The Gap Between What You Placed and What the Insurer Issued
A broker negotiates terms, the insurer confirms cover, and a policy document arrives. The unspoken assumption in most broker back offices is that the issued policy faithfully reflects what was agreed. In practice, the issued wording drifts from the placing slip more often than brokers admit, and the drift surfaces at the worst possible moment: when a surveyor reads the policy schedule during a claim and finds a warranty, a sub-limit, or an exclusion that neither the broker nor the client expected.
The agreed quote, the placing slip, and the insurer-issued policy are three separate documents produced at three different times by two different parties. The quote captures what the underwriter offered. The placing slip captures what the broker confirmed on the client's behalf. The issued policy is generated by the insurer's operations team, often from a template populated by a different person than the one who underwrote the risk. Each handoff introduces the possibility of transcription error, template default, or silent substitution of standard wording for negotiated wording.
The IRDAI (Protection of Policyholders' Interests, Operations and Allied Matters of Insurers) Regulations, 2024, in force from 1 April 2024, raised the bar on correct and timely issuance, mandated electronic issuance for defined lines, and tightened grievance and free-look handling. The regulation makes the insurer responsible for accurate issuance, but it does nothing to relieve the broker of the professional duty to verify that the document delivered to the client actually matches what was placed. A broker who forwards a defective policy without checking it has failed the client regardless of whose transcription error caused the defect.
This post sets out a discrepancy-control workflow: a structured, repeatable check of the issued policy against the placing slip, run before the policy reaches the client, so that mismatches are corrected by endorsement while correction is still cheap and uncontested.
The Three Documents That Must Reconcile Before Delivery
Discrepancy control starts with treating reconciliation as a formal control point, not a glance. The broker holds three reference documents, and each has a distinct evidentiary role.
What each document proves
The agreed quote is the underwriter's offer. It fixes premium, sum insured basis, deductibles, and the headline scope of cover, and it usually references a specific product wording by name and version. The quote is the earliest anchor and the one most likely to be superseded during negotiation.
The placing slip is the operative record of what the broker confirmed on the client's instructions. It should carry the final negotiated position: the agreed sum insured, the deductible structure, every add-on and extension that was bought, every clause and warranty that was negotiated in or out, and the specific wording version to be applied. Where the slip and the quote diverge, the slip governs, because it reflects the post-negotiation agreement.
The issued policy is the insurer's contractual instrument. It comprises the schedule, the base wording, and the attached endorsements. The schedule carries the variable data (insured name, period, sum insured, premium, deductibles), and the wording plus endorsements carry the coverage terms.
Why the reconciliation is non-trivial
Reconciliation fails when brokers check only the schedule. The schedule is the easy 20 percent: sum insured, premium, and period are visible on page one and rarely wrong. The difficult 80 percent lives in the base wording and the endorsement stack, where a negotiated deletion of a warranty may simply not have been actioned, or where the insurer's standard exclusion set has been attached in place of the amended set agreed on the slip. A disciplined broker reconciles all three documents field by field, records the check, and raises a correction request before the policy is released to the client.
A Field-by-Field Checking Protocol
The checking protocol converts a vague instruction to review the policy into a defined set of fields, each of which must be confirmed against the slip and initialled by the checker. The following fields cover the high-value ground for Indian commercial lines.
- Insured and interest details. Legal name, address, occupancy or trade description, and any co-insured, financier, or agreed bank clause interest. A wrong name or a missing financier endorsement can void a claim payout or breach a loan covenant.
- Sum insured and basis. The figure must match the slip, and the basis (reinstatement value, market value, first-loss, declaration) must match too. A reinstatement-value cover issued on an indemnity basis silently exposes the client to depreciation deductions at claim.
- Deductibles and franchise. Every layer of deductible, excess, and time-based waiting period, checked against the negotiated structure. Insurers frequently default to standard AOG or standard excess figures rather than the reduced figures negotiated.
- Add-ons and extensions. Each purchased extension (debris removal, architects and surveyors fees, escalation, temporary removal, additions and alterations) must appear with the agreed sub-limit. A missing extension is invisible until the loss falls squarely within it.
- Warranties and conditions precedent. Every warranty on the slip must be present, and no warranty absent from the slip should have been added. Warranties and conditions precedent to liability are the most dangerous silent additions because breach can defeat the whole claim.
- Clauses and exclusions. Negotiated clauses (waiver of subrogation, designation of property, 72-hour clause, non-invalidation) must be present, and the exclusion set must match the amended set, not the insurer template default.
Each field carries a pass, fail, or query status. Any fail or query is logged as a discrepancy and routed to the insurer for correction by endorsement before delivery.
Where Discrepancies Hide: High-Frequency Mismatch Points by Line
Discrepancies cluster in predictable places. A checker who knows the line-specific hotspots catches more in less time.
Fire and property (Bharat Sookshma / Laghu Udyam and standard fire)
The most frequent property mismatches are basis errors and sub-limit defaults. A reinstatement-value clause agreed on the slip but not attached leaves indemnity-basis settlement in force. Escalation clause percentages, debris-removal sub-limits, and the average clause (under-insurance condition) trigger point are commonly issued at template defaults rather than negotiated figures. Add-on covers such as spontaneous combustion, spoilage, or STFI where deleted or bought back are frequently mis-issued.
Marine cargo and transit
For marine cargo, the issued policy often reverts to Institute Cargo Clauses (C) or (B) when (A) all-risks was placed, or attaches a standard voyage and conveyance description that omits agreed transhipment, storage, or duty and increased-value extensions. Sum insured on a CIF plus 10 percent basis is frequently issued as plain CIF, quietly stripping the agreed margin.
Engineering (CAR, EAR, machinery breakdown)
Contractors all risks and erection all risks policies commonly mis-issue the maintenance period (visits maintenance versus extended maintenance), the testing and commissioning period for EAR, and the sub-limits for design defect (DE cover extent), surrounding property, and clearance of debris. The defects-exclusion tier (DE1 to DE5, or the LEG equivalent) is a frequent silent downgrade.
Liability lines
For public liability and product liability, mismatches concentrate in the retroactive date, the jurisdiction clause, the AOA and AOY limit split, and the presence or absence of pollution, product recall, or vendor extensions. A missing or wrong retroactive date on a claims-made professional indemnity or directors and officers liability policy is among the costliest issuance errors, because it can leave the exposure the client actually bought the cover for entirely unprotected.
Timing the Check Against the Free-Look Window and Issuance Deadlines
Discrepancy control is only as useful as its timing. A correct check delivered after the client has relied on defective cover has limited value. The workflow has to be tied to the issuance and free-look clock.
The issuance and free-look context
The PPHI Regulations, 2024 and the accompanying master circular tightened the expectation that policies are issued promptly and accurately in electronic form for defined lines. For retail and individual lines, the regulation provides a 30-day free-look period from receipt of the policy document within which the policyholder can review and return the policy. Most large commercial placements sit outside the retail free-look regime, so the broker cannot rely on a statutory cooling-off window to fix issuance defects. The practical implication is the reverse of what many assume: for commercial risks, the pre-delivery check is the only reliable safeguard, because there is no automatic right to return a defective policy after delivery.
Building the check into the issuance timeline
The check should run in the window between the insurer's issuance and the broker's delivery to the client, not after delivery. Three timing disciplines matter.
- Hold-and-check before release. The issued policy is logged into a checking queue on receipt and is not forwarded to the client until the field-by-field reconciliation is complete and signed off. Releasing unchecked policies to save a day is a false economy.
- Correction by endorsement within a defined SLA. Confirmed discrepancies are raised with the insurer immediately, with a target correction turnaround (commonly 5 to 7 working days) agreed in the broker-insurer service protocol. The corrected endorsement is checked again before delivery.
- Documented delivery with the checked-and-clean confirmation. The policy is delivered to the client with a covering note confirming it has been reconciled against the placed terms, and any residual open items are flagged explicitly.
Building the QA Function: Roles, Checklist, and Audit Trail
A repeatable check needs an owner, a standard instrument, and a record. Ad hoc vetting by whoever is free does not survive audit or staff turnover.
Segregation of duties
The person who placed the risk should not be the sole checker of the issued policy. The placing broker carries an unconscious bias toward seeing what they expect to see. A broker policy QA checklist run by a second reviewer, ideally the back-office policy-checking desk rather than the front-office account manager, catches errors the placer's eye slides past. For high-value or complex risks, a two-tier check (desk reviewer plus a technical lead sign-off on warranties, clauses, and basis) is proportionate.
The standard checklist instrument
The checklist is a controlled document, versioned and line-specific, that lists every field from the checking protocol with a pass, fail, or query column and a checker initial. It references the specific placing slip and quote version being reconciled against. Line-specific variants (fire, marine, engineering, liability, D&O and PI) carry the hotspots for that line so the checker is prompted to look where discrepancies actually hide.
The audit trail
The completed checklist, the discrepancy log, the insurer correction correspondence, and the checked-and-clean delivery confirmation together form the audit trail. The trail serves three purposes: it evidences the broker's discharge of professional duty in any subsequent PI dispute, it provides the documentary basis IRDAI inspection increasingly expects of broker operations, and it feeds a defect-pattern analysis that identifies which insurers and which product lines generate the most issuance errors.
Learning from the defect data
Over a few quarters, the discrepancy log becomes a management dataset. A broker that finds one insurer's fire wordings mis-issue the reinstatement basis in a meaningful share of cases can escalate the systemic issue to that insurer's operations head, tighten the check for that insurer, and set client expectations accordingly. The QA function stops being pure cost and becomes a source of standing in insurer relationships and a measurable quality differentiator.
From Manual Vetting to Wording Intelligence
Manual field-by-field checking is necessary, but it is slow and it depends on the checker knowing what the negotiated wording should say. The bottleneck is rarely the schedule data; it is the base wording and the endorsement stack, where a checker has to read dense clause text against the placing slip and against the correct version of the insurer's product wording to confirm that what was issued is what was agreed. This is where most checking desks run out of time and revert to schedule-only review.
The control improves sharply when the checker can pull the exact insurer wording version referenced on the slip and compare the issued clauses against it clause by clause, and against the equivalent clauses in the alternative wordings that were on the table during placement. Knowing that an issued exclusion is the insurer's standard template rather than the amended version agreed at placement requires having both versions side by side. Confirming that a warranty is a genuine negotiated term rather than a silently attached template condition requires knowing the base wording it came from.
Sarvada maintains a searchable intelligence layer over Indian insurer policy wordings, so a checking desk can retrieve the specific product wording and version, compare clauses across insurers and across versions, and verify that the issued exclusions, warranties, and clauses match what was placed rather than a template default. That turns discrepancy control from a memory-dependent manual read into an evidence-backed comparison. If your team runs policy checking against placing slips at volume, request access to see how wording-level search sharpens the reconciliation.