How to Complete the ACORD 125: Field-by-Field Guide

Agency Name and Address

What it is asking: The full legal name of your agency and your business mailing address.

Why the underwriter needs it: Routes the submission internally and ties the account to your agency for commission and service purposes.

Common entry: "Hooshmand Insurance Agency, 123 Main St, Suite 400, Houston TX 77002"

Tip: Use your agency's official name exactly as it appears on your E&O policy and carrier appointment. Mismatches can delay commission payments.

Agent / Producer Name and License Number

What it is asking: The name of the individual agent handling the account and their state license number.

Why the underwriter needs it: Many carriers require the producing agent's license number to verify appointment and ensure the agent is licensed in the state where the risk is located.

Common entry: Your NPN (National Producer Number) or your state-specific license number.

Tip: Double-check that your license is active in every state where the insured has operations. Carriers will reject or hold submissions if the agent is not licensed in a risk state.

Agency Phone, Fax, and Contact Email

What it is asking: The best contact information for questions about the submission.

Why the underwriter needs it: Underwriters call or email agents frequently during the quoting process — make sure the contact information routes to someone who knows the account.

Tip: Use a direct line, not a general agency phone tree. Slow callbacks cost you quotes at carriers with underwriting capacity limits.

Proposed Effective Date and Expiration Date

What it is asking: The date you want coverage to begin and the date it ends — typically one year later.

Why the underwriter needs it: Determines the policy period for rating, sets prior acts coverage cutoffs on claims-made policies, and triggers the underwriting review timeline.

Common entry: For renewals, match the current policy expiration date. For new business, allow at least 10–14 business days from submission to effective date for the underwriter to review and quote.

Tip: Avoid requesting same-day or next-day effective dates unless you have a prior carrier relationship. Rushed submissions often receive less favorable terms or get declined without a full review.

Named Insured (Legal Business Name)

What it is asking: The exact legal name of the entity being insured — as registered with the state or as shown on the IRS EIN letter.

Why the underwriter needs it: The named insured on the policy must match the legal entity that owns or operates the business. A mismatch creates coverage disputes at claim time.

Common entries: "Smith Plumbing LLC", "Advanced Roofing Inc.", "John D. Smith DBA ABC Landscaping"

Tip: If the business operates under a DBA that is different from the legal name, list the legal name first and add the DBA immediately below. Never list only the DBA as the named insured — it is not a legal entity.

DBA (Doing Business As)

What it is asking: Any trade name the business uses that differs from its legal name.

Why the underwriter needs it: Certificates of insurance and additional insured endorsements are often issued using the DBA. The policy needs to reference it to avoid confusion at claim time.

Common entry: "Smith Plumbing LLC DBA Houston Plumbing Pros"

Tip: If your client operates under multiple DBA names (for example, a property management company that brands each complex separately), list all of them. Ask if any are registered separately with the state — they may need to be named insureds on their own.

FEIN (Federal Employer Identification Number)

What it is asking: The 9-digit IRS tax identification number for the business (format: XX-XXXXXXX).

Why the underwriter needs it: Used for loss run verification, premium audit matching, and CLUE commercial database lookups. Carriers use the FEIN to cross-reference claims history across carriers.

Common entry: Obtained from the IRS EIN letter (CP 575) or the business's prior tax return (Form 1120 or Schedule C).

Tip: Never use the owner's personal Social Security Number in the FEIN field even for sole proprietors who operate without a separate EIN — get one issued via IRS.gov (it takes 5 minutes online). Using an SSN here is a privacy risk and can cause issues with the commercial CLUE database lookup.

Entity Type

What it is asking: The legal structure of the business. Typical options: Individual/Sole Proprietor, Partnership, LLC, Corporation, Joint Venture, Trust, Non-Profit.

Why the underwriter needs it: Entity type affects coverage structure (e.g., which individuals are covered under the business policy vs. needing separate coverage), audit processes, and endorsements for officers and partners.

Common entries: Most small businesses are LLCs or S-Corps. Contractors are often sole proprietors or single-member LLCs.

Tip: Ask your client to pull up their state registration on your state's Secretary of State website to confirm the exact entity type. Many clients say "LLC" when they are actually incorporated as a corporation, or vice versa.

Mailing Address and Location Address

What it is asking: Where to send policy documents (mailing) and where operations are physically conducted (location).

Why the underwriter needs it: Location addresses drive rate territory for general liability and property. Mailing addresses are used for policy documents and premium invoices. These are often different — especially for home-based businesses or businesses with multiple locations.

Tip: If the business has multiple locations, list the primary location here and attach a separate schedule of locations. Do not leave any operating location off the form — unlisted locations are generally not covered under the policy.

Nature of Business / Description of Operations

What it is asking: A written description of what the business does — its services, products, customers, and how it operates.

Why the underwriter needs it: This is the single most important field on the form. The underwriter uses it to confirm the SIC code is correct, identify any excluded operations, and assess the overall risk profile. Vague descriptions cause declines and delays more than any other issue on commercial submissions.

Good example: "General contractor specializing in commercial tenant improvement projects for office and retail spaces. No residential work. Subcontracts approximately 60% of trade work (electrical, plumbing, HVAC) to licensed subs. All subs required to carry GL and WC with contractor listed as additional insured."

Bad example: "General contractor" or "Construction company"

Tip: Write 3–4 sentences minimum. Include what the business does, who its customers are (residential vs. commercial, B2B vs. B2C), geographic scope, and any relevant details about how it manages risk. A good description can be the difference between a same-day quote and a weeklong back-and-forth.

SIC Code (Standard Industrial Classification)

What it is asking: A 4-digit code that classifies the type of business for industry statistical purposes.

Why the underwriter needs it: SIC codes determine which underwriting guidelines apply, which exclusions are automatic, and help set base rates in many rating systems. An incorrect SIC code can result in a quote that is inaccurate or voided at audit.

Common entries: 1711 (Plumbing, Heating & AC), 1731 (Electrical Work), 7011 (Hotels/Motels), 5812 (Eating Places)

Tip: Use OSHA's SIC search tool at www.osha.gov/sic-manual or your agency management system's built-in lookup. If you are unsure between two codes, describe the business to your underwriter — they will confirm the right code before quoting.

Years in Business / Date Business Started

What it is asking: How long the business has been in continuous operation under current ownership.

Why the underwriter needs it: Newer businesses (under 3 years) are considered higher risk and may face higher premiums, reduced limits, or carrier-specific restrictions. Years in business also factors into eligibility for experience modification factors on WC coverage.

Tip: If ownership changed recently but the business has been operating for many years, note both: "Business established 2008, current ownership since 2021." This context helps the underwriter distinguish between a true startup and an experienced operation under new management.

Number of Employees — Full-Time, Part-Time, and Seasonal

What it is asking: The current headcount broken down by employment type. Full-time is typically defined as 30+ hours per week; part-time is under 30 hours; seasonal employees work during specific periods only.

Why the underwriter needs it: Employee counts drive rating for general liability (exposure base), workers comp payroll estimates, and employer practices liability. They also affect whether the business triggers certain coverage thresholds (e.g., EPL coverage eligibility).

Common entries: FT: 12, PT: 4, Seasonal: 0

Tip: Do not exclude 1099 workers who function like employees — carriers will reclassify them during an audit and adjust premium accordingly. If your client uses a significant number of independent contractors, disclose it and let the underwriter decide how to treat them.

Annual Gross Revenue / Annual Gross Sales

What it is asking: Total revenue before expenses for the most recently completed fiscal year. For some businesses (contractors, professional services), this may also be called gross receipts or billings.

Why the underwriter needs it: Revenue is the primary rating basis for many GL classifications. It also signals the size and scope of the operation. Underwriters compare revenue to employee count as a sanity check — if a business claims $10M in revenue but only 2 employees, that raises questions.

Common entry: Use the figure from the most recent tax return (Schedule C gross receipts, or Form 1120 line 1c). If the business has grown significantly, you may also want to note the projected current year revenue.

Tip: If revenue dropped significantly due to an anomalous year (e.g., COVID shutdown in 2020), note this with a brief explanation and provide the prior year figure as well. Underwriters appreciate context — an unexplained revenue drop is a red flag; an explained one is not.

Current or Prior Carrier Name, Policy Number, and Expiration Date

What it is asking: The name of the current (or most recent) insurance carrier, the policy number, and when the policy expires or expired.

Why the underwriter needs it: Carriers use prior carrier information to verify loss run requests, check non-renewal history, and assess the insured's insurability track record. A history of carrier changes every year is a red flag.

Common entry: "Travelers Insurance, Policy #ABC-1234567, Expires 08/01/2026"

Tip: If the client was previously non-renewed or cancelled for underwriting reasons (not non-payment), disclose it proactively with an explanation. Hiding a non-renewal that the carrier discovers in their loss database is far worse than disclosing it upfront.

Prior Carrier Premium

What it is asking: The annual premium the insured currently pays (or most recently paid) for the same line of coverage.

Why the underwriter needs it: Helps the underwriter benchmark their own quote and identify if the current coverage is significantly under-insured (very low premium relative to exposure may signal inadequate limits or undisclosed operations).

Tip: Provide the premium broken out by line of coverage if the client has a package policy. A single lump-sum premium for a BOP with GL, property, and inland marine makes it hard for the underwriter to compare apples to apples.

Losses / Claims — Date, Amount Paid, Amount Reserved, Description

What it is asking: All claims, losses, and incidents that occurred within the past 5 years — even if no payment was made (i.e., reported claims that were subsequently denied or closed without payment should still be listed).

Why the underwriter needs it: Claim frequency and severity are among the strongest predictors of future losses. Carriers weight recent claims heavily. A business with 3 GL claims in 5 years will be rated very differently than one with zero claims.

For each claim, provide: Date of loss, type of claim (GL, property, auto, WC), total amount paid, amount still reserved, and a brief description of what happened and how it was resolved.

Tip: Never advise a client to omit or minimize a claim. Carriers cross-check against their loss databases and the prior carrier's records. An omission discovered at claim time can be grounds for policy rescission. If a claim was unusual or corrective action was taken, include a brief explanation — this dramatically improves how underwriters view the account.

"No Losses" Declaration

What it is asking: If there have been no losses in the past 5 years, this field (or a check box on some versions) confirms a clean loss history.

Why the underwriter needs it: Clean loss history is a significant underwriting advantage and often qualifies the account for preferred pricing and higher appetite from the carrier.

Tip: Even with a clean loss history, obtain loss runs from the prior carrier before submitting. Many underwriters require 5-year loss runs regardless of what the application states. Having them attached at submission avoids a common delay.

Lines of Coverage Requested

What it is asking: Which types of commercial coverage the client is applying for — General Liability, Commercial Property, Inland Marine, Commercial Auto, Workers Compensation, Umbrella, and so on.

Why the underwriter needs it: Tells the underwriter which line-specific supplemental forms to expect. A GL submission without an ACORD 126 will be returned incomplete. A property submission without an ACORD 140 cannot be quoted.

Tip: Check every coverage type the client needs — even if you plan to submit each line to a different carrier. Each carrier needs to know the full scope of coverage the client is seeking so they can confirm their policy does not create gaps in coordination with other carriers.