In my experience with similar cases, I figured out that for each waiver, I should seek the exception of certain requirements pertaining to the General Liability (GL) and Professional Liability (PL) coverage requirements. My request for a waiver will demonstrate the client’s financial stability and their ability to sustain any losses that may exceed coverage requirements. I will make this possible by providing net worth and liquidity details and loss monitoring.
In my opinion, another key factor that is important for the approval of our waiver request is the use of existing coverage policies and their sufficiency. To further strengthen the case, I also have to provide a reason for not being in compliance with the requirements according to the type of case. It may vary in different scenarios. Some reasons for the current coverage being non-compliant can be due various factors that include lack of availability or a change in legal requirements.
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: | Liability |
| Insurance Term: | Prof Liability (Seniors Only) - Per Location (Blanket) |
Template Outline:
#1 - How to structure the introductory section of the document?
The introduction section of the waiver should clearly provide the requestor’s identity and the purpose or type the requestor is applying for. The examples provided below can be used for further assistance.
<Organization/Borrower name> is currently applying for a waiver of the <GL/PL coverage requirement name/details>.
<Agent name> is seeking the waiver of the <GL/PL coverage requirement name/details> on behalf of <Organization/Client name>.
#2 - What factors demonstrate the damage occurrence and ability to sustain damages?
When applying for a waiver, it’s important to ensure that all financial details that demonstrate financial stability are provided. Providing such details helps demonstrate that the organization/borrower is able to account for damages that may exceed coverage requirements.
Such financial stability can be provided using the borrower’s net worth and liquidity. In addition, borrowers should also provide details about their loss/claims monitoring protocols and history to demonstrate the possible occurrence and extent of damages. Provided below is an example that can be used for further assistance.
<Borrower name> currently has a net worth of <dollar amount> and a liquidity value of <dollar amount>. The loss/claims history demonstrates that the property has had losses/damages of only <dollar amount> over the past <number of years>.
#3 - How to provide current coverage details?
It’s important for borrowers to provide details of the current insurance coverage as it can help demonstrate a certain extent of compliance to the coverage requirements. When providing such details, borrowers should provide details of the policies and their structures. The example provided below can be used for further assistance.
<Organization name> currently has insurance coverage from <insurance provider>. The coverage currently includes <coverage types/details> and is based on <policy structure>.
#4 - How to emphasize coverage aggregates and per occurrence limits?
In addition to providing coverage details, borrowers should also emphasize the current policy’s aggregates, per occurrence limits, and other coverage limits that comply with coverage requirements. Provided below is an example that can be used for further assistance if required.
The current insurance policy has an annual aggregate of <dollar amount> and a per-occurrence coverage limit of <dollar amount>. In addition, the <organization/borrower name> also has a self-insured retention (SIR) of <dollar amount> which is in compliance with <coverage requirement name>.
#5 - How to elaborate on the reasons for non-compliance?
Organizations/borrowers applying for a waiver should also demonstrate the reasons for non-compliance. Such reasons can be based on compliant coverage options being unavailable or a change in coverage requirements has made the once compliant coverage non-compliant. The examples provided below can be used for further assistance.
<Organization/Borrower name> is currently unable to acquire compliant coverage options due to a lack of availability from the current provider.
<Organization/Borrower name> has had the current coverage in place since <date>. The coverage has been compliant until <date>. However, a recent change in coverage requirement on <date> that states <details about coverage requirements> has made the policy non-compliant.
#6 - How to justify the request for exception?
Before submitting the request for exception, it’s important that the organization/borrower provides a justification for their request. Such justification can be based on the sufficiency of the current coverage, their ability to sustain damages/losses that exceed coverage requirements, and the lack of compliant coverage options. In addition, mentioning the approval granted for previous waivers for similar requirements can further strengthen the request.
