As an insurance agent, you understand the importance of risk mitigation better than anyone. That’s why you have insurance to protect your business against mistakes. While it’s comforting to know you have coverage if you need it, most insurance agents would prefer to avoid errors and omissions (E&O) claims.
Of course, when you make a mistake and have to file a claim with your E&O provider, you’ll have to pay your policy deductible and complete the mountain of paperwork involved. In reality, the true cost of E&O claims can go well beyond your time and the policy deductible.
First, you run the risk of losing customers who are upset that you made a mistake or failed to disclose something crucial about their policy. In the relationship business of insurance, those losses can quickly add up.
When a builders risk client suffers a loss and discovers that it wasn’t covered, that alone can leave them with a negative impression of both you and the provider. If the loss they suffered could have been covered through a policy endorsement or another type of policy, they’re not likely to want to work with you again in the future.
That frustration and disappointment from a client can then snowball into reputational harm. An unhappy client isn’t likely to recommend you to other potential clients who need builders risk or other coverages you offer, and might not be shy about sharing their negative experience online as well.
Thoroughly understanding the coverage options, features and limitations of available policies is the surest way to protect yourself against loss. Take the time to understand which coverages and exclusions are standard to a builders risk policy, and learn about optional policy endorsements. That way, you’ll be able to provide your clients with comprehensive coverage tailored to their needs.
To learn more about how a thorough understanding of builders risk insurance can lower your risk of E&O claims, download our free resource, Avoid Costly E&O Mistakes: Identifying Builders Risk Exposures.
This is intended as a general description of certain types of insurance and services available to qualified customers. Your policy is the contract that specifically and fully describes your coverage. The description of the policy provisions gives a broad overview of coverages and does not revise or amend the policy.