Claims Adjusters Liability Insurance
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Claims Adjusters Liability Insurance Quotes
In today’s increasingly litigious business environment, insurance companies and their adjusters have the need of purchasing liability insurance for themselves. Insurance Adjuster’s Professional Insurance is a specific variation of Professional Liability (or Errors & Omissions) Insurance designed specifically for professionals in the insurance industry.
This type of insurance generally protects insurance firms and adjusters from financial losses and expenses (including legal fees) that result from a lawsuit (even a frivolous one) filed by any person who had some dealings with the company through an adjuster. Claims usually stem from some charge of “bad faith,” negligence, or misrepresentation, failure to provide adequate coverage, or improperly handling a claim. Some policies also protect against slander, libel, and breach of contract. Think of professional liability insurance as a type of “malpractice” insurance for professionals. Not only does it protect your assets, it can help protect your reputation.
What Claims Adjusters Insurance Is Not
Insurance professionals should be the first to know that they need to seek out professional liability insurance before a claim has been made against them, not after the fact.
Who Needs Insurance Adjusters Insurance?
Insurance companies and/or independent agents need professional liability insurance. It may actually be required by some states, and even if it isn’t, it usually makes good business sense to carry it, especially if you are involved in the claims department of the insurance business. A professional liability policy adds an extra measure of legitimacy to your practice, and gives prospective clients more confidence in your professionalism.
Insurance adjusters who work for insurance companies may elect to purchase additional professional liability coverage to offset a large deductible or to increase coverage limits.
Things To Think About
Insurance companies can usually lower the cost of premiums by having employees attend loss control seminars.
Some policies are designed specifically for property and casualty insurers, and others for those specializing in life, health, and accident insurance.
Most policies for insurance adjusters will cover partners, officers, producers, and full-time employees. If applicable, find out if a policy also covers part-timers and independent contractors like consultants.
You might also want to check with your professional association to see if they offer any type of professional liability insurance. Associations often offer it to members at a slightly lower cost.
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Frequently Asked Questions (FAQs)
Get clear answers to common insurance questions and important details to guide your coverage decisions.
What is Claims Adjusters Liability Insurance?
Claims Adjusters Liability Insurance, also known as Professional Liability Insurance or Errors & Omissions (E&O) insurance, is designed to protect insurance professionals, including claims adjusters, from claims alleging negligence, errors, or omissions in the services they provide. This coverage is critical for protecting adjusters from financial losses due to mistakes in claim assessments or settlements.
Why do claims adjusters need Professional Liability Insurance?
Claims adjusters play a vital role in determining the outcome of insurance claims. If a claims adjuster makes an error—such as misinterpreting policy terms, failing to investigate properly, or providing inaccurate settlements—the client could face significant financial loss. This could result in lawsuits. Professional Liability Insurance covers legal defense costs, settlements, and judgments, protecting the adjuster’s personal and business assets.
What does Claims Adjusters Professional Liability Insurance cover?
This insurance typically covers: Mistakes in Claim Assessments (errors in evaluating the scope of damage, liability, or policy terms), Failure to Investigate Properly (overlooking critical evidence or missing deadlines in claims processing), Negligence in Settling Claims (making incorrect or unfair settlements that result in financial losses for clients), and Legal Costs (coverage for legal fees associated with defending against claims).
What is not covered by Claims Adjusters Professional Liability Insurance?
This insurance generally excludes: Intentional Misconduct or Fraud (deliberate wrongful actions are not covered), Bodily Injury or Property Damage (covered by General Liability Insurance), Employment Practices (issues like harassment or wrongful termination are covered by Employment Practices Liability Insurance), and Cyber Incidents (data breaches or ransomware attacks require separate Cyber Liability Insurance).
How much does Claims Adjusters Professional Liability Insurance cost?
The cost depends on: Business Size and Revenue (larger agencies with a higher volume of claims may pay more), Risk Exposure (adjusters specializing in high-risk industries may face higher premiums), and Claims History (a clean record can help reduce premiums). Average Costs for Claims Adjusters: Small Adjusters or Agencies: $500–$1,500 annually. Larger Firms: $2,000 or more annually.
How can claims adjusters reduce their insurance premiums?
To lower premiums, claims adjusters can: Maintain Accurate Records (proper documentation and risk management practices help prevent errors), Use Clear Contracts (define terms, responsibilities, and settlement procedures to prevent misunderstandings), Maintain a Clean Claims History (avoid past claims to secure lower premiums), and Bundle Policies (combine Professional Liability with General Liability or Cyber Liability Insurance for potential discounts).
How do I choose the right Claims Adjusters Liability Insurance policy?
When selecting a policy, consider: Assessing Industry-Specific Risks (focus on claim evaluation, fraud prevention, and client disputes), Reviewing Policy Limits (ensure the coverage limits are high enough to protect against significant claims), Consulting an Experienced Agent (work with an agent familiar with the unique risks faced by claims adjusters), and Reviewing the Policy Regularly (update your policy as your business grows or services evolve).
What additional insurance should claims adjusters consider?
In addition to Professional Liability Insurance, claims adjusters should consider: General Liability Insurance (for protection against claims of bodily injury or property damage), Cyber Liability Insurance (protects against data breaches), and Employment Practices Liability Insurance (covers claims related to employment practices such as wrongful termination).
