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Behind the Curtain: A Conversation with an Insurance Underwriter

May 16, 2022

Did you ever wonder why your insurance broker asks—or should be asking—for so much information during the policy purchase process? It’s not that we’re nosy or want to make you jump through hoops. It’s because the more information you share and the more proactive you are, the more we can build a relationship that saves you money.

Insurance rates have been steadily rising over the last several years for a variety of reasons. When you take macroeconomics out of the equation, though, the businesses earning the most favorable premiums are those who are willing to share quality information, take some loss control measures, and improve the overall quality of their organizations.

Telling Your Story

Insurance underwriters have told us that receiving quality information is key to understanding your exposures. They need to have a strong sense of where your business is now and where it will be in the future. When organizations are open to dialogue about their history of process improvement, underwriters develop a greater comfort level. Just like you, they benefit when your business is positioned for long-term success.

Your broker is important in representing your story to the carrier. Beyond reviewing data, your broker’s impression can be influenced by things you might not think much about—like an outdated website or combustible materials stored next to a building. These neglected details send a message that your business might not be highly proactive.

Your Broker’s Loss Control Team: A Bridge Between You and Your Underwriter

During a plant tour, a broker’s loss control team pays attention to how you answer their questions. If you’re ready with sure, detailed responses, the loss control team senses a willingness to take risk management seriously. When a business owner responds to a question with “I’m pretty sure we do that,” the opposite impression is forged.

Loss mitigation is most favorable when it includes risk self-identification. Talk to your loss control team so they understand your challenges.

Sometimes a broker’s loss exposure mitigation recommendation may seem too expensive or disruptive. Rather than doing nothing, the business owner who considers taking the recommended measures in phases shows an openness to finding a manageable solution that can be gradually implemented. Although the return on your risk mitigation investment may be difficult to calculate upfront, the long-term benefits of proactively reducing your risk are certain. If you take no action, on the other hand, failure to pay for the gap in protection will cost your business far into the future, and possibly not only in higher insurance premiums.

Some businesses take proactiveness to an even greater level by involving their brokers and underwriters before new construction. These savvy organizations know that building to code (life safety) isn’t the same as preserving your loss or reducing your business interruption. When brokers and underwriters are brought in at the design phase, an organization can get ahead of potential issues. Many underwriters agree that true change management happens when they’re given a seat at the table and have input into lowering risks that can result in reduced rates and a favorable ROI over time. The easiest way to “get it right” is to build it right.

This approach indicates a desire to partner with your broker and underwriter and strengthens the relationship that’s critical to earning you more desirable insurance rates. 

Even if structures are already in place, you can get closer to an ideal submission by identifying protection that meets National Fire Protection Association (NFPA) and carrier requirements. For instance, risk can be lowered at no cost simply by reducing the number of combustible materials on hand. Your broker can offer creative solutions that may change your risk profile over time. Current mistakes are future opportunities when businesses take advantage of the resources available through a partner relationship with their brokers.

What Makes Your Insurance Submission Less Desirable?

Understandably, organizations that don’t take their broker’s risk mitigation recommendations or take steps in that direction have put themselves behind the eight ball from a carrier’s perspective. They don’t appear to see risk management as a priority and are frequently scrambling at the last minute. Without 90-120 days of lead time, insurance renewals are rarely optimal.

A high frequency or severity of claims is sure to raise the carrier’s eyebrows, but having some claims shouldn’t be significantly detrimental. A carrier’s business is making its clients whole. Claims aren’t the end of the story when they call attention to improvement opportunities. A broker can help identify where the losses are coming from and offer suggestions to lessen those pain points. The goal is always to help your business stay in constant uninterrupted operation.

What Makes Your Insurance Submission Most Desirable?

In the end, it’s the relationship you build with your broker and underwriter that benefits you most. When you’ve built a history of mutual trust that includes transparency and the sharing of complete, accurate information, your submission is going to move closer to the top of the stack.

Envision yourself in the insurance process driver’s seat. Seeing yourself as a valued part of the process upfront will result in positive benefits to your bottom line.

Get to know your broker and underwriter because they’re looking to help you move your business forward. The stronger your relationships, the better the results will be for everyone.

For more information, please contact me directly or learn more on our Property & Casualty page.

Steve Carey
Risk Strategist, Property & Casualty


Note: This communication is for informational purposes only. Although every reasonable effort is made to present current and accurate information, Oswald makes no guarantees of any kind and cannot be held liable for any outdated or incorrect information. View our communications policy.