After my father’s funeral, I found myself sorting through his insurance papers, searching and searching for the umbrella policy I just knew he and my mother would have. It was nowhere to be found.
What I did find was the name of my father’s direct writer’s local agent. When I contacted her, she said there was no umbrella. When I asked why, she was very clear: “He never asked for one.”
Fortunately for her, in my father’s state, that was an acceptable answer—like most states, it required only an “order taker duty” or “duty to provide as requested.” Equally fortunately for her, it never became necessary for us to discover whether she had expanded that duty by advertising or otherwise offering to go beyond it with coverage advice, exposure analysis, asset protection and/or an ideal package of coverages to suit my father’s needs. Any materials that indicated the agency guaranteed a “special relationship” with its clients would have worked to prove this claim if we made it.
Unfortunately for many agencies, based on recent errors & omissions claims history, plaintiff attorneys are often successful in making those claims for their clients.
Just about every agency understands it needs a strong web presence. But while most marketing and E&O seminars alike provide valuable recommendations regarding your website, social media accounts and mobile apps, many conflict when it comes to site and app content.
An agency that waits for coverage requests will miss important revenue opportunities and fail to stay competitive with other agencies that offer more analytical, recommendation-based insurance services. Most insurance professionals have a desire to guide and educate, not just follow instructions, especially if those instructions would leave important exposures uninsured.
For that reason, marketing gurus may tell you to use words like “creating client relationships,” “differentiation,” “ hyper-value,” “going the extra mile,” “full coverage,” “proactive account rounding,” “exposure analysis” and “value-added.”
E&O seminar leaders, meanwhile, urge caution about over-promising, creating that “special relationship,” extending the “duty to provide” to coverage recommendations and using terms like “full coverage.” So how can you make sure your web presence is both E&O-safe and competitive?
Language to Avoid
A simple change in wording from “we will” to “we will endeavor to” is a good place to start. Avoiding comparative or superlative language like “best” is another. Here are some more well-intentioned but dangerous examples of web statements which could turn a case against an agency, along with safer wording that still gets the message across to the site or app user:
| Sample Original Wording | Suggested Rewording |
| “Full coverage” | “Coverage that matches your described needs” |
| “We ensure you have the right insurance plan to protect your family or your business.” | “Our professional staff can help you select the right coverage for your family or business,” or “We ensure the carriers we represent are financially sound.” |
| “Our financial services department can provide you with a safe retirement.” | “Our financial services professionals can help you choose among retirement planning options.” |
| “Providing the BEST solution for your particular situation.” | “We listen to what you need and provide strong coverage programs to match those needs.” |
| “Complete this form to request a certificate of insurance and include any additional insured person on your policy.” | “Please complete this form to request a certificate of insurance. You can also request a person or entity to be an additional insured.” |
| “Our goal is that every claim will be paid to your satisfaction.” | “Our goal is that you feel respected and well-informed in settling any claim that happens under the coverage you buy through us.” |
Your agency’s web presence may not use the exact wording above, but this may be a good time to go through it with a “jeweler’s eye” to see if modified wording is in order. You also may want to consult one of the site auditors listed on the Big “I” E&O Happens website.
Promises vs. Reality
A website or app is not just a marketing tool—it’s a representation to the world of what your agency is. Even safe wording and reasonable descriptions of your business model can be used against you in a court of law or mediation if the picture you paint on your site does not match the reality of your operation. What you reasonably say your agency does will be tested if a plaintiff alleges the agency’s work did not match that description.
For example, many agencies assure clients and prospects that they review each account annually. But often, those agencies process automatic renewals as they come in from carriers, with little or no pre- or post-renewal or mid-term coverage review. It is not unusual for an agency to move a commercial book of business to a new carrier and discover it does not even have a record of what the client’s business does.
Here are some other examples of potential dissonance between a web description of agency services and the reality:
| What You Claim | The Reality at Many Agencies |
| “We represent many carriers and can help you decide which one is best for you.” | Few if any of the staff, including producers, are able to point out meaningful differences between carriers’ forms in the same line of coverage. The agency has no coverage spreadsheets to help differentiate between available coverage options. |
| “We protect your assets and can assist you in planning for your retirement needs.” | The agency has, at best, sparse documentation that they’ve offered an umbrella to every client. |
| “Anyone helping you with your insurance is a licensed agent.” | Not every service rep is licensed; one or more service reps have failed the licensing test. |
| “We help you understand what coverage you need in a confusing insurance world.” | At most, the agency sends out an annual exposure update questionnaire, but does not offer proactive coverage suggestions to make the account better. Some clients have not had documented contact with the agency in years. |
| “We are an all-lines agency that can help you with any of your insurance-related questions and needs.” | All agency licenses are property-casualty, or the staff with life-health licenses have little experience with those lines of insurance. A very small minority of current accounts have any coverage that doesn’t fall into the p-c category. |
| “We will partner with you to review your work contracts and make sure your coverage backs up those agreements.” | Staff members are not legal experts or versed in contract law; often, the contract has been signed before the agency even sees it. |
Website Essentials
Like all E&O carriers, Swiss Re Corporate Solutions has seen plaintiff attorneys use a defendant agency’s web-based statements as evidence of negligence in not fulfilling its promise or duty to a client. Swiss Re’s Corporate Solutions Division offers the following best practices recommendations that are easy to incorporate into an existing site or app or when developing a new one:
- Clearly list the states in which your agency is licensed to offer insurance.
- If you give the client or prospect the opportunity to complete information for a quote or coverage analysis, explicitly state that misstatements or omitted information can and probably will change pricing and availability.
- Include a privacy statement and be very clear that you will not share any information a client or prospect provides with other parties without their explicit permission. Include a mechanism for the applicant to provide that permission. Visit iiaba.net/eohappens for sample language, or consult with your agency’s attorney.
- Encrypt all information that could jeopardize a user’s privacy and security, including, but not limited to, full name or mother’s maiden name; social security, driver’s license and car registration numbers; health information; and any free-form areas where the client or prospect could enter confidential information.
- Be crystal clear that applying for insurance does not automatically lead to being insured. Specify exactly what the applicant will receive to verify that coverage is in force. Repeat on every page, perhaps in a footer.
- Obtain, in writing or via an electronic signature, permission from any individual or business if you use a testimonial or quote from that entity.
- Avoid superlative and comparative words such as “the best,” “better than other providers,” “all risk” or “full coverage.” Instead, promote your professionalism, experience, specialization and product lines based on their merits.
- Set up a suspense system to ensure that site and app information is current. Staff changes, carrier deletions and additions, product line updates, relevant law revisions and changes in agency hours or location can get lost in the shuffle.
- Provide your agency’s credit and collection policy on any quote or coverage request page. For example, if the prospect’s old/incumbent agency reminds them to pay their direct bills and your agency does not, the potential new client has no way of knowing that they should not wait for your reminder call unless you tell them that. If their old/incumbent agency paid their agency-billed premium for them when their budget was tight and you do not advance premiums, the client deserves to be so informed. This will not only make the agency safer from E&O loss, but will begin client service off on the right foot.
Today, most clients want and expect your agency to be accessible electronically. In a competitive industry, you must differentiate your agency in order to retain current clients and attract new ones. Incorporating all web information mindfully and committing to keeping that information updated can lead to growth, retention and a strong community reputation—while helping you steer clear of E&O entanglements.
Virginia M. Bates is an approved auditor and seminar leader for the Swiss Re Corporate Solutions/Big “I” Professional Liability program, as well as an educator and consultant on many other insurance subjects for state associations, agencies, vendors, carriers and other organizations.
