Risk

The Loss

So that was most of what underwriters do: consider which risks to get and which ones to keep by renewing. The rest of what they do all day is worry that the risks they have selected will have a big claim and they will be hauled onto the mat to answer for it. Consider risk and worry for a living. Nice work if you can get it. Martin shook his head and tried to concentrate on the claim report.

The date of loss was Sunday, so it had been the previous night. It was a professional hit. The line to the alarm monitoring station had been cut and the bars had been taken out along with the window, which was removed in one piece from the frame. The place was a mess and the only things missing were plans and blueprints from a current job. There would be a payout under “Valuable Papers” and a Business Interruption loss while the plans were reassembled. They would have to pay to have the line repaired and the window replaced. Nothing else stolen or destroyed. That didn't sound right.

This one had disaster written all over it from the start. He remembered when the phone call had come in from the broker, only a week ago, and it hadn’t passed the sniff test from the start.

“Hi, Martin. Listen, I’ve got a piece of new business for you. It’s a machine shop. Do you think you could do it for four thousand bucks?”

“Let me take a look at it. Put some details on paper and fax it over.”

“Can’t you just quote me over the phone?”

“Well, what do they make?”

“Just various metal products.”

“It makes a difference to what we would charge. And I’ll also need construction and protection details on the building to determine the property rate.”

“It’s HCB, steel deck roof, of course. What else? I’m a busy man, Martin. I don’t have time to get into all this detail.”

“I can’t quote over the phone. I’ll need something in writing. Including receipts. Do they sell to the U.S.?”

“What do you think? Everybody sells to the U.S. This is just a little risk, I don’t see the big deal.”

“Sales to the U.S. increases our exposure. You’d better send something over.”

“I’ll get back to you.”

Unbelievable, was his first thought when he had hung up the phone. What do we even need underwriters for, if that’s the way we’re going to deal in insurance? It’s not about the size of the building they occupy, or the number of people they have working for them, their level of training and qualification, or who they sell their products to, or how much they sell, or how much equipment they have and what it costs to replace it, would a key piece of equipment shut down the whole shop while it was being repaired, or whether they deal in cash or credit, or how long a fire would put them out of business, or ten or fifty other things that Jed Johansen wouldn’t think to ask... it’s about a few thousand bucks and a quick sale. Granted, 99% of brokers were diligent and professional and trustworthy, but it was the ones like Jed Johansen that you had to watch or else you ended up in situations like the one he was currently facing.

Jed never did send in a full quote submission, he just went over Martin’s head and spoke to Gerry. “Gerry” was short for Geraldine, his supervisor. She preferred the diminutive, as she didn’t live in the Victorian age. She was tall and confident and blond, and Martin found her easier to deal with than his previous boss. She had an intelligent face and sharp eyes. She was impatient all the time, but kind. From looking at the pictures on the desk of her husband and kids, he imagined she was one of those busy moms who were great with their kids, efficient at work and able to keep the whole world spinning on the end of a stick.