Avoiding the Naughty List: 3 Zurich Builders Risk Mistakes to Skip
Each month, US Assure Director of Producer Training and Development Mary Stiglic joins us in the studio to address a common question or pain point to help you confidently sell to and service your construction insurance clients.
Read the Video Transcript:
Ooooh whee… that one’s a doozy.
Hey there!
I got my hands on the naughty list and let’s just say a few builders risk applications could use a little extra cheer … and a second look. You know … slowing down and double checking the application twice can save you from a sleigh-full of trouble later.
Let’s unwrap three common policy issuance mistakes to avoid so you don’t get Santa’s tinsel in a tangle.
Mistake #1: Putting TBD as the property address.
This is an easy mistake to make, especially in housing developments. It might seem like the right choice when a new address hasn’t, but it can cause a bunch of problems in the event of a claim. If claims can’t determine the actual location, your client may not get their claim payment in a timely manner.
If you don’t want your sleigh privileges revoked, provide the lot number, parcel number and crossroads if the address isn’t assigned yet. And if you find a mistake has been made, submit an endorsement to correct it before a loss occurs.
Mistake #2: Listing an incorrect percentage complete.
Calculating this is easy-peasy. Simply take the total completed value and divide by the amount already completed. For example, let’s say the total completed value for a gingerbread mansion is one million dollars, and they already have four-hundred-thousand dollars spent. So that would be forty percent complete.
If you don’t want coal in your stocking, double check that percentage. If the project is more than thirty percent complete and underwriting hasn’t had the opportunity to review the account, potential claim payouts may be in jeopardy. Anything built prior to the policy inception may not be covered. If we don’t know it exists, how can we cover it?
Mistake #3: When you’re applying for builders risk coverage in our online portal, not selecting the existing structure box for home remodeling clients who need that coverage.
If this box isn’t checked, coverage for the existing structure will not trigger in the event of a loss. And that’s true even if you add the value of the existing ski chalet to the cost of the renovations and list that on the renovation line.
Don’t do that, please. That one drives Santa to hit the special hot cocoa hard.
And for Santa’s sake, have your client sign the application.
Hope this helps keep you off the naughty list! Snowball is in your court.
That’s a wrap for 2025!
‘Til next time.
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