Why AAIS Is Widely Used for Builders Risk and Inland Marine Insurance

Builders Risk and Inland Marine are two of the most operationally complex lines in commercial insurance. They involve changing exposures, frequent endorsements, and program specific structures that do not fit neatly into rigid templates.

For these reasons, many MGAs, wholesalers, program administrators, and carriers rely on American Association of Insurance Services when designing Builders Risk and Inland Marine programs.

This article explains why AAIS is so commonly used for these lines and how organizations successfully operate AAIS based programs in practice.

Why Builders Risk and Inland Marine Are Different

Unlike standard commercial lines, Builders Risk and Inland Marine share several characteristics:

• Exposures change over time
• Coverage often applies to property in transit or under construction
• Endorsements are frequent and unavoidable
• Rating inputs vary widely by risk type

These realities require standards that allow flexibility without sacrificing consistency.

How AAIS Supports Builders Risk Programs

Builders Risk insurance must adapt to different construction methods, project phases, and ownership structures.

AAIS supports Builders Risk programs by providing:

• Multiple Builders Risk structures such as Civil, MU, and MU SPEC
• Modular coverage forms that can be adapted to project needs
• Rating guidance that supports varying limits and exposures
• Endorsement frameworks for mid term changes

This flexibility is one of the primary reasons AAIS is widely used for Builders Risk programs operated under delegated authority.

Learn more about operating Builders Risk programs: AAIS Builders Risk Platform

Why AAIS Works Well for Inland Marine Programs

Inland Marine insurance covers a broad range of risks that do not fit traditional property categories.

AAIS is commonly used for Inland Marine because it supports:

• Diverse risk classes under a single program
• Motor Truck Cargo rating by vehicle or gross receipts
• Flexible handling of limits and deductibles
• Complex endorsement requirements

These features make AAIS especially well suited for Inland Marine programs operated by MGAs and wholesalers.

Learn more about Inland Marine programs: AAIS Inland Marine Platform

AAIS vs More Rigid Standards for Specialty Lines

While Insurance Services Office is widely used for standardized commercial lines, specialty lines often require more configurability.

AAIS is frequently selected when:

• Programs require customization beyond standard templates
• Delegated authority structures demand flexibility
• Endorsements and mid term changes are common
• Programs must adapt quickly to market needs

This does not mean ISO is unsuitable. It means AAIS is often a better fit for these specific lines.

The Operational Reality of AAIS Based Programs

AAIS defines standards. It does not operate insurance programs.

To run Builders Risk and Inland Marine programs using AAIS, organizations must still implement:

• Rating logic in production systems
• Policy binding and issuance workflows
• Endorsements and mid term changes
• Accounting visibility and reporting
• Carrier and program oversight

Without operational platforms, AAIS standards remain theoretical.

See how AAIS standards are operationalized:

Production Ready AAIS Commercial Lines Platform for MGAs Wholesalers and Carriers

Who Uses AAIS for Builders Risk and Inland Marine

AAIS based Builders Risk and Inland Marine programs are commonly operated by:

• MGAs launching specialty programs
• Program administrators overseeing multiple MGAs
• Wholesalers placing complex risks
• Carriers supporting delegated authority

Each group relies on platforms to turn AAIS guidance into live programs.

How Selectsys Supports These Programs

Selectsys provides the operational layer required to run AAIS based Builders Risk and Inland Marine programs at scale.

This includes:

• Production ready rating implementation
• Policy issuance and endorsement workflows
• Reporting and operational visibility
• Support for delegated authority requirements

Learn more about AAIS program operations: AAIS Rating Policy Issuance and Accounting

Frequently Asked Questions About AAIS and Specialty Lines

Why is AAIS popular for Builders Risk?
AAIS supports multiple Builders Risk structures and flexible endorsements, making it well suited for construction-related programs.

Why do MGAs prefer AAIS for Inland Marine?
AAIS allows MGAs to manage diverse Inland Marine risks and frequent endorsements without rigid limitations.

Does AAIS operate Builders Risk or Inland Marine programs?
No. AAIS provides standards, while programs are operated by MGAs, carriers, and insurance platforms.

Is AAIS required for these lines?
No. AAIS is optional, but it is commonly chosen for its flexibility in specialty insurance programs.

Conclusion

Builders Risk and Inland Marine require insurance standards that can adapt to changing risks and program structures. AAIS is widely used for these lines because it provides flexibility while maintaining consistency and compliance. Successful programs combine AAIS standards with operational platforms that handle rating, issuance, endorsements, and reporting at scale.