Any business owner will know the stress of finding the right insurance policy to protect against major risk events. After all, it’s hard to accurately diagnose the risk environment your company faces and anticipate what could go wrong. The difficulties of reading and understanding the fine print of insurance policies only add to the challenge of optimizing risk exposure to get the most bang for your buck.
The reality is that most insurance policies auto-renew before business owners can take the opportunity to match up their existing coverage with their ever-changing risk exposures. These risk exposures might be anything from a change in company revenue or number of employees to changes in third-party vendors or the regulatory framework for your business.
Even if all of the above is relatively stable, the insurance market regularly sees turnover, with new-to-market companies possibly offering superior coverage or cheaper prices than you are currently paying. The 2018 Small Business Risk Report found that as many as 43% of small business owners had not reviewed their insurance policies and coverage within the past year. That’s plenty of time for new risks to have emerged or for a more competitively priced new insurance company to have entered the scene.
Ordering a risk review is ideal for business owners who worry about whether they have the coverage they require at the best possible price. A risk review is an easy, thorough, and affordable way to ensure that all of your insurance needs are met. All that is required to initiate the process are your commercial property and casualty insurance policies and any summary plan documents for your existing employee medical plan.
What Is a Risk Review?
A risk review is a detailed risk management analysis process. Taking into account all of your insurance needs, it examines your current policies to determine if you have the appropriate coverage or if you face unintentional gaps that will cause substantial exposure to risk.
The principal conclusions of a risk review will present an evaluation of your risk priorities, identify cost-effective ways to implement a suitable risk management program, and highlight any emerging risks that your business may face.
What’s Included in a Risk Review
A risk review consists of a comprehensive dive into the policy documents of a business in order to thoroughly understand the full extent of its coverage and identify any unnecessary risk exposure or coverage gaps. The process involves a few individual analytical categories.
Commercial property and casualty (P&C) analysis identifies the risk environment facing your business and determines whether your current insurance policies provide appropriate coverage. As the name suggests, P&C analysis requires a review of your current commercial property and casualty policies. It then can accurately identify policy change recommendations and possible coverage shortcomings, including:
- Gaps in coverage
- Coverage exclusions
- Additional necessary coverage
- Opportunities to rearrange insurance packages for more comprehensive or lower-cost coverage
- More efficient insurance methods
Alternative opportunity analysis then determines risk management tools that may provide superior coverage and offers ideas that your current agent may not even be aware of. Such options may include alternative P&C coverage, enterprise risk management (ERM) solutions, employee medical coverage, employee benefits, and executive programs.
Guidelines for a Risk Management Process Review
The risk management review process involves a deep dive into the intricacies of each individual policy. It assesses your coverage and points out any important details, including:
- Limitations and exclusions
- Property locations
- Risk classifications
The risk review will also take a look at many of your company’s other operations—individual websites, Facebook pages, Yelp reviews, and any other internet presence—to help paint the most complete picture of your company and the risk environment it faces.
A full recommendation section includes findings for each policy, such as:
- Gaps in coverage, such as for cyber-liability or special events
- Recommendations for property appraisals if findings indicate some holdings are over or undervalued
- Creative recommendations to ensure coverage is maximized for risk exposures
The overall length of the risk review varies depending on the size of the account, the number of policies that must be reviewed, and the density of detail required in order to-do the best possible job. Risk review reports typically take 1 to 3 weeks to complete, and can range in length from as few as 5 pages to as many as 35.
Ordering a risk review can help you learn about alternative methods for managing risk that will prove immediately beneficial to your company. Since no one can accurately anticipate everything that might go wrong in a business, a third-party risk review is a great way to find potential problem areas that you or your agent overlooked.
RMC Group’s dedicated professionals bring deep industry knowledge, extensive experience, and a careful, unbiased perspective to every risk review. With over 45 years of experience, RMC Group professionals are well-equipped to help you get the insurance you need for a variety of domains, including personal insurance, business insurance, life insurance, captive insurance, health stop-loss, and retirement plans.
If you are ready to discover if your business is adequately protected, please get in touch today and request a free risk review. It costs nothing to have RMC specialists review your coverage and suggest money-saving alternatives. To get your complimentary review, just send in your entire commercial policy—including both coverages and exclusions—so that we can help you truly understand what kind of risk you are protected against and exposed to.
While risk can never be fully eliminated, a risk review will give you peace of mind in knowing your business is properly covered in the event of a catastrophic loss.