Insurance premiums are the price a business incurs to protect 4 key assets: People, Clients, Balance Sheet, and Brand Reputation.
Business owners who only factor insurance premiums into their Total Cost of Risk (TCOR) may not be accounting for 100% of insurance-related expenses that directly impact the bottom line. Insurance premiums account for roughly 50% of an organization’s TCOR.
Contributors to the other 50% add significant indirect and “hidden” costs that balance sheets may not account for. Businesses that understand their TCOR and commit to risk optimization can achieve competitive advantages.
What Contributes to an Organization’s Total Cost of Risk (TCOR)?
Total Cost of Risk is reflected in insurance premiums, deductibles, retention dollars, productivity losses associated with claims, claims administration expenses, revenue losses associated with business interruption, uninsured and underinsured losses, regulatory fines, legal fees, and other “hidden” costs.
Risk optimization allows organizations to identify TCOR contributors and develop specific risk control strategies that drive costs down to levels that reflect organizational risk tolerances. Businesses that effectively optimize risk can see their TCOR flatten out even as revenues grow and risk exposures change!
How Do I Optimize Profits By Optimizing Business Risks?
Business risk profiling is a fundamental component of risk optimization. Your business risk profile is how insurance carriers evaluate your risk exposures against competitors for allocation of limited insurance market capacity.
Increased demands for insurance drive up premiums and other costs. Improving your business risk profile is essential to driving down TCOR and ensuring favorable insurance placement. As a trusted risk advisor, Winter-Dent can guide the risk profiling and optimization process.
How Can I Continuously Improve My Business Risk Profile?
Winter-Dent utilizes a proprietary process called 4sight™ to analyze business risk exposures through digital, physical, financial, and compliance “lenses”. 4sight™ analysis brings TCOR contributors into focus and adapts to changing business conditions. Understanding TCOR contributors allows business owners to establish risk tolerances and allocate resources strategically to reduce exposures, lower costs and improve the Business Risk Profile. Read on to learn more about the 4sight™ risk lenses. Where do you see opportunities to optimize your business risks?
Human Element of Risk
At its very core, optimizing risk is about protecting people and providing a way for them to live and work in confidence. At the end of the day, it’s not about insurance – it’s about people. That’s why the Human Element of Risk is the foundational focal point of the 4sight™ process. At Winter-Dent, it’s about Humans Helping Humans.
Digital Lens
Digital Risk has emerged to be the #1 risk that keeps business leaders up at night. We take the time to evaluate the different facets of your business that are online and connected to today’s virtual world and find ways to lower those risks. Looking at your business through this lens brings into focus all the different areas where you need to protect yourself and your business from the ever-expanding world of digital risk.
Physical Lens
As business owners, we face physical risks all the time. We have assets we need to protect as well as our physical bodies and mental well-being. Our 4sight process of evaluating risk will guide you through a deep evaluation process focused on finding out exactly what your company is made of. This lens is what most people think of when they think of traditional insurance.
Financial Lens
Your financial world is the lifeblood of success. How you manage this fuels every aspect of a business in every stage of development. We live in a world where how we set up the long-term really matters. By taking a deep dive into the benefits you provide to the way you manage how you finance your risk, the advisors at Winter-Dent can help you reduce the impact any financial fiasco might have on you.
Compliance Lens
The complex world of reputation and compliance risk has become increasingly difficult to stay on top of as a business owner. The business world is full of rules, regulations, and safeguards put in place to ensure a healthy business environment for everyone. Through this lens, it’s important that our team of experts help you stay on top of these critical elements of your business.
Contact Us Today
As a trusted risk advisor, Winter-Dent seeks depth of client relationships by integrating our core values into the services we provide. 4sight™ Risk Optimization is an evergreen process that demands execution of our core values - Proactive, Continuous Learning, Transparency, We Do What We Say, Lead by Example, Vested, Other People Matter, and Pay it Forward.
Driven by core values and operating under the principle of Humans Helping Humans, Winter-Dent can guide the risk optimization process for your business and reduce your Total Cost of Risk.
