Documentation is the most important key to your defense when your E&O carrier has their Claim Department or an assigned law firm handling an E&O claim.
What is your documentation process? Do you have a routine process? Are having meaningful file notes something you think you should have but don’t commit to practicing?
It’s very important to train yourself and your staff to routinely document every conversation that you have with your clients and prospects. If you are not paperless, make a specific form that you use just for this purpose and give it a title; even consider using a different color paper so these notes are easily accessed. If you are paperless, take the time to update your file notes so that your files tell a detailed story.
Experience has demonstrated there is a lot of confusion on the part of many producers and agents concerning the operation of their Claims Made and Reported Errors and Omissions coverage. This confusion can be costly and allow the agent to become a victim of one or more potential pitfalls, which exist. We hope the following information will be helpful.
Key terms you should know:
Occurrence – An event or chain of events that ultimately causes a claim. Example: The sale of a policy
There is much talk in the insurance industry regarding the possible upcoming Department of Labor Fiduciary Ruling and the impact this will have on insurance agents and advisors. Whether the new administration approves or does not approve the proposed ruling, many companies have indicated they will still be implementing best interest contracts.
The basis of the ruling really comes down to how an insurance agent or advisor is compensated by the insurance company so that the insurance agent or advisor is working in the best interest of the client and not swayed by the compensation offered by different products available. Much information regarding the ruling can be found here.
When selling insurance, you need to have more in mind than just finding the sweet-spot where you think your prospective client is comfortable with the premium.
Selling a disability policy can be compared to buying a car. Would your client want a compact car at claim time, or would they prefer to have a luxury model? Although many E&O claims in Bucks County can stem from buyer’s remorse, it’s important that you have documentation that you took the time to offer the best options available through the insurer that you are representing and explained the differences in benefits.
Before you sell Long Term Care Insurance, it is extremely important that you take the time to educate yourself not only on the various policies offered among competitors but also in understanding the very limited circumstances under which Medicare may cover some care in a skilled nursing facility.
One out of two people over the age of 65 will need some form of long term care, whether it is homecare, assisted living, nursing home care or a combination of the various levels of care.
One of the most important aspects of having Errors & Omissions Insurance is the defense that it provides to you as an insured. There are many claims made against insurance agents that are groundless; however, without having an E&O coverage policy, you, as the agent/defendant, would be left to secure your own attorney in order to be defended. Your E&O Insurer has a network of attorneys that are experienced in handling matters that arise from your profession.
Meeting with a prospect that has already expressed an interest in needing life insurance is an exciting time for an insurance agent. Once the prospect is aware of the need and has you as the agent they wish to use for securing insurance, it is extremely likely that the application will be completed and a sale will be made. As a well-versed agent you are also likely to receive referrals from this client and should not hesitate to ask for them when delivering the policy.
As an insurance agent, you face the fear of having an errors and omissions claim being made against you on a daily basis. Though, many agents will insist that they do everything by the book and have no possibility of an errors and omissions claim being made against them, the chances of being named in a lawsuit are still very much a reality. You should always conduct your business practices as a true professional and document all interactions with your clients and prospective clients.
A big part of knowing what mistakes to avoid when handling your clients insurance needs is to review errors and omissions claims that have been made against other insurance agents. We will be presenting a 6 part blog series on claims scenarios and provide some helpful information on how to avoid or mitigate such claims being made against you.
As an insurance agent, you face the fear of having an errors and omissions claim being made against you on a daily basis.
Though, many agents will insist that they do everything by the book and have no possibility of an errors and omissions claim being made against them, the chances of being named in a lawsuit are still very much a reality. You should always conduct your business practices as a true professional and document all interactions with your clients and prospective clients.
A big part of knowing what mistakes to avoid when handling your clients insurance needs is to review errors and omissions claims that have been made against other insurance agents.
August means it is back to school time. And, going back to school is not just for kids!
Here are some good tips to keep in your professional backpack:
- Seek to continue your insurance education so that you can be at the top of your game. The insurance and legal systems are forever changing as well as the products and services provided by the insurance companies represented. It is important that as an insurance professional, you make every effort to know the current industry trends. This also serves as a good risk management procedure with respect to reducing potential Errors and Omissions claims.