News

Some people wish they were great golfers, but I wish I was a great reader. Not that I couldn’t stand to improve my golf game, but I just don’t think being a scratch golfer would make me a better person. On the other hand, books take me places and open up worlds and ideas that I may never see or come across any other way. I like books – I just don’t like to read all that much. I do manage to get in a few novels every year; Grisham, DeMille and the like. I also mix in a few management & business books like Good to Great by Jim Collins and The Serving Leader by Ken Blanchard. 

I love to be inspired by a good read or challenged by a new idea. It was Abraham Lincoln who said “Books serve to show a man that those original thoughts of his aren't very new at all.” Today, I need to share something with you that isn’t new, but does have an impact on an important decision and course of action that Tuscano will follow going forward.

As insurance professionals we all know that a carrier can’t just decide that they no longer want to insure a particular risk. Rules dictate when, under what circumstances, and how a carrier can separate themselves from an insurance contract. We all understand the rules that govern typical cancellation scenarios. In the case of a nonrenewal, we see similar reasons as well as when there are substantial changes at renewal in a carrier’s coverage, rates, or forms.

There is however, another reason for non-renewing – to provide certainty of coverage termination. In Pennsylvania specifically, the statute states, “Until an insurer issues a nonrenewal or cancellation notice that complies with the provisions set forth in this act, insurance coverage will remain in effect. “ (40 P.S. & 3403(2012) NOTICE REQUIREMENTS OF PROPERTY AND CASUALTY INSURERS) 

Over the years, you may have seen your standard contract carriers address this in a different manner by going to direct bill. They are able to cancel the renewal for non-payment of premium if the insured does not take it. This procedure gives your companies a certainty that a policy has terminated. We are unable to direct bill your business. We also recognize that automatically renewing your policies, many of which contain minimum earned premium provisions, would be difficult to manage. This non-renewal to coincide with expiration provides the same certainty of termination of coverage.

After much wrangling and debate (and a good deal of kicking and screaming) Tuscano has come to the conclusion that where the company has transferred notification obligations to us as their agent, Tuscano has a contractual obligation to notify the policyholder directly that their policy will ‘Non-Renew’ when it expires. The alternative to sending the notice is to open our carriers to a potential automatic continuation of coverage and ourselves to a whopper of an E&O loss.

The bottom line is that Tuscano will be sending Non-Renewal notices on a majority of our business. Where we are not the carrier’s appointed representative, we will not be sending the notice – that is for someone else to manage. We should be getting this in place within the next few weeks, so you will start to see the notices on November expirations and later.

We do not want to disrupt your business or in any way imply that we do not want to renew all of our policies. Our goal is not to scare policyholders into shopping their business. Aside from the notice, we will continue to treat renewals the same way we have always done. Your business is important to us and we do want to retain it by giving you and your client the very best in professional service. 

Thanks for your business – now and at renewal.