By Ivy Riggs, Executive Underwriter
Do you dream of the day when automated quoting systems remove pesky underwriters from the production loop? A day when you can get your Site Pollution quotes instantly, with no irritating follow-up questions or caveats to slow down the process? If you would rather have an experienced underwriter giving your accounts the attention they deserve, showing consideration to all important factors, then unfortunately there are times when certain pieces of a submission need clarification in order to correctly quote the account. Here are three actions you can take to make sure your Site Pollution submission is complete and accurate, giving you a better chance of receiving a good quote.
Step #1: Verify the Specific Site Address and ZIP Code
For most Site Specific Pollution Liability insurance, coverage is contingent upon the insured site being scheduled to the policy. While exceptions can be made for new acquired property, common provisions require these to be reported to the carrier within a designated timeframe and accordingly scheduled. Any property not so scheduled is precluded from coverage.
Because of these provisions, one might think that rigorous verification of an insured property address would be standard protocol; however this is often not the case. Mistakes like transposing numbers, omitting directional designations like “southeast,” or providing an incorrect ZIP code are all common errors. Often they are viewed as mere “typos,” easily fixable with a simple endorsement. But rarely is this actually the case.
The reason for this is based in how most public environmental records are searched. For example, a generic site address like â€œ20 Commerce St.â€ might retrieve hundreds of hits, with maybe only one or two of them referencing the target location. ZIP codes are extremely useful as a first layer filter for screening out irrelevant records. If these irrelevant records contain negative environmental information such as an “onsite leaking underground storage tank” an applicant might be erroneously denied coverage or charged an inappropriately high premium. Conversely, an inaccurately rosy picture could cause an inadequate price to be developed, possibly resulting in a mid-term increase, cancellation, or non-renewal from the carrier when the error is detected. Performing verifications at the following website can help you to check for potential issues with the way the addresses and/or zip codes appear: https://tools.usps.com/go/ZipLookupAction_input.
Step #2: Confirm the Most Applicable NAICS Code
In addition to scheduling a specific site address, most Site Pollution policies also schedule the anticipated operations to be conducted at that property. Again, coverage is frequently predicated upon this information being correct at the time a pollution loss occurs. If it isn’t, for example, if an auto repair shop has been expanded into a full service gas station coverage may be denied for misrepresentation or an unexpected increase in the associated pollution risk.
Because onsite operations are crucial to evaluating and pricing an environmental risk, many Site Pollution rating models utilize NAICS codes (or their SIC equivalents) to establish base pricing and/or policy terms applicable to each risk class. The most interesting thing about these codes, however, is that they are self-assigned, with no penalty for choosing the wrong one; the NAICS Association has no enforcement division. The one exception to this general rule is if a business has an environmental impact, in which case the EPA or state DEP may take an active interest in assigning a code to that entity. The important lesson here is that whether self-assigned or not, if the NAICS code is inaccurate, the error can negatively impact both the resulting premium and terms offered for a given risk. By confirming these codes at http://www.naics.com/search/, a producer may decrease the likelihood of errors.
Step #3: Check to See if the Site Lies in a Flood Zone
There are many pollution risks associated with floodwaters: offsite contamination may be carried or deposited onsite; pollutants generated or stored onsite may migrate offsite; water damage to onsite structures may result in mold growth and indoor air quality problems. Because environmental liability for cleanup costs, property damage, or bodily injury claims may result from any of these risks, an insured property’s vulnerability to a flood event is an important piece of information.
It is also readily available through FEMA at https://msc.fema.gov/portal. Unfortunately, much of the information is outdated or otherwise inaccurate, and the painstaking process to correct these shortcomings tends to be underfunded, slow, and focused almost exclusively upon coastal areas. Searching these public records can facilitate any forewarning of terms that should be negotiated into the premium for a winning Site Pollution insurance proposal.
By working to compile all of these necessary components, and checking to make sure all information is accurate, you can avoid these common missteps when submitting a Site Pollution account. Your environmental underwriter will then have all the information he or she needs to construct your quote efficiently and correctly. For more information on creating a successful submission, email email@example.com.