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The importance of being learned.

The Importance Of Being Learned

The best way to learn the science of risk management, given the opportunity and the time, is by observing an established risk management professional in conjunction with actual hands-on experience. However, learning by experience has several drawbacks.

First, you can only learn as much as from an established risk manager as he or she already knows. By picking up information from only one source, you may be severely limited in the scope of knowledge which can actually be put into use in practicing risk management. In addition, when learning from an established professional it is possible to acquire his good work habits as well as his bad. Experience and observation aside, the four best methods of enhancing your own education in risk management are through unversity courses, professional designation programs, proprietary offerings and independent study.

University Courses

In evaluating the opportunities to learn risk management through university courses, distinguish between those courses which concentrate solely on risk management and those which focus on insurance. For example, when considering a course entitled, "Risk Management and Insurance," ascertain whether it primarily covers the entire risk management process with insurance being only one relatively minor technique, or if it examines insurance in a general risk management setting. Insurance courses which bear a "risk and insurance" title are fairly common and can be found in scores of universities around the United States.

The number of university courses in insurance and risk management has steadily declined during the last decade, largely because faculty committees of collegiate business schools who make curriculum decisions feel "insurance" classes are too vocational for many of their managerially-oriented students. Therefore, many forward-looking members of societies with similar interests, such as ARIA and RIMS, are emphasizing risk management, rather than simply insurance, as an essential function of all managers.

The following is a brief list of institutions around the United States offering masters and/or doctoral studies in insurance with at least some concentration in risk management.

Golden Gate University

San Francisco, CA

University of Hartford

West Hartford, CT

University of Florida

Gainesville, FL

University of Georgia

Athens, GA

Indiana University

Bloomington, IN

University of Michigan

Ann Arbor, MI

College of Insurance

New York, NY

University of Pennsylvania

Philadelphia, PA

North Texas State University

Denton, TX

Old Dominion University

Norfolk, VA

Risk management is a function and discipline that deserves prominence in the curricula of all business schools. Telephoning or writing the dean of your local business school to ask for the creation of a true course in risk management can only add to the momentum of the crucial effort to maintain risk management as a recognized field of practice and professional study.

Professional Designation Programs

When properly understood and practiced, risk management entails both preventing and financing recovery from accidental losses. There are several professions related to both safety and finance that contribute significantly to risk management, either generally or to a specific aspect of this discipline. With respect to risk management as a general function, two prominent professional designation programs are the Associate in Risk Management (ARM) Program, sponsored by the Insurance Institute of America, and the Chartered Casualty Underwriter (CPCU) Program, sponsored by The American Institute.

While neither of these specialized designations encompass all aspects of risk management, or even loss control, they do offer the latest highly detailed technical information on preventing a wide variety of losses. In addition to these designations, there are numerous trade associations which offer study programs, with many leading to industry specific designations that deal with recognizing and managing hazards that characterize specific segments of the economy.

Should you be interested in acquiring special expertise in risk financing, such as arranging financial programs to pay for an organization's accidental losses, the options are to enroll in Certified Insurance Counselor (CIC) Program, sponsored by the Society of Certified Insurance Counselors, or the Certified Employee Benefit Specialist (CEBS) Program, sponsored by the International Foundation of Employee Benefit Specialists, or the Chartered Financial Analyst (CFA) Program, sponsored by the Institute of Chartered Financial Analysts. Like the specialized designations in risk control, these financial designations are likely to deal with only certain facets of risk financing or with risk financing as part of a more general financial function. Thus, their focus is often either narrower or broader than the entire risk financing function.

Proprietary Offerings

A proprietary offering is typically a seminar or other short program no more than a week in length through which the sponsor intends to generate revenue substantially greater than the cost of running the program. Proprietary offerings usually focus on especially current or newsworthy aspects of risk control or risk financing such as pollution control, discriminatory hiring practices or recent changes in tax laws or other regulations.

A proprietary educational offering is like any other product or service an organization can purchase. Many of these programs are usually worthwhile, but as with any other product or service, some programs are better than others. The value of each program is dependant on each organization's and each risk management professional's particular needs.

When evaluating the cost and benefit of a particular proprietary program, consider the following questions: How important is the information the seminar promises to provide? Can this information be obtained more cost effectively elsewhere? Have any of my organization's other employees attended this program and effectively pass on to me the knowledge they gained there? Is it possible to obtain the prepared written materials from this program without attending? What is the professional reputation of the sponsor organization? What is the professional reputation of the scheduled speakers? Can attending the program be combined with other business to reduce the cost, or increase the benefit of participating? Evaluating proprietary offerings can often be a difficult task. The proprietor is entitled to make a profit and the customer has the right to education "services" whose value is greater than their cost.

Independent Study

Risk management professionals are largely responsible for their own continuing education, and should read a wide variety of publications with an eye toward their risk management applications. Aside from publications relating to their specific industries, risk managers must develop their own libraries of those books and periodicals that are most applicable to their work.

A comprehensive list of many of the most widely used property/liability insurance and risk management texts is available without charge from the Insurance Information Institute, 110 William Street, New York, NY 10038. Aside from books dealing strictly with insurance, essential risk management books can be grouped into three categories: (1) general risk management, (2) risk control and (3) risk financing. Grouped as such, some of the more useful books for a risk managers permanent library are:

General Risk Management

Handbook of Risk Management

by Robert L. Carter and Neil A. Doherty

Kluwer Publishing, Ltd.

One Harlequin Avenue

Brentford, Middlesex, TW 8 9EW

England

Introduction to Risk Management

by Neil Crockford

Woodhead-Faulkne, Ltd.

8 Market Passage

Cambridge, CB2 3PF

England

Governmental Risk Management Manual

Risk Management Publishing Company

2030 East Broadway

Tuscon, AR 85719

Essential of the Risk Management Process

(2 vols.)

by George Head and Stephen Horn

Insurance Institute of America

720 Providence Road

Malverne, PA 19355

Risk Control Techniques

Occupational Safety and Health Management

by Thomas Anton

McGraw-Hill Book Company

1221 Avenue of the Americas

New York, NY 10020

Principles of Fire Protection

by Percy Bugbee

National Fire Protection Association

Batterymarch Park

Quincy, MA 02269

Modern Safety and Health Technology

by Russell DeReamer

Wiley-Interscience

John Wiley & Sons

605 Third Avenue

New York, NY 10016

Products Liability--A Management

Response

American Management Association

135 West 50th Street

New York, NY 10010

Risk Financing

The Business Insurance Handbook

Dow Jones-Irwin

1818 Ridge Road

Homewood, IL 60430

Workers' Compensation--Desk Edition

(2 vols.)

by Arthur Larson

Matthew Bender & Company, Inc.

235 East 45th Street

New York, NY 10017

The Self-Insurance Manual

by Claude Lilly and H. Glenn Boggs

NILS Publishing Company

21625 Prairie Street

Chatsworth, CA 91311

Handbook of Commercial Property and

Casualty Insurance

Insurors Press

P.O. Box 955

Santa Monica, CA 90406

An experienced and educated risk manager must constantly be aware of existing and potential hazards and perils and be able to minimize or avoid these situations by formulating appropriate safety measures or utilizing available risk financing devices. Therefore, virtually everything a risk management professional reads or hears is likely to have some risk management applications. A risk manager's education should not be confined to a particular course, seminar or publication; rather it should be a cumulative result of his daily routine and experience.

George L. Head is professor of insurance and risk management at Temple University.
COPYRIGHT 1989 Risk Management Society Publishing, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1989 Gale, Cengage Learning. All rights reserved.

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Title Annotation:learning the science of risk management
Author:Head, George L.
Publication:Risk Management
Article Type:Bibliography
Date:Sep 1, 1989
Words:1436
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