Which statement best describes Agent or Broker of Record Letter handling?

• A. Request only when needed and ensure understanding
• B. Always request ROE
• C. Never request ROE
• D. Only request when premiums are high

Answer: (A)

The key idea is that a broker/agent of record letter should be used only when there’s a real need to change or establish who will represent the insured and handle the policies. This letter gives authority to the named broker to service the account, request changes, bind coverage, and receive commissions for the policies it covers. Because it changes who isauthorized to act on the insured’s behalf, you want to use it thoughtfully and with clear understanding by all parties.

So, the best approach is to request the ROE only when there’s a genuine need—such as when a new broker or agency will be taking over the account, or when the insured explicitly wants to switch representation—and to ensure the insured understands exactly what the ROE covers, including which policies are affected, the effective date, and the broker’s duties (servicing, endorsements, claims handling, and commissions). This keeps the relationship clear and avoids unnecessary changes or confusion.

ROE timing isn’t about premium levels, so it wouldn’t make sense to base it on high or low premiums, and it isn’t something you would push universally for every policy.