Have you ever wondered how someone might insure their home made airplane, or the private island they own someplace not even listed on a map? What about celebrity insurance, and Betty Grables million dollar legs?
There are always going to be some people who create, or posses something of unusual value. There will always be a few people so daring that they become an unusual Risk. Not everyone will have legs with a value of a million dollars, but for those who do they will need to find insurance in the “Specialty Lines” market.
Specialty lines insurance markets are a segment of the insurance industry where unusual and difficult to asses risks are taken for consideration of insurance coverage. People needing specialty lines insurance are generally the most unusual and/or highest risks. Specialty lines markets require a high degree of specialization during the Underwriting process. With this type of insurance each insurance Application is carefully reviewed, and the premium is determined by the underwriters. Generally, with specialty lines a Binder is not issued and that applicant will need to wait for the company to determine “if” they are willing to insure the risk and for what premium.
The insurance company will rely on the skill of the underwriters who may work with other specialized Actuary experts and claims Adjusters to assist in determining what premium rates will be charged for the special line of insurance. I always like to think of it as customized insurance policies and special orders almost always cost a little more, and take time to receive the finished product.
Not all insurance Agents, Brokers or even insurance companies offer customized or speciality lines of insurance. The Insurers and insurance companies who do consider special lines of insurance usually specialize and may focus on certain areas of expertise and experience. An underwriter for a speciality lines of insurance would need expertise in the risk being considered for insuring and the ability to rate insurance for a wide number of risks.
Speciality lines insurers typically work with insurance brokers who are trained and experienced with specialty lines insurance needs and issues. A great deal of insurers depend on the brokers to help with product development in order to offer better protection for the insureds.
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