Taking a look at what’s behind the rise in E & O claims against insurance agents helps them better prevent a suit and defend themselves in the event of one. Some estimates say that as many as one in seven insurance professionals could be named in an E&O claim during their career, while others say the probability is higher. These increased numbers in claims indicate changes in insurance industry operation and the general culture that are driving factors. 1) Rapidly changing … [Read more...]
E&O Claims Scenarios: Improper Completion of Life Application
The Claim of Material Misrepresentation on a Life Insurance Application Sharpen Your Skills With Our E&O Claim Scenarios We believe that insurance professionals can improve the service that their clients receive by sharpening their professional skills by looking over case studies and scenarios that have led to E&O claims. Facts The agent assisted his client with the completion of an application for a $500,000 life insurance policy. The application was completed and submitted … [Read more...]
E&O Claims Scenario: The Claim of Failure to Advise of Coverage Options
Sharpen Your Skills With Our E&O Claim Scenarios We believe that insurance professionals can improve the service that their clients receive by sharpening their professional skills by looking over case studies and scenarios that have led to E&O claims. Facts The agent sold the client a disability income policy, which provided benefits of $5,000 per month until age 65. The client became disabled when he was 55 years old, and the insurer commenced payments under the policy. However, … [Read more...]
E&O Claims Scenario: Did the Agent Misrepresent a Long Term Care Policy?
Sharpen Your Skills With Our E&O Claim Scenarios We believe that insurance professionals can improve the service that their clients receive by sharpening their professional skills by looking over case studies and scenarios that have led to E&O claims. Facts An agent sold his client a long-term care policy, after representing that it would provide comprehensive protection in the event that he was confined to a nursing home. The client, who was 75 years old, became ill and needed … [Read more...]
E&O Claims Scenario: The Claim of the Missing Application
Sharpen Your Skills With Our E&O Claim Scenarios We believe that insurance professional can improve the service that the client receives by sharpening their professional skills by looking over case studies and scenarios that have led to E&O claims. Facts The agent took an application for a $100,000 term policy insuring the life of the client. The application was completed, but the client was not provided with a conditional receipt or binder. The agent gave the application to his … [Read more...]
Top 5 E and O Claims Against Insurance Agents
When you are on the receiving end of a professional liability complaint, you may feel attacked, insulted or the victim of a random legal dart hurled at your business. Identifying the top 5 E&O claims shows accusations are not random - and gives you and your practice a great guide to reducing the factors that can lead to complaints. Failure to Procure Coverage Leads the List Nearly 1 of every 4 errors alleged involve failure to procure coverage, according to the Independent Insurance … [Read more...]
E&O Claim Scenario: Umbrella Claim
Facts An agent had been servicing a client’s personal insurance account for many years, which included an auto, a homeowner’s and an umbrella policy. The client terminated the auto policy as he was able to procure auto insurance from another carrier for less premium. The umbrella and homeowner’s insurance policies remained in force. As a result of the termination of the auto policy, the umbrella policy only applied in the event of a claim under the homeowner’s policy. Umbrella Policy Coverage … [Read more...]
E&O Claim Scenario: To Borrow or Not To Borrow
Facts Mr. and Mrs. Smith are high net worth individuals. Much of their wealth, however, is in real estate. A few years ago, they met with an Insurance Agent who identified a life insurance need. Based on their situation, the Agent concluded that the Smiths could use $5 million in life insurance coverage. The Agent recommended a whole life policy that earns dividends and builds cash values. Based on their age and health, the annual premium for such a policy was $175,000. The Smiths did not … [Read more...]
E&O Claim Scenario: Know What You Are Selling
The Massachusetts Supreme Judicial Court recently issued a decision affirming the potential liability of an insurance agent and insurance company for oral misrepresentations made by the agent. In that case, the plaintiff alleged, and the trial court found, that the insurance agent had misstated the benefits provided by a life insurance policy; assuring the plaintiff that the policy provided a $500,000 death benefit when, in fact, it provided only $200,000. Despite the existence of policy … [Read more...]
Get Insured 24/7 Offers E&O Aggregate Limit of $3 Million
There appears to be movement in the insurance industry to ask insurance agents to increase their coverage limits on their professional liability insurance. Some carriers have recently required a $3 million aggregate limit for some of their life and health agents and other companies could follow the trend. That's Why We're Offering a $3 Million Aggregate Coverage Limit Now We’ve commenced offering an aggregate coverage limit of $3 million option to accommodate those Life and Health Agents who … [Read more...]
