Protect your business with American Guardian Insurance

The Arch Insurance E&O program includes a Vanishing Deductible. "If the Named Insured has continuously maintained insurance agents, brokers & consultants errors & omissions insurance through the Program Administrator listed on the policy Declarations during the last 5 consecutive 12-month Policy Periods & has not had a Claim made against them during the last 5 Policy Periods, the per Wrongful Act Deductible will be waived for the first covered Claim made during the current Policy Period up to a maximum of $25,000 or the amount of the Deductible, whichever is less."

 Loss prevention counseling is included with the Arch Insurance E&O program. 

Agents will have easy access to an experienced senior risk management attorney to confidentially discuss matters involving a potential claim, incident, or risk management inquiries. This feature is intended to help our clients prevent issues from arising or from turning into bigger problems and/or costly claims. Counseling available through this program is designed to address concerns such as the following:

• Issues raised by holding yourself out as a specialist
• Handling of a potential claim
• Failure to identify client exposure
• Communicating a potential error to a client
• Structuring your office’s policies, procedures and administration to prevent issues from arising

 Endorsements can be added to Errors & Omissions policies to further protect your agency.

• First Dollar Defense* 

• Defense Outside the Limits**

• Employment Practices Liability Extension Endorsement 

Policy & Endorsement Specimens are available below...

Agents should also consider increasing coverage limits as their agencies grow. 

*First Dollar Defense (FDD)  

First Dollar Defense (FDD) is an additional insurance coverage option that may be purchased onto an agency's professional liability insurance policy. You may also hear First Dollar Defense called a Damages Only Deductible, a Loss Only Deductible or Indemnity Only Deductible. 

When an agency carries first dollar defense coverage, if a claim arises, the insurance carrier pays the “first dollar” to defend the agency, and in turn, the agency only pays their deductible if indemnity is paid on the claim. 

First Dollar Defense speaks to a specific coverage option offered as additional support if a claim arises. With first dollar defense, if a claim arises where only defense costs are incurred and no indemnity is paid, the insured will not be responsible for their deductible amount, as the carrier covers the costs to defend. In turn, if a claim results in a loss payout, the insured will be responsible for their deductible amount.  

First Dollar Defense coverage means the deductible only applies to the damages that occurred within a claim and no deductible is required for defense expenses.

For example, let’s say that your agency is named in a claim, but it is found that your agency is not at fault and the claim was nothing of merit. In this case, only defense costs have been incurred, therefore, your firm would not be responsible for payment of your deductible while your insurance carrier paid to defend you.

 **Defense Outside the Limits (DOL) 

Legal costs can quickly exhaust your policy limit leaving you to pay out of pocket for claims and settlement. In order to have protection against both claims and legal expenses, when purchasing or reviewing any of your liability policies, professional, general or product, you should determine whether the policy includes coverage for legal defense outside the limits or inside the limits of liability.

• Defense inside the limit means that all defense costs (attorney’s fees, court costs, investigation and filing legal papers) are deducted first from the policy limit, which cuts into the overall limit of dollars available to pay for monetary damages awarded by a ruling.
• With defense outside the limit coverage, there are separate limits available for legal defense costs and court-awarded damages. So, the defense costs outside the limits don’t erode your policy limits available to pay settlements resulting from a suit.

This should not to be overlooked because if your company is facing a law suit, the type of coverage you’ve elected will be pivotal in determining your potential financial responsibility.