Curtis M. Pearsall
by Curtis M. Pearsall, CPCU, AIAF, CPIA President – Pearsall Associates, Inc.
When many individuals in agency management think of errors-and-omissions (E&O) loss prevention, the main thoughts probably center around documentation, exposure analysis, proposals and policy checking, to name a few. These issues, after all, play a critical role – good or bad – if the agency becomes involved in E&O litigation.
Ironically, an area that does not receive the proper level of attention is human resources (HR), which should have a much greater role than just the completion of paperwork when someone is hired or terminated, the tracking of vacation days, and the handling of the agency’s benefits program. Because, as the saying goes, “insurance agencies don’t make mistakes, people do,” wouldn’t it make sense to include the area that’s heavily involved in the selection and training of people?
HR plays a key role in recruiting the right people and fostering a culture based on integrity, client service and quality management. Areas where your HR department should have its hand in the development of a strong E&O culture and commitment include:
Job descriptions. Without these, there may be a disconnect on the responsibilities and expectations of each staff member, with some doing what they believe their job is as opposed to what the actual expectations are. Most management will state, “I just need the staff to do their jobs.” For this to have a greater chance of being a reality, it would make sense to have a document that advises employees on what their jobs are.
While most job descriptions will include job duties and responsibilities, qualifications, etc., consider adding a statement such as, “the employee is responsible for adherence to the stated expectations and procedures of the agency in the area of E&O loss prevention.”
Ensuring the firm is properly staffed with qualified individuals. Having the right people greatly determines an agency’s success. Recruiting and the identification of “tomorrow’s employees” are vital.
Staff training. This is essential and should be an ongoing objective, not just when a new employee starts. There are many training opportunities including courses (electronic and classroom) on topics such as products, technology, sales, customer service, and others. In addition, industry publications are excellent training sources. With constant changes in the industry, the agency should have programs in place to provide the staff with the necessary knowledge and skills.
Performance appraisals. The staff needs to grow for the agency to grow. Performance reviews should be done at least annually and contain goals for the following year that enhance the agency’s overall E&O culture.
Don’t underestimate the impact
Does your agency have any employees working remotely? If so, HR should ensure that policies and procedures are developed to address situations that may arise with remote workers. These employees are subject to the same standards of quality service as their onsite co-workers.
If the agency uses independent contractors to fill any roles, these workers should be managed in compliance with applicable laws and regulations, and there should be a written agreement that details expectations and processes.
Agency management should not underestimate the impact HR can have on taking the agency to the next level of E&O commitment. It is more important than many may believe.