Specifications:

Waiver Type:                            New Origination

Insurance Type:                       Property

Insurance Term:                       Property Damage - Coinsurance

Template Outline:

#1 - How to structure the introductory section of the waiver?

In the opening section of the waiver, it’s important to clearly state the requestor’s identity and the purpose/type of waiver being requested. Provided below are a few examples of how the initiating statements can be structured.

<Organization name> is currently seeking the waiver of the Agreed Amount Endorsement for the property <property name/details>.

<Agent name> is currently applying for the waiver of the replacement cost coverage requirements for the property <property name/details> on behalf of the <Organization/Client name>.

#2 - How to demonstrate financial stability?

Requestors should provide all relevant financial details demonstrating that they are financially capable of sustaining replacement costs or costs inflicted due to property damage.

Such stability can be emphasized by providing the net worth and liquidity amounts of the guarantor(s). Provide below is an example of how this statement can be structured.

Guarantors for the property include <Guarantor name(s)>, the guarantor(s) having a net worth of <dollar amount>, and a liquidity of <dollar amount>.

#3 - How to justify the sufficiency of the current coverage?

When applying for a waiver, it’s important to justify that the current insurance coverage is sufficient to avoid activating the coinsurance penalties. Such circumstances occur when the coverage limit for the property exceeds its insurable value. The examples provided below can be used for further assistance if required.

The current coverage limit of the property <property name> is <dollar amount>, whereas the property’s insurable value is <dollar amount>, therefore, coinsurance penalties will not be applicable at the time of loss.

#4 - How to mention the limitations/cost of modifying coverage options or switching providers?

Those applying for a waiver, can also provide details of the certain limitations of their current coverage that keep them from compliance. In addition, they can also provide details about the increased cost that would occur from modifying coverage options mid-term. Provided below is an example of how such details can be shared.

The current coverage <coverage details> for the property <property name> lacks the coverage of <coverage details> and is therefore not compliant. Modifying the coverage mid-term would increase the premium costs by a minimum of <percentage rate of increase in premium costs>, leading to an additional monthly or annual expense of <dollar amount>.

#5 - How to emphasize compliance efforts?

The requester should provide all details pertaining to their compliance efforts. Such details may include seeking alternative coverage and property maintenance details. Provided below is an example of each that can be of further assistance.

<Organization name> is currently seeking coverage options that are fully compliant. As of <date>, the <Organization name> has sought offers/insurance quotes from <insurance provider name(s)> to ensure complete compliance.

<Organization name> currently conducts regular inspection and maintenance at <property name> to ensure its structural integrity.

#6 - How to justify the request for approval?

When applying for a waiver, the requester should justify why their request should be approved. Such justification can be provided based on financial stability and the ability to sustain replacement costs inflicted by damages. In addition, using the approval of previous waivers for the policy can further strengthen the case for approval.