How Much Time Will It Take for My Nonprofit to Get an Insurance Quote? (Part 2)

A look behind the curtain of the insurance application process

Photo Credit: purplemattfish via Compfight cc

For the short answer to the question of how long it takes to get an insurance proposal, please read Part 1.

Pulling back the curtain

Many insurance applicants assume when they call that the commercial insurance underwriting process is as simple as it is when applying for auto or homeowners insurance.

It is not. For nonprofits, especially, we have no or very little capability to take your information, do some data entry, and offer up an insurance quote. It’s a more complex process.

This post will hopefully show you why it takes some time to go from your initial phone call to an agent to a proposal in hand.

The example I give will a behind the scenes look at a very simple, phone call and email driven process. If scheduling an appointment for an in person visit is involved, the time line would be a bit longer, depending on scheduling.

The Initial Phone Call: Realize Your Agent Will Have Multiple Ongoing Projects

When you call an agent to get an insurance policy, she is already working on other projects. She has current clients she might be assessing coverage for. She has other new business accounts that she is working on.

There is a queue line. And under normal circumstances you will be placed in that queue line in chronological order.

There are emergencies, but the agent cannot always honor those emergencies without completely shafting every other client he has in the pipeline.

That said, most agents will make time to talk to you and get a handle on your needs.

The Information Gathering Stage: You’ll Have Work To Do (While the Agent Gets Things Going on Her End)

The agent will need to gather information from you. If you are forthcoming and diligent in completing applications and providing other information, your insurance application life will be absolutely dreamy.

Being quick to return your applications or provide other information will drive how swiftly you receive quotes.

Normally, these are the elements of the information we’ll put together to send to the insurance company:

  1. Acord Applications: These are the standard insurance applications for every commercial policy submission. The agent or an account manager will need a good 30 minutes on a simple application to a full day if there is a major property or auto schedule.
  2. Supplemental Applications: In the human services world, insurance companies have their own specific applications to capture information that isn’t on the Acord application. You will need to do most of the heavy lifting for these applications (or agree to a meeting or phone call for the agent to grill you).
  3. Loss History (or a No Loss Letter if you’ve never had coverage): All carriers will want proof of your claims history. “We ain’t had no claims” in the body of an email isn’t sufficient proof. You will need to ask for ‘Loss Runs’ from your current carrier. This bit of info is of utmost importance.
  4. Licenses or Resumes: If you are a licensed facility, most carriers will want a copy. If you are newer in business, most carriers will want a copy of a resume.

Off Goes The Application: Now We Enter Into the Underwriter’s World

We send this package (called a ‘submission’) to our insurance carriers’ underwriters.

Guess what? The underwriter also has other projects, so we’ll normally need to enter his stack of work in order of appearance. Some carriers are quicker than others, but normally it’ll take at least a day before they pick up the submission for an initial review.

The Dance of the Underwriter, Agent, and Applicant

Most carriers will have follow up questions. 90% of the time we will get questions to pass back to you. You will need to provide those answers.

Then we go back to the underwriter with your answers. And then, perhaps, we might do that again. This is why it’s important for diligence on the front end by the applicant and the agent. If the initial applications are detailed, then there will be less need for this little back and forth dancing.

The Rating and the Proposing

After the underwriter is sufficiently happy with the information, he will either rate your application himself or pass it along to a ‘rater’ to do all the data entry in order to spit out premium indications.

The underwriter then sends us their proposal. The insurance agent confirms that the proposal offers the coverages the applicant needed.

Depending on the situation, the agent will beautify the proposal and present in person or send it to the applicant (these decisions, sadly, are normally made based on economics – large accounts will normally garner an in-person presentation).

In a perfect world, for a small and simple nonprofit and an agent with a free calendar, here would be the flow:

  1. First 24 Hours: You call. We gather information from you and you receive and return insurance applications.
  2. Day 2: We create insurance applications in our system and gather as much information from you as we think we’ll need and send to the underwriter.
  3. Day 3: Underwriter acknowledges and puts in her queue.
  4. Day 4 or 5: Underwriter normally will send a follow up question and we’ll return our response(s).
  5. Day 5 or 6: Your application will be rated.
  6. Day 6 or 7: Your proposal (might) be available.

I direct you to my previous post on this topic. Expect 1 month. By the time everything is said and done, the project will probably take roughly a month.

And if it doesn’t a month? You’ll be that much happier.

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Do you have questions about the process?

What has your experience been?

Comments

  1. Paul Davidson says:

    Great article. Thanks for the info, you made it easy to understand. BTW, Just in case anyone needs to fill out a Acord forms, I found a blank forms in this site PDFfiller. This site also has some tutorials on how to fill it out and a tons of fillable Acord forms that you might find useful. Here is a link to the blank Acord 130 form that I was able to fill out http://goo.gl/cIQ1At.

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