You want E&O insurance but you're concerned about the cost. Can your insurance agency afford it? How much coverage do you need? Is E&O insurance really worthwhile?
Whether you're just starting out or your agency is on a tight budget, sometimes it can be difficult to spend money on services that seem like an extra expense. However, E&O insurance is very worthwhile to your business, so it's better to determine strategies to make it affordable than to forgo it entirely. Working with American Agents Alliance to discuss your options can help you make E&O insurance affordable for your insurance agency.
Why Do You Need E&O Insurance?
Some agencies feel like it would be better to avoid E&O insurance altogether. It seems like an extra expense that they can't afford. However, if you need to use your E&O insurance, you will be very grateful that you made the choice to get it.
While insurance often covers disasters such as fires or theft, errors and omissions insurance is your coverage for human-created disasters. You can't guarantee that your employees will be perfect all of the time, even if you wish you could. For example, if your employee forgets to add a specific type of insurance to your client's policy and that client suffers a loss and is not covered, they could state that your employees were negligent.
If an employee fails to communicate that a specific type of disaster such as an overland flood is not covered and your client thinks that it is, that person could take you to court. Even if you are not responsible for this loss, and even if your employees did not actually make a mistake, lawsuits like these can lead to many different expenses for your insurance agency, including payouts to clients. Small insurance agencies can become bankrupt due to problems such as this.
Insurance Discounts and Lower Rates
When you're looking for E&O insurance, know that it's not one size fits all. American Agents Alliance will consider how large your agency is compared to others in your field. Since E&O insurance is based on employee errors and omissions, the more people you have working with your clients, the more likely it is that you'll have difficult interactions with a client. Have a dialogue about the amount of insurance that's right for the size of your business.
If you're looking for other discounts, American Agents Alliance E&O insurance offers lower rates for first-time agents and includes discounts on extras and extensions such as cyber liability that other insurers may not include.
Your strong business track record will stand you in good stead when you're looking for E&O insurance. For example, American Agents Alliance offers a discount for staff with CIC designations and a waiver of some or all of the deductible after a certain number of years with an excellent track record.
Get Creative About Payments
If you're concerned about the affordability of E&O insurance, ask about splitting payments into multiple payments rather than forgoing insurance and placing your agency at risk. A payment plan makes it less difficult to manage all of your payment at once. Monthly payments allow you to make E&O insurance into an afforable monthly cost that allows you to protect your business from lawsuits.
Are you ready to get E&O insurance? Find discounted rates at American Agents Alliance. Talk with us about the ways that we can make your insurance more affordable. At American Agents Alliance, we're here to help you protect your business so that you can grow and thrive. Our affordable, discounted E&O insurance options are just one of the many discounts and membership benefits available to your insurance agency.