American Agents Alliance Conference Focuses on the Future

By | October 20, 2003

More than 1,400 agents and brokers ventured out to an oasis in Indian Wells, Calif., to take part in the American Agents Alliance 29th Annual Conference and Expo held on Oct. 8-12.

The four-day event, held at the Renaissance Esmeralda Resort, offered attendees a wide-variety of educational seminars and social events, including a trade show expo with 88 exhibitors.

“The convention was a success,” said Maria Palmer, convention chairman. Palmer, who has been a member of the Alliance since her insurance career began in 1983, said the Alliance strives to provide an environment that is helpful to industry affiliates, new and old timers alike.

“Many industry professionals get stuck in a rut, doing what they’ve done for many years,” she said. “Our purpose is to reach out to professionals—those who are new to the industry and those who have been working in it for years—to share new and fresh ideas on how to do business.” Palmer claims that her involvement with the Alliance has provided valuable support to her professional growth.

After a day of registration, this year’s conference kicked off with a golf tournament at the Golf Resort at Indian Wells. “Our convention is focused around networking opportunities,” Lorelle Kitzmiller, Alliance executive director, said. “We try to contain costs so that attendees get the maximum benefit for their dollar.”

The conference also had plenty of options for producers seeking continuing education credits. Educational seminars offered attendees a chance to earn CE credits from course topics ranging from “Agency Management” to “Coping with New Privacy Regulations.”

Regulatory requirements surrounding new financial privacy legislation was a top concern for many producers. The conference devoted two sessions exclusively to this topic, but other sessions addressed privacy issues as well. Additional CE courses tackled specific coverage matters such as commercial and personal auto, computers, umbrella and medical professional liability.

Trade show exhibitors had a steady stream of traffic as many attendees stopped by to get the latest product information and numerous freebies for the kids. Spouses and family members were welcomed and the resort offered recreational activities for all.

Agent vs. broker
The conference theme, “Focusing on the Future,” seemed well-suited for many of the brokers in attendance who had one thing on their minds—the future of personal lines brokers in California.

The opening general session featured a keynote address by Assemblymember Tony Strickland (R-Thousand Oaks), and a panel discussion titled “Is the California Personal Lines Broker an Endangered Species?”

While most panelists agreed that personal lines brokers are not in danger of extinction, all cautioned that legislative action to distinguish a broker from an agent is crucial.

The panel discussion comes on the heels of an Alliance sponsored bill, Assembly Bill 1297, which aims to differentiate the status of a personal lines broker and agent. AB 1297, authored by Assemblyman Dario Frommer (D-Los Feliz), was designed to confront two issues that are not clearly defined in California’s Insurance Code—broker fees and binding authority.

The threat to eliminate broker fees has been a long-standing issue between brokers and the California Department of Insurance. However, the threat turned into a full-fledged battle after the Superior Court in San Francisco decided in Krumme vs. Mercury that Mercury had violated the law with the wording of its producer contracts and the alleged treatment of brokers as agents. It was not found that the charging of broker fees was illegal or inappropriate, but instead brought to light the importance of clarifying the legal distinction between broker and agent.

According to panelists, brokers transact on behalf of the insured, whereas an agent transacts on behalf of the insurer and therefore holds binding authority. Panelists urged producers to review their contracts with insurance companies to make certain that they reflect their relationship as a broker.

Kitzmiller said that AB 1297 has been amended several times since its original form, but has been passed by the State Assembly Insurance Committee and floor. “The bill is currently in the Senate Insurance Committee,” Kitzmiller said. “The Alliance will review the language to modify the bill again when the Legislature convenes in January. We are committed to produce legislation that will allow producers to transact as a broker, and that will continue to give consumers a choice when purchasing insurance.”

The conference concluded on Sunday with an insurance executive roundtable discussion and a keynote address by California State Sen. Jackie Speier (D-Hillsborough), chair of the Senate Insurance Committee.

Sen. Speier stated that she has spoken many times with the Alliance and Kitzmiller regarding the specifics of AB 1297. Speier claimed that while the Senate Insurance Committee has some concerns about the current bill, she promises to bring all sides of the issue together for a compromise in the 2004 legislative session.

The session ended with an informative discussion from industry executives, moderated by the Insurance Journal’s national editor Andrea Ortega-Wells. Executives included John Mullen, president, Unitrin specialty lines division; Mark Niehaus, general manager, Progressive personal insurance; Jim Schaller, president and CEO, Western United Insurance; Don Simon, president, Bristol West Insurance; and Gabriel Tirador, president and COO, Mercury Insurance.

Kitzmiller said that plans are already underway for next year’s conference to be held in Sept. or Oct. 2004.

About Andrea Wells

Andrea Wells is a veteran insurance editor and Editor-in-Chef of Insurance Journal Magazine. More from Andrea Wells

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