Reason Mag Q1 2014 Seite 44

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ROOMS WITH DIFFERENT VIEWS OF RISK Insurers typically have a more simplistic view of a particular risk This will always be the case as the business has a deeper understanding of all the variables that effect risk This view can lead to a tendency for a black and white treatment of the risk versus a shades of grey view from the insured When the understanding overlaps and becomes common to both very posi tive things happen in terms of the manage ment or mitigation of a particular risk The insurers also face the internal challenge of selling a particular coverage position price or amount of capacity or an engineering assessment to underwriting or operational management particularly if judgments are being made against a given standard As a risk manager the continuous challenge is to shift the status quo around a particular risk or situation and in turn convince opera tions to do something different which may require spending and expenses that will not positively impact the cost of goods Change will often be necessary on a cultural level as well to ensure a long term change in behavior Andy Bryson Some of the risks that are well known to insurers may only be encountered rarely or never by an insured The insurer is able to bring his experience of handling these risks to its insured both before the realization of the risk and after Hervé Borel THE BENEFIT OF BUYING AND SELLING EXPERIENCE It s important to see both sides of risk because it ensures that there is common understanding of the risk at hand Once this happens the solution usually presents itself rather than being forced It also helps to build trust and to cement long term relationships which is vital in ensuring a long term improvement in the risks posed to a company Andy Bryson The ability to see risk from both sides helps the insured and insurer understand the needs strengths and weaknesses of each other It forms the foundation for a trusting relationship this works well for both sides Paul Taylor RISK CULTURE AND RISK CONTROLS Insurance alone is not enough to manage business risk In fact insurance is a means of man aging risk for relatively few corporate risks From a business standpoint risk processes and controls need to be embedded in business process from strategy through business operations 44 Reason ISSUE 1 2014