OVERVIEW

ACORD forms are designed primarily for use with insurance products associated with Insurance Services Office (ISO) policies, forms, manual rules and rating plans. While ACORD forms can also be used with the American Association of Insurance Services, Inc. (AAIS) Commercial Output Program (COP) and may be included with any company specific supplemental questionnaires, taking a different approach should be considered when dealing with the COP program.

The COP is not a location-based product. Therefore, most insurance companies will request statements of values to provide detailed information on locations, buildings, business personal property, mobile equipment and other owned property. The ACORD form may also be appropriate, but some companies may require the use of their own COP applications. Any agency that writes numerous COP policies with a single company should consider asking that its management system be supplied with its COP application and forms generator.

The following ACORD forms should be considered for collecting required information. Additional information will probably be requested.

RELEVANT ACORD FORMS

NOTE: Only countrywide forms are discussed here. State specific ACORD forms are not included.

· 125–Commercial Insurance Application–Applicant Information Section

· 139–Statement of Values

· 140–Property Section

· 141–Crime Section

· 143–Transportation Section

· 146–Equipment Floater Section

· 147–Installation/Builders Risk Section

· 148–Electronic Data Processing Section

SPECIFIC FORM CONSIDERATIONS

125–Commercial Insurance Application–Applicant Information Section

All information is relevant and important. Check the appropriate boxes to help the company underwriter understand the lines of business being submitted for consideration. The first named insured and all other insureds must be listed for coverage to apply. Loss information on larger accounts should be submitted in the form of copies of currently valued loss runs for the past five years, as well as for the current year to date. Accurate and currently valued loss information for the last three years is required to compute the Basic Loss Charge on the COP.

139–Statement of Values

This form should list every location the named insured owns, along with the coverages and their insurance to value. Any location not to be covered should be listed and noted so that it can be excluded from the policy. Although this form is not designed to list the excluded properties, it is important for the underwriter to understand the properties that are not to be included in the COP. Additionally, it is good practice for the agency records.

140–Property Section

This form is comprehensive and designed to provide the insurance company with as much relevant information as possible regarding the selected coverages. All the requested information is crucial in the COP deficiency point rating methodology. Inaccurate or incomplete information leads to an incorrectly rated and priced account.

Endorsements needed should be listed in COP format, and value reporting requirements should be clearly identified. A complete list of additional interests, such as mortgages, loss payees, and other lienholders, is needed, along with the details of the property to which their interest applies.

141–Crime Section

Although the coverage provided by the COP Crime Coverage Parts differs from that provided by the ISO forms, properly identifying exposures is crucial in determining the appropriate limits and crime protection measures or devices to employ.

143–Transportation Section

Coverage is automatically provided for property in transit with a $50,000 limit. This application should be used to determine exposures that may require higher limits.

146–Equipment Floater Section

This section is used to determine total equipment values. Each piece of equipment should be listed along with its values. Smaller items may be grouped together with a notation that the value is provided for all items with values of less than $500 or $1,000.

Information regarding lienholders should also be entered in the designated spaces.

147–Installation/Builders Risk Section

This section is used to determine blanket limits for contractors, equipment installers, and millwrights. Mortgagee and lienholder information must be obtained and listed here or on supplemental applications.

148–Electronic Data Processing Section

This section is extremely important because it can help determine whether to include the coverage within the COP blanket coverage or to exclude it and write the coverage on a separate inland marine coverage form.