Insurance Agents And Brokers Professional Liability Insurance
Insurance Agents and Brokers Professional Liability Policy protects against loss due to wrongful acts committed by an insurance agent in the course of providing services as an agent or broker.
The insurance company agrees to pay amounts the insured is legally obligated to pay as damages because of a wrongful act. However, this insurance must cover the wrongful act.
For example, Ginny works for Best Agency Ever, Inc. She misfiles several applications, resulting in five parties not receiving homeowner policies. During a tornado, two of the parties have losses to their homes. They both sue Best Agency because neither had a policy in force. Best Agency’s Insurance Agents and Brokers Professional Liability Policy would handle the lawsuits.
A wrongful act is a term that is defined, consisting of the following:
- The act must be committed, or alleged to have been committed by an insured
- An act, error, or omission must either have actually occurred or is alleged to have occurred.
- The act, error, or omission must arise from professional services.
- The professional services could have been rendered or should have been rendered but were not.
- Damages must arise from the alleged or actual act.
Besides covering wrongful acts and insurance company would also handle the, often, high expense of providing a legal defense against lawsuits.
A typical Insurance Agents and Brokers Professional Liability Policy includes additional protection such as Spousal Liability (protects the assets of an insurance professional’s spouse that may be named in a lawsuit), protection of innocent insureds and claims that are related to instruction of insurance courses.
There are various situations that are not eligible for coverage under an Insurance Agents and Brokers Professional Liability Policy including instances of abuse, bodily injury, property damage, contractual liability criminal activities, investments, electronic data and many other instances. The exclusions involve either areas that are covered by other types of coverage or which are ineligible for insurance protection as a matter of public policy.
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