Opinion on E&O for Less?

Getting a *quality* E&O for P&C for 1500 to 1800?

I'm going to respectfully disagree (aka call bull for some of you readers) for a couple of reasons.

1)E&O for P&C is substantially more than for L&H, all other things being equal. More chance of loss, more chance of lawsuits, and there are more chances for errors on the part of the agent. The average L&H E&O for agents that have 1+ years of experience is around 500-1000/year depending on lines you work and volume you produce, and the state.

2) The person is indicating that they are a newer agent for the fact that they are getting E&O for P&C now. That means that they don't have the P&C coverage right now that most E&O companies look for, meaning that they will either decline him going somewhere like Utica (or a standard carrier) or rate him in the 2-4k range. E&O carriers look for years of continuous E&O coverage, similar to other P&C companies when writing policies. If you don't have ANY, then the E&O requested time of 1-3 years is definitely not going to be met.

3) There are 2 types of E&O to look at. One of them is the standard E&O, and the other is the E&S E&O. At this point in the game, the OP is going to qualify for the E&S E&O simply because they don't have E&O insurance history, nor a lot of P&C experience. The difference will be the types of coverage. The E&S E&O (from when I was reading up on them, I'm a P&C agent) will not cover legal fees above and beyond your limits, they are a part of the 1M you have. ALSO, the E&O will typically only cover yourself, NOT the agency. There are a few other differences as well that people take for granted that you won't get for the E&S E&O. One thing to take away from that is to have higher than a 1M/1M limit because if someone is suing you for 750k, you will probably eat more than 250k in legal fees, which puts you over the 1M limits. GO for 2M or 3M if a company offers it.

I suggest for the OP to get some kind of E&O that is inexpensive now, like E&O for less or the NAPA E&O or Rockwood. Hold it for 1-2 years as an independent individual, keeping your nose clean and writing a lot of business, and then move to a standard E&O company like Utica, which does a good job in my area. You won't have any issues making the change when it becomes time, and your rates will be more manageable. Another good idea is to get a very cheap E&O policy and then work under a principal agent where you are covered under their E&O. Your E&O won't be used but the principal will usually have a standard E&O that covers you- this allows you to get the years of E&O coverage that you need while getting experience and not screwing up as much when having someone else help.

Granted, all of these things come from a NC perspective but I'm sure a lot of this is going to hit home for most other states.

Hope this helps!

EDIT: OP, what was the company that quoted you 2k? Have you gone through a P&C agency in your area?



Thank you soooo much for such a detailed, helpful response! :1cute::) this is why I love this forum. Now I know that this e&o for less program is the best fit for me since I'll be the only agent writing policies and I'm very glad to know that I won't have to pay $2,395.00 a year! Nobody in my area sells e&o, I was always covered under my employers so I never gave it much thought until a couple months ago when I decided to go Indy. I asked one of the local agents where they have their e&o and I was referred to a few agents out of the state. I couldn't ever get ahold of any when I called except CITA from CA. That's where I got that quote....oh and the company is Admiral Ins. Co. Everyone kept telling me e&o for new agents is in the 2k a year range so I thought this quote was normal.....glad I asked this forum!
 
You also need to know that the E & O for Less policy restricts coverage to only certain lines of business. Check it out in section III, item "O" Professional Services. As I read it there is no coverage for RV's, Motorcycles, Inland Marine, BOP's and incidental L & H.

I also made a post in answer to NCPCLHnoop's post above which has information that needs to be clarified.
 
Guru,

I won't say there is "bull" in your response, but there is a LOT of miss-information. I will stick to the fact that 1,500 -1,800 "quality E & O is available.
 
Well since there is mixed reviews on e&o for less, can you guys give me other options please (remember I'm a new agent, not many companies want to sell me e&o and the ones that will want an arm and a leg)
 
I got mine through e+o for less... It's a Marsh policy underwritten by CNA. Both are reputable companies.
 
One reason why it is so hard for a new P and C agent is that E and O cost so much for P and C agents....
 
E&O for less is written through CNA/Marsh. Are you really saying that it isn't a decent E&O policy? Or are you confusing this with another plan that is out there?

It's not available for me in CA, so I haven't really looked into it, but I would be a bit stunned if there were large holes in the policy. I can't say there isn't, I haven't read it, haven't really looked into it, just seems a bit strange to me.

Does anyone have a policy sample they would be willing to share?

Dan
 
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