A risk management program is the best way to systematically
reduce the impact of risk.
An experienced commercial insurance broker knows
how to identify and manage many of the risk factors in your
business and translate that knowledge into a cost effective risk
management program. There are four key steps:
1. Know Your Risk Exposures
The first step is to accurately identify and analyze the risk
exposures to your tangible and intangible property, your income,
personnel and liabilities. These can be determined in a thorough
audit of your office, warehouse or shop floor to identify all
perils, probabilities and potential financial consequences.
2. Consider the Risk Management Alternatives
Insurance is one form of "financing" your risk, but there are
other alternatives to explore. These include eliminating the
exposure, loss prevention, loss reduction and contractual transfer
of responsibility for losses, for example, when a lessee assumes
the liability for damages to leased space. A thorough risk
management plan will examine all these alternatives before getting
to the issue of insurance. Commercial insurance is the most widely
used of all risk financing techniques because of the cost-effective
protection it provides. General and specialized policies can cover
just about any peril. Another way to manage risk is to be
financially prepared for a loss. One way to do this is to
accumulate your own capital reserves to cover the loss, but this
can tie up large amounts of capital at low rates of return.
3. Implement Your Plan
With loss prevention and reduction plans in place, your broker
can help you implement your insurance program with one or multiple
insurers.
4. Monitor and Adapt Your Plan
Make sure to adapt your plan to match the changes in your
business including geographical expansion, physical growth, new
lines of business or increased complexity. Consider an annual
review of your needs with the help of your insurance broker.
Your Rhodes & Williams commercial insurance broker has the
experience to help you manage the insurance risks in your business.
We have many ready-made loss reduction techniques and programs
including; fleet management, slip & fall protection, and
disaster recovery planning. Talk to your insurance broker - we are
here to help.