Get Homeowners Value Right
To The Editor:
In his May 28 “Financial Insights” column, “Price Hikes Needed In Homeowners Market,” Sean Mooney of Guy Carpenter & Company in New York correctly highlights the poor homeowners results over the past several years.
Mr. Mooney suggests that the only response to this problem is incremental rate increases. He may be correct. Perhaps rate increases are in order.
There is, however, another course of action that should be considered–accurate insurance to value.
The industry should take the time to properly underwrite and assign an accurate value to a risk at the inception of the policy. If all homes were physically inspected for insurability and the correct Coverage A determined from the start, premium dollars and profits would rise without a rate increase. Inevitably claims would also be reduced by increased scrutiny of the risk.
A properly managed underwriting program is money well spent and will show positive dividends for many years to come.
Edward Coan
General Partner
CIG Property Inspections, LLC
Toms River, N.J.
Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, September 10, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.
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