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Lessors Risk Only. TWFG Commercial Business School Lessors Risk Only. Learning Objectives To understand the basic Commercial and Habitational LRO risk exposures To be familiar with the common coverages provided in carrier enhancements for this class of business

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twfg commercial business school lessors risk only
TWFG Commercial Business SchoolLessors Risk Only

Learning Objectives

To understand the basic Commercial and Habitational LRO risk exposures

To be familiar with the common coverages provided in carrier enhancements for this class of business

To be aware of the admitted market appetite for this class

To be able to successfully complete ACORD applications

twfg commercial business school lessors risk only1
TWFG Commercial Business School Lessors Risk Only

Glossary

LRO (Lessors Risk Only)

Vacancy

Preferred Lease Contract

Lessor’s Leasehold Interest

Ordinance or Law

twfg commercial business school lessors risk only2
TWFG Commercial Business School Lessors Risk Only

Exposures in General

General Liability Property

Housekeeping Age & Condition

Additional Insured Status Roofs & Electrical

Types of Tenants Types of Tenants

Vacancy

twfg commercial business school lessors risk only3
TWFG Commercial Business School Lessors Risk Only

Business Income

When choosing Business Income, the insured must select one or more of the three options. Those with “Rental Value” apply for LRO risks:

Business Income including “Rental Value”

Business Income other than “Rental Value”

“Rental Value”

twfg commercial business school lessors risk only4
TWFG Commercial Business School Lessors Risk Only

Carrier Enhancements

Fairly generic. Most offer some additional limits on specific coverages such as:

Ordinance or Law

Debris Removal and Utility Services-Direct Damage

Coverages of Note:

Tenant Move Back Expenses

Lessor’s Leasehold Interest

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TWFG Commercial Business School Lessors Risk Only

Carrier Appetite

Habitational:

Very little appetite in the admitted markets

Some appetite for Apartments, but guidelines are tough and no Tier 1 or Tier 2 availability

Some rental dwelling capacity with USLI

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TWFG Commercial Business School Lessors Risk Only

Carrier Appetite

Commercial LROs:

Some appetite in the admitted markets. Bank or Office LROs are acceptable to most our carriers

Some appetite for commercial condos (business occupancy) and manufacturing LROs

twfg commercial business school lessors risk only7
TWFG Commercial Business School Lessors Risk Only

Preferred SIC Codes

All preferred risks in this category fall under SIC code 6512

Support Document Located on the Branch & GA websites

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TWFG Commercial Business School Lessors Risk Only

Submission Checklist

A submission checklist is the easiest way to ensure that all exposures have been accounted for and addressed

Support document is available on the Branch & GA website

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TWFG Commercial Business School Lessors Risk Only

Case Study

This segment includes a Case study. For those Branches participating in the Certified Commercial Branch Agency (CCBA) Program you will need to complete and pass in order to receive credit for this segment. For Branches not participating, the Case Study is optional

For GA agents the Case Study is optional.

The Case Study material will be available on the Branch and GA portals

RETURN COMPLETED CASE STUDIES TO MARK GLAUG @

mglaug@twfg.com

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TWFG Commercial Business School Lessors Risk Only

1. Name three critical exposures (GL or Property) that need to be analyzed for this class of business.

twfg commercial business school lessors risk only12
TWFG Commercial Business School Lessors Risk Only
  • Name three critical exposures (GL or Property) that need to be analyzed for this class of business.

Age and Condition of Building

Tenants

Roof

Vacancy

Housekeeping

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TWFG Commercial Business School Lessors Risk Only

2. Name three of the four preferred elements of a landlord lease contract.

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TWFG Commercial Business School Lessors Risk Only
  • Name three of the four preferred elements of a landlord lease contract.

Each tenant carries CGL form “A” rated carrier with $1M/$2M

Landlord listed as AI on all tenants’ CGL policy

Landlord granted WOS status on each tenants’ CGL policy

Each tenant provides COI and AI endorsement to the landlord

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TWFG Commercial Business School Lessors Risk Only

3. What is Ordinance or Law coverage?

twfg commercial business school lessors risk only16
TWFG Commercial Business School Lessors Risk Only

3. What is Ordinance or Law coverage?

It covers the increased cost of repairs or reconstruction due to changes in building codes that were not in place at the time of the original construction.

twfg commercial business school lessors risk only17
TWFG Commercial Business School Lessors Risk Only
  • Name 3 critical items from the LRO Submission Checklist
twfg commercial business school lessors risk only18
TWFG Commercial Business School Lessors Risk Only
  • Name 3 critical items from the LRO Submission Checklist

Dates and details of updates

Complete square footage information

Complete tenant listing

Verification of preferred lease contract components

Verifying that a current sprinkler cert has been issued

Analysis of all additional property coverages needed

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TWFG Commercial Business School Lessors Risk Only
  • How will the carrier view the tenants’ operations in regards to acceptability of the risk?
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TWFG Commercial Business School Lessors Risk Only
  • How will the carrier view the tenants’ operations in regards to acceptability of the risk?

The carrier will likely only write the risk if all of the tenants are classes of business that the carrier would also write