Technology Technicalities

Technology can make or break your agency's errors and omissions mitigation procedures.

Technology helps insurance agents and brokers service accounts more efficiently.  It helps us issue policies and market our products. However, it is only as good as its user. One error can have a lasting effect on the whole process. I remember a Georgia claim  involving EPL (Employment Practices Liability) coverage added by endorsement to a policy.  The agency's internal system reflected that EPL coverage was in place.  When the agency moved the account to another carrier,  their policy no longer contained EPL coverage.  However, the broker relied on the agency's system and assumed that a standalone EPL policy had been issued. When the customer was sued by several former employees and had no insurance coverage, the error came to light.  As a result, the agency  faced a high exposure claim.  In this case, technology provided the information, but the user failed to confirm its accuracy.

Similarly, renewal time can come with its opportunities and challenges.  It is a great time to market new coverages, recommend that customers reassess their insurance needs and to protect yourself from a future claim. A renewal letter is an excellent example of using technology to meet your clients' needs. Rather often, a client rejects  umbrella coverage, but later insists that such coverage was never recommended.  Issuing letters recommending umbrella coverage at renewal will help dispute such a claim.   For example, a New York claim argued that in 2008 the coverage was offered and rejected. However, we do not have any communication to prove that the coverage was offered. Sending a renewal letter would have addressed that discrepancy.

Today, websites, social media and e-newsletters are common marketing tools that promote your products and offerings. They can also help your clients understand the insurance that you offer better.  In a California claim, an agency placed workers compensation insurance for a rehab facility.  The agency placed the coverage and helped the client develop its workers compensation program.  However, the client did not understand the process resulting in misclassification of certain employees.  That led to claims against the client and a corresponding claim against the agency. Educating your clients and providing resources on your website and e-newsletters to help them better understand what they are purchasing can help minimize such misunderstandings. The clients also appreciate access to such information as it empowers them to make better informed decisions.

With many of us working from home right now, we rely on technology more than ever before.  In this time of less face-to-face contact, the way that agents and brokers use their resources can make (or break) them. To make the best use of what you have available, know the limits of your technology and continue to communicate with your teams and  your clients. 

If you have any questions, please contact us at eo@iiaba.net. 

Donna Asta is vice president and claims expert at Swiss Re Corporate Solutions and works out of the office in Chicago, Illinois. Insurance products underwritten by Westport Insurance Corporation, Kansas City, Missouri, a member of Swiss Re Corporate Solutions.

Look, A Useful Chart!
Policy change errors and policy renewal errors account for almost 20% of total claims in total loss amount.

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