It's hard to think in the language of policies – easy to think in the language of risks. The cover map does exactly this translation: on one side the company's real risks, on the other the existing contracts, and in the middle, the truth: what's covered, what isn't, and what you're paying premium for twice.
- The map's rows are the risks (fire in the warehouse, defective performance, a key machine going down…), its columns are the contracts.
- There are three states: covered, not covered, covered twice – and you need to see all three.
- The map isn't a one-off work of art: it's a working tool to be updated yearly and at every major change.
How is it built?
The first step is the risk list: what are the ten to twenty events that would cause the company real damage? It's worth working through it by compass point – property, liability, people, operations (the SME insurance map) – and phrasing things concretely: not "fire damage", but "fire in the insulation-material warehouse". The second step is the contract list – this comes ready-made from the portfolio inventory. The third step is matching: going row by row to see which contract, with what limit and deductible, answers that particular risk. Fillable template: cover map template.
What does it reveal?
The map tends to reveal three things. The first is the gap: a risk that no contract answers – finding these is what the gap hunt is about. The second is the overlap: two contracts responding to the same risk – typically not a double payout, but a double premium: the overlap hunt. The third is the sizing error: the risk is covered, but the limit is unrealistically small, or the deductible unrealistically large – fine on paper, not enough at claim time.
The map and conscious decisions
It's important to say: the map's goal isn't for every cell to be "covered". There are risks the company consciously carries itself – because they're absorbable, because covering them would be disproportionately expensive, or because they're better handled through prevention. That's exactly the map's value: an uncovered band shouldn't be an accident, it should be a decision. That's the difference between cutting corners and taking on risk deliberately – and it's exactly what a portfolio review spells out.
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