The following article was adapted from Mr. Pearsall's presentation at the AMS Users' Group's 29th National Conference, which was held in April in Nashville, Tenn.)
IN RECENT years, advances in automation and technology have improved agencies' efficiency and greatly increased their capabilities. The advances also have affected agents' E&O exposures. When implemented properly, automation can significantly decrease agents' odds of being sued. But when automation is not handled well, it can be your worst E&O nightmare. In this article, we'll take a look at how automation can help an agency avoid trouble–or lead it right into it.
Before getting into automation and E&O exposures, let's take a brief look at the E&O marketplace. In the mid-1990s, there were probably some 30 carriers writing agents E&O. Now there are maybe a dozen. Insurance agents E&O is not for the faint of heart. Million-dollar claims are somewhat common. We recently had one for $3.6 million.
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