IRMI Update—Issue #19
An E-mail Newsletter for Risk and
Insurance Professionals
ISSN: 1530-7948
June 19, 2001
In This Issue
Colleague,
Responding to my comments in IRMI Update #4 about agents and
brokers providing value-added services, a reader voiced concern
about an insurance agent or broker also acting as a consultant because
of the conflicts of interest that arise.
Can an agent profess to both give consultative advice and represent
the insurer? Will an agent or broker recommend self-insurance even
in the face of lost commissions? Must not-so-complimentary information
learned in performing a risk control study be reported to the underwriter,
possibly to the detriment of the client? Can an agent objectively
help an insured choose between competing proposals from other agents,
even if that agent has not submitted a bid?
I began my career as an independent risk consultant, and we touted
the fact that we did not sell insurance as a major reason why clients
should hire us. One of the things I remember most about those consulting
engagements was having agents thank me for recommending something
they had been trying to get their clients to do for years. The agents
had been ignored, but our recommendations were acted upon, perhaps
because we had more credibility when it came to such advice. But
nevertheless, the agents had made the recommendations.
Over the years I've concluded that professional agents try very
hard to provide their clients with the best possible advice, regardless
of their own short-term financial self-interest. Doing so is not
only a matter of integrity but also of good business judgment. Providing
reliable advice is the only way to build the client loyalty that
is the key to success.
What is your view? Can agents and brokers provide credible and
unbiased consultative advice? When should you bring in an independent
consultant? [See
reader
comments]
Have a great day.
Jack
Jack P. Gibson
President
IRMI
Make Sure You've Covered Computer Security
Basics—Despite highly publicized hack attacks, viruses and
distributed denials of service, the most common security breaches
in networks occur in much more mundane settings. Employees leaving
their networked computers on while they're away from their desks,
disks stolen by visitors, and transparent passwords are far bigger
security threats than bands of hackers.
Proper password safeguards are particularly important. Many employees
choose simple passwords, leave them written on sticky notes attached
to their computer monitors, or worse, never choose them at all.
Some network administrators report that the most common passwords
on their systems are "password" and "default"—a fact that would
probably not escape even a casual data thief. Some companies help
minimize that particular risk by insisting on new passwords every
week and requiring users to choose hard-to-guess passwords, a task
the risk manager can assist with and encourage.
The risk manager who takes a proactive role in basic technology
security measures will find it easier to buy insurance, and easier
to understand what's being bought.
By: Donna Ferrara, Esq.
Vice-President
Arthur J. Gallagher Risk Management Services
New York
e-mail:
Suggest a Risk Tip.
Future issues of IRMI Update will include more risk tips from our
readers. Send us a practical tip (less than 300 words) for identifying
and managing risks, buying insurance, managing claims, or filling
gaps in insurance coverages. We'll acknowledge your contribution
as we did for Donna.
We add new Expert Commentary to IRMI.com every week. There are
now 149 articles on IRMI.com, and many more are in production. Below
you'll find summaries of some recent additions with links to the
articles.
-
Workers
Compensation and Medicare—Medicare now
believes there has been an illegal shift of medical
benefits from workers compensation insurers to Medicare.
To stem this flow, Medicare hopes to examine all
workers comp settlements, even when claimants do
not qualify for Medicare benefits. See what may
be in store in this controversial area.
-
Back to the Exclusions—The "Subcontractor" Exception—The
"your work" exclusion of the CGL policy, together
with its "subcontractor" exception, are the source
of great contention in construction defect cases.
This article looks at the question of whether coverage
exists for property damage arising out of work or
materials supplied by other than a traditional subcontractor.
-
The Brazilian Insurance Market—Brazil
has been undergoing a political and economic process
of change since the early 1990s, which is reflected
in its insurance market. Learn about its insurance
market—its structure, regulatory environment, how
various coverage lines are handled, and its profitability.
-
Sales
Call Reluctance: All Dressed Up, Nowhere To Go—Lack
of clear career goals is a common problem found
in many under-performing salespeople. Their careers
are lackluster and mediocre. This article examines
characteristics of Low Goal Salespeople and what
can be done to motivate them.
-
Admiralty Jurisdiction: A
Challenge for Even the
Seasoned Practitioner—Determining
whether admiralty jurisdiction exists over a particular
claim can prove extremely challenging, even for
those well versed in admiralty law. This article
examines the history, landmark cases, and how to
determine where the baseline exists on a coastal
state.
What Does "Separation
of Insureds" Mean?—Part 1—Most liability insurance policies
contain a "severability of interests" condition, which stipulates
that coverage applies "separately" to each insured. This article,
and the two to follow, examine coverage issues raised by this condition
in the ISO CGL policy.
CRC Agenda Now Online—The
agenda for the 21st IRMI Construction Risk Conference is now available
for viewing online. Check out the planned seminars and workshops
at the link. We will begin accepting registrations in August.
New IRMI WC CE Course
Online—"IRMI on Workers Compensation Insurance" is now
available online, for those in need of both CE and a challenging
read. So many CE courses are at the introductory or basic level,
making them a supreme waste of time. IRMI uses advanced reference
material to put the "education" back in continuing education. See
other IRMI courses that are available on IRMI.com.
New! Blueprint
for Workers Comp Cost Containment—Drawing on his
20 years of safety and claims management experience, author Martin
F. McGavin gives you tried and true strategies and tactics for bringing
escalating workers compensation costs under control. This timely
book will pay for itself over and over again. Go to Products & Services
to see the table of contents or to order your copy.
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