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Source of Title Blog

Do Your Abstractors Have E&O Coverage?
by Robert Franco | 2007/01/22 |

How do you know if your abstractors are carrying the proper errors and omissions coverage? As was reported at the NALTEA conference in San Diego, some abstractors seem to be working the system and scamming insurers and their clients.

It works like this: an abstractor applies for E&O insurance and opts to finance the premium. They get their certificate that shows coverage and then they make no further payments, and the policy is cancelled. Even though the coverage no longer exists, the abstractor still has the certificate to fax to potential clients who require it.

So, again I ask, do your abstractors have E&O coverage? Short of making random calls to the insurer shown on the certificate, how do you really know?

Well, you can look at the retroactive coverage date. If they have maintained coverage for many years, it is less likely they would risk the prior coverage by letting the policy lapse.

But I would also suggest getting know your abstractors (if you don't already). Look for experienced, professional abstractors with a reputation for honesty and integrity. Your abstractor should be someone you can trust and upon whom you can depend.

Robert A. Franco
SOURCE OF TITLE
rfranco@sourceoftitle.com

Source of Title Blog ::




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Categories: Abstractors, E&O Insurance

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Abstractors E&O Insurance

As a title agent you should get a Certificate of Insurance (not just a Declarations Page) . This should be a matter of business process.  As a Certificate Holder the insurance agent should "endeavor" to notify the Certificate Holder if the insurance is cancelled.  One problem is that Errors and Omissions Insurance Policies are written on a claims made basis and therefore even if they do have insurance this year they may not in the future.  Many title agents have contracts with their abstractors which specifically spell out the insurance requirements and will also state that they must keep the insurance inforce for a specified number of years after the contract ends or purchase an extended reporting endrosement .

I hope this helps

MIke Smith

Axis Insurance Services LLC

www.axisins.com

 
by Mike Smith | 2010/03/29 | log in or register to post a reply
Source of Title Blog

Robert A. FrancoThe focus of this blog will be on sharing my thoughts and concerns related to the small title agents and abstractors. The industry has changed dramatically over the past ten years and I believe that we are just seeing the beginning. As the evolution continues, what will become of the many small independent title professionals who have long been the cornerstone of the industry?

Robert A. Franco
SOURCE OF TITLE

 

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