Key Takeaways
- Failure to procure coverage is the most common and most preventable E&O claim type.
- Documentation is the single most important defense: signed declination forms, binding confirmations, and timestamped AMS records.
- E&O claims must be reported to the carrier within 24-48 hours; never admit liability or alter records.
- E&O prevention investment ($3,000-$8,000 annually) is a fraction of a single claim’s cost ($20,000-$50,000 average).
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Test Your Knowledge
1.What documentation practice most effectively prevents E&O claims?
2.What should an agent do immediately upon receiving an E&O claim or potential claim notice?
3.What is the most common root cause of E&O claims?