Just got my renewal notice from my E&O carrier and they're bumping me up to $4,800/year for $1M coverage. I've been with them for three years with zero claims. Anyone else seeing rate increases like this? I'm starting to think I need to shop around. The market seems to be getting tighter for utility auditors specifically.
E&O Coverage - What are you guys paying annually?
Terry, that seems high to me. I'm paying $3,200 annually through AAUBA's group policy for the same coverage. Have you looked into the association's program? The rates are pretty competitive and they understand our specific risks. Plus they have experience with utility audit claims which some carriers don't.
I'm with Marcus on this one. The group policy makes sense especially if you're doing larger commercial accounts. I had a close call last year when Ameren Missouri questioned my demand calculation on a Schedule LGS audit - saved me about $45K in potential exposure. The E&O carrier handled it professionally and knew exactly what we do.
What's the deductible on the group policy? My current carrier wants $2,500 deductible and I'm wondering if that's standard. Also, does anyone know if the group policy covers subcontractor work? I occasionally bring in specialists for power quality analysis.
Sarah, the group policy has a $1,000 deductible which is pretty reasonable. As for subcontractors, you need to make sure they're listed and have their own coverage too. I learned that the hard way when AEP Texas questioned some power factor work my subcontractor did. Thankfully it didn't become a claim but it was a wake-up call.
Thanks for the input everyone. I'm definitely going to get a quote from the AAUBA group policy. Vivian, that's exactly the kind of scenario I worry about - power factor corrections can get expensive fast if there's an error. Better to have proper coverage than try to save a few hundred on premiums.
One thing to watch for is the 'prior acts' coverage date. Make sure any new policy covers work you've done in previous years. I switched carriers in 2012 and had to negotiate to get coverage back to 2010 when I started my practice. Claims can surface years after the original audit.
Sylvia makes an excellent point. I've seen claims come up 3-4 years after the original audit when utilities do internal reviews or rate case preparations. The statute of limitations varies by state but you want that tail coverage. Worth paying extra for peace of mind, especially if you're doing Tennessee Valley Authority work - they're thorough in their record keeping.