Services

Lenders Insurance Review

We believe insurance due diligence should be addressed before a loss occurs.

Our unique approach toward our clients interests brings the focus to insurance due diligence.

Our goals are to ensure that the lenders' insurable interests are properly executed, to identify any obstacles to a full recovery of the lenders' insurable interest(s) and to provide the lender with recommendations that would rectify or mitigate such obstacles before a loss occurs. Understanding the terms and conditions of your borrower’s insurance contracts (policies), along with your rights and obligations as a secured lender under these policies, is as important as understanding the terms and conditions of the financing agreement between you and your borrower.

Our team works in an independent atmosphere of technical experience and confidentiality that can be tailored to fit the needs and requirements of even the largest and most diverse lender. Our flexibility lets you choose the review’s focus and to tailor the end product to meet your specific needs.

The scope of our Lender Insurance Reviews can be limited to insurance compliance issues in which we can assist in obtaining and reviewing required insurance documentation to ensure that the lenders insurable interests are properly documented. Different risks present different concerns. In a more complex situation, comprehensive services are also available.

Some of the notable issues identified in our more comprehensive reviews include:

  • Adequacy of Loss Limits for Subject Property vs. Concentration of Risk
  • Structure of Program — Concurrence of Coverage in a Layered Insurance Program
  • Catastrophic Perils and the Adequacy of specified Sub-Limits
  • Exclusions and Anti-Concurrent Causation Provisions

Our goal is to ensure that your borrowers insurance program provides the primary coverage as expected under the financing agreements. Although most lenders do have Mortgage Contingency and/or Contingent Property Provisions in their corporate insurance policies, such coverage is never meant to be primary. The coverage trigger for these “contingent” provisions is, most often, a “failure of the borrower’s insurance to respond to a loss.” Oftentimes, a condition of these “contingent” provisions is that, upon knowledge of lapse or absence of the borrower’s insurance, the lender will be forced to place such lapsed or missing insurance. Therefore, the lender has an inherent duty to ensure there is underlying insurance in place to recover under the “contingent” provisions of its corporate policy.

Our lending clients have selected us over other nationally known insurance consultants due to our independent options and broad range of lending and commercial insurance knowledge. We have the expertise of former lenders, which can help bridge the gap between the lending and insurance contracts. Our broad scope of knowledge in both finance and insurance differentiates us from our competition, allowing Commercial Insurance Consultants to prepare your business for future success.

Our services include:

  • Insurance Due Diligence aimed at supporting the lending process through the review and analysis of borrowers insurance programs.
  • Assistance in identifying and obtaining binding documentation supporting the lender’s insurable interests under its borrowers insurance program.
  • Ongoing Insurance Due Diligence, including annual monitoring of borrowers program and assistance in addressing potential coverage or exposure issues that could adversely affect the lender and/or its borrower. 
  • Protecting lenders from unforeseen insurance risks their borrowers may have, while still maintaining the integrity of the underwriting process.
  • Preserving the lender’s ability to collect insurance proceeds in the event the insured breaches its responsibilities.

Call or e-mail us today to discuss your situation and receive our preliminary suggestions at no obligation.