As far as my experience with waivers is concerned, the insurance coverage requirements pertaining to Earthquake Insurance should be waived since they are helpful in demonstrating the sufficiency of the current coverage to account for the damages. For your understanding, earthquake insurance refers to a type of insurance policy that provides coverage from damages/losses caused by seismic activity. I think that the policyholder’s details regarding the extent of compliance of other coverages is also found to be extremely important in determining the success of the case.
Furthermore, I think that using the details about the Scenario Expected Loss (SEL) is also important. SEL refers to a method of assessing and expressing the expected average damage a property may experience due to seismic activity. Thus, it is understood that providing details about the SEL in our waiver request can help demonstrate that the current coverage is sufficient to account for such damages.
An individual could create an insurance waiver for the following specifications based on the outline given below.
Specifications:
| Waiver Type | Renewal/New Origination |
| Insurance Type | Property |
| Insurance Term | Earthquake - Limit |
Template Outline:
#1 - How should the introductory section of the waiver be written?
The introductory section of the waiver should clearly state the requestor’s identity and the purpose/type of waiver being requested. The examples provided below can be used for further assistance if needed.
<Organization/Borrower name> is currently seeking a waiver for certain coverage requirements pertaining to Earthquake Insurance. These requirements include <Requirement details>.
<Agent name> is currently requesting a waiver for certain coverage requirements pertaining to Earthquake insurance on behalf of <Requirements details>. These requirements include <Requirement Details>.
#2 - Should details about the current coverage be included in the waiver?
Disclaimer: This factor is not applicable to each case but has been added for the sake of comprehensiveness.
The organization/borrower can provide details about their current coverage when requesting a waiver. These details may include the coverage name, type, and limits. Providing this information can help determine the availability of sufficient coverage in the event of damages/loss. Below is an example that can be used for further details if required.
<Organization/Borrower name> currently has <Insurance coverage 1> and <Insurance coverage 2> in place from <Insurance carrier name>. <Insurance coverage 1> is a <insurance type> policy that is structured as <Structure details> with a limit of <dollar amount>. Whereas <Insurance coverage 2> is a <Insurance type> policy having a limit of <dollar amount>.
#3 - How to emphasize the current coverage’s extent of compliance?
When writing the waiver, the organization/borrower can emphasize the compliance extent of their current coverage. This can be done by mentioning which aspects of the current coverage are in compliance with the insurance requirements. Provided below is an example that can be used for additional guidance if needed.
<Organization/Borrower name>, currently does not have coverage for <Coverage requirement>. However, coverage limits of <dollar amount> and <dollar amount> for <Insurance coverage 1> and <Insurance coverage 2> are in compliance with <Insurance coverage requirement details> pertaining to these coverages.
#4 - How to provide the reason for non-compliance?
Disclaimer: The factor may not be applicable to each case and has been included for the sake of comprehensiveness.
The organization/borrower can also provide information about why they have their current coverage is non-compliant. Reasons for the coverage being non-compliant include market limitations and the current coverage being the best possible option the organization/borrower can afford. The example provided below can be used for further assistance if needed.
<Organization/Borrower name> currently has coverage from <Insurance carrier name>. Given the current market conditions, the current coverage is the best possible option the <Organization/Borrower name> could secure at an affordable price of <dollar amount> with coverage limits of <dollar amount> and <dollar amount>.
#5 - How to provide details about the Scenario Expected Loss (SEL)?
When writing the waiver, the organization/borrower should provide details about the SEL pertaining to the property. Providing such details can help illustrate the expected amount of damage the organization/borrower may experience due to seismic activity. Below is an example that can be used for additional guidance if needed.
<Property name> owned by <Organization/Borrower name> currently has an SEL of <SEL percentage> which would result in a loss of <dollar amount>. It’s important to note that the loss of <dollar amount> is within the <Insurance coverage name> limit of <dollar amount>.
#6 - How to demonstrate financial stability when applying for a waiver?
Disclaimer: This factor may not be applicable to each case, however, it has been added for the sake of comprehensiveness.
The organization/borrower can provide details about their or their guarantor(s) net worth and liquidity. Providing this information can help illustrate the organization/borrower's ability to account for damages/losses that exceed, or are not accounted for, in the current coverage. Provided below is an example that can be used for further assistance if needed.
<Person 1> has been identified as the guarantor for this <Organization/Borrower name>. As of <Date>, <Person 1> currently has a net worth of <dollar amount> and a liquidity value of <dollar amount>. Therefore, the <Organization/Borrower name> is able to account for damages/losses that exceed the current coverage of <dollar amount> or are not accounted for by the current coverage.
#7 - How to provide a justification for the waiver being requested?
Before submitting the waiver, the organization/borrower should provide a justification as to why it should be approved. This justification can be made based on the SEL amount pertaining to the property. Providing such information can help determine if the current coverage is sufficient to account for the damage caused due to seismic activity. In addition to providing these details, the organization/borrower should also emphasize the extent of compliance of the current coverage as it can strengthen the waiver request.