In this episode of the “…and Insurance” podcast, Aaron Levine and Casey Yarger, of Petri Insurance, discuss Casey’s recent trip to the State House in Trenton, New Jersey, where he testified on behalf of insurance agents and consumers throughout the state. Casey, a fourth generation insurance professional shares his expertise in the industry and his experience advocating for the insurance community through his involvement with the Professional Insurance Agents of New Jersey. The two also discuss the issue of step down provisions in personal auto insurance policies and how they can reduce coverage limits for policyholders in certain circumstances
Aaron (00:00):
This is Aaron Levine, LG Insurance with another episode of the and Insurance POS podcast. We’re talking insurance and insurance and advocacy and insurance and legislation and insurance and all that fun stuff with my good friend Casey Yarger, Petri Insurance. Thanks for joining me today. You were just, um, you were just down in Trenton at the State House testifying on behalf of all insurance agents and consumers of insurance throughout the state of New Jersey. So I thought it was pretty cool, and I wanted to figure out a time to get you on video or get you in person to really hear a little bit more about your adventure, so to speak, and, uh, and, and learn a little bit more about what, uh, what you did and, and, and, and how you feel about it.
Casey (00:45):
Sounds good. Sounds good. Thank you for having me.
Aaron (00:47):
Yeah. So gimme, gimme a little 90 seconds. Give us a little 90 seconds. Who is Casey Yer and tell me about your agency and, you know, the types of business that you work on.
Casey (00:56):
So I’ve been in the insurance industry about 15 years. A little bit more than that. Uh, I work in a small family agency. I’m a fourth generation insurance brat. Uh, my great-grandfather, uh, originally worked in insurance, uh, in, in Manhattan. And my grandfather opened his first agency in New Brunswick. Uh, we’ve been in Milltown, which is dead center of New Jersey for over 60 years. Um, I predominantly handle commercial accounts, but being a small office, I pretty much have my fingers and hands on a little bit of everything. Um,
Aaron (01:28):
You know how that is.
Casey (01:29):
Absolutely, absolutely. And, uh, yeah, so, uh, I’m a certified insurance counselor, uh, certified risk manager. And, uh, in addition to my advocacy with p i a, um, you know, I guess that’s, that’s, that’s turned me into an insurance expert, so to speak. So this, this wasn’t even my first time testifying down in Trenton. Um, this was my second trip down there to, uh, advocate on behalf of, uh, of all insurance agents in New Jersey and, and consumers in general.
Aaron (01:56):
Right. So, you know, you and I first met when we were coming up through the ranks of the, of the yips, the Young Insurance and Professionals of New Jersey. We sit on committee together at pia, a professional Insurance Agents of New Jersey. Um, and now going through the ranks of p I A on the state level is, is super exciting. You know, so you’ve been heavily involved in our leg reg committee, um, which involves legislative and regulatory issues. And there’s a big issue that we’ve been talking about for, for a couple of years now. And if you go and Google it, you find a, a few articles throughout the country on this issue known as step down. So tell me a little bit about what, what, what does step down mean?
Casey (02:38):
So, a step down provision, it applies to personal auto policies where there’s an instance of a driver, um, being involved in an accident and the coverage limit selected and paid for by the insured is reduced based on some of the verbiage in the policy language. Some of the, the technicalities, um, specific examples would include even though listed your, your daughter who lives away from, from the house and you, you list her as a driver cuz she occasionally drives when she comes home. Uh, if she were involved in an accident, uh, your full coverage limit may not apply. Um, another, uh, instance is, you know, you, you’re driving, uh, your child and another to soccer practice and one of one of their friends and you’re involved in an accident and with an uninsured motorist and, uh, you don’t have enough coverage for your own child. The the third party child that would be in your vehicle would have your full, your full limit, but your own child would not.
Aaron (03:42):
Got it. I mean, another example on the step down is, you know, chil children, drivers Right. Listed on the policy that are then using the vehicle for business purposes also.
Casey (03:54):
Correct? Correct. And you know, I I, I think, I think incidental business purposes, you, you, you take the mail to drop it off at the end of the day from your office and on your way, you’re involved in an accident and all of a sudden your carrier says, no, no, no, no, no. That was, that was a work-related function. Um, you know, or you’re, you’re on your way back from lunch and you stu drop, uh, ID cards off and then a, a client’s house or something like that, or a client’s business. Um, so I I, I think there, there are certain circumstances where a step down is appropriate and, and the state has permitted, um, step downs or complete reduction in coverage when it’s instances of committing a crime or things like that. You know, things, things from a public policy perspective that we would, we would all understand and agree with. But this, this is a, a small caveat within your policy that applies to very specific circumstances, and your average consumer has no idea about something like that in their policy. Even if they read it, it might be confusing to them.
Aaron (04:49):
<laugh>, how many of your clients have actually read their, uh, auto insurance or any insurance policy for that? For that fact?
Casey (04:55):
I could probably count them on one, maybe two hands. And we have a few thousand clients <laugh>.
Aaron (05:00):
So I just changed my auto, um, personally and, uh, I was going through, through my policy. Um, I do not have a step down provision in there. However, there is a, a very bold misrepresentation provision in the policy, uh, which is also big, bad and, and scary, uh, that if you anything that you’re using your vehicle for changes even at renewal, uh, and you don’t let your carrier know about it, you’re misrepresenting how you’re using your vehicle and they can then cancel your automobile insurance policy. So car insurance is scary. It’s not supposed to be, but anyway. Exactly. We’re not going into, uh, in, into that piece of it, you know. So tell me about, uh, being down in Trenton and, and what you were, uh, what you were representing.
Casey (05:44):
So, you know, there, there, there was a bill floating around, uh, it’s bill number a 1761, sponsored by, uh, the chairman of the financial services and insurance committee, uh, assemblyman McKee and going down to Trenton, we were there to advocate on behalf of this legislation. Um, we had some pushback from some of the carriers and ultimately we ended up negotiating with them to come to a compromise, um, that we found was mutual mu mutually beneficial and, and pretty much the intent of what we were trying to accomplish, uh, which is prohibiting these step down provisions. Um, so going down to Trenton, you know, you, you, you, uh, you know, you, you get all the butterflies. It’s a, it, it, it’s a fun thing going down there. You feel like you’re really impacting, um, uh, your society and, and, and your community in a, in a different way. So, so I, uh, uh, along with our lobbyists, uh, from Kat’s Government Affairs and, uh, Brad, our, our in-house counsel, um, we testified on behalf of this legislation mainly we were there to explain it, um, and the, and the intricacies and subtleties of the insurance portion of it to the members of the committee, um, and answer their questions that a, as they may arise. Right? And, and, uh, honestly, I’d say half of the panel asked, asked a question and most of them were very poignant and, and, you know, appropriate.
Aaron (07:05):
Did, did any of them hand you their auto policy and be like, uh, do do I have this in in my coverage <laugh>?
Casey (07:11):
No, but when we, when we start our presentation on this, we’ve done it a few times, uh, whether it’s through Zoom or in individual, uh, assembly offices, right? Um, we usually start with, after this meeting, you’re probably gonna wanna go check your policy and <laugh> a few people look around and you can tell they’re probably going to right. Um, or call their agent,
Aaron (07:28):
Right, or call or or call their agent who might not know about it. And that’s one of the other reasons why you’re doing this is, you know, and on behalf of p i A is to help agents, um, become more aware to then better assist and work with their consumers, right? So
Casey (07:46):
Absolutely know we have to have,
Casey (07:49):
We have to have people that are, that are keeping an eye on, on changes and trends in the industry, um, whether that’s from a regulatory or uh, uh, legislative perspective. Um, and, uh, you know, if we’re not on top of that and communicating that with our, the, the members of BIA and, and just the community at large, there’s, there’s nobody out there. I mean, this isn’t the kind of stuff that makes it into the newspaper that, that you’re actually gonna read or doesn’t show up on, on your, on your normal feeds. Um, even mine, it’s not very
Aaron (08:13):
Sexy insurance nerd.
Casey (08:14):
Even being an insurance nerd, this, this kind of stuff still doesn’t end up on my feeds cuz it’s just not buzzy enough. Right.
Aaron (08:19):
Speaking. No, I agree. And when, you know, when you Google search it, there’s not a whole heck of a lot out there on it. Um, you know, so I don’t know how much case law has been presented about it, but, you know, we know it’s an issue and it’s become an issue. And I’ve seen it in my office with my insureds where it’s actually been enacted. Um, and it, it’s a point of contention, right? You know, for
Casey (08:41):
Absolutely. And it, and it becomes a point of contention between the carrier, the agent and, and that consumer that that individual, um, you know, they, they purchased a policy and, and they didn’t realize necessarily how it applied in, in, in very obscure situations. And, and that that’s, that’s what we really didn’t like about it. It feels like a gotcha, you know, provision. Right? And you, you can’t, you can’t inherently blame the carriers either because once, once the cat’s out of the bag, you know, they all have to have to play catch up and they all have to start introducing these, otherwise they’re, they, they lose their competitive edge, right? So once these are available, everybody’s gonna start using them, but that’s why we go down to Trenton and we try to prevent them from being able to,
Aaron (09:22):
Right. So now, do we think this is gonna get to the governor’s desk to be signed off on? Where do you think this sits right now?
Casey (09:28):
Uh, I believe it is gonna move, um, uh, on the Senate side, I believe, uh, what is it? Uh, Senator Kreen is the one, uh, working on it, on the, on the senate side, and we are expecting this to, to move.
Aaron (09:39):
That’s
Casey (09:40):
Fantastic. Um, so, so the most recent, um, uh, hearing that was held it advanced out of the committee. Um, so, you know, uh, this is something that in 2023 we’ll probably see signed by the governor.
Aaron (09:54):
Okay. I think that’s great. I think it’s beneficial for the consumers. Hopefully there won’t be significant rate that goes along with it, but the carriers have the technology to know who’s really driving the cars and what they’re doing with them and when they’re doing it. I mean, the data’s there. So I think we can, you know, use that data, create a better insurance policy for the consumer that really covers what the consumer expects it to be covering. Right. Um, yep. And then be able to, to, to push forward with, with all of this.
Casey (10:25):
And obviously, you know, rates are a big concern as of January 1st, we’re all gonna have higher rates here in the state of New Jersey for our personal auto by mandate. Mm-hmm. <affirmative>. Um, one nice thing about this legislation, you know, e everybody’s very concerned about increasing premiums moving forward. Uh, you know, gi given we’re, we’re gonna see a jump in that in the next year,
Aaron (10:43):
Right?
Casey (10:44):
Uh, this provi particular provision will not affect anybody who’s already kind of scraping by and has those minimum limits because it, it’s already, they’re already at the minimum limits. There’s nothing to step down to <laugh>, you know? Uh, so a step down provision when you have a minimum limit policy is irrelevant.
Aaron (11:00):
Right. That makes that, that, that makes sense. Um, there’s no, there’s nothing left to step down to, but as good agents, we try to recommend, uh, higher limits to the best of our ability. Um, and when we’re able to to sell it, you know, it’s, it’s great to have agents like yourself, um, that I can rely on and count on and to call and ask questions to. And, you know, for your customers to know that you’re on top of your game, probably significantly more than, uh, than some other agencies right, right down the road. Right. So anybody in absolutely Central Jersey, as Casey puts it, they’re right in the middle. If there is a central jersey that exists, it is at Petri Insurance. Like <laugh> <laugh>, I wanna say. I’m sure you have a map with a, with a pin in it right? That shows exactly, you know, your your right dead center of, uh, of the state.
Casey (11:51):
Absolutely. Absolutely. Yeah. Hub, hub city, hub city is, uh, new Brunswick right next door, and, uh, that’s what it is. It’s the, the hub, the middle of the, the
Aaron (11:58):
State. Right. That’s, that’s awesome. So what other thoughts or comments do you have that you, uh, wanna share on step down or, or any other legislative actions that were, are being worked on right now?
Casey (12:09):
I mean, there, there, there’s always a lot of different things floating around out there. Uh, duty of care has been an issue for agents for, for a very long time in the state of New Jersey. Um, there’s a recent court ruling, uh, that that came out, um, that, uh, uh, from the State Supreme Court, which, which kind of solidifies the position against agents, um, right. Basically that, that we, that we owe a, a very big duty of care to our customers in excess of what a banker or a lawyer might <laugh>. So it is a very difficult position to be in. And so that, that’s probably the next big, uh, uh, agenda item for our committee.
Aaron (12:47):
Okay. I know that’s been worked on in the past and, you know, that’s a concern for myself and my e n O premium that I pay for, for my agency and, and, and yours as well, you know, when we’re held to that standard. Uh, I just had an issue with an insured where, you know, there was multiple non-pay cancellations and they just become a, a, a client, not even a c client at that point. And they’re like, oh, why didn’t I have this coverage? I’m like, what do you mean? You
Casey (13:14):
<laugh> not been canceled
Aaron (13:15):
Six times? I should have fired you a long time ago and now it’s my fault. Right. You know, so right in, in those positions, it, it, it, it becomes, it becomes tough on us. So I’m definitely looking forward to, to what you have coming next to what your committee is working on, to all the great things that PA New Jersey is working on for our member agents, um, both in New York, New Jersey, and our surrounding New England states and, and nationally as well. There’s a lot of great things going on, um, nationally. So if you’re listening to this or already into this, uh, 15th minute, uh, and you’re not a PIA member, you should support the pack and everything that p i a is doing in your local state and on a national level, it’ll make you a better agent and it’ll just make you a truly a better human being all around. So Casey Yer, thank you so much for joining me, and I can’t wait to get this posted up and live, and I’ll see you soon.
Casey (14:07):
Thank you so much, Aaron. Awesome. That was great.
