Insurance pros sell protection! Both insurance buyers and sellers want to depend on its availability to respond to losses. However, payments often become centers of serious disputes. Insurer profitability and viability are connected to making payments that qualify under policy provisions and that includes having proper notification regarding settlements.

A policyholder under both a personal and an umbrella policy was involved in an accident caused by another driver. The other driver's insurer paid out its policy limits, but the amount was far too low to handle her injuries. She first accepted Underinsured Motorists coverage from her primary auto insurer and then made a claim for additional UIM coverage from her umbrella provider. The umbrella provider disputed payment because it was not notified of any settlements until after they were made and the other driver received a premature release from its policy holder.

Click here for details on how a court viewed the insurer's argument that it's insurance contract was breached.

The issue at the core of losses like the above is poor communication. One can't escape the importance of keeping everyone in the loop. Whether a person causes an accident or is the victim of one, his/her handling is accompanied by many obligations, such as sharing information with others. There is no room for making assumptions. A given loss may appear to be straightforward, but timely notification of a loss and loss circumstances to authorities (as required), insurance agents and insurance companies is the surest way to start the process of dealing with a loss and its aftermath.

There are specific insurance policy provisions that appear dry, technical and unimportant. However, there are reasons they exist and they must not be ignored.

Click here for an excerpt of wording regarding an insured's various duties, such as "Notification" found under the Personal Lines, Automobile Section of Gordis on Insurance found in Advantage Plus.

Insurance customers must be made aware that, while they don't have to understand insurance intricacies, they definitely are responsible for meeting a variety of basic obligations. One of the most impactful ways to serve our clients is to explain their duties. It's not as exciting as making new or additional sales or as lucrative as snagging a renewal, but it's important! A policyholder who is uninformed may, after an occurrence, become one who ignores or overlooks a simple duty. That mistake could result in delays, confusion, litigation and even in the loss of coverage.

Be proactive! Take steps to see that your clients are aware of their responsibilities. Methods to do so can be combined with actively sharing other information, such as discussing simple risk management. That can be used as an excellent segue.

Click here for an example of a letter that may be distributed to customers, it is just one of dozens of different ones from Business Building Letters found in Advantage Plus.

Honestly, we improve things for everyone when we can do anything that assists how insurance operates. When customers are confused, problems follow. Stake can go from simple customer dissatisfaction to a period of lengthy, expensive litigation. We can demonstrate our value as insurance professionals by attending to the details that can avoid or at least mitigate situations. Making policyholders aware of obligations can be accomplished in a variety of ways. Besides the above instances that mentioned sources of typical policy language or initiating queries, other tools are available.

Your effort to educate clients may also be aided by sharing specific discussions, written in a consumer-friendly manner.

Click here to see a discussion of the Notification obligation that is one of hundreds of topics from E-Marketing For Agencies found in Advantage Plus.