Specifications:

Waiver Type:                            Renewal/New Origination

Insurance Type:                       Property

Insurance Term:                       Property Damage - Deductible

Template Outline:

#1 - What information should be included in the opening section of the waiver?

The opening section of the waiver should clearly state the requestor’s identity and the purpose/type of exception being requested. The examples provided below can be used for assistance when writing this section.

<Organization/Borrower name> is currently applying for the exception of insurance deductible requirements pertaining to <Insurance coverage details>.

<Agent name> is currently seeking the exception of insurance deductible requirements on behalf of <Organization/Borrower name>. These insurance deductible requirements are regarding <Insurance coverage details>.

#2 - What details about the current coverage should be provided?

When writing the waiver, it’s important that the borrower provides all relevant details about their insurance coverage. Such details may include the provider's name, policy name, structure, and type. Providing such details can help demonstrate a certain extent of compliance. Below is an example that can be of additional guidance if needed.

<Organization/Borrower name> currently has insurance coverage from <Insurance provider name>. The <Insurance coverage name> is a <policy type details> and is structured as <policy structure details>.

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

In addition to providing details about the current insurance coverage in place, the borrower should also emphasize the sufficiency of the current coverage. This can be done by providing details about the policy’s applicability. The example provided below can be used for further guidance if required.

The <Insurance coverage name> is a robust program from a single provider that applies in <Scenario 1>, <Scenario 2>, and <Scenario 3> and is currently sufficient for the <Organization/Borrower name>.

#4 - What details pertaining to the borrower’s loss fund should be provided?

Providing details about the loss fund can help demonstrate that the organization/borrower is not likely to experience financial strain due to the current insurance deductible. When providing these details, the organization/borrower can share when and how contributions to the loss fund are made and the total amount of the fund to date. Provided below is an example that can be used for further assistance if needed.

<Organization/Borrower name> currently has a loss fund in place since <date>. Contributions to the fund are made from all assets owned by the <Organization/Borrower name> on a <Contribution details> basis. As of <date>, the loss fund has a total of <dollar amount>.

#5 - How to provide reasons for the non-compliant deductible?

The borrower can provide details about why they have a non-compliant deductible. This information can include the unavailability of insurance coverage with a compliant deductible or unwillingness from the insurance carrier to offer a compliant deductible. Below is an example that can be used for further assistance when writing this section.

<Organization/Borrower name> currently has a deductible of <dollar amount> because the current insurance provider <Insurance provider name> is not offering a complaint deductible of <dollar amount>. In addition, acquiring such a robust policy with a compliant deductible of <dollar amount> from other carriers would incur additional expenses.

#6 - How to emphasize loss/claim history and financial stability?

Providing details about the losses or claims the organization/borrower has experienced can help demonstrate that the organization/borrower has managed to cover the losses or claims with the deducible in place. In addition, providing details about the financial position of the borrower or their key principal can help determine that the current deductible will not lead to financial strain on the organization/borrower. Provided below is an example that can be used for additional guidance if required.

Over the past <number of years>, the <Organization/Borrower name> has witnessed a total of <number of claims> claims. These claims, in total, amounts to <dollar amount>, and since <date>, all claims have been paid. In addition, <Organization 2/Person 2> is identified as the key principal for the <Organization/Borrower name> and currently has a net worth of <dollar amount> and a liquidity value of <dollar amount>.

#7 - How to justify the request for exception?

Prior to submitting the waiver, the borrower should provide a justification for the request by sharing details about their current coverage. The borrower can also emphasize that they have a loss fund in place to account for the non-compliant insurance deductible. In addition, other factors such as a low losses/claims history and financial stability can also help strengthen the request for exception.