| This scenario represents an actual coverage flaw in an insurance program of a well run, profitable business.
A prospect’s auto policy included a standard exclusion for claims made by one employee against another employee. The following claims scenario was troublesome to the CEO and CFO:
- CEO drives employee to a key client’s office for a meeting.
- CEO drives with a vehicle registered in the company's name. An auto accident occurs
and the employee is seriously injured while in the passengers seat. Employee sues
the CEO individually for his negligent driving.CFO reports the claim / lawsuit to
the insurance carrier.
- Carrier refuses to cover the claim based on the following paragraph in the commercial auto policy.
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Problem
CFO had to tell the CEO that there is no coverage and that his personal assets are at stake
because their insurance broker did not negotiate a commonly available enhancement to an
auto policy for a company of their size.
Solution
Hire a insurance professional that has a proven system that makes sure that every detail
of the policy is reviewed and negotiated to meet the needs and concerns of the management
team. This would not have been a concern if the broker remembered to ask the carrier to
modify the policy to include fellow employee coverage for Executive Officers, Supervisors
and other Key Employees.
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