Documenting Conversations Offers You Protection

Documenting Conversations Offers You Protection

To some degree, the Internet has made it easy to maintain a “paper trail” when it comes to client communications; after all, in an email, everything is in writing so the chance of errors, mistakes and misunderstandings is minimized.  However, that advantage can have a flip side: When people become used to the “built-in” benefits of email, the habit of documenting telephone or in-person discussions can grow lax. As a result, many agents may become unused to writing down every conversation they have with a client, either as the conversation is happening or as soon as it’s concluded.

Here’s a “real life” example that demonstrates the critical role documentation can play when communicating with a client: A homeowner called his agent and asked to have his coverage limit reduced to save on costs.  The agent agreed to make the change, and even took the next critical step: After lowering the coverage limit, he prepared to put a confirmation of the change in writing so he could send the confirmation to the homeowner.  But, before he began writing, he received a phone call that required his immediate attention.  After addressing that issue, the policy change confirmation had completely slipped his mind, and he neglected to confirm the change with the homeowner. As luck would have it, shortly afterward, a fire destroyed the client’s home. 

Because there was no written confirmation of the homeowner’s request to lower coverage, he alleged the agent failed to provide adequate coverage. The claim was settled in favor of the homeowner, who received compensation totaling $80,000. The take-home message here is clear: Always document all conversations you have with your clients and follow up with your clients in writing.  Having a written record of your conversations can provide powerful proof if a claim is filed against you. Of course, errors and omissions happen, no matter how careful you think you’ve been in documenting a client’s requests, or in writing a policy that provides the correct type and amount of protection. 

As an insurance agent, having E&O insurance coverage is the best way to make sure you’re protected in the event of an E&O claim from an unhappy client.  At the American Agents Alliance, we provide P&C insurance agents the E&O insurance they need to stay protected. Learn about all the benefits that come with being a member of American Agents Alliance.

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