The chief executive of Willis Group Holdings is applauding New York State Superintendent of Insurance Eric Dinallo for instituting a rule requiring insurers to have contract certainty in place within a year.
Joe Plumeri, Willis chairman and CEO, said in a statement, "Willis has long held the belief that contract certainty is one of the basic principles of service and should be adopted across the industry. There is absolutely no excuse for policies to be delivered months after their inception, an all too commonplace practice in this business.
"Through the Willis Quality Index, which specifically measures contract certainty as one of its key metrics, we have taken active steps to work with insurance carriers to make sure our clients receive their policies in a timely manner," Mr. Plumeri continued.
"We're in the business of keeping promises, and the insurance industry as a whole can do no less. We believe that the industry should police itself, take a principled approach to doing business, and adopt these measures as soon as possible," said Mr. Plumeri.
The Willis CEO noted that contract certainty practices are already commonplace in the United Kingdom after the Financial Services Authority (FSA) urged the industry to adopt such measures in 2004.
Yesterday, Mr. Dinallo issued a bulletin to insurers, agents and brokers, advising them to take steps to provide contract certainty. He specifically asked them to develop and implement practices within the next 12 months to assure that policy documentation is delivered to policyholders within 30 days of the policy's inception.
Mr. Dinallo, in announcing his action, noted that in the case of the World Trade Center attack on 9/11, several insurers did not have contract certainty, resulting in six years of legal wrangling. The issues were not settled until New York state officials, including Mr. Dinallo, intervened and brokered an agreement.
Mr. Plumeri has been a longtime advocate of contract certainty since he joined Willis in 2000.
Prior to being named the state's superintendent of insurance, Mr. Dinallo was general counsel at Willis.
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