GETTING AHEAD OF THE GAME

Earlier in this new year we’ve looked at divergent forecasts for the Commercial Property insurance market ranging from the California Surplus Line Association to leading insurance brokerage data and commentary (Insurance Journal). While the landscape varies in terms of rate increases, everything we’ve seen thus far points to a higher degree of difficulty this year for brokers and agents looking to cover “challenged occupancies,” with markets placing the blame for rate accelerations on 2021s overall “extreme loss patterns.”

A review of various forecasts all point to the same conclusion – prioritizing risk improvement is key. This is particularly important for property owners in high risk areas prone to natural catastrophes such as the designated wildfire and Wildland-Urban interface (aka “WUI” or “Woo-Eee” – the zone of transition between wilderness and land developed by human activity; an area where a built environment meets or intermingles with a natural environment; check this link for an interactive California ESRI ArcGIS WUI), wind, hail, and tornadoes.

Our last blog entry on Novita’s Learning Center delved in to how brokers and agents can work to position their clients – new submissions or renewals – to respond to proactively to a 2022 market under pressure.

2022 “FOUR STEP” PROGRAM FOR BROKERS AND AGENTS

1. Gain – and maintain – a position as trusted source/resource for your clients. Brokers and agents have a unique relationship as a valued protector of a client’s assets. Providing advice and counsel to clients in the evolving world of risk management and mitigation is key to helping clients manage coverage and cost. Establishing and maintaining a collaboration culture with clients based on effective communication helps brokers and agents better market a specific risk, while also managing client expectations.
2. Dig into current coverage; assess whether the client is properly covered. Underwriting criteria changes as risk appetite rises and falls. What may have worked in the past may not be the answer in the present, and even less so in the future.
3. Review client programs. Insurance Industry studies show some 75 percent of commercial buildings are underinsured. Insurers need accurate assessments of replacement costs in case of an event. The estimate can help improve achieving premiums appropriate to a client’s risk, better quantify exposure, and help educate and inform clients on adequate policy limits.
4. Increase the use of data and analytics when preparing new submissions and renewals. Using hard data and analytics helps form the narrative and tells a more complete story of a property to an underwriter as underwriting guidelines and criterion become more complex.

At Novita Insurance Solutions, LLC, we work closely with our agent/broker partners to vet, develop effective risk management and mitigation strategies, and communicate information needed to secure coverages. Contact us and let us assist you in keeping on track and successfully getting across the finish line in 2022. We got this!