2014 Incentive Plan Policyholder Service & Support Associates and Agents Policyholder Service & Support All Regions CSAA Insurance Group Effective 07/01/2014 3055 Oak Road, Walnut Creek, CA 94597
Table of Contents Page Incentive Plan Introduction 3 Eligibility 3 Incentive Plan Objective 3 Target 3 Incentive Plan Measurement Periods Monthly Bonus o Leads Bonus Component o When there are no QM Lead Question Opportunities o Monthly Bonus Calculation Scenarios 3 4 4 5 6 Quarterly Bonus 7 Definitions 7 2
Incentive Plan Introduction This 2014 Policyholder Service & Support Associate and Agent Incentive Plan ( Incentive Plan ) is effective July 1, 2014 and will continue until amended, replaced and/or withdrawn by CSAA Insurance Group ( CSAA IG ). It supersedes and replaces any and all previous incentive plans, whether written or oral, concerning incentive and/or bonus compensation paid or payable to Policyholder Service & Support ( PS&S ) Associates and Agents. This Incentive Plan may be modified in whole or in part, at any time, and from time to time, prospectively or retroactively, as CSAA IG may in its sole discretion deem advisable. Modifications to this plan may be made only by the CSAA IG Executive or the Chief Administrative Officer. Any approved changes to this Incentive Plan may be announced and distributed by email, and affected PS&S Associates and Agents will be notified as soon as feasible. CSAA IG may transfer or assign its obligations under this Incentive Plan, at its discretion. CSAA IG nevertheless may, from time to time, sponsor or sanction additional incentive programs ( contests ) with specific objectives, eligibility criteria and rules describing the incentives available to the qualifiers for a particular performance period. Such contests will be described in separate communications. Eligibility Employees who are active, full-time PS&S Associates and Agents (job codes: AF19A2, AF19A3, AF19A4 & AF20A3) and in Good Standing, as well as those who have completed nesting and are in their first full month of production and are in Good Standing, are eligible to participate in the components of this Incentive Plan. Eligibility for this Incentive Plan precludes eligibility under any other incentive plan, including, without limitation, the Annual Incentive Plan ( AIP ). Incentive Plan Objective PS&S is committed to achieving the 2014 Policyholder Experience Score Goal. In support of this effort, the Incentive Plan will use the PS&S Associate s or Agent s Policyholder Experience Score as the key bonus driver. In addition, Associates and Agents can earn incentives from the Leads Bonus Component (Leads Generated or the Lead Quality Management Question), which supports the growth of new business revenue. Target Target refers to the monthly and/or quarterly Policyholder Experience Score (PHE) and Qualified Lead Generation required by each PS&S Associate or Agent to qualify for bonus. CSAA IG reserves the right to increase the Target(s) at any time, as CSAA IG may in its sole discretion deem advisable, should: significant improvements to the sales and/or service process be introduced; additional marketing avenues/tools/programs be launched or implemented; or the staff of full-time PS&S Associates and Agents significantly change. Incentive Plan Measurement Periods Incentive Component Measurement Period Page Monthly Bonus Monthly 4 Quarterly Bonus Quarterly 6 3
Monthly Bonus The Incentive Plan offers PS&S Associates and Agents an additional earning opportunity each month from two Monthly Bonus components: Policyholder Experience (PHE) Score and Leads. The Monthly Bonus is computed using an employee s overall PHE Score for the month plus either the dollar amount the employee generates each month from Qualified s or by asking the QM Lead Question. Policyholder Experience (PHE) Bonus PS&S Associates and Agents can earn a PHE bonus based on their overall PHE score for the month. The amount of the bonus for a given month is the amount associated with the associate s or agent s PHE score, as noted in the following chart. Policyholder Experience Score Bonus Schedule Monthly Overall PHE Score Bonus Amount 100 $200 95 $125 90 $100 85 (Target) $75 80 84.5 Less than 80 Eligible for Lead/QM Lead Question bonus only Not eligible for a bonus Leads Bonus Component Employees can earn a bonus for Leads from either the formula or the QA Lead Questions formula, whichever bonus amount is greater. Formula Product Bonus Per Qualifying Lead Auto/Home $4 Non-Auto/Non-Home $1 4
QM Lead Question Formula Formula Formula is a ratio: The number of passing scores on this question divided by the total number of evaluations. Multiply that number by the Lead Target Bonus Lead Bonus Target $40 Lead QM Question Examples: 1) An employee has four evaluations in a month and gets a passing score on the QM Lead Question all four times, so the ratio is 1. The bonus would be $40 (1 x $40). 2) An employee has four evaluations in a month and gets a passing score on the QM Lead Question two times, so the ratio is 1/2. The bonus would be $20 (0.50 x $40). In either example, if the employee generated leads that totaled more than what the Lead QM Question Formula would be, the employee will earn that higher amount. When there are no QM Lead Question opportunities Employees who do not have many lead generation or QM Lead Question opportunities (for instance, their evaluated calls were from club or independent agents) will participate in the bonus under a Modified Policyholder Experience Score Bonus Schedule. The modified schedule rolls the Lead Target Bonus amount into the PHE Score Bonus so that employees have an opportunity to earn their full complement of Target Bonus. Modified Policyholder Experience Score Bonus Schedule PHE Score Bonus Amount 100 $240 95 $165 90 $140 85 (Target) $115 80 84.5 Less than 80 Lead/QM Lead Question bonus only Not eligible for a bonus 5
Monthly Bonus Calculation Scenarios To keep comparisons similar, the employee s PHE score in all scenarios is 85 (Target). 1) Employee earned $52 in generated leads, which is greater than the QM Lead Question Formula amount would be. 85 $75 $52 $127 2) Employee earned $26 in generated leads, but had a ratio of 1 for the QM Lead Question Formula, which would be $40. Therefore, the bonus amount would be $40 (the greater of the two amounts). QM Lead Question 85 $75 $40 $115 3) Employee earned $36 in Leads Generation, but had a ratio of ¾ (0.75) for the QM Lead Question Formula, resulting in an amount of $30. Therefore, the bonus amount would be $36 (the higher of the two). 85 $75 $36 $111 4) All of the employee s evaluations were on calls with club and independent agents, with no opportunities to generate leads or ask the QM Lead Question. This situation warrants using the Modified Policyholder Experience Score Bonus Schedule. using Modified Schedule 85 $115 N/A $115 5) The employee earned $48 in leads but also had a number of calls that were with club and independent agents. Two of the employee s evaluated calls were with agents, with no opportunities to generate leads or ask the QM Lead Question, and the other two were on policyholder calls in which the agent asked the lead question. The ratio for those two calls was 1, so the employee earns the $48, since that amount is greater than the $40 threshold. 85 $75 $48 $123 If the employee had earned only $32 in leads, then the QM Lead Question Formula would have applied, since it is more. 6
Quarterly Bonus The Incentive Plan offers an additional earning opportunity each quarter from the Quarterly Bonus component. The top 15 performers across all sites will each earn a quarterly bonus of $500. To be eligible, employees must generate an overall average PHE Score of 90 or better for each month in the quarter. In the event of a tie, the tying employees lowest monthly PHE scores during the quarter will be compared. The employee with the higher score of the lowest monthly scores will be awarded the bonus. Example: Employee A has scores of 94, 92 and 95 in a quarter, for a total of 281. Employee B has scores of 95, 95 and 91, also for a total of 281. Definitions Employee A s lowest score is 92, which is higher than Employee B s lowest score of 91. Therefore, the Employee A would be awarded the bonus. Auto/Home Leads Leads generated by a PS&S Associate or Agent that result in a quote for a AAA customer for the following products: Select Auto, Signature Series Auto, IIB Homeowners (HO-3), Preferred Homeowners (HO-5) Good Standing A PS&S Associate or Agent who has not been placed on any type of corrective action is considered in good standing. An Associate or Agent placed on corrective action during the three (3) month period beginning with the corrective action will not be eligible to earn, be paid or receive bonuses or recognition under this Incentive Plan, or elsewhere, as Good Standing is a condition to earning any component of this Incentive Plan and any contest. Nesting Nesting is a transitional training period that follows formal classroom training. Agents take live calls under the guidance of a monitor and are coached for development and support. Non-Auto/Non-Home Leads Leads generated by a PS&S Associate or Agent that result in a quote for a AAA customer for any incented product, sold by CSAA IG sales agents, that is not considered a Tier 1 product. Examples include Renter s Insurance (HO-4), Earthquake, Flood, Personal Umbrella Policies and Specialty products. Policyholder Experience Score The score a PS&S Associate or Agent earns under the Policyholder Experience QA Evaluation program. In most circumstances, QA will use four evaluations each month to calculate the Policyholder Experience Score. QM Lead Question Essentially, offering another product and generating a lead (see also Qualifying Leads below). The QM Leads Question score looks at the following elements on an evaluation: Was the opportunity to offer the caller a quote available? If the opportunity was available, did the agent offer the caller a quote? Was the quote offered appropriate to the caller s needs? Qualifying Leads Leads generated by a PS&S Associate or Agent that result in a quote being issued to a AAA customer or member from a licensed, qualified, and eligible AAA sales agent. (2) Back to Monthly Bonus page (4) Back to Introduction page (3) Back to Monthly Bonus Calculation Scenarios page (6) 7