CONDITIONS OF RISK UNDERWRITING
REPRINT FROM THE INTEGRAL NEWSLETTER
Although this art has been around since the creation of insurance, it is not routinely done today for property risks.
A building has to have a controlled balance of temperature, moisture, and pressure to function normally. Not only do the occupants of the building affect the balance, so does the environment, the building use and services, and the protective coat surrounding the building commonly called the envelope.
Hidden conditions that exist, that are not observed or declared, can affect an insured loss at a later date, not only in the extent of damage, but to the cost to restore the damage as well.
These conditions can be found in the landscaping, in the structure, in the exterior walls, in the roofs, in the basement, in the attics, in the heating system, in the plumbing system, in the electrical system, in the occupancy areas, and in the security features. Standard underwriting inspections do not necessarily reveal these exposures.
POOR CONDITION means that the building is not functioning correctly.
AVERAGE CONDITION means that the building is functioning but not to its fullest capacity.
GOOD CONDITION means that the building is functioning to its fullest capacity and is actually in a loss prevention mode.