A Video Explaining the Underwriting Concerns About Unacceptable Risks

Posted on November 5, 2020 by Barry Zalma

The Morale Hazard and Unacceptable Risks

See the full video at https://youtu.be/I9FXFTkc_KA

The property owner must understand that some risks are unacceptable under any circumstances to most major insurers. For example:

Vacant property represents an unacceptable risk to many insurers. A critical factor in acceptance is the length and cause of the vacancy and the expectations of the insured for the future. 

If the vacancy is caused by a shift in population or business, or by construction elements that make it unsuitable for most occupancies, or by poor economic conditions, the property may become a burden to the owner that can be “sold” to an insurer by means of a carefully arranged fire or vandalism claim where the fire or vandalism damage is done at the insistence and request of the insured.