Navigating Property Risk Placement

In the evolving landscape of property insurance, brokers play a pivotal role in connecting customers with insurers. Whether placing small commercial units or complex manufacturing facilities, brokers must navigate underwriting criteria, shifting risk appetites, regulatory frameworks, and customer expectations.

Success increasingly depends on strategic risk assessment and proactive market engagement.

Understanding the Scale and Nature of the Risk

Property risks vary significantly in scale and complexity - small doesn’t always mean simple. Small-scale risks - these generally work well in a package solution, for example retail shops, small offices and small warehouses.

However, brokers should verify that standard limits adequately match the customer exposure. A strong understanding of your customer’s business, combined with flexible underwriter relationships, helps avoid underinsurance or overlooked exposures.

Medium-scale risks - multi-tenanted business parks or mid-sized commercial premises require more nuanced assessment around occupancy, fire protection and local hazards.

Large-scale risks - manufacturing plants, logistics hubs, mixed-use developments may demand engineering reports or detailed process maps and often involve multiple insurers and layered placements.

Risk Assessment and Underwriting Preparation

Underwriters are generally concerned with matching effective controls to risk and hazard. Effective placement begins with pre-underwriting, matching the broker evaluation and description of the risk with information required by the insurer by way of detailed presentations.

This includes:

• Reviewing property characteristics - construction type, presence and specification of composite panels, age and location of premises and fire separation
  within the structures
• Detailed description of the process - e.g. for manufacturing, detail the process flow from raw material through production process to finished product and distribution
• Fire protections/Security/Controls - e.g. type of alarm detection, full sprinkler system or isolated suppression in kitchens or forklift charging areas, hose reels, fire extinguishing appliances, planned preventative maintenence programmes, service maintenance contracts and statutory inspection detail on plant and utilities including electrics
• Identifying controls proportionate to hazards - e.g. ATEX (from French ATmosphere EXplosible) compliance in potentially explosive workplace environments with flammable gases or combustible dust
• Accreditations/Standards - e.g. BRC, ISO, HACCP - generally achieving industry accreditations entails continuous demonstration to audit bodies of adherence to industry standards and protocols

Market Conditions and Insurer Appetite

The property insurance market is cyclical. During hard markets, insurers reduce capacity, tighten terms and raise premiums; during soft markets, competition increases and terms improve.

Brokers must stay attuned to:

• Insurer appetite for specific property types
• Reinsurance treaty renewals, which affect capacity
• Emerging risks such as climate change, cyber threats and supply chain disruptions

Most customers like stability when it comes to property placements both in terms of predictable pricing and insurers they recognise.

Regulatory and Compliance Considerations

Brokers are extremely conscious of their regulatory obligations, as are insurers. Clear communication helps both to ensure they meet these obligations. The end customer may also have obligations, e.g. they must ensure placements comply with lender requirements or contracts with customers. In addition, global parent companies may require specific insurer ratings for their group entities. It is important that the flow of communications between all three parties is transparent to facilitate full compliance and tailored solutions where required.

Claims History and Loss Control

Insurers scrutinise claims history closely, particularly for medium to large placements. Brokers should present not just the data, but the story behindit: provide context for past claims, detail the cause of losses, and highlight corrective measures taken to prevent recurrence. If claims experience has improved, explain the measures that drove the improvement. Proactive claims commentary can significantly improve underwriting outcomes.

Documentation and Communication

Clear, complete documentation is essential.

Brokers should:

• Generate a consistent submission template
• Submit full property details, valuations and risk surveys - more detail means less queries and quicker response times
• Communicate timelines and expectations to customers and underwriters

Quality submissions lead to faster underwriting and quicker customer responses. For large or complex risks, approaching the market 1-2 months before renewal typically yields better outcomes.

Conclusion

Placing property risks is a nuanced process that demands technical expertise, market awareness and strategic communication. Brokers must tailor their approach to the scale of the risk, anticipate market shifts and proactively manage underwriting relationships.

As the adage goes ‘fail to prepare, prepare to fail’, so success lies in preparation, transparency and adaptability. Failures in documentation, risk presentation or regulatory alignment can lead to coverage gaps, premium hikes or outright rejection. However, with the right tools and insights, brokers and insurers can navigate even the most challenging placements and deliver value to customers across the property spectrum.

Pierce Williams 

Senior Underwriting Surveyor at Intact Insurance

Expert in property placement and specialises in pre cover Risk Surveying