Risks can break a business. While some risks can be insured, some cannot. Even for those risks that are insured, they can still affect a business negatively; the process of a claim can eat up valuable resources and time that could otherwise be spent growing the business. It’s therefore important that you assist clients wherever possible with mitigating and avoiding risks.
How to identify a risk
As a broker and expert in your field, you’re particularly well-placed to recognize risks within your industry and some aspects of your clients’ businesses. Risks can come in many forms, from operational and internal risks to ones that you simply cannot avoid – the risk of an Act of God ruining a supply chain, for instance.
There’s the risk that a competitor will arise that decimates your client’s business, or that emerging technology will do away with your client’s target market. Whatever the risk, there are some ways to prevent or pre-empt it.
First and foremost, you should always keep up to speed with industry developments. A technological revolution doesn’t happen overnight. Usually, you’ll get some warning signs of a competitor setting up or a new technology that may affect your client.
Secondly, you need to keep your client updated. This doesn’t just mean an email every so often telling them that they should watch out for such-and-such company. Regular meetings to review their insurance portfolio, their changing needs, and any new risks should be scheduled. This also improves your working relationship with your client. If you wish to go one step further, take a look at our blog post on improving your client relationships.
Plan for the worst
When you’ve identified a risk, work with your client to either find a solution to it, a way to reduce it, or a way to deal with the fallout if the risk does occur. It always pays to plan for the worst. Have enough contingencies in place and if the worst does occur, hopefully, it will pack less of a punch.
Risk comes with every business and every decision. As a broker, your job isn’t just to insure those risks but to stop them becoming issues in the first place. In doing so, you will strengthen your relationship with your clients and also save them (and yourself) a lot of time, hassle, and stress.