Strategic Insurance Coverage Challenge:
A local construction, development, and property management company in the Indianapolis area partnered with a large, publicly traded real estate investment trust (REIT) to secure debt and equity for a new healthcare-focused active adult living facility.
The planned project — a $50 million total insured value (TIV) wood-framed development — is expected to take roughly 2.5 years to complete.
As the project progressed, a strategic insurance coverage problem was exposed. Both the client and the REIT independently engaged their respective insurance brokers to shop for builder’s risk coverage through different market channels. The REIT’s broker returned a quote based on a reduced TIV of $38 million to keep total insurance costs within the project budget. However, this approach effectively removed $12 million in value from the coverage, leaving key exposures uninsured and misaligned with the project’s accurate risk profile.
Solution:
Serving as the developer’s fractional insurance executive, KBIC collaborated with the developer’s broker to market the project at the full $50 million total insurable value.
The resulting proposal matched the REIT’s option in deductibles, sub-limits, and coverage terms — yet came in $0.08 per $100 lower in rate. This translated into an estimated $60,000 in savings over the course of the project, while maintaining comprehensive coverage across all insurable aspects.
Through transparent benchmarking and direct market comparisons, KBIC demonstrated that its approach not only preserved complete protection but also produced measurable cost efficiency, validating the strength of its broker collaboration process.
Why KBIC:
KBIC helps small to mid-sized businesses compete on a level playing field with large institutional entities. Our expertise is helping solve strategic insurance coverage challenges. While publicly traded partners and their brokers often have greater resources, KBIC provides an equally sophisticated, data-driven strategy that protects clients’ interests without compromising cost or coverage quality — reinforcing the adage:
“It’s not the size of the dog in the fight, it’s the size of the fight in the dog.”
Through a combination of market intelligence, broker collaboration, and construction-specific expertise, KBIC empowers clients to make informed, strategic insurance decisions that strengthen their position in complex joint ventures and partnerships.
When you look at your internal team managing insurance, do they have the time and expertise to negotiate and collaborate with your brokers to achieve better outcomes? If not, bringing KBIC in as a fractional insurance executive — serving as your fiduciary on your side of the table — might be precisely what you need.
Impact:
- Covered all insurable aspects of a $50M project without reducing limits
- Achieved $0.08 per $100 in cost savings compared to REIT’s broker proposal
- Preserved project budget while enhancing protection scope
- Enabled a mid-sized client to compete effectively with a large institutional partner