View this article online: https://www.insurancejournal.com/blogs/agency-e-o/2013/09/05/304121.htm
Producers Not Having Adequate Knowledge of their Clients’ Industry. An agency can have all the right procedures and even follow all the right procedures and still not mitigate one of their biggest E&O exposures: Producers writing accounts for which they lack adequate knowledge. In fact, one of the biggest E&O claims I have ever seen was the result of a producer completely lacking adequate knowledge of the key exposures specific to his client’s industry. He followed all the procedures perfectly but if a producer does not understand the exposures, he is unlikely to know how to properly design coverage. An agency can often materially decrease their E&O exposures if producers are not allowed to write accounts in industries for which they have limited knowledge. Good examples of this are producers who have no trucking experience writing trucking accounts. Another example involves oil and gas accounts. Another good example involves restaurants and food processing. To write accounts correctly, a producer has to understand that account’s exposures and to understand exposures, a producer has to learn that industry.
Besides, when a producer knows the industry, he or she looks a lot smarter and more professional.