Ohio Insurance Agents Association Enhances Partnership with Indium to Provide Independent Agents Market Access and Growth Solutions

GAHANNA, OH - Ohio Insurance Agents Association, Inc. (OIA) creates strategic partnership with Indium to provide agents expanded market access options and growth solutions.

Two Ohio-based, independent agent led organizations have come together in a strategic partnership to support the growth of the independent agency system. OIA, which has always had an ownership interest in Indium (formerly MarketSource), purchased a majority interest in the organization.

“The independent agency system must change to compete in the modern marketplace. Through this strategic partnership with Indium, independent agents will have access to market access, technology, and training resources to propel their businesses into the future,” stated Jeff Smith, CEO of OIA.

“OIA and Indium have been connected from the beginning of Indium’s founding in 2005 when volunteer agents worked tirelessly to create a leading market access solution that would be agent-led and maximize agent value.”

“We all know our industry is evolving at a rapid pace, and on all fronts. We sit in a unique position, where we see firsthand what agents, carriers, vendors and our peers are going through to remain relevant. Every aspect of the insurance supply chain is confronting significant disruption, all at once. It’s an extraordinary time for our industry, really. And as we’ve reinvented ourselves to meet the demands of our industry, we’ve also been looking for strategic partners with a common mission focused on helping independent agents stay independent, both now and in the future,” remarked Chad Eddy, CEO of Indium.

Since inception, Indium has helped hundreds of agencies in Ohio and across the country grow their business and maintain their independence. To date, Indium supports nearly 400 agency partners across 10 states, with 85 percent located in Ohio.

“OIA and Indium share common missions, visions, values, cultures, agent leadership, staff, priorities, growth strategies and agency partners and members, so coming together makes great sense,” said Matt Simon, CIC, CPCU, Chairman of the OIA Board of Directors and Principal with Hill and Hamilton Insurance Agency in Bellefontaine.

“As an association, we need to evolve and ensure we are providing value to our agents, and our strategic partnership with Indium solidifies our value proposition. Through this partnership, our agent and carrier partners can expect continued support for Indium’s market access solutions and technology solutions, strengthening an agent-led partner to grow the independent agency system and compete in the modern insurance marketplace.”

“Bringing together agent led organizations who share the same mission, to help independent insurance agents grow and prosper, ensures that our agents’ success is always the focus of our partnership. We have complimentary services for independent agents, which makes this partnership a natural fit with our collective mission to promote, protect and progress the independent agency system,” said Eddy. 

“This partnership is an exciting opportunity to provide independent agents with market access solutions, local ownership and a focus on improving services and offerings,” said Smith.

For more information on this alignment please see OIA and Indium's joint letter.


About Ohio Insurance Agents Association

Ohio Insurance Agents Association (OIA) is the collective voice of 1,300 independent agencies that employ nearly 10,000 Ohioans. We promote, progress and protect the professional advice and guidance only independent insurance agents provide. OIA members write 82 percent of the commercial insurance policies and 44 percent of personal insurance policies in Ohio. OIA helps agents by providing agency valuation, succession planning, generational health, operational benchmarking reports, other business solutions and industry thought leadership.

About Indium

Indium (MarketSource Agency Network, LLC) was founded in 2005 out of the OIA, who assembled a team of thought-leading independent insurance agents to develop an innovative solution for the purpose of helping independent insurance agents stay independent. This team of agents – our founding fathers – volunteered their time to collaborate, cooperate and strategize for each other’s benefit and to strengthen the independent channel and developed MarketSource Agency Network to provide independent insurance agents access to the standard markets they needed to grow their insurance agencies without the burden of ever-increasing production requirements of carriers, or giving up control of their business.

In 2016, we changed our company name to Indium (Why Indium) to reflect the vision and energy of our new “indie agent” brand. In staying true to our founding principles, Indium is a leading market access provider whose focus is to facilitate enhanced revenue and profitable growth opportunities for our agency partners and companies. We are still owned and directed by independent agents, and we support agency partners across the country who have placed over $50 million in written premium with our company partners.

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OIA Enhances Partnership with Indium

We are excited to share with you that we have enhanced the partnership between Ohio Insurance Agents Association (OIA) and Indium!

OIA and Indium (formerly MarketSource) have been connected from the beginning of Indium’s founding in 2005 when volunteer agents worked tirelessly to create a leading market access solution that would be agent-led and maximize agent value.

In doing this, we have established a service that has helped more than 500 Ohio agencies grow their business and maintain their independence. All the while, the solution has remained solely owned by independent agents.

While much has changed since 2005, several things have remained aligned: OIA’s and Indium’s missions, visions, values, cultures, agent leadership, staff, priorities, growth strategies and agency partners/members. Knowing there has always been crossover in organizational leadership and engagement has led us back closer together.

OIA’s and Indium’s agent leadership spent many hours over the past year designing the opportunity for a closer relationship to share resources and preserve a strategic, agent-friendly market access solution for independent agents. Recently, OIA purchased shares from agent equity owners and now holds a majority interest in Indium.

This greater partnership provides many opportunities for both OIA’s members and Indium’s agency partners, including:

  • Leveraging the collective strength of our organizations

    • OIA and Indium have agency leaders and staff working toward similar goals

    • We offer complimentary services that fit well with partner organizations

    • Given our overlapping strategies, aligning our resources will allow us to serve independent agents in a more efficient and effective manner

  • Aligning our organizations will allow us to maintain an ownership, presence and high level of service established by the agent leaders and organizations that founded Indium

  • Serving a similar constituency – 324 of Indium’s 378 agencies are Ohio-based independent agencies and members of OIA

What this means to you:

  • Continued support for Indium’s market access solution and technology solutions, preserving an agent-led partner to grow your agency and compete in the modern insurance marketplace.

  • Market access solution – joint review of the service model, carrier lineup, commissions, contingencies and other program arrangements.

  • OIA dues, Indium partner fees and contract – Our agent leaders are meeting in early March to discuss these issues and will have more to share with our collective members in the coming months.

In the face of the many changes happening in our marketplace, we know that OIA and Indium are stronger together. We will be able to more effectively and efficiently serve independent agents by strengthening our partnership. We encourage you to learn more about the services OIA and Indium provide and how they can help you grow your agency.

Please contact any of us, or our business leaders, OIA CEO Jeff Smith at (800) 555-1742, or Indium CEO Chad Eddy at (614) 942-1470 if you have any questions, feedback or would like additional information on this strategic partnership.

Thanks again for your continued support of OIA and our efforts to promote, protect and progress the professional advice and guidance only independent insurance agents provide.

QUESTIONS?

View letter from OIA here

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Personal Umbrella Rate Change

RLI Personal Umbrella rates will be changing as of 4/1/2019 for new business and 6/1/2019 for renewal business in most states.  As of today, RLI has received approval in all states except California and Colorado for a modest rate increase. We will also be introducing additional rating changes at this time. Highlights to be aware of include:

  •  A 5% increase on Excess UM/UIM rates, including states rated on a per driver basis. For example, $150 per driver becomes $158 per driver

  • Incident surcharge for drivers under 22 and/or 80 and older have increased from $100 per incident to $200 per incident. In addition, this question (question 14 on new business) will be split into 14a and 14b in PUP Access, but will remain the same combined question on the paper application.

  • On new business, we have removed the $100 surcharge for a driver licensed less than one year, with a permit, or international license (Question 13). A response greater than zero will continue to place the risk in PUP Special, and restrict to $1M coverage.

  • Surcharge increase for households with a youthful or inexperienced operator, as well as an increase in the 80+ surcharge in NY, PA, and GA.

As always, the updated rates will be available by quoting within PUP Access or at www.rlipup.com, and will be in compliance with state-approved filings.

Please refer to the below chart for the effective dates for New and Renewal Business: 

  

Place your personal umbrella business in RLI’s home-business insurance program. The most popular business classes include, jewelry (costume or “fashion”), photography, tutor/teacher and crafter.” 

For more information on the rate change visit RLICORP.com or visit our page on RLI Personal Umbrella Insurance. 

Learn more


Big ā€˜Iā€™ Secures Tax Break for Pass-Through Agencies

On Friday, the IRS issued final regulations governing Section 199A of the tax code. The rule confirms that owners and shareholders of insurance agencies and brokerages organized as pass-through entities are eligible for a tax deduction of up to 20% on “qualified business income”—regardless of taxable income level. The deduction is available for taxable years 2018 through 2025.

The new deduction reduces the top effective tax rate on pass-through income to approximately 29% from 37%. For those in the 24% bracket, it can reduce the rate to as low as 19.2%.

The regulation is a significant government affairs victory for Big “I” member agencies. Since passage of the 2017 tax reform law, the Big “I” has been aggressively advocating before Congress and the Trump Administration to ensure that insurance agencies and brokerages organized as pass-through entities fully benefit from tax reform.

The final regulation is substantially similar to a draft regulation released in August. Under the regulation, owners and shareholders of insurance agencies and brokerages where the owner or shareholder’s annual taxable income does not exceed $315,000 for joint filers and $157,500 for single filers in 2018 can take a 20% deduction on qualified business income.

For insurance agencies and brokerages where the owner or shareholder’s annual taxable income exceeds these levels, the deduction is available for qualified business income derived from the sale and servicing of insurance products. However, the deduction may be limited on income derived from consulting or financial services activities if that non-traditional income exceeds certain de minimis thresholds. Additionally, above these same income levels, the total amount of the deduction cannot exceed 50% of employee W-2 wages, or 25% of W-2 wages plus 2.5% of capital assets, such as tangible property purchased for the business—whichever is greater.

Owners and shareholders of insurance agencies and brokerages organized as pass-through entities can take full advantage of the 20% deduction, no matter their taxable income levels, because the IRS does not consider the sale and servicing of insurance products to be a “specified service trade or business.” Other professions such as doctors, lawyers, accountants, stock brokers and certain consulting and financial advisory activities are a “specified service trade or business” under the regulation.

Owners and shareholders of “specified service trades and businesses” with annual taxable income between $315,000 and $415,000 (joint) and $157,500 and $207,500 (single) will slowly see the deduction phased out. Those above $415,000 (joint) and $207,500 (single) are prohibited from utilizing the new deduction.

While a major victory Big “I” members, the regulations are complex. The Big “I” encourages members—especially those who derive income from non-traditional activities—to consult a tax professional to determine how the new deduction specifically impacts their businesses.

Jennifer Webb is Big “I” federal government affairs counsel.


Gov. DeWine Reappoints Froment as Insurance Director; McCloud to Head Ohio BWC

A few days before his official swearing in, Gov. DeWine made appointments to fill nearly his entire cabinet. All cabinet appointees are new to their roles, with the exception of Jillian Froment, who DeWine reappointed to continue to serve as the Director of the Ohio Department of Insurance.

Director Froment has spent the past eight years at the Ohio Department of Insurance in several high-level positions including Assistant Director, Chief Administrative Officer and Deputy Director. In May of 2017, Gov. Kasich appointed her Director.

In addition to serving as the head of ODI, Froment serves in prominent leadership roles for two national insurance organizations focused on consumer protection and the modernization of state insurance regulation. In November, it was announced that she was re-elected chair of the Interstate Insurance Product Regulation Commission as well as secretary-treasurer of the National Association of Insurance Commissioners Midwest Zone.

Gov. DeWine also appointed Stephanie McCloud to head the Ohio Bureau of Workers’ Compensation. McCloud is a veteran executive with a diverse background that includes 20 years of experience in public administration and workers' compensation. She most recently served as senior vice president at Sedgwick Claims Management Services while managing her private Columbus law firm, McCloud Law LLC.

McCloud began her career as a staff attorney at BWC before serving as legal counsel to both former Governor George Voinovich and the Ohio Department of Transportation. She later joined the office of former Attorney General Jim Petro, first as senior deputy attorney general before advancing to chief counsel.

In addition to these developments, Larry Householder was elected earlier this month to serve as the Speaker of the Ohio House of Representatives. Given this change, it is not yet known who will be named to lead the House Insurance Committee. Senate legislative committee announcements are also forthcoming from Larry Obhof, who was re-elected by his peers to serve once again as the Senate President.

What’s ahead in 2019?

As is the norm in the start of a new General Assembly, the first order of business will be the next two-year budget.

As for insurance issues, another attempt will likely be made to pass legislation to help OIA members who write group health insurance by requiring health insurance companies to provide claims data to those with fifty or more enrolled employees in their group. Unfortunately, Senate Bill 227, which would have achieved this, failed to make it across the finish line in December before the end of the last legislative session – mostly due to running out of time.

OIA supports this initiative, along with other groups such as the Ohio Association of Health Underwriters and the National Federation of Independent Business, because allowing risk advisors and employers access to claims data will help Ohio employers to properly assess their health care options and make better coverage decisions.

In addition, guidance and rules are yet to be developed by the Ohio Department of Insurance for the new insurance-specific Ohio cyber law. This law has several provisions, including investigation and breach requirements that all agencies, regardless of size, will be required to comply with should they learn that a cybersecurity event has or may have occurred. In certain instances, notification of a breach may even be required to the Ohio Department of Insurance.

Large agencies will also be required to develop and maintain a comprehensive written cybersecurity plan and exercise due-diligence requirements over third-party service providers.

An effective date is not yet available for Senate Bill 273, but it will likely be around mid-March. Stay tuned -- OIA will continue to keep you informed on these new cyber requirements as more information becomes available.

Learn more about SB 273.

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