CAMICO, a nationwide CPA-directed program of insurance and risk management for the accounting profession, has broadened protection for potential professional liability insurance claims known to policyholders who continuously renew their CAMICO Mutual Insurance policies.
Known as “Continuity of Coverage for Potential Claims,” the broader protection includes coverage for claims arising from circumstances known to an insured after the first effective date of a CAMICO Mutual policy that is consecutively renewed through the effective date of the current policy. The new benefit in effect removes “late reporting” as a basis for coverage denial as long as the insured became aware of the potential claim after the inception of the first of consecutive policies.
“Many professional liability insurance policies require known potential claims to be reported during the same policy year in which the insured becomes aware of the potential claim,” said Gary M. Florian, CPCU, CAMICO vice president of underwriting and policy services. “If a potential claim is not reported until the second year of the policy or later, the insured may not have coverage for an eventual claim, due to late reporting.
“CAMICO’s new benefit is significant in that late reporting is no longer a cause for coverage denial with policyholders who continuously renew with CAMICO Mutual,” said Florian. “Claims that were denied solely because of late reporting will now be covered for those policyholders.”
The new benefit does not affect the incentives CAMICO has in place for early reporting of potential claims: a 50 percent deductible reduction (up to $50,000) for any potential claim reported before a claim is made in the same year that the firm becomes aware of the potential claim. CAMICO also provides tax penalty abatement and other legal services in regard to potential claims, including subpoena services, if needed. The legal expense is absorbed by CAMICO and does not impact policy limits.
About 75 percent of all potential claims reported to CAMICO are resolved before they become claims—a major reason the company offers incentives for early reporting. Early resolution also enables policyholders to avoid the stresses of a claim and to get back to business as usual.
The CAMICO program is sponsored by state CPA societies and associations in Arizona, California, Colorado, Greater Washington D.C., Indiana, Kansas, Mississippi, Missouri, Nevada, New Jersey, New York, South Carolina, Tennessee, Utah, Virginia and Washington. CAMICO provides professional liability insurance, employment practices liability insurance, business owners package, workers’ compensation, personal umbrella and other insurance products needed by CPA firms.
Was this article valuable?
Here are more articles you may enjoy.