NU Online News Service, July 8, 3:52 p.m. EDT
A new report from the Risk and Insurance Management Society (RIMS) said the average total cost of risk per $1,000 of revenue in 2009 fell more than 3 percent due to lower insurance costs and lower risk management administrative costs.
The "2010 RIMS Benchmark Survey"–which is three separate surveys combined into one book–found a drop in insurance premiums was the largest contributor to lower total cost of risk (TCOR) last year.
TCOR represents the total cost of insurance premiums plus retained losses, in addition to internal/external risk control costs. The measure is used to identify risk management strategies.
Premiums and administrative expenses were likely influenced by current economic conditions, said Dave Bradford, executive vice president of Advisen and editor-in-chief of the survey.
"During the economically uncertain times in which we live, risk managers are under constant pressure to review and improve performance, while doing more with less," said Robert Cartwright, member of RIMS board of directors.
Based on three new surveys the survey book states:
o Effective return to work programs go hand-in-hand with lower workers' compensation experience modification factors.
o Risk managers have assumed more responsibility, but few are involved in leadership roles in enterprise or supply chain risk management.
o Price is the leading factor when selecting an insurer.
The RIMS Benchmark Survey book, celebrating its 30th anniversary, is available for purchase for $750. RIMS members and survey data contributors are eligible for discounts.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.