Virtually every agency establishes goals and objectives they plan to accomplish with most of those goals probably dealing more with premium volume, new business, income and expenses. While the establishment of these goals is important, serious consideration should be given to the setting of E&O goals; issues and initiatives that will play a role in minimizing the potential for the agency to face an E&O claim.
For every agency, the goal will probably be different based on where that agency is in their E&O loss prevention efforts. Some initiatives to consider:
Staff Education – your clients are looking to your agency for knowledge and expertise. To provide that, the applicable staff need to possess that knowledge. While growing in technical knowledge is certainly important, other staff education issues might include possessing stronger customer service skills and automation skills. For this reason, the education objective should be customized for each staff member.
Advise clients of other coverages to consider – this initiative heavily deals with customer accountability. It also serves as an education tool. Oftentimes, a list of other coverage to consider is included on the new or renewal business proposal.
Securing customer signatures on applications – this issue is key as most courts will hold the customer accountable for the contents of the application if their signature is on that application. Thus, if there is a misstatement on the application that the client signed, this could play a key role in the defense of the agency if a problem were to develop.
Confirmation of rejected coverage – every agency should have a procedure that requires all rejected coverages to be memorialized in some written form of communication back to the client.
Getting updates at renewal time on any change in exposures – face it, your client’s exposures can change drastically from one year to another. To “keep up” with these changes, many agencies have designed a form that is automatically sent to each personal and commercial lines customer 60-90 days prior to the expiration of coverage. The goal is to secure an update of any changes in exposures so that insurance discussions can take place.
For many agencies, the development of a strong E&O culture takes time. By establishing and accomplishing E&O goals each year, your agency will be closer to achieving the desired level of E&O commitment.