INSURANCE RISK MANAGEMENT Risk Avoidance Loss Control Separation

INSURANCE RISK MANAGEMENT Risk Avoidance Loss Control Separation or Combination Risk Transfer INSURANCE RISK MANAGEMENT

INSURANCE RISK MANAGEMENT Risk Measurement l Identification of the risk exposures l Find the best method l Apply the best method of risk prevention control method. Previous Next

INSURANCE RISK MANAGEMENT Measuring Risk to know; l l l Actual value of the Investments and projects Economic Feasibility of the investments The special hazards The most efficient risk control method to use The company savings (e. i premium, tax) Previous Next

INSURANCE RISK MANAGEMENT Risk Measurement Methods l l l l Underwriting Loss Control check list Risk Analysis Questionnaires Financial Statement overview and special hazards The Flow Chart Method On-site inspections Periodic employee interactions Statistical records of previous losses Analysis of the enviroment of the plant or projects Previous Next

INSURANCE RISK MANAGEMENT The Best Method of Risk Measurement for identification No single method or procedure is the best method to find the risk identification and fullproof. l All industries may require several methods at the same time. l Size, nature of business, in-house expertize are the main parameters l Previous Next

INSURANCE RISK MANAGEMENT Dimensions of Risk Measurements l Loss-Frequency Measure l Loss-Severity Measures Previous Next

INSURANCE RISK MANAGEMENT Risks are to be measured? l Property losses l General Liability losses l Personnel Losses Previous Next

INSURANCE RISK MANAGEMENT Why is the risk control if can not be avoided? l Make losses more predictable l Minimizing the expected losses Previous Next

INSURANCE RISK MANAGEMENT Avoiding and Controlling A non-transferable and/or unretainable risk is to be avoided by the company or, l Measured risk can be evaluated and loss prevention methods can be applied. l Previous Next

INSURANCE RISK MANAGEMENT Loss Control Measures l The cost l The benefits l The evaluation l Decision to implemet the control method l Periodic Controls Previous Next

INSURANCE RISK MANAGEMENT Separation and Combination Dividing the risk exposure where the final measuremet and study has been completed for a final decision l Merging and combining the risk exposures to be controlled at a maximum level. l Previous Next

INSURANCE RISK MANAGEMENT Risk Transfer Methods Retention l Captives l Purchasing Employee benefits plans l Purchasing Insurance Cover l Previous Next

INSURANCE RISK MANAGEMENT Retention l The most passive and unplanned metod to be applied as a risk control after the full risk measuremet and surveys are completed for; l l Risks with the known cost if transfered. Risks with a known expected loss Previous Next

INSURANCE RISK MANAGEMENT Captives l Creating and establishing a reinsurance company by the insured in overseas to obtain; savings up to 25% of the annual insurance premium payments depending on the loss history. l tax benefits in overseas up to 5% tax vs local of 40% tax payments l A possible foreign Investment Income up to 10% from the tax and premium savings l Previous Next

INSURANCE RISK MANAGEMENT Employee Benefits l Purchasing full coverage for personnel for accidents, travel, and retirement where the company will face the losses. Previous Next

INSURANCE RISK MANAGEMENT Insurance l The Purchased coverage as per the final risk mesaurement and control method for the risk exposures by knowing the ; l l Exposures Premium expense Advantages The best terms and conditions of the coverage Previous Next