Now, some captains have a greater grasp of insurance issues than others- granted; but on Friday last a captain called me to discuss a basic insurance issue. He didn’t fully grasp the concept and kept asking questions that did not apply to his owner’s situation or scenario. I asked him if he’d like me to discuss this with his owner via a conference call and he said, “No – I’m shopping the insurance. I don’t want to bother the owner with this silly stuff.”
“Silly stuff.” Hmmm…
The ONE thing the owner has that puts its money where its mouth is. The ONE thing that, if done correctly, will pull an owner’s financial butt out of the fire faster than any captain. The ONE thing that, if done wrong, a captain can walk away from leaving the owner to pay the tab.
Folks, insurance is not “silly stuff” and it certainly should not be attended to by anyone not qualified to do so or by anyone who thinks it’s “silly stuff.”
There are a number of reasons why unqualified people should not step outside their area of expertise, but I’ll leave the common sense arguments alone and focus on the legal aspect.
Florida statutes state that unless you are licensed insurance agent it is unlawful to engage in insurance activities:
69B-222.060 Unlawful Activities by Unlicensed Insurance Personnel
The following actions are never allowable by unlicensed personnel.
(1) Comparing insurance products; advising as to insurance needs or insurance matters; or interpreting policies or coverages.
Note the phrase “never allowable.” Not a whole lot of grey area there.
There is a reason for this. It is because insurance professionals know insurance and understand the ramifications of an improperly structured insurance policy. We know the financial consequences of coverage gaps or coverage exclusions. We know how to explain the product and (in some cases) we have the authority to make statements and assertions on behalf of an insurer.
And think about this: A unlicensed captain behind the wheel of an insurance policy is just as financially dangerous as an unlicensed insurance agent behind the wheel of a yacht. And when things go wrong it’s the owner who is screwed. Insurance professionals get this – captains may not.
Captains should not counsel owners on insurance, make insurance determinations, base insurance decisions on cost, negotiate insurance contracts, negotiate any contract with insurance conditions, etc… It’s outside their area of expertise no matter how many times they tell you, “I’ve been doing this for years,” because I’ll tell you all one thing right now: Dedicated insurance professionals have forgotten more insurance than most captains will ever know.
I’ve said it before and I’ll say it again: do what’s right by your owners and ALWAYS refer them to a qualified insurance professional. And if a captain is spouting off insurance information ask him/her to produce an insurance license, E&O insurance and confirmation of a selling agreement with an agency or insurance company. Otherwise, kindly thank him/her and get your insurance counsel from someone qualified to provide it.