Best time to buy E & O ???
- Thread starter CJ Tibbs
- Start date
- 30,457
The pricing is based on how many months are left in the E & O carrier's policy year.
- 4,949
Before you need it for sure
- 26,046
Better to have it and not need it, than to need it and not have it.
- 4,949
This isn't a backhanded joke is it about a transgender person needing to use something but no longer has it to use? Never know when to take you serious or not.
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maxherr
Expert
- 71
Nearly all E&O policies offered to those of us in the industry have effective dates of 12-1. So if you are purchasing a new policy after that date, the premium is being pro-rated to the next 12-1 renewal date (typically quarterly). All the E&O policies I have ever had have been issued with "fully earned" premiums, meaning no refunds for early termination.
The **most important** thing to know and remember is to NEVER have a lapse in coverage under E&O insurance. Feel free to change insurance companies every year, if necessary, to find the lowest cost, but a lapse in coverage means a loss of the retroactive coverage afforded in a CLAIMS-MADE policy . . . which is the type of policy that nearly all E&O policies are.
Along with this, you need to keep track of ALL E&O policies you've ever had (at least the insurer and policy number) from year to year in order to determine which policy is supposed to cover a CLAIMS-MADE claim for contribution purposes if sued -- your current E&O provider will provide your defense and pay the judgment, but they'll try to get reimbursed by the carrier that covered the time period of the alleged negligence, if different. (If you've had that lapse in coverage and cannot pinpoint the insurer/policy that would have covered it, you'll be SOL past that point.)
The **most important** thing to know and remember is to NEVER have a lapse in coverage under E&O insurance. Feel free to change insurance companies every year, if necessary, to find the lowest cost, but a lapse in coverage means a loss of the retroactive coverage afforded in a CLAIMS-MADE policy . . . which is the type of policy that nearly all E&O policies are.
Along with this, you need to keep track of ALL E&O policies you've ever had (at least the insurer and policy number) from year to year in order to determine which policy is supposed to cover a CLAIMS-MADE claim for contribution purposes if sued -- your current E&O provider will provide your defense and pay the judgment, but they'll try to get reimbursed by the carrier that covered the time period of the alleged negligence, if different. (If you've had that lapse in coverage and cannot pinpoint the insurer/policy that would have covered it, you'll be SOL past that point.)
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