Managing Underwriting Analysis

Workflow

1. Triage the submission

   • Confirm the risk falls within underwriting appetite and authority limits
   • Identify line of business, coverage form, and territory [VERIFY admitted vs. surplus lines requirements]
   • Flag any exclusions, manuscript endorsements, or non-standard terms requested

2. Assemble the risk profile

   • Compile exposure measures: payroll, revenue, unit count, TIV, vehicle schedules, or other relevant bases
   • Map loss history to current exposure base and apply loss-development factors (link-ratio or Bornhuetter-Ferguson as appropriate)
   • Calculate loss ratios (ultimate, paid, incurred) at both per-occurrence and aggregate levels
   • Identify large-loss loads vs. attritional layer frequency trends

3. Perform pricing analysis

   • Run experience rating: compare indicated loss cost to manual/filed rate
   • Apply schedule credits/debits with documented justification for each factor
   • Incorporate increased-limit factors, deductible credits, and retrospective rating adjustments where applicable
   • Model catastrophe/aggregation exposure using vendor models or internal curves [VERIFY cat-model version and return-period thresholds per company guidelines]
   • Compare proposed premium to minimum rate-on-line, target combined ratio, and risk-adjusted return metrics

4. Evaluate terms and conditions

   • Review policy form (occurrence vs. claims-made, defense inside/outside limits, hammer clauses)
   • Assess sub-limits, SIRs/deductibles, aggregates, and erosion scenarios
   • Check collateral/security requirements for loss-sensitive programs
   • Confirm reinsurance applicability: does the risk attach to existing treaties or require facultative placement?

5. Document the underwriting decision

   • Prepare a structured underwriting memo summarizing risk characteristics, pricing rationale, and terms
   • State the recommendation: bind, decline, or counter-offer with specified conditions
   • Note any referral items requiring senior authority sign-off
   • Record binding subjectivities and conditions precedent to coverage

6. Coordinate follow-through

   • Track outstanding subjectivities with deadlines
   • Communicate binding authority decisions to brokers/agents with quote-validity periods
   • Update portfolio tracking systems with new exposure, premium, and modeled PMLs
   • Flag upcoming renewal dates and diary triggers for re-underwriting

Output

The deliverable is an Underwriting Analysis Report containing:

• Executive summary: risk description, line of business, recommended action, and key metrics (proposed premium, target loss ratio, rate change %)
• Risk profile section: exposure detail, loss history tables with development, large-loss narrative
• Pricing section: experience-rated indication, schedule rating worksheet, cat-load summary, final proposed premium vs. technical price
• Terms section: coverage form, limits/deductibles, notable endorsements, reinsurance placement notes
• Decision and rationale: clear bind/decline/counter recommendation with supporting justification
• Open items tracker: outstanding subjectivities, information requests, and deadlines

Quality Checks

• Loss ratios and premium calculations are internally consistent and tie to source data
• All schedule rating credits/debits are individually justified — no unexplained blanket adjustments
• Cat exposure is quantified and within portfolio aggregation tolerances
• Reinsurance cession is correctly allocated and treaty terms are respected
• Authority limits are verified — escalation documented if referral is required [VERIFY per company underwriting authority matrix]
• Filing and compliance requirements confirmed for the applicable jurisdiction [VERIFY surplus lines stamping, rate/form filing status]
• No stale data: loss valuations, financial statements, and inspection reports are current within acceptable windows
• Assumptions (trend factors, development selections, benchmark selections) are explicitly stated, not embedded silently