What Does AAIS Do and What Does It Not Do in Insurance
AAIS is widely referenced in commercial insurance, yet it is often misunderstood. Many MGAs, wholesalers, and carriers assume AAIS provides operational systems because its standards are used across rating, forms, and filings.
In reality, AAIS plays a very specific role in the insurance ecosystem. Understanding what AAIS does and what it does not do is essential for building scalable commercial lines programs.
What AAIS Is in Insurance
American Association of Insurance Services is a not for profit insurance advisory organization that provides standardized policy language, manuals, and rating guidance for commercial insurance products.
AAIS is used by carriers, MGAs, wholesalers, and program administrators to establish consistent insurance product frameworks.
What AAIS Does
AAIS focuses on defining insurance standards rather than operating insurance programs.
Specifically, AAIS provides:
- Commercial insurance policy forms and manuals
- Rating guidance used to price risks
- Support for regulatory filings and compliance
- Statistical reporting frameworks
- Flexible program structures for specialty lines
AAIS standards are commonly used in delegated authority programs where consistency and compliance are critical.
What AAIS Does Not Do
AAIS does not operate insurance programs or provide transactional systems.
AAIS does not:
- Rate risks in real time
- Generate quotes
- Bind coverage
- Issue policies
- Process endorsements
- Manage accounting workflows
- Provide operational reporting systems
AAIS defines how insurance products should be structured. It does not provide the technology or processes that execute those products day to day.
Why This Distinction Matters
Many insurance programs encounter friction because AAIS is mistaken for an operating platform.
When organizations rely on AAIS alone, they often face:
- Manual rating implementations
- Disconnected policy issuance workflows
- Spreadsheet driven endorsements
- Limited visibility into premium activity
- Reporting gaps across programs
AAIS standards must be implemented within operational platforms to function at scale.
How Insurance Programs Actually Use AAIS
In practice, AAIS is one component of a broader operating model.
A typical AAIS based program uses:
- AAIS for forms and rating guidance
- A platform to implement rating logic
- Systems to bind and issue policies
- Tools to manage endorsements and servicing
- Accounting visibility and reporting
This layered approach allows organizations to maintain compliance while operating efficiently.
Learn how AAIS standards are operationalized:
Production Ready AAIS Commercial Lines Platform for MGAs Wholesalers and Carriers
Common Lines of Business That Use AAIS
AAIS is particularly common in lines that require flexibility and program specific structures.
Examples include:
- Builders Risk
- Inland Marine
- Motor Truck Cargo
- Specialty delegated authority programs
These products often involve complex endorsements and mid term changes that require more than static standards.
Learn more about these programs:
AAIS Compared to Other Standards Organizations
Insurance Services Office serves a similar role to AAIS but is more commonly associated with standardized admitted lines. Both organizations define standards. Neither operates insurance programs.
The difference lies in flexibility, program structure, and typical use cases rather than quality or compliance.
Where Platforms Fit In
Platforms exist to turn insurance standards into live programs.
For AAIS based products, platforms are responsible for:
- Implementing rating logic
- Supporting policy binding and issuance
- Managing endorsements and mid term changes
- Providing accounting visibility
- Enabling reporting and oversight
Without platforms, AAIS standards remain theoretical.
See how platforms support AAIS programs: AAIS Rating Policy Issuance and Accounting
Frequently Asked Questions About What AAIS Does
Does AAIS issue insurance policies?
No. AAIS provides standards and guidance, while policy issuance is handled by carriers and insurance platforms.
Does AAIS provide rating software?
No. AAIS publishes rating guidance, which rating engines implement within production systems.
Is AAIS required to run an insurance program?
No. AAIS is optional. Carriers choose AAIS or other standards organizations based on program needs.
Who is responsible for operating AAIS programs?
MGAs, wholesalers, carriers, and program administrators operate AAIS programs using their own platforms and processes.
How Selectsys Supports AAIS Programs
Selectsys provides the operational layer that implements AAIS standards in production.
This includes:
- Rating implementation
- Policy issuance and endorsements
- Accounting visibility and reporting
- Support for delegated authority programs
Learn how AAIS standards are operationalized: AAIS Rating Policy Issuance and Accounting
Conclusion
AAIS plays a foundational role in commercial insurance by defining standards and guidance. It does not operate insurance programs or provide transactional systems.
Understanding this distinction allows MGAs, wholesalers, and carriers to design better programs and choose the right platforms to support them.
