Insurance Agencies: Your Common Legal Questions

Insurance Agencies: Your Common Legal Questions

You have a FAQ for your customers, but what about your frequently asked questions? As an insurance agency, it can be difficult to know where to turn with your questions. Thankfully, you can find support for some of the most common questions if you know where to look. Here are a few of the common questions that insurance agencies struggle with and guidance as to where to find the answers. 

What Privacy Responsibilities Do I Have? 

As people worry more and more about their data security and online privacy, new privacy laws come into effect. For example, according to the New York Times, in 2018 Europe introduced the General Data Protection Regulation or GDPR: "The changes aim to give internet users more control over what’s collected and shared about them, and they punish companies that don’t comply." 

You're an insurance expert, not a privacy law expert. By talking with legal advisors through an insurance agent association or by attending information and education sessions on privacy law, you can come to understand the implications of changes in privacy law for your business. 

What Happens If There is a Data Breach? 

Every company needs to be concerned about their data, since hacking is rampant and can occur due to an employee who simply opens up an email. Your clients' personal information could be inadvertently compromised, and you might not even know until days, weeks, or months later.

As a business, you have a responsibility to examine your current data security processes, including staff training. According to the Financial Post, "A new Maru/Matchbook survey conducted on behalf of Moneris shows that more than two-thirds (67 percent) of small- and medium-sized businesses (SMBs) have yet to conduct a data security audit, and most (70 percent) have no data security protocols in place."

 Failing to protect your business can be a problem for your clients and for you. Connect with your insurance agency association to learn more about educational opportunities that will allow you to understand the potential for data breaches and hacking and help you create processes to protect your clients' data, including staff training. Work with professionals in the data security field to implement the systems that are right for your company.

How Do I Protect My Agency? 

Another common question that agencies have is the question of your company's future security, especially when it comes to clients who are unhappy with your business. While some clients will discuss, complain, and find a remedy through your business, others have legitimate complaints that could be based on an error or omission that you caused. 

For example, if you leave a client's credit card information visible to others who come into the office, that could cause a loss for that client. If you fail to provide enough information about an insurance product and the client assumes that she's covered when she's not, then this is an omission. Going to court can bankrupt small companies. It's best to work both on your procedures to make sure that errors and omissions happen rarely and to add E&O insurance to your business so that you're protected if a lawsuit does occur. 

As an insurance agent association, American Agents Alliance is dedicated to helping you find answers to key questions. We operate a legal hotline that provides our members with information so that they don't need to worry about where they'll find the answers. Are you curious about membership? Contact us today to learn more about our many membership benefits.

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