The ability to assess information and act accordingly is critical when dealing with business priorities. Our highest priority is to make sure your firm is properly protected – whether through standard insurance, self insurance, risk mitigation techniques, or captives. An expert broker is able to assess your situation and act in your best interest. Consider these recent examples:
Claim During Policy Period
A Michigan accounting firm reported a claim during their policy period. At renewal, the underwriter indicated that they planned to increase the premium 15% and take the deductible from $5,000 to $10,000. Acting as an advocate, the broker on the account scheduled a conference call with the managing partner from the accounting firm, the underwriter, and the claim adjuster working on the matter. During the conference call, the firm had a chance to explaine the additional risk management steps and corrective measures taken by the firm. The underwriter was also able to ask a few additional questions of the firm and get first hand feedback from the claim adjuster. After this call, the underwriter kept the deductible at $5,000 and increased the premium only 5%.
A growing accounting firm with three East Coast locations where facing tough decisions as they expanded. Their growth was fast and they feared that the internal procedures and quality control documents were not keeping up. Externally, they were also facing some scrutiny as clients said they were not getting reports as quickly as they had been in the past. Internally, seasoned staff complained that there were not enough resources available to keep up with the demand and changing needs of the client base.
At our mid-year check-in, the firm disclosed these difficulties to us and we were able to recommend a number of resources that not all the partners knew they had access to. At their previous renewal, they decided to go with a reputable insurance carrier who offered engagement letter templates, quality control document samples, and resources to help them get their practice in order after the expansion. Later that year, they were able to use the “claims hotline” their insurance provided and spoke – free of charge – with an attorney about a potential matter. The attorney offered a suggested courses of actions and the firm was able to avoid a lawsuit altogether.
Merger Reveals Hazards, Price Increase Mitigated
A $3M revenue accounting firm was looking to grow and decided that an acquisition of another local firm was the best route. When the two accounting firms announced their intent, an insurance due diligence report on the other accounting firm was conducted. From the interview, it was discovered that a number of potential claim situations had gone unreported to the insurance carrier. Since the clients were going to stay through the acquisition, the combined firm would be left with no coverage for any claims that stemmed from these matters. Recognizing the dangers, certain actions were taken before the acquisition that prevented this risk from spilling over into the new firm.
When it was time to renewal the firm’s insurance, the premium jumped up considerably due to the large and sudden growth of the firm. Anticipating this event, additional options were solicited and the premium increase was kept to a reasonable level.