Download - Lessors Risk Only
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FG C
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ercial Business School – L
essor’s Risk
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Lessors Risk Only
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FG C
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essor’s Risk
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TWFG Commercial Business SchoolLessors Risk Only
Learning Objectives
To understand the basic Commercial and Habitational LRO risk exposures
To be familiar with the common coverages provided in carrier enhancements for this class of business
To be aware of the admitted market appetite for this class
To be able to successfully complete ACORD applications
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FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
Glossary
LRO (Lessors Risk Only)
Vacancy
Preferred Lease Contract
Lessor’s Leasehold Interest
Ordinance or Law
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FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
Exposures in General
General Liability Property
Housekeeping Age & Condition
Additional Insured Status Roofs & ElectricalTypes of Tenants Types of Tenants
Vacancy
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FG C
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essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
Business Income
When choosing Business Income, the insured must select one or more of the three options. Those with “Rental Value” apply for LRO risks:
Business Income including “Rental Value”
Business Income other than “Rental Value”
“Rental Value”
TW
FG C
omm
ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
Carrier EnhancementsFairly generic. Most offer some additional limits on specific coverages such as:
Ordinance or LawDebris Removal and Utility Services-Direct
Damage
Coverages of Note:Tenant Move Back ExpensesLessor’s Leasehold Interest
TW
FG C
omm
ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
Carrier Appetite
Habitational:Very little appetite in the admitted markets
Some appetite for Apartments, but guidelines are tough and no Tier 1 or Tier 2 availability
Some rental dwelling capacity with USLI
TW
FG C
omm
ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
Carrier Appetite
Commercial LROs:Some appetite in the admitted markets. Bank
or Office LROs are acceptable to most our carriers
Some appetite for commercial condos (business occupancy) and manufacturing LROs
TW
FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
Preferred SIC Codes
All preferred risks in this category fall under SIC code 6512
Support Document Located on the Branch & GA websites
TW
FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
Submission ChecklistA submission checklist is the easiest way to ensure that all exposures have been accounted for and addressed
Support document is available on the Branch & GA website
TW
FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
Case StudyThis segment includes a Case study. For those Branches participating in the Certified Commercial Branch Agency (CCBA) Program you will need to complete and pass in order to receive credit for this segment. For Branches not participating, the Case Study is optional
For GA agents the Case Study is optional.
The Case Study material will be available on the Branch and GA portals
RETURN COMPLETED CASE STUDIES TO MARK GLAUG @
TW
FG C
omm
ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
QUIZ
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FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
1. Name three critical exposures (GL or Property) that need to be analyzed for this class of business.
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FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
1. Name three critical exposures (GL or Property) that need to be analyzed for this class of business.
Age and Condition of BuildingTenantsRoofVacancyHousekeeping
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FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
2. Name three of the four preferred elements of a landlord lease contract.
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FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
2. Name three of the four preferred elements of a landlord lease contract.
Each tenant carries CGL form “A” rated carrier with $1M/$2MLandlord listed as AI on all tenants’ CGL policyLandlord granted WOS status on each tenants’ CGL policyEach tenant provides COI and AI endorsement to the landlord
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FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
3. What is Ordinance or Law coverage?
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FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
3. What is Ordinance or Law coverage?
It covers the increased cost of repairs or reconstruction due to changes in building codes that were not in place at the time of the original construction.
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FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
4. Name 3 critical items from the LRO Submission Checklist
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FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
4. Name 3 critical items from the LRO Submission Checklist
Dates and details of updatesComplete square footage informationComplete tenant listingVerification of preferred lease contract componentsVerifying that a current sprinkler cert has been issuedAnalysis of all additional property coverages needed
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FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
5. How will the carrier view the tenants’ operations in regards to acceptability of the risk?
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FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
5. How will the carrier view the tenants’ operations in regards to acceptability of the risk?
The carrier will likely only write the risk if all of the tenants are classes of business that the carrier would also write
TW
FG C
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ercial Business School – L
essor’s Risk
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TWFG Commercial Business School Lessors Risk Only
Questions???