Author Archives: INF_WP_U53r

Reporting A Claim Under A Claims Made and Reported Policy

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Most professionals know to protect themselves and their clients with the purchase of a professional liability insurance policy, commonly referred to as an E&O policy.  What most professionals don’t know or don’t care to know, is when and how to properly report a claim or potential claim to their insurance carrier.

Initially, the most important issue when reporting a claim is the timing of the notice to the carrier.  All carriers have different reporting requirements but most state that the claim or potential claim must be reported to the carrier in the policy period YOU first become aware of the claim or potential claim.  Some carriers are even more restrictive and will use the term “immediately report” or “as soon as possible after first becoming aware of the claim.”  No matter the wording in the policy, the timing of the notice to the carrier is absolutely vital to the claim being covered under the policy.  A delay in reporting the claim or potential claim to the carrier can lead to a declination of coverage due to “late reporting.”  Late reporting is a term no insured wants to hear in a claim situation.  Do not fall into the trap of thinking it will just go away, or hold off on reporting for fear that your premium will increase.  Providing professional services for others unfortunately will give rise to a claim or potential claim.  These must be dealt with immediately.

All carriers have slightly different policy wording with regard to the timing of claim reporting.  The best way to reduce the possibility of a declination due to late reporting is to report the claim as soon as you first become aware of the claim or potential claim.  Regardless of “how much time” the policy provides, immediate reporting of the issue to the carrier will be viewed as favorable by the carrier and the claims personnel.  It may even provide a good night sleep for you!

Keeping Your Information Safe In the Digital Age – Part 1

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With the onslaught of data breaches that have been in the news lately (think Target or Sony), INF presents this multi-part blog series about keeping your data safe in the digital age.

Passwords

Do you pick a password and then use that for all of your accounts or do you choose short passwords that are easy to remember?  Is your password “Password” or the name of your pet?  Do you keep a word document or piece of paper with all of your passwords written down?  If so, your digital information could be in trouble.  More than 60% of people use the same password on multiple accounts.  In the digital world, this means that if I can break into one account, then I can have access to all of your accounts.  This is why when a data breach happens with one retailer, fraudulent activity among other retailers goes up as well due to usernames and passwords being the same.

Most people choose their passwords from a finite set of words, phrases and numbers (or some variant of this), which makes guessing your password a trivial task for most hackers.  They use a “Dictionary Attack” on an account, which takes commonly used words from the dictionary and puts them together with numbers and other words to create a password to try.  Bear in mind, this is not a human being doing this, so multiple attempts to guess your password can be made by the second and whole attacks can last less than one minute.  Additionally, software that does this is commercially available and thus, is very easy to implement.  Once a hacker has cracked one of your accounts, they immediately target others.  In doing this, they will touch as many accounts as they can before you are alerted that anything is wrong.

How To Choose a Strong Password

In order to combat this and become a smarter user, you must create a strong, non-trivial password for each account that you have.

Choosing a strong password becomes simple once you learn the following four rules:

  1. Choose a password that is 13+ characters long
  2. Choose a password that does not contain any words in the dictionary
  3. Choose a password that has an uppercase letter, a lowercase letter, a symbol, and a number
  4. Choose a password that does not use all obvious substitutions of symbols/numbers for letters (i.e. 5 for “S” or @ for “a”)

One recommended way to create a password is to think of a phrase from a book or song that you like and turn it into a password.  As an example, if you are a fan of “Hitchhiker’s Guide to the Galaxy” by Douglas Adams, you may turn the phrase “So long and thanks for all the fish!” into the password “S81ng&Tks4@!!f!$h!”.  Notice that none of the actual words were used and not all of the substitutions were obvious, such as “8” for ‘o’.  A simple trick to remember is – the longer the password, the stronger the password.

You may be asking, “How in the world am I going to remember all of these passwords?  I must have over 90+ accounts online, like the average American!”  There is no need to remember all of the passwords that you create.  In fact, if you can remember one very strong password, you can access all of your others by using a password management program such as KeePass, 1Password or Dashlane.

Part 2 of this series will cover setting up and using a password management program.

 

WHAT IS IN MY PROFESSIONAL LIABILITY INSURANCE POLICY?

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The other day I was speaking with an attorney who had an interest in our Professional Liability Insurance programs.  So to start the process, I asked him questions regarding his current coverage.  Keep in mind, they were not tough questions:  Who is his carrier? Who is his agent? What are his limits and deductible? When is his renewal date?  All of these questions solicited the same response, “I’m not really sure”.  As crazy as that may sound, his next answer really took me by surprise.  When asked if I could review his current policy, he had no idea where his policy was or how to get a copy.  He actually asked me if I could get him a copy of his policy!

I realize that professionals are very busy people and insurance (for some) is considered BORING, but you spend a lot of money for this coverage.  You should at least take the time to know some of the basic details (at the very least, where your policy is kept).  If you do nothing else, take the time to read your policy once a year.  It shouldn’t take that long to read it and will be time well spent.  Some things to pay attention to are the obvious: carrier name, policy period, limits of liability and deductible.  Be sure to take note of any retroactive dates that apply as well as the definition of claim, the definition of insured and any and all exclusions.  You may find out that things you thought were covered aren’t and vice versa.  Bottom line is take the time to read your policy.  Know what you are paying for.

And, remember, you can always ask your agent to explain things that you don’t understand.  

Value of Broker Services for Professional Liability Insurance

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As an insurance professional for more than 25 years, It never ceases to amaze me how commoditized the professional liability insurance marketplace has become.  The coverage is not that simple but yet many professionals purchase the policy on line directly from the carrier without the assistance of a broker.  No consideration is given to policy form, prior acts coverage, limits, deductible or the many ancillary coverages available.  No value is given to the broker services.  I don’t understand this as brokers provide valuable services: policy comparisons, concise explanations, proposal/carrier options and risk management services.

As an insurance agent and the owner of a small business, I understand and can relate to cost cutting measures and getting the best “deal” possible.  I have seen clients change carriers/programs/brokers for a  $50 savings of annual premium and little or no regard to the coverage or broker services lost!  Does that make sense to you?

I don’t believe that the purchase of insurance, especially one that protects a professional’s reputation can be all about the money.  Don’t get me wrong, the money issue is very important however neglecting the coverage issue and broker services can be devastating at claim time.