By: Tim Woitach
E&O claims are a serious concern for insurance agencies, especially in specialty insurance markets. With detailed coverage tailored to each specific insured, aspects of the policy can be overlooked. The responsibility lies in the hands of both the agency and the carrier to cross every “t” and dot every “i” when providing insurance for a client. Here are a few ways your agency can protect against E&O claims:
Know What You’re Selling: In the specialized insurance world, no two policies are the same. Make sure to thoroughly review each policy and communicate any noted enhancements and exclusions.
- McNeil & Co. offers resources to help our brokers understand and convey the intricacies of our policies. We provide risk management surveys and evaluations, flip charts with policy overviews, and new producer training, just to name a few!
Document All Communications with Accounts: As agents are managing multiple accounts at any given time, things can get lost in the shuffle. Make sure you document and file all communications with your accounts for reference.
Written Documentation for Declined Coverage: An agent’s job is to present and recommend the best coverage options for their client, but there is no guarantee that an organization will take your advice. If an insured declines coverage where a sign-off form is necessary, make sure to collect and file the form. If there is no requirement, documenting in writing that the insured rejected a recommended coverage can help you if a claim were to occur.
Established Internal Policies & Procedures: Every agency should have established written procedures in place for employees to follow. Adhering to these policies and maintaining written documentation of every step along the way can help you defend against an E&O claim.
Timely Claims Reporting: It is important to deliver notice of claims using the method specified in the policy. In addition, as a best practice, it is safest to send notice using one other reliable method (phone, email, overnight mail, regular mail, etc.).
Make sure to follow the policies of your organization and thoroughly examine each proposal you present, asking for clarification on any coverage that you don’t understand. Having a procedure in place and documenting every step of the process can help you protect against potential E&O claims.