My E&O situation. Is this a fair deal?

[somarco]

Some of the deals thru carriers either cover you only for writing THEIR contracts, not with other carriers. Or the coverage is limited for business written with other carriers.

My personal opinion is E&O has a very slim chance of ever paying. If you read the policy you will see enough holes to drive a bus through. But most carriers require it so you really have no choice but to pony up.

 

[cadylou]

True

You have to read them pretty carefully. The way mine reads is that it will take care of all of the product sets that I write, but it stipulates that you have to be contracted with that entity (i.e., Blue Cross, Aflac, etc) whenever a claim is made.

At least that's the way I read it. I just hope I never have to claim anything . . . .;-)

 

[somarco]

Read further. Pay particular attention to the exclusions. Some policies will not pay for your defense, until you have been found guilty.

 

[Crabcake Johnny]

Some of the deals thru carriers either cover you only for writing THEIR contracts, not with other carriers. Or the coverage is limited for business written with other carriers.

My personal opinion is E&O has a very slim chance of ever paying. If you read the policy you will see enough holes to drive a bus through. But most carriers require it so you really have no choice but to pony up.

Correct. E&O really only covers unintentional mistakes and the first thing your carrier will try to show is it was intentional or you were derelict.

New agents think they're covered for things they're not covered for. If you wash an app, recommend a limited plan just based on commission without going over the limitations or simply fail to do your job it'll be on you. I've heard some unethical agens say "the client has a job to read the policy - I don't have to go over everything." Do you think a jury would agree with you? Remember that lawsuits are not criminal trials but civil. OJ was acquitted criminally but found liable in civil court.

Say you sold a health plan to somone with a few pre-ex conditions and they asked about doctors being in-network. But you're lazy so instead of running searched you just say "it's a huge network and your doctors will be in there." Plan is issued and come to find none of their doctors take the plan. Maybe you sold an Aetna plan and the only network available is Aetna - no other network to swith them to.

However, they found this all out months later after they saw their doctors and got EOBs from the insurance company stating they owe a lot of money due to balance billing. Now they want to sue.

In this case you're screwed and your E&O company wouldn't do anything.

Here's some CYA moves I do when I sell:

*I send all my clients either the links to the plans and rates or mail the brochures. This gives them days to read over the coverage.

*When I recommend a specific carrier I explain why. It's someone is pre-ex and will get ridered by GR I explain that I'm putting them with Assurant because it'll be covered. If someone wants maternity I'll explain that GR doesn't have it, Assurant puts a waiting period on it therefore I recommend Aetna. If someone's "broke" I recommend Blue Cross Person Comp and explain and show that it's the only plan that fits their income.

If you're dealing with an "income challenged" client BE WARNED!!! These are the clients who cannot handle bills and the first ones to want to sue. When I deal with the income challenged I ALWAYS show them comprehensive plans first, then explain what the limited plans don't offer in exchange for a lower price. A mistake would be to not show them any other plan except for the "cheapie." Then the shit hits the fan and your client says:

"I would have gladly paid $60 more a month but my agent never showed me other plans."

 

[cadylou]

Very good guidance

Thanks John - that's great advice. I've tried to be thorough & present as much as possible, but haven't done everything you have suggested here. Now, I will, of course.

 

[NHB_MMA]

Here's some CYA moves I do when I sell:

*I send all my clients either the links to the plans and rates or mail the brochures. This gives them days to read over the coverage.

*When I recommend a specific carrier I explain why. It's someone is pre-ex and will get ridered by GR I explain that I'm putting them with Assurant because it'll be covered. If someone wants maternity I'll explain that GR doesn't have it, Assurant puts a waiting period on it therefore I recommend Aetna. If someone's "broke" I recommend Blue Cross Person Comp and explain and show that it's the only plan that fits their income.

If you're dealing with an "income challenged" client BE WARNED!!! These are the clients who cannot handle bills and the first ones to want to sue. When I deal with the income challenged I ALWAYS show them comprehensive plans first, then explain what the limited plans don't offer in exchange for a lower price. A mistake would be to not show them any other plan except for the "cheapie." Then the *** hits the fan and your client says:

"I would have gladly paid $60 more a month but my agent never showed me other plans."

That is some good advice. The nice thing when you send an e-mail with the brochure links is you have a copy of proof that you provided the info.