Having started her career as an underwriting administrator at Strata Unit Underwriters (SUU) in her late 20s, Lillian Zhou had the opportunity to work alongside the claims team.
There, she witnessed the personal impact of properties being incorrectly insured and claims being denied.
‘I was determined to become an underwriter who helped educate and explain how underwriters assess properties when insuring them,’ Zhou says.
HIGH LEVEL OF SKILL
Zhou, who is the inaugural winner of ANZIIF’s Making A Difference Award — Underwriting, always wanted to be a strata underwriter, due to the high level of skill required and the variety of properties to deal with.
Having been promoted to underwriting assistant at SUU, she soon became an underwriter with authority for both commercial and residential property.
After 10 years at SUU, Zhou decided it was time for a new challenge and in 2020, joined the Flex Insurance team as senior underwriter.
‘Flex Insurance was just one year old at the time, so my role as the senior underwriter involved the development of processes, building relationships with brokers, nurturing and growing the underwriting team and building product knowledge and capability,’ she says.
AN UNUSUALLY PRICY PREMIUM
Recently Zhou was underwriting a new business policy that seemed unusually expensive for its size, age, location and COPE [construction, occupancy, protection and exposure] details. In addition, the building was free of asbestos and cladding.
‘I reviewed the policy details and compared them to similar buildings in the same area to validate my thoughts,’ Zhou shares.
‘Upon further review, I determined that the policy’s extra cost was due to a disclosure of slate tiles for the roof construction.’
Based on her experience in underwriting strata properties, Zhou reasoned that given the building’s details, it was unlikely that slate tiles would have been used in the construction of its roof.
She Googled the property, which confirmed her belief that the roof tiles of the building insured were probably not slate.
‘I then contacted the broker’s assistant and provided my research, including photos of the building and descriptions of different tile types to validate my opinion that the roof construction disclosed was incorrect,’ Zhou says.
The broker’s assistant admitted that she had selected slate tiles because the customer was not sure what the tiles were made of.
‘She (the broker’s assistant) had assumed that if the policy said slate tiles, it would be better for the client because they are a more premium product and in the event of a claimable loss, the original tiles would be upgraded to slate.’
Zhou explained the importance of disclosing the correct information — that in the event of a loss, a claim could be denied if the building’s details are incorrect.
She also took the time to educate the broker’s assistant on how risks are assessed and the insurance practice of restoring a property to its pre-damaged condition which precludes the upgrade of materials.
GETTING THE FACTS
The broker then called Zhou requesting more information about slate tiles.
‘I provided details on the differences in appearance between slate and non-slate tiles and reiterated that incorrectly selecting the more premium product could result in a claim being denied and a higher premium for the customer,’ Zhou recalls.
With the strength of this knowledge and information, the broker returned to the customer and succeeded in confirming that the tiles were not in fact slate, but terracotta. This resulted in a 35 per cent premium reduction for the client.’
A TEST OF ABILITY
Both the customer and broker thanked Zhou personally for educating them and ensuring the property was insured correctly at a more affordable premium.
‘Strata is a true test of an underwriter's ability,’ says Zhou of her work.
‘As someone who loves our industry, I try my best every day to help customers understand an important but complex product.’
Confirmation comes in the form of positive feedback from one of Zhou’s Sydney-based broking partners.
‘When it comes to hard-to-place risks, I often get straight declines from underwriters,’ the broker says, ‘but Lillian is different.
‘She thinks of the customer and will make time to explain what the challenges of the risk are and detail what can be done to get cover or lower the premium.’
We look forward to recognising outstanding insurance professionals in the sectors of broking, general insurance and claims later in the year. Entries for these sectors will open on Tuesday 17th August 2021.