1

What Risk Manager Does

ID exposure to loss

Manage potential effects

2

9 Key Areas of Exposure

1. Property2. General Liability3. Professional

Liability4. Automobile

Liability & Physical Damage

5. Employee/volunteer injury and illness

6. Directors and officers liability

7. Fiduciary liability8. Aircraft liability9. Crime

3

Property

What is considered to be property Ways to Insure Property

All Risks Named Peril

Review property & ID risks

4

Buildings

Basis for valuation Factors used by insurance company to

determine value Choose coverage based on replacement

cost or depreciated value Survey showed that 76% of business

owners thought they had purchased replacement cost coverage. Only 9% in fact had such coverage!

5

Contents

Difficult to value & track Replacement cost or original cost

must be determined What is considered to be contents?

6

Electronic Data Processing Equipment (EDP)

High Importance What is considered to be EDP? Valuation EDP Floater

7

Valuable Papers, Books & Documents

Get assessment of replacement cost from loss control company

Protect documents that will be used in trial or hearing

Keep duplicates

8

Unusual Property

High tech communications equipment

Moveable property Exhibits

Examples Radiation emission Should be insured

on an inland marine “floater”

9

Personal Property of Others

Leased equipment Patients’, guests’, employees’ &

volunteers’ belongings Don’t allow highly valuable

belongings Warn guests and employees to

protect Employees are fully responsible

10

Boiler & Other Machinery

Pressurized machinery Often underinsured Not required t/b insured by law Proper maintenance & a good back “Joint Loss Agreement” Insurance rates are relatively low

11

Business Income Losses Include Lost:

Revenue Continuing operation costs Extra costs Opportunity Costs

12

Additional Property Exposures

Common risks “Builders Risk” insurance Other things to insure Construction agreement Property lease agreements

13

General Liability

Torts Jurisdiction Determinants 5 Categories of Cost Involved With Civil

Action Criminal actions are generally

uninsurable

14

General Liability Contract

Typically inclusions: Bodily Injury Property Damage Legal Liability Employee benefits

liability Patient’s property

Typical Exclusions: Employee benefits Completed

operations Products

15

Insuring Agreements

What insurance company will pay Insurer has “right and duty to defend” Inclusion Exclusions Personal and advertising liability “Named insured” Conditions section of policy

16

Professional Liability

Coverage is triggered by a “medical incident”

4 types of liability to include Consent” Provision in ins.

Contract Occurrence vs. claims made

policies

17

Automobile Liability

Ordinary auto insurance Not off-road vehicles

18

Employee/Volunteer Injury and Illness

2 Parts to Workers Compensation

A. Benefits allowed by state law

B. Insures employees not included under Part A and employees families

19

Directors and Officers Liability

Personal management decisions

Only coverage triggered solely by action against an individual

D & O vs. General Liability coverage

20

Fiduciary Responsibility

Handling $ for employees Employee payroll deductions

21

Aircraft Liability

Injury from unloading aircraft Helipads

22

Crime Insurance

W/the property contract or separately

5 common insuring agreements

23

Affects of Risk Management Process

Every aspect of health care organization Uninsured or underinsured loss can

devastate Cost effective improvements in risk

management can create accrued benefits Decreased losses=increased employee

morale Properly protected assets=operational

efficiencies Good safety record=good reputation in

community Benchmarking