Comparative Rater or Bindable Quote: What's the Difference?

Independent agencies have used comparative raters for a long time, and for good reason: they show a producer, quickly, roughly where a client will land across several markets. But a rater's number and a bindable quote are different things, and the difference shows up at the worst possible moment: after the client has said yes.

What a comparative rater gives you

A rater takes a set of answers about the client and returns estimated premiums from the carriers it is connected to. It is fast, it is consistent, and it is a good way to decide which markets are worth a closer look.

What it gives you is a price based on the rater's version of the questions.

What a bindable quote is

A bindable quote comes from the carrier's own application, completed with the carrier's own questions, the required consumer reports ordered where the carrier calls for them, and the producer's affirmations in place. It is the number the carrier is prepared to bind.

The two can differ, sometimes by a lot:

• The carrier's application asks questions the rater never did, and the answers move the price.
• Reports come back with something the client forgot: a claim, an incident, a lapse.
• The carrier's underwriting rules decline or restrict the risk outright.

Why the gap matters

For the client. A client who was shown a rater's number and then hears a higher price at binding feels misled, even when nobody did anything wrong. Trust is hard to win back after that call.

For the producer. Re-working a quote after the client has agreed costs more time than doing it right the first time, and it usually happens at the end of a long day.

For your E&O. The application is the carrier's record of what your agency told it. Answers carried over loosely from a rater, or entered in a hurry across five portals, are where misstatements creep in. Good process on the application is risk management, not paperwork.

Using both well

Raters are not going anywhere, and they should not. A sensible split:

• Use the rater to decide which markets deserve a full application.
• Present the client numbers from completed carrier applications, not estimates.
• Keep the producer's review and affirmation as a real step, not a click.

The hard part has always been the middle: completing several carriers' applications without typing the same client into each one. That is the part we are working on.

A few questions for any quoting tool

• Does it return a price, or a completed application on the carrier's side?
• Who reviews and affirms the answers before reports are ordered?
• Where does the client's information live afterwards, and who can see it?
• What happens when the carrier's application changes?

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