You may have followed all best practices of the industry in placing business for your clients in markets approved by your agency's selection protocol in order to protect the agency from potential claims and the client from loss. You followed up by monitoring the ratings and activities of the carriers involved according to agency guidelines. In short, you've done everything right. But what do you do when one of those carriers suffers a rating downgrade? The following tips may help you to provide further service to your clients while minimizing potential liability exposure to your agency:
1. Immediately notify clients of the downgrade and answer any questions they may have to the best of your ability.
2. Continue to keep your clients apprised of developments - use carrier approved notices/forms when available.
3. If a potential solvency issue exists make your clients aware of available guarantee fund protection.
4. Discuss with your clients their options including implications of a coverage move either at mid-term or expiration and potential impacts on premium involved. Allow the client to make client to make the decision as to which options to exercise and confirm in writing.
5. Be consistent - treat all clients in the same manner and document all client communications and agency actions taken in writing.
6. Consult with legal counsel regarding agency actions and content of client communications.
7. Maintain a positive relationship with the carrier. Avoid negative references and review your contract with the carrier to determine any duties or restrictions you may be subject to in regard to the downgrade.
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.