Trusted Life Agents Have E&O Insurance

There are two reasons life agents should carry E&O insurance. The first has to do with them. The second has to do with their clients. Let’s take a closer look at each perspective.

Life Agents Buy E&O Insurance for Themselves

The reason life agents buy E&O for themselves is because what they do for a living is inherently risky. Think about it. Every day you help clients deal with complex financial matters involving potentially tens of thousands or even hundreds of thousands of dollars. In fact, when an affluent client buys life insurance to fund an estate transfer, literally millions of dollars can be on the line. Making a mistake or forgetting to do something that botches such a transaction can leave you susceptible to potentially career-ending lawsuits.

Another reason life agents need E&O for themselves is because they often work with older clients who may have cognitive impairments. Such clients may authorize a purchase that their children find unsuitable. When this happens, the clients’ beneficiaries, who often stand to inherit large estates, are not shy about making their views known. Worse, if they think the agent took advantage of their ailing parent, they will not hesitate to file regulator complaints or even sue a life agents.

And let’s not forget today’s unsettled regulatory environment, especially around the U.S. Department of Labor’s Fiduciary Rule. Although the rule went partially into effect on June 9, 2017, it might still be revised, watered down, or cancelled prior to its full effective date on January 1, 2018. Until then, life agents who sell retirement products will be expected to serve a client’s best interests. And if they don’t, they run the risk of clients and their attorneys suing them for breach of fiduciary duty.

Finally, let’s not forget that many life agents work in home-based offices, either for themselves or for a life insurance agency. In either case, they may lack dedicated administrative support. This means they have to handle all their own paperwork, including the filling out and filing of life insurance applications. Because sales, not paperwork, is their forte, life agents who work alone may make mistakes that create E&O liability risks

Put the above factors together and what do you have? A compelling reason for you to buy E&O insurance to mitigate your business risks. But equally important is the need to buy E&O insurance for your clients’ sake.

Life Agents Buy E&O Insurance for Their Clients

Although it’s human nature to assume one will never make a mistake, the fact of the matter is mistakes happen, even to the most experienced life agents. And if the worst comes to pass, ethical life agents realize the importance of both protecting their businesses against legal claims and making their clients whole financially. They are rewarded for this because people would rather do business with agents who take responsibility for their mistakes rather than those who shirk responsibility in order to save money.

In short, life agents who wish to build and maintain a sustainable practice know they must always be selfish and selfless when it comes to E&O insurance. They must protect their own financial interests so they can continue to work in their business, while at the same time being responsible for any harm they cause to their clients. The beauty of E&O insurance is that it allows life agents to cover both bases for a reasonable cost, for as long as they keep their E&O policy in force.

In today’s busy, stressful world, any product that helps the seller and the served as powerfully as E&O insurance does is a product worth having, especially if it builds trust as well.

So here’s the bottom line. Are you in the market to buy E&O insurance for the first time or looking for an alternative to your current E&O coverage? Then consider the benefits of buying from EOforLess, an online source of affordable and convenient E&O since 2008. EOforLess specializes in meeting the needs of life agents with quality protection at a low cost, making it a huge win-win for both them and the clients who trust them.