Have you had a client whose claim was denied but you felt really uncomfortable about the coverage determination?
I have been working on quite a few denied claims in the recent future. It have become apparent to me that Insurers are using a strategy to issue a “bluffing letter”. It looks like a denial and will discourage all but the most resolute Insured or Agent.
The letter basically says, “We don’t this covered and gives a litany of reasons.” We will not indemnify or defend this claim….!” The Insured files it and basically goes away without questioning it. Some of these claims should be covered. I have gotten several paid recently and in some we have filed suit. (Of course, there are also many legitimate denials.)
Agents… Don’t let your Insureds be taken advantage of this way. ALWAYS follow up and when you need to involve an insurance expert such as myself, call us!. “My business is knowing your business”. Let us help you protect your Insureds! We can likely keep you out of an E & O claim!
For over ten years I have been discussing the “narrowing” of coverage due to the increased pressure from reinsurers and rating agencies for increased profits and decreased loss ratios. One of my key examples has been a broadening definition of “pollution”.
In the past two months I have either been involved in or heard of several claims being denied for “skunk spray”. This is a perfect example of profiteering. A skunk is neither a vermin nor is skunk spray pollution. But, beware… Some have denied altogether and some have denied coverage for contents, EVEN WITH AN HO 15 ENDORSEMENT!
As time goes on, it is clearer and clearer to me that there is a need for an Agent to visit a client at the time of sale and a need for an Adjuster to visit a client at the time of claim (as well as the Agent). I am fighting my way through a half million dollar liability claim (as an expert witness) attempting to get the Insurer to reverse a denial from three years ago. The claim was wrongfully denied and the Agent did not step into it until now! The only reason for a denial was that the Insurance Company Adjuster chose to do no investigation at all. Even a conversation with the Insured would have uncovered facts rendering some insurance coverage. This is absurd. It does not even meet the basic obligations of the Insurance Company upon notification! They simply did not have adequate information to make an informed decision. We simply cannot handle these complicated transactions totally over the phone or on the internet! WE NEED TO GET BETTER!
If you discontinue the purchase of General Liability Policies due to retirement or going out of business, among other reasons, be cautious if the insured still has products in the marketplace. Canceling the General Liability will terminate coverage for occurrences that happen in the future due to your insured’s products.
At termination you need to have your client purchase discontinued operations coverage. The coverage is no longer even in the ISO manual, and I think I must be one of the few who still remembers how it was rated. Insurance Agents… Plug this potential E & O Gap by offering the coverage and documenting the offer in your insurance file!
Fear in organizations ruins strategic initiatives. Self interest and fear run together. I am not talking about people literally quaking in their boots, I am talking about people being afraid that YOUR strategic initiatives will undermine their position or their power. Fear is a drastic impediment to teamwork! Fear is a terrible impediment to living our lives fully.
Seek out the fear in your organization. Communicate at all levels openly. Make communication the norm and accept it without judgment. Fear destroys initiative. FOLLOW the FEAR you’ll FIND the problem. What are the FEARS in your organization? Can YOU really find out?
In our strategic planning sessions, we find fears and make them advantages!
Your people will not tell you their fears unless they feel safe. Be an effective leader and learn to listen.
