Efficient risk management helps cut premimiums

Minimising risk should be
top priority in the freight
industry – avoiding claims
that ultimately lead to a spike
in insurance premiums.
“Insurance should be
the transfer of the risks
that cannot be managed
efficiently or cost-effectively,”
Mike Brews, director of
Horizon Underwriting
Managers, told FTW.
But, he said, the problem
was that many clients were
simply not bothered or were
uninformed about the risks
that their cargoes faced and
therefore failed to implement
effective interventions.
“Sometimes this results
in an inevitable loss which
is then uninsurable,” said
Brews. “The insurance
market is currently highly
competitive and many
insurers are just happy to
take on these poor risks just
to get the
business.
“When
the claims
start coming
through, and
premiums
start
increasing,
then the client
slowly starts
to realise that
it is more costeffective
to
implement the relevant risk
control measures.”
And these are as basic
as correct packaging and
stowage, as examples.
For Brews the solution
lies in education. “Brokers
and clients need to
understand the risks they
face and
the costs
involved.
This
information
then needs
to be fed
through the
organisation
so that
everyone
knows
what is
involved and
required,” he said.
“Managing the risk and
then transferring what you
can’t to an insurer shows us
that you are serious about
your business and know
what you are doing.”
Using a reputable
company – where much of
the risk management has
been tried and tested over
years – is also key.
“There are always
new risk management
companies coming
into the market
with ideas to
revolutionise the
industry. Many
of them are fads
and don’t last
long or don’t have
the effect they
were hoping for.
Make sure you use a
reputable company,”
he said.
INSERT & CAPTION
Many insurers are
just happy to take on
these poor risks just
to get the business.
– Mike Brews