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Are You Performing the "Mirror Test"?

If you don't closely compare coverages when switching accounts to a new carrier, your customer could face an uninsured loss -- and you could face an E&O claim.

By Curtis M. Pearsall | Updated on August 17, 2011

How many times over the last couple of years has your agency found it necessary to move a personal lines or commercial account to a new carrier? Due to the soft market, it has probably happened fairly frequently. In most of these situations, the premiums were probably lower, resulting in a happy customer and the retention of the account.

The next question is: How confident are you that the coverage with the new carrier was at least equal to the expiring policy—or if it wasn’t, was the customer aware of the fact and did he or she sign off on the differences? If you didn’t identify the differences and a loss occurs that would have been covered by Carrier A but was not covered by Carrier B, your customer will not be happy and may consider bringing an E&O claim against you and your agency.

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