No one wants their client to accuse them of acting negligently or delivering inadequate services, but in the insurance industry, errors and omissions claims are common. Common concerns are with the valuation of the property and determining the correct limit, not informing a carrier of a risk issue or submitting incorrect information on an initial coverage application. While these may seem to be problems between the local and agent and insured, wholesalers and brokers have similar concerns.
Challenges and Claims
Brokers and wholesalers give advice on policies or explain the contract in detail, but missing important information or making a mistake on a form could lead to litigation for oversight or errors. Third-party suits against brokers and wholesalers for professional negligence are possible and establishing a defense is costly. With e&o for insurance wholesalers and brokers, the financial responsibilities of addressing claims or litigation are addressed. Features of this coverage can be customized to your operation’s exposures, potentially saving you thousands of dollars in legal fees and settlement payments.
Risk Management Options
Just as insurers advise their clients on risk management strategies, having processes in place to reduce the potential for errors can minimize the threat of an E&O claim. Work in the area of expertise, keep detailed notes and files and clearly outlining exactly what service you and a client have agreed to.