E&O Insurance: Don't be a know-it-all!

When I used to be a broker, I first cut my chops on D&O Insurance for publicly traded companies. When I left the niche focus of D&O Insurance, I had a short stint as a Sales Producer. With this role, I worked on a bunch of companies that had Errors&Omissions/E&O/MPL/Professional Liability policies.

I was really fascinated by E&O because it's so intertwined with a company's services.

The "Know-It-All"

The first thing that I realized was that some Brokers and Underwriters read an application, browse a company's website and immediately believe they know EVERYTHING about their client's services (a "know-it-all"). Some clients believe that just because they disclosed something on an application, that ALL their services are automatically covered (some brokers/underwriters may think this too). Yikes...........

One beginners guide approach to use for companies and brokers to spot-check the coverage at a high level:

Your Professional Liability policy is a box.

1. Your services either 1) fit the box 2) don't fit the box or 3) are in the gray.

2. First create your box....

• Write down or type out the definition of professional services (or equivalent)
• Write down or type out all your exclusions (the limitations)

3. Do your typical due diligence on a client's services (application, website, linkedIn, contracts, trademark website), highlight anything that you think might be outside of the box.

Critical next step:

4. Sit down with the client and share your box (professional services and limitations/exclusions ) - chat with them about their services and see if any services fall outside of the box.

5. The former sales person in me - used to say "Most brokers think that they know everything about your service model from 20 minutes of research, but in reality the person that knows the most about your services is you" (75% chance, the client nods and agrees with this)

6. If you're a company buying coverage digitally, ask for a copy of the policy and review the definition of professional services and your exclusions.

Note, there are so many more critical aspects to the policy - but this gives you a quick high-level picture of potential gaps.

So... final remark... just try not to be a "know-it-all" :)

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NOTE:?

• This blog/article?does not intend to provide legal advice or create an attorney-client relationship. You should consult your attorney in connection with matters affecting your own legal interests.??
• Opinions?expressed?are?solely?my?own and?do not?express the?views?or?opinions of my employer.
• I am not a broker and I don't know your specific insurance coverage. Please read the terms of your insurance policy or contact your broker for specifics.
• This is a casual post, there will be occasional typos and grammatical errors.?