Commercial property and engineering

Commercial property and engineering policies are priced and managed location by location, or project by project.

Hazard zones

Lines > Hazard zones lists the areas exposed to earthquake, flood, storm and other perils. A zone has a grade, a loading added to the premium of the locations in it, the towns it covers (or a box of latitude and longitude) and an accumulation limit: the most the company wants insured in that zone.

Accumulation and map shows how much is insured in each zone against its limit, and the locations on a simple map. When a new location would take a zone over its limit, the quote is referred to an underwriter.

The schedule of locations

On a quote for a property or engineering product, the Locations tab takes each building: its address and town, construction, occupancy, protections (sprinklers, alarms and so on), floor area, and the values of building, contents and stock. Business interruption cover takes the gross profit and the indemnity period.

The hazard zone is found from the town or coordinates. The sum insured of the quote is the total of the locations, and the premium is worked out for each one: the base rate, plus the zone loading, less the discount for protections, with business interruption added. The breakdown shows every location. The schedule is copied to the policy on issue.

Valuations

Lines > Rebuild rates sets the cost of rebuilding per square metre by construction. Valuation on a location works out the reinstatement value from the floor area and the rate, and compares it to the value declared. A location under-insured by more than the margin is flagged, and the average clause will reduce claims in proportion.

Inspections

Inspection on a location books a risk survey. When the surveyor reports, the location takes the risk grade given, and each recommendation has a due date. Recommendations not done by their date are listed for the underwriters.

Business interruption claims

On a property claim, Business interruption works out the loss of gross profit from the fall in turnover, adds the increased cost of working (only as far as it saved turnover), and applies the average clause when the gross profit insured was too low.

Engineering projects

Contractors all risks, erection all risks, machinery breakdown and electronic equipment are recorded under Lines > Engineering projects: the contract value, the principal and contractor, third-party limit, the construction period, testing weeks and the maintenance period after handover. The project's progress and status are kept up to date by the underwriter. A claim on an engineering policy checks that the loss happened during the project period.