The purpose of this section is to give the reader an overview of risk engineering survey provided to our underwriters and the clients. We recruit the engineers, mostly as members of the property department and engage them in property surveys on behalf of the local underwriting group. The philosophy of risk engineering is to supplement the efforts of the underwriters in realizing the set ‘profit and growth’ by providing technical support to them per se, and by providing value addition to the client’s risk management process. It is often said that the risk engineers are the ‘eyes and ears’ of the property underwriter who needs to underwrite the risk after fully understanding a risk. To put it succinctly the main objectives of risk engineering is to assess the quality of risk and to enable underwriter to write the risk and arrange suitable reinsurance Program. While smaller and not so complex risks can be assessed based on the proposal forms or based on the producer’s report, it will be difficult / unreliable to do so in case of major accounts and the cost of an error in underwriting such major risks would far outweigh the cost of a survey. Remotely assessing the risk without visiting the same is nearly impossible as each risk or account is unique by itself based on the process, the practices and the people. The survey is taken up based on the ‘survey request’ received from the underwriter for both property damage and business interruption risks. The survey intends to serve the underwriter and the client in respect of the following ways.

The survey report is valued by the underwriter for both the above two aspects while the client mainly values the report for the later.

Provision of inputs to the insurer in respects of limits, risk selection and rating is in the scope of survey. Specifically the survey brings out the COPE factors of a risk i.e. Construction, Occupation, Protection and Exposure. Property engineers have to establish the protective measures which are available at a given location and assess their adequacy, quality and reliability in relation to the property being insured. The local codes and laws of the country provide for certain standards and the engineers are to be familiar with such requirements. For underwriting purpose the protection to be checked includes automated sprinkler systems. Fire hydrant systems, Water supplies, Fire alarm systems, Public and or Private fire brigade protection, First aid and other fire protection topics, Special fire protection systems, Inspection and maintenance of the systems etc. Although the survey generally considers protection against fire, property engineers must be alert to other perils like Earthquake, Flood and Cyclone and make a mention in the report.

In another area where the survey helps, is in making the various loss estimates for the risk. The survey report brings out Maximum Amount Subject (MAS), Maximum Foreseeable Loss (MFL) and the Probable Maximum Loss (PML) using the well defined guidelines in our survey manual, combined with the judgment of the inspecting engineer. The loss estimates help the underwriter and the re-insurer to decide the level of retention, cession and the overall underwriting capacity.

Incidentally an enormous amount of useful data is generated during a survey and hence in the long run the survey process would help in settling up a database of all the property risks inspected in the country and would help in deciding the focus area and plan out the business strategies. The de-tariffing of the fire portfolio call, for per se rating of each risk based on the risk factors of individual risk in a competitive manner. This would mean that a risk needs to be necessarily looked at from a risk management perspective and hence risk engineering would be called to play a vital and larger role in a deregulated market. As a visionary insurer we can inspect as many risks in the country and quickly compile a ‘report guide’ which will help in developing a ‘rating guide’ and position ourselves strategically to meet the challenges of competition in the deregulated market.

• Construction - Type of Construction
• Occupancy - The Manufacturing Activity
• Protection - Fire Protection and Safety Measures
• Exposure - Surrounding and Catastrophe
• Process description
• Policy Details - Sum Insured
• Loss History / claims experience

This cover can be bought by the insured engaged in Manufacturing activity and need protection for all risk coverage.