Could Sexual Harassment be a Professional Liability Issue?

The issue of sexual harassment is not typically associated with professional liability insurance coverage. However, as some cases have some to surface which intertwine sexual abuse and professionalism, the question has been raised; should coverage extend to these claims under specific circumstances? In the following case, Errors and Omissions Insurance Program was required to respond to the sexual harassment claims against this professional. As the Connecticut Supreme Court stated, “when a medically negligent procedure so inextricably intertwined and inseparable from the intentional conduct that serves as the basis for the separate claim of a sexual assault, we join with those jurisdictions that conclude that professional liability policies must, in such instances, extend coverage.” This was a case involving an endocrinologist in Connecticut by the name of Dr. George Reardon and his alleged sexual misconduct of his minor patients.  Reardon used the hospital and their finances to conduct this ongoing assault for decades. As Reardon used the hospital to conduct his indiscretions, the hospital was found liable for the $2.75 million payout that the jury awarded the victim. According to Lexis Nexis, the court does not allege that a person who happened to be a medical professional abused children on his days off, or even that he opportunistically abused his patients at the Hospital, but rather that he devised a long-term medical study to be carried out under the Hospital’s imprimatur and ostensibly under its professional supervision and that a principal purpose of that study was to find and abuse his victims. Therefore, in circumstances in which the conduct and the intention are so closely related, professional liability coverage will be required to supplement any claims made. While sexual harassment is a sensitive issue, your clients should be protected with the proper insurance to prevent these potential claims from devastating their business. In addition to bringing you the latest news from the insurance industry, PL Risk provides Resources for Agents and Brokers nationwide. We’ve recently implemented Hiscox Now, which allows agents their own access to Hiscox and instant quoting. To learn more about our operations, contact us today at (855) 403-5982.

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Should Client Dissatisfaction be Reported to your E&O Carrier?

As professionals, it is impossible to please every single client. Even with the best business practices and evident focus on client relationships, customer dissatisfaction is a reality of operating any type of business-justifiable or not. As some complaints can lead to severe consequences and lawsuits, a Professional Liability for Insurance Agents policy is required to protect their operations. When customer dissatisfaction becomes a lawsuit, the proper insurance coverage is needed. However, the limitations and types of claim coverage vary. Almost every professional liability insurance policy is a “claims made” policy, which typically provides coverage only for claims first made against the insured and reported to the carrier in writing during the policy period, says Property Casualty 360. Contrarily, “potential claims” coverage provides protection against errors in action that could result in a claim. If the employer fails to notify the insurance carrier promptly, the coverage is immediately void. In the event an unhappy client files a claim, the employer must immediately forward this to the carrier. However, “potential claims” are an entirely different component. Essentially, the issue lies in what the courts could deem “reasonably foreseen” acts by the employer which should have been avoided and prevented. The answer to this question is dependent on whether the court takes a “subjective” or an “objective” perspective in evaluating the claim. In other words, Property Casualty 360 asks if the court ascertains your awareness of a potential claim by determining whether you subjectively believed a claim was forthcoming. Or, did the court assess the act and deem it was objectively reasonable or not? Therefore, the language of the policy should be scrutinized to ensure the proper coverage exists. After all, a business consultant’s reputation is the basis of their business and a large part of how they gain new clients and retain existing ones, states Hiscox. In addition to bringing you the latest news from the insurance industry, PL Risk provides Resources for Agents and Brokers nationwide. We’ve recently implemented Hiscox Now, which allows agents their own access to Hiscox and instant quoting. To learn more about our operations, contact us today at (855) 403-5982.

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How to Sell Cyber Liability Insurance to Small Businesses

Unfortunately, it’s no surprise that cyber-attacks occur on a daily basis. Although large corporations tend to take the spotlight when a breach occurs, the fact is that small businesses are actually affected more frequently. Not only is private, identifiable information stolen, but the repercussions of the attack can be devastating to a small business. In order to protect your clients’ biggest investment-their business- it is imperative they have Privacy and Network Security Insurance in place. Here are a few tips on how to effectively sell this service to your clients. Review Vulnerability & Policies- Hiscox states that many small business owners are unaware of the high risk of data breaches as they believe hackers are more likely to attack a high-profile, high-revenue establishment. Conducting a risk assessment to see what data needs to remain collected and how to properly store it is the first step in determining what kind of coverage they need. Information such as credit card data can be stolen and they’d be liable for identity theft. Review current polices with your client to ensure cyber liability is not excluded. Cloud Systems do not Equal Protection- In the event of a data breach; your cloud vendor will not assume responsibility of the stolen information. Remind the client that it is up to the business to instill a protection policy. Show them Monetary Figures- According to NetDiligence, the average breach costs an estimated $733,000. The combination of legal fees, credit monitoring services, customer repayment, PR consultants, etc. adds up pretty quickly. Prompt the client that your cyber liability policy will cover all of these vendors for one low cost that will save them thousands in the long run. In the absence of insurance, one hack could bankrupt the small business just from trying to pay all of the fines. Compare Policies- Give a detailed overview of what each cyber policy offers. Have the client weigh their options while offering expert advice. Although there is no “standard” coverage policy, assist your client in finding the right policy for the right price, making sure no necessary measures are excluded. Educate your Client- As previously mentioned, there is not one specific definition of “cyber-attack,” That said, there are multiple facets that are covered by this insurance solution. Stealing or misusing personal information and denial of service is also included. Cyber liability risks are…
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Why Errors and Omissions Insurance is Essential for Escrow Companies

Why Errors and Omissions Insurance is Essential for Escrow Companies As a neutral, trusted third party, your escrow agent clients have a lot of responsibility to the clients they serve, especially since those people may never even end up meeting each other. In addition to fiduciary responsibilities, escrow agents must secure the property and examine documents to make sure that all the terms of the sale are met on each end in order to serve both the buyer and the seller in the transaction. So why do these escrow agents need Errors and Omissions (E&O) Insurance, also called Professional Liability Insurance? They face a number of exposures to E&O claims as well as malpractice claims. A few of these claim risks are: Breach of Contract. An escrow agent can be held liable for breach of contract if they have not followed the instructions outlined on the said contract, or if they fail to redeliver goods on the completion of conditions on the contract. Ultimately, if an escrow agent breaches duty to either party, or is even perceived to have done so, they can find themselves facing a breach of contract errors and omissions claim. Failure to collect all funds or funds released before all conditions are met.  An escrow agent has the duty to properly account for all escrow funds and ensure that the usage of those funds is exclusively for the purpose intended. Improper or inadequate documentation. Even if an escrow agent acts professionally and provides all documents in good faith, they may still be sued and easily be faced with thousands of dollars in defense costs if the documentation is not specific enough, or perceived to be incomplete. These are just a few of the exposures that your escrow agent clients face. Other risks include breach of fiduciary duty, failure to make appropriate payment, or funds wired to the wrong account. In order to protect against these potential claims, it’s essential that these individuals carry Errors and Omissions Insurance for Escrow Agents. PL Risk offers policies in this area as well as a number of other professions. Please contact us today for more information at (855) 403-5982.

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What Are the Costs of Going Without Professional Liability Insurance?

What Are the Costs of Going Without Professional Liability Insurance? Commonly known as Errors & Omissions, Professional Liability Insurance protects your professional advice-giving and service-providing clients from bearing the full costs of defending themselves against a negligence claim made by their customers, and damages awarded in such a civil lawsuit. Although you know how essential it is for these professionals to carry this type of insurance, your clients and potential clients are not always aware of how Professional Liability benefits them, or they may think they simply don’t need it. This gives you the opportunity to educate and inform them. It’s important for them to know what the costs of going without professional liability insurance are. Not only does professional liability protect against claims made by customers, it is also required in many states. In other states, it’s not required, but a professional can still face legal ramifications, fees, or job loss if they don’t inform their own clients that they don’t carry insurance. For example, June of 2013 after allegedly mishandling funds, an attorney licensed in Ohio had his license suspended for 24 months because he failed to notify a client he did not carry professional liability insurance. Professional Liability Insurance is for your client’s own protection. Without it, their business will have to cover the costs of a successful litigation, including attorney fees and the costs of defending themselves and their business in a lawsuit. This insurance of course does not make them less likely to be sued, however it helps them to be more prepared if a lawsuit is brought against them. PLRisk Advisors is a leading wholesale insurance brokerage covering the professional liability market. Our team of seasoned professionals has the depth and breadth of knowledge to help our agency partners secure the best quality coverage for their clients in various industries. Please contact us today for more information at (855) 403-5982.

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Why Professional Liability for Mortgage Bankers is Crucial

Why Professional Liability for Mortgage Bankers is Crucial As you likely know, it is essential for your mortgage banker clients to carry Professional Liability Insurance. This type of insurance covers their firm’s liability for Errors & Omissions made in providing professional services such as loan origination, loan underwriting, processing, marketing, closing, warehousing, and servicing. A couple examples of claims that have been covered in the past by this type of insurance include: Misrepresentation of Loan Terms– a borrower filed a lawsuit against an insured alleging that an employee of the insured promised to provide them with a loan that did not include a pre-payment penalty. However upon attempting to refinance, the borrower discovered that the loan did indeed include a pre-payment penalty and the borrower suffered a financial loss in their transaction. Class Action Lawsuit for Excess Fees– This was served on an insured alleging that they illegally and routinely required payment of excess fees and yield spread premiums. The lawsuit asserted causes of action for breach of contract, violation of the Consumer Protection Act, and unjust enrichment. In both of the claims mentioned above, the insureds faced high defense fees and legal fees that they may not have been able to financially cover if it weren’t for professional liability insurance. In addition to protecting your clients in these types of situations, professional liability insurance covers claims involving violations of lending regulations such as the Truth in Lending Act, Real Estate Settlement Procedures Act, the Equal Credit Opportunity Act, and the Fair Housing Act. It’s important for your clients to understand exactly what coverages Mortgage Bankers have if any of these types of claims are made. PLRisk Advisors provides professional liability insurance products for a number of professions. We are a leading wholesale insurance brokerage covering the professional liability market, and our team of seasoned professionals has the depth and breadth of knowledge needs to help our agency partners secure the best quality coverage for their clients. Please contact us for more information about our Professional Liability for Mortgage Bankers insurance programs at (855) 403-5982. 

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The Importance of Professional Liability Insurance for Architects

The Importance of Professional Liability Insurance for Architects It’s been almost a year since Superstorm Sandy hit the Northeast, and for some coastal communities, the rebuilding has only just begun. There has been a lot of talk about elevating roadways to prevent some of the damage that was done last year. With that, many homes are being lifted as well. Of course, with these new building designs come risks for the architects that take the projects on. These architects have to face new federal regulations in regards to flood maps as well as new local zoning regulations that aren’t necessarily in line with the federal rules. This is just one example of the potential legal risks that could be faced by your architect clients. Architects are held responsible for their designs and how well those designs hold up structurally. It’s vital that these designers understand the importance of Architects Professional Liability Insurance, since the firm they work for is only liable to a certain degree until the architect him or herself is held responsible. A lawsuit could occur over something as minor as the ceilings not being designed to standard or as serious as the architect omitting a structural component such as rebar. In the case that an architect is faced with a lawsuit, professional liability insurance will help with the cost of the litigation. It’s simply not a good idea to be without this type of insurance when playing such a pivotal role designing people’s homes and/or commercial buildings. The important thing for your clients to ask themselves is, “Can I afford to be without professional liability insurance?” PLRisk Advisors is a leading wholesale insurance brokerage covering the professional liability market. Our team of seasoned professionals has the depth of knowledge to help our agency partners secure the best quality of coverage for their clients. We provide Professional Liability, or E&O, insurance products for a number of professionals. Please contact us today for more information at (855) 403-5982.

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Professional Liability Insurance for Insurance Agents

Professional Liability Insurance for Insurance Agents Almost 1 in 7 insurance agents will be involved in an Errors and Omissions claim at least once during their career. Insurance agents are one of the most commonly sued professionals, making the need for professional liability insurance coverage necessary. When offering services to any client, there’s always the potential to make a mistake that results in a lawsuit being brought against you. Here are just a few examples of professional liability claims that insurance may face: Not maintaining detailed client records Omitting important client information Misrepresenting or falsely advertising information to clients Liability issues often arise from what started as a simple mistake, such as a misunderstanding with the client that leads to the unintentional omission of information. This often results in an accusation of negligence and a lawsuit with significantly costly damages. Misrepresentation is another common claim. These types of claims arise when an insurance agent misrepresents information to their client, such as selling them unnecessary coverage. A lawsuit could also be brought against insurance agents include that offer comprehensive coverage without informing the client of coverage gaps, or failing to provide proper documentation of their policy. In order to protect against these different situations, it’s crucial to invest in professional liability insurance coverage. PLRisk Advisors is a leading wholesale insurance brokerage covering insurance agents and brokers nationwide.  Our team of seasoned professionals has the depth and breadth of knowledge to help our agency partners secure the best quality coverage for themselves and their clients. Please contact us today at (855) 403-5982.

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Why Businesses Need Professional Liability Insurance

Why Businesses Need Professional Liability Insurance Professional Liability Insurance, sometimes more commonly known as Errors and Omissions or E&O, is liability insurance that helps protect individuals and companies that provide professional advice or services. In the event of a negligence claim made by a client, this type of insurance will protect your business client from suffering the full costs of defending their entity. One of the most common forms of professional liability insurance that most individuals are familiar with is malpractice insurance for healthcare providers. However, there are many businesses that need this type of insurance, including: Real Estate Agents. In a previous post we discussed Professional Liability for Residential Real Estate Agents and the different scenarios in which a residential real estate agent could find themselves facing a legal claim, such as violating the Fair Housing act or providing false advertising. Customers today have higher expectations, increasing the chances of a lawsuit. Property Managers. The most common reason for litigation against property managers is an error or omission in the written terms of the contract they hold with their tenants. Contracts must include a detailed descriptions of services and fees, responsibilities of the property owner, contract duration, and more. IT Consultant. Let’s say that your computer consultant client has been contracted to back up their customer’s business records, and the external hard drive they use fails, causing them to lose all of that data. Their customer could then make a claim against them for using improper backup procedures which caused their failure to deliver the services offered. These are just a few of the businesses that will benefit from professional liability insurance in the event of litigation. The best way for your business clients to guard themselves financially from claims is by investing in this type of insurance. However, by helping them familiarize themselves with this potential claims, you could be helping them limit their risk exposure. PLRisk Advisors is a leading wholesale insurance brokerage covering the professional liability market. Our team of seasoned professionals has the depth of knowledge to help our agency partners secure the best quality of coverage for their clients. We provide Professional Liability insurance products for a number of professionals. For more information, contact us at (855) 403-5982. 

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Professional Liability for Residential Real Estate Agents Part II

Professional Liability for Residential Real Estate Agents Part II Errors & Omissions, or Professional Liability, claims against residential real estate agents and brokers are common. The lawsuit that real estate agents face the most is misrepresentation; however there are many other legal issues they might deal with. Investing in Professional Liability Insurance and familiarizing themselves with these potential complications is a good way for your clients to be prepared, should they face these complications. In Part I, we discussed a few of these problems and what your clients could do to stay informed. These are a few more common causes of lawsuits. Environmental liability: These lawsuits happen when a broker fails to recommend people with expertise to evaluate hazards such as asbestos, lead-based paint, and groundwater contamination. To limit this type of liability, your clients should know what the common environmental issues and hazards are in their area, and compile a list of local inspectors and resources to give to their customers. Real Estate Settlement Procedures Act (RESPA): This was designed to inform homebuyers about the costs of closing and to eliminate kickbacks to settlement service providers for referrals. RESPA violations can be avoided if your clients understand the law’s prohibitions and strict compliance if any referrals are made among affiliated service providers. Unauthorized practice of law: Your clients are not permitted to provide legal advice to their customers, according to the REALTORS Code of Ethics. They should know the parameters of what they may and may not do in their state, and urge clients to hire a lawyer if they have legal questions. Americans with Disabilities Act: In order to abide by the rules of the ADA, your clients need to make sure that their office, which is a public accommodation, is equipped with ramps, curb breaks, and other considerations to allow a disabled person to access the building. Legal pitfalls can be a costly disaster for real estate agents & brokers. Therefore, it’s important for these clients to be armed with appropriate Professional Liability coverage. PLRisk Advisors is a leading wholesale insurance brokerage covering the professional liability market. Our team of seasoned professionals has the depth of knowledge to help our agency partners secure the best quality of coverage for their clients. We provide Professional Liability, or E&O, insurance products for a number of professionals, including both commercial…
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