Coverage Problems: How “Little” Things Make a Big Difference

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In this episode of The Digital Broker, Ryan Deeds and Melissa Wilder talk about details that complicate coverages and how to spot them. By listening to this episode, you will learn:

• What kind of “little” things can wreck a coverage; where to find them; and how they vary from niche to niche
• How to protect yourself against oversights by inviting the perspectives of your team, your mentors, and carriers
• Which other resources you can consult to make sure you’re up-to-date on coverage details

At the heart of every renewal process is a fundamental question: “Do we remarket, or do we stay with the current carrier?” If the insured and the carrier are satisfied with the current coverage, there’s not a lot more to worry about. But what if you decide to switch?

Insureds rightfully expect that everything about their pre-existing coverage—everything important, anyway—will more or less stay the same. Usually, it does. Competent account managers know how to check for all the “big” things that define coverages in broad terms—valuations, exposures, deductibles, etc. But what about the “little” things?

Sublimits restrict payouts in opaque ways. Enhancements vary from carrier to carrier. It is easy to miss or overlook these things because they’re usually subordinate to the broader terms. Nobody pays that much attention to them until there is a claim—and that’s when everyone discovers how important they are.

Then why not take the trouble to inspect them early on? Usually, because of time. If you’re short on it, you start cutting corners, and the “little” things are the first to suffer. Much of our previous episode about the perfect renewal process stressed the importance of beginning the process on time. But time alone is unlikely to guarantee protection against every oversight. Education helps, but insurance is always changing, and you’re never done learning. Furthermore, every niche is different, with its own hot buttons that make or break a coverage but might not mean much in another niche. In this episode, we look at everything else you can do to stay on top of your insureds’ coverages and avoid surprises.

Chances are good that the best help is already available to you. We’re talking about your team. Can you rely on them to help you see the whole picture? The perfect renewal process, as we see it, is already a team effort: every stage of the process is spearheaded by a different member or members of the team. But the process must be complemented by conversation. Have we really taken the time to look at this coverage? The price is better, and the main coverage is the same—but are we looking at the exclusions? Are we looking at the sublimits? Is it really a better deal? And how can we communicate that to the insured?

In addition to your team, it is great to have a mentor. Whether you’re new to insurance or transitioning between niches, you will benefit immensely from the wisdom of someone who’s been there before, someone who knows what all the hot buttons are and where to find them. We don’t see as much mentorship in insurance as we think we’d like; it is as if people are timid about asking for help or guidance. But they shouldn’t be. All of us either aspire to be like someone we know or are a person other people aspire to be. Reach out to someone whose mentorship would improve your work.

Reach out to the carriers, as well; they, too, have a duty to do right by the insured. Many carriers will point out the finer details of coverage if you engage them about it. Some of them will go so far as to accompany you to meetings with the insured, to make sure nothing of significance is overlooked. If you meet a carrier that is happy to provide this sort of assistance, take advantage of it. Have them over at the office for a talk or a seminar. Always be in touch with your carriers about what they can do to help your insureds receive the best possible coverage.

You can also leverage certain tools without leaving your desk. Checklists can be a life-saver: much of their purpose is to keep people from missing things. It is unlikely that a single checklist can protect you from the infinity of little things that can devastate a coverage, but you could probably make a list of the ten or twenty items that most commonly create trouble and build a checklist off of those. We get you started on checklists and how to make one in this episode.

Finally, at the end of the day, it is okay to just look stuff up. Melissa Wilder is one of the most knowledgeable insurance specialists we know, which is why we have her on the show so often. And yet, she’s not above using Google when she needs to look something up in a hurry. If you’re looking for a more insurance-specific resource, Melissa recommends IRMI.com, where you can find information about everything that can come in handy during a renewal: forms, codes, manuals, certificates, etc.

Mistakes happen, even to the pros, and it’s no fun when they do. But if there’s something good that comes out of them, it is the opportunity to learn and do a better job next time. That is why we provide a space where insurance agents and brokers can learn from one another and get better together. Do you have a story about a “little” thing that turned out to mean a whole lot more? Has it taught you anything about how to keep from making the same mistake next time? Can you recommend another resource beyond what we discussed in this episode? Join our Digital Broker LinkedIn group and let us know.