SAN DIEGO — Construction risk managers and their brokers can obtain better and faster insurance quotes when they put in the work to send underwriters well-researched submissions before negotiations begin, a panel of experts said.

But even with submissions that are carefully presented, buyers should start on their submissions at least four months ahead of their proposed inception date. With a long lead time, underwriters are able to properly assess complex risks and reach a comfort level where they can offer competitive quotes, they said.

The optimal time for a successful submission of a risk to an underwriter is 120 to 150 days ahead of the coverage period, said Joseph Russo, New York-based senior vice president and regional practice leader of Aon Risk Solutions' construction services group, during the International Risk Management Institute Inc.'s 33rd annual Construction Risk Conference in San Diego.

The key point that risk managers and their brokers have to remember when preparing their submissions is that “the submission has to tell the story of the risk to the underwriter,” he said.

The process begins when the broker meets with their construction firm client to go over coverage needs and details such as where the risks are located, what's the schedule for the construction project and details on the client's operations, Mr. Russo said.

Then the broker can prepare the executive summary of the risk for the underwriter. “The executive summary is a brief outline of the risk, and the key word is brief … it should be short and cogent and hit the highlights of the project,” he said.

Next, the broker should compose a summary sheet of dates that need to be met for the insurance program and detail names of locations, lines of coverage requested, limits requested, a description of operations and other details on the exposures, Mr. Russo said.

A key component of the submission is information on the client's loss history. Typically, underwriters are looking for at least a five-year loss history, though most would prefer to see loss data going back 10 years if it is available, he said.

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The broker then contacts the prospective underwriters to alert them to the submission and talk them through the highlights to ensure that they prioritize the submission when they receive the final documents, Mr. Russo said.

When underwriters receive submissions, they begin work with four key staff members to assess the risk, said Stephen A. Buonpane, New York-based vice president of construction at Ace USA, a unit of Ace Ltd.

“They are trying to coordinate a game plan,” he said.

First, the submission is reviewed by an underwriting assistant, who checks key facts, such as names, addresses, payroll information, the proposed duration of the project and limits requested, Mr. Buonpane said.

“You really can't get started on the underwriting side without getting feedback from the underwriting assistant,” he said.

Next a risk engineer reviews the submission. “I can't stress how important the risk engineer is in this process, particularly for construction risks … These are the guys that you need to pander to,” Mr. Buonpane said.

Risk engineers are the “eyes and ears” of underwriters and know which companies have the best safety procedures, he said. The feedback from the risk engineers can make the difference between a conservative pricing quote and a competitive quote.

The risk is then reviewed by a credit analyst, who helps determine required collateral levels for high-deductible programs, and then by a claims account manager, who provides claims pricing proposals.

When the feedback is collected, underwriters can then evaluate the risk on technical issues, such as retention levels and program structure, and expense issues, such as service costs, taxes and surcharges. Then the risk can be evaluated by an actuary, Mr. Buonpane said.

The broker can then assist with answering any questions the underwriters may have on the risk, said Aon's Mr. Russo, and the underwriter will be in a position to issue a quote.

Although the process can be lengthy, risk managers should be aware that “underwriters are in the business of winning business. We don't like to work on quotes and not get the business, but I need to sell my manager that it's a good risk,” Mr. Buonpane said.

Business Insurance's digital coverage of the 2013 IRMI Construction Risk Conference is sponsored by Ace. To view all the Digital Daily news and related content in its ideal form, use a nonmobile browser to visit www.businessinsurance.com/IRMI2013.