How Architects and Engineers Insurance Underwriting Works

Insurance Underwriting is the process an insurance company uses to assess the eligibility of a customer to receive their architect or engieners insurance coverage. Any risk-transfer institution has an underwriting department that serves as the regulating body in the insurance company whose function is to evaluate the risk and exposure of potential clients, deciding how much coverage they should receive and how much they should pay. If the underwriter thinks insuring the client may be too risky to the bottom line of the insurance company, he or she may decide to not offer the client coverage at all.

It is important for an architectural or engineering firm to know the guidelines by which a typical underwriter will judge them. These guidelines are objective and based on the probable cost to the insurance company to provide the coverage.

The criteria for evaluating the risk and exposure of a client is different for each provider and insurance coverage type. Underwriting for architectural and engineering firms often depends on analysis of economic trends and indicators, cash flow and solvency, earnings volatility, employee ratio, industry forecast, growth rating, efficiency, firm type, ownership structure, current debt and profitability.

Meeting the insurance underwriting guidelines is favorable to both parties. Not just the insurer and insured, but also for the clients who will seek your professional services as their Architects or Engineers. It will provide peace of mind knowing they are well-covered in case of an accident.