NU Online News Service, July 16, 12: 26 p.m. EDT
Insurance program and policy coverage consistency is the key reason risk managers implement and maintain global insurance programs, according to a recent survey from Jardine Lloyd Thompson.
The survey was taken during a global insurance management workshop run by Jardine Lloyd Thompson Ltd., a subsidiary of London-based insurance broker JLT at the Association of Insurance & Risk Managers annual conference this week in Great Britain. According to the association's Web site, it has over 800 members representing over 450 companies in the United Kingdom and internationally.
Sixty-seven percent of those surveyed cited compliance and policy coverage as key buying priorities, with 64 percent stating that control and consistency of their insurance programs were key drivers for implementing and maintaining global insurance programs.
Karen Gorman, partner at JLT, said in a statement, "Achieving these ambitions demands a clear understanding of the insurance regulatory requirements in the different territories and of the policy extensions and nuances that help achieve a compliant program and ensure that claims can be paid, that directors do not fall foul of local laws and that companies do not get nasty surprises from the failure of their local and global programs to dovetail.
"It was therefore surprising that corporate governance requirements have not demanded that more companies commission independent reviews of their global insurance placements. Sixty percent had never commissioned such a review and only 30 percent had done so in the past three years," she said.
"A global insurance review considers the effectiveness of the program and whether a traditional, hub or centralized model would be more efficient; and if the insurance arranged is done in as compliant a way as is possible," she concluded.
Tracey Clayton, associate in Global Service Team, JLT, said, "Companies commission many different types of independent reviews from their accounts through to pension and other assets and liabilities. Whilst issues with global insurance placements could cost many millions in preventable uninsured losses, companies have clearly not realized the many potential benefits of a full independent global insurance review."
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