Any company that provides services or professional advice is at risk of being held liable in an Errors and Omissions lawsuit or claim. This is why it’s imperative to have an insurance policy in place to financially protect your business and its assets.
In some cases, a lawsuit is unfortunately unavoidable. However, handling it with professionalism and knowing what to expect can get you through this process as painlessly as possible. The most important thing to remember, and remind your clients of if they are faced with a lawsuit, is there is no shame in being pulled into an E&O situation. It can happen to even the best agents, CEOs, Directors, etc.
When it comes to how to handle the suit, there are some very important things to avoid. These should be shared with your agency as well as with your clients.
- Don’t overreact. Take the experience and learn from it, making the necessary changes to ensure it doesn’t happen again.
- Don’t discuss the claim with anyone besides the claims representative, defense attorney, or any other member of the office directly involved.
- Don’t make any admission of liability or wrongdoing, and don’t offer to settle without your attorney’s consent.
- Don’t provide any written or recorded statement to the plaintiff without your claims representative present.
- Don’t allow inspection, copying, or removal of client files and records without consulting with the claims representative managing the claim. Don’t alter the file either.
- Don’t try to manage the claim on your own!
In the event that a trial results from the lawsuit, be sure to gather and organize all records related to the plaintiff and the situation. The claims representative will need all the unaltered information to conduct an investigation, and to prepare and provide a proper defense. Make sure also that you comply with all policy conditions and requirements. If the defense fails to comply, E&O coverage could be jeopardized.
An Errors and Omissions policy from PLRisk Advisors provides you, and your clients, with coverage that contributes toward legal defense costs, damage awards, and settlements. To learn more about our E&O policy features and what professionals we provide coverages for, please contact us at 855.403.5982.