Writing Your Appraisal RFP for Property Insurance Appraisal Services

by Greg Friz, Director

Comparing apples to apples, or apples to oranges? As a Director of Accounts at Centurisk, I’ve been involved in our division’s response to numerous RFPs over the years. So I understand the challenges that organizations face when trying to sum up their entire property insurance appraisal needs in document form. Because of this complexity, what an organization might receive from different vendors is not always so easy to compare and contrast. But a well-thought-out RFP for property appraisal services can help with all that. It can ensure the responses you receive are concise, they address your requested needs and ultimately help your RFP preparer (and your RFP respondents!) objectively discuss and review pricing for services.

Some suggested steps to assist you with the appraisal RFP preparation process include…

Highlight Important Details on a Cover Page

Include a cover page with your entity name, RFP name, RFP issue date, date the responses are due and the sequence of events leading to vendor selection. This makes the need, timing, deadlines and process clear so vendors understand what you need and when, and what to expect during the process — making it more likely you get a response containing the elements you need, and on time.

Include Thorough Entity Background Information

Your appraisal RFP should be very detailed and include information on the company’s history, total insured value (TIV), number of locations and quantity of buildings to be appraised. This helps vendors assess your needs more accurately, resulting in a response that is more likely to address the elements you want, and not the things you don’t want.

Develop a Clear Scope of Work

Define the purpose and goals for your RFP. Think about the services you need, the timeline for the project, any rules and procedures that responding vendors are required to follow, a page limitation for the vendor response, any customer references required, compensation details, and your evaluation criteria. The RFP should outline the bidding process and contract terms, as well as provide guidance on how bids should be formatted and presented.

Prepare a scope of work that identifies your project goals, property data collection methodology, valuation methodology, value definition and project deliverables. Make sure to customize the RFP for your goals and objectives, and state them clearly. Some examples could include:

  • A consistent system for allocating member property premiums
  • Accurate values to insurance underwriters for rating purposes
  • Preserve certain coverage enhancements, such as the elimination of coinsurance penalties
  • Provide a database of buildings that are vacant, abandoned, or unoccupied
  • Determine flood zones for each Building or Location
  • Develop content values based on a modeling approach
  • Include Construction, Occupancy Protection, Exposure (COPE) data
  • Provide total insured values, which include not only buildings but also contents and property in the open

By communicating your scope and requirements clearly, vendors are more easily able to address the items you need, and present their information in a format that makes it easier for you to compare and contrast.

Interested in Value-Added Services? This is the Time to Ask!

When you’re creating your proposal, this is the perfect time to request options and pricing for your organization’s “wish list.” This might include property risk management software, supplemental property underwriting data, and loss control data collection services. If you don’t ask, your vendors won’t know to include these value-adds — and may even view them as out of scope.

Don’t Forget to List Your Appraisal RFP Requirements

By creating general guidelines for vendors to follow, you allow for a more consistent response and review process. Request the responses to include:

  • An executive summary
  • Company description
  • Professional staff qualifications
  • References of similar projects
  • Work plan for scope of work
  • Project timeline
  • Deliverables

You may have other elements specific to your organization you might to wish to include here, too, but the items above are the requirements we see frequently.

Share Your Fee Schedule

Include a statement of values (SOV) with the RFP so vendors can base their pricing on the quantity of buildings to be appraised. Request a per-building fee for additional buildings appraised. Proposed fees should include all related expenses including travel.

Get Ready to Compare Apples!

Developing an RPF doesn’t have to be a daunting task. By following the steps above, you gain greater control over the responses you receive, more targeted services — and save yourself some significant comparison time, too.

About the Author

Greg Friz is a Director for Centurisk and resides in Southern California. He and his wife enjoy golfing, biking, and hanging out with their adult children and dog, Lambeau.

Want to see how Centurisk’s AMP Property Risk Management software can help keep you prepared for tomorrow’s big risk challenges? Simply fill out the form below and a member of our team will be in touch!

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