Magazine article Risk Management

The Education of a Rookie Risk Manager

Magazine article Risk Management

The Education of a Rookie Risk Manager

Article excerpt

Perhaps like many of you, I was introduced to the risk management profession rather suddenly. Nearly four years ago, I was asked to assist a task force that was exploring the role of risk management within Surrey, a fast-growing residential city near Vancouver with a population of about 300,000. At the time, I had barely heard of risk management, let alone practiced it.

In fact, the importance of risk management was generally unknown throughout the city (except in certain areas, such as the highest levels of management). Insurance-related issues were just one of the many functions performed by the city clerk, and most of the risk management responsibility was assigned to an outside risk management consultant. Most departments had varying degrees of loss control procedures in place, but none of these disparate efforts were being coordinated.

Risk management was generally considered something that would be nice to have, but not something that was needed. This attitude began to change when a number of court decisions started increasing the burden on municipalities to safeguard the public. This burden, combined with a growing perception that public-sector organizations have an endless source of funds to pay for even the smallest of incidents, caused the number of claims filed against the city to reach 400 in 1992--double the number filed just five years earlier.

Because liability insurance became either unavailable or prohibitively expensive throughout Canada, the city began increasing its retention levels and using commercial insurance only for catastrophic exposures. Some exposures were completely self-insured. This approach had worked for a number of years, but it became apparent by 1992 that changes needed to be made.

The risk management initiative came as part of a restructuring of Surrey's municipal government designed to streamline the city's administration. The city was looking to reduce its expenses wherever possible, and the rising cost of liability claims was an obvious target.

I was asked to assume the claims management effort because, as supervisor of property taxes, I had previously assisted the city's consultant with preliminary work in that area. I had also gained some legal experience by prosecuting delinquent tax accounts in small claims court. This experience was helpful, but I still had a tremendous amount to learn.

The first step the city undertook, at the start of 1993, was to create a risk management task force with managers from the major municipal departments. The task force developed a comprehensive policy statement, approved by the city manager and council. that stated the purpose of risk management and outlined the responsibilities of each staff member.

At the same time, I was striving to learn more about the profession. I enrolled in the Certificate in Risk Management (CRM) program at Simon Fraser University and joined the British Columbia RIMS chapter. My knowledge was augmented instantly with the willing assistance of my fellow risk managers. Within six months, I was elected the chapter's program director.

The networking opportunities within RIMS helped me a great deal. Through the chapter meetings, the annual Canadian Risk and Insurance Management Conference and conversations with risk managers throughout Canada, I was able to discuss common problems, policy language and new approaches to managing the city's exposures. The people in the risk management community are extremely patient with newcomers, and they showed a willingness to help and share their experiences that I hadn't seen in other professional organizations.

Promoting Awareness

While I was building my knowledge, the city's risk management task force began to educate employees about how much liability losses were costing the city--and to explain how these incidents could be prevented. In May 1993, we held a Risk Awareness Week that included safety seminars and contests for the best slogan and poster. …

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