus, a policy state, but they CAN. than where the employer is located,
must be purchased from Ohio. are these considered temporary
Paragraph A.3. under Part Three – operations in another state? If
West Virginia applies an odd provision. Other States Insurance says: “We will or because they are temporary
The West Virginia statute allows reimburse you (the named insured) for operations in a state other than
the employer and employee to the benefits required by the workers' where the employer/insured is
contractually agree on which state's compensation law of that state if we located, the question of workers'
benefits the employee desires to are not permitted to pay the benefits compensation must be addressed.
access. In the absence of such a directly to persons entitled to them." The state in which the employee lives
contract, the reciprocal allowances are
Other than not being licensed in the and is working temporarily must be
30 days in a 365-day period. If there is
state, why would the carrier not be specifically addressed.
no contract and if the employee works
allowed to pay the injured worker? Just Rather than attempting to interpret
in their home state of West Virginia
because they don't want to list a state state laws regarding the extraterritorial
beyond 30 days, West Virginia requires
doesn't mean they can't. Don't let this provisions and reciprocal allowances
3.A. status.
objection stand unchallenged. of each state's workers' compensation
As may be plain to see from these
Home-Based Worker Injury law, simply name the employee's state
two examples, interpreting the
of residence as a 3.A. or 3.C. state
extraterritoriality and reciprocity If an employee is injured while
(depending on what the underwriters
provisions of a given state can be and working from home, will the injury be
will allow). There should be little or no
generally is tedious. Although a law compensable? This is a reasonable
effect on premium. This assures there
degree is not required, it helps. question, but the answer is far from
are no gaps in protection.
simple.
What Agents Must Do
Workers' compensation is designed
From and errors and omissions (E&O) Christopher J. Boggs, CPCU, ARM, ALCM,
to pay for injuries arising out of and in
perspective, agents must take the LPCS, AAI, APA, CWCA, CRIS, AINS, is
the course and scope of employment.
conservative approach and name the the Executive Director of the Independent
Regardless where the employee is
employee's state of a residence as a Insurance Agents and Brokers of America
injured, compensability is judged
3.A. state on an “If Any" payroll basis. (Big "I") Virtual University. His current duties
against these guidelines.
If the employee is in a monopolistic involve researching, writing, and teaching
state, buy the in-state coverage. A What was the employee doing property and casualty insurance coverages
less conservative but possibly still when the injury occurred? Is there a and concepts to Big "I" members and others
acceptable approach is to name the reasonable connection between the in the insurance industry.
employee's state of residence as a 3.C. employment and the injury or was
the employee pursuing his or her own Boggs is a regular speaker at industry
Other State (but this doesn't work in
interest? Any injury requires a fact- events, speaking for groups such as the
a monopolistic state). A particularly
intensive review. National Association of Mutual Insurance
bad approach is to try to interpret the
Companies (NAMIC), the National Society
laws of the relevant states and hope Key Takeaways of Insurance Premium Auditors (NSIPA),
everything dovetails correctly.
Under every day normal conditions the American Association of Managing
If the state does not require 3.A. employers are not required to include General Agents (AAMGA), the Institute
status, there is no premium charge for an employee's state of residence on of Work Comp Professionals (IWCP),
naming the state. If the underwriter is the workers' compensation policy - if and the CPCU Society.
not willing to give 3.A. status, use 3.C. that employee reports to and primarily
Remember, 3.C. is an “Oops" option works at the employer's location. The
Maryland Messenger 2020 MAY/JUN 15Business Income
Insurance...Does It
Cover Coronavirus
Shutdowns?
By Bill Wilson, CPCU, ARM, AIM, AAM
On March 16, a lawsuit (see https:// evaluate the claims in the lawsuit most business income policies do
www.insurancejournal.com/research/ in the context of the actual NOT cover shutdowns due to viral
app/uploads/ 2020/03/Oceana- policy form(s) involved and the pandemics. But, as this article intends
Petition-for-Dec-J-executed.pdf) was facts and circumstances of the to demonstrate, even if they did, the
filed in district court in New Orleans coronavirus pandemic, including amount of coverage available would
seeking a declaratory judgment the governmental orders impacting likely be minimal at best.
about whether the business income many businesses. The Lloyds policy in question,
coverage in a Lloyds property policy Let me offer two caveats before I according to the copy I received,
would cover a government-mandated begin. First, I am not an attorney offers coverage under the ISO CP
shutdown or curtailment of a and nothing in this article should be 00 30 10 12 – Business Income (And
restaurant due to the coronavirus. construed as offering any type of legal Extra Expense) Coverage Form,
The policyholder law firm filing the advice. My goal is to offer a coverage an industry-standard form and
suit asserted in a press release analysis based on policy language probably the most common business
that, “The policy issued by Lloyds and logic. Second, insurance is not a income coverage policy found in the
of London provides coverage for commodity. Policy forms are different insurance marketplace. With that as
a civil authority shutdown and and the analysis in this article largely the coverage basis for this article, let’s
does not contain an exclusion for addresses one industry-standard review the assertions in the lawsuit.
a virus pandemic.” As we shall see, form which, by chance, happens to be Policy Exclusions
the absence of a specific exclusion the form used in the Lloyds policy.
doesn’t mean there is coverage if The lawsuit’s “FACTUAL
There have already been numerous BACKGROUND” claims that the
the insuring agreement is never articles written, many by attorneys,
triggered. In addition, a literal reading Lloyds policy provides “all risk
opining whether or not most coverage.” It then goes on to say that
of the policy indicates that it, in fact, business income policies cover
does not provide coverage for a civil “An ‘all risk policy’ is an insurance
business interruptions caused by policy which covers all risks unless
authority shutdown of this type. viral pandemics and any resulting clearly and specifically excluded.”
The press release goes on to say, “We shutdowns imposed by civil That is not technically a factual
filed this action because we have authorities. Many of these articles statement. Presumably, it’s made
reason to believe that Lloyd’s took cite specific case law dealing with to support the statement two
premiums without the intention of pollution exclusions and what paragraphs later that, “The policy
providing the indemnity paid for.” constitutes “direct physical loss” in does not provide any exclusion due
If there is no intent to cover losses policy insuring agreements. At the to losses, business or property, from
caused by a viral pandemic (almost end of this article, I’ve included links a virus or global pandemic.”
certainly the actuarial intent), then to some of these articles, particularly
no premiums were taken to provide an excellent one entitled “Commercial The absence of a specific exclusion
coverage that does not exist or was Property Insurance Coverage and doesn’t create coverage. Coverage
not intended to exist. The assertions Coronavirus” by attorney Shannon is created initially by the policy’s
in the suit for potential fraud appear O’Malley of Zelle LLP. insuring agreement(s). Sometimes an
to be patently absurd. exclusion is included in a policy simply
The consensus of most legal pundits
The purpose of this article is to and insurance experts is that
(Con’t on page 17)
Maryland Messenger 2020 MAY/JUN 16You can also read
