I generally agree with my esteemed colleague. However there are even more dangers for the Broker/Agent pursuant to the Third Eye Blind case in Caif. In essence, Agents & Brokers are defacto the guarantors of Insurer good claim handling. In the aforementioned case, an Insured was denied coverage on a claim after being assured by the Broker (at time of sale) that the peril of concern was covered by the Policy. A loss regarding that peril was later denied and the Insured sued the carrier and won! The Insured also had filed and alternative E&O Claim against the Broker. The Agent assumed that since the Insured won his case against the Insurer the case would be “over” against Broker- NOT TRUE! The Court reasoned that ” we are required as brokers not to ” fail to alert the ( Insured) that the ( Policy has language that provides a viable basis ) for refusing coverage under some circumstances and, consequently, failed to recommend that the(y) purchase ……… insurance to ensure complete, uncontestable coverage.”
What I would like to have is a ‘claims guide’ for agents and brokers. This would give the time limits involved (in your state) for things like ‘how long from receipt of estimate does a carrier have to make a collision offer?’ The time limits involved in claims are unknown when an insured asks us. Also, what is thye auto ‘total loss’threshold? What % of the value? How long after an agreed figure is reached does the insured have to accept the offer and what are their alternatives, etc. Not real nitty gritty specifics, but a general list of definitions and the time elements involved for proofs of loss, appraisals, etc. How about it state insurance depts and/or carriers? I have been asking for this info for years and I get piecemeal info. The claims regs are by state so one would not need carrier specific answers. Why isn’t such a handbook available anywhere?
The NAIC model Fair Claims PRioctices Act adopted by most States generally requires that any communication as respects a claim be responded to immediately not to exceed 15 days. In Calif.’s version, the Regulations apply to all licensees yet many Brokers are unaware of that fact. Further, most are unaware that anyone “involved in claims handling”, even if limited to processing same on to the appropriate carrier, must certify they are trained to comply with the Regulations.
Not withstanding the above, policy provisions themselves may also dictate how, when and where claims must be reported. More and more Courts are enforcing these provisions, even going so far as to uphold denials where a claim as included as part of a renewal submission to the Insurer’s Underwriter, but was not sent to the designated claims address.
Such issues were addressed in my recent IJ- Academy of Insurance Webinar on “What to expect from Specialty Lines Claims” which targeted the Broker audience. A copy of their Webinar is available at their website:
As the person responsible for all claims in our 8 offices, I have simplified the instructions and there are no exceptions. If you have a policy in force and an insured notifies an agent of a claim, it gets reported, “no ifs ands or buts.” The retail agent is a legal agent of the insurer. Knowledge to the agent is knowledge to the company. Do I get push back? Yes sometimes, but what I dont get is E & O claims for failure to give notice.
daughter has auto ins. hit on i95 back in 2008. suv repaired but not right. last year stopedfor red light and was hit from behind. ins company wont stand behind her policy. state it is in the policy(contract which has never been told to her or anyone else she knows that has this large ins company)) to put used parts on…like she has a bent frame..engine radiator are falling. cant be driven. has had 1 operation and still needs another. also told the other car that was hit was a lexus and this ins company paid out so much money to have it repaired that there is little money left to repair daughters suv. why can ins companies get away with this? she lives in a no fault state and has coverage and nothing is being done..and due to the ins company she has not had her suv in just about a year! THIS STINKS……ANY IDEAS?????? am interested in the E & O insurance claim. Anyone out there know of one in S Florida that would handle this for her???? H E L P
What is being missed here are statutory, regulatory and policy language issues. Years ago, the NAIC adopted Fair Claims Practice Statues that may also have given rise to further regulatory mandates. In Calif, any communication regarding a claim must be addressed immediatley not to exceed 15 days. Unbeknownst to most Brokers is the fact that all licensees are subject to these regs. Anyone involved with claims, including the Clerk at a Brokerage firm who submits claims to the Insurance Company, is required to be trained in the Regs.
Policy language too may set forth how, when and where claims are to be tendered. Courts have recently ruled a claim may be denied for failure to follow Policy requirements. One Court recently ruled a claim that had been submitted as part of the renewal submission to the Insurer’s Underwriter could be denied as not having been reported in accrdance with Policy provisions.
These isses were addressed by me recently in an IJ Academy of Insurance Webinar I gave 3 weeks ago on Specialty Lines claims from a Brokers perspective. HTe Webinar is available for download at their Webs site.
I generally agree with my esteemed colleague. However there are even more dangers for the Broker/Agent pursuant to the Third Eye Blind case in Caif. In essence, Agents & Brokers are defacto the guarantors of Insurer good claim handling. In the aforementioned case, an Insured was denied coverage on a claim after being assured by the Broker (at time of sale) that the peril of concern was covered by the Policy. A loss regarding that peril was later denied and the Insured sued the carrier and won! The Insured also had filed and alternative E&O Claim against the Broker. The Agent assumed that since the Insured won his case against the Insurer the case would be “over” against Broker- NOT TRUE! The Court reasoned that ” we are required as brokers not to ” fail to alert the ( Insured) that the ( Policy has language that provides a viable basis ) for refusing coverage under some circumstances and, consequently, failed to recommend that the(y) purchase ……… insurance to ensure complete, uncontestable coverage.”
WOW!
Frederick Fisher
ffisher@e-o.com
What I would like to have is a ‘claims guide’ for agents and brokers. This would give the time limits involved (in your state) for things like ‘how long from receipt of estimate does a carrier have to make a collision offer?’ The time limits involved in claims are unknown when an insured asks us. Also, what is thye auto ‘total loss’threshold? What % of the value? How long after an agreed figure is reached does the insured have to accept the offer and what are their alternatives, etc. Not real nitty gritty specifics, but a general list of definitions and the time elements involved for proofs of loss, appraisals, etc. How about it state insurance depts and/or carriers? I have been asking for this info for years and I get piecemeal info. The claims regs are by state so one would not need carrier specific answers. Why isn’t such a handbook available anywhere?
The NAIC model Fair Claims PRioctices Act adopted by most States generally requires that any communication as respects a claim be responded to immediately not to exceed 15 days. In Calif.’s version, the Regulations apply to all licensees yet many Brokers are unaware of that fact. Further, most are unaware that anyone “involved in claims handling”, even if limited to processing same on to the appropriate carrier, must certify they are trained to comply with the Regulations.
Not withstanding the above, policy provisions themselves may also dictate how, when and where claims must be reported. More and more Courts are enforcing these provisions, even going so far as to uphold denials where a claim as included as part of a renewal submission to the Insurer’s Underwriter, but was not sent to the designated claims address.
Such issues were addressed in my recent IJ- Academy of Insurance Webinar on “What to expect from Specialty Lines Claims” which targeted the Broker audience. A copy of their Webinar is available at their website:
http://www.ijacademy.com/what-to-expect-from-specialty-lines-claims
Frederick Fisher
ffisher@e-o.com
As the person responsible for all claims in our 8 offices, I have simplified the instructions and there are no exceptions. If you have a policy in force and an insured notifies an agent of a claim, it gets reported, “no ifs ands or buts.” The retail agent is a legal agent of the insurer. Knowledge to the agent is knowledge to the company. Do I get push back? Yes sometimes, but what I dont get is E & O claims for failure to give notice.
daughter has auto ins. hit on i95 back in 2008. suv repaired but not right. last year stopedfor red light and was hit from behind. ins company wont stand behind her policy. state it is in the policy(contract which has never been told to her or anyone else she knows that has this large ins company)) to put used parts on…like she has a bent frame..engine radiator are falling. cant be driven. has had 1 operation and still needs another. also told the other car that was hit was a lexus and this ins company paid out so much money to have it repaired that there is little money left to repair daughters suv. why can ins companies get away with this? she lives in a no fault state and has coverage and nothing is being done..and due to the ins company she has not had her suv in just about a year! THIS STINKS……ANY IDEAS?????? am interested in the E & O insurance claim. Anyone out there know of one in S Florida that would handle this for her???? H E L P
What is being missed here are statutory, regulatory and policy language issues. Years ago, the NAIC adopted Fair Claims Practice Statues that may also have given rise to further regulatory mandates. In Calif, any communication regarding a claim must be addressed immediatley not to exceed 15 days. Unbeknownst to most Brokers is the fact that all licensees are subject to these regs. Anyone involved with claims, including the Clerk at a Brokerage firm who submits claims to the Insurance Company, is required to be trained in the Regs.
Policy language too may set forth how, when and where claims are to be tendered. Courts have recently ruled a claim may be denied for failure to follow Policy requirements. One Court recently ruled a claim that had been submitted as part of the renewal submission to the Insurer’s Underwriter could be denied as not having been reported in accrdance with Policy provisions.
These isses were addressed by me recently in an IJ Academy of Insurance Webinar I gave 3 weeks ago on Specialty Lines claims from a Brokers perspective. HTe Webinar is available for download at their Webs site.
Frederick Fisher
ffisher@e-o.com