Corte Madera, CA – What are the top five precursors to a client-filed claim? Terra Insurance Company knows, and you should, too, because – according to a new, free, five-minute video featuring Terra Vice President of Claims and Risk Management Lisa Gamblin, Esq. – there’s a lot you can do to prevent claims from being filed against you and your firm, provided you know what the precursors are. Ms. Gamblin knows what she’s talking about: Terra is the nation’s highest-rated professional liability insurance company.
“People can learn some genuinely important information in less than five minutes,” Ms. Gamblin said. “The precursors I address are what years of experience – and claims histories – have taught us. In many cases, the precursors suggest you should be proactive and speak with client representatives to inquire or explain at the first sign of a problem. In other cases, however, the best option may simply be to run – not walk – to the nearest exit. Declining work is difficult for some firms to do, however, because the economy is still weak and they need the business. Nonetheless, even for those firms, it is important to recognize and try to mitigate the risks from the outset of the project.”
Terra bases its claim to being the nation’s top-ranked professional liability insurer on its A.M. Best Capital Adequacy Ratio (BCAR) score. According to A. M. Best Company, the internationally respected insurance-company rating organization, BCAR is “an integrated evaluation of a company’s investment, credit and underwriting risk as it compares with the company’s level of economic surplus…. BCAR is an important tool in evaluating a company’s balance-sheet strength.” Best goes on to note that “a company with strong, stable operating performance, sound risk management, a strong business profile, high-quality capital and strong financial flexibility, on a historical and prospective basis” needs to have a BCAR score of at least 175 to receive an actual or implied top rating of “A++, Superior.” Terra’s BCAR score of 619 is 3.5 times the minimum and is believed to be one of the highest of all insurers nationwide.
Ms. Gamblin described as uninformed and short-sighted the belief that the larger a professional liability insurer is, the more secure its insureds and their claimants are. “The fact is that size alone has nothing to do with security,” she commented. “When a company’s assets – no matter how substantial – are less than its liabilities, the company’s in trouble. If it happened to AIG, it can happen to other insurers. And it has.”
Established in 1968, Terra became a risk-retention group two decades later, taking advantage of a then-newly enacted law permitting such companies to operate in all U.S. states and territories at a comparatively low cost, providing they are 100% owned by their insureds, all of whom must have certain business interests in common. In Terra’s case, its owner/insureds are independent firms whose practices involve geotechnical and civil engineering, the environmental sciences, construction-materials engineering and testing, and other geoprofessional services. Terra furnishes them with an array of professional liability, environmental liability, and design/build coverages. Their gross revenues range to more than $100 million annually.
More information about Terra and the products it offers, as well as other free videos and risk-management publications, can be found at www.terrarrg.com, or by contacting Terra Insurance Company, 2 Fifer Avenue/Suite 100, Corte Madera, CA 94925; tel. 1/800-872-0077 (in CA, 415/927-2901); e-mail terra@terrarrg.com.