Above a certain size, commercial insurance stops being priced from a form and starts being priced from a visit. A surveyor, sent by the insurer or arranged by the broker, walks the premises, and what they record shapes the terms, the conditions and sometimes the insurability of the risk. The timing varies. Some surveys happen before terms are offered, but many are undertaken after inception: the policy has already been priced and cover bound by the insurer, with a survey requirement applied at inception, and in the weeks and months that follow the insurer’s risk management team visit to confirm the business is operating at the level the underwriter expected.
What the surveyor actually records
In our experience the visit starts around a table rather than on the factory floor. The surveyor will usually want to sit down with the decision makers, the owner or the head of operations, to understand the business: its background and history, how long it has been at the premises, how many staff work there, and a high-level view of the operation, where raw materials come from, who the products are sold to, and what contracts are in place.
The paperwork comes next: maintenance contracts for the alarms, a fire risk assessment that is in date, evidence that risk assessments are actually being undertaken, and, where hot works take place, a hot work permit system that is genuinely in use.
Then comes the walk round, where the survey builds its picture in layers. Construction first: what the building is made of, its age, its roof, and whether it contains combustible composite panelling, which insurers treat with particular caution. Then protections: fire alarms and where they signal to, extinguishers and their servicing, sprinklers if any, physical security, intruder alarms, CCTV. Then the processes: anything involving heat, from hot work to frying to charging banks of batteries; how flammable materials and waste are stored and how often waste is cleared; how stock is racked, how high, and how far from lights and heaters. And throughout, the surveyor is closely monitoring the business’s housekeeping. A tidy site with clear aisles, managed waste and maintained kit tells an underwriter a lot about how the business is run.
Risk improvement requirements and recommendations
Surveys produce two different outputs, and the two are not the same. Some findings become risk improvement requirements: specific changes the insurer requires, each with a date by which it must be implemented. A deadline can often be extended by negotiation where the insurer can see genuine progress being made towards the change. Other findings are recommendations, which do not have to be implemented at all: they are good risk management advice from the insurer, and nothing more.
The distinction matters because a survey risk improvement requirement can restrict or void the cover it relates to if it has not been complied with within the timescale set out and an extension has not been agreed, and the moment that is discovered is invariably during a claim. As a broker, we can assist with negotiating risk improvements when they are first imposed, and with negotiating the timescales and any extensions with the insurer.
What moves the terms
Underwriters price what they can see, and the same physical risk can be priced very differently depending on how it is evidenced. Documented maintenance, alarm servicing contracts, staff training records, a fire risk assessment that has clearly been acted on, claims from past years with the lesson learned and the fix visible: each of these converts an assertion into evidence. This is also where a broker changes the outcome, because the presentation of a risk to the market, the pack an underwriter reads before quoting, decides what the market sees. The same business, presented as three lines on a form or as a documented, managed operation, receives two different sets of terms.
Preparing for one
Preparation is mostly assembly rather than works. Have to hand: the fire risk assessment and evidence of actions taken; alarm and extinguisher service records; electrical installation and PAT records; details of any hot work controls; waste arrangements; and an honest list of what you already know needs attention, because a surveyor finding an issue you have already scheduled reads very differently from a surveyor finding it unacknowledged. Walk the site the week before as if you were the visitor, because what you find is the evidence of management the surveyor is there to see.
We attend surveys with clients where it helps, and for our commercial clients we often undertake our own site visit first, so the presentation to the market leads with the strengths a surveyor will later confirm. Our commercial combined insurance page explains the cover this most often relates to, or speak to the commercial team about a review.
