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January 13, 2015

E&O insurance: where do I get it & how much do I get?

Everybody is getting E&O insurance these days. Ironically, the only notaries who I have heard about having claims on their policies are the ones who went overboard and got a million dollars of coverage just for show which turned them into a target. But, on a brighter note, you need E&O in order to get hired. Yes, it is more of a fashion show than something you actually need, but the fact that signing companies don’t take you seriously if you don’t have it makes it a necessity. The question is — how much & who do you get it from?

Lots of vendors sell E&O insurance.
Notary Rotary sells it. NNA offers one stop shopping for notaries including E&O. One notary claims that Merchant Bonding offers the best rate on E&O. One notary said that Traveler’s charged him only $170 for 100K for four years which is excellent as others charged $265 for the same coverage. It seems that companies that cater exclusively to notaries do not always have the best rates on insurance, although the convenience of one stop shopping makes it worth while to pay a little more.

How much should you get?
The quantity of your E&O depends on who you are trying to impress. If you just do signings for signing companies, perhaps 25K is enough. If you are full-time and want to appear professional, it is better to have 100K rather than claiming in your notes section to be professional. Don’t say it — show it! If you want to work on the white glove list for major Title companies, then 500K or a million might be in order. I don’t know what that costs, but if you are getting paid big bucks regularly, then whatever they charge is probably worth it.

If you want to comment on this blog entry: let us know where you buy your E&O and what it costs!

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Help, I’m being sued, and E&O won’t help!
http://blog.123notary.com/?p=3570

Hold Harmless Agreements: good idea or not?
http://blog.123notary.com/?p=3657

How to get paid by out of biz signing companies
http://blog.123notary.com/?p=8646

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April 30, 2013

Help, I’m being sued, and E&O won’t help

Dinner was over and it was actually time to call it a day and get some rest when there was a doorbell. The family could not help wonder who inthe world this could be this late in the evening. It was approaching 10:00PM for god’s sake. The lady of the house went to the door and the gentleman standing on her porch asked if she was the Mrs. Xyz and she responded yes and then he proceeded to hand her an envelope. He stated; “You have been served”.

She shut the door curious but at this point not to worried.…she was thinking ‘oh this must be a request for testimony or something of this nature’ but as she began to read the documents to her shock and disbelief….she was being sued!. She was devastated to say the least.

It seems that back a few months she had done a modification and something had gone VERY wrong and now the person who’s signature she had notarized had hired an attorney and he as suing everybody that had been involved in his transaction including the notary. This particular client was claiming that there was intent to commit fraud with all the parties that had been involved with his loan modification. The notary contacted her bonding company and they looked over her evidence and found that she was in the clear. She had done nothing notarially wrong therefore they could be of no use. But what makes it worse is that they refused to represent her. It was basically out of their hands. For those of you that don’t know. Errors and omissions is just for notarial mistakes. It will not benefit you any other way. As in the case of this particular notary she was being included in a fraud case so now she was forced to figure out how she was going to defend herself.

She and her husband discussed it and he felt that she would need to hire an attorney and so that is what they did. But unfortunately they found out that it was not going to be cheap. The attorney kindly informed them that it would be about 30,000 when they were finished. Now as I listened to the story I was in shock. I thought that if that were me in this situation I would just be forced to take a different route. I would have to have to represent myself. I would not be able to afford this large sum of money at all. Personally, I would have made a copy of all work orders and correspondence of the hiring parties along with a copy on my journal entries and a signed and notarized affidavit that I did not know any of the parties involved and would have sent this to all the attorneys involved and hoped for the best. In my years as a notary I have a couple of signers on a couple of occasions that were suing the parties that hired me and this is what I have done and it seemed to suffice and I have never had to attend a court trial. Thank the man upstairs!

It might be naive of me but if you know that you didn’t do anything wrong I don’t feel that you need to spend exorbitant amounts of money to prove it…and if you don’t have it and cant get it then you are forced to defend yourself anyway. It is actually disheartening that we have to be drawn into other peoples drama….Which led to me into thinking that we should have some sort of release of liability document for folks to sign when we notarize their signature. The document should state many things for example,; one, that we are verifying identity and signature only on the document, that we did not have anything to do with the preparation of their document, that we do not know them or are we involved in their transaction in any way. Now, I don’t know if this would protect us totally from any lawsuits but I sure would feel a whole lot better having them signing it. And if unfortunately there was a lawsuit maybe it would offer some sort of protection. It would seem to me that in the situation our notary in the story finds herself if she had such document she would less likely NOT be involved in that lawsuit. I look forward to hearing what some of our attorneys her at 123 have to say about this and would love some input as to exactly what the letter affidavit should say.

I am very interested in what others have to say on this subject. I feel for this notary. The bad news is that she is seriously contemplating giving up her commission and her notary business all together. She has been a notary for over a decade and this ordeal has left a bitter taste in her mouth and I do understand. She and I talked for a very long time and she told me that I made her feel better and that at this point she didn’t feel as alone as she had been feeling. I was glad to be able to do at least that much for her. I wish it could have been more. Let me know what you think!

Until next time…be safe!

Tweets:
(1) The borrower had hired an Attorney to sue everyone who had been involved in the modification including the notary!
(2) It would cost $30,000 for the notary’s Attorney fees to defend her from a crime she never committed!
(3) E&O refused to cover the notary since she didn’t make an error or an omission. It was the Lender’s fault!

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Protect yourself with a contract
http://blog.123notary.com/?p=2593

Hold harmless agreements: Good idea or not?
http://blog.123notary.com/?p=3657

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