Imagine that you are in the middle of the ocean and a hurricane is approaching. Would you rather be in a battleship or a rowboat?
This analogy could apply to the Independent Agent’s E&O insurance marketplace.
Unprecedented financial conditions, including the lowest interest rates in 70 years, a pandemic with unresolved insurance implications, and social inflation are all factors that portend stormy seas for the insurance business.
Your agency’s E&O policy could prove to be a vital life preserver or insufficient during stormy times.
The Agents’ E&O marketplace is subject to the same conditions affecting the rest of the insurance industry and with all the uncertainty in the industry, now is the time to examine the provider behind your E&O coverage.
Here are some things to consider:
- How long has the provider been providing E&O coverage specifically for independent insurance agents? If less than 10 years, they may not be a long-term player and could leave you without a renewal proposal at the wrong time if they decide to exit the E&O marketplace.
Several carriers have withdrawn since the first of the year, demonstrating that we are already seeing the affects of the storm. There are also some program managers with the habit of switching carriers every three or four years, which can be reflective of not following underwriting guidelines or poor loss ratios. Either case could leave you searching for replacement coverage in the middle of the storm or worse, with a higher probability of an uncovered claim.
A long-term relationship is a valuable asset in turbulent times. IIAT has represented the interest of independent agents in Texas with a variety of carriers for over 25 years.
- What is the claims handling reputation of the carrier? Which law firms might they use to defend you in the event of a claim? The list of good Agent’s E&O defense firms in Texas is fairly small and the good firms are well known. Can your E&O provider provide guidance in this area?
- Has your E&O carrier indicated a potential reduction in coverage, such as the addition of exclusionary language? If so, it may be time to review your options.
Your IIAT Advantage E&O team has access to a variety of E&O markets in Texas. If you have questions about your current provider, please reach out to us. We have been through tough times with agents in Texas before, and we’re here to help you, when the skies are stormy or full of sunshine!