Magazine article Risk Management

Dear RM

Magazine article Risk Management

Dear RM

Article excerpt

In the ongoing debate about the viability of the Quality Scorecard, the question has been asked: How can we evaluate not only service providers but ourselves? In a response to this debate, the Dallas/Fort Worth chapter of the Risk & Insurance Management Society, Inc. sponsored a survey of brokers and underwriters in the fall of 2000 to obtain their opinions about the abilities and performance of risk managers. The DFW chapter loosely modeled the survey after the Quality Scorecard sponsored by RIMS and The Quality Insurance Congress.

A survey committee of three brokers designed the survey questions and the format, with my input as a risk manager. The brokers were Jim Farley of Marsh, John Deal of Aon and Pat Arthur of McQuery, Henry, Bowles, and Troy. They distributed the survey questions to two hundred brokers and underwriters, the majority of which are based in Texas.

Each broker and underwriter was asked to evaluate two risk managers that they currently had as clients. (The survey did not ask for the names of the risk managers and they were not identified in any way.)

The survey committee received responses evaluating 154 risk managers. Although the results are not statistically sound, the responses provide credible information. The following are three sample questions and their results:

Does the risk manager understand alternative risk financing? From the survey alone, we do not know whether 28 percent of the risk managers evaluated seem to have failed to investigate alternative risk financing when they should have, or whether they investigated it ineffectively. Either situation would indicate the need for many risk managers to better educate themselves in this emerging area.

Does the risk manager have strong technical knowledge of coverages and policy forms? Even while risk managers are developing many new areas of responsibility, insurance remains the primary duty for most. When 25 percent of the risk managers evaluated appear to lack strong technical knowledge of insurance, it could mean our professional education and development should focus more on this fundamental component.

Does the risk manager understand and utilize loss control techniques effectively? If only about half of the risk managers evaluated are seen by underwriters and brokers as performing well in this important area, and about one quarter are seen as not performing well, it could again mean that many risk managers need more training in this fundamental component of risk management. …

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