Maintaining an accurate, up-to-date Statement of Values (SOV) is important for public entities trying to secure the right property insurance coverage at the best rates for their organization.
An SOV is a declaration to insurance providers of which property your entity intends to insure. In most cases, the document is a spreadsheet with a long list of structures. Each entry includes items like address, GPS coordinates, square footage, number of stories, year built, building description, COPE and Secondary COPE data and ISO Construction Class.
For many entities, maintaining a complete SOV can be a challenge. Unfortunately, missing the mark on an SOV can affect insurance rates and leave some of your property exposed to risk.
Before handing your SOV over to a broker or insurer, ask yourself if what you’ve prepared is completely representative of your property schedule. Here are some things to look for when auditing your SOV:
Gaps in data
Whether it be a lack of Secondary COPE Data or failure to record square footage, missing information on an SOV will raise red flags with an underwriter or insurance provider. Public entities want a good insurance rating, and that’s less likely when data is omitted from an SOV. Before submitting your SOV, verify the data is as complete as possible. More data can mean more accurate insurance coverage.
Missing on accuracy
Maintaining up-to-date, accurate data is key. Precision issues plaguing public organizations may include rounded-up values, ambiguous descriptions or insufficient addresses. Lump entries are another significant problem. A wastewater treatment plant, which resides in open space, is usually a collection of buildings. Some entities will document the plant as one building on an SOV, while each part should have its own entry. Providers also see these problems with schools and parks. Examine your property schedule for accuracy to help ensure your structures are covered in the event of a loss.
A lack of consistency
While accurate information is essential, it’s also key to have consistent data. Putting policies and processes in place for managing your SOV can help with consistency. Building an SOV in a spreadsheet with a group of coworkers presents many challenges with consistency and version control. Leveraging a web-based software solution, accessible by all employees or pool members in real time with approval processes and an auditable history can help ensure the consistency of your property schedule.
Missing pieces
A Statement of Values listing a structure that has long been demolished may mean you’re unnecessarily paying to insure a building. On the other hand, leaving a building off the list can be worse as, in that case, if that building experiences a loss, getting the support and funding needed to rebuild can be difficult. Maintaining an up-to-date and accurate property schedule goes a long way in putting together a complete Statement of Values.
Meeting expectations
Property insurance rates are a reflection of the accuracy and completeness of your organization’s Statement of Values. It’s wise to work with your appraisal partner, broker, underwriter, and/or insurance provider to discuss strategies for securing the best coverage for your organization at the best possible rates. Working as a team can help open up the options available to you and help ensure your buildings and structures are covered in the event of a loss.
Overcoming the challenges of maintaining a complete SOV isn’t impossible and you don’t have to tackle it on your own. Local or state government agencies and risk pools can address the validity of their data by partnering with a third-party property insurance appraisal firm to conduct a review of their SOV and conduct an on-site physical inspection of the buildings and structures you wish to insure. Paired with a software solution for managing all of the data, your organization can feel confident that all buildings and structures are covered in the event of a loss.
For More Information…
And for more information on one solution that bridges the gap between valuation results and valuation management — AMP Property Risk Management Software — click here.