Businesses around the country are reopening or resuming semi-normal operations. They may realize that their insurance policies likely do not provide coverage for COVID-19 claims. Property policies typically require direct physical loss, CGL policies may have communicable disease exclusions like the ISO CG 21 32.
As a result, insureds may be seeking noninsurance risk management advice from agents. For example, the Big “I” Virtual University’s “Ask an Expert” service received the following question from an agent:
“We have several clients that are nonprofit private swimming pool clubs. As we begin to reopen after the pandemic, these organizations are looking to us for how best to reopen safely and how their insurance will respond. We know that their insurance will not respond to a COVID-19 related lawsuit, but how can we help with waivers and standard procedures that will give them a level of comfort that they can reopen?”
First of all, E&O experts recommend that agents should not opine about coverage for COVID-19 claims, but rather refer questions to the carrier(s). I wrote about that in this article.
Almost three years ago, I wrote about “The Danger of Being Too Helpful.” In this article, I provided a dozen examples of agents providing advice that likely go beyond the norm for an insurance agent (possibly resulting in a lack of E&O coverage if a claim or suit arises from the advice) or otherwise exceed the expertise of most agents and, as a result, heighten the E&O exposure. They also don’t serve the customer well if the advice provide isn’t appropriate.
In the example above, unless you have a license to practice law, you should probably not be assisting customers in drafting liability waivers. Unless you have a license to practice medicine, you should probably not be assisting customers in drafting procedures for minimizing COVID-19 exposures. Even seasoned risk management experts would want professional counsel in assisting a customer.
The CDC has advisory practices for various types of businesses and health exposures. For example, this page on their web site addresses “Healthy Swimming.” The customer of this agent can dig deeper on the CDC web site for advice and seek guidance from local health officials. For waivers, the customer should consult with a qualified attorney.
The hallmark of a good agent, especially those providing customer service, is a desire to be helpful to customers. However, exceeding one’s expertise is probably not being helpful and, in fact, can be dangerous to both the customer and the agency’s E&O policy.
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