By Keri Herlong, CPCU, CIC, CRM, CISR, ACSR, AIM, CIIP, CLP-A, DAE, CRIS
In this market being an underwriter often feels like drowning in a sea of submissions with more raining down every time your inbox dings. Underwriters must wish they had a crystal ball to determine which of the 75 submissions in their work queue should be worked on first.
As agents’ workloads increase because of carriers taking rate, reducing coverage and/or capacity, laying off staff, or exiting lines or states completely, underwriters’ workloads increase just as much. Some carriers are delaying providing renewal options, or notification of non-renewal, which decreases lead time.
Requiring 90 (or 60, or 30) days of lead time is no longer feasible in many cases, so what’s an ambitious and service-conscious underwriter to do when they have too many submissions for the number of hours in the workday?
Prioritize.
Underwriters who work with independent agents cannot expect agents to know every nuance of each company’s underwriting guidelines. You know our own, so you know what will be a “yes”, what will be a “maybe”, and what is a “heck no”. So, use your guidelines to do a quick review of each submission to see where it falls on the opportunity scale.
First – what’s the REAL effective date and do you have time? If today is July 1, and the effective date is July 5 and it’s a $100,000 account with high property values and a large fleet of vehicles, even though you want to help, you probably don’t have time to do a good job. Rushing will only lead to mistakes.
Many underwriters are superheroes who want to say yes! However, you must be conscientious to say “yes” to those things you can actually DO. Saying “no” to something that you cannot (or do not have time to) do well frees you up to say “yes” to something else that deserves your time.
It goes without saying that you should ask, “Have I seen this submission in the past”? Most agents submit the same accounts year after year. If you declined last year, why? Does that reason still apply? If so, log the no and move on. Agents appreciate a quick “no” over a slow maybe that eventually turns to a no.
The next step is the class of business and what lines of coverage may be eligible. You only need to confirm the class is eligible in this step, not completely underwrite it. In this market, it doesn’t make sense to work hard on “no” and “maybe” submissions. Focus on finding a YES! using these points:
Property is driving submission increases countrywide. Start with that line.
- Limits
- Do you have in-house capacity/authority?
- If no, do you have time to get reinsurance? If no, decline.
- Is a pre-inspection required?
- If yes, do you have enough time to get that completed?
- If no, has a prior inspection been done within a reasonable time that you could use? If no, decline.
- Does the application include basic rating details: construction type, occupancy, number of stories, square footage? If no, decline.
- Do you have in-house capacity/authority?
The next line that may take more time to underwrite due to complexity and premium size is auto. Auto rates have been increasing for several years along with auto claims and nuclear verdicts. Closely underwriting this line is critical for profitability. Depending on the amount of time you have for underwriting and research, each of these criteria could be important to determining if this is an account you can consider.
- Number of vehicles
- Age of vehicles
- Type of vehicles (i.e., PPVs, light trucks, dump trucks, truck-tractors, etc.)
- Does the application include basic rating details: limits, year, make, model, VIN, garaging zip, radius, use, coverage selection?
- Complete driver list
Based on your company guidelines, does this submission fit for minimum/maximum vehicles, premium or class that requires pre-inspection, eligible equipment (i.e., if your guidelines prohibit vehicles over 25 years old and that is the majority of their fleet). Eyeball the driver list to confirm driver ages that meet your guidelines.
Summary
Prequalify using these basic steps:
- Effective date far enough in the future to allow time to underwrite the exposures appropriately
- Have you declined previously and does that reason still apply?
- Is the class of business eligible?
- Quick review of property limits, requirement of inspection, rating information
- Quick review of auto for basic rating details, vehicle information, and acceptable drivers
Depending on the size of the account, this process should take you about five minutes. Once your submission has been prequalified, you should feel confident the account is a true opportunity. You may find something during underwriting that makes it ineligible, but at least with this prequalification process, you can identify the best opportunities early on so you can focus on what you do best – quoting and binding profitable business for your company.
It may help to create a checklist or template. If you’re old school, print it out and check those boxes. You can also create this in Excel or Word and highlight or strike through or check virtual boxes as you do your prequalification review. You could even share this with your agents to help them ensure they are giving you at least this information in their cover email or as part of the submission. While it may be a little extra work for them, the result is a more efficient underwriting process for you both. As a bonus, the most professional agents’ submissions will already have these details.
Keri Herlong is a Commercial Underwriting Consultant for Acuity and has been in the insurance industry for 30 years. She has been a member of IAIP for over ten years and is a Nevada Member at Large. She has served at the local level as Secretary, President-Elect, and President. She serves on the International Education Task Force and is an Education Liaison for Region VII. Keri has earned several awards from IAIP, including International Client Service Professional of the Year 2023 and International Risk Manager of the Year 2021. Her most recent accomplishments for IAIP include revising and refining the Confidence While Communicating® course and condensing it to create CWC Essentials. Keri is pursuing a Bachelor of Arts in Applied Management at Grand Canyon University. In 2021, she published her first book, Hindsight 2020, under the pen name Jessie Jericho.