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...with only marginal vigilance, this real-life insolvency could have been 'predi...uating a carrier’s financial stability and minimizing the risk of an E&O c...

...lines” is a misnomer, because it’s really a list of the agency’s contractual b...omply with all applicable laws, rules, and regulations.

... . No warranties, express or implied, are made that the list is either a predictor or a guarantor of a company's financial condition. To illustrate the use of the Insolvency Checklist, please download this financial information excerpted from a 1983 A.M. Best report on a real carrier we'll call the Big Red Insurance Co. (to protect the innocent, guilty, and embarrassed) . Big Red was declared insolvent in 1985. The document presents seven categories of A. M. Best information as exhibits:General Information (Exhibit 1 ... there been any negative operating income or sustained underwriting losses during the past three to five years? Yes. Exhibit 5 indicates a significant deterioration of underwriting and bottom-line operating losses over the past five years. Has the company made any questionable investments (in affiliates, real estate, cash increases, low yields, etc.)? Yes. Using the yields and asset values from Exhibit 2, Big Red's return on investment was only about 2% . In addition, the cash component of the investment portfolio increased from 12.2% to ... that we're fixers rather than preventers. Although many articles have been published on insurer insolvency, most have been retrospective: here's what happened and why. This approach does little to fix the problem and even less to prevent its reoccurrence. This article will give you, the independent agent, a practical methodology to examine the ongoing financial stability of your carriers and to take corrective action as warranted. Although this approach can't prevent an insolvency, it can help minimize the likelihood that you and your clients will become active participants in the process. Legal ...

...er amount of coverage to obtain on real property, absent a special relationshi...ell as contract claims. Gilmer v. Intestate/Johnson Lane Corp. (1991) ___ U.S....