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📄 '''Request for quotation (RFQ)''' is a formal solicitation used across the insurance industry in two distinct but related contexts: procurement of goods and services, and the placement of [[Definition:Insurance | insurance]] or [[Definition:Reinsurance | reinsurance]] coverage. In procurement, an RFQ invites vendors to submit firm pricing for a clearly specified product or service — such as [[Definition:Policy administration system | software licensing]], [[Definition:Claims management | claims handling]] services, or printing of policy documents — where the scope and specifications are already well defined. In the underwriting and placement context, an RFQ (or its equivalent, often called a "submission" or "indication request") is the mechanism by which a [[Definition:Insurance broker | broker]] or [[Definition:Policyholder | insured]] invites [[Definition:Underwriter | underwriters]] to quote terms and pricing for a specific risk, providing the risk details, desired [[Definition:Coverage | coverage]] structure, and requested [[Definition:Coverage limit | limits]] and [[Definition:Deductible | deductibles]].

🔧 In the underwriting context, the RFQ process begins when a broker assembles a risk submission containing the information an underwriter needs: [[Definition:Loss history | loss history]], [[Definition:Exposure | exposure]] data, financial statements, engineering reports, and a description of the coverage sought. This package is distributed to multiple markets — whether [[Definition:Lloyd's syndicate | Lloyd's syndicates]], domestic carriers, or [[Definition:Reinsurer | reinsurers]] — who evaluate the information and respond with quoted [[Definition:Premium | premiums]], proposed terms, conditions, and any [[Definition:Exclusion | exclusions]] or [[Definition:Warranty | warranties]] they require. The broker then compares quotes, negotiates on the insured's behalf, and ultimately binds coverage with one or more carriers. In the procurement context, the process is analogous but focused on operational needs: the issuing organization defines the deliverables precisely, vendors respond with unit pricing and delivery terms, and the organization selects based on price competitiveness, quality, and reliability. Both contexts share the principle that the RFQ presumes the buyer knows exactly what it wants — distinguishing it from the more exploratory [[Definition:Request for information (RFI) | RFI]] and the more solution-oriented [[Definition:Request for proposal (RFP) | RFP]].

💡 Efficient RFQ management has become a strategic priority across the insurance value chain. On the placement side, digital platforms and [[Definition:Insurtech | insurtech]] solutions — including electronic trading systems at [[Definition:Lloyd's of London | Lloyd's]] and various broker-market connectivity tools — aim to streamline the RFQ workflow, reducing the days or weeks historically needed to collect and compare quotes for complex [[Definition:Commercial insurance | commercial]] and [[Definition:Specialty insurance | specialty]] risks. Standardized data formats such as [[Definition:ACORD | ACORD]] standards facilitate cleaner, faster information exchange between brokers and underwriters. On the procurement side, insurance companies managing large technology or services budgets use structured RFQ processes to demonstrate value-for-money accountability to boards and regulators. Whether the objective is placing a multimillion-dollar [[Definition:Excess of loss reinsurance | excess-of-loss reinsurance]] tower or purchasing a fleet of laptops for a claims department, the RFQ discipline ensures that decisions are grounded in transparent, comparable pricing.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Request for proposal (RFP)]]
* [[Definition:Request for information (RFI)]]
* [[Definition:Insurance submission]]
* [[Definition:Binding authority agreement]]
* [[Definition:ACORD]]
* [[Definition:Insurance broker]]
{{Div col end}}

Definition:Request for quotation (RFQ) - Revision history

PlumBot: Bot: Creating new article from JSON