Insurance
A significant portion of our consulting practice is in the area of corporate insurance. Our knowledge and experience in corporate risk and insurance management is second to none. We keep on top of changes in the scope of policy wordings, the law as it pertains to insurance, and the prevailing insurance market conditions and rating in Canada, the US, and internationally. Courts have accepted our expert witness on matters pertaining to insurance on more than a dozen cases.
Insurance Audit
An insurance audit provides a detailed grassroots analysis of the corporate insurance program and the scope, amount, and quality of coverage for your insurable risks, viz:
Will the insurance respond to the full range of operational risk exposures?
Are the limits adequate for worst-case loss?
Are the various policies integrated with no gaps or overlaps?
Are there any unusual exclusions, warranties, or other terms that could potentially threaten full indemnity?
Are deductibles and self-insurance arrangements cost-effective within the corporate risk tolerances?
Are rates and premiums reasonable?
Are there opportunities for improving Value-For-Money?
A line-by-line technical audit of each insurance policy wording examines each exclusion, condition, restriction, basis of loss settlement, and insuring agreement for potential effect on indemnity following a loss. We evaluate whether all commercially-available coverage extensions have been incorporated where required.
Property values are audited for adequacy. Business interruption exposures are identified and assessed. The full range of potential liability risks including E&O, D&O, and cyber liability is assessed. Insurance representations, warranties, and disclosure are reviewed. Insurance rates are evaluated for competitiveness, against both prevailing market rates and benchmarked peer-group rates. Policy documentation, schedules, and invoicing are audited for accuracy and completeness. Broker performance is benchmarked.
In summary, a Sigma Risk insurance audit objectives and thoroughly examines each component of corporate insurance management: coverage, cost, quality, and service.
Insurance Purchasing and Tenders
Often, clients ask us to help with the insurance tender process, and then help evaluate the results, especially coverage. We ensure our client obtains a competitive advantage in insurance costs, coverage, and quality.
We have assisted clients in more than two hundred corporate insurance competitions (both formal and informal), using best practice processes. Our track-record is a smooth, well-prepared, and incident-free tender, with quality team consensus and results.
Cyber Risk & Insurance
Over the past ten years, cyber risk has increased for pretty much everyone, as has the array of cyber insurance products.
Sigma Risk consultants have remained on top of these changes, as well as annually update our data on breach losses and changing legal liabilities associated therewith.
Cyber risk assignments have included those for financial institutions, health care, municipalities, energy, governments and associations. We have assembled most of the available cyber insurance policy forms. Our cyber risk assessments skills are focused on the cyber issue of adequate but not excessive insurance limit.
Insurance Claims
When a corporation has a large insured property or business interruption loss, it faces the challenging process of quantifying, documenting, and proving the insurance claim. From time to time, adjusters and their experts can be demanding. Their interpretation and quantification of insured loss costs can be biased and inequitable.
Also, often underestimate the time, effort, and complexity in successfully making a large property, business interruption, pollution, machinery breakdown, or extra expense insurance claim. Many rely only on the insurer’s adjuster.
Sigma Risk has considerable large insurance claims management experience, technical knowledge, and objectivity. We have calculated, documented, and settled more than sixty large ($10 million - $1 billion) insurance claims. Because of our professional credentials and approach, our fees are generally covered by the professional fees extension in the policy.
Lender Insurance Reviews
On behalf of lenders and investors, we conduct due diligence risk and insurance audits on the borrower's operations, operational risks, and insurance coverage and security.
We have worked for all of the major banks in Canada and for banks all over the world (including the World Bank). We go beyond the checklists used by other insurance auditors and look at how the borrower's operations actually fit within the four corners of its insurance policies, particularly in respects of maximum foreseeable loss and insurance limits. We look for black swans.