RMC-02-100 MAINTENANCE & INSURANCE: “CLOSING THE CONNECTION”

Description:

Without question, there is a direct connection between the maintenance program in an organization and the efficiency of the risk management/insurance program. This obvious fact is not surprising. What is surprising, perhaps, is that attention to the details of the maintenance program has faded over the past decade, particularly where insurance is concerned, to the point that some may believe it is of little importance. That view is changing rapidly. Currently, as we enter a “hard” market, the impact of an effective maintenance program is a key determinate in not only the price but the availability of insurance. Accordingly, requests for descriptive information that have not been made in years are now coming forward. To the maintenance manager, this may seem both alarming and a bit overwhelming. The purpose of this report is to provide a basic understanding of the forces at play behind this seemingly “new” movement which will allow the maintenance manager to participate meaningfully in insurance placement activity so that the organization benefits from the quality and thoroughness of the maintenance programs it practices. Typically, a greater understanding of this process will better enable maintenance personnel to provide meaningful information to the risk manager; thus, generating positive results in terms of reduced insurance pricing and an increased number of insurance carriers interested in offering coverage.