What Agents Need to Understand About E&O Insurance Coverage
E&O insurance coverage protect agents financially when facing a legal lawsuit. Working professionals such as insurance agents can and do make mistakes sometimes. However, they come with a heavy cost. These mistakes or errors are mainly un-intentional and hence go unnoticed. However, some are deliberate practices that must be avoided at all costs. There are many insurance agents out there, but your clients chose you over others and hence it is your responsibility to provide them the right coverage. When failing to do so, it is not only trust that you lose, but also valuable time and money. In addition to this, your reputation and your status can take a big hit, forcing carriers to drop out of the partnership in order to save their own reputation. Nevertheless, e&o insurance coverage is always there to protect agents financially if an agent ever found themselves in the pit.
Many agents are under the delusion that because they are trained professionals, mistakes from their behalf is not probable. This leads them to believe that policies such as e&o insurance coverage is not required. Agents do indeed try their best in order to provide the best coverages that meets their client’s requirements. However, mistakes do slip past unnoticed and can land you in the mud. This is why remaining protected by e&o insurance coverage is extremely crucial. It is just like the saying goes “better safe than sorry”.
Here are a few guidelines to follow in order to avoid committing mistakes and falling victims to legal lawsuits and having to file for e&o insurance coverage.
Agents must provide equal priority to all their clients and spend enough time to gather all the necessary information. This helps agents to accurately identify the risks and the types of coverages required by their clients. Failing to do so, often leads to coverages being left out which result in a lawsuit.
Meetings and training programs to help develop risk and exposure assessment skills can go a long way. The root of all e&o lawsuits is the lack of agent’s expertise on risk and exposure assessment. Agencies and agent must conduct such programs to help avoid such mistakes.
Documenting every step of the purchase and monitoring carrier reputation on a daily basis is extremely crucial. According to Get Insured, while documentation eliminates the risk of losing valuable information, it also acts as an evidence when an e&o claim is made. On the other hand, agents must also constantly monitor their carrier’s reputation and their service in their market.
Agents must always prepare their sales process with due diligence, even while remaining covered by e&o insurance coverage. In addition to this, according to Think Advisors, agents must constantly monitor their carriers. Agents must make sure they have reputed carriers backing up their coverage.
However, there are times when attending a court date is inevitable and agents must answer the claims made against them. These are time when agents either take the related documents to the court to prove their innocence or admit guilty to the claim made against them.
Under such circumstances, agents can ask their lawyer to dismiss the claim if they believe the evidence is weak. However, such cases are rare and do not occur regularly. The other options left would be to either settle the claims outside of the court or resort to e&o insurance coverage to help avoid financial breakdown if things do not go your way.