NOTICE: This discussion is for Life & Health only agents. P&C agents need to keep this in mind before jumping in.
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Well, folks, this old dog has had to learn some new tricks. When I first got licensed about 4 years ago, I was given an application for E&O by my GA and told to sign it because I couldn't get carrier appointments without it. Not being an insurance agent but one month at that time, I trusted him and signed up. As a matter of fact, I renewed that contract each subsequent year, having only looked at the price of competing policies and staying put because mine was the lowest price I could find.
That has changed now. I tell my clients: Coverage first, then cost considerations. What good is it to have a cheap policy if it doesn't cover your needs. I need to take my own advice.
I just discovered that my E&O (BCS) does not provide for LTCi, which I want to sell, but does cover securities, which I do not sell. I never realized that other E&O carriers have a widely differing array of coverage options. Mine does not break down into optional choices for me... it is an all or none type. Take it or leave it. But most of all, I never realized that LTCi was not covered. I made a BIG assumption! (edit: Not true. See edit comment below)
I see that CalSurance (CNA) has a customizable policy that includes LTCi in the base policy and adds on coverage for Medicare Advantage and Supplements for about $5.20/month as an option. This is more like it. They spell it out.
Formerly, I had only looked at the deductibles, etc. What is more important is COVERAGE! I don't know how many of you out there have scrutinized your E&O, but think about it. What good is it to have E&O at all if it doesn't cover what you do?
Speaking of deductibles... mine is lowest for the sponsored carrier ($1000), but $2500 for others. Did you know you can get non-sponsored E&O? I didn't. Take a look at NAPA... NAPA Insurance Benefits & Services For Insurance Agents Another issue with a sponsored E&O policy is that if you lose your appointment, you lose your E&O. (edit: guess what? NAPA is also a product sold by the same outfit that sells the BCS policy!)
You might also want to determine if defense costs are included in your policy limits. Mine didn't until just this year. This gives me first dollar coverage for defense costs whereas previously I would have had to satisfy the deductible before having attorney fees paid in the event of a claim.
I am sure some of you out there can add to the list of features most desired for L&H agents. Comments?
Update: I called my E&O Administrator (MGA Services) today... turns out that they use broad language to describe the areas of coverage, so that LTCi IS covered, as well as Annuities, not to mention variables (which I don't sell). The last point is what I am pleased with: I am not overpaying for this coverage... but in fact saving about $130/yr over the cost of these bundled features due to group discount. Furthermore, my policy is guaranteed renewable... which other products may not be, requiring me to submit to UW annually. One claim with these other products, and I may be out!
My assumption was that if an area of insurance sales was not named, it would not be covered. Not true in my case. I think it may still be the case in other policies.
-----------------------------------------------------
Well, folks, this old dog has had to learn some new tricks. When I first got licensed about 4 years ago, I was given an application for E&O by my GA and told to sign it because I couldn't get carrier appointments without it. Not being an insurance agent but one month at that time, I trusted him and signed up. As a matter of fact, I renewed that contract each subsequent year, having only looked at the price of competing policies and staying put because mine was the lowest price I could find.
That has changed now. I tell my clients: Coverage first, then cost considerations. What good is it to have a cheap policy if it doesn't cover your needs. I need to take my own advice.
I just discovered that my E&O (BCS) does not provide for LTCi, which I want to sell, but does cover securities, which I do not sell. I never realized that other E&O carriers have a widely differing array of coverage options. Mine does not break down into optional choices for me... it is an all or none type. Take it or leave it. But most of all, I never realized that LTCi was not covered. I made a BIG assumption! (edit: Not true. See edit comment below)
I see that CalSurance (CNA) has a customizable policy that includes LTCi in the base policy and adds on coverage for Medicare Advantage and Supplements for about $5.20/month as an option. This is more like it. They spell it out.
Formerly, I had only looked at the deductibles, etc. What is more important is COVERAGE! I don't know how many of you out there have scrutinized your E&O, but think about it. What good is it to have E&O at all if it doesn't cover what you do?
Speaking of deductibles... mine is lowest for the sponsored carrier ($1000), but $2500 for others. Did you know you can get non-sponsored E&O? I didn't. Take a look at NAPA... NAPA Insurance Benefits & Services For Insurance Agents Another issue with a sponsored E&O policy is that if you lose your appointment, you lose your E&O. (edit: guess what? NAPA is also a product sold by the same outfit that sells the BCS policy!)
You might also want to determine if defense costs are included in your policy limits. Mine didn't until just this year. This gives me first dollar coverage for defense costs whereas previously I would have had to satisfy the deductible before having attorney fees paid in the event of a claim.
I am sure some of you out there can add to the list of features most desired for L&H agents. Comments?
Update: I called my E&O Administrator (MGA Services) today... turns out that they use broad language to describe the areas of coverage, so that LTCi IS covered, as well as Annuities, not to mention variables (which I don't sell). The last point is what I am pleased with: I am not overpaying for this coverage... but in fact saving about $130/yr over the cost of these bundled features due to group discount. Furthermore, my policy is guaranteed renewable... which other products may not be, requiring me to submit to UW annually. One claim with these other products, and I may be out!
My assumption was that if an area of insurance sales was not named, it would not be covered. Not true in my case. I think it may still be the case in other policies.
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