Mhc 710 Jh 01 Risk Management Structure Of Risk Exposure Management

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  • Mhc 710 Jh 01 Risk Management Structure Of Risk Exposure Management

    1. 1. What Risk Manager Does <ul><li>ID exposure to loss </li></ul><ul><li>Manage potential effects </li></ul>
    2. 2. 9 Key Areas of Exposure <ul><li>Property </li></ul><ul><li>General Liability </li></ul><ul><li>Professional Liability </li></ul><ul><li>Automobile Liability & Physical Damage </li></ul><ul><li>Employee/volunteer injury and illness </li></ul><ul><li>Directors and officers liability </li></ul><ul><li>Fiduciary liability </li></ul><ul><li>Aircraft liability </li></ul><ul><li>Crime </li></ul>
    3. 3. Property <ul><li>What is considered to be property </li></ul><ul><li>Ways to Insure Property </li></ul><ul><ul><li>All Risks </li></ul></ul><ul><ul><li>Named Peril </li></ul></ul><ul><li>Review property & ID risks </li></ul>
    4. 4. Buildings <ul><li>Basis for valuation </li></ul><ul><li>Factors used by insurance company to determine value </li></ul><ul><li>Choose coverage based on replacement cost or depreciated value </li></ul><ul><li>Survey showed that 76% of business owners thought they had purchased replacement cost coverage. Only 9% in fact had such coverage! </li></ul>
    5. 5. Contents <ul><li>Difficult to value & track </li></ul><ul><li>Replacement cost or original cost must be determined </li></ul><ul><li>What is considered to be contents? </li></ul>
    6. 6. Electronic Data Processing Equipment (EDP) <ul><li>High Importance </li></ul><ul><li>What is considered to be EDP? </li></ul><ul><li>Valuation </li></ul><ul><li>EDP Floater </li></ul>
    7. 7. Valuable Papers, Books & Documents <ul><li>Get assessment of replacement cost from loss control company </li></ul><ul><li>Protect documents that will be used in trial or hearing </li></ul><ul><li>Keep duplicates </li></ul>
    8. 8. Unusual Property <ul><li>High tech communications equipment </li></ul><ul><li>Moveable property </li></ul><ul><li>Exhibits </li></ul><ul><li>Examples </li></ul><ul><li>Radiation emission </li></ul><ul><li>Should be insured on an inland marine “floater” </li></ul>
    9. 9. Personal Property of Others <ul><li>Leased equipment </li></ul><ul><li>Patients’, guests’, employees’ & volunteers’ belongings </li></ul><ul><li>Don’t allow highly valuable belongings </li></ul><ul><li>Warn guests and employees to protect </li></ul><ul><li>Employees are fully responsible </li></ul>
    10. 10. Boiler & Other Machinery <ul><li>Pressurized machinery </li></ul><ul><li>Often underinsured </li></ul><ul><li>Not required t/b insured by law </li></ul><ul><li>Proper maintenance & a good back </li></ul><ul><li>“ Joint Loss Agreement” </li></ul><ul><li>Insurance rates are relatively low </li></ul>
    11. 11. Business Income Losses Include Lost: <ul><li>Revenue </li></ul><ul><li>Continuing operation costs </li></ul><ul><li>Extra costs </li></ul><ul><li>Opportunity Costs </li></ul>
    12. 12. Additional Property Exposures <ul><li>Common risks </li></ul><ul><li>“ Builders Risk” insurance </li></ul><ul><li>Other things to insure </li></ul><ul><li>Construction agreement </li></ul><ul><li>Property lease agreements </li></ul>
    13. 13. General Liability <ul><li>Torts </li></ul><ul><li>Jurisdiction Determinants </li></ul><ul><li>5 Categories of Cost Involved With Civil Action </li></ul><ul><li>Criminal actions are generally uninsurable </li></ul>
    14. 14. General Liability Contract <ul><li>Typically inclusions: </li></ul><ul><ul><li>Bodily Injury </li></ul></ul><ul><ul><li>Property Damage </li></ul></ul><ul><ul><li>Legal Liability </li></ul></ul><ul><ul><li>Employee benefits liability </li></ul></ul><ul><ul><li>Patient’s property </li></ul></ul><ul><li>Typical Exclusions: </li></ul><ul><ul><li>Employee benefits </li></ul></ul><ul><ul><li>Completed operations </li></ul></ul><ul><ul><li>Products </li></ul></ul>
    15. 15. Insuring Agreements <ul><li>What insurance company will pay </li></ul><ul><li>Insurer has “right and duty to defend” </li></ul><ul><li>Inclusion </li></ul><ul><li>Exclusions </li></ul><ul><li>Personal and advertising liability </li></ul><ul><li>“ Named insured” </li></ul><ul><li>Conditions section of policy </li></ul>
    16. 16. Professional Liability <ul><li>Coverage is triggered by a “medical incident” </li></ul><ul><li>4 types of liability to include </li></ul><ul><li>Consent” Provision in ins. Contract </li></ul><ul><li>Occurrence vs. claims made policies </li></ul>
    17. 17. Automobile Liability <ul><li>Ordinary auto insurance </li></ul><ul><li>Not off-road vehicles </li></ul>
    18. 18. Employee/Volunteer Injury and Illness <ul><li>2 Parts to Workers Compensation </li></ul><ul><ul><li>Benefits allowed by state law </li></ul></ul><ul><ul><li>Insures employees not included under Part A and employees families </li></ul></ul>
    19. 19. Directors and Officers Liability <ul><li>Personal management decisions </li></ul><ul><li>Only coverage triggered solely by action against an individual </li></ul><ul><li>D & O vs. General Liability coverage </li></ul>
    20. 20. Fiduciary Responsibility <ul><li>Handling $ for employees </li></ul><ul><li>Employee payroll deductions </li></ul>
    21. 21. Aircraft Liability <ul><li>Injury from unloading aircraft </li></ul><ul><li>Helipads </li></ul>
    22. 22. Crime Insurance <ul><li>W/the property contract or separately </li></ul><ul><li>5 common insuring agreements </li></ul>
    23. 23. Affects of Risk Management Process <ul><li>Every aspect of health care organization </li></ul><ul><li>Uninsured or underinsured loss can devastate </li></ul><ul><li>Cost effective improvements in risk management can create accrued benefits </li></ul><ul><li>Decreased losses=increased employee morale </li></ul><ul><li>Properly protected assets=operational efficiencies </li></ul><ul><li>Good safety record=good reputation in community </li></ul><ul><li>Benchmarking </li></ul>

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