Agency Management and Operations
The threshold issue in any Agency battle with Errors and Omissions litigation is how the Agency does its business. The degree to which an Agency is organized, the emphasis it places on the continuing education of Agency personnel, the quality of its advice and communications to its customers and the detail contained in its file documentation all become discoverable evidence which can help or hurt its case.
Mr. Sapourn spent 23 years as an agency principal in one of the largest privately-held insurance agencies in the Washington, DC metropolitan area. Prior to becoming CEO in 1987, he ran the commercial lines department for 8 years. He also served as a director on the board of one of the two largest trade associations serving the independent insurance agent community. And he continues his education through annual updates to maintain his Certified Insurance Counselor (CIC) and Certified Risk Manager (CRM) designations. Mr. Sapourn knows how quality agents conduct their business:
They tend to advance their insurance knowledge by pursuing educational curriculum like CPCU, CIC, CRM and CISR. These curriculum focus on improving Agents’ awareness of their professional duties, and they suggest strategies to help Agents become more professional;
They communicate honestly with their companies and their clients. Accurate representations to underwriters defeat any subsequent denial of a claim for misrepresentation that might be actionable against the Agent. And they disclose both the advantages and limitations of their proposals, in writing, to their clients and prospects, thus avoiding any claim that the customer was given the wrong impression;
They know their product and their companies. Knowing your product means being familiar with policy language, including the insuring agreement, the extensions and exclusions. Knowing your companies means staying current on their financial condition and knowing their guidelines for underwriting and binding coverage;
They maintain organized files;
They document written communications to the client and maintain a phone log which provides a summary of topics discussed and decisions made;
They have a system for periodically reviewing a client’s situation. Updating protection and the advice given insulates an Agent from any suggestion of neglect.