Why Misclassifying a Business Is Killing Your Close Rates

Written by Ryan Hanley | Jul 22, 2025 8:49:04 PM

 

The One Data Point That Can Make or Break Your Commercial Insurance Business

 

Everyone blames their tech stack when deals stall or underwriting blows up.
But what if the real problem isn’t your systems?
What if it comes down to one single line on your application?

The NAICS code.

That’s it.

If your business classification is wrong, everything you do afterward — placement, pricing, risk analysis, coverage recommendation — is built on a lie.

And in commercial insurance, that’s a pipeline killer.

 

The Classification Mistake That Wrecks Deals

 

Let’s say you classify a client as a landscaper:
NAICS 561730 – Landscaping Services.

Looks good. You send the submission.

Then underwriting takes a closer look.

Turns out that “landscaper” also does tree removal — climbing, chainsaws, bucket trucks, the whole deal.
Now that simple landscaping risk is a high-exposure, out-of-appetite liability bomb.

The carrier declines.

You’re forced to reclassify.
Re-examine.
Re-explain.

What should’ve taken hours now drags into days.

The client loses confidence.
Your credibility takes a hit.
And your pipeline — the one you hustled to build — slows to a crawl.

 

This Isn’t a Rare Problem. It Happens Every Day.

 

Misclassification is one of the most common — and costly — errors in commercial insurance.
It leads to:

  • Declined submissions

  • Wasted underwriting cycles

  • Pipeline delays

  • Lost trust with clients and carriers

  • Reduced profitability

And here’s the worst part:

As AI becomes more embedded in placement engines, risk scoring, appetite matching, and coverage recommendations…
The risk of misclassification gets multiplied.

 

AI Is Only as Good as Its Data

 

We’ve all heard it:
Garbage in, garbage out.

If your AI tools are running on bad classification data, they’re going to give you bad recommendations.

Wrong appetite match.
Wrong coverage suggestions.
Wrong claims decisions.

And in this business, bad data isn’t just inconvenient.
It costs real money, damages real relationships, and risks real reputations.

 

Why Classification Is the Foundation of Smart Insurance Decisions

 

NAICS codes aren’t sexy.
They’re not flashy.

But they’re everything.

They’re the connective tissue between business reality and every smart insurance decision that follows.
Without accurate classification, you can’t:

  • Match the right carrier appetite

  • Structure the right policy

  • Set the right premium

  • Analyze the right risks

  • Recommend the right coverage

You can’t scale intelligently without classifying accurately.

It really is that simple.

 

That’s Why Linqura Built LinqData — The Industry’s Most Accurate Classification Engine

 

We’ve seen firsthand how bad classification data wrecks deals.
So we fixed the problem at the source.

LinqData isn’t just a keyword-matching tool.

It uses multi-layered AI analysis to figure out what a business actually does — not just what it says it does.

Our AI engine looks at:

  • Business name and address
  • Revenue size
  • Website content
  • Job postings
  • Online reviews
  • Industry nuance across layered NAICS subcodes

And when that “landscaper” lists tree removal on their website, LinqData catches it.

It flags it.
It expands the classification.
Before you ever hit submit.

 

The Impact? Fewer Surprises. More Profitable Submissions.

 

With LinqData, you get:

  • Fewer carrier declines

  • Fewer underwriting surprises

  • Cleaner submissions

  • Faster placement cycles

  • Higher profitability per account

 

How LinqData Helps the Entire Insurance Ecosystem

 

For Agents:
You become a specialist on every risk — instantly.
No more guessing. No more praying underwriting doesn’t spot a red flag you missed.

For MGAs:
You stop wasting time on misrouted, out-of-appetite submissions.
Your pipeline gets cleaner, and your placement rates go up.

For Carriers:
You finally get classified, accurate submissions that you can underwrite with confidence.
No more junk data clogging up your systems.

For Tech Partners:
You can build smarter automations, better integrations, and more reliable AI-driven tools because you’re starting with the right foundation.

 

It’s Time to Stop Losing Deals Over a Line of Code

 

You can’t afford to let bad classification derail your deals.
Not in a market where speed, accuracy, and trust are everything.

At Linqura, we believe solving the classification problem is the first — and most critical — step toward building a scalable, profitable commercial insurance business.

Our AI gets it right.
So your people can move fast, act with confidence, and win more.

 

Ready to See How It Works?

👉 Schedule a Linqura Demo Today

See how agents, MGAs, carriers, and tech partners are finally solving the classification problem — and scaling their business with confidence.

Because smart insurance starts with accurate data.
And accurate data starts with Linqura.