The risk management process can be a complicated undertaking in today's world. With global catastrophes such as a pandemic, cyberattack, or supply chain disruption affecting not just your company and employees but also your customers, suppliers, and the economies in which you operate, it becomes much more challenging.
It is challenging to manage a successful insurance and risk program without an integrated management approach. Let us show you how it is accomplished.
Benefits of an Integrated Approach
Solves complex problems
Optimizes coverage and compliance
It helps you navigate change
Risk Management Defined
The process of discovering, assessing, treating, and controlling threats to an organization’s capital, property, employees, and profitability is known as risk management. Financial uncertainties, legal liabilities, strategic management failures, accidents, and natural disasters are only some of the hazards or risks that could arise.
How Does Insurance Relate to Risk Management?
Insurance is one method of treating your risk. But with an integrated risk management approach, you discover and understand other ways of managing your risk.
Key Strategies of Risk Management Consulting
The Risk Management Audit
Your insurance programs (property and casualty, worker's compensation, D&O, E&O, general liability, cyber, etc.) and related exposures should be thoroughly assessed by risk management specialists who are experienced in this area. This helps you understand what your present coverage does and does not provide in relation to your risk or exposure.
The risk audit also reviews, compares and evaluates your operational risk exposures to determine if you have exposures that are not being addressed. The audit helps you identify new or existing laws, contracts, obligations, COVID19 requirements, and or statutes that would impact your operations.
It is essential to identify any operational exposures you may have that are not covered by insurance.
A Comprehensive Review of Your Commercial Insurance
When was the last time you had a third party perform a review of your commercial insurance coverage? Insurance policies have exclusions, terms and conditions, and other limitations. The audit can reveal coverage issues and help you determine an appropriate course of action. This can and should include also looking into new providers or programs that might address your coverage needs.
It is important to examine your coverage regarding how risk is transferred and assumed by your business through various contracts and agreements and whether your insurance policies offer the best management of the risks involved.
Then you can determine if you need to modify your existing contracts and agreements or change your insurance coverage to match your risk.
Program Design and Strategy Development
You can begin selecting a risk and insurance strategy for each key risk area after knowing how much you are willing to take. You can:
Avoid the risk. Stop activities that create too much risk.
Reduce the risk. Take the necessary steps to reduce the likelihood of a loss or event occurring. This might include safety training, contractual review, and increasing insurance deductibles.
Transfer the risk. Take out commercial insurance to help cover the risk. Transfer through contracts.
Accept the risk. Agree to take the risk and manage it as best you can.
Planning and Implementation
Now that you've identified your risks assessed their severity, and devised a plan of action? Now implement your plan with the help of your agent. Frequently, this entails a process of change, such as increased safety awareness, training, establishing safety policies, and updating insurance.
Changes in risk management must follow the same continuous improvement strategy as with other aspects in your organization. Your risk management program will fall behind if you do not improve your plan as your firm develops and grows.
Free Guide: California Worker's Comp Best Practices
Leap | Carpenter | Kemps Insurance Agency Can Help
Leap l Carpenter l Kemps Insurance agents and consultants have helped many businesses establish, plan, and implement successful risk management and insurance strategies. Contact us today for more information on the advantages of risk management consulting services or to schedule a consultation with a professional expert.
Shawn Dwyer specializes and has a deep understanding of captive insurance, workers' compensation insurance, general business insurance, and safety and risk management.
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Leap | Carpenter | Kemps Insurance Agency provides Commercial Business Insurance, Employee Benefits, Life and Health Insurance, and Personal Insurance to all of California, including Merced, Atwater, Los Banos, Mariposa, Madera, Fresno, Modesto, Turlock, and Stockton.
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