Report: Risk Management and Insurance Consolidation at AB Ltd

This report examines the challenges AB Ltd faces in consolidating risk management and the purchase of insurance. It identifies key issues such as lack of customer awareness regarding insurance practices, lack of transparency in operations, and the growing threat of cybercrime and cybersecurity breaches. The analysis delves into the responsibilities of the risk manager in addressing these challenges, including strategies to improve customer awareness, enhance transparency through clear communication and contracts, and implement robust cybersecurity measures to protect sensitive data. Recommendations are provided to optimize the risk manager's role, fostering growth and development within the organization by mitigating risks and building stronger customer relationships. The report emphasizes the importance of proactive risk management to ensure AB Ltd's continued success in the insurance market.

RISK MANAGEMENT IN
INSURANCE -
CONSOLIDATION OF RISK
MANAGEMENT AND
PURCHASE OF
INSURANCE

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
TASKS.............................................................................................................................................1
Challenges in consolidating risk management and the purchase of insurance.......................1
Analysis..................................................................................................................................3
Recommendation....................................................................................................................5
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
It is important for an organisation to manage occurring risks and ensure proper growth
and development. Risk management in insurance refers to quantification and assessment of the
likelihood and financial impact of events which might occur in the world of customer and is
going to require settlement by the insurer (Bikker, 2016). The chosen organisation for this report
is AB Ltd. It is a business management consultant headquartered in Slough, England. The below
report identifies the important challenges of consolidating risk management and the purchase of
insurance. It also analyses these challenges to deliver the responsibilities of the risk manager.
Along with it, important recommendations are provided as per the done analysis to optimize the
benefits of role as risk manager.
MAIN BODY
TASKS
Challenges in consolidating risk management and the purchase of insurance
Purchase of insurance and consolidating risk management revolves around a lot of
challenges which hampers the growth and development of AB Ltd. Below mentioned are
important challenges faced by AB Ltd. during its consolidation of Risk management and
purchase of insurance: Lack of Awareness: AB Ltd tends to face a lot of difficulties when its customer do not
have right awareness about the insurance and related practices. The management of the
organisation has to train its employees in order to ensure that they provide appropriate
awareness to the customers while their purchasing of insurance. The organisation faces
difficulties in managing successful operations when its customers do not have the right
awareness about the services which they are making use of. The challenges faced in
consolidation includes understanding the risks appearing in different environments. These
challenges needs to be addressed by the organisation as per the customer awareness about
the insurance what they seek from the insurance companies. Lack of knowledge about the
insurance create difficulties for organisation to create effective risk management practices
for the customer which it is serving. For example, customers when buy insurance from
the AB Ltd., the employees of organisation has to create a right awareness while
explaining about the insurance policies and ensuring that customers do not claim that
things were not explained to them while the purchase of the insurance (Mühlnickel and
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Weiß, 2015). It is important for the organisation to have such risk management
techniques that when people who are not having appropriate awareness tend to gain new
market growth from the help of these insurance companies. It helps the organisation to
grow and achieve new set of growth and transform itself in order to achieve new growth
and developments. To ensure a better risk management, it is important that the
organisation develops itself in such manner that it is achieving required growth and
development and the appearing risks are handled carefully. For an insurance company,
this is one of the major risk when its customers do not have any sort of awareness. In
order to ensure that the appeared risks are not making the organisation suffer with
maintaining better relationship with its clients, it is important that the management of
organisation identifies the risks before and develops right strategies accordingly. Creation
of better awareness can allow the organisation to maintain its customers for a longer
period. The customers can feel safe while buying and making use of the policies of the
organisation. A good awareness is going to allow the organisation to be more effective in
provision of better services and its customers to be more clear of their particular needs
from the organisation. Lack of Transparency: Lack of transparency is another issue which AB Ltd faces while
consolidating risk management and purchase of insurance. Not having proper
transparency between the organisation and its customers tend to bring risk such as
unclear communication, bad word of mouth and hinders the growth of organisation.
While entering in online market, it is important for the organisation to be clear about the
sold products and services to its customers. Better clarity can help the organisation
achieve required growth and success. Firstly, the organisation has to gain and develop a
required transparency within its framework. Its customers need to be provided with clear
instructions in what manner the organisation is going to sell its insurances are what are
the risks they have to overcome while being a part of it. Not having appropriate
transparency makes it difficult for the organisation to thrive and manage itself
accordingly. Lack of transparency creates risks such as doubts, trust issues between the
company and the customer and makes it hard for the company to ensure an effective
management. In order to ensure that customers are provided with utmost clarity and depth
about the issues of AB Ltd., it is important that the organisation while entering into the
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online market makes use of effective strategies where transparency between the
organisation and its customers is ensured. This can help the organisation to achieve new
set growth and develop its products and services as per the set needs and requirements of
its customers (Lin and Li, 2017). Being more transparent to the consumers can allow the
organisation to achieve set growth and development. Also, it helps its customers to be
more loyal and feel trustworthy towards the organisation. It is important that the
organisation tends to maintain transparency with its clients. It should be the first and
foremost need of the organisation. Having better transparency with its customers can
allow the organisation to reach its set goals and objectives effectively.
 Cybercrime/Cybersecurity: It is important for an organisation while planning its online
capability, to distribute its products to a wider base to ensure that cybercrime and
cybersecurity is not taking place. Cybercrime tends to create situations where the
organisation faces risks of data theft and makes it difficult for the company to ensure
effective insurance practices. Today, cybercrime has increased to a vast level because
people across the world are making use of services on the internet. From the rapid
increase in technology and growth in internet users, it has become easy for criminals to
steal the data and make use of it for wrong purposes. This risk can make AB Ltd. suffer
in terms of providing its people with the right information to maintain a good insurance
practice. It is important for an organisation to manage its products and service on the
online platform easily and create specific allocations to its clients with a user ID and
password. This can protect the clients of company from ensuring that their data is safe
and secure (Altuntas and Rauch, 2017). Cybersecurity is a rising concern for the
insurances companies across the world and this is one of the major risks for the
companies as well where their own and personal data can be robbed and made wrong use
of. The AB Ltd. faces risks such as lack of growth and lack of management which creates
difficulties for the organisation to operate as per its required intensity. It is important for
AB Ltd. Safe practices can allow the organisation to achieve better results, because it
helps the organisation to reach and develop new standards and make its customers feel
loyal towards it.
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Analysis
The responsibilities of risk manager includes to manage the surrounding issues and take
effective care of the situations surrounding the business and customers. It is important for the
Risk manager of AB Ltd. To ensure better management and allow the organisation to grow
without being impacted by the risks. Below explored how the risk manager of the organisation
tends to coordinate with AB Ltd. to ensure better service provision: Lack of Awareness: In order to solve the issue of lack of awareness within businesses
consumers and maintain the organisational reputation, it is important that the business
manager takes necessary steps to do that. To effectively deal with the risk of lack of
awareness and the worry of client problems. The risk manager can identify at what places
the client are facing troubles and what is making the organisation is facing difficulties in
retaining its clients. It is important for the employees who are working for or in the
organisation to have such set of skills and knowledge in which they are able to tell their
clients about the issues of insurance and in what manner their insurance services can be
advanced to achieve better results. These issues can help the organisation to build new
trust with its customers and sort the risk of lack of awareness faced by the organisation.
This action taken by risk manager can help the organisation in clear the path to ensure
and achieve set growth and development. To ensure better awareness, the organisation
can create platforms, where new customer can come and understand the importance of
the services provided by the organisation. This importance can be told to the customer
with various means and methods to achieve required growth and developments. Lack of Transparency: It is important for AB Ltd. to have proper transparency in order
to provide its customers with options to have access to the kind of information they need.
In order to bring a better transparency, it is important that Risk Manager makes use of
effective strategies to reach new development to increase the transparency within its
customer base. (Chang and Elyasiani, 2015). In order to do this, strategies such as setting
out clear terms while making a contract with the client and the seller of insurance
company increase transparency between both of the parties. It can help the organisation
to maintain a strong organisational advantage and make its customers clear about the
fundamentals on which the organisation is built. The other strategies to increase
transparency includes ensuring effective management practices and setting out new goals
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and objectives. For example, when AB Ltd. Is having clear goals it can help the
company's management to make clear decision on their particular wants and needs and to
serve their customers well. While entering on online platforms, it is important for AB
Ltd. to be clear and concise of its own particular goals and objectives. This will define the
company's set needs and is going to help the organisation to achieve new growth and
prospects. The risk manager can identify the current risks which the organisation is facing
and the things which are making its customers suffer from having better transparency
within the organisation. The risk manager needs to evaluate the important aspect which
makes an organisation and its strategies suffer. These risks if evaluated well by the risk
manager can allow the AB Ltd. to achieve set growth and advantage in its Insurance and
risk consolidation. These changes can bring impact on the customer's loyalty and can
raise their transparency towards the organisation. In order to ensure this, proper
transparency can allow the organisation maintain its set standards.
 Cybercrime/cybersecurity: It is important for the risk manager to set up a team whose
main job is to identify cybercrime issues. This can help the organisation to create its set
place in the market and maintain its reputation while purchasing of insurance. The issue
of cybercrime is large and the set team of the organisation will help in resolving such
issues with the help of effective software and applications. The software available in the
market tends to allow robbers to easily get access to the data such as data stealer,
premium service abuser, click fraudster, malicious downloader etc. It can create
situations where the organisation faces difficulty in managing its data and employing
right standards while entering into online business. In order to ensure this, that data is not
being stolen, the set team by the risk manager is going to help AB Ltd. in properly taking
care of the data which is being stolen. (Adams, Hoejmose and Kastrinaki, 2017). It will
foster growth of the organisation and would create an environment where its data is saved
for the right purposes. The customers of the organisation need to be provided with
required safety and security in which they can have access to their insurance information
with a set password and identity. It can allow the organisation to foster growth and
development and ensure that its data is safe and secure. The risk manager of AB Ltd. can
install spying tools where the data can be handled well. It is important for the
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organisation and its management to ensure that right systems are set in place to achieve
set growth and development for the organisation.
Recommendation
As per the above analysis it can be seen that the risk manager can bring a lot of success to
the organisation and can improve its overall efficiency. The role of the risk manager in AB Ltd.
is to provide the organisations with directions in which it can reduce associated risks and can
maintain a better market position. It can help the organisation to improve its performance and
deliver best results. The manager in AB Ltd. can identify at what places it is lacking growth and
development and what is making the organisation suffer in terms of achieving better growth and
advantage. These risks needs to be evaluated well and risk manager is the only authority which
can help the organisation in achieving set growth and development by identifying the occurring
risks (Feng, 2018). It is important for AB ltd. needs to ensure that at what places its customers
are facing issues and how these issues can create situations of risk. For example, as per the above
analysis, risk manager tends to apply appropriate strategies for the organisation to achieve set
development and growth by minimizing the risks of lack of awareness. In order to ensure that the
organisation is functioning smoothly, it is important to create the right awareness within its
people and ensure better functioning. It can help the organisation to maintain its reputation in the
market and can allow its customers to gain loyalty towards the organisation and its environment.
This loyalty can help the organisation to reach new development standards and maintain is value
in the market. This value can add up to the growth and development of better organisational
practices and can ensure new developments. The customers which are a part of the organisation
will be ensured with a better support and the risk manager would be able to achieve its set goals
perfectly.
Along with it, the risk manager often identifies the challenges faced by the organisation
in developing new strategies to ensure better services to its clients. It is because these challenges
often become the risks in the near future and creates situations where the organisation is not clear
about how effectively it should deal with the set challenges. The risk manager with the help of
the organisation's management resolves these issues carefully and tends to create opportunities
for the organisation to successfully achieve its set goals.
The risk manager can see at what places the organisation is lacking growth and
development and where it is facing issues in achieving growth and development. Issues of
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related to lack of consumer awareness often makes AB Ltd. to face profitability issues. Also, it
dissipates the organisational growth and development opportunities. It is important for the
organisation to ensure that it is reaching its required safety standards and is maintaining its value
in the market. The risk manager can identify the places where it is lacking its growth and is
creating value added standards towards its customer market.
In order to ensure that the risk management is going on properly the risk manager in the
organisation can see risks which are not apparent. This can help the organisation to reach new
development options and achieve set growth. It is important that the risk manager often takes
surveys from the customers of organisation and the employees which are working in organisation
in order to evaluate at what places the organisation can face risks such as improper management
and improper guidance. These risks evaluated by the risk manager can help the organisation in
maintaining its place and creating situations where these risks can be eliminated. The efforts of
risk manager here includes the understanding of the employees and understanding of the
management practices in order to make AB Ltd. To achieve set growth and development. It can
also ensure that the organisation is fulfilling its customer needs and requirements with the help of
its risk manager (Alhassan and Biekpe, 2017). A risk manager can allow the organisation to
maintain its position in the market by clearly analysing the market policies and at what places it
competitors are having a strong advantage. The evaluations can help the organisation to reach
new development prospects along with maintaining its position in the market.
The risk manager can provide insights to the leaders and managers of the organisation.
Providing better insights can allow the organisation to understand the future risks. As being an
insurance company, future risks can make it difficult to grow and maintain its place in the
market. The risks associated with the organisation that can might impact its functioning in the
future if identified in the advance, can help the organisation to reach new development prospects.
The inflation of the market, consumer trends, their changing wants and needs are some major
risks associated with the organisation. Proper strategies can be made in order to eliminate these
market risks and ensure success of the organisational made policies. The risk manager can get
credit for this cooperation to its company. It can help the organisation to reach new development
prospects and achieve new market growth.
Building a better defence to class-actions is one of the core responsibilities of a risk
manager. It allows the risk manager to think clearly about his organisation and pay attention to
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its basic requirements. Such as its customer's needs, what it expects from the customers and what
makes it difficult for the organisation to ensure better provision of the service to its customers.
The risk manager can help the organisation to take required actions in order to achieve set
growth and development. The actions include the required strategies made by firm to reach new
growth prospects and achieve new product advantage. It can help the organisation to reach new
standards of growth and can allow it to understand at what places improvements can be made to
ensure the achievement of set goals and objectives. Making this happen, AB Ltd. can observe
what it needs to do to raise its customer awareness as well.
In order to understand the places and point of judgements where its needs to put the right
regulations as per the appearing risks can make it hard for the organisation to reach new
development prospects. (Dafny, 2015). One of the most important aspects for the organisation is
to reach new development prospects, it can be achieved by maintaining new growth and allowing
the organisation to thrive in the market. The risk manager can ensure this by setting out
appropriate goals for the organisation.
CONCLUSION
The report provides brief discussion on risk consolidation and purchase of insurance. It
covers what issues AB Ltd. is facing while ensuring provision of better insurances to its
customers. These issues include lack of awareness, lack of transparency and issues of cybercrime
and cybersecurity. The report explores in what ways the hired risk manager can resolve these
issues for AB Ltd. Strategies build by the risk manager to ensure better provision of insurances
to the customers and raise their awareness while buying insurances are explored in the report.
These strategies include clearing of their issues, understanding their requirements, and
developing the insurances as per their wants. Along with it, the report discusses in what manner
the organisation's efficiency can be raised where it can effectively start its operations on online
platforms. The risk manager identifies the risks associated with online operations and activities
and how these risks can be managed to make AB Ltd. successfully reach new customer markets.
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REFERENCES
Books and Journals
Adams, M., Hoejmose, S. and Kastrinaki, Z., 2017. Corporate philanthropy and risk
management: An investigation of reinsurance and charitable giving in insurance
firms. Business Ethics Quarterly. 27(1). pp.1-37.
Alhassan, A. L. and Biekpe, N., 2017. Liberalization outcomes and competitive behaviour in an
emerging insurance market. African Development Review. 29(2). pp.122-138.
Altuntas, M. and Rauch, J., 2017. Concentration and financial stability in the property-liability
insurance sector: global evidence. The Journal of Risk Finance. 18(3). pp.284-302.
Bikker, J. A., 2016. Performance of the life insurance industry under pressure: Efficiency,
competition, and consolidation. Risk Management and Insurance Review. 19(1). pp.73-
104.
Bruckner, T., 2016. Agricultural Subsidies and Farm Consolidation. American Journal of
Economics and Sociology. 75(3). pp.623-648.
Chang, M. S. and Elyasiani, E., 2015. Do insurance activities enhance the performance of
financial services holding companies?. Applied Economics. 47(33). pp.3559-3576.
Dafny, L., 2015. The Risks of Health Insurance Company Mergers. Harvard Business Review.
https://hbr. org/2015/09/the-risks-of-health-insurancecompany-mergers.
Feng, X. L., 2018. Undiagnosed and Uncontrolled Chronic Conditions in China: Could Social
Health Insurance Consolidation Make a Change?. medical care Research and
Review. 75(4). pp.479-515.
Lin, J. H. and Li, X., 2017. Regulatory policies on Gramm-Leach-Bliley consolidation of
commercial banking, shadow banking, and life insurance. Journal of International
Financial Markets, Institutions and Money. 50. pp.69-84.
Mühlnickel, J. and Weiß, G.N., 2015. Consolidation and systemic risk in the international
insurance industry. Journal of Financial Stability. 18. pp.187-202.
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