Agency Carrier Contract Sample – Hold Harmless • We agree to hold you harmless against civil liability for damages and expenses, including defense costs as a direct result of our error or omission arising out of: • Preparing, processing or handling any insurance contract, application for insurance or billing procedure covered by this agreement. • Our failure to comply with any applicable law • Our inspection services or surveys or those of our sub- contractors • Our services or the services of an independent adjuster we hire…
Agency Carrier Contract Sample – Hold Harmless • We will not protect you to the extent you contributed to or caused the error or omission • We will not hold you harmless when incorrect information you provide us results in an adverse decision • You must notify us promptly if anyone makes a claim or files suit against you based on our error or omission • We will not hold you harmless if you admit liability
Agency Carrier Contract Sample – Termination • We may terminate agreement with 180 days notice • For any reason not prohibited by law • Change of ownership more than 50% • Change of legal entity • If you fail to comply with the terms of this agreement • Agency Agreement automatically terminates without notice if the agency files for bankruptcy or bankruptcy protection
Agency Carrier Contract Sample – Miscellaneous Provisions • Compliance with Applicable Law • Advertising – No authority to employ, reproduce, display or use our trademark, service mark, logo or other identifying symbol in any manner whatsoever with written consent
Agency Carrier Contract Sample – Miscellaneous Provisions Privacy – Company agrees to keep agency information private • You agree not to disclose confidential information including but not limited to: • Customer information (All) Driving records, names, addresses, loss history, policy limits
Agency Carrier Contract Sample – Arbitration of Contract Disputes • If a dispute arises we agree to make every effort to meet informally and settle our dispute in good faith. • You and we may agree to submit the dispute to one arbitrator, otherwise there will be three • Determination by arbitrator shall be final binding on all parties • The cost of arbitration shared equally
Agent/Carrier Relationships: Law Of Agency
Introduction Carrier Agent Carrier Carrier Client
Establishing An Agency Relationship
The Law Of Agency Insurance Agents have duties to both the carrier and the customer, but never simultaneously . Agent
The Law of Agency Obligation to Company Obligation to Customer • Fiduciary • Proper Coverage • Loyalty • Adequate Limits • Honesty • Prompt Communication Like Marriage Vows Good Business Practice • Love • Right Policy • Honor • Right Limits • Obey • Transparency
Compliance with State & Federal Laws
Introduction
Compliance with State/Federal Laws Non-Compliance Opens the Agency Up to: • Fines • Loss of License • Potential Criminal Penalties • Damage to Reputation • Loss of Customers
State Laws Unfair Trade & Claims Practices: South Dakota – Chapter 58-33 & 58-33-67 • Deceptive • Misleading • Misrepresentation • Defamation • Twisting • Discrimination • More
State Laws Unfair Claims Practices: Communications Deny or Affirm Claim Payments Misrepresentation
Federal Laws Fair Credit Reporting Act (FCRA) Motor Vehicle Records Credit Reports – Credit Scoring
Federal Laws Gramm-Leach- Bliley Act (Financial Services Modernization Act of 1999)
Federal Laws Sarbanes-Oxley Act (SOX)
Federal LAWS Electronic Signature in Global and National Commerce Act (ESIGN)
Federal Laws Telephone Consumer Protection Act (TCPA)
Federal Laws CAN-SPAM Unwanted Emails Advertising HIPPA Security of Health Data
Reporting an E&O Claim
Introduction
Myths vs. Reality
The Cost of Reporting Cost of Reporting Cost of Not Reporting
Concerns of Loss of Policy Premium Credits
When It Happens To You • Do not admit liability • Be empathetic • Do not discuss or provide copies of your E&O policy to anyone • Do not offer to pay the claim yourself • Do not agree to give a deposition or provide a statement • Involve • Report • Appoint E&O • Forward Agency Carrier • Interview • Cooperate • Narrative
Attorney “If they are not your attorney, they are not your friend”?
Documentation Can Reduce Deductible Swiss Re Agency 50% 50%
Agency Defenses: Documentation
Agency Documentation Avoiding the “He Said” / “She Said” arguments
Let the File Tell the Story • Prospect • Marketing Information • Applications • Quotes • Proposal • Acceptance or Declination • New Business • Order to Issue • Policy Received • Policy Checked • Policy Delivered
What Makes Documentation Complete? Who What When Why Where How
What types of communications should be in the customer file? • In-person • Faxes (traditional Discussions and electronic) • Phone Calls • Text Messages (landline and • Websites mobile) • Social Media • Emails • Voice Media • Instant Messages • Live Chats
Characteristics of Proper Documentation Clear, Concise, Consistent No Jargon Unalterable date/time Recreate the Transaction Same System and Procedures Policy Information and Transactions
Things To Avoid Claim Opinion Going to Bat on Denied Claim Personal Asides and Comments E&O Claim Information in Customer File
Customer File New Business Renewal Limits & Checklists Values Claims Endorsements
Documentation And Your Deductible Up to $12,500 Reduction Reduce 50% 50% Retain
Electronic vs. Paper Files
Admissibility of Electronic Files • Electronic more credible • Date and time embedded • Copies not necessary • Scanning viable • Secure personal information
Electronic Signatures ESIGN enacted in 2000 Electronic legal and enforceable Federal Law
Customer Sign-off, Acknowledgement Forms, and Written Follow-up Coverage Exposure Declined Documented Offered
Signed Applications
Use Of Disclaimers NO • Voice Mail BINDI • Website NG • Fax, Email and Instant Message • Claims Reporting • Social Network Read Your Policy • Proposal
Customer File Retention
Documentation Retention Considerations • Agency Policy, Carrier Requirements & Legal Obligation • Electronic files should be purged • Good documentation saves / Poor documentation sinks • Personal Information required to be protected
Disposal Of Customer Files Use Qualified Document Destruction Company
The Role of Agency Procedures
Introduction Good Procedures Improved Good Customer Policies Service Documentation E&O Claims Efficient Defense Operation Audited for Compliance
What are “Invariable Practices”?
Why are “Invariable Practices” Important?
Procedure Manual: Training Tool
Procedure Manual: Reduction of Operating Costs
Procedure Manual: Employee Evaluation
Procedure Manual: Agency Operations Audits
E&O Issues of Certificates of Insurance
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