Risk Management Flashcards
DAS Risk Management components
Insurance Services
Claim/Lawsuit Management
Risk Consulting Services
DAS Risk Management- Insurance Services
- Exclusive Statutory authority
- Administer Self Insurance Program
- Purchase Commercial Insurance/ Broker Services
DAS Risk Management- Claims/Lawsuit Management
- Sole authority to pay Employment, Property & Liability claims
- SAIF Corporation Workers’ manages Compensation costs
DAS Risk Management- Risk Consulting Services
- Best Practices promotions
- Risk profiles and consultations
-DAS’ “go to” risk resource - No service fees billed for our time
What is Risk Appetite?
The Amount of risk exposure the agency is willing to financially accept of retain
3 levels: Risk Avoidance, Active Retention, Passive Retention
Risk Appetite: Risk Avoidance
Not engaging in an activity
Risk Appetite: Active Retention
Risk identification and assessment has been performed allowing agency to plan for the exposure
Risk Appetite: Passive Retention
” I didn’t know”
Agency is still financially responsible for the results associated with the activity
What are 5 Steps in Risk Management Process?
Identify
Access
Control
Finance
Administration
Contract Risk Transfer: 5 Methods
Select transfer and indemnification language
Know your insurance options
Conduct a risk assessment
Determine insurance requirements
Review Certificated of Insurance
What is purpose of Contract Risk Transfer?
Transfers financial risk of claims and lawsuits to other parties by using language within the contract or agreement
Your risk-> Contract Language = Contractor’s Risk
What are two methods of Transferring Risk?
Non-insurance and Insurance
What are examples of Non-Insurance Transferring Risk method?
- Hold harmless agreements
- Additional insured endorsement
- Waiver of subrogation
-Financial retention
What are examples of Insurance Transferring Risk method?
-Carrier provides coverage for a potential risk to the insured
-Carrier is paid a premium for insurance agreement
What is the Indemnity Clause?
An indemnification clause is a legally binding agreement between two parties specifying that one party (the indemnifying party) will compensate the other party (the indemnified party) for any losses or damages that may arise from a particular event or circumstance.
Agreement written into the contract
Reimburses the state of any claim due to the contract
Ensures the contractor retains the liability
Transferring risk created by vendors from state to the contractor happens:
A: By using DOJ approved contract template which have an Indemnity section and Insurance requirements
B: By avoiding doing business with certain contractors
C: By requesting the contractor to have insurance
D: By reviewing all the contractor’s work to ensure the cause no accidents
A: By using DOJ approved contract template which have an Indemnity section and Insurance requirements
Risk created by contractors are managed during the procurement process mainly by:
A: Asking the contractor to avoid causing accidents and/or claims
B: Transferring the risks to the contractor and ensuring they have appropriate insurance
C: Constantly supervising the contractor to make sure they do not harm anyone or anything
D: Requesting as much insurance as possible
B: Transferring the risks to the contractor and ensuring they have appropriate insurance insurance
Why is important to assess Risks in contracts?
- Ensures the contractor meets obligation under Indemnity (Risk transfer)
- Be able to explain exposures
3.Document why (reasonableness) - Best business practice
What is OCCURENCE in Coverage Limit Definitions?
Amount the insurer will pay for claims resulting from a single event
What is AGGREGATE in Coverage Limit Definitions:
The most the insurer will pay for all covered losses sustained during the specified policy period
What is COMBINED SINGLE LIMIT in Coverage Limit Definitions:
A single dollar limit that applies to any combination of bodily injury and property damage
What are risk transfer practices in Intergovernmental (IGA) and Interagency Agreements?
Between public entities ( Non-profits are NOT considered public entities)
Use Contributory contract language
Document Insurance for any subcontractors
Liability is based on the Oregon Tort Claims Act
What is CGL?
Commercial General Liability (Insurance)
True or False: Contract Amount DOES NOT drive the insurance amount
TRUE
How do you determine CGL limits?
Use Risk Assesment Tools
True or False: CGL does not require additional Insured Status (endorsement)
FALSE
General Liability Insurance (CGL) Require ADDITIONAL INSURED status (endorsement)
What is PL?
Professional Liability
What is PL insurance?
Insurance required of any person/ company providing professional advice or services.
True or False: Professional Liability (PL) require tail coverage for a reasonable period after work competition ( approximately 24 months)
TRUE
Professional Liability (PL) require tail coverage for a reasonable period after work competition ( approximately 24 months)
What is Technology E&O?
Technology Errors & Omissions
What type of insurance do IT Service contracts need?
Commercial General Liability AND Professional Liability
Examples of Best practices when preventing risk: what TO DO
Conduct a risk assessment for every agreement or contract
Require the appropriate insurance types and limits
Include Indemnity/ Hold Harmless clause in your agreements or contracts
COI should reflect the insurance type and limits requested in your contract
Request the “additional insured” endorsement on CGL, Auto and Umbrella/Excess policies
True or False: Indemnity/ Hold Harmless clauses are a non-insurance transferring risk methods
TRUE
True or False: Risk transfer does not need to be considered for Intergovernmental Agreements
FALSE
What are the two insurances that are necessary for all contracts:
A. CGL and Auto
B. Professional and Pollution\
C. Crime Protection Coverage and Auto
D. Bailee’s coverage and CGL
A. CGL and Auto
OCCURRENCE
the amount the insurer would pay for all claims associated with a single event
AGGREGATE
the amount the insurance carrier would pay for all covered losses that occur during a policy period
the amount the insurer would pay for all claims associated with a single event
OCCURENCE
What is CIO?
Certificate of Insurance
What is Certificate of Insurance? (definition)
Document evidencing the fact that an insurance policy has been written and includes a statement of the coverage of the policy in general terms
The purpose of the Certificate of Insurance is to:
A. Have extra paper for my file
B. Verify the contractor is meeting our insurance requirements
C. So I can show my manager what a great job I did
D. To make sure the risk has been transferred because the contractor has insurance
B. Verify the contractor is meeting our insurance requirements
True or False: By being listed as a certificate holder on the Certificate of Insurance confirm we have been given Additional Insured Status on the contractor’s insurance policy
FALSE
True or False: It is OK to wait until after the contractor begins providing services under the contract to request and obtain the certificate of insurance
FALSE
True of False: Insurance policies never change or expire therefore once I have a certificate of insurance from the contractor Inver need to ask for one again
FALSE
