05
Jan
2009

Check and Double-Check

Risk Management

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PUBLISHED ON: January 5, 2009

Major advances over the past decade have been embraced by businesses in virtually every sector, except one—the insurance industry. The insurance industry has been slow to change its business practices and nowhere is this more noticeable than in preparation and delivery to policyholders of their property/casualty insurance policies.

One common problem for policyholders is that insurance policies are frequently finalized and delivered by insurers months after policy inception—if they are delivered at all. Another problem is that insurance coverage documents may be riddled with errors. It is not uncommon for an insurance broker to check a policy after issuance and discover significant errors, assuming the broker even reviews the policy in the first place. Many brokers do not, and even among those that do, the process of checking the policy is often delegated to people within the brokerage who have limited knowledge of what coverage is required by the policyholder and what some of the critical negotiations over coverage may have involved during the purchase phase.