In the life of an independent agent, there is typically a lot of quote activity, on both a personal lines and commercial lines basis. A solid E&O best practices that has been promoted for many years involves getting the customer / prospect to sign off on those coverage’s not wanted. This is certainly easier to do if the agency personnel (producer / CSR) is physically meeting with the customer. What about situations where the quote is provided and the customer wants to "think about it"?
There have been many E&O claims where the customer / prospect has a loss and then alleges that they were under the belief that the coverage had been ordered. The key is to bring some type of closure to all open quotes. Take for example, your agency provides the customer with an auto, homeowners and umbrella proposal. The customer subsequently requests the auto and the homeowners but wants to think about the umbrella. This decision should be documented in the agency management system. It should also be memorialized in some type of written communication back to the customer confirming that the umbrella coverage has not been placed.
Some agencies have included in their proposal that the coverage offering is only valid for "x" number of days and then presume that if the coverage was not requested that the offering is "officially dead". This may sound like a viable plan but if a loss occurs, the customer could potentially allege that they were under the impression that they had requested the coverage. Thus it is best to have some type of written document that states that "the umbrella coverage has not been ordered. If this is contrary to your understanding, please advise the agency as soon as possible".
With Super Storm Sandy, there were E&O claims where flood coverage had been placed but allegedly on the wrong locations / properties. Thus, there may be situations where providing exact detail on locations insured / not insured is necessary.
Bottom line, as your agency provides quotes, be sure to have some type of diary / follow up to bring an "official closure" to those quotes. Without this closure, these "open" quotes could cause some potential E&O issues where it will be your word against the customer’s word. Those scenarios are definitely tough to predict.