3 Questions Featured

8:00pm EDT August 26, 2010

Regina Spratt leads the national brokerage segment for Marsh Inc. in the United States. She is responsible for the strategic direction and overall growth of business focused on midsized buyers. She has previously run the national brokerage operation in the New York metro area and has held numerous leadership positions throughout the Northeast.

Q. How can a business save money on its risk management?

What industry you’re in and who you’re getting advice from can play into that. At the end of the day, a big part of what people pay are their straight-up insurance premiums. We talk with our clients about a concept called the total cost of risk, and insurance premiums are just one part of that total risk. There are costs associated with those claims — and if you have any kind of insurance program where you retain any loss or have any deductible, that’s money that you pay out. So the ability of companies to do a better job from a production standpoint can help them control their own costs and can ultimately help them get more favorable rates on the insurance side. We try to spend as much time with our clients in regard to their insurance premiums and program design, but we also spend time on the things they can control.

Q. How will risk management help the bottom line?

The first and obvious way is cost — the cost associated with their insurance program or their retained losses. Another impactful way is that there’s a steep compliance or regulatory burden across many industries, and risk management is clearly something that can help manage that financial or administrative burden. It can also either help or hurt a company’s ability to grow, and there are industries where it does allow companies to be more competitive.

Q. What has changed during the last year or two in the industry?

The external environments and the risks that people face will never decrease. The last 12 or 15 months have been a time when people have had to balance how they best manage risk, and in the cases where they’re using insurance, are there ways they can be creative in how they structure the program to minimize costs?