IRMI Update—Issue #164
An E-mail Newsletter for Risk and Insurance Professionals
ISSN: 1530-7948
July 11, 2007
In This Issue
Message from the Editor
Colleague,
Who said the insurance industry is not competitive? How anyone with knowledge
of the industry could make this assertion has always been beyond me. (Generally,
most who assert it do not understand the industry or view a single year in isolation.)
The extreme competitiveness of the industry coupled with the unpredictability
of the ultimate cost of delivering its product (i.e., claims payments) is the
ultimate cause of the up and down pricing cycles the industry has experienced
for many decades.
Competition has been driving insurance rates down since the hard market peaked
in late 2002. The primary exception seems to be insurance on property in catastrophe
exposed areas, but there may be a few signs of competition there as well. IRMI
research analysts are currently surveying their industry contacts as work on
producing our annual market review, which will be published in
The Risk Report this fall.
In the meantime, we would like to know what you think. Would you call this
a "soft market" or simply a softening market? Are insurers being irrational
in their underwriting, or are they being wise in their responses to competition?
Should insurance buyers shop their insurance now to get the best deal or stick
with their current insurer to maintain the relationship? What about coverage
terms? Are you seeing competition lead to broader coverage as well as reduced
prices? Please [See reader responses.]
On another topic, the 27th IRMI Construction Risk Conference will take place
in Orlando on October 29-November 1, 2007, and we are now taking registrations.
As the only national symposium dedicated exclusively to construction risk management,
insurance, and surety, it will bring together some 1,500 risk professionals
for a one-of-a-kind learning and networking opportunity. I hope to see you there.
You can learn more or register here.
Thank you very much for subscribing to IRMI Update. Please recommend it to
your friends and colleagues.
Have a great day.
Jack
Jack P. Gibson, CPCU, CRIS, ARM
President
IRMI
Risk Tip
Build Effective and Deep Relationships with Insurers—Companies
don't underwrite, people do. So building relationships with your underwriters
is vital to designing and maintaining a program that will consistently achieve
your organization’s risk financing goals.
Building a relationship involves getting to know the underwriter and making
them part of your team. Meeting with underwriters when negotiating renewals
has become a fairly common practice, and that is certainly critical to achieving
the best results. However, extra effort should be made to develop and strengthen
the relationship.
Find opportunities to meet with the underwriters at other times. Invite them
to visit your locations, to meet with your senior management, or to participate
in local industry events. You also should consider expanding the relationships
beyond the underwriter to management of the insurer. Then if there is turnover
with your underwriter, you do not lose the relationship. If it is difficult
to schedule face-to-face meetings due to time or travel constraints, then scheduling
periodic calls with the underwriter can be beneficial. These can be used to
provide updates on the organization, maintain open communication, and show them
that you value their input and support.
The long-term relationships that you build will yield benefits for your account.
If there is a change in your broker/agent but you want to maintain your insurer,
having a strong relationship with the insurer will facilitate transition to
the new team and assure that you do not lose your investment in positioning
your account in the market. If a difficult issue arises, a strong relationship
may be the difference in reaching a favorable or at least an acceptable compromise
resolution to the issue.
Drawn from
Practical
Risk Management, Topic A-5, Marketing a Large Account.
IRMI Online subscribers will find it here.
SilverPlume Sage subscribers will find it here.
Suggest a Risk Tip. Send us a practical tip (less than 300 words) for identifying and managing risks,
buying insurance, managing claims, or filling gaps in insurance coverages. Submit your tips. We'll
acknowledge your contribution.
What's New in Your IRMI Library
We have recently updated a number of the reference manuals in the IRMI library
and published new issues of The Risk Report and Captive Insurance Company Reports.
To make sure you don't miss any of this new information take 30 seconds to scan
the "What's New" summary page.
For IRMI
Online and Print subscribers.
For SilverPlume
Sage subscribers.
New Expert Commentary
There are now over 900 risk management and insurance articles on IRMI.com.
Below you'll find summaries of some recent additions with links to the articles.
Register for the IRMI Construction Risk Conference
The 27th IRMI Construction Risk Conference is October 29-November 1 at the
Orlando World Marriott Resort. Save $125 when you register online before August
17. Don't delay—the last two Conferences have sold out! See the agenda for 28 workshops
led by more than 60 industry expert speakers.
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