Binding authority compliance monitoring: every bound risk checked against its binder, the night the bordereau lands
Breaches flagged the day the risk is bound, not months later at audit.
See one case, screen by screen ↓Checking that every risk a coverholder or MGA binds on your paper sits inside the binding authority agreement — premium cap, max line, territory, class, minimum rate, deductibles, binding dates and aggregates. Binding Authority Compliance does it for every line of every bordereau, the night it lands, instead of a sample tested at audit.
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A binding authority agreement sets the terms on which you lend your paper: the premium cap, the largest risk the coverholder may bind, the permitted territories and classes, the minimum rate, the deductibles, how far back cover may be dated. What you actually learn about the business comes once a month, as a risk bordereau in the coverholder’s own layout — and the oversight analyst opens it, maps it by hand and samples a couple of dozen lines.
Everything else waits for the annual audit or the on-site review. By then a risk bound over the max line has run as an unreinsured line for months, a risk in an excluded county has sat outside the treaty, and a backdated risk may already carry a known loss. Meanwhile the premium cap lives in a spreadsheet updated monthly, so a binder can run past its cap before anyone notices.
Estimated split of oversight analyst time for one monthly risk bordereau, by hand and with the solution.
Six agents map every bordereau, read the binder into checks and test every line against every clause; the head of delegated authority decides.
Corvane Specialty Insurance Company fronts LKS-PROP-26-04, a small commercial property binder written by Larkspur Underwriting Managers in Texas, Oklahoma, Louisiana, Arkansas and New Mexico. Larkspur’s September risk bordereau lands on a Sunday night. Here is what happens next, screen by screen, in the working solution.
Larkspur_RiskBdx_Sep2026_v1.xlsx arrives through the coverholder portal: 412 lines, $1,688,400 gross premium, tying to Larkspur’s premium bordereau to the dollar. The bordereau reader maps their 14 columns to the standard fields — “Bldg TIV”, “BPP TIV”, “Incep”, “Bound Dt” — and asks before using the one it is unsure of: “Wind Ded” at 71%.
“Wind Ded” mixes percentages and dollars: rows 61 and 244 say “$25,000” — converted to 1.6% and 2.4% of TIV.
The binder reader turns the agreement, Schedules A–G and Endorsement 2 into 11 checks, applying the raised $18.0M cap only from 1 July. The authority checker runs 412 risks × 10 line checks — 4,120 tests — and the dots fall into the gauges as it goes. The referral matcher searches 37 referrals and 212 emails.
Authority checker: “Never clears a breach. Never samples.”
Nadia opens the binder: premium against the cap, max line, minimum rate, territory, class, wind/hail deductible, binding after inception and the Schedule C aggregate — each of September’s 412 risks placed on every one. Six risks sit outside the binder, and four notices show where it is close to a limit. One stands out on the max-line gauge: row 287 at $9.14M, 122% of the line.
“I don’t want to find a nine-million-dollar storage unit at the audit. I want it the morning the file lands.”
Row 287 is Tallgrass Bend Self Storage LLC, Rosenberg TX. On the left, clause 4.2(a) on page 7 of the agreement: no risk above $7,500,000 total insured value any one location. On the right, Larkspur’s bordereau as sent, row 287 highlighted: buildings $8,350,000 + contents $310,000 + business income $480,000 = Total TIV $9,140,000 — $1,640,000 over the line.
Clause 4.6 allows a risk above the limit only with Corvane’s prior written agreement. The referral log has nothing for Tallgrass Bend in 37 entries, Aug–Oct. The mailbox has one email from Larkspur underwriter Jared Okafor, Fri 11 Sep 16:42: “TIV around 9M, moving from their old carrier. OK to proceed at 0.45?” Neither authorised underwriter in Schedule E replied.
“A question is not the written agreement 4.6 requires.”
The notice to Dana Whitfield cites the bordereau file and row, the figures against clause 4.2(a) on page 7, and states that the 11 September email was not agreement. Under clause 9.2 it asks for an answer within 10 business days, by Monday 26 October 2026, and asks Larkspur to bind no further risks of this kind meanwhile.
The drafter never sends: nothing goes to the coverholder until Nadia records a decision.
The suggested decision is to refer to Callum Reyes, who owns the Larkspur binders: keep the risk only with a co-insurer for the $1,640,000 above the line, or cancel on 30 days’ notice under clause 8.4. Nadia records it. The referral and the breach notice go out together, and the decision lands on the audit trail with her name and the time.
Seven of nine September bordereaux are in: 1,980 risks across 9 binders, 14 breaches, nothing sampled. At the top is row 52 on the same binder — Wolfcreek Collision & Paint, Wichita Falls, bound 38 days after inception against a 15-day limit, with a hail loss on 30 Aug at that address on Larkspur’s claims bordereau, reserve $46,800. Critical.
LKS-PROP-26-04 has $14.22M bound against its $18.0M cap — 79.0%. At the July–September pace of $1.72M a month it crosses the 85% notice line about 19 Oct and the cap about 6 Dec, 25 days before expiry. TRP-CYB-26-01 is closer: its $12.0M cap about 29 Oct, 63 days early. Nadia can draft an endorsement raising the cap for the program underwriter to approve, or tell Tamsin Ridge to stop new business at the cap.
The report drafter builds Larkspur’s September authority compliance report from every check and every decision: 412 risks, 100% checked, 6 outside the binder, headroom and bordereau quality, each figure linked to its source. Nadia signs; it goes to Marcus Odom, CUO, who acknowledges it, and to Dana Whitfield at Larkspur.
The same September bordereau, seen by the five people who carry it — what their month looked like, and what it looks like now.
Six agents map every bordereau, read the binder into checks and test every line against every clause; the head of delegated authority decides.
Reads each coverholder’s risk and claims bordereaux in their own layout, maps every column to the standard fields using the coverholder’s saved layout, and checks that totals tie to the premium bordereau.
Turns the binding authority agreement, its schedules and endorsements into checks — premium cap, notice line, max line, aggregates, territory, classes, rates, deductibles, dates and reporting — each with its value, clause, page and effective dates.
Runs every line check of the binder on every line of the mapped bordereau, ranks breaches by the severity rules, marks lines within 10% of a limit as notices and places each risk on every gauge.
Searches the referral log and the underwriting mailbox for the Company’s prior written agreement to each breach, and matches the claims bordereau for losses at the same address before the binding date.
Adds up premium and aggregates by binder and projects when each cap is reached at the recent pace.
Drafts breach notices and the monthly authority compliance report, citing the clause and the bordereau row behind every figure.
Decides and signs. The agents propose; a named person decides.
Anyone on the oversight team can ask about a bordereau row, a clause or a coverholder — or have it draft the notice. Every answer links to its source.
Why is row 287 a breach?
Tallgrass Bend Self Storage LLC, Rosenberg TX, is on Larkspur’s September bordereau at a total insured value of $9,140,000 — buildings $8,350,000, contents $310,000, business income $480,000. Clause 4.2(a) limits any one location to $7,500,000, so it is $1,640,000 over — 122% of the line. Clause 4.6 allows that only with Corvane’s prior written agreement. The only trace is Jared Okafor’s email of 11 Sep asking “OK to proceed?”, which nobody answered.
When will Larkspur’s property binder hit its premium cap?
$14,219,400 of $18,000,000 is bound to 30 Sep — 79.0%. At the July–September pace of $1.72M a month, it crosses the 85% notice line about 19 Oct and the cap about 6 Dec — 25 days before the binder expires. The cap was raised from $15.0M by Endorsement 2 on 1 Jul.
Which coverholders breach most often?
Per 1,000 risks bound this year, Halberd Lowe is highest at 17.2 and slowest to answer a breach notice (9 days); its on-site audit is 27 Oct. Larkspur jumped to 7 breaches in September from 3 in August.
Draft the breach notice to Larkspur
Drafted for row 287 to Dana Whitfield: it quotes clauses 4.2(a) and 4.6, attaches row 287 as Larkspur sent it, notes that the 11 Sep email is not agreement, and asks under clause 9.2 for an answer by Mon 26 Oct. Notices for the other five breaches are drafted the same way. Nothing is sent until you record a decision.
13 screens from the working solution, on its sample data. Pick one to see it large.
How breaches are found, ranked and answered. Changes are versioned and apply to the next check.
| Setting | Default | Choose from |
|---|---|---|
| Notice when premium reaches | 85% of the binder’s cap | Any percentage · the binder’s own notice clause applies if lower |
| “Close to a limit” from | 90% of a max line or aggregate | Any percentage |
| Pace for projections | Last 3 months | Last 3 months · Last 6 months · Year to date |
| Known loss before binding is critical | On | Matched from the claims bordereau by address and date |
| Clearing a high or critical breach needs the program underwriter | On | A second name on the decision |
| Coverholder answer time | 10 business days | 5 · 10 · 15 business days |
| Ask before using a mapping below | 80% match confidence | 70 · 80 · 90% |
| Remind coverholders | 3 days before a bordereau is due | On · Off |
Every figure is labelled: a target the solution is built to, an estimate, a typical published result, or a proven one.
“demo” = seen in the working solution, on its sample binder and bordereau data · “target” = the design goal, measured in the live solution · “estimated” = our estimate · “typical” = published figures (Conning fronting market report via itiger, 2025 — fronting gross premium up 26% to $19.6 billion in 2024; Conning via Reuters — US MGA premium up 16% to $114.1 billion in 2024). Market context: Lloyd’s market message, May 2025; LMA coverholder audit scope guidance v3.1 (2025); NAIC Managing General Agents Model Act. People, companies, binders and risks named on this page are fictional — characters and sample data in the working solution.
Checking that every risk a coverholder or MGA binds on your paper sits inside the binding authority agreement — premium cap, max line, territory, class, minimum rate, deductibles, binding dates and aggregates. Binding Authority Compliance does it for every line of every bordereau, the night it lands, instead of a sample tested at audit.
The bordereau reader maps each coverholder’s columns to the standard risk fields, using their saved layout first, and shows the confidence of each match. Below the threshold you set — 80% by default — it asks before using a match. It never changes a reported value and checks that the risk bordereau ties to the premium bordereau.
The binder reader reads the agreement, its schedules and every endorsement and writes each limit as a check with its value, clause, page and effective dates. An endorsement applies only from its effective date, and a clause it cannot turn into a check goes to the head of delegated authority.
Only if it is written agreement from an underwriter named in the binder’s list of authorised underwriters. The referral matcher searches the referral log and the underwriting mailbox, quotes what it finds, and never treats a question without a reply as agreement.
Yes. The headroom tracker adds up premium and aggregates by binder and projects the date each cap is reached at the recent pace, against the binder’s expiry. Projections are labelled as estimates, and it never changes a cap — a cap increase is drafted as an endorsement for the program underwriter to approve.
Yes. Agents read, check, match and draft; the head of delegated authority clears, refers or escalates, and nothing is sent to a coverholder until she records a decision. Clearing a high or critical breach needs a reason and the program underwriter’s name, and every decision is on the audit trail.
Yes. An MGA or coverholder can run the same checks on its own bordereau against its binders before the file goes to the capacity provider, so a breach is caught by the people who bound it.
The Agentic Solution Engine builds and deploys it from your requirements and documents — your binding authority agreements, endorsements, rating guides and a few months of bordereaux — and it goes live once every quality gate has passed. We will walk you through it on one of your own binders first.
Every bordereau in your layout on arrival, each rejected row with its reason.
1-min demoBinder Guidelines SearchFewer needless referrals, and every answer shows the clause that decides it.
1-min demoPremium Bordereaux ReconciliationEvery difference between bordereau and cash given a cause before settlement.
1-min demoWe’ll run Binding Authority Compliance on one of your binders and a few months of its bordereaux.