Consistency is key for brokers when completing insurance applications

Although a broker might not remember each and every insurance application he or she fills out, it is imperative for legal reasons that every application for insurance be filled out the same way, Stephen Scullion, director of professional development at Crawford & Company (Canada) Inc., said at the 2009 IBAO Convention in Toronto on Oct. 23.
A well-crafted completion of an application for insurance can spell failure or success in any claims situation — even E&O claims situations involving brokers themselves, Scallion said.
In Sholidis v. Economical Mutual Insurance Co., the plaintiff, Panagiotis Sholidis, suffered a fire loss. He was denied coverage and subsequently sued the insurer and the broker.
Sholidis claimed the broker was negligent when filling out the application form and had written down false information, Scullion said.
There is no way a broker is going to remember every application ever filled out, Scullion said. All the same, “if you did it 100 times the same way, the law will assume you did it the 101st time the same way,” Scullion said.
Keeping to an established routine helped the broker in Sholidis, Scullion said. The court held that the broker had followed his usual practice of asking all questions on the application form, and that Sholidis had given the answers recorded on the application.
“You do your due diligence, it is to your protection,” Scullion said. “The idea is if I do every one the same, give it the attention it needs, do what has to be done, I never have to worry about it.”