Underwriters say the quality of broker submissions has gone up in recent years but when there is a problem it’s often a lack of quality detail on risk profiles. Andrew McMellin, president of Markel International, told Insurance Business that “clarity of information” from brokers that can enable “certainty on the data” is essential. With that in mind, IB reached out to local underwriters in financial lines, construction, cyber and agriculture to find out more about this information deficit – and other issues – that can torpedo a broker’s cover request for a client.
“Most of the time it comes down to the quality of the submission and how much detail is shared about the risk profile,” said Kerryn Symes (pictured above, top left), NSW Manager for DUAL Australia.
Symes, who specialises in financial lines said sometimes brokers send incorrect or incomplete proposals or just quick emails with very basic information and “not much else to work with”.
“We need as much detailed information as we can, rather than less,” said Nick Vernon (pictured above, top right), co-CEO at Scope Underwriting, a construction specialist.
Vernon said when underwriters are working off minimal information they “often assume the worst”. He said that can lead to higher rates and deductibles and more restrictions to cover.
Cyber specialist Richard Smith (pictured above, bottom left), CEO of Sync Underwriting, said the underlying cause of a lack of information from brokers can be their failure to engage with the underwriter so they can understand what they need to write a risk.
“Brokers who fail to engage with underwriters are unable to build trust and understand underwriters' appetite and coverage benefits,” said Smith.
James Hooper (pictured above, bottom right), managing director of Rural Affinity, said a lack of detail in broker submissions can still be the main problem, but it tends to crop up with generalist rather than specialist brokers.
“If we have an issue [in the rural insurance sector], it tends to be with brokers who don’t do a lot of farm business so they don’t understand some of the intricacies,” said Hooper.
He said those intricacies can be around providing a detailed view of all the risk related activities on a farm, not just those that are directly farming related.
Hooper said when this was a wider broker issue for his sector a few years ago it was actually driven by some of the bigger insurers who were offering cover based on very limited risk details.
“We went through a period where we were getting a lot of push back from brokers because we started asking simple things like: what year was this shed built and what’s it made of,” said Hooper.
He said insurers in the farm market “have evolved” as a result of losing money and most rural brokers are now accustomed to sending in more detailed information.
According to industry sources, other issues with broker submissions include:
Inaccurate or outdated data: Errors in financials, property values, or business operations can result in incorrect underwriting decisions.
Poorly structured submissions: Disorganised or unclear presentation of information makes it difficult for underwriters to quickly assess the risk.
Lack of risk differentiation: Failure to highlight unique risk features or risk management practices that could favourably influence underwriting.
Missing or insufficient supporting documents: Absence of required forms, loss runs, or supplementary reports.
Ambiguity in coverage requests: Vague or inconsistent requests regarding coverage limits, terms, or conditions.
Failure to address underwriter questions: Not anticipating or pre-emptively answering likely underwriter concerns.
Inadequate narrative: Lack of a compelling story or rationale explaining why the risk is attractive or how negative aspects are mitigated.
Non-compliance with submission guidelines: Ignoring carrier-specific requirements or preferred formats.
Late submissions: Providing information too close to deadlines, leaving insufficient time for thorough underwriting review.
Are you an underwriter? When there’s a problem with a submission from a broker what does it tend to be? Please tell us below.
