E&O for P&C agency- Admitted Vs Non-Admitted

infoe

Guru
100+ Post Club
As I source E&O for my agency...a non admitted carrier if they went insolvent would not be subject to the state gaurantee fund. The quote I have is with Admiral Insurance company (a berkley company) with an A+ rating and a Financial Size Category: XIV

I'm guessing they just dont go through the hoops of becoming admitted in every state...and also semi safe to assume with a great rating they are'nt going belly up.

Would that be a concern to you? If they went belly up, could I not go to another carrier and request continuous coverage
 
From the size and rating, I doubt it will go belly up. Could happen though, but I'd be more concerned on a B+ rated company.

That said, I think if they went belly-up and you went elsewhere, you would likely still have a break which could cause a problem with your tail coverage on previous acts. Not really sure how this would work. I think you would be okay as far as rates go as long as you didn't have an excessive gap (30 days??? not sure).

My coverage is also with a non-admitted carrier, very similar situation though, big enough and rated high enough it didn't seem like much of a risk.

I also assume an E&O carrier paying out multiple huge claims all at once is a bit slim, unlike a P&C carrier who could get wiped out of existence in a state due to hurricanes or wildfires (not to say this has happened, at least not this year that I am aware of).

Dan
 
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