Anthony Falcon
Filling in insurance proposal forms may seem a rather mundane pursuit.
Generally no one welcomes the rather thankless task of having to go through the laborious claims' enquiry process, calculating the fee split of work and then completing the form.
Yet so much money is at stake, and premiums have become so costly, that time and effort spent doing the job really professionally will nearly always be well rewarded in the shape of lower premiums. So filling in these forms properly does matter.
Firstly, a few obvious pointers. Try to get the form typed if possible. Scruffy copies of faxed sheets make a very poor impression, and insurers who are looking at hundreds of forms a day will be unimpressed and unlikely to offer any special terms.
Proposal forms are standard documents and often the partnership can be presented in a better light by adding some thoughtful additional information.
Here are several ideas which when expanded can help to create the right type of climate with insurers.
Firstly has anything been done by the firm in the area of BS 5750 or a similar standard. This demonstrates a commitment to ongoing quality control, and some insurers are willing to help with a discount.
Has your broker helped to develop any kind of supplementary risk guide for you to complete in conjunction with the form? In many cases this can qualify for a useful saving.
Insurers are interested in at least eight core areas within the firm.
Among these three are particularly important, namely how does management communication work within the firm, how is client care handled, and what is the claims history over the past five years?
Secondly, can any evidence be found to highlight good management practices? For example could the partner-ship/staff ratio be used as evidence of close control and supervision of the work undertaken. A good broker can make much of this type of point which might otherwise remain buried in the proposal form and never be appreciated.
Thirdly, are there any claims which are effectively stale matters which could be safely de-leted from the claims' schedule with the agreement of the SIF? The fewer the circumstances, reserves, or paid settlements you show, the better your history and the lower the premium.
Next can anything be said to feature work/fees earned in areas which are thought to have a particularly low risk? For example, work undertaken on behalf of charities will be likely to attract less risk than mergers and acquisitions.
Putting too many brokers into the market can be counter productive and you should never have more than three serious brokers in the market. We recently had excellent renewal terms withdrawn (admittedly by pretty capricious insurers) because two brokers approached them!
Anthony Falcon is chair of Anthony K Falcon in London.
