Our RAC members had a spirited round of discussions about E & O insurance that covers prior work. Their names were redacted to protect the innocent (kidding). Here are some of the ideas and themes that came up:
When shopping for a new policy, the biggest concern an appraiser is whether prior work is covered. Every carrier is different and this is clearly something to ask for. Here are some comments from RAC members:
When you retire you need to acquire what is called “tail coverage” to allow continuous coverage that may be brought after your business has ceased. I would question your provider when changing policies to find out who will represent you for past work completed prior to changing insurance providers.
The problem with changing e/o providers is that the new provider may not warrant your historical appraisals. When retiring you may need to consider a policy that covers you for the past several years as well.
You (may) need to keep copies of ALL of your policies as the claim is against the policy in place at the time the report was prepared.
A few thoughts about picking an E & O carrier (RAC doesn’t endorse specific companies):
I think [firm name] is great. You can get them on the phone and ask them questions and they are happy to provide an opinion at no charge. In my area they have offered free seminars with CE credit. The premium has stayed the same for years. If I ever have a problem, I believe they will defend me. In contrast, I think some other companies might just pay out and cancel my policy.
If you have a claim you are dealing with the carrier directly. In our experience the carrier is far more important than the agency.
(I) know that they dedicate resources specifically to the appraisal industry.