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Directly to MEMBERS ... Directly from NAAFA
New update as of 12-9-2019! -- #84 - A Message I Hate to Write! Follow the link and sign in with your member password. Please honor the confidentiality of this information. These messages are for dues paying members. Thank you for your support.
The NAAFA staff.



Agent/Company Issues

What You Need To Know About the Class Action 

  Item I:  A few people have contacted the NAAFA office saying officials from American Family are suggesting the case is over and AmFam has won. The case is not over. The plaintiffs have filed a petition with the U.S. Supreme Court asking for a review. AmFam's response to the petition is due on October 25. The plaintiffs will then have 14 days to file a reply brief. The Supreme Court could make a decision to grant the petition and hear in the case as early as December of this year. The plaintiffs (agents) are excited because the Stanford Law School Supreme Court Litigation Clinic has agreed to represent the agents on the appeal to the Supreme Court.

Remember, although Jammal won in the district court, AmFam won in appellate court on appeal. Because the plaintiffs believe the appellate decision caused a circuit split, Judge Nugent stayed the district court case pending a decision by the Supreme Court. So there is no winner until word comes from the Supreme Court. Of course, NAAFA members have been kept up-to-date on these and other issues through the Directly to Members…Directly from NAAFA column on the member-side of www.NAAFA.com

Read the petition filed by the plaintiffs with the US Supreme Court on August 22nd by clicking on the link in Item II and read American Family's response in by clicking on the link in Item III..  10/28/2019


UPDATE:    NEW —  Item IV

     Item II:   Plaintiffs Petition for a Writ of Certiorari
     Item III:  Respondents (American Family) Brief in Opposition

     Item IV:  Plaintiff's Rebuttal to AmFam's Brief in Opposition -- 11/13/2019   

Keith Ellison asks FTC to ban employers' noncompete clauses Take a look at the states that have signed on to this, including Wisconsin. Is Keith going to get some static from AmFam on this one?? 11/19/2019

How Small Businesses Are Training for Active Shooters It's sad that we have to even think this way, but do you and your staff know what to do if an irate customer or former employee turns 'assailant' and decides to "get even" by entering your office workplace and begin shooting? Several companies are mentioned in this article that provide staff training in emergency situations. Please Read Carefully! 8/27/2019

State Legalizes Assisted Suicide - but Questions Over Whether Insurance Will "Do the Right Thing":  Maine became the 8th state to legalize medically assisted suicide (following CA, CO, HI, OR, VT, WA, NJ) Many feel assisted suicide is a dangerous public policy that puts vulnerable people at risk for abuse, coercion and mistakes. It also, some say, provides profit-driven insurance companies perverse incentives to offer a quick death, rather than costly continuing quality care. Wow! Something to think about, right? 6/13/2019

ALERT: Three Captive Insurance Companies Are Being Sued For Misclassifying Agents As Independent Contractors: Don't miss this article. We think it's time everyone hears about what is going on. Read about the three class actions, all for the same cause, filed against American Family, Farmers, and State Farm. Does this send a message? 4/23/2019

American Family Insurance to Acquire Ameriprise Auto & Home for $1 Billion: The changing face of AmFam continues to undermine the independent contractor status of the agents. One wonders what they have in mind for their captive agents' futures. 4/2/2019

What's the Future of Agent Distribution? By Andrea Wells It might surprise you to find that some experts are predicting a very bright future for insurance agents. Yes, captive companies are reducing their captive agent pool, but they may be forgetting the importance in the consumer's eyes of a local brand. Agents can and do adapt to the needs of their customers, including those who want to interact via mobile devices and online. Beware, insurance companies, because agents still control the market and you may find your future is still in their hands! 2/4/2019

The Wealth Gap and Miller Park's Deal: Well, they've done it again. Of course there's no limit to how deep AmFam's pockets are because they're robbing their agents to get it. Believe us when we say that daily we hear from agents who are screwed out of not only thousands of dollars, but are having their whole agencies taken away from them. It's absolutely outrageous, and Bruce Murphy points it out very well in this article. It is simply hypocritical that the company can brag about it's agents and yet treat them so horribly. As we have said many times ... the dream they say they are protecting is the agents' nightmare! 1/25/2019

Insurance Agents Assured of Trump Pass-Through Tax Break under Final Treasury Rule: Wow, at last a break for insurance agents! A 20% deduction, referred to as the Section 199A deduction, is available for the first time on 2018 federal income tax returns. This 20% deduction was designed to target small businesses that don't benefit from the Trump tax law's reduction in the top corporate rate from 35 percent to 21 percent. GOOD NEWS. 1/25/2019

Wisconsin's Next Governor Picks Insurance Commissioner: And guess who it is?? American Family's own Mark Afable. We'll let you imagine the implications of this one. 12/29/2018

Will State Farm's "no Al" words come back to haunt the company? Of course, we agents here are AmFam would have to agree with State Farm, but one must ask whether or not we are really seeing the writing on the wall. How important is a compassionate, human agent whose rates are so high the customer won't buy anyway? Could the captive agent be backed into the corner when he only has one company to sell for? 10/31/2018

Prudential Joins Direct-To-Consumer Movement: Attention "captive agents:" If you think this isn't a trend, you're sadly mistaken. Does the wise agent make the shift to independent now, or wait till his captive company shuts him down? 9/4/2018

State Farm Agrees to Pay $250 Million, Avoids Racketeering Trial: Moral of the story is "don't ever assume the judge hasn't been bought off." This whole saga seems once again to show how often insurance companies get by with just a slap to the hand. Meanwhile, policyholders continue to be hurt. 9/4/2018

Class Action Settlement Insurance: Hmmm! Don't you wonder if American Family has this? Here's hoping they have a need for it soon!! 8/31/2018

U.S. Appeals Court Takes Up American Family Agent/Employee Clasification Case: No answers just yet on this decision that will certainly impact many agents and their families. Employee-type control at AmFam has been extremely evident for years and years, according to the complaints the NAAFA office receives. Recently, we learned that agents were mistreated as far back as the late 1970s, information that is new even to us. We pray that the appellate judges will open their eyes to this abuse. NAAFA members can read more in our members-only column, Directly to Members, Directly from NAAFA. 8/3/2018

Nationwide Hit With Agent Lawsuit Over Business Model: It appears captive agents at Nationwide aren't at all happy about their choices for getting their book of business back after being shoved out.  7/18/2018

ALERT! Do Advance Commissions apply to your Termination Benefit Package? NAAFA has suspected for quite some time that the Advance Commissions/renewals are not being applied to the formula for determining your Termination Package amount. ALERT! Click on the link to see the announcement about this important issue.  6/21/2018

American Family, Main Street America Reveal Plans to Merge: The combining of captive and independent agents ... what a concept, but is it going out of style? Think "Nationwide!!"  5/4/2018

Why Independent Agents Remain Alive and Well: NAAFA certainly agrees with the author here who says insurance agents are NOT going away. Gotta love it!!  4/30/2018

Independent Contractor Bombshell for CA Businesses: CA Supreme Court Curtails the Lawful Use of ICs It seems the environment is still ripe for ruling against the misclassification of independent contractors. CA now joins MA by adopting a 3-point factor test to determine how workers are to be classified. This new ABC test presumes all workers to be employees unless they perfectly fit this 3-point factor test. A fascinating read!!   4/30/2018

Nationwide Switching to Independent Agency Distribution Model by 2020 Of course, the question being asked, "Is this because of the Jammal v AmFam misclassification case?"   4/17/2018

Agent Responds to the Green Beret Sgt    4/6/2018

Agent Responds to "Writer Who Chooses to Minimize the Hurt of Terminated Agents"    3/15/2018

Writer Chooses to Minimize the Hurt of Terminated Agents! All Comments Are Appreciated.   2/26/2018

Top 10 Employment Discrimination Charges in 2017: 84,254 workplace discrimination charges were filed with the EEOC in 2017. Read about the different types here   2/16/2018

Age Discrimination Suit Focuses on Facebook Ads Allowing Employers to Target Younger Workers No matter how you look at it, age discrimination is a big issue with some companies. They hire and fire certain people in certain age brackets. And often, they get by with it. Sad!   12/22/2017

CEO Says Insurers Should Strive to be Loved: You gotta read this. To reach this goal one must really have to have faith….in something!! Not sure what. Let NAAFA know what you think. Is this a realistic goal?  12/14/2017

Class Action Lawsuit Filed: Farmers Agents have filed a Class Action lawsuit against Farmers Insurance Exchanges claiming that the agents are misclassified as independent contractors when in reality they are being treated as employees. Sound familiar? The case has been filed by Crueger Dickinson LLC, the same law firm that is handling Jammal v American Family. Be sure to read the actual lawsuit papers filed at the www.ufaa.com website.  12/5/2017

Federal Court Rules Against Classification of Captive Agents as Independent Contractors Sort of interesting how the Big "I" wrote this article up. Many news outlets are carrying this story each with their own slant. And so we wait to hear whether the appellate court will hear the case or not. NAAFA members will be the first to know. Check our member-side by using your password.  9/7/2017

Farmers Insurance Exchange must make refunds to 1,600 drivers: Makes you wonder whether insurance companies will try anything thinking they probably won't get caught. Sad thing is, most of the time, they don't. Well, this time they did.  8/17/2017

Where are the Thought Leaders in the Insurance Industry?  The author made a good point here when he noticed that the insurance industry doesn't seem to produce any leadership people with opinions and ideas that might be pertinent to those discussing the emerging risk issues of today. He also points out that young mental gymnasts don't seem to be attracted to the insurance field because the industry seems to be portrayed as , shall we say, boring? An interesting read.  7/7/2017

UBER'S Former CEO & Current Chairman of the Board Sued Personally for Independent Contractor Misclassification:  When advisors of a company willfully misclassify employees as independent contractors, it appears there are other ways to seek restitution. You might be interested in reading about this case. Having an arbitration clause in a contract might encourage misclassified workers to personally sue those in charge, but even without such a clause in one's contract, this alternate avenue presents an interesting backup means for misclassified workers to seek restitution, doesn't it?  6/24/2017

The Greed of American Family  You won't want to miss this one! This is a very recent article written by Bruce Murphy of the Urban Milwaukee. It might just spark your interest. The article seems to throw a clear beam of light on what has really been happening over the years. You might want to read the comments at the end of the article, too. Or better yet, add some of your own.   4/4/2017

Following are several links to news releases that have come out regarding the recent jury decision in the Jammal v American Family class action trial. Each news article adds a bit of a different slant to the report. Check some of the "comments" at the end of some of the articles, especially the Insurance Business Magazine.com article. 4/21/2017
AmFam Ins Misclassified Agents, Says Federal Jury
AmFam Ins Could face $1 Billion in Legal Liability
Jury says AmFam Ins Misclassified Agents in Class Action Seeking Retirement Benefits


JAMMAL V AMERICAN FAMILY;
THE UNANIMOUS JURY VERDICT
IS THAT AGENTS ARE, IN FACT, EMPLOYEES. THE AGENTS WON!!
It will be some time before the judge comes back with the penalty, but just knowing that the jury agreed with Plaintiffs on behalf of the agents is awesome. Hey, give God the GLORY!  4/18/2017

Insurance Industry Jobs Among the Most Stressful: Study  Interesting article, but it's not telling us anything we don't already know. You may want to go to the link in the article "ranking No. 2 in a recent study" where it says stress "all depends on the prevailing workplace culture, leadership, workload demands and a host of other factors." Some report to us that we have them all!!  4/17/2017

Former AIG Chairman Greenberg Admits to Wrongdoing in Longstanding N.Y. Fraud Lawsuit  Is it the type of business that attracts corruption or is it that corrupt people are attracted to the insurance industry? Either way, it sure seems like we're hearing about a lot of it in this area.   2/13/2017

Concerning Agents' Email Regarding Ethics Survey:  It has been reported that AmFam agents have received on or about January 9, 2017, an email asking them to participate in an anonymous survey with subject matter being, "The Current Culture and Practices related to Ethics and Compliance." You are given until January 20th to respond. Many have reported to this office that corruption rampantly abounds within the company. Listen closely. Now is your chance (some would argue it's even your obligation, perhaps) to let the company know how aware you are of the excessive amount of corruption you know exists within the corporate walls of the company you work for. It appears this is a 2016 American Family Compliance and Ethics Leadership survey by CEB Corporate Leadership Council out of Arlington, VA.   1/10/2017

How Layoffs Hurt Companies  We have seen hundreds of "layoffs" (well, terminations and forced retirements, if you want to get technical!!) at AmFam. This article points out some of the harmful effects of laying off people. One of the quotes the article uses is "Firms that are laying off are almost by definition in trouble." By Peter Cappelli. Interesting observation? You decide!!   12/12/2016

Jammal, et al.v.American Family Ins. Group, et al   The class is being notified by Kurtzman Carson Consultants (KCC) of College Station, TX of their right to "Stay in this lawsuit" or "Get out of this lawsuit." The case will proceed to trial on January 23, 2017 at 8:30 AM in the Carl B. Stokes U.S. Court House in Cleveland, Ohio. You may read more about the case by clicking on the court case above.  11/25/2016

MUTUAL HOLDING COMPANY: A Shell Game  NAAFA received the link to this article just recently with a note that we should 'get this out to everyone' and that is just what we're doing. Although written back in 2001 when Liberty Mutual was going the holding-company reorganization route, what the author has written here is perhaps a real eye-opener. Here's one sentence from the article that might peak your interest: “So what's wrong with what Liberty Mutual wants to do? Nothing, if you're a fan of legalized bait-and-switch schemes.” More on this on the member-side. See Message #12  10/10/2016

State Farm accused of bankrolling judge to throw out $1B case against company.  Some State Farm customers claim the company conspired to help elect an Illinois Supreme Court candidate so he could vote to throw out a $1B award against the company. [Read more on this on the MEMBER-SIDE under Directly to Members ll Directly from NAAFA]  10/3/2016

The FedEx Driver Who Sued and Won:  For those interested in a case not completely unlike Jamal vs American Family (class action) please read this catch-up article. The dispute is whether the FedEx drivers are employees or independent contractors.  8/25/2015

Companies must Report CEO-to-Worker Pay Ratio under new SEC Rule: Oh, oh!! This should prove interesting since one of the hottest topics of discussion lately has been CEO compensation. One would disparage 'cooking-the-books' to justify one's salary, wouldn't one?  8/6/2015

Labor Dept's 6-Part Test for Classifying Employees, Indep. Contractors: New guidelines for classifying workers under the Fair Labor Standards Act (FSLA) has been issued by the US Dept of Labor. As our readers know, the question of whether AmFam agents are independent contractors or employees is a hot issue right now. The Insurance Journal has summarized this for you, but the original memo can be found at http://www.scribd.com/doc/271748996/Labor-Department-Memo-on-Classification-of-Employees-v-Independent-Contractors.   7/20/2015

Why McKinsey's Prediction of Demise of Independent Agents is 'Dead Wrong'!  If you haven't been watching these comments by the independents regarding the controversial McKinsey Report, McKinsey Report you are not keeping up with what's going on in the insurance world. (AmFam uses McKinsey as a consultant.) Here is quite an interesting response to the McKinsey Report just hot off the press. You need to read it carefully. It may open your eyes to the security of your own future. 10/29/2013

12 Agents' Thoughts on their Futures in the Industry!  12 independent agents sound off about The McKinsey Report ... (that their futures are limited). AmFam agents need to sound off, too. Changes being made (by AmFam presumably as a result of their agreement with the McKinsey Report,) are causing heartache and great inconvenience for AmFam agents. 10/17/2013

Top-Ranked Carriers Build Agent Satisfaction into Culture!  Which consultant should AmFam have hired? Mckinsey or Deep Customer Connections? (Remember, they hired McKinsey!!) Deep Customer Connections, we're told in this article, has a niche focus on building a better relationship between carriers and independent agents. This idea seems to be in direct contrast to the philosophy of the McKinsey group. Read it for yourselves….you decide. 10/17/2013

McKinsey to Agents: Adapt or Find Another Line of Work!  Well, this article has caused a lot of uproar with insurance agents across America, and it's not hard to see why. McKinsey compares today's insurance agents' futures to those of yesterday's travel agents…..almost gone! What's your opinion? Is AmFam drinking McKinsey's Kool-Aid? 10/16/2013

FreeAdvice.com is a site where customers can post their thoughts regarding their insurance companies. See what customers are saying about American Family. Scroll down to get the most recent comments.  11/15/2010

Want to “vent” about your job or company? www.jobvent.com is the place to do it. Read what others are saying, also.  7/23/2010

Did you know copiers have hard drives?  
Information that you copy could fall into the hands of the wrong people, particularly the company you lease your copier from. Agents BEWARE!  5/16/2010


What Every Agent and Customer Should Know About Clue Reports!  1/23/2010

IRS Private Letter Rulings!
        American Family agents, and other captive agents, are considered independent contractors by the IRS. Since the IRS issued Private Letter Rulings for most of the captive companies, captive agents who filed SS-8’s found their appeal rejected immediately because of these Private Letter Rulings. Very few agents have actually read the 111-page Correspondence between AmFam and the IRS, nor have they read the summary American Family Private Letter Ruling so we are posting both of them for you. You will be interested to read about how little ‘control’ the company is supposed to have over the operation of your agency.
        Information in an Allstate Private Letter Ruling states that an independent contractor agent has an “economic interest” in the customer list, and agents will realize this ‘interest’ when they are either paid by a 3rd party for their business OR the agent receives termination benefits based on a formula designed to equal a fair market value of their accounts. [Paragraph 6 under Independent Contractor Phase, (Allstate Ruling)]
        This presumes a fiscal value which should allow an agent to claim capital gain when paid termination benefits. Even more interesting is the fact that AmFam issued a document that says “Formerly called Extended Earnings, the name was changed to “Termination Benefits.” These are payments made to the former agents not to compete.” (See SECA Kit)
        The non-compete clause applies for one year.The AmFam contract does not state that a customer list cannot be used after the one year because logic would dictate that you’d have to have in your possession a customer list in order to begin competing after the one year.



The 20 Common Law Factors of a Perfect Independent Contractor Relationship

Deliberately Misclassified? What Allstate Has In Common With FedEx!
This article appeared recently in the Allstate Agent Association’s Winter 2008/2009 issue of the FOCUS. The article deals with the ongoing question of whether captive agents are independent contractors or employees. We suggest you read this article carefully. You might find you are able to substitute American Family’s name each time you see Allstate’s name. Quoted from the article, “If it Quacks Like A Duck, It’s Probably a Duck.”  3/14/2008


Captive Agents, the Forgotten People!"
NAAFA is again honoring agents’ requests to remain anonymous out of fear of retribution regarding this article, but we think this is perhaps one of the best letters we have received which summarizes the position and fate of all captive agents in America. You won’t want to miss this!  2/28/2008


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Articles, opinions, and viewpoints found on www.NAAFA.com are not necessarily the opinions and viewpoints of NAAFA. The opinions expressed are not those of American Family Insurance Company or any of its subsidiaries. The NAAFA.com website’s express purpose is to provide a medium whereby articles pertinent to the industry may be posted and reviewed and also to provide a medium whereby people can express their opinions in written form for any interested parties to view. The NAAFA.com website also provides information specifically for its paying members to view and this disclaimer applies to those articles as well. Therefore, NAAFA disclaims any liability for any harm that may be done as a result of these opinions being expressed herein. The NAAFA.com website does not guarantee accuracy and correctness of articles posted.
 
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