As you begin a career in insurance, it will be critical that you develop a familiarity with applications used in the Agency Management System (AMS). Continue reading for more details on the applications you will be using every day to manage client information.
What Are Acord Forms?
ACORD forms are universally recognized documents that contain information which most, if not all, insurance carriers require to be completed in order to provide a quote back to the agency. There are several Acord forms and each serves a purpose specific to the type of coverage that it represents. Of all of the forms, however, the first one you will see is the Acord 125.
What is an Acord 125 form?
The Acord 125 form is more commonly known as the Commercial Insurance Application. This application is used to record general client information including things like business location and contact details, business description, prior insurance and loss history.
You may be looking at this and wondering if you need to know how to fill out accord 125? The answer is, yes! This application is used on almost every commercial insurance policy so it is important that you understand how to complete an Acord 125.
Let’s look over a few key points in the form that you will want to make sure you pay attention to when completing the Acord 125:
Page 1 will focus on the basics the company needs to begin the underwriting or rating process.
The very beginning of the form requires the agency details. The Agency Management System will most likely fill this information in for you, but if completing outside of an AMS, be sure manually enter the required details.
On the right-hand side of this section you will also find a box for the Status of Transaction. If you are preparing this application to be submitted to the carriers with others you will want to select “quote.”
The next section you will want to review is the Lines of Business area of the form. Take a moment to look over the policy options listed and check all that apply for the insured.
Moving along to the Policy Information, be sure to indicate the effective and expiration dates (when will the policy begin and end), the billing plan noting whether the insured or the agency will be billed for the premium as well as what payment plan the client has selected. You will also see a box in this line for Audit which is used to indicate how often a policy will be audited. An annual audit is most common so you can enter an “A” in this section.
Next, on the form is the Applicant Information. In this section, you will enter Named Insured along with their mailing address, FEIN (Federal Employer Identification Number) or Social Security Number (for individuals only) and the insured’s main business phone number. You’ll also want to check a box indicating the business type. IF there are other named insured’s that need to be named on the policy, be sure to enter that information as well.
Page 2 will get into a little more detail about the business operations, but be sure to complete the Contact Information section at the top of the page before moving on. You will want to be sure to
include the contact type, contact name and phone number.
The next section you will find on Page 2 is the Premises Information. This is where you will enter the Location and Building Number (start with #1), the address for the location and building as well as other details indicating whether the location is inside or outside city limits, whether the insured is an owner or tenant of the location and the number of employees. The remaining rows in this section will be for revenue and square footage specifics including annual revenues, square footage for the occupied area, open to public area and total building area as well as confirmation whether or not part of the premises is leased to others. All this is used to help determine the insured policy premium.
Once you have completed the Premises Information you will need to enter the Nature of Business details. In the first part of this section you will need to check a box next to the category that matches up with the insured’s business type. In the area below, you will want to provide a description of the insured’s operations.
As you move through Page 2 you will next find the Additional Interest area. This is where you will want to enter information for any party that has an interest in the insured’s business. Check the box that applies and enter the name and address for the additional interest.
Page 3 is primarily used to gather General Information. There are a series of 15 questions on this page which you will want to make sure you complete by indicating “yes” or “no” in the right-hand column. Some questions may require additional detail for any “yes” answers so be sure to include all necessary information
At the bottom of this page you will come to the Prior Carrier Information. In this section you will need to enter prior coverage details including Year, Carrier Name, Policy Number, Premium history for applicable lines of coverage and effective and expiration dates of the policy.
This Prior Carrier Information is continued on Page 4 providing you spaces for additional carrier history. As you move down Page 4 you will come to the Loss History section. In this spot you will either need to check “no” if they did not have any claims in previous policy periods OR fill out the claims detail requested.
The end of page 4 provides spaces for signature from the Producer and Insured. These will not be required during the quoting process, but will need to be obtained when the policy is bound.
Other Important Notes:
An Acord 125 fillable form (as well as other Acord forms as well as other Acord forms like the Acord 130) should be available in your Agency Management System. You can complete the form and then send an Acord 125 PDF to the client to review and sign.
Some of the details reviewed will pre-fill in your AMS. This will save you time when completing the Acord 125 form.