P & c questions

[pc insurance]

I have a claim and the policy expired back in3/3/2012 the company just did not renew it. No cancellation was sent out or notice of non-renewal or anything is on record of being mailed or e-mailed. I no longer have a contract with this company. It just got missed by the company, us and the insured. The loss is around $400,000. Is the carrier responsible for this claim because no renewal, cancellations or anything being mailed out? I don't want to contact E&O. Any suggestions

 

[Josh]

First, I wouldn't rely on anything anyone posts here. So after disqualifying my own response, here's what it looks like to me:

In most states an insured is required to provide a non-renewal notice to the insured. In addition to that, what happened with the payments? Did the insured have this on an auto-debit and then have it not come due? If the insured did not receive the notice and did make their regular payments at the regular time, there is precedent for them to expect the claims to be paid. On the other hand, if the insured stopped receiving bills and stopped paying the bill, it's hard to imagine how the insured could have expected to have coverage.

You may want to contact the carrier and ask for a copy of the notice of non-renwal and/or whatever other compliance documentation they believe they sent to notify the insured (it's very unlikely they didn't do this). That's where I would start.

 

[djs]

Sorry I missed this earlier....
Just curious, when you say there was no renewal notice (or other documentation), are you saying the insured didn't receive it or that the carrier didn't send it?

If you no longer have a contract with the carrier, they may not have sent the notice to you, but should have the current agent on file for the policy. I know I have some policies I haven't managed for years but I still get notices on them, then others, nothing at all.

Odds are, they reassigned this policy to another agent or to an in-house account. I would find out where the policy was sent and have your ex-client contact their new agent for support.

Also, if the carrier non-renewed, odds are, they sent the appropriate notice, but it may have gone to the wrong address.

Dan

 

[pc insurance]

Hi Dan,

The carrier just didn't send a notice of non-renewal or cancelation or any documentation to the insured or to our agency. They admitted it to us. It just expired. The agency didn't discover it was expired until they called the claim in. We called the company and the person we talked to had said it looks like they dropped the ball and didn't renew the policy.

 

[BlockO]

pc insurance,

when was the date of loss? -important because the policy expired 14 months ago. if this is a recent claim, the insured would have a hard time explaining how they didn't know their policy had expired.

what state are you in? -important because laws vary about what documentation is required to be sent to the insured, and in what form (mail vs. email). most states require non-renewal and cancellation notices to be sent to the insured in one form or another. but i highly doubt you will see many "renewal offer" requirement laws on the books (because there would be no incentive for an insurance company to violate such a law).

did the insured have EFT automatic bank withdrawals set up?

 

[b61mack]

Didn't he notice he wasn't paying the premium? How did he renew his license plate, without showing prove of insurance? Doesn't pass the smell test. He is a poster boy, for not paying your premiums.

 

[Milkman1265]

Hi Dan,

The carrier just didn't send a notice of non-renewal or cancelation or any documentation to the insured or to our agency. They admitted it to us. It just expired. The agency didn't discover it was expired until they called the claim in. We called the company and the person we talked to had said it looks like they dropped the ball and didn't renew the policy.

if this was the case, did they say over the phone or by email? i would ASSUME the carrier will make right and pay the claim and deduct the premium for that year. i dont know seems like the ethical thing to do right?

but i dont know if this is what a carrier will do, no body likes to lose money.

but for me i can see it in the insureds eyes that sometimes they forget to pay if they never got a bill. people forget things.

but i'll like to know how this situation turns out....

just noticed someone said this is auto? im confused is this auto or home?

 

[djs]

Did they not send YOU the notice or not send it out at all?
I find it hard to believe they didn't send out any notice at all to anyone. Wording will mean a lot here.

Also I missed the fact that this expired over a year ago. I think the client owns this loss. If not, nobody needs to pay their premiums going forward, just claim that I wasn't notified.

I've gotten a few claims paid on expired policies because notifications where messed up, but it was always within a 'reasonable' time and there were obvious attempts to correct the problem. For instance, I had a client attempt to pay his bill, messed up his bank account number, the payment 'bounced', and the system instantly cancelled the policy with no 'grace' time which would have normally been applied. He had to prove he had the money to make the payment, if it had been entered correctly. They reinstated the policy, no lapse, paid the claim.

Simply not receiving a bill is not reason enough though. State law may trump this, but after a year or so, I doubt it.

Dan

 

[EugeneM]

Do you care about the client. Is it worth it to you to help the person? I dont think it is fair for you to trouble yourself - Business Owner policy holder is responsible 100% I guarantee you he noticed the premium was no longer coming out... no way you dont notice you have more money then you should.. I agree with b61mack. However if you care about them you can spend some time on it.

 

[b61mack]

What kind of claim is this for, auto/ home. Watch what you say to the client! It is nice to look into it, but, You are talking yourself into E&O problems. Step back and let the insurance company handle it. If you said to the client what you said here, you may have just bought a 400k E&O claim.And that would put you out of business.