Outsourced Risk Management Division
Alpha takes a multi-pronged approach to painting a complete picture of your organization and operations.
We would begin by interviewing your top management and proceed down the line to the next level of management.
If you are a corporation we would look at your Board of Directors minutes to broaden our perspective. We would also study your Policy, Procedure and Employee Manuals to firm up our approach as risk managers. Brochures describing your products and/or services would also be studied for language which might be used against you in future litigation.
Alpha Risk – We also provide you with benchmarking data for other firms in your industry.
Having defined your known risks and theorized some unknowns, the next step would be to thoroughly analyze your current insurance programs.
We would first want to establish whether you enjoy the full broadness of protective clauses available. As part of your program under scrutiny would be the suitability of retentions you have opted for from a risk/reward point of view as well as the adequacy of limits and sublimits purchased.
Deficiencies would be noted, perhaps in the area of specialized policies such as Cyber and Social Media protections.
Our report would include our assurance (or not) as to insurer financial strength, licensing and ratings, perhaps against lender requirements.
In serving in this capacity Alpha first identifies and quantifies the risks to which your company is exposed – and this can be dynamic situation which evolves over time, i.e. Cyber Security issues, environmental compliance and zoning changes; or your entry in a new aspect of products projects and/or services.
We analyze the methods you have chosen to address those risks such as: building hardening; fire loss prevention; contract draft review prior to execution; cyber protection; risk retention; and finally, insurance protection.
We respect your insurance broker’s role in selling you various policies and then placing coverage in the insurance marketplace.
Your Expert Advisor and Advocate
During the due diligence process we start with a risk management review of the subject property or development plan.
As your expert advisor and advocate, Alpha assists in providing you with options and, once your choices have been made, working to direct your broker as a working partner to complete the placements.
This process, which periodically involves a broker competition, consists of the following steps:
- Assembling exposure data, including insurable values, personnel and payroll data as well as revenues.
- Historical loss experience, including adjusters’ notes on significant claims.
- Detailed coverage specs which we create by line of coverage.
When a broker competition is involved we require the participants to prioritize the insurers they propose to contact, by line of coverage, and whether they have the capability to approach these markets directly or through an intermediary.
We present you with a chart showing proposed market assignments and, following your approval, we control the marketing effort every step along the way, also to ensure there is no insurance group overlap.
The first criterion for selection is always broad coverage language as this aspect is critical insofar as providing comprehensive coverage at time of loss.
Following a favorable review by us we can then look at all costs including premiums, retentions and broker compensation.
Approaches to Risk – Transfer, Retention, Reduction
Contractual – well prior to the signing stage we review your drafts (although we are not lawyers) and suggest wording so that counterparties will indemnify and hold you harmless as well as provide evidence of insurance. Their policies should name you as an additional insured where appropriate so that their insurers will provide a defense and pay claims against you which are covered under the agreement.
Purchasing insurance on a first dollar basis (or close to it) is usually an uneconomic choice. After reviewing your historical loss experience (against the backdrop of remedial steps you may have taken) and assessing your appetite for risk, we will arrange for policies to be quoted at various retention levels. As a corollary to that decision – we often recommend using some or all of the resultant premium savings to suggest purchasing higher limits to provide further protection against catastrophic events.
From a property protection point of view we have worked with clients who have hardened windows exposed to severe windstorms as well as moving HVAC installations to higher floors following flood mapping studies. We also encourage inspections, where appropriate, to provide detailed recommendations designed to improve fire protection/prevention.
As to third party claims there are numerous steps an owner can undertake at minimal cost to prevent slip and fall events both within a building as well as outside.
We typically play a key role in transactions by securing the best protection associated with acquisitions/divestitures, issuance of securities, financing and construction.
How We Can Do It
We have a history of working cooperatively with your broker to achieve goals on your behalf.
Periodically (but certainly not annually) we usually recommend a broker RFP to reassure ourselves (you and we) that you are receiving the absolute best the market has to offer.
This effort may involve re-structuring one or more of your lines of coverage to optimize the placement, based upon then current market conditions i.e., excess capacity or new lines of business.
Depending upon your industry and the then current status of the insurance marketplace (insurers, reinsurers, capacity, pricing) we would design and directly oversee a broker competition allocating markets to each. Perhaps in the alternative, a single broker selection process if, together we reached the conclusion that there would only be a limited number of insurers who could participate in our program.
Real Estate – development, management, purchase/sale agreements.
Occupancies (many recognizable names)
- Office – iconic towers; suburban high-rise luxury
- Residential – hi-rise luxury; garden apartments
- Retail – 450 million square feet
- Hospitality – iconic plus hotel chains
- Municipal, including airports and docks
Real Estate Lending – over $100 billion loan value
- Commercial banks
- Private equity
- Family offices
Universities – Big Ten, others
Hospitals; medical providers
Construction – ground up, interior build-outs
Pension plans – one with assets of $90 billion.
Not-for-profit (mostly as pro-bono)
Quasi- Gov’t entities
- Mail order/catalog
We provide an in-depth analysis of binders followed by the policies themselves for compliance with the protective clauses on your behalf.
During the course of the year Alpha continues to act as your outsourced risk manager:
- Assistance at time of loss, be it our property or a 3rd party claim.
- Contract language review prior to execution.
- Risk management steps such as physical or contractual loss prevention steps.
- Periodic meetings formalized with an advance agenda.
- Availability to respond to your questions.