Your Checklist for Writing an Effective Underwriting Cover Letter
Tracy Cooper, ACS, FLMI
Creatively negotiating the underwriting of large life insurance cases, complex medical impairments, and challenging financial risks.
If you’ve had an important insurance case ready to submit to underwriting, you know how stressful it can sometimes be to write your cover letter. While you want to help the underwriter understand your client's specific circumstances, it's tough to decide what information to include and what information could be counterproductive.
An effective cover letter can help your policies get approved quickly at the desired rate class, while a poorly written cover letter can start the case off on the wrong foot and cause confusion. In my work with hundreds of top insurance producers, I’ve perfected the art of crafting a cover letter that gives context, avoids confusion, and helps get your clients’ policies approved quickly.
What is the Purpose of a Cover Letter?
Cover letters are meant to offer context for the underwriter, who is just being introduced to the specifics. Without enough information, underwriters often jump to their own conclusions about a medical condition or financial issue, which may take much more work to undo than it takes to explain the specifics up front.
What to Include in Your Cover Letter
Depending on the type of case, you’ll want to be sure to include appropriate data points that the underwriter will find pertinent. For business cases, financial information is key. For personal cases, establishing the purpose of the insurance is important. For all cases, explaining any special circumstances is imperative to help the underwriter get to know your client as well as you do. Below are cover letter checklists for each type of case.
Business Case Information to Include
- How many business partners are there in the firm?
- Are all partners being covered? If not, why not?
- For key man coverage, what specifically makes this person a “key” employee?
- For cases with special circumstances, what are the history and specifics? (Example: A recent purchase of the company)
- Has the company had a significant change in revenue recently?
- How was the face amount determined?
- Explanation of any medical conditions
- What are the special circumstances and background?
Personal Case Information to Include
- What is the purpose of the policy? (Examples include estate planning, final expenses, etc.)
- What are the special circumstances and background?
- How was the face amount determined?
- Explanation of any medical conditions
- What is the insurable interest of the beneficiaries?
- What is the total amount of insurance to be in force?
- Is the client applying for insurance with any other carriers? If so, what is the total line to be placed with all carriers?
If You Need Help
Drafting an effective cover letter can be challenging if the process is not part of your regular routine. If you have questions, need help, or would like to see examples of effective cover letters, please email me at [email protected] or call me directly at (562) 735-5142.
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8 年Thank you Tracy Cooper for your tips on writing effective cover letters! It's so critical for the sophisticated business and estate tax cases you look after every day. Thank you for sharing your expertise!