Sally Bracho, who has been with ABD since its founding, is our Property & Casualty practice’s resident contract specialist. As SVP of Claims and Contracts, Sally manages contract review for our clients – a task that grows more complex as risk itself grows more complex. She often looks at this process as helping her clients find “peace of mind,” but to understand why this service is such a valuable part of ABD’s commitment to our clients, we had Sally give us the basics of contract review.
So, what exactly is contract review?
Most insurance brokers offer some form of contract review because insurance plays a huge role in contractual risk transfer between a company and their customers, contractors, vendors and partners. Reviewing these contracts ensures that potential losses are covered to the greatest extent possible, so brokers typically review the contract requirements and adjust clients’ policies to satisfy the policy and limits requirements.
For many firms, this can be a cursory process. Brokers may just look at the policy and limits requirements and adjust accordingly. But contracts can be poorly written, difficult to decipher, and legally vague. In addition, the contract may require an extensive set of policy terms and conditions, some of which may be impossible to satisfy. A skilled contract review team will need to understand the legal implications in order to explain the insurance implications.
What does ABD do differently?
Sally’s role was born out of the need for deeper expertise to serve our technology clients, as the risks they face are increasingly complex and unique. Many firms don’t have specialists with both legal and insurance backgrounds, so Sally’s dual expertise is an invaluable resource to our P&C team at ABD.
This expertise allows our claims team and clients to understand how insurance will work in the event of a loss and how indemnities and liabilities outlined in the contract interplay with insurance clauses – key to finding policies that best fit the needs of our clients and helping them understand the risk exposures arising from their contracts.
Sally also utilizes creative tools to help our clients understand the insurance implications of their contracts by developing contract playbooks for our clients. These playbooks outline standard provisions, policies, and limits and offer advice to help our clients negotiate the best possible insurance language for their contracts.
Training legal and procurement teams on the insurance language they are likely to encounter in contracts is a major part of helping our clients create effective risk management programs.
We do not and it is never our intent to give legal advice; our goal is to provide our clients with the tools and resources to better understand the risks assumed in their contracts, how these risks fit within their risk tolerance, and how insurance programs work to transfer those risks.
About the Author:
Sally Bracho is the Senior Vice President and Claims & Contracts Specialist for the ABD Team. She brings nearly 40 years of experience to the insurance industry in P&C claims and contract management. Sally began her insurance career as a liability adjuster with various carriers and eventually as a liability claims manager for an independent adjuster firm. Prior to joining the ABD Team, Sally was with an Insurance Services Contract Specialist for Wells Fargo Insurance.