Agents selling life insurance coverage must always focus on risk management and pay attention to details to avoid simple errors which could have catastrophic results. One of the most common errors involves client communication, or the lack thereof. Unrealistic and unrealized client expectations are contributing factors in the majority of professional liability claims in any discipline, and particularly so in those involving insurance agents and brokers. Unrealistic expectations are most often caused by simple communication failures between the agent and his client. Those failures need not happen, and can be avoided by consistently employing a few basic strategies.
Never overestimate the client's knowledge of the services you intend to provide, regardless of the client's level of sophistication. It is your responsibility from the outset of the client relationship to clearly explain exactly what services you will perform and - equally important - those you won't. Carefully explain all coverages to your clients as well as any exclusions to those coverages. Never indicate to a client that you will place a policy until you have confirmed that it can be placed - if you don't know, say so. In advising clients always remain within your own area of expertise - do not attempt to render legal, accounting or any other type of advice. Make sure that communication is two way - have your client clearly explain has or her desires, needs and expectations Never volunteer information regarding your errors and omissions coverage. Clear communication can help ensure that you clients have the information and expectations they need to understand your responsibilities and liabilities regarding your scope of services.
Even when verbal communication is frequent, memory failure and misunderstandings often can result in disputes and litigation. For most of us, memory does not improve with the passage of time, and memory lapse tends to be aggravated when large sums of money may be at stake. Few of us remember all the details of telephone calls, group teleconferences, or face to face conversations shortly after they take place. Accordingly, agents should confirm verbal communications in writing, especially if they involve an agreement or commitment, notification, or a request for action or follow-up. Remember that voicemails pose a great risk for miscommunication and should be followed up in writing as to any points of significance (i.e. agreements, notification, request for action), correction or clarification.
Agents should also be aware that e-mail in the context of client communication is never actually casual of informal. From a legal standpoint e-mails are given the same standing as any other formal written document, are never totally deleted, and always form a key component of the client record for litigation purposes. For these reasons every agency should have a formal, mandatory e-mail communication policy in place requiring appropriate content, transmittal to all interested parties, and filing of hard copies of e-mails in client files. Use the "return receipt' e-mail function to confirm that your message has been received and opened. Follow up promptly if it appears that your message has been ignored, misdirected or lost. Texts to clients should be only used for the limited purpose of scheduling and requests for communication, and never for the purpose of transmitting substantive content.
Clear communication is a vital key to a successful and profitable client relationship void of disputes and claims. Effective communication should be a core competency of any agency that strives to understand and meet the needs of its clients. With expectations properly communicated, documented and verified any issues can be addressed quickly, calmly and effectively with minimal negative impact on time, costs and relationships.
All information provided in this blog is for informational purposes only. The sources used are presumed accurate. CalSurance Associates, Brown & Brown Program Insurance Services, Inc. and Brown & Brown, Inc. will not be liable for any errors, omissions, losses, injuries or damages arising from its display or use and will not assume responsibility for any misguided information. No guarantees are implied.