The lower risk you are to an insurance carrier, the better your chances at getting a low premium rate. Insurance companies evaluate risk levels of potential and existing clients based on how many claims they have had within a certain amount of time, how much those claims cost the insurance company and other factors that are appropriate to the type of insurance being provided. For instance, auto insurance looks at claims history, but also academic grades, credit scores and other factors to determine risk levels of potential clients. They may also offer premium discounts for drivers who opt to take a defensive driving course. As with any type of insurance, the fewer claims you have against your E&O policy, the better your chances of getting a lower premium rate. The more money that has been paid out in your behalf by an E&O insurance policy, the higher risk you are to an E&O coverage provider. If individuals are high risk, an insurance company may not be willing to insure them, or at the very least, give that client a high premium in order to compensate for predicted losses incurred by that individual or company.
If you are looking for lower E&O insurance premium rates, it may be worth searching for a company that gives discounts for participation in and compliance to risk management programs. Arbitration agreements between customers and professionals within the financial field may also work to reduce premium rates. Visit the Axis website for more information.