Beware the Hidden E&O Risks of Remote Work

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By Laura Gookin | November 21, 2022

Independent insurance agencies with a blended remote and in-person work environment are discovering errors and omissions (E&O) issues that were rarely seen when everyone was in the office. Whether it’s employees working longer hours than intended from the comfort of home or fewer checks and balances because there is less face-to-face interaction, the latest trends have created new risks since pre-COVID 2020. At the same time, the market hardening that followed the pandemic is challenging agencies, prompting leaders to adjust their approach to E&O risk management.

Agency Operations

Once upon a time agency staff members could gather around the water cooler to discuss the issues of the day. Agency leaders could be reasonably confident that staffers were up to speed and understood current industry trends. Now it can be more difficult to get all of the agency’s players together to cover timely topics in a half-hour, and it might not be as apparent when someone is not on the same page — particularly if they are calling in from home, off camera.

Agency employees who are processing binders, policies and certificates of insurance from home may not be able to quickly turn to a supervisor or co-worker with a question. If the remote worker doesn’t get a timely response to a phone call, email or IM, they might not get the process right. Delays in getting answers also can lead to increased processing times and risks of errors.

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How Do Agents Advise Clients Who Become Consultants?

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As more professionals are opting to provide consulting services, the accompanying insurance exposure may not be top of mind.

By Tom Rea | August 22, 2022

Given the ripples of the coronavirus pandemic over the past two years, more professionals may be hanging out their shingles and opting to provide consulting services. In making such a career change, however, the accompanying insurance exposure may not be top of mind.

After the Great Recession of 2008, the real estate market was drying up, leading some agents to try property management, home inspection and appraisal work. Unfortunately, some did not have the requisite expertise and, consequently, professional liability issues arose.

Any consultant needs to realize that as an independent contractor they no longer have an employer as a buffer between themselves and a client, and therefore need to make sure they are careful not to overstate or misrepresent their expertise.

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How to help realtor clients avoid liability risks

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Rising interest rates, high home prices, a tight labor market and a possible recession all create performance pressure for realtors.

By Paul Dillon and Donna Genco | July 11, 2022

Independent insurance agents have an opportunity to grow their book in real estate — by providing the highest-quality real estate liability risk-management to carriers and by helping realty clients avoid potentially costly exposures.

Rising interest rates, high home prices, a tight labor market, and a possible recession can all put pressure on realtors to perform fast and bend the rules. Some may even be tempted to take on the roles of other professionals to provide a quick answer or expedite a transaction.

Insurance agents who place real estate professional liability coverage need to be on top of the situation for their clients’ sake and for their own relationships with carrier partners.

Insurance agents who keep realtor “mission creep” top of mind will maximize their value to both realtor clients and underwriters.

Are there adequate guardrails?

Real estate agents sometimes find themselves delving into legal, financial and technical areas related to the sale of a property. It may be that they are trying to get a deal done expeditiously. Or, it may be they do not have easy access to a group of independent experts. Or the client may refuse to follow the realtor’s recommendation that an expert be engaged. When a realtor takes on the role of other professional advisors to a transaction, they increase their professional liability exposure.

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