KJKC - News Update

Dear IMSA Friends:

November is gone, and the days are getting shorter – so is this newsletter. This month’s edition should be a quick read, but we trust you will find it of interest. We have chosen a Thanksgiving theme for the month, since we have so much to be thankful for, not the least of which has been your continuing interest in IMSA ethical market conduct and the Kenneth J. Kalis Company. I am very thankful for each of you personally as well, and the blessing you have brought into my life.

IMSA?……..we can help!

November Articles

· Why IMSA?

· How Do I Join IMSA?

· How Can I Rejoin IMSA?

· News from IMSA Today

· Best Practice of the Month – Red Leaves Christian Clipart

· What’s Up at the Kenneth J. Kalis Company

"As we express our gratitude, we must never forget that the highest appreciation is not to utter words, but to live by them."
-John Fitzgerald Kennedy

What Is IMSA All About?

To forestall any federal regulations or further state actions, concerned companies got together under he ACLI aegis to develop six Principles of Ethical Market Conduct and a Code of Conduct for complying with them.

1. To conduct business according to high standards of honesty and fairness and to render that service to its customers which, in the same circumstances, it would apply to or demand for itself.
To provide competent and customer-focused sales and service.
To engage in active and fair competition.
To provide advertising and sales materials that are clear as to purpose and honest and fair as to content.
To provide for fair and expeditious handling of customer complaints and disputes.
To maintain a system of supervision and review that is reasonably designed to achieve compliance with these Principles of Ethical Market Conduct.

What are the Benefits for My Company?

You Can Strengthen Your Competitive Position: Let's face it. If a purchasing decision comes
down to choosing between an IMSA company or a non-IMSA company, which would you buy
from?
You Gain Credibility and Entry to Markets: IMSA member companies frequently find they get
quicker entry to banking and brokerage environments thanks to the IMSA logo.
You Reduce the Risk of Regulatory Actions. For IMSA members, market conduct exams may be eliminated or reduced to desk review status. Some states will conduct less rigorous examinations.
You Strengthen Your Position With Rating Agencies. Compliance with IMSA’s code is an
increasingly important element for the rating agencies. One of them has even said, "If you're not an IMSA member, we'll want to know why."
You Will Raise the Overall Ethical Consciousness in Your Company. Just participating in the
process sends this strong message to everyone in the company: ethical market conduct is
very important!
You Will Identify "Gaps" In Your Policies and Procedures: As you go through the assessment
process, opportunities for improvement will emerge. You will be able to strengthen your procedures and eliminate potential problems before they become lawsuits.

“Gratitude is a quality similar to electricity: it must be produced and discharged and used up in order to exist at all.” –William Faulkner
You Can Cut The Number of Complaints and Sharpen Customer Focus. You will use root cause analysis to identify and eliminate policies and procedures that generate complaints. Customer satisfaction will rise; loyalty will increase.
You Will be Among the Industry Leaders. Who do you want to be associated with? Why not show your Board that you are among the industry leaders who support ethical market conduct?
You Can Strengthen Your Advertising. Use the IMSA logo to show that your company is committed to ethical market conduct.
You Protect Yourself and Your Company From Suits and Their Costs. To settle lawsuits, companies have spent literally billions of dollars. If you ever find your company in court, you'll want the jury to see your IMSA logo, a public commitment to ethical market conduct. Don't take the risk of ever having to explain to a jury why you chose not to seek IMSA membership.

How Do I Join IMSA?

Companies seeking IMSA membership are required to demonstrate that they are committed to becoming IMSA qualified by adopting IMSA standards. IMSA qualification is a two-step process:

Step 1. The company conducts a self-assessment by comparing its current policies and procedures to IMSA standards (found within the Elements of Compliance chapter of the IMSA Assessment Handbook). In order to comply with IMSA standards, the company may establish new policies and procedures and/or make modifications to current policies and procedures, as appropriate. Once the company concludes that it can demonstrate compliance with IMSA standards, it moves to the next stage.

Step 2. A Qualified Independent Assessor, selected from a list of IMSA-approved Qualified Independent Assessors, reviews the company's self-assessment evidence and performs an independent assessment to evaluate whether there is a reasonable basis for the company's determination that it has complied with IMSA standards.

Satisfactory conclusion of the two-step assessment process will allow IMSA, upon the company's completion of the application process, to confer membership in IMSA for a period of three years. During the three-year membership period, members are encouraged to review, modify and improve their market conduct practices consistent with IMSA's "continuous improvement" concept. At the end of the three-year period, members must repeat both the self and independent assessments to renew their IMSA qualification.

There is one day that is ours. Thanksgiving Day
is the one day that is purely American.
O. Henry

How much does membership cost?

There is an annual membership fee based upon the size of the company and calculated in a way similar to that used for ACLI membership. The annual fee ranges from $5000 for a small company to $185,000 for the largest companies. There are also fees for the independent assessment which differ widely by provider and by company size, product line and number of distribution channels (career agents, Independent agents, direct marketing, third party distribution, etc.). In our experience, these fees range from $20,000 to $30,000+ per distribution channel but again depending on the size and complexity of the company.

How long does it take to become a member?

The time line will vary by company, but a good estimate is six months. If your company’s marketing and compliance policies and procedures are well-organized and up to date, that time could be considerably less. Request our article on “90 Days to IMSA Membership” to get an idea of the steps.

How Can I Rejoin IMSA?

As many of you know, IMSA has created a streamlined reinstatement process for former members. Due to the economic downturn, this new expedited approach will be available through the end of 2010.

To renew your IMSA membership this way, you need to:

• Perform due diligence to determine you meet the IMSA standards.

• Prepare a CEO / CCO signed Reinstatement Attestation

• Attach all required examination reports

• Demonstrate compliance with the IMSA standards for the past 90 days

• Engage a Qualified Independent Assessor to do an abbreviated assessment of 7 or the 25 IMSA standards

• complete the process by December of 2010.

Ken Kalis was a member of IMSA’s Working Group that created this cost effective way to renew IMSA membership and to minimize or eliminate external assessment costs in the future. A good first step is to call your Qualified Independent Assessor and start to formulate a strategy. We Have been talking with a number of companies who are interested in using this approach to renew their membership, and we would be interested in talking with you about it too. If you are interested, please call us at 352-505-0705 or email to kkalis@kkalis.com.

"For flowers that bloom about our feet;
For tender grass, so fresh, so sweet;
For song of bird, and hum of bee;
For all things fair we hear or see,
Father in heaven, we thank Thee!" -Ralph Waldo Emerson

News from IMSA Today November 3, 2009

2010 IMSA Leadership Announced

At IMSA’s recent Annual Meeting, the IMSA Board of Directors confirmed Michael Masterson, Chairman & CEO of Sammons Financial Group, as IMSA’s 2010 Chairman.

“It’s a new economic climate, and market conduct has never been more important than it is today,” said Masterson. IMSA’s standards and compliance solutions will serve the industry well moving forward.” The Sammons Financial Group includes Midland National Life and North American Company for Life and Health Insurance.

Paul Mistretta, Chief Operations Officer, ING U.S. Life, will serve as Chair-Elect. "IMSA is very well positioned to continue making meaningful contributions to manufacturers, distributors, regulators, and consumers," he said.

The following IMSA Board members were approved for a new three-year term:

Kevin J. Donnellan, AARP

Timothy F. Kneeland, (AEGON) Transamerica Life Insurance Company

Eugene Choate, Bankers Fidelity Life Insurance Company

Leon E. Roday, Genworth Financial Group

Scott A. Curtis, Raymond James & Associates, Inc.

Steven J. Dreyer, Standard & Poor’s

David F. Woods, Woods Financial Group

"If the only prayer you said in your whole life was, "thank you," that would suffice."

-Meister Eckhart

News from IMSA Today November 19, 2009

IMSA Social Media Webinar – December 2, 2009

The Social Media Communication…It’s Here to Stay webinar will be held on Wednesday, December 2, 2009, from 1:00-3:00 pm EST, where updated expert intelligence will be shared exclusively with IMSA-qualified companies. The webinar will:

* identify the challenges that social media presents;

* provide an understanding of the benefits and opportunities for insurers; and

* address possible controls and the mitigation of the various risks.

Speakers will include Kip Gregory, a national expert on social media in the insurance and financial services industry, and Chris Richter, CEO of Socialware, Inc., a technology solutions provider. If you have any questions, please contact John Travagline at (240) 744-3023.

Annuity Suitability Certification Clearinghouse Welcomes Ameriprise

IMSA would like to welcome the Riversource Life Insurance Company (an Ameriprise company) as its newest IMSA Annuity Suitability Certification Clearinghouse subscriber. The Clearinghouse continues to add new distributors (approximately 850 currently enrolled), as well as company members, all of whom are able to implement a more efficient approach to meeting the requirements of the NAIC Suitability in Annuity Transactions Model Regulation (now adopted by 46 states). Visit www.IMSAethics.org for more information.

"If you want to turn your life around, try thankfulness. It will change your life mightily."
[Gerald Good]

NAIC & Social Media – December 8th

The NAIC and IMSA will co-host a training session on the Use of Social Networking Sites in Insurance at the NAIC Winter National Meeting in San Francisco on December 8th at 10:00 am. Insurance companies and distribution channels need to work together on social media policy, but regulators need a full understanding of the issues as well. The session is open to all regulators and other NAIC meeting attendees. For more information, please contact Don Walters at (240) 744-3027 or DonaldWalters@IMSAethics.org.

Universal Life – The Producer Perspective

In the quest for continuous marketplace improvement, IMSA recently convened its Producer Advisory Group (comprised of longstanding industry-leading producers) to discuss concerns about Universal Life policy lapses and disclosures. IMSA was advised that clients may not always be aware of the status of their policies, and that new steps may be helpful to ensure that policyholder communications are meeting all stakeholder expectations. We will continue to explore this issue and keep you updated.

IMSA Social Media Working Group Update

As an outgrowth of the AARP-IMSA Social Media Summit in October, IMSA has convened a Social Media Working Group to determine leading practices and possible controls associated with social media. The Working Group, comprised of individuals who represent Marketing, Communications, Technology and Compliance, has been divided into three sub-groups to address:

1) marketing advantages and opportunities;

2) compliance and regulatory issues;

3) communications and Corporate Risk Management. Contact John Travagline @IMSAethics.org for more information.

"The unthankful heart... discovers no mercies; but let the thankful heart sweep through the day and, as the magnet finds the iron, so it will find, in every hour, some heavenly blessings!"

-Henry Ward Beecher

Upcoming Meetings

Future industry events in which you may be interested include:

December 2 IMSA Communications Committee Call

December 2 IMSA Social Networking Webinar

December 3 LICONY Annual Meeting – New York, NY

(IMSA to Present on Social Media)

December 5-8 NAIC Winter Meeting – San Francisco, CA

December 8 IMSA-NAIC Training Session – San Francisco, CA

“Use of Social Networking Sites in Insurance”

January (TBD) Distribution & Social Media Webinar

To submit comments or to cancel your email subscription at any time, please contact Jennifer Kalita at JenniferKalita@IMSAethics.org

Gratitude is the inward feeling of kindness received. Thankfulness is the natural impulse to express that feeling. Thanksgiving is the following of that impulse.
Henry Van Dyke

Best Practice of the Month – IMSA for FSG & SOX

At the ACLI Legal and Compliance Section meeting in Boston, I was a part of a larger discussion on whether IMSA could be used as an “Ethics Program” that would qualify for consideration under the Federal Sentencing Guidelines or Sarbanes-Oxley Section 404. IMSA certainly forms a strong core upon which to the kind of Compliance Program that FSG is looking for. I believe it does meet the SOX 404 requirements. In both instances it is an excellent base on which to build a strong and comprehensive which will help you not only take advantage of the fine and penalty relief the FSG provide but, more importantly, make you a strong and ethical company with a culture that will keep you from being charged at all.

What We’re Up to at the Kenneth J. Kalis Company

We are marketing away, reaching out to current and former IMSA members as well as to companies who have never been IMSA members. There is some interest, and we are hoping it will build. Hits on our web site at www.kkalis.com have risen a little, and we are getting some requests for proposals on assessments and attestations. Our work with current clients on IMSA matters continues and has broadened in some cases to include presentations on “Why Compliance?” as well has some assistance helping companies strengthen compliance using IMSA to meet some of the Federal Sentencing Guidelines. We are also helping to develop compliance plans and risk assessments. Call 352-505-0705 or email us at kkalis@aol.com with any questions you have or ideas on how we can improve our services.

IMSA?……..we can help!

Pride slays thanksgiving, but an humble mind is the soil out of which thanks naturally grow. A proud man is seldom a grateful man, for he never thinks he gets as much as he deserves. Henry Ward Beecher

Do not get tired of doing what is good.
Don't get discouraged and give up,
For we will reap a harvest of blessing at the appropriate time.
- Galatians 6:9

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Hope you all had a great Thanksgiving. Thank you for your continuing interest in IMSA, ethics and our company. Happy Holidays to all.

Ken Kalis
Serve the LORD with Gladness! Psalm 100:2

IMSA?……..we can help!

Ken Kalis
352 -505-0705 office
352-215-9124 cell
Only Believe. Mark 5:36

IMSA?
..................Ken Kalis!
352-505-0705 www.kkalis.com

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Thank you all for your continuing interest in IMSA, ethical market conduct and the Kenneth J.Kalis Company.
www.kkalis.com
Only Believe. Mark 5:36