Risk Differentiation – A Strategy to Differentiate Without A Difference
Posted on June 23, 2010 in Underwriting - Risk Differentiation
In special risk underwriting, the concept of “all cases are not created equal” is only true if one comprehends the realities of Risk Differentiation. In analogous terms, Risk Differentiation, can be compared to the equal but different paintings of two artists. They begin with the same ability, similar canvas and brushes, equal paints, and the same subject on which to base their work. Yet, when finished, one piece hangs at the Metropolitan Museum of Fine Art and the other in the reception area of a small life brokerage agency. Why?
The subtle strokes which dispel vagueness or confusion and instill clarity and completeness can often dictate an artist’s success. Similarly, the ability to recognize special risk cases which merit differentiation combined with the foresight necessary for Risk Differentiation, can often lead to inspiring underwriting results.
The purpose of this article is to introduce you to the field of Risk Differentiation and moreover to illustrate its usefulness within the realm of special risk underwriting.