How preferred is preferred and are you willing to pay the E&O deductible for preferred client treatment?
| I did an agency workflow audit recently where I found piles and piles of insured copies of policies. They had delivery form letters attached and everything, but were just sitting there. When I asked the person who occupied that workspace why they were there, the response was “We only meet with that client once a year and they have asked us to keep their copies.” I just about died! Yes, I used to have several clients who moved so fast that they wanted me to keep all their stuff and just tell them what they needed to know when they needed to know it. For about 30 seconds that’s very flattering, but not for long. Yes, it’s outstanding that you have that level of rapport with your clients that they trust and depend on you to that degree, but do you realize what you’re biting off there? Those policy and endorsement delivery form letters are carefully written to define and undergird the responsibility the client has for playing an important role in their own risk management game. They client has to have the opportunity to actually read the dec-pages and check to make sure that what they think they have or they aren’t engaged as a member of their own risk management team and you’re taking on a HUGE E&O exposure.
When I probed with this client a bit further I found that this preferred client actually does have a business manager who handles all their affairs, which is where those piles and piles of insured copies and delivery form letters HAVE to be sent. Whether the actual insured is the one who gets the policy documentation and your carefully written CYA cover letters or not, you’ve got to get the monkey off your back and onto the client’s or their representative or you’re on the hook for a big E&O deductible, an increased rate and some bad PR for sure. |
