Throughout my analysis of waivers over the course of my career, I came across the importance of exception of the terrorism insurance coverage requirement. In order to demonstrate that a property is not situated in a high-risk area, my waiver request included the property’s location details. My request also emphasized on the additional premium costs that would incur in case the terrorism insurance coverage was added. 

In order to demonstrate our ability to sustain damages that would occur due to the unfortunate event of an attack, it is imperative to include the details of the existing insurance coverage in the waiver request. To further strengthen the case of waiver request, factors such as the inability to add required coverage and installation of equipment such as sprinkles and hydrants that minimize damage should be added. 

An individual could create an insurance waiver for the following specifications based on the outline given below. 

Specifications: 

Template Outline: 

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

The opening section of the document should clearly state the requestor’s identity and the purpose/type of waiver being requested. The examples below can be of additional assistance.  

<Organization/Borrower name> is requesting the waiver of the terrorism insurance coverage requirement for <property name>. 

<Agent name> is seeking an exception for the terrorism insurance coverage requirement for <property name> on behalf of <Organization/Borrower name>. 

#2 - What property details should be included in the waiver?  

Borrowers should provide all details pertaining to the properties they own. Providing such details can help determine the allocation of insurance coverage if damages occur due to an unfortunate event. Below is an example that can be used for further assistance if required.  

<Organization/Borrower name> currently owns <property name(s)> located in <City, State>. The property has <number of buildings> and a total of <number of units>.  

#3 - How to mention the possibility of a terrorist attack on or near the property?  

It’s important for borrowers to mention the possibility of a terrorist attack on or near the property. The risk associated with the property’s location can be used to demonstrate that the possibility of a terrorist attack is low if the property is not located in a high-risk region. Provided below is an example that can be used for assistance.  

<Property name> is located in <City, State> which is not a high-risk location. Therefore, it is unlikely that damages/claims would arise from terrorist attacks.  

#4 - How to provide details pertaining to the current insurance coverage?  

When applying for a waiver, borrowers should provide all the details of their current insurance coverage. Such detail can include name(s), type of policies, and coverage limits. Providing these details can help demonstrate the ability to account for damages and a certain extent of compliance. The example provided below can be used for further assistance if required.  

The property, <property name>, is currently insured by <Provider name>. It has a <Coverage name 1> and a <Coverage name 2>. The <Coverage name 1> has a per occurrence limit of <dollar amount> and an aggregate of <dollar amount>. In addition, <Coverage name 2> has a per-occurrence limit of <dollar amount>.  

#5 - How to mention the reason for non-compliance?  

In addition to providing the details of the current coverage, borrowers should also mention their current coverage is non-compliant. Reasons for non-compliant coverage can include the provider’s unwillingness or inability to add terrorism coverage mid-term or costs associated with the required coverage. Provided below is an example that can be used for further assistance if required.  

<Organization/Borrower name> does not have compliant coverage for the <property name> because the provider <provider name> can not add it mid-term.  

<Organization/Borrower name> does not have compliant coverage for the <property name> because the cost associated with the coverage would increase the premium by <dollar amount>.  

#6 - How to justify the request for approval?  

Prior to submitting the request, the borrower should justify why the exception should be granted. This justification can be based on various factors that, include the property not being located in a high-risk region. In addition, these factors can also include costs associated with added compliant coverage options.  

Furthermore, the borrower can mention the installation of equipment, including sprinklers and fire hydrants, to demonstrate that damage can be minimized. Using the factors to justify the request for a waiver can help improve the chances of approval.