If, like most risk and insurance professionals, your organization provides you with a subscription to IRMI reference services in SilverPlume Sage, IRMI Online, or perhaps in print, you may have access to a vast storehouse of risk finance information, tactics and strategies. Our flagship reference on this topic is Risk Financing, and you'll be pleased to learn that we just released the annual update of some of the most important information in the manual. This includes the loss development factors, payout profiles, and U.S. claims cost indexes (often called the "Masterson Indexes"). Be sure to use the latest factors when working on your loss picks and other risk finance analyses during the first quarter 2009 renewal season. (If you subscribe in print your supplement, #99, may still be in the mail.)

Other titles in the IRMI risk finance library include:

Captives and the Management of Risk
Captive Practices and Procedures
Captive Insurance Company Reports

If you don't subscribe to these publications, learn more about the IRMI risk finance library here.

Will you be at the IRMI Construction Risk Conference in Las Vegas next week? If so, get ready for some great educational sessions and networking with 1500 of the top construction risk professionals in the world! I look forward to seeing you there.

All the best,

Jack

Jack P. Gibson, CPCU, CRIS, ARM
President
IRMI

Risk Tip

Get the Most from Your TPA—With high case volumes, increased responsibilities, and a competitive environment where profits are razor thin, adjusters are pulled in many different directions. This makes it a challenge for risk managers to ensure that their files receive the attention they demand and deserve. The "trick" is making sure your files reach the top of the stack so that the adjuster handles your cases first! I've seen adjusters move heaven and earth to help clients they respect and admire, who are easy to work with, who help the adjusters do their jobs more easily, and who appreciate the tough role the adjuster plays in bringing all the players into agreement on claim resolution. As a risk manager, you can stand out by complimenting good work—to the adjuster's supervisor or higher; by getting to know your adjuster in such small things as a birthday or an anniversary card; or to get the adjuster to identify with your company, give the adjuster a logo item from your company. In my experience, it's not the grand gesture that makes the relationship, but the everyday little things you can do to make the adjuster want to do things for, and with, you!

By: Elise M. Farnham, CPCU, ARM
President, Illumine Consulting
Grantville, GA

*Elise is a new IRMI.com Expert Commentator. Be sure to check out her new Personal Lines Claims article.

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 as we did for Elise.

What's New in Captive Insurance Company Reports

The October issue of Captive Insurance Company Reports features two case studies: "Raffles Epitomizes Group Captive Evolution," focusing on the largest heterogeneous group captive in the world, and "Captive for Protecting Bonus Plans" on how Adidas AG has used its captive to protect its operating businesses from unexpected prize money payouts.

For IRMI Online subscribers

For SilverPlume Sage subscribers

New Expert Commentary

There are over 1,100 risk management and insurance articles on IRMI.com. Below you'll find summaries of some recent additions with links to the articles.

Disclosing Policy Limits in Liability Claims—Tim Ryles asks whether failure to provide personal policy limits information in the absence of litigation establish a case for bad faith.
Care, Custody, or Control Exclusion in the CGL—Craig Stanovich describes how small changes in circumstances can result in totally different outcomes as to whether property is in the care, custody, or control of the insured.
Hurricanes, Tropical Depressions, and Floods: Risk Management and Insurance—William Austin examines coverage needs and expectations that must be addressed pre-loss, not after the loss event through litigation.
Personal Lines Property Loss Adjusting—The steps involved to achieve claims closure involve knowing the policy, the contract, textbook answers, and alternatives. Elise Farnham explains.
Taxes and Insurance Captives—Michael Mead reminds us that captives should not be formed solely for tax benefits. That said, he relates some tax code exceptions with cautionary notes.

Do Your Contracts Properly Protect Your Company?

Contractual Risk Transfer from IRMI is the industry's most thorough explanation of how to allocate risks in all types of contracts. You'll save hours of drafting time with "boilerplate" insurance clauses. Use the state-by-state analyses of how the courts interpret hold harmless and indemnity clauses to bulletproof your clauses. Explains when and how to require additional insured status. Plus, many more strategies to protect your company! Learn more about Contractual Risk Transfer and subscribe today.

Your View—Insurance Training and Continuing Education

IRMI Update 193 asked whether the industry's apparent inattention to training and education is an issue of concern and what individuals can do to assure they continue to develop expertise even when their employers don't require or provide training assistance. Below are some of the responses from readers.

The dilution of training at the company level has concerned me for some time. They seem to train by teaching just enough to do a specific job and little or nothing on a continuing basis. Agency training seems to vary from none to very good. The agency problem is attracting and retaining teachable people not lack of willingness to train them. Many young employees have too much going on to sign up for more than the minimum. We need to find and promote the available education offerings definitely including online. I hesitate to say we need to reward it in salary, because there are superstars here and elsewhere who do not have designations. But a one-time payment per completed course makes sense. Those who require or encourage continuing ed should but won't toughen the requirements. Why should a commercial lines account manager be able to satisfy requirements by attending a homeowners class? Yes I know it can be relevant, but wouldn't it make more sense to concentrate on topics that enhance work performance?

—Seeman Waranch, President, Insco Group, Inc., Virginia Beach, VA
Early in my insurance career, I was fortunate enough to work for someone who became a mentor to me. He encouraged me to pursue an education in insurance. That was in 1983, and I have never stopped pursuing it. These days, I pack a lunch and do the majority of my studying during my lunch break. (This also saves money!). Last year, I became involved in my local CPCU Chapter and am now serving as a director on the board. It is rewarding to encourage people to continue their education in insurance and exciting to help people become the best that they can be. No matter how you are perceived in your particular workplace, your insurance education is something that no one can take away from you. The thing I like the most about insurance education is that it helps me better serve the independent agents that depend on me.

—Patty Black, CIC, CPCU, AU, AIC, AIS, Commercial Underwriter, Grange Insurance, Columbus, OH
One of the ways in which individuals can continue to develop personally is through self-study courses, networking, and attending any free risk management and/or insurance seminars offered in their local areas.

—Gertrude M. Branch, Senior Risk Management Analyst, American Red Cross, Washington DC
I think that education is the key in any endeavor, but especially in the changing world of insurance. I have asked many brokers who want to handle our account as well as carriers who might want to write our business what they're doing for educating, training, recruiting and retaining a new generation of insurance and risk management professionals. The response that I've gotten varies—one national broker told me that it was difficult to hire those just out of college because they were supposed to be productive to the bottom line within a quarter of being hired. This seems quite short sighted to me. Another one has an in-house "school" that requires 2 years of attendance, I think.

I don't know how anyone could be in this business and not feel the need for continual education. I've been in this business for 35 years and work diligently at keeping abreast of current events and current trends in the industry. I don't think that anyone—broker, risk manager, underwriter, loss control, or claims person—can exist very long in a vacuum.

—Becky Walker, Risk Manager, D E Harvey Builders, Houston
Absolutely, education must be a focus in this day. All one has to do is to look across the aisle at the mortgage banking industry to see what a lack of knowledge in one's product can do to the company, much less the economy. Add to that our efforts to be taken more seriously as an industry, especially from the agency side, to be viewed truly as professional experts in the field of risk management. Well guess what? Our efforts at elevating our image have been successful to a large extent, and with that come the responsibility to be able to perform to the level we have advertised. Education and skills development are the only ways to meet the new expectation in the marketplace.

—Eric Pike, Sr. Underwriter, Personal Lines, Penn National Insurance, Greensboro, NC
One thing that has always struck me as odd is the lack of education direct from companies. I would like to see companies offer more direct training for their agents. General online training is good to advance certain knowledge, but it lacks a further in-depth guide to what agents (especially those newer to the industry) need and what companies are looking for.

—Robbie Ryan, ACSR (P/C), CISR, Principle/Producer, The Ryan Insurance Agency, Rowlett, TX
Being an "experienced" insurance industry professional, the failure to train and support continued educational growth within the industry is simply astounding. When I entered the industry with Aetna C&S, we spent one year in our local office learning how every department functioned and interacted. During that one year, we had to pass home study courses on personal and commercial insurance. After successfully completing the one year AND the two courses, you went to Hartford for your 4-6 week intensive education in your specialty (agents went for 8 weeks to learn the business). Then, you were an associate underwriter in your office for a year, under the supervision of a seasoned underwriter. Aetna always encouraged you to get your CPCU, AU, etc., and rewarded those who were successful. Two people at Aetna who really influenced me were Pete Raymond, my Underwriting Manager, and Al Reese, my Branch Manager. I learned a lot about the business and professionalism from them, and, unfortunately, this is what is missing from the industry today.

It is amazing to talk to underwriters in many companies who are Senior Underwriters with 1 to 2 years' experience who barely know how to spell insurance. The only influence they have is cash-flow. Profitability is a bad word, and all they want to know is "What price do you need?" They have no idea of loss picks, loss analysis, underwriting for profit or impact studies. Without education (there have only been roughly 62,000 CPCU designations attained by the tens of millions of employees in the industry since the designation was introduced), this industry is doomed to continue to its mistakes. Poor underwriting, little underwriting profit (you have to underwrite for a profit, not count on your investment income), and huge market swings will continue.

—Jim Kahn, CPCU, ARM, Risk Manager, Lackawanna Insurance Group, Wilkes-Barre, PA

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IRMI Update—Issue #194

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