Our PAR-insured had a new agent/ producer on staff who had written a homeowners policy for a client while at his previous firm. When the renewal date on the policy came due, the prior agency forwarded the renewal quote, which had been brokered through a wholesaler, to the producer.

Because the of the broker’s involvement, the homeowners coverage could not be bound until it was formally accepted. This didn’t happen because the producer dropped the ball.

As often occurs, the mistake went undetected until it was too late. The client suffered a serious water damage loss while she was away at her winter home and subsequently discovered that the policy had never been renewed. Although the producer claimed he asked a former employee at the PAR agency to handle the renewal, there was no documentation of such a request.

With the PAR firm’s liability clearly evident, over $100,000 was paid to restore the house and its contents to pre-loss condition. Although the producer’s move to the PAR insured firm may have complicated the issue, the mistake here is still a basic one -- not obtaining a renewal for an existing client.