Farmers Mutual of Tennessee

Carrier appetite summary

Preferred / target homeowners risks (per Homeowners Risk Selection Summary and underwriting manual references): - Owner-occupied 1–2 family dwellings in good condition with no known hazards; home must be visually inspected prior to submission. - Dwellings meeting age, roof, protection class, and value thresholds by form: • ML-3 (Special / RC): generally less than 60 years old; newer construction with central heat/air and superior fire protection; minimum Coverage A $100,000 and 80–90% of market value (land excluded); asphalt shingle roof <10 years or metal roof in good condition; protection class 7 or better within city limits; financially stable applicants with good financial responsibility reports. • ML-2 (Broad / RC): newer dwellings with superior heating systems; minimum Coverage A $75,000 and 75–90% of market value; asphalt shingle roof <12 years or metal roof in good condition; protection class 8 or better (PC 9–10 allowed if visible from street and within 300 feet and in sight of at least two other occupied dwellings); financially stable applicants. • ML-2 (ACV): older but above‑standard construction in excellent repair; minimum Coverage A $50,000 with 70–90% of market value, and minimum market value of $35/sq ft; asphalt shingle roof <12 years or metal/tile/slate in good condition; PC 8+ (PC 9–10 allowed with same visibility/neighborhood proximity standard as ML‑2 RC); financially stable applicants. • ML-1 (Basic / ACV): older, lower‑value homes in good condition; minimum Coverage A $40,000 with 70–85% of market value; asphalt shingle roof <15 years or metal/tile/slate in good condition; all protection classes acceptable if dwelling is in sight of at least one other dwelling; financially stable applicants. - Market‑value approach to dwelling limit selection: agents expected to determine and document market value (sale/contract price minus land where available; otherwise use square‑foot price appropriate for local area with support from local real‑estate or similar sources). Agents should consult their underwriter if valuation is uncertain. Restricted or refer risks: - Any risk falling outside the summarized parameters (age, roof condition/age, protection class visibility/proximity, minimum Coverage A, market‑value percentages or per‑square‑foot requirements) must be discussed with an FMT underwriter prior to binding. - Homes built before 1900 must be submitted for prior approval even when otherwise meeting ML‑3 criteria. - Roof types specifically noted as not acceptable by form: roll, flat, and built‑up roofing (ML‑3 and ML‑2); roll or built‑up roofing (ML‑1 and ML‑2 ACV). Any such roof requires underwriter review and is typically unacceptable. - Any indication that the home is not in good condition, has unrepaired damage, visible hazards, or does not appear well maintained should be referred, not bound. Declined / generally unacceptable characteristics (from summary and manual references): - Homes with unapproved roof types/conditions (roll, flat, built‑up, or worn/poor condition roofs) for the indicated forms. - Dwellings that cannot reasonably be valued using FMT’s market‑value method (e.g., incomplete, severely distressed, or speculative properties) unless specifically approved by an underwriter. - Applicants who are not financially responsible or who show poor financial responsibility reports. - Risks where known hazards exist and cannot be remedied or adequately underwritten. Geographic notes: - FMT is a Tennessee domestic mutual carrier; homeowners business is written only in Tennessee, with emphasis on local market conditions and agent knowledge of area property values. - Protection‑class expectations differ by form: ML‑3 prefers city locations with PC 7+; ML‑2 and ML‑2 ACV accept PC 8+ and selectively 9–10 with strong neighborhood visibility and proximity; ML‑1 can accommodate all protection classes if at least one other dwelling is in sight. Submission / binding requirements and process (from risk‑selection and manual excerpts): - Agents must verify that the dwelling is in good condition with no known hazard before submitting; on‑site exterior observation is expected. - Prior to binding any new homeowners policy, agent should confirm: • Age of dwelling and heating/AC systems and that they match the selected form. • Roof type and age meet the applicable form standard. • Protection class and, for PC 9–10 risks, that visibility and distance to neighboring occupied dwellings meet the stated guidelines. • Coverage A is within the required minimum and percentage range of market value, documenting how market value was determined. • Applicant’s financial responsibility is satisfactory per company standards. - Risks that do not clearly meet the published summary parameters must be discussed with and approved by an underwriter before the agent binds coverage. Broker / producer notes (from Agency Philosophy and manual references): - FMT relies heavily on independent agents to screen for moral hazard and property condition; agents share responsibility for underwriting quality and loss ratio. - Agency loss ratio over a 3–5 year period is used as a primary measure of agency performance, and favorable experience may be rewarded through contingency programs; persistently unfavorable results can lead to termination of the agency contract. - Agents are expected to adhere to underwriting requirements, maintain good documentation of valuation and condition, and contact their underwriter whenever a risk is borderline or outside stated guidelines. - Structure valuation and risk‑selection summaries are supplements to, not replacements for, the full FMT Underwriting Manual, which agents should consult for detailed rules by form and coverage. Operationally, agents should treat ML‑3 and ML‑2 as preferred newer, well‑protected, well‑maintained homes; ML‑2 ACV and ML‑1 accommodate older and lower‑value dwellings that are still in sound condition, with stricter roof and valuation discipline and close coordination with underwriting for any exceptions.

Referenced source pages