INSURANCE MANAGEMENT

Insurance Management

We believe that insurance is a controllable expense. Through the proper strategic management of an insurance program, the cost can be successfully influenced for the benefit of the insured.

One of the primary strategies for risk management is risk transfer. This risk management and control strategy involve the contractual shifting of a pure risk from one party to another. Insurance policies are a primary tool, by which a specified exposure to loss is passed from the policyholder to the insurer. Here are some areas in which we can help:

Specifications and Marketing

Determining and specifying the appropriate insurance coverage and program structure is key to managing the cost of insurance. In doing so, it is important that there is a full understanding of business operations so that the coverage can be tailored, as appropriate to meet the needs of the company. Additionally, while Strategic Risk Advisors is an advocate of developing underwriting and service team relationships, oversight of this process helps to ensure that complacency on the part of the insurance broker does negatively impact an insurance program. Equally important, however, is that each insurance policy not be competitively marketed every year.

Coverage Evaluations

In many cases, companies will simply renew their existing insurance policies from year to year without reviewing changes that may have taken place in business operations. As the business direction and strategies evolve, so must the insurance program so that it continues to provide the financial protection for which it is intended. Strategic Risk Advisors is able to assist with this evaluation of business operations and insurance coverage to assure that a cost/coverage effective insurance structure is in place.

Alternative Funding Analyses

There are times when a fully-insured first-dollar insurance program makes a lot of sense and is cost-effective, but there are also situations when the optimum solution may include increased deductibles, captive insurance, or another form of alternative risk transfer. Risk Management is not simply determining what exposure can be insured, but in some cases, the answer may be a determination as to what should be “self-funded”. Strategic Risk Advisors has supported clients in the evaluation and effective implementation and management of fully insured, high deductible, and captive insurance solutions.

Contract Review/Risk Transfer

Part of the Risk Management process and a critical component of managing an insurance program incorporates reviewing various contracts and when the possible transferring risk to another party other than an insurance company. We have found that loan agreements, leases, construction documents, and service/supplier/sales agreements often include substantial risk transfer through the indemnification and insurance provisions. It is important that these be looked at in the context of the entire agreement as well as how they relate to each other, and not in isolation. Strategic Risk Advisors has extensive experience in assisting clients with contract negotiations including hotel management, property management construction management, leasing, loans, franchise, and many other types of agreements.