You got the order for the business, taking it away from one your competitors. You proceed to advise the applicable carriers that coverage is to be bound and binders are issued and delivered to the insured and the various mortgagees and loss payees. There is no doubt that you are feeling pretty good right now.
Three days later, an e-mail is received stating “after further thought, we have decided to stay with our current broker. They were able to match the premium”. Despite further attempts to secure the account, it is lost. The carriers are instructed that the coverage is not to be bound. Is that it? Is there anything further that needs to be done?
If a client decides they do not want the coverage after a binder has been issued, it is necessary that the binders be cancelled. To do this, the appropriate cancellation request/form should be sent to the applicable carriers, and notification of cancellation sent to other parties named on binder (mortgage and/or loss payee).
Without this type of notification, there is the potential that if a loss occurred, the insured or the mortgagee / loss payees could contend they thought that coverage was in place through your agency and through the carriers noted on the binder.