Insurance & Risk Management

1. Insurance & Risk Management “Risk – the chance that something great might happen” By PP Don Shields, District 9780 Insurance Officer & Risk Management Officer. Assisted by DG Brian Trenery

2. Agenda What is Risk Management Why is it important When should it be done Who in your club need to do it How do you do it AS/NZS ISO31000:2009 What happens to it once done Things to remember Practical example Questions

3. Insurance & Risk Management Take risks, if you win you will be happy, if you lose you will be wise” Author Unknown

4. Insurance & Risk Management What is Risk Management? “Risk management is the system or process used to consider all risks that could impact a project or activity, so that we can avoid, reduce or control those acceptable risks, and so that we can ensure we don’t undertake activities that can’t be insured against or are considered unacceptable” Author PP Don Shields (DIO)

5. Insurance & Risk Management Definitions (AS/NZS ISO31000:2009) Risk: The effect of uncertainty on objectives Risk Management: Co-ordinated activities to direct and control an organisation with regard to risk

6. Insurance & Risk Management Why is it important? Ignoring the risks which apply to your project, activity or the events you have planned could impact on the following: • the health and safety of members, volunteers, employees, customers, other participants & members of the public in general • your individual reputation, credibility and status • public and customer confidence in your club (& Rotary in general), • attracting & retaining members in your club (& Rotary in general), • your club’s financial position – having to pay the policy excess, plus it could adversely effect future club fundraising • plant, equipment and the environment. A systematic approach to managing risk is now regarded as good management practice.

7. Insurance & Risk Management When should it be done? Risk Management is a “living” process, and should be undertaken at all stages of the planning process, and added to or changed where necessary. This means Risk Management should start when preliminary planning is undertaken and is an integral part of the decision process as to whether a project is viable and given approval by the Board of your club. It is then developed at the same time as planning for the activity. It is NOT any afterthought or “butt covering” exercise.

8. Insurance & Risk Management Who in your club needs to do it? Risk Management should be undertaken by the person or committee tasked with planning the project or activity – as they should be intimately familiar with the activity or project. The Risk Management Plan can be developed by a single Rotarian or sub-committee – its up to your club. The most important thing is that it is completed & independently checked.

9. Insurance & Risk Management How do you do it? Rotary’s National Insurance Committee has developed some simple forms which can be found on the District Website. You can use these if you wish. It’s a simple matter of filling in the gaps. Alternately, should your club have a Risk Management Expert, they can use their own forms & make it as simple or difficult as they like – the most important thing is that your club does it for every activity! Note: Don’t reinvent the wheel. For example, on a vocational visit, ask the venue if they have a completed Risk Management Plan. Use it, review it for relevance & inform participants of risks.

10. AS/NZS ISO31000:2009Risk management – Principles & Guidelines Creates value Integral part of organisational processes Part of decision making Explicitly addresses uncertainty Systematic, structured and timely Based on best available information Tailored Takes human and cultural factors into account Transparent and inclusive Dynamic, iterative and responsive to change Facilitates continual improvement and enhancement of the organisations Mandate & Commitment Establishing the context Risk Assessment Design of framework for managing risks Risk identification Communication and consultation Monitoring & review Implement risk management Implement risk management Risk analysis Risk evaluation Monitoring & review of the framework Risk treatment Principles Framework Process

11. AS/NZS ISO31000:2009 Risk Management Framework • Mandate and commitment • Design a Framework for managing risk • Implement Risk Management • Monitor and Review the Framework • Continual Improvement of the Framework

12. AS/NZS ISO31000:2009 The Process – Establish the Context • Understanding the external environment in which we operate in • Political Climate • Industry Regulations • social and cultural views of the community • Understanding the internal environment • Organisational Objectives • Culture • Business Systems & Procedures • Understanding the Risk Management Context

13. Qualitative Risk Analysis Matrix – Level of Risk Likelihood of Loss Consequence of Loss Insignificant Minor Moderate Major Catastrophic Almost Certain Moderate Significant High High High Likely Low Moderate Significant High High Moderate Low Moderate Moderate Significant High Unlikely Low Low Low Moderate Significant Rare Low Low Low Low Moderate AS/NZS ISO31000:2009The Process – Establish the ContextDefine Risk CriteriaHow consequences will be measuredHow will likelihood be definedHow will be prioritise risk

14. AS/NZS ISO31000:2009 The Process – Risk Assessment • Risk Identification • Whether or not under our control • Tools available include: workshops, interviews etc • Risk Analysis • What are the consequences • What is the likelihood • Risk Evaluation • Prioritisation

15. AS/NZS ISO31000:2009 The Process – Risk Treatment • Is the risk tolerable? • What are our options? • Avoidance • Increase the risk • Change the likelihood • Change the consequences • Transfer the risk to someone else • Prepare Treatment Plans

16. AS/NZS ISO31000:2009The Process Monitor & review Communication Integral to every step Informs the entire process Ensures engagement and understanding • What has changed? • Organisational objectives • People • Processes • Maintain records • Identify opportunities to improve

17. AS/NZS ISO31000:2009 • Takes into account human & cultural factors • Transparent and inclusive • Dynamic, interative and responsive to change • Risk management facilitates continual improvement Principles of Effective Risk Management • Create & Protects Value • Integral part of organisational Processes • Part of decision making • Explicitly addresses certainty • Systematic, structured & timely • Based on best available information • Tailored

18. AS/NZS ISO31000:2009 The Benefits of Risk Management Helps create Certainty Understand and exploit opportunities Improved planning, performance and effectiveness Protect our Reputation Protection of Directors Good governance

19. Insurance & Risk Management What happens to it once done? The following is good management practice: Independently checked Approved by Board of your Club as part of Project Approval process (before activity or project commences) Brief/Inform participants Have present for reference during event Review, evaluate & update it for the next time the same activity is conducted

20. Things to remember • Don’t forget to undertake Risk Management • Don’t forget to have it independently checked • Don’t forget to have Board approval • Don’t forget to brief or disseminate to participants • Don’t forget to take to activity for reference • Don’t forget to review post activity Insurance & Risk Management

21. Insurance & Risk Management Brief Summary of covers – see District Website: Policy Types: 1. Public & Products Liability 2. Personal Accident & Travel 3. Industrial Special Risks 4. Association Liability 5. Crime 6. Caravan/Trailer (optional & not selected)

22. Caravan / Trailer This cover is optional & was not selected this year. Clubs have been advised for several years now to insure their own trailers. Cover is available for less locally with lower excesses when compared to this insurance. If your club owns a caravan/trailer, please check to see if your club has insured it.

23. DIO Role & Responsibility Risk Management advice to DG and Clubs Risk Management training to Assistant Governors Insurance presentations at PETS, Assemblies etc Travel Insurance support & advice to YEP Provision of Insurance Certificates of Currency Prompt incident & claims reporting to Aon & NIC Advice & support for District Property Officer Completion of annual Insurance Return to Aon (taken directly off RDU website 26/4/11)

24. Things to note (to stop DIO being grumpy) DIO does not complete Risk Management for you DIO does not require completed Risk Management documents to be sent in (unless you are asked) Requires an Incident Report Form for every incident as soon as possible Asks that you read the summary before making contact Does not want to know about every activity or project in the District, ONLY those that are clearly not covered or you are unsure of whether cover automatically applies Asks for a quick email (not phone unless absolutely no alternative) – these are my only record of your enquiry

25. Insurances & Risk Management Practical example

26. Insurances & Risk Management Any Questions?

27. Contact details Don Shields 0419 390 303 don@gibvic.com.au