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RiskRatingProcess - ABP0005 v1.2
RiskRatingProcess - ABP0005 v1.2
To provide field associates clarity on how to utilize the new risk rating process when completing an
ALPS report. This will promote quality and consistency of our risk evaluations across the region.
Overview
The Risk Rating System is designed to provide Loss Control, Underwriting and combined leadership a
stratified evaluation system for risks. This process incorporates the objective and subjective elements of
risk assessment to provide underwriting a consistent depiction of risk quality. Each line of business
should be assessed using the following:
2) On the risk report cover page identify the new Evaluation section and complete the
following steps:
a. Remove the overall risk grade once the report template is moved from ALPS
to Word.
b. Select the ratings per line of coverage evaluated. Focus on the 1-4 numerical
ratings since ALPS does not reflect the WRO risk rating names as identified
in this Best Practice.
3) In the Evaluation Narrative section provide a synopsis of the exposures and controls
for each line of coverage evaluated and include the following:
This document is for internal use only and should not be distributed outside of the Nationwide organization.
ABP0005 – Risk Rating Process (Continued)
4) In Word, complete the following steps to replace the system generated ratings:
a. Overwrite the 4-point control rating using the WRO terminology for each
line of coverage rated.
This information is for internal purposes only and should not be distributed outside of Nationwide Insurance
ABP0005 – Risk Rating Process (Continued)
Appendix A
1 - Unsatisfactory
The Unsatisfactory rating is for an account that is clearly well below acceptable criteria
including physical conditions and/or management's attitude towards controlling loss
exposures. No number of recommendations could reform the account to acceptable
levels. The Unsatisfactory rating is also reserved for hazards that create any level of
exposure that is considered inherently uncontrollable. See Exposure Guidelines for
examples of risks that fit into this category.
After a discussion with Underwriting and LC Leadership the following might result
from a risk with an Unsatisfactory rating.
1. The Underwriter will continue to pursue the risk and price for the identified
Undesirable risk characteristics. In this case a full assessment is still required
with recommendations. If coverage is bound, then the Underwriter is
responsible for communicating the recommendations.
2. The Underwriter decides to provide an insurance solution but not for the
Undesirable line of coverage. In this case the report should reflect this decision
in the underwriting comments and the Undesirable Characteristics should be
outlined in the Evaluation Narrative of the report with no further analysis in
the report supplements.
3. The Underwriter decides not to pursue the account at all based on the
Undesirable characteristics in which case the abbreviated Undesirable Risk
Report can be utilized.
This information is for internal purposes only and should not be distributed outside of Nationwide Insurance
ABP0005 – Risk Rating Process (Continued)
3 - Satisfactory
The Satisfactory rating is for an account that is satisfactory for insurance coverage
with adequate physical conditions and management controls in place to reduce losses.
4 - Exceptional
When grading accounts in the field, any account that may seem to fall within the gap between
account grading levels should be placed into the lower of the grading criteria.
This information is for internal purposes only and should not be distributed outside of Nationwide Insurance