Real World Lessons: By Maximizing Relevance in Risk Management Education Programs, Schools Are Drawing in More Students for a New Class of Risk Managers

By McDonald, Caroline | Risk Management, September 2014 | Go to article overview

Real World Lessons: By Maximizing Relevance in Risk Management Education Programs, Schools Are Drawing in More Students for a New Class of Risk Managers


McDonald, Caroline, Risk Management


Risk management is more important than ever in today's corporate world. With lessons learned from the financial crisis still fresh and the total cost of risk up by almost 15% since 2009, according to the most recent RIMS Benchmark Survey, organizations and their boards are focusing more than ever on corporate risk management and searching for ways to mitigate and insure their risks. What's more, growth and employee turnover in the insurance industry also mean a greater number of employment opportunities.

None of this is lost on university risk management and insurance (RMI) educators who know they have much to offer. They also realize that their main task is to attract students and bring life to an industry students know very little about and often perceive as dull.

"Few people coming in the door know what risk management is, because an 18-year-old has only had exposure to auto insurance," said Rob B. Drennan, Ph.D., associate professor and chairman of the department of risk, insurance and healthcare management at Temple University's Fox School of Business. "We know this because, every time they answer a question, it's related to auto insurance."

Temple has found that learning about risk management means making converts. Once students hear their message, many are drawn to the program. To attract students, the department has a strategy that has proved successful: all 2,000 students of the Fox School of Business pursuing an undergraduate degree each year are required to take an introduction to risk management course in their sophomore year. Because the course is key to engaging students in risk management and the insurance industry, "We teach the course very carefully," Drennan said. "This past year, the twist is that we have focused on several public policy issues."

The first class discussion is about the impact of risk on a firm's value and how managing those risks can help. Next, "we talk about current public policy issues related to how society finances losses," he said. "We discuss TRIA and the national flood insurance program from a public policy perspective. Should you, for example, give people disaster relief if they build a house on the Jersey shore and it keeps getting wiped out?"

Another big topic is cyberrisk. "The kids shop at Target and they know what happened," Drennan said. "They have talked about it in other classes, but we look at it from a risk management perspective--what kind of losses, how would you deal with them and what kind of insurance would you have? Also, how easy is it for the insurance industry to put a price tag on cyberrisk?"

At the end of the semester, there is a strategic plan to sit down and conduct information sessions. Students who attend those sessions are invited to consider majoring in risk management. Out of a class of 250 students, 25 are targeted for the program. "This is one of the first courses they encounter in business school where they have to think critically, as opposed to memorizing facts," Drennan said. "Good students with critical-thinking skills are really drawn to this."

The department's efforts have paid off. This past year, the number of risk management graduates was up to 210, from 140 last year. "Our biggest challenge now is that we have waiting lists for our classes, which gives us a different kind of enrollment problem--a good problem to have," he said.

At the University of Wisconsin, undergraduate students become interested through classroom discussion about key issues. "We spent a lot of time during the spring semester talking about cyberrisk, which was just after the Target security breach," said Joan T. Schmit, Ph.D., American Family Insurance Chair in Risk Management and Insurance with the Wisconsin School of Business. "We discussed all the elements that can be affected, including supply chain."

At the University of Georgia, on-campus recruiting for risk management and insurance majors "continues to be very strong," according to Robert E. …

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