Job Market Heating Up For Risk Managers

MBA Can Open Doors For Risk Managers

Risk managers, as prototypical knowledge workers, need to keep upgrading their education and skills to prosper in an increasingly competitive job market, the professions top placement specialist contends.

The job is getting a lot more complicated, with many risk managers having to cope with Sarbanes-Oxley compliance demands and new broker disclosure requirements.

“That means risk managers need to get up to speed and make sure their skill sets are state of the art,” said Bill Perry, president of Logic Associates, the veteran risk management placement expert headquartered in New York.

Logics “2004 Risk Management Compensation Survey,” co-sponsored by National Underwriter, found that among the risk managers surveyed, very few have law degrees, despite the fact that insurance policies are contracts and claims often involve litigation.

However, Mr. Perry said this is not a surprise, given the evolution of the profession into high finance.

“Many years ago, risk managers were usually insurance buyers and claims processors, so it was more of a lawyers function. Some reported to the general counsel at their firms rather than the CFO,” he recalled.

“But with the growth of the profession over the years, now its clearly a treasury and finance position,” he added. “Youd rather have a risk manager with an MBA in finance than one with a law degree. You hire lawyers to handle litigationyou dont need a lawyer as your risk manager.”

However, the survey found that while virtually all risk managers have at least a BA degree, not all have earned an MBA. In fact, even at the largest firms, no more than two-thirds possess an advanced degree, while only 30 percent of risk managers at the smallest-size firm category have an MBA.

The number of those with an Associate in Risk Management (ARM) designation is also far from an overwhelming majority. Only two of the eight categories surveyed show over half of the respondents with ARMs.

“Theres definitely room for risk managers to grow here,” said Mr. Perry. “The better educated you are, the better chance you have of moving up the ladder to bigger firms that pay higher compensation.”

Flag: Back To School

Head: RMs Still Have A Lot To Learn

In no company-size category do more than two-thirds of risk managers have MBAs, and at smaller firms the percentage is a lot lower. Even fewer have ARM designations.

Flag: FYI

Complete Copies

Of RM Compensation

Survey Report Available

Copies of the complete results from the “2004 Risk Management Compensation Survey,” including a far more detailed breakdown of salary and bonus averages by specific industry and stateeach segmented by company sizemay be ordered for $95 from Logic Associates Inc. at 67 Wall Street, 22nd Floor, New York, N.Y. 10005.

Orders also may be placed by calling 212-227-8000, or by e-mailing Logic Associates President Bill Perry at bperry@logicassociates.com.

In addition, you may visit with Mr. Perry in Philadelphia during this weeks Risk and Insurance Management Society conference, at Booth 1124.

Reproduced from National Underwriter Edition, April 15, 2005. Copyright 2005 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.