IRMI Update—Issue #36
An E-mail Newsletter for Risk and Insurance Professionals
ISSN: 1530-7948
March 5, 2002
In This Issue
Colleague,
Recently I had the pleasure of speaking at an Insurance Symposium at the
University of Mississippi. It was unique in that it brought insurance professionals
together with students to explore and learn about industry issues. It always
inspires me when I meet young people who are actively studying insurance and
planning to pursue careers in the industry. These are the people who may take
the industry to new heights.
The industry will derive many benefits if risk and insurance programs at
our colleges and universities survive and grow. If you don't already do so,
please support them. The best way is to hire the graduates of these programs.
In return, you will be getting a bright young person who has already committed
to the industry. Of course, you can also contribute to scholarship funds and
participate in career days and other campus events.
On another topic, many thanks to those readers who provided security tips
in response to last month's IRMI Update. We'd like to receive more tips on how
to make businesses safer for employees and customers, whatever the industry.
Thank you for your trust and confidence. Have a great day.
Jack
Jack P. Gibson
President
IRMI
Reduce Risk with Subrogation Waivers. Waivers
of subrogation are clauses in the insurance requirements of business contracts
that prevent one party's insurer from subrogating against (suing) the other
party to recover a loss it paid. They can greatly reduce risks by identifying
which party is supposed to insure the risk and prohibiting that party's insurer
from trying to circumvent the intent by suing the other party for causing or
contributing to the property loss. They have long been used in real property
leases to allocate responsibility for insuring the leased property to either
the tenant or landlord.
They also have uses in construction contracts. These contracts should, for
example, specify which party is responsible for insuring the project and waive
subrogation against all other parties involved with constructing the project.
Homebuilders may use them to reduce their completed operations exposures. To
protect the homebuilder from future subrogation from the owner's homeowner's
insurer, a waiver of subrogation of the insurer's rights can be included in
the sales contract.
Whenever you are reviewing a contract that requires one party to purchase
some form of property insurance, consider whether it is advisable for the insurer's
right to subrogate against the other party to be waived.
By: Don Avera
Commercial Account Executive
TCT Insurance Services, Inc.
Dallas, TX
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
give you credit for your contribution.
There are now 266 articles on IRMI.com, and many more are in production.
Below you'll find summaries of some recent additions with links to the articles.
-
Achieving Workers
Compensation Savings through Medical Bill Repricing—Medical bill
repricing leads to legitimate and real workers compensation savings, but
it does have its drawbacks. Martin McGavin examines the process, including
its strengths and weaknesses.
- What Your Fire Department Should Know about
Your Fire Protection Systems—In this new property risk control column,
William Fries explains the importance of inviting firefighters to your facilities.
That way, they can familiarize, educate, and train on your suppression systems
before a disaster.
-
The Insurance Business
Is Not for Sissies!—In his Insurance Rx column, Gary Bausom takes
a look at where insurance companies are headed after 9/11, what they can
expect to find, and "ingredients for success."
-
The Pitfalls of Accepting
Contaminated Fill—What happens when an earthwork contractor accepts
fill material at the site to establish proper elevations only to discover
later that the "clean fill" is anything but? Jeff Slivka provides ways to
control the exposure.
-
Anything You Say (or
Do) Can and Will be Held Against You in a Court of Law—In this
article, Sanford Warren informs readers of some of the potential pitfalls
that await the patent holder along the road from first conception of the
invention to final expiration of the patent.
Credit-Based Insurance
Scoring: A Simmering Debate. With consumer groups squarely and vehemently
lined up against the insurers, and regulators caught in the middle, compromises
on this issue are virtually assured.
New IRMI Book Focuses
on Captives—Captives and other alternative risk transfer (ART) vehicles
warrant careful consideration in hardening insurance markets such as we now
face. Written by an ART veteran, IRMI's newest book,
Captives and the Management
of Risk, is designed to help captive newcomers and seasoned pros
alike understand when it does and does not make sense to use captives and how
to get the most from an existing captive. Click on the title to see more information
and a table of contents.
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