AOR/BOR Procedures for Benefits. For some unknown reason, I continually find Benefits Producers thinking the P&C AOR/BOR procedures are not applicable to them because the risk on the P&C side does not exist on the benefits side.
This belief is a complete fallacy. Significant risk exists, especially under the ACA. Additionally, because a much higher proportion of benefits accounts are written using AOR/BOR selling strategies, the number of accounts exposed to this risk is much, much greater. When taking over a benefits account on an AOR/BOR basis, it should be completely re-underwritten. The agency should obtain all the data they would obtain when writing a new risk in the traditional manner without copying any of the old data. The data should be gathered fresh. Otherwise, the agency may be acquiring all the old agency’s E&O errors. If the old agency was so good and did not make any errors, why would the insured be moving the business? Do you really want to assume the old agency’s mistakes?
Topics Professional Liability
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