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Client Claims:  How to Avoid Client Claims Turning into E&O Claims 

By: Mallory Cornell | IIAW Vice President & Swiss Re Approved Auditor

Did you know that how you handle client claims can increase your E&O exposure? Like many internal workflows of the agency, not having clear guidelines and procedures for employees can lead to poor client claim experiences as well as an E&O situation. A few key reminders should be shared among ALL staff, regardless of role and experience.

It is common for independent agencies to want to be involved in the claim experience for customers, especially within personal lines business. The claim experience can be emotional for clients, so it does make sense that an agency would want that relationship touchpoint and offer their assistance. The danger is when there is insufficient training to help agency personnel remain helpful and empathetic without confirming or denying coverage in the policy.

Fortunately, strong claim-handling practices start with a few quick and easy reminders.

  1. Never confirm or deny coverage when speaking with the customer about a claim. This is the carrier's decision and responsibility, and the customer may be withholding additional information important to the claim outcome.
  2. Always report the claim promptly to the carrier. A claim reported to the agency is considered a claim reported to the carrier, so it is absolutely the responsibility of an agency to make the report as soon as possible.
  3. Your client’s information is confidential and should only be shared with the carrier and no other third party without written permission.
  4. Document! Document! Document! Keep strong written documentation of client conversations and carrier conversations. Always confirm phone calls in writing and utilize activities and reminders to follow up on open discussions.
  5. Have a standard process. This could include utilizing dedicated staff to handle claim calls, setting reminders to follow up on a claim call, or simply assisting with the claim reporting process and then informing the customer they can reach out with any questions or concerns. Just. Be. Consistent.
  6. Be proactive. Before a client ever has a claim, have a standard document or process to help the client understand the claim process from the inception of their policy. Set expectations and a clear understanding of the client-agency-carrier relationship.

All agency personnel should feel comfortable handling claim calls and can maintain a strong relationship with the client during the process. Remember, not everyone is fortunate enough to work in the insurance industry and clients may have unrealistic expectations of how the claim will be handled. Be honest and responsive and always have a plan in place. If a claim may be denied or if the agency made an error in issuing the policy, do not try to make it right. Generally speaking, an E&O claim arises when a customer has an uncovered loss, so it is imperative that the claim handling process is clear and consistent.

If you’re looking for ways to improve your claims process or update other workflows, visit to learn more about their Operational Improvement Review today!

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