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Bill Tuscano stopped by the office last week and yelled at me. No matter how old I am, my dad asserts this privilege. This time it was about the phone system and that concerns me. Apparently, even though he knows Nancy, our receptionist, takes a lunch break from 12 noon – 1:00PM, he feels that the message should be more succinct and state the office is closed. But the office isn’t closed I whine, instead, we leave it to our caller to self-navigate to the person they want to speak with. Which is all well and good, unless you are Bill Tuscano and in that case someone better pick up the phone.

I was reading an article in the IA&B’s magazine recently, which really hit home. The article was about value proposition, something I have been pondering a lot lately. First, we should define what we mean by ‘value proposition’. In the article is says it is how we create value for others and the reason for our professional existence. I immediately made the connection to what it is not – a commodity; in other words, it is not what you get from a web site or a call center.

Webster defines commodity as “A good or service whose wide availability typically leads to smaller profit margins and diminishes the importance of factors (as brand name) other than price.” Sounds like what happens when we all compete on price alone. Yet I understand that consumers are the ones that drive price. What will help is for all of us to spend time creating or enhancing our value proposition, working to distinguish ourselves based on service, coverage, and relationship.

One of the simplest examples I can offer is our vacant dwelling program. Last year we introduced a replacement cost and special perils coverage option for this program. We have not sold as much of this option as I would have hoped for – obviously the ACV/basic perils form is always cheaper. As winter progressed, and the number of ice and snow claims rolled in, I know a few clients and producers wished they had made a decision on something other than price. This doesn’t make me happy – I would much rather write the coverage at the higher price and pay the claims. A commodity brain thinks “Phew, I dodged the bullet on that one” while a value proposition brain thinks “I am so happy that we were there when you needed us”.

There are always opportunities that lead to developing your value proposition, one of them being recent changes in federal legislation concerning lead paint. The new EPA rule goes into effect beginning in April of 2010. The rule addresses remodeling and renovation projects disturbing more than six square feet of potentially contaminated painted surfaces for all residential and multi-family structures built prior to 1978 that are inhabited or frequented by pregnant women and children under the age of six. The bottom line for you is to consider how this will affect your trade contractors, rental property owners, and property ‘flippers’. The rule is specific in its application and practices. For more information, I recommend you start with the EPA web site pages on lead in paint, dust and soil. This is also a resource to recommend to your potentially affected clients. We are in discussions with our markets and expect several to come out with new programs for the contractors who do this work. When they do, we will let you know.

Now, if I could only figure out how to teach Bill to dial my extension. Have a Happy St. Patrick’s Day and don’t forget to call your lucky underwriter for that next brokerage account that lands on your desk.