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					                                                                                      Agenda January | 3

Are You A Member Yet?
LAAA Membership Benefits:                                      THE
1. Strong Leadership
2. Market Information.
3. Networking
4. Education & Seminars.
5. One on One Management
6. Excellent Events.
7. Great Motivational Speakers.
8. Local Monthly Meetings
9. Legislative Representation.    By Andre Urena
10.Trade Show.
11.Qualified Vendors.             The auto insurance party is over. Done. Finished. Anyone who
12.Informative Events.            is still an auto-only shop operating like it’s still 1995 is probably
                                  not reading this because they are out of business. For anyone
 LAAA Meeting Calendar:           who wants to continue selling insurance – auto or otherwise –
                                  there is only one question you need to ask yourself: Are you
 Los Angeles        San Diego     ready to produce professionally?
  02-07-08          02-13-08
                                  I have been saying this for a while now, and people are finally
 Tijuana MX          Las Vegas
                                  listening because we are all feeling the pinch. The nonstandard
  01-15-08           02-20-08
                                  auto market in which a lot of us learned the insurance craft no
Los Angeles        Mexicali       longer has a tolerance for mediocrity, bad customer service, and
03-06-08           02-21-08       half-assed management. The loose underwriting, high commis-
                                  sions, and surplus bad drivers we all relied upon to maintain our
     Visit Our Website for a
    Comprehensive Calendar        businesses are gone.

                                  If you are an owner of an insurance agency, you only have a
                                  handful of options:

                                       •    Make a real commitment to training and innovation.
                                       •    Diversify your products and services.
                                       •    Become an expert in the health, commercial, and/or
                                            life insurance markets.
                                       •    Become technology-savvy and start to sell effectively
                                            on the web.
                                       •    Reduce your staff and expenses and become an owner-
                                            operator permanently.
                                       •    Become an insurance agency franchise or franchisee.
      11819 Valley Blvd
    El Monte, CA 91732                 •    Become a captive agent.
   Phone: (626) 444-0999               •    Quit and go work for a direct writer.
    Fax: (626) 444-2999                •    Sell your agency.
                                  Of course, the alternatives become less palatable as the list con-             tinues. I believe that combining the first four options is the best
4 | Agenda January

chance an independent agency (who wishes to    the Yellow Page lead have all been relegated to
stay independent) has to be profitable. None   the history bin, along with our old two-pound
                                               cell phones and skinny ties. (Actually, skinny
require a massive outlay of capital, and all are
within your reach. The LAAA hosts several      ties have returned, but just as in fashion, busi-
training sessions throughout the year on a     ness innovation is cyclical…and not every idea
variety of topics.                             should come back in style.) The question is
                                               whether you can change with the times for the
We can also advise you on the best way to better.
introduce more variety in your business, both
with the insurance products you sell and the If you still run an auto-only operation, espe-
non-insurance services you offer to raise your cially nonstandard auto only, this advice is
profile within your community. And don’t probably not reaching you because you have
think for a minute that you can’t compete already gone out of business. If your doors are
with the direct writers on the web. The Inter- still open, count your blessings, because they
net has become the great business equalizer. won’t be for much longer. Look at the list
You can be as big or as small as your imagina- above and decide what you want to do. I hope
tion. By and large, web pages (and visitors) you will choose the first options and bring a
don’t discern between a one or two person new-found outlook to your business. Get mo-
operation and a Fortune 500 company. Find tivated!
your e-niche and grow your business.

The fact is that there is no more low hanging Good luck to everybody in 2008 and re-
fruit left. The easy sale, the walk-in customer, member that the LAAA is here to help!
6 | Agenda January

A Word from the President

          s this is the first month of 2008 and   approach me or any of our board mem-
          the year is just getting started, I     bers to share your ideas.
          am going to keep this column
                                                  On a personal note, I am looking forward
          short. I’ve already discussed the
                                                  to continue to contribute as much as I can
wonderful things that we developed
                                                  to keep our association growing, and well
throughout 2007, and 2008 is already
                                                  as maintain our leadership position within
shaping up to be another stellar year for
                                                  the industry. Hopefully we can add some
the LAAA. It will definitely NOT be an excep-
                                                  new chapters in even more states and be
tion to our annual success.
                                                  the best agents organization in the U.S. I
The Board is already hard at work develop-        am not exaggerating when I say that I truly
ing events for the New Year.                                    believe we have what it takes
We are starting out with an                                     to become a national
excellent Life Insurance                                        player. At this point in my life,
workshop, partnering with                                       I do not think there is any-
Allianz. The seminar will be                                    thing impossible.
held prior to our Los Angeles                                   If we work together; support
meeting on January 10th,                                        each other and really set our
and what better way to start                                    minds to it, we will continue
the year? Learning new ways                                     to evolve and become more
to increase our profitability to                                prosperous professionals and
better serve our valued cus-                                    better people.
tomers through solid educa-
tional programs is what the                                     I hope you all have set your
association is all about. Op-                                   personal and professional
portunity plus Motivation                                       goals for this new year. Now
equals Success!                                                 work towards achieving the
                                                  success you are looking for. Make life chal-
We are already about midway through               lenging, exciting, and of course, fun. Keep
planning for our 2008 annual convention,          in mind that a life without goals and/or
which is returning to the Long Beach Ren-         direction quickly becomes boring, nega-
aissance Hotel and adjacent Long Beach            tive, and unproductive.
Convention Center. Be on the lookout for
details soon. Naturally, we invite every LAAA     I am going to leave you all with this quote:
member to get involved to the extent they         “goals are dreams with deadlines.” Go for
are able. Shoot us some ideas for speak-          it and meet your deadlines!
ers, events, seminars, etc. If you have any
suggestions for new vendors and/or spon-
sors, please call (626-444-0999) or e-mail                          By Gustavo Contreras
( us. Feel free to                                   LAAA President
Magazine Staff:                             Contributing Writers For This Issue:
Editor in Chief - Andre Urena               Stephen Santoro - Santoro & Associates
LAAA President - Gustavo Contreras          Larry Powers - Insurance Educator
Managing Editor - Don Lukenbill             Jim Lehmann - Innovative Market Strategies
Art Director - Carlos Gil                   Raymond Fernandez - Victoria Insurance
Advertising - Alvaro Urena                  Deane Silke - Fiesta Insurance Franchise Corp.
Business Dev. Dir. - Rafael Hurtado         Juan A. Torres - Music, Peeler & Garret LLP.
                                            Terry Brock - Achievement Systems
The opinions expressed by Agenda columnists are theirs alone and do not necessarily reflect those
of the Latin American Agents Association, its Board of Directors or membership at large.
8 | Agenda January

           omeone once told me that the heart of             failure. It is not prudent to rush into troubles, but it is
           every problem is, in fact, the heart.             to meet them halfway in order to conquer them.
           Obvious to be sure, but it also begs the
           question “where is your heart?” It is quite       Here are some thoughts that I have found to be
 interesting for me to note that in over 15 years in         quite helpful in all endeavors – both in business and
 insurance, I have seen the best and the worst in the        in life:
 business, running the gamut from small mom and
 pop operations to 30+ office mega-agencies. What               • People are illogical ,unreasonable, and self
 the true successes – on all levels – have in                       centered. Love them anyway.
 common is that the business of insurance is on                 • If you do good, people will accuse you of
 their hearts and souls. The question of whether or                 selfish ulterior motives. Do good anyway.
 not you will be successful depends on the desire in            • If you are successful, you will win false friends
 your heart.                                                        and true enemies. Succeed anyway.
                                                                • The good you today will be forgotten
 As I write this article in late December, I am on                  tomorrow. Do good anyway.
 vacation. As with most of us, I am taking the                  • Honesty and frankness make you vulnerable.
 opportunity at the end of the year to reflect; to                  Be honest and frank anyway.
 assess my triumphs and learn from my defeats.                  • The biggest men and women with the biggest
 This time of the year is an excellent time for all of              ideas can be shot down by the smallest men
 us to not simply make “resolutions,” but a firm                    and women with the smallest minds. Think big
 commitment to strive for nothing less than the very                anyway.
 best.                                                          •   People favor underdogs but follow only top
                                                                    dogs. Fight for a few underdogs anyway.
 Instead of writing about insurance, what I would like          •   What you spend years building may be
 to do is to leave you with some thought-provoking                  destroyed overnight. Build anyway.
 words that will help create imagery to help you                •   People really need help but may attack you if
 balance the desires of your heart and the                          you help them. Help people anyway.
 aggressive passion of your mind. Always ask                    •   Give people the best you have and you'll get
 yourself “are my desires about serving and                         kicked in the teeth. Give the world the best
 following the golden rule?” Or are your thoughts                   you have anyway.
 more like “its all about me, survival of the fittest, all
 is fair, in love , business and war, etc.” Look at          As I leave this final column of 2007 to enjoy the
 yourself in the mirror and knowing everything you           remainder of the holidays, I want to thank you for
 know about yourself, would you buy insurance…               being you. You serve a greater purpose, and that
 from you? Why or why not?                                   purpose is to INSURE that your business, friends,
                                                             associates, and most importantly family, are taken
 Trust your heart. especially when it is a strong one.       care of. What you do matters, and at the end of the
 Never contradict it, for usually it can predict the         day, you need heart to accomplish that. Remember
 things that matter most. It is homegrown oracle.            that sometimes what the heart knows the head
 Many perished from what they have feared, but               forgets. As the new year dawns on us, let’s make
 what good was fearing when they took no steps to            sure that we have both in balance.
 prevent it? Some people have a very loyal heart,
 given to them by nature, which always forewarns May you and the ones you love have a wonderful
 them , and sounds the alarm, saving them from New Year.
10 | Agenda January

The Market

                                       “What is a ‘soft market’…”
                                       By Deane Silke, CPCU, API, AIS
                                          Fiesta Insurance Franchise Corp.

              he word “soft market” pops up in conversation anytime insurance industry profes-
              sionals are discussing the state of affairs in the current marketplace. The term is
              commonly used as a global description to describe what many feel is the “tough
              times” we experience. But what does the term “soft market” really mean?

       I have worked in the P&C insurance industry for 20 years, and as many times as I have
       heard the term “soft market” used in conversation, you would think we live in a per-
       petually soft market. Many of us who have worked in this industry for a long time can
       remember a time when you could forecast the business cycles of the P&C insurance
       industry with a reasonable amount of certainty. Those days, my friends, are long gone.

       Like every other business in existence, the insurance industry operates in cycles. Those
       cycles are driven and influenced by many factors, both internal and external to the
       industry. Which direction the insurance industry will move in its cycle, soft or hard, is
       largely driven by which factors are present and which ones are having the most influ-
       ence on the market.

       The first thing we need to clear up is the question of what exactly is a “soft market”. It
       can best be described as a period in the market in which there is little demand and
       an excess of supply, creating downward pressure on prices. More people want to sell
       insurance than want to buy it.

       Here is an example of how a “soft market” is created: Every year the insurance carriers
       set their premium volume goals for the year, and then they begin to market their prod-
       uct to all of the potential customers within a given market or territory. A problem arises
       when the premium volume goals set by the insurance carriers exceed the amount of
       insurance desired by all of the potential customers within that given market or territory.
       Some of those insurance carriers will begin to fall short of their goals, so they will make
       the decision to lower their rates below the rest of the market in order to attract more
       customers. Ultimately, this will cause the other carriers to follow suit or risk failing to
       meet their goals. The result is a nasty downward spiral of rates. This lack of potential
       customers to buy insurance products and the downward pressure it causes on rates
       can initiate the beginning of a “soft market”.
12 | Agenda January

The factors that create a “soft market” can       your carriers take a rate decrease, under-
come from within the insurance industry, or       stand that they just took money out of your
they can be external to the industry alto-        pocket in the form of the commissions you
gether. Internal factors are things like rate     earn on the business you place with them.
regulations, changes in law (i.e., Prop. 103)     Stay away from the carriers who will do any-
or an influx of new competitors in the market     thing to get your business. By the same to-
when the barriers of entry are removed. In        ken, respect your own business enough to
the mid 80s, the formation of offshore cap-       not violate any insurance regulations or
tives took on momentum. In the late 80s           break any laws just to write a policy.
and early 90s, the non-admitted carriers
were stealing a ton of business from the       The old saying, “What goes around, comes
admitted carriers (due mainly to a total lack  around” holds just as true in the insurance
of regulation of the rate levels and surplus ofindustry as it does anywhere else. Keep your
                                               eye on the long term goals of your business,
                                                                                and don’t make
  The factors that create a “soft market” can                                   stupid business
  come from within the insurance industry,                                      decisions   be-
                                                                                cause of what is
these non-admitted carriers). Today, Ber-      happening in the market today. I have
muda is the world’s biggest Mecca of finan-    watched many brokers make BIG money for
cial capital and insurance markets. The abil-  a short amount of time because they sold
ity of the markets in Bermuda to raise almost  only the carriers with the “low-ball” rates and
unlimited amounts of capital for new and       looked the other way when it came to un-
existing insurance markets has created an      derwriting a risk. Most of those carriers, and
entirely new portal for emerging markets       the brokers who sold policies for them, are
and carriers in the insurance industry.        no longer in business today. These are facts
                                               out of my experience, and many of you can
The wildcard factors that can create a “soft   confirm these facts out of your own experi-
market” are those that are created outside     ence.
of the insurance industry. External factors
can be things like unexpected rising interest  So what does all of this mean? It means that
rates, the crash of high risk mortgage portfo- certain factors and forces will sometimes
lios, the price of gas going up to $100+ per   come together and combine to create the
barrel, increasing unemployment rates, the     beginning of a “soft market”, and the market
terrorist attacks on the World Trade Center,   will continue to soften until it reaches a point
declaration      of
war by our coun-             the market will continue to soften until it
try and poor             reaches a point where carriers and brokers
investment per-
formance in the                                                   are losing money
stocks        and
bonds markets. We serve the citizens in the    where carriers and brokers are losing money.
cities and communities that we conduct our     At this point, new factors and forces will
business, so anything that affects those peo-  come together to counteract the “soft mar-
ple or those communities has the potential     ket”, and we will begin to move towards a
to affect our business.                        “hard market”. But that is a topic for another
The big question is, what can we do about a
“soft market”? The short answer is nothing.    I hope that I have been able to give you
However, you can do a few things to try to     some new information about what a “soft
minimize the effects that a “soft market” can  market” truly is, what creates it and how to
have on your business. Pay attention to the    deal with it. We can never stop the cycles
underwriting standards, pricing decisions      that occur in the insurance industry, but it
and financial strength of the carriers you     sure makes it easier to go through them
choose to place your business. Every time      when you know what they are all about.
14 | Agenda January

The Powers Point of View

        is not a get rich quick scheme
                                       By Larry Powers

               ecently, we have had several            our average policy premium was $58,000. It
               insurance pogues tell us how we can     took seven years to get there, along with five
               get rich selling life insurance. I am   years of insurance education, and lots of shoe
               going to reserve comment on the         leather. My partner and I worked as a team and
 companies represented, because they just happen       associated with brokers who worked large
 to be very good at what they do, and would            accounts. We were turned down more times
 certainly be assets to any life agent.                than a hotel blanket. But we learned and became
                                                       rather successful. We were also lucky.
 Note: Life is different from F&C as you don’t need
 an appointment initially to sell the product (for I have also written multi million dollar life
 most life companies). Any Life Agent can sell them, policies with big premiums and commissions. I
 with the proper license.                            could do so because I had the large accounts.
                                                     Successful people like to associate with success-
 My comments are about the typical life agents ful people. Large life insurance sales -- and
 parading before us behind the podium. Life when I say “life insurance” I mean all life
 insurance is not a get rich quick scheme. It is far products, including annuities -- often involve
 too important than that. I recall one dude attorneys and CPAs. If you are not a ChFP/
 bragging about making over $100,000 on one CLU you probably won’t get a shot.
 sale. Even if that is true (and he did not
 elaborate enough to prove it), it is not an every I believe that if you try to sell people product
 day event. His suit was not that of an agent who based on your commissions you will lose more
 sells those policies regularly.                     than win. The customer’s needs are what is
                                                     important. If your approach with a customer is
 Most of you sell mainly auto insurance. How based on their needs and desires, they will
 often do you see the 20 year old driving a usually listen. Even if they don’t like what you
 $695,000 Bentley with a MVR that would are saying, they will probably not cut you off.
 choke a caballo and a $25,000 premium? They
 are out there and brokers are writing them. But I would much rather you concentrate first on
 if you chase them, I predict you will soon be chasing Sancho/Sancha out of Latino minds. (By
 selling shoes. There are big dollars in the life the way he/she lives as Jody in the gringo mind).
 market, to be sure. However, you need skills to Do the right thing by your customer always and
 find them and be a success.                         the commissions will come to you. Eventually
                                                     you will get lucky and sell a large account. Just
 Many of you know that I used to work the big remember that luck usually follows lots of
 account F&C/Life field. For over three years, honest work.
16 | Agenda January

               elationship Marketing is most important     The sooner you can ID this by their words, their
               for successful marketers and businesspeo-   willingness to work with you on even small items and
               ple. You are marketing yourself no mat-     be kind, the better off you'll be.
               ter what kind of job or position you
 hold. It is the mark of successful people to rise above   Always be Professional
 limitations and inhibiting factors which would hold       When you find the weedy people, remember it is
 back less successful followers.                           imperative for you as a successful businessperson to
                                                           never stoop to the level of name-calling, and belittling
 Weeds inhibit growth in farming. They grow around         the person. Too much is done today attacking the
 your crops and sap energy and life from the growing       person, not the action. This ad hominem (or "arguing
 plant. It is a regular part of farming to eradicate the   to the man") approach doesn't solve the problem. It
 weeds and in Relationship Farming you have to apply       only creates friction. Focus on the solution--- not
 the same principles to grow your business.                cutting down the person--- and you'll achieve much
                                                           more success.
 There are what I call "weedy people" out there. You
 know who I'm talking about. These are the people     Eradicate Weeds from Your Business
 that try to sap your energy, your time, your money   When you identify time-wasters, profit-takers and
 and all the good that you do. Some do it consciously others who only hurt your business, do what you can
 trying to harm you. Most will do it without even     to eliminate them. Much like in firing an employee, it
 thinking about how they are hurting you. That is why is best to identify the person who "should be encour-
 you, as a successful Relationship Farmer, have to be on
                                                      aged to be successful somewhere else" and help that
 the lookout for those who would inhibit your success.person move along. Don't waste your most precious
                                                      resource--- time--- with people who drain you of your
 It is most important to be careful when doing your time, money and efforts.
 Relationship Farming weeding. Those who are weeds
 today can become viable paying customers later on (I
 know, the analogy breaks down here). A good rule of A farmer has to diligently cultivate the soil and watch
 thumb I've found is to always treat everyone profes- out for weeds which sap the life of plants. Proper
 sionally and graciously, no matter who they are and spraying can help prevent weeds from growing. It is
 what they've done. Even if they are a weed, you re- critical to have proper plans for your business and
 main professional in all your own actions and words. your mind-set on how to deal with weeds when you
                                                      see them.
 Here are some steps that can help as you encounter
 weeds in your own Relationship Farming:                 Be a good Relationship Farmer and prepare in advance
                                                         for weeds. It will help your harvest be stronger and
 Identify the Weeds Early                                much richer.
 If a weed grows for a long time, it saps the poor grow-
 ing plant of vital nutrients. Have a built-in "early Terry Brock owns Achievement Systems in Orlando. If
 detection system" to ID the weeds in your business. you have comments about this column, you can send them
 Watch for those that are takers and don't believe in by e-mail to or phone him at 407-
 value-for-value relationship. If all they want to do it 363-0505. For more innovative tips and columns about
 take, you don't want to hang around them.               marketing, visit Terry’s website at
18 | Agenda January

                                                             and I figured this would give me some financial
                                                             stability. They hired me without having any auto
                                                             insurance background for their Huntington Beach
                                                             office. Although there weren’t worried about it, I got
                                                             licensed shortly thereafter, and soon was promoted to
                                                             branch manager of their Irvine office.

                                                             At the time. FGS was the “King of the Hill,” with a
                                                             lot of TV and radio advertising and little or no com-
                                                             petition. They were doing it right and would have

               elly Turton has been a presence in the        most likely been the biggest broker by far today.
               insurance community for over two              However, after about three years I began to notice
               decades, most notably as the former           that things were changing, and not for the better. I
               owner of Freeway Insurance. Well              voiced my concerns , which was not well received. I
 known for it’s radio and television advertisements          left the company and joined AIS, which only lasted
 advising potential customers that Freeway was “that         six months due to my father’s passing, leaving me in
 thing you’re speeding on,”                                  charge of his estate. (Side note: FGS lost whatever
                                                             made them “King of the Hill” and went out of busi-
 Turton sold his agency to focus his full-time atten-        ness several years later.)
 tion on Wizard Lizard, a new business venture dedi-
 cated to creating innovative Internet insurance sales       By 1987, I had two kids and thought that, if others
 products to help producers stay ahead of the game.          could make it in auto insurance, so could I. I took a
 He says he’s convinced that is the direction the insur-     leap of faith and started Freeway Insurance.
 ance business is taking and he wants to be on the
 “ground floor of the revolution.”                           Q: Freeway Insurance was well-known, especially in
                                                             Southern California, for its creativity and professional-
 Long a supporter of the Latin American Agents               ism and it appeared as though things were going great.
 Association, Turton is a fixture at the association’s       Why sell?
 LA meetings, at the convention, as well as most
 special events. Now having experienced success both         A: Although things were good overall, we had both
 from the agency and company side, we decided to             good and bad days, and I simply grew tired of it.
 find out where he is coming from, and where he’s            After 20 years, it became repetitive and I couldn’t see
 heading.                                                    myself doing the same old thing day in and day out
                                                             until I reached my grave. I was at a stage of my life
 Q: First, tell us a little about yourself and how you got   where I needed something more exciting to do.
 into the insurance business.
                                                             Q: Broker fees have been a bone of contention between
 A: In 1983, I stumbled across a job listing from FGS        producers, consumer groups and the Department of
 looking for an auto insurance sales. I was married,         Insurance for years. What was the policy at Freeway and
 but with no formal education or real career direction,      how do you feel about broker fees now?
                                                                                                   Agenda January | 19

A: Our policy was to be reasonable, and when I sold           much money I really had. I always felt that the biggest
Freeway, I believe our average broker fee was around          challenge was to make the phone ring. After all, I had
$98. Sadly, abuses by a few rotten apples have now            to talk to someone before I could sell them. Experi-
spoiled it for everyone.                                      ment to find out what works.

I remember seeing the first signs of $500-$1,000 bro-         Q: The insurance industry has benefited from some inven-
ker fees in the late 1980’s and early 1990’s. A compet-       tive business solutions introduced over the past few years.
ing broker would lie or lowball a price over the phone        Still, some have lamented a lack of innovation in insur-
just to get a customer to drive to their office. Then         ance products. Where do you stand on the subject and
once the customer showed up, the broker would have            why?
some well rehearsed story explaining why the price was
higher. The customer would either believe the story or        Although rating engines, agency management systems,
just buy because it was easier than starting the shop-        electronic binding and instant MVRs have provided
ping process all over again. It has been an effective way     business conveniences for producers to use, there has
for certain brokers to fleece unsuspecting customers,         been little innovation to make buying from a producer
and it was only a matter of time until consumers and          more convenient for the customer. Customers, in
the DOI recognized it as abusive.                             most cases, are still required to pack up the kids and
                                                              dog and come to an office or hassle with the shortcom-
It’s too bad that the abusers can’t compete on an even        ings of a fax machine in order to complete an auto
playing field, because they will suffer as well if broker     insurance purchase. Innovation has given the producer
fees are restricted or outlawed. But I guess they have a      a Cadillac to drive to run his business but the customer
“live for today” business philosophy.                         is still stuck driving a Model T when completing an
                                                              auto insurance sale. That is backwards if you’re look-
Q: Now that you’re on the “company” side of the business,     ing to attract new customers this day and age.
as opposed to the retail end, has your perspective changed?
                                                              Q: With more companies (and agencies) offering complete
A: I used to see it as more as “every man for himself”        insurance transactions online – from quote to binding –
or everyone doing their own thing. Now I see that             will walk-in customers soon be a thing of the past?
many producers struggle with the same challenges, and
most producers want to do a good job. But many                A: I think if you were to ask the average person if they
don’t know how to do it or are unsure of what to do to        would prefer to buy auto insurance online within 15
improve their business.                                       minutes or drive to an office to buy, the vast majority
                                                              would choose the online method. Whether it’s buying
Q: Describe the perfect insurance market, both from the       Christmas gifts, music, banking, paying bills or even
retail and company sides.                                     ordering food, retailers are reaching out to customers
                                                              in order to make it convenient to buy. Insurance is not
A: Well, perfect on the retail side would be the phone        the exception to this change. It is just the last to join
ringing off the hook and tons of email sales inquiries.       the party.
From a company (carrier) side it would naturally be
increased sales and retention with low loss results. But      There may be some old fashioned hold outs, but as the
none of that is realistic. A good market would be a           kids of the internet generation come of age, the walk
stable one where there are less swings between the hard       in business will diminish more rapidly. However, the
and soft market conditions.                                   good news is that most customers still want to deal
                                                              with agents when it comes to buying auto insurance.
Q: What advice would you give a producer just starting        At the same time customers are seeking out those who
out?                                                          will make it the easiest for them to complete the pur-
                                                              chase and that is what EZBuy was designed to do.
A: First of all, it takes hard work and commitment. If
you are not willing to do what it takes, aside from           Q: What is EZBuy all about?
cheating people, then don’t bother. Also, you need to
have three senses: Money Sense, Business Sense and            A: EZBuy is about making the selling of auto insur-
Common Sense. Too often, a new producer will open             ance a convenient and easy online process for the
their doors and think that’s all there is to it or that all   producer and customer. It is the first product offered
the money in the trust account is theirs. I was the last      by my new software company, Wizard Lizard, LLC.
to get paid, so I wasn’t kidding myself about how             It all began when I wanted to develop a new way to
20 | Agenda January

acquire more auto insurance sales at Freeway Insur-        it is doubtful they will come up with a replacement for
ance. The first project was a website called FAST          the good old-fashioned associations.
where a customer could log on, get prices, select a
carrier and have a video spokesperson walk onto their      Q: EZBuy was recently presented with the LAAA’s Valor
computer screen and guide them through an auto             Award for “vendor of the year.” Discuss how you became
insurance application online. Once the application was     involved with the LAAA and your thoughts on being a
complete, it could be submitted. It was kind of like an    Valor Award recipient.
online Robo Agent and the process worked very well.
                                                           A: Well, first I would like to thank the LAAA for this
                                                           award. It is very gratifying and humbling that an or-
However, we found that our online leads did not turn
                                                           ganization such as the LAAA would recognize what we
into more online sales with the FAST system. Custom-
                                                           are trying to achieve in bringing something of value to
ers wanted to buy online but wanted to interact with a
live producer at the same time for assistance. So we
went back to the drawing board and developed EZ-
                                                           As for involvement in the LAAA, I knew Andre back
Buy. This allowed our producers to close and complete
                                                           in the days when he worked for Ron Katz and we were
a sale while on a quote call and stop a customer from
                                                           both pretty green. Andre had mentioned something
shopping any further. We released EZBuy at Freeway
                                                           about having a vision for a Latin association when we
in January of 2006, and it’s potential has far outgrown
                                                           were poolside in Palm Springs several years ago. Al-
it’s initial application.
                                                           though I don’t think I took him seriously at the time,
                                                           it made total sense that we become supporters of it as
Q: Do you believe that EZBuy will help level the playing   Freeway Insurance and now with EZBuy.
field between independent agents and direct writers? How
so?                                                        Q: You have an obvious respect for our association, a
                                                           feeling that is mutual, and have been a big supporter over
A: EZBuy can give the agent an advantage over a direct     the years. What direction would you like to see the LAAA
carrier because it is easier for the customer to use.      take in the next few years?
Unlike a direct carrier’s website that requires a cus-
tomer to fill in a lot of information, EZBuy only re-      A: 2008 is poised to be a critical year because many
quires that a few answers be clicked and that’s it. An-    things seem to be reaching a boiling point. Broker fees,
other advantage is that direct carriers lack variety and   agent vs. broker designations, and the threat of direct
sell only one program online. An agent can sell many       carriers is on everybody’s radar screen. As a result, the
different carriers online through EZBuy and have their     LAAA should continue keeping retail producers well
own agency forms completed as well.                        informed of the ongoing status of these issues and
                                                           advocate the best interest of the membership. Addi-
I bought a policy online from Progressive Direct for       tionally, the LAAA should continue to explore new
my 21 year old son and it took me 45 minutes. An           and better ways to help producers survive and thrive in
EZBuy sale can be completed within 15 minutes.             the coming years.
There’s very little for the producer to learn, making
EZBuy part of the normal sales routine. Let’s face it,     Q: If you could travel back ten years and talk to Kelly
buying and selling over the Internet is more than a        Turton, what would you tell him?
trend, it is here to stay. EZBuy allows the agent to
remain competitive.                                        A: From a business standpoint it would be “don’t rest
                                                           on your current success and stay on top of the trends
                                                           and changes in the industry.” That’s because things are
Q: Where do associations, such as the Latin American
                                                           always changing and I think that I may have missed
Agents Association, fit in to the agency of the future?
                                                           some opportunities because I was too comfortable.

A: Like the lyrics go in an old Bob Dylan song, “ The       Q: What drives you to succeed, both personally and
times, they are a changin’ ” and associations like the     professionally?
LAAA are critical in keeping producers informed of
those changes. Plus there is always strength in numbers    A: The fear of failure. That’s not to say that failure is
and associations like the LAAA can rally the troops        always a bad thing because we can all learn from fail-
into one voice impacting the outcome of our concerns       ures. But I tend to sleep better at night with fewer
and interests. The future may be getting high tech but     marks in the failure column.
22 | Agenda January

     Company partners provide much needed support at events throughout the year

                      By Rafael Hurtado, LAAA Business Development Director

                    ost people enjoying themselves at     the rest is their demonstrated dedication to our
                    an LAAA event likely don’t            association and what we stand for: Helping produc-
                    realize the hard work that goes in    ers serving the Latino community grow and prosper.
                    to planning one successful
 gathering after another. The LAAA staff and Board        Sure, the Latino market is hot right now, and is
 does a fantastic job of planning and executing every-    poised to explode even further. There have been
 thing from our monthly chapter meetings to our           numerous companies jumping on the bandwagon
 annual convention, and most recently our Holiday         and trying to make inroads. Some choose to
 Gala. Another group of LAAA supporters, without          attempt direct marketing campaigns, hoping to
 whom our events would be considerably less than          capitalize on this “suddenly” desirable customer
 what they are now, maybe even non-existent.              base. Still others have contacted the LAAA and are
                                                          utilizing our vast network of community-based
 The Holiday Gala and Valor Awards, held last             members to earn their piece of the pie. Naturally,
 month in Glendale, was a textbook case of                we believe that the best and most efficient way to
 cooperation between the LAAA and our company             capture part of the Latino market is by going
 partners. A highlight of the evening was                 though the insurance professionals who have built
 recognizing those carriers, GA’s and vendors who         trust in confidence within Latino neighborhoods.
 have made a significant difference in the business
 lives of many insurance producers. Although special      The LAAA is pleased to have created relationships
 thanks were given to the evening’s sponsors, I would     these companies and look forward to guiding them
 like to take a minute to offer our gratitude to the      toward the best strategy for providing quality insur-
 Holiday Gala sponsors, as well as those companies        ance products and excellent service to our members,
 who have already stepped up for our convention,          and ultimately, their customers. But I am also tak-
 meetings, and seminars.                                  ing note of those companies who have been long-
                                                          time LAAA supporters, standing with us as we took
 For last month’s festivities, we can (and should) all    our first steps as an advocacy association. From the
 thank the following companies for their generous         first meeting in Los Angeles back in 1998 all the
 support: Quadrant, FSC Insurance Solutions,              way through our first growth spurts, they are still
 Access General Insurance Company, AIG, Infinity,         supporting our cause as we create an even bigger
 Kaiser Permanente, GMAC Insurance, Safeco,               profile throughout the Southwestern U.S. and
 Allied Insurance, Bristol West Insurance Group,          Northern Mexico.
 Arrowhead General Insurance, AIG Agency Auto,
 Auto International Mexico Insurance, Western             In order to create a successful business climate, you
 General, Unitrin Specialty, Alliance United              need cooperation between companies and
 Insurance Company, Yates & Associates and                producers. The LAAA is proud to fill that need by
 AMISI Mexico Insurance. Thanks to them, the              opening doors on both sides, and serving as
 Holiday Gala was one of our best ever. I would like      mediator between these two important groups. In
 to remind everyone to remember which                     the big picture, it is this equilibrium that helps us all
 companies are there for the LAAA when we need            become better professionals.
                                                          Our members are most definitely the association’s
 As I scroll down the list of past sponsors, as well as   biggest asset. We never forget that. In addition, we
 those companies already committed to supporting          could not offer the business tools we strive to
 the LAAA in 2008, I am noticing the same names           provide our members without our company
 over and over. What separates these companies from       partners. The LAAA is pleased to have both.
24 | Agenda January

                 By Juan A. Torres, Esq.

                      hat could happen if an
                      insurance broker fails to
                      advise a business client in
                      California    to     obtain
 workers’ compensation insurance coverage?
 The answer provided in a recent lawsuit was a
 judgment of almost $6 million against the              against the Plaintiffs jointly with their Rhino
 broker. This judgment stands for the proposition       Linings dealership. The dealership’s general liabil-
 that if an insurance broker markets himself or         ity insurance coverage carrier paid $1 million of
 herself as an expert, the broker heightens its duty    the judgment against the Plaintiffs and their
 of care to a client.                                   dealership. In their lawsuit against the insurance
 The Plaintiffs in this lawsuit were two individuals    broker to recover the balance of the judgment
 who purchased a Rhino Linings, USA dealership          against them, the Plaintiffs alleged that the broker
 in Santa Fe Springs, California. Rhino Linings’        breached her duty of care owed to them because
 business is the application of a polyurethane lining   she did not advise them to obtain workers’
 on pick-up truck beds. The Plaintiffs consulted        compensation insurance coverage. Part of the
 with an insurance broker to handle their               broker’s defense was that she had orally advised
 dealership’s insurance needs. This broker sold to      one of the Plaintiffs about such coverage, but that
 Plaintiffs an insurance package she developed and      he had declined the coverage.
 specifically marketed and sold to Rhino Linings
 dealers throughout the United States.                  In its ruling in favor of the Plaintiffs, the court
 Unbeknownst to the Plaintiffs, the package did         determined that the broker’s assertion that she
 not include workers’ compensation insurance            had advised one of the Plaintiffs about workers’
 coverage, which is legally required for any business   compensation insurance coverage was not
 in California with at least one employee.              credible, particularly because the broker did not
                                                        prepare a written record of her alleged communi-
 A fire occurred at the Plaintiffs’ Rhino Linings       cation.     According to the court, it “taxes
 dealership resulting in severe injuries to an em-      credibility, and plain common sense expectation
 ployee. In his personal injury lawsuit, the em-        of business practice under the circumstances, that
 ployee obtained a judgment of almost $11.3 mil-        no written record of even minimum formality
 lion, approximately $6 million of which was            exists by [the broker] documenting
                                                                                            Agenda January | 25

considerations, discussions, advisements, or              his insurance needs, particularly where such needs
Plaintiff’s alleged declination relating to workers’      have been brought to the agent’s attention.”
compensation insurance for Plaintiffs’” dealership.       According to the court, the broker’s “duty to advise
                                                          Plaintiffs of the need for workers’ compensation
The court concluded that the broker breached her          insurance would be significant as this coverage is
duty of care by failing “to advise, counsel and/or at     required by law, not optional.”
the very least to discuss and document information
relative to workers’ compensation insurance which         The lessons to be learned from this case by
was statutorily required for the Plaintiffs’ dealership   insurance brokers include:           1) Take extra
operation.” The court based this conclusion on its        precautionary measures in advising clients about
reasoning that the broker held herself out as an          their insurance coverage needs when you hold
expert by marketing and selling to Rhino Linings          yourself out as having special or expert knowledge,
dealerships the insurance program she developed,          2) Document discussions with clients concerning
which lead “Plaintiffs to reasonably assume that the      advise given about their insurance coverage needs,
broker was an expert in the insurance coverage they       particularly when the clients decline to follow the
needed and therefore justifiably “relied on her in        advise, and 3) Document the scope of work or
the belief they were offered an insurance ‘package’       services that you are hired to perform.
tailored to Rhino dealerships.”
                                                          Juan A. Torres is a Partner in the Litigation Group of
By holding herself out as an expert, the broker           the law firm Musick, Peeler & Garrett LLP in Los
assumed a duty of care to Plaintiffs that was higher      Angeles. His practice includes commercial and
than the standard applicable duty “to use                 insurance defense matters, which includes the
reasonable care, diligence and judgment in                representation of insurance brokers and other
representing his or her client.” The court further        professionals. He is fluent in Spanish. Mr. Torres can
relied on the law in California imposing a “special       be reached at (213) 629-7873 or by e-mail at
duty” on an insurance agent when he or she “holds
himself or herself out to be more than an “ordinary
agent.” The court explained that an agent who             This is for general informational purposes only. It is
holds himself or herself out “as a consultant and         not intended as professional legal counsel and should
counselor” has “a duty to advise the insured as to        not be utilized as such.

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              "Not All Latinos Are The Same," Which Ethnicity,
                 Nationality, Demography, Do You Serve?"
26 | Agenda January

      GALA AND
         Association’s 2007
          event now in the
             history books

          anta Claus (or at least his brother,
          Andre) came to town at the recent
          LAAA Holiday Gala and Valor
          Awards, held December 8th at
 Sabor Restaurant in Glendale. From the
 welcoming “art deco” Christmas trees and
 free photo op with the Big Man himself, a
 who’s who of the insurance industry gathered
 for a holiday season kick-off that could only be        While the audience was finishing up their dinners,
 described as vintage LAAA.                              the “serious” portion of the evening began. LAAA
                                                         Founder & CEO Andre Urena officially welcomed
 The SRO crowd was greeted with Salsa music              the crowd to the event. He thanked the sponsors for
 pumping through the sound system, a “Cuban              their generous support, commenting that none of
 fusion” buffet and plenty of friends and colleagues     evening’s festivities would have been possible with-
 to put them in the holiday spirit. While the stars of   out them. “In fact, our company partners are inte-
 the evening were the Valor Awards recipients – and      gral to the success of all LAAA functions – monthly
 deservedly so – everyone was welcome and all went       meetings, our annual convention, and other associa-
 away with smiles on their faces.                        tion activities throughout the year,” Urena noted.
 People kept coming in well past the 7:00 pm start       Urena then relinquished the microphone to LAAA
 time, and those who missed the buffet were still able   President Gustavo Contreras to began the Valor
 to enjoy great drinks (including some dynamite          Award presentations. Contreras expressed his grati-
 mojitos) and cheer on the Valor Awards honorees.        tude to the LAAA Board and staff, as well as to
 The annual awards were established by the LAAA          Urena, and the membership at large, for the strong
 several years ago to publicly recognize those insur-    support he has received during his first year in the
 ance professionals, well-known to everyone associ-      LAAA’s top office. He also thanked his wife and
 ated with insurance, who truly go above and beyond      parents, who were in attendance, for their guidance
 the call of duty. Their motivation is not accolades,    and patience, sentiments that became a common
 but simply a desire to advance the insurance indus-     theme for the presenters.
 try, particularly the frontline agents and brokers.
 The LAAA recognizes that there are few accolades        “The 2007 Gala Awards are the real deal, given by
 like the Valor Awards, and is intent that deserving     active LAAA members -- not just the Board and/or
 industry superstars received a well-earned pat on the   insurance companies. In order to win, or at least be
 pack for their contributions.                           nominated, for next year's awards, people need to
                                                                                               Agenda January | 27

get involved, participate and support the association      his tire has been mysteriously flat before meetings,
with fresh ideas, and not just monetarily,” Contreras      and he received an anonymous phone call last June
explained. “We need everyone to promote our asso-          informing his that the LAAA convention was can-
ciation's non-stop growth and strength.”                   celled. With a feigned look of surprise, Rodriguez
                                                           said he couldn’t understand who would do such a
First up to the stage were the recipients of this year’s   thing. An investigation is underway.
award for Community Advocate(s) of the Year. As
most Agenda Magazine readers know, the LAAA                Getting back to serious topics, Contreras presented
facilitated a lawsuit against Choicepoint, Inc. alleging   the Valor Award from Vendor of the Year to EZ Buy.
the sale of proprietary client information to third        A unique and efficient way for producers to transact
party vendors. Deane Silke of Fiesta Auto and Miguel       business directly with clients over the Internet, in real
Rodriguez of Wizard Insurance agreed to be named           time, EZ Buy has provided a sensible solution for
as co-plaintiffs in the case, and have been very in-       competing with direct writers and carriers utilizing
volved with its evolution from the start. By taking        web-based quotation and sales portals.
such a stand on behalf of any producer losing busi-
ness due to the unauthorized and inappropriate sale        The final award was presented to the LAAA’s good
of his/her customer data, Silke and Rodriguez exem-        friend and staunch supporter, Larry Powers. Familiar
plified what it means to be a community advocate.          to Agenda Magazine readers for his “Powers’ Point of
                                                           View” columns, He is also a familiar face to LAAA
A two-time winner was longtime LAAA supporter              meeting veterans, often accompanied by a few newly-
Marc Sobel from Unitrin Specialty. Gracing the             licensed producers he has introduced to the associa-
November 2007 cover of Agenda Magazine, Sobel              tion. He is also (in)famous for holding the closing
received a personal award as Insurance Person of The       spot at the meetings, and, agree with him or not, you
Year, and also accepted a Valor Award on behalf of         are definitely compelled to stay and listen. Powers is
Unitrin for Commercial Market of the Year. Another         also a mainstay instructor for the LAAA, with his pre-
personal award was accepted by Tyler Nicholson             licensing courses among the most popular we offer
from FSC Insurance Solutions. Nicholson received           throughout the year. Beyond that, Larry is one of our
the Valor Award for Marketing Representative of the        “go-to” volunteers, always happy to lend a hand
Year. Those who are regular LAAA meeting atten-            wherever and whenever he can. The LAAA is proud
dees, as well as anyone who uses the FSC rater, can        to have bestowed on him the “Vanguard Award” for
attest to Nicholson’s dedication to the producer           his dedicated service to the association, our members,
community.                                                 and the insurance community as a whole.

LAAA Vice President (and Valor Award recipient)            Once the award presentations were completed, it was
Miguel Rodriguez then took over the presentation           time for the party to begin. The “Cumbia Ballenato”
duties from Contreras. First off, Rodriguez was            started jamming and the dance floor quickly became
pleased to present the award for Agency of the Year        elbow-to-elbow. For those wanting to celebrate the
to his fellow “community advocate” award recipient         evening in a more cerebral fashion, the blackjack
Deane Silke. Silke accepted the award on behalf of         tables on the patio were also open for business.
Fiesta Auto Insurance along with Fiesta’s President
and CEO John Rost. Rodriguez also presented the            “Every year we strive to get what we had last Saturday
awards for Auto Market of the Year to Safeco Insur-        at our Gala; a sense of community with professionals
ance, Health Market of the Year to Kaiser Perma-           not just getting alone, but truly enjoying each other’s
nente, Mexico Insurance Market of the Year to Inter-       company,” said Urena. “Agents, carriers, and vendors
national Gateway, and Life Market of the Year to           equally interested doing business and looking out for
Allianz.                                                   the well being of each other. Thanks to everybody for
Rodriguez handed the microphone back to Contreras
for the evening’s final two awards. Contreras joked        Contreras added: “Thank you all for your support
that Rodriguez has reminded him many times that, in        throughout 2007. I wish you all a safe and happy
the event he cannot complete his duties as LAAA            holiday season surrounded by your loved ones and
President, the Vice President (Rodriguez) would then       hope to see you all in 2008. Feliz Navidad y Prospero
take over the position. Contreras commented on how         Año Nuevo!”
32 | Agenda January

Relax & Think
28 | Agenda January

           or most of us, a home is the largest asset    When a death occurs on an insured person there is
           we will ever own and we have all heard        a tax free death benefit that can be used to either
           it said, “Home is where the heart is.”        pay off the remaining mortgage amount or to
           Our home is where our children are            make the regular mortgage payment so your family
 born, grow and we grow together as a family. It is      can stay in their home.
 the gathering place for all Holidays, celebrations,
                                                         You can buy an Accident Only Disability Rider
 and our own place of piece at the end of each day.
                                                         that provides financial benefits that can be used to
 The question is do you and your family have             make your mortgage payments in the event of an
 adequate protection, if any, from losing your home      accident related disability. There also exists a
 if you die, suffer a disabling injury or suffer a       Critical Illness Rider where you can receive an
 critical illness? Would your family be able to keep     accelerated payment of your death benefit if you
 up with mortgage payments or even pay off the           suffer from such illnesses as life-threatening cancer,
 mortgage if your income was no longer available?        heart attack, stroke and major organ transplant.
 Being able to answer these questions with a yes, is
                                                         It is easy to feel like, “I hate the idea of paying for
 being able to provide the security each family
                                                         coverage that I may not use.” The answer to this
 needs in a time of unforeseen events.
                                                         question is that many of these policies come with a
 Few things are as important as our family’s             Return of Premium Rider. This means that you
 security. There is usually no better time than the      can get back all of the premiums you paid into
 present to plan for our family’s security, especially   your policy at the end of your 15, 20 or 30 year
 when it comes to our home. Again, when we look          plan.
 back upon our lives, most of the important              These plans are easy to apply for and can often be
 memories we’ve had and the ones we have to look         issued within 5-7 work days. Your home is not
 forward to, have occurred or will occur in our          just a house, it is the foundation for the building
 homes.                                                  of your family and your family’s security at the end
                                                         of the day.
 There exist for all of us Term Life Mortgage
 Insurance plans that we can customize for the           Jim Lehmann from Innovative Marketing Strategies,
 protection of our homes for our families.               Inc. can be contacted at 800-540-8990.
30 | Agenda January

LAAA Members Corner
                                                           (My comment: I really don't want my tax dollars
 FOOLISHNESS                                               spent in this foolish fashion, with no return. Please
                                                           catch terrorists, rapists, murders and others who com-
                                                           mit high crimes and misdemeanors, but this foolish-
 AND                                                       ness? Give me a break. Fire the idiots who passed this

 FOOLHARDINESS                                             This legislation faces real constitutional issues in both
                                                           the AZ state courts and the federal courts. The pros-
                                                           pect that is foolishness is being enforced prompted
 IN ARIZONA                                                great outrage in AZ, the USA, and world business
                                                           communities. And with just cause. AZ has many
 The Crackdown                                             illegal immigrants working in the state. Understanda-
                                                           bly, as AZ is a border state to Mexico. Pew Hispanic
 on Illegals                                               Center estimated there were 500,000 illegal immi-
                                                           grants in AZ as of 12.31.2007. 350,000 of these folks
 By Stephen S. Santoro                                     held 11.6% of AZ's 3 million workforce. There ap-
                                                           pears to be more illegal immigrant workers in AZ than
               he State of Arizona passed a law, effective there are unemployed people. AZ's unemployment as

 T             1.1.08, that tries to curb illegal workers of 2.31.2007 was 4%.
               and immigration. Arizona only succeeded It is often alleged that illegal immigrants are clustered
               in strangling its own economy. A county on the bottom rungs of the employment ladder, in
 in Georgia also tried this in 2007, but repealed such a jobs requiring few if any skills: chambermaids, roofers,
 foolish act. Punishing businesses for hiring willing, gardeners, landscapers, dishwashers and farm workers.
 capable and crime-free workers who have a strong However, these jobs are necessary to the businesses
 work ethic is the most self-defeating piece of economic that are MOST important to AZ's tourist-driven
 legislation since prohibition. It affects all of you as economy. (This is similar to the needs of: CA, TX,
 insurance agents/brokers, our insurance companies, FL, NV, NY, IL and others.)
 and reinsurance companies, regardless of the risks we
 insure or cover in economic and financial ways it The University of AZ published a study in 7.2007
 should not. This type of foolishness was passed in AZ estimating that AZ's annual economic output would
 and GA. Will it come to early “adopter and opinion drop by 8.2% if all illegal immigrants were detected,
 leader states” like CA, IL, NY, TX and FL?                discharged and deported. THAT LOSS WOULD
                                                           COST AZ BUSINESS $29 BILLION, NOT IN-
 I love American democracy for its entertainment value, CLUDING THE LOSS OF OUTPUT FROM
 however I am not amused or entertained by the BUSINESSES FORCED TO CLOSE, MANY PER-
 “experiment” that was conducted on the people of the MANENTLY, IF THEIR LICENSES WERE RE-
 state of AZ, effective 1.1.2008. I felt the same way VOKED.
 regarding same foolishness in GA. Democracy is a
                                                           Think about this: AZ has a 3 million workforce.
 theory that people know what they want and then they
                                                           What about CA with a 40 million workforce? TX
 deserve to get it-good and hard. AZ started 2008 by
                                                           with 25 million? FL with 19 million? GA with 14
 giving people who fear illegal immigration just what
                                                           million? The costs to these states is astronomical! Do
 they wanted. Local officials in AZ started enforcing
                                                           these politicians think about this before they draft and
 the strictest state law in the USA (at that time) against
                                                           pass such foolish and stupid legislation? Ever wonder
 business that hire illegal immigrants, knowingly or
                                                           why we are a deficit nation now?
 unwittingly. This allows for citizens to lodge reports
 with county sheriffs and county attorneys when the This foolishness culminates a 21-year trend: The US
 citizens suspect that business is hiring illegal immi- Government passed laws in 1986, improperly and
 grants. When investigations verify alleged suspicions, foolishly putting the onus of illegal immigration con-
 the state of AZ suspends the business's license to do trol on employers. The basic premise: People come to
 business for 10 days. A second offense is automatic the United States of America to work and have a
 revocation.                                               better life for their families. Don't let work and they
                                                                                                     Agenda January | 31

will not come. Congress knew well that businesses         A vast majority of AZ manufacturers tell local AZ re-
needed workers to do low-skill, low-wage jobs, even       porters these manufacturers are moving operations to
though unions and other powerful interest groups want     more business friendly states, even into more business
to reduce immigration in hopes of driving up wages.       friendly countries like Mexico, where they can hire
The political solution was to pass laws that “mollify and Mexicans legally. This option is not available to build-
pacify” anti-immigration groups, but don't fund money     ers, hotels, airlines, resorts, restaurants, retailers and
for enforcement. The ruse worked. 7.5 million illegal     other businesses that tied to their existing locations.
immigrants have taken jobs in the USA since 1986.         Many of the aforementioned AZ businesses, however,
                                                          are CANCELING their plans for expansion. What
(Folks, that is a published number by the USA Census.
                                                          does that cost the AZ economy? What does that cost
I believe the real number is multiples higher.)
                                                          the AZ government in lost taxes?
This ruse however, created a spread of immigration
beyond port cities and border states to nearly every If this AZ law is enforced effectively, all of these busi-
state, which raised passions against such alleged illegal nesses will have to pay multiples more to attract workers
immigration. The economic results of this ruse are in a state that claims just under 4% unemployment.
blatantly obvious: Businesses that could use low-skill Foes of immigration say it is fine with them if employ-
workers hired them, knowingly and unknowingly. ers have to pay more and it is even better if illegal immi-
These low-wage workers held down the cost of con- grants are unable to work, who then would go back to
struction, hotel stays, landscaping, restaurant meals and their respective countries of origin and take their school
services, hospital stays, and many other services you and age children with them. Taxes on the 8.2% of AZ's
I use EVERY day, particularly in finance, insurance and output don't come close to paying for immigrants
reinsurance.                                              burden on AZ schools or other public services, these
The businesses that employ these folks prosper as a            foes of immigration allege. The only problem these foes
result of their services being delivered more affordably       of immigration see with AZ's law is that it does not
to consumers like you and me. Unemployment is lower            apply universally throughout the USA.
and adjusted gross domestic product is MUCH higher
than it was in 1986 when Congress passed these laws.           (NOTE: I have never seen a credible study, performed
Some still believe the “social cost” of immigration is too     by a credible source, that supports the views, allegations,
high.                                                          contentions and desires of these aforementioned foes of
                                                               immigration. NEVER. Why is that?)
AZ businesses worked hard to improve their ability to
detect workers with false papers. In mass numbers they
                                                               Threatening businesses with their own demise, destruc-
signed up for the US Government's “E-Verify” pro-
                                                               tion and extinction for hiring ready, willing, hungry,
gram, a computerized check of Social Security numbers
                                                               able and crime-free people who are happy to be working
and immigration documents proffered by job appli-
                                                               is the most foolish, stupid, self-defeating legislative act
cants. AZ law required ALL business to use E-Verify
                                                               since the passing of the equally foolish, stupid and self-
after 1.1.2008. The sad part for business owners/
                                                               defeating Volstead Act which enforced national alcohol
shareholders and the vast majority of workers who are
                                                               Prohibition. This AZ act most certainly will corrupt
legal is this: The data of E-Verify is frequently wrong,
                                                               and has overwhelmed the AZ officials charged with its
out-of-date or not properly input. This is the summary
                                                               enforcement. It has disrupted legitimate AZ business,
of the Government Accountability Office (GAO) and
                                                               reduced profits on AZ's most lucrative industries, raised
other researchers.
                                                               unemployment and greatly lowered economic output.
In fact, the US Government's own experience of man-
dating E-Verify, by the US Government's own admis-             AZ's law sent jobs to NM, NV, CA, UT, CO, other
sion is that E-Verify's utility is questionable, inaccurate,   close by states and Sonora, Mexico, site of AZ's out-
out of date and NOT reliable. So AZ mandates it's use?         sourcing, at AZ's HUGE expense. I just described the
One year after the US Dept. of Homeland Security               power of foolish, stupid and misguided democracy:
(DHS) mandated that the US Government would use E              Satisfy a vocal minority/constituency and every inno-
-Verify to check on the people DHS hired, most DHS             cent bystander gets it-good and hard. Remember: These
agencies had not begun to use E-Verify. As of                  immigrants are your customers, clients, insureds, rein-
12.31.2007 only five out of 22 offices, bureaus and            sureds and future.
agencies in DHS use E-Verify, and they note E-Verify is
wrong over 50% of the time! And AZ mandated the
use of E-Verify?                                               You decide!
                                                                                               Agenda January | 35

                                        Nuestra Música - VOL. 18

                    Kevin Johansen                         That same year, now with a new album in his hands,
                                                           he returned to Argentina, where he currently lives. The
                                                           album, released by Los Años Luz, was relatively success-
                                                           ful and The Nada toured as far as Spain. By the end of
                                                           2002, Johansen had recorded Sur o no Sur, released by
                                                           Los Años Luz in Argentina and by Sony Music in the
                                                           rest of the world. The disc was another eclectic mix-
                                                           ture of Latin music, pop, and humor.

                                                           During 2003, Kevin hit huge in Argentina, playing at
                                                           the Gran Rex Theatre, the largest Buenos Aires hall. In
                                                           Spain, he promoted his new album with concerts in
                                                           Madrid and Barcelona, with this tour featuring much
                                                           larger bigger audiences. He also performed at the
                                                           MTV Latino awards, then did a five-city national U.S.
                                                           tour prior to the American release of the album.

                                                           In 2004, he embarked on a world tour, with stops in
                                                           Mexico, Chile, Belgium and Spain. Coming off an

        n the past few issues of Agenda Magazine, I have   even greater response to his music, now with a global
        shared more mainstream – some say conven-          fan base, Johansen received three the Latin Grammy
        tional or popular – artists with you. Hopefully,   Awards nominations: Sur o no Sur was nominated for
        you have had a chance to listen to this music      Album of the Year, and the single La Procesión received
and count them among your iPod playlists. This             Best Video and Song of the Year nods. During this
month, I wanted to help you expand your musical            busy year, Johansen recorded his third album City Zen
horizons with someone a little off the beaten path, an     to much acclaim from fans and critics alike. Last year
artist who will broaden you musical tastes with the        (2007), he released his fourth and latest album, Logo.
first pass.
Kevin Johansen, born in Fairbanks, Alaska in 1964, is      Johansen is a great
an Argentine-American rock musician. With his Ar-          talent and his work
gentine mother and American father, Johansen lived         definitely shows how
most of his childhood in the San Francisco Bay Area,       music can transcend
then moved with his family to Buenos Aires at the age      labeling and make you
of 12.                                                     realize how much we
In the 80’s, he made a brief appearance on the local       are all part of one big
rock scene with the band Instrucción Cívica, releasing     global melting pot.
their sole album Obediencia Debida in 1985. In 1990,
Johansen traveled to New York in 1990, where he met
and married his Argentina-born wife, with a daughter
                                                           I      suggest
                                                           you check
later entering into the equation. He played the world-     out Sur o no
famous (and now defunct) CBGB's club for years.            Sur and pay
                                                                            The Nada (2000)
Eventually, he formed the group The Nada, and, in          s p e c i a l    Sur o no Sur (2002)
2000, recorded a self-titled album. The effort was a       attention to     City Zen (2004)
mix of different Latin sounds with modern pop, funk
and rock.
                                                           its lyrics.      Logo (2007)