E&O Weekly Prevention
  
Strategies for the Professional Agent
January 15, 2015
Agents of America






 


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AOA News, Views, Tips & More

Agents are sometimes unclear as to their duties relating to the financial condition of an insurer.  Some E&O carriers highlight the use of a rating agency and often reference a rating standard in the insolvency exclusion found in many E&O policies.  While ratings provide an important resource for agents, their use is not necessarily determinative of agent's due care.  Agents should understand their legal duties and the use of insurer ratings, being careful to substitute the judgment or requirements of their E&O carrier for their own professional judgment and the best interests of their clients, check out Part 1 of our featured article by Burke Coleman, Esq, on agent's liability regarding Insurer Insolvency.

 

By W. Burke Coleman, Esq. of Demotech, Inc.

 

PART 1 OF 2

 

An agent or broker generally has a duty to use reasonable skill, care and diligence to obtain the coverage requested by the customer or inform the customer of his or her inability to do so.  Except where a special relationship exists, agents typically have no continuing duty to advise, guide or direct a customer to obtain additional coverage.  But agents are sometimes unclear as to their duties relating to the financial condition of an insurer.  Some agents' errors and omissions (E&O) carriers highlight the consultation of a single rating agency, and often the insolvency exclusion contained in many E&O policies references a rating standard.  While courts have upheld the enforceability of insolvency exclusions, the insurer rating standards within the exclusion are not necessarily consistent with the legal standard of care for agents.

 

Insurance Doomsday Averted - TRIA Extension Passes Congress

By Frederick J. Pomerantz, Esq. and Aaron J. Aisen, Esq. of Goldberg Segalla LLP 

 

Under the cloud of the tragic terrorist attack in France, the U.S. Congress passed H.R. 26, an extension to the Terrorism Risk Insurance Act (TRIA).  The House passed it overwhelmingly by a vote of 416-5.  The Senate passed it by a vote of 93-4.  This despite a rider which amends Dodd-Frank.

 

Cyber Voluntary Payment Defense Thwarted by Bank Fraud Regulation

By Joseph F. Bermudez, Esq. of Wilson Elser

 

Financial institutions are one of the entities most threatened by cyber crisis events. As data breaches and cyber threats become more inventive, the risks to financial institutions and their clients continue to grow. However, as recent studies have established, no commercial area is free from a data breach or cyber attack. Policyholders and insurers must be proactive in regard to understanding the threats and risks involved with data breach.

 

Firings for Facebook Comments Unlawful, NLRB Rules

By Howard Bloom, Esq. and Philip B. Rosen, Esq. of Jackson Lewis P.C.

 

An employer violated the National Labor Relations Act by discharging two employees because of their participation in a Facebook discussion about their employer's State income tax withholding mistakes, by threatening employees with discharge for their Facebook activity, by questioning employees about that activity, and by informing employees they were being discharged because of their Facebook activity, the NLRB has ruled. The Board also ruled the employer's Internet/Blogging policy violated the NLRA. Triple Play Sports Bar and Grille, 361 NLRB No. 31 (2014).

 

A Negative Work Environment Does Not Equate to a Hostile Work Environment Under the LAD

By Thomas Paschos, Esq. of Thomas Paschos & Associates, P.C.

 

In Brian Dunkley vs. S. Coraluzzo Petroleum Transporters, 2014 N.J. Super. LEXIS 130 (September 16, 2014), plaintiff experienced racial discrimination by a fellow employee assigned to train him. When the incidents were disclosed to defendant, it effectively resolved the discriminatory treatment identified by plaintiff and precluded any further racial harassment through its formal anti-harassment and anti-discrimination policy, a developed complaint procedure and an investigation process. However, plaintiff maintained as a result of his disclosures, he endured negative consequences, which he insisted caused his constructive discharge. He noted his report was not kept confidential and he felt ostracized by co-workers.


By Brad Hammock, Esq., Frank Alvarez, Esq. and Joseph Lazzarotti, Esq. at Jackson Lewis P.C.

 

The spread of Ebola hemorrhagic fever (EHF) and the incidence of Ebola cases in the United States have raised issues for employers and employees on the appropriate workplace responses. Workplace safety and health, including measures to protect employees, leave and health management, labor relations and workplace privacy concerns all are implicated.

 

How to Assess Job Applicant's Discipline Level

By Michael Mercer, Ph.D.

 

Managers seldom talk about how good employee are people who use discipline.  They often feel it sounds to say employees need discipline.  In fact, employee discipline comes up in conversations only when an employee breaks company policies, and gets disciplined.

 

But, my research benchmarking pre-employment tests for hundreds of jobs in hundreds of companies consistently finds companies' best, most valued and productive employees practically always are very disciplined on-the-job.  

 

Ninth Circuit Ruling on Misclassification of Independent Contractors Has Major Ramifications for Employers

By Sandra L. Snaden, Esq. and Caroline J. Berdzik, Esq. of Goldberg Segalla LLP

 

In Alexander v. FedEx Ground Package System, Inc., 2014 U.S. App. LEXIS 16585 (9th Cir. Aug. 27, 2014), the Ninth Circuit Court of Appeals held that former Federal Express drivers were employees rather than independent contractors pursuant to California's right-to-control test. This important decision is likely to reach across all industries and will cause regulators and attorneys to closely examine independent contractor agreements to determine if the employer retains sufficient direction and control over the manner or means by which the work is to be performed. This case teaches that no matter how workers are labeled by the employer, the substance of the work relationship is what controls the classification status. 






Letter From  the Publisher

NOW AVAILABLE ALL THREE BOOKS IN THE RISK MANAGEMENT SERIES

 

Book One -

20 Chapters - 450 pages

 

This book addresses the broad swath of risks from which claims against insurance agents arise. It provides clear and concise risk management and risk-avoidance guidance, and provides solutions for each of the potential claims issues. It also provides comprehensive discussion of the legal issues that may arise in such claims and how the various states treat those issues.

 

This is Book 1 of a three-part series. The primary focus of the book series is to provide insurance and legal professionals with keen insight into the issues that insurance agents face on a daily basis. While our society is more litigious than ever, through education and awareness, insurance agents can better understand this legal society and take the necessary proactive steps to minimizing the chances of their agency facing some form of E&O litigation.

 

SAVE 20%! Enter promo code WPD20 at checkout and the discount will be applied.  Offer valid for this book only.

 

 

Book Two -

18 Chapters - 587 pages

 

This book identifies and explains the E&O issues and exposures related to the typical new and renewal sales process within insurance agencies. Solid detail is provided addressing the E&O exposures for agencies during the pre-sale, sale and post-sale periods. The course addresses such issues as the legal duties of both the agents and their customers, the critical importance of education of both the staff and customers, the benefits of account reviews and the power of a signed application. Throughout each chapter, best practice solutions are provided to help agents manage those exposures. 

 

This is Book 2 in a three-part series. The primary focus of the series is to provide insurance and legal professionals with keen insight into the issues that insurance agents face on a daily basis. While our society is more litigious than ever, through education and awareness, insurance agents can better understand this legal society and take the necessary proactive steps to minimize the chances of their agency facing some form of E&O litigation.

 

SAVE 20%! Enter promo code WPD20 at checkout and the discount will be applied.  Offer valid for this book only. 

 

 

Book Three -

18 Chapters - 746 pages

 

This book identifies the unique E & O issues and exposures of the various lines of business, including personal auto, homeowners, general liability, directors and officers liability, and employment-related practices liability. Each chapter contains solid detail for a specific line of business, and provides best practices and solutions to help agents manage those exposures.

 

This is Book 3 of a three-part series. The primary focus of the series is to provide attorneys and insurance professionals with keen insight into the issues that insurance agents face on a daily basis. While our society is more litigious than ever, through education and awareness, insurance agents can better understand this legal society and take the necessary proactive steps to minimize the chances of their agency facing some form of E&O litigation.

 

SAVE 20%! Enter promo code WPD20 at checkout and the discount will be applied.  Offer valid for this book only.  

 

 

Is your Insurance License renewing soon? 

Is your agency licensed in multiple states? Does your agency maintain nonresident licenses?   Do you know when renewals are due? Did you know a resident change requires address changes in the states in which an individual holds licenses? If you need assistance with any of your licensing needs go to the experts Supportive Insurance Services

 

Do You Need Continuing Education?

Complete your entire State-Required CE Online with WebCE! AOA has partnered with WebCE, a leading nationwide provider of Continuing Education for insurance professionals to provide you with state-approved self-study CE courses to satisfy your CE requirements online!  Check out your CE State Requirements. 

 

AgentsofAmerica.ORG newsletter is FREE! Also, if you have any thoughts, comments or suggestions, please email me at info@agentsofamerica.orgWe also would like to extend an invitation for you to join AOA's LinkedIn group at AGENTS OF AMERICA

 

"Bringing the Best Together"
Angelo J Gioia
Publisher

"The majority of men meet with failure because of their lack of persistence in creating new plans to take the place of those which fail."  Napoleon Hill


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