RISK MANAGEMENT ESSENTIALS MO/KS PRIMA CONFERENCE April 17, 2015 Linda Minson [email protected] Mick McBride [email protected].

RISK MANAGEMENT ESSENTIALS

MO/KS PRIMA CONFERENCEApril 17, 2015

Linda [email protected]

Mick [email protected]

Low Probability Low Severity

Low ProbabilityHigh Severity

High ProbabilityLow Severity

High ProbabilityHigh Severity

HOW SHOULD YOU DEAL WITH RISK

IgnoreAvoid

Internal Funding

IgnoreAvoid

Internal Funding

Transfer Risk InsuranceContract

Transfer Risk Insurance Contract

Low Probability Low Severity

Low ProbabilityHigh Severity

High ProbabilityLow Severity

High ProbabilityHigh Severity

How Do You Handle Risk Of Loss?

Risk Management Responsibility

• IN THE EVENT OF AN ADVERSE EVENT YOUR• RISK PLAN • should • PROVIDE • adequate • RESOURCES (MONEY)• to pay the financial consequences of the

event.

Insurance Agent Responsibility

• IN THE EVENT OF AN ADVERSE EVENT YOUR

RISK CONSIDERATIONSContinuity of Operations (COOP)

Self Insurance vs Insurance

Risk Transfer by Contract

Enterprise Risk Management

How To Start (Decide)

• Which Risks Are Currently Not Insured? Read your insurance policy exclusions/limitations.– Intentionally caused– Protect property Before or After Loss– Vacant property– Earthquake, earth movement, flood, war,

terrorism, nuclear radiation, mold, broken water main, mechanical breakdown, electrical arc, building code, margin clause, concealed carry

– Margin Clause

DECISION TIME

• QUESTION:

• WHAT HAPPENS TO YOUR INSURANCE PREMIUM IF YOUR LOSS RATIO APPROACHES 50%?

DECISION TIME

• QUESTION:

• WHAT HAPPENS IF YOU HAVE TO TELL YOUR BOSS ANOUT A PREMIUM INCREASE?

SUMMARY

• You are already doing self insurance. How much is the real question.

• Should you modify your RISK PLAN to include more or less self insurance?

• Can you overcome the barriers?

• Can you COMMUNICATE your Risk PLAN to others?

QUESTIONS