The Fac Files – This Time It’s Personal…No, Really
Hi. My name is Tim. I have blue eyes, and I like warm hugs and summer. But then, that’s not really what this blog is about, shameless animated snowman plagiarism notwithstanding.* Casualty Fac is one of those topics that may only come up rarely in the context of an underwriting conversation among commercial lines underwriters. Within personal lines, though, it’s ALMOST unheard of.
Historically, with regard to Facultative, personal lines risks have only been thought relevant for Property Fac for high-value homes. While Property Fac is certainly a useful tool, it’s important to remember that Casualty Fac can also play a valuable role, especially for competitively priced excess personal umbrella limits. There are two myths about Cas Fac and personal umbrellas, which need to be dispelled.
Myth 1: Minimums are too high. We commonly see requests to augment the standard personal umbrella limits with excess limits to satisfy a given insured’s request. (Spoiler Alert: We also write a bunch of these.) Because Cas Fac for commercial business is more common than personal, many assume that our minimums are the same, but the truth is that our personal lines minimums are not only lower than those for commercial, but also competitive enough for us to write a great deal of this business, too.
Myth 2: Fac is a Pain in the #$&! While it’s true that the process of seeking extra protection does in fact require some non-zero amount of very modest effort, most companies find that it is not even remotely as cumbersome as they fear. Add to that the increased efficiencies available from one of our online bundled products, and a company gets the excess limits it needs to compete and hardly notices the veil of Cas Fac that makes those limits possible.
Does your company walk away from excess layers in personal lines because you can’t or won’t quote them? Have you had to ask a great agent to take their request elsewhere?…To a market that may also want a bigger piece of the rest of the insured? If so, give us a call and let’s talk about how Fac for personal umbrella could be a useful tool to grow and defend your best business.
*For those of you without young daughters, this is a reference to Olaf the snowman, from Disney’s "Frozen."