Do you write credit life policies at your bank? Just like any insurance agent or broker who obtains coverage for a client, you are obligated to exercise a reasonable, prudent and competent professional service.
The legal liability of the insurance agent as a professional is a well-established fact, and examples of situations in which agents have been held liable for errors, or for failure to act, are numerous. In general, an agent may be held liable to his or her clients, to the companies represented and, in some cases, to third parties.
Data from the claim files of insurers that write insurance agents’ errors and omissions coverage indicate the types of errors that are likely to give rise to E&O losses in an agency. There are numerous types of errors for which agents have been liable, but there are several common errors that agents should be aware.
The most common errors from agents stem from inadequate coverage, negligent misrepresentation, cancellation errors, description errors, renewal errors, delays in processing, failure to notify the client of a rejected application, policy change mistakes, reporting errors and agent responsibility for insurer solvency.
Find out about the agent’s liability for errors and omissions and much more at the next IBA Credit Life & Disability Workshop. The workshop helps to prepare consumer credit personnel for the State of Iowa Credit Insurance License, reviewing the rules and regulations in the sale of Credit Life products. IBA will present the one-day session on April 2 at the Courtyard by Marriott in Ankeny. Click here for more info.