Encourages other states to follow New York’s lead

The Risk and Insurance Management Society (RIMS) commended New York State Insurance Department Superintendent Eric Dinallo for asserting a strict policy on contract certainty.

Superintendent Dinallo said that within the next year 90 % of cases should achieve contract certainty within 30 days of inception.

Contract certainty is an issue at the heart of customer service deficiencies on the part of brokers and insurers, according to RIMS.

RIMS said it was grateful to Dinallo for taking the necessary steps to tackle the issue and hoped that providers would work speedily and aggressively to comply.

RIMS also said it was eager to learn how the New York Insurance Department intended to measure compliance and what penalties non-compliant companies could face.

The society expected that other state insurance offices would follow the initiative or providers themselves would take steps to lead the process internally. It said that it would offer guidance to those service providers seeking the buyer perspective as they are developing measures for meeting contract certainty requirements.

RIMS also urged the creation of an evaluation program whereby clients would provide feedback on whether providers meet, exceed or fall short of the expectations.

A history on contract certainty

For many years, risk professionals have voiced increasing concerns about the lack of responsiveness and quality of services offered by insurance providers. This prompted RIMS, in 2005, to develop a Quality Program to improve the service and delivery of insurance-related products to buyers.

Contract certainty is a core part of RIMS Quality Program. Among the tools developed to aid risk managers in the process are the Quality Guidelines for Performance Expectations principles that focus on the main aspects of effective relationship-and insurance program-management. RIMS also launched a Quality Forum, an annual meeting convening risk practitioners and CEOs and other top executives from the largest brokers and insurers, to discuss quality improvement in the insurance placement process. Contract certainly has been at the forefront of the Forum's agenda for the past three years. The dialogue proved to advance providers understanding of the issue from the buyer's perspective and even, in some cases, has allowed some companies to develop internal programs to expedite the insurance placement process. Currently, RIMS Quality Guidelines are being updated to a format that can be customized to each user's needs.

Topics