Other Coverage Flashcards
1
Q
Professional Liability
A
- Malpractice: Physicians and Errors and Omissions exposures for professionals
- Attorneys, insurance agents, accountants, etc
- Directos and Officers (D&O)
- Fiduciary Liability
2
Q
Claims
A
- Written on claims basis
- Usually include a condition allowing insurer to settle out of court without policy holder’s consent (Ergo Clause = Defend Reputation) - Emotional
- Self Insured retention ($10,000) or more is often included in policies but rare for liability
- Other factors include market trends (accounting scandals), job market, and local trends
3
Q
Why rare for self insured plans to liability?
A
- Professionals are more aggressive and better with management
- Have deeper pockets to absorb costs
- One of few liability polices that have deductible
4
Q
Underwriting Professional Liability
A
- Medical Malpractice
- High risk: specialists, anesthesiologists, neurosurgeons, OB-GYN
5
Q
Professional Liability Underwriting Considerations
A
- Years in practice
- Education
- Professional Reputation
6
Q
Specialty Influence on Professional Liability Underwriting
A
- Usually represents higher risk in other areas as well
- Lawyers, accountants, insurance Agents
7
Q
Insurance Agent and Broker (E&O)
A
- Failure to properly advice client of their insurance needs
- Failure to obtain insurance for client in timely manner
Failure to renew policy at expiration without giving prior notice - Faulure to advice client of policy limits
8
Q
D&O Liability
A
- Covers Corporation’s D&Os against liability
- That is not covered by CGL or auto
- Usually tied to company decisions that adversely impact financial performance of from (stock price)
9
Q
D&O Exclusions
A
- Libel or slander
- Gaining Personal Profit illegally
- Acts of deliberate dishonesty
- Liability under ERISA
10
Q
Excess and Umbrella
A
- Purchased to extend limits of CGL, auto and other liability coverages
11
Q
Why Excess and Umbrella Needed?
A
- Black Swan: Rare and expensive Claim
12
Q
Excess and Umbrella: Maximum Probable Loss
A
- (MPL)
- Absolute Loss Possible (Regardless of Loss)
- Easier to estimate for property
- How Much? What is it Worth?
- What costs to rebuild?
- No comparable way to estimate MPL for Liability Coverages
13
Q
Coverage layers
A
- In Property: high loss exposure can often be covered entirely by one insurer
- High LOL is usually arranged in Layers
14
Q
LOL Coverage Layers
A
1) Primary Coverage
2) Excess Coverage
- Less expensive as coverage increases
15
Q
Excess and Umbrella Needed When?
A
- Damages exceed occurrence limit
- Aggregate is reached
- Only usually come into play when underlying policy is exhausted or has reached its limit
