Sadly, insurance agents and brokers are under constant scrutiny any time they make an error or omission in providing their services. The issue becomes magnified when a huge disaster hits, like last years hurricanes, affecting a large community with the need for filing multiple claims almost simultaneously. While a certain standard of care should be expected from their agents or brokers, circumstances being what they were, things probably didn’t move quickly enough for the multitudes suffering through these events.
With so many people displaced from the damage and flooding that occurred, agents were in a bit of a quandary, with response time slowed as they worked through claim after claim. Tempers were short as customers became frustrated with what they believed was an inefficiency in response time.
Many clients likely found themselves under-insured at the time of the crisis and believe that their agent did not make them fully aware of the risks and exposures they faced. This is a prime example of the need for insurance agency e&o.
Why have Insurance Agents E&O?
Listen, it doesn’t take a major disaster to express the need for errors and omissions insurance. Professional liability coverage is an important component for many businesses, and perhaps especially for an insurance agency. Mistakes can be made simply while helping others to find coverage.
If you were to wind up being sued, and didn’t have the right type of protection in place, your agency would have to retain any suit or other claim occurring, which could mean having individual agents lose money on their commissions. This wouldn’t happen with an E&O policy in place. Most negligent acts would be covered while helping to keep the business operating continuously.
Agents shouldn’t be at risk
Insurance agents and brokers are held to high standards due to the services they provide. They may, at one time or another, be uniquely exposed to claims frequency and claims severity. Many carriers offer E&O coverage, but not all E&O policies provide the same level of protection, especially in what they’ll actually cover if a claim winds up in litigation.
Some policies may pay for the settlement amount, but not your defense expenses, such as attorney’s fees. Others pay defense expenses but not for the actual losses incurred. Comprehensive insurance agency e&o coverage will pay for all of it. Talk to a specialist about any questions or concerns you may have.