1. David Lodwick, CIC, CRM Director of Trust Services
Risk Management 101
David Lodwick, CIC, CRM
Director of Trust Services

2. “Risk Management is the practice of protecting an organization from financial harm by identifying, analyzing and controlling risk at the lowest possible cost” - Robert J. Marshburn, CIC, CRM, ARM

3. 3 Short Thoughts Don’t risk a lot for a little
Don’t risk more than you can afford to lose.
Don’t treat insurance as a substitute for risk control*
*CRM Practice Manual

4. Some Basic Steps Identify your risks Property
People: employees, vendors, public
Other
Controlling/Managing those risks
Risk Transfer
Contractual
Insurance
Know your retention levels
Monitor and modify

5. Property Risks 1st Party Buildings Business Personal Property
Property in the Open (Fixtures)
Mobile Equipment
Care, Custody & Control
Short Tail (Claims open and close quickly)

6. People 3rd Party Employees Employment Practices Hiring Termination
“Everything in between”

7. Public Premises Liability – Slip & Fall Law Enforcement exposures
Elected Officials – Ordinances and Land Use Decisions

8. Controlling Risk Property Inspections Maintenance schedules
Reporting and monitoring procedures for corrective measures

9. Controlling Risk Employees Safety training Protective equipment
Hiring practices
Job descriptions – Essential duties
Supervisor training ……

10. Controlling Risk Risk Transfer High Risk Operations Transfer Risk
Avoid
Sub-Contract
Transfer Risk
Contractual Transfer
Indemnification
Hold Harmless
Waiver of Subrogation
Insurance
Last option

11. Build Your Team Internal Legal Your staff Human Resources Accounting
Department heads
Key staff members
Safety committee

12. MUST COMMUNICATE WITH YOUR TEAM!
Build Your Team
External
Insurance carrier staff
Risk Control
Adjusters
Other resources
TPA’s
Agent/Broker
Consultants
MUST COMMUNICATE WITH YOUR TEAM!

13. Summary Identify Your Risks Develop Your Plan to Control
Contractual Transfer
Insurance Transfer
Retain
Deductibles
Self Insurance
Build Your Team and Work Your Plan

14. Workers’ Compensation & Your Experience Modification Factor
Workers’ Compensation Premium –
Payroll x Rate x Mod = Premium
Can Only Control the Mod!

15. Frequency Leads to Severity
Claims Issues
Frequency – How many losses
Severity – Large losses
Frequency Leads to Severity

16. Two Types of Losses
Medical Only – medical treatment for injury/exposure – worker returned to work in less than 7 days
Lost Time - medical treatment for injury/exposure – worker returned to work in more than 7 days

17. What is Counted as “Actual Losses?”
Medical Only Losses
Worker out less than 7 days
$ Losses Discounted by 70% in the formula
Lost Time Losses
Worker out 7 days or more
$ Losses not discounted

18. Medical Only vs. Lost Time Claim

19. Keys to Managing Your Mod
Reduce losses through effective safety program
Effective return to work program to reduce the number of lost time claims
Monitor your claims reserves with TPA/carrier

20. Questions?