Reviewing just a sample of an insurance carrier's commercial book of business can be the first step in an ongoing journey towards more precise underwriting and improved profitability. (Nuthawut/Adobe Stock) Reviewing just a sample of an insurance carrier’s commercial book of business can be the first step in an ongoing journey towards more precise underwriting and improved profitability. (Nuthawut/Adobe Stock)

While small commercial insurers focus on landing new business and hitting growth targets in a fast-paced market, unknown risks can quietly emerge in their renewal book.

First, the initial underwriting submission data may not have been fully vetted and verified. Then, an evolving business may outgrow or drift from the profile that shaped the original policy written, making the initial data go stale by renewal. Finally, auto-renew criteria may lead to loosened underwriting review for several years. For example, a building supply store may diversify its business to include installing hardwood floors, and obsolete data could miss the new risk until it emerges in the form of a claim.

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