Slideshow 7 tips to not get sued

  • May 14 2014, 5:07pm EDT
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1. Hit the target

Make sure you are capable of delivering the services the client demands. "Your clients expect you to be the most knowledgeable and up-to-date trained professional," says David Lo Verso, vice president of underwriting for accountants’ and wealth advisers’ professional liability insurance at Jorgensen & Co. "So stay on top of licensing requirements and the ever-changing revisions to state laws and statutes."
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2. Beware of increased audits

The U.S. Department of Labor has increased its auditors in the field. Make sure you conduct internal audits for health plans and wage and hours so that your clients feel prepared should an auditor knock on their door, says Craig Davidson, broker coach, founder of Davidson Marketing Group and EBA columnist. If you don’t prepare them, they may be subject to penalties and turn to you with a lawsuit at the end.
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3. Don't speak too quickly

Avoid giving out spontaneous advice on all benefit matters, but especially the Affordable Care Act. "It's easy to … rush through a client's question," Lo Verso suggests. "If you find yourself giving quick information, document it after the fact — of what you conveyed to the client to avoid any confusion between the client and yourself."
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4. Check your E&O fine print

With more auditors in the field by various government agencies, it’s time to make sure you know the exact language of your policy. "Look at your E&O and see what it covers," says Jessica Waltman, senior vice president of government affairs at the National Association of Health Underwriters.

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5. Know your clients

Exercise due diligence with prospective clients before committing to them. Make sure they don’t have any pending lawsuits and understand their full business model and plan. Also, make sure you know about any other businesses they own, as controlled groups now factor into the employee count with the ACA. “If advisers put [employers] in an improper structure that triggers some adverse consequences, there could be a potential malpractice claim,” says Keith Mong, a partner and employee benefits attorney at Venable LLP in Washington.
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6. Keep an eye on your independence

Don't let your judgment get clouded when performing services. "If you take on clients that happen to be friends outside of your professional relationship, do not allow yourself to succumb to the problems that come along with this," Lo Verso explains. "Having a healthy separation of church and state will help you avoid actions that might suggest you are anything but independent from your client."
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7. Don't rush in

When it comes to new areas of practice, make sure you know what you're doing. "Declaring yourself an expert in a particular field of practice is risky, so always make sure you are qualified in what you are doing,” Lo Verso says.
[Image: Accounting Today]