Are you an advocate for your client?

CASE NO 1

At last renewal your firm carried out an instruction by a client, a commercial property owner, to reduce the sum insured on an unoccupied commercial property from £850,000 to £650,000 because you were told the property is no longer worth as much. Eight months later a fire destroyed the property and it is found to be under insured by more than £350,000.

Should you:

  1. Write back to the client reminding them that you were instructed to reduce the Sum Insured and that any under insurance is at their risk.                                                                               
    YES/ NO

    The answer is NO - Do Not write back to the client reminding them that you were instructed to reduce the Sum Insured and that any under insurance is at their risk. This would be likely to escalate the matter to immediate legal action and so prejudice your position before either party is in possession of the full facts.
  2. Pass the letter to the insurer and ask them to deal direct with the Insured.

    YES/ NO

    The answer is NO - Do not pass the letter to the Insurer because you are the agent of the client and are being asked for your advice  
  3. Negotiate with the insurer to increase the offer of settlement.

    YES/ NO

    The answer is NO - Do not negotiate with the insurer because you are not yet in possession of all the relevant information.
  4. Contact the Loss Adjuster to question the offer of settlement.

    YES/ NO

    The answer is NODo not contact the Loss Adjuster. It has no duty of care to you and you might prejudice your own and your client's legal position.
  5. Write to the client acknowledging their complaint but without admission of responsibility, ask for them to provide information that supports the value of the property at last renewal, upon which their instructions were based.

    YES/ NO

    The answer is yesand this would be the first thing to do - write to the client acknowledging the complaint but without admission of responsibility, ask for them to provide information that supports the value of the property at last renewal, upon which their instructions were based.