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Chapter 17Chapter 17
Risk Management, Risk Management, Insurance, and Insurance, and
Crime PreventionCrime Prevention
McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.
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Risk Management, Insurance,And Crime Prevention
Defining & Coping With Defining & Coping With RiskRisk
Insurance & RiskInsurance & Risk Choosing An InsurerChoosing An Insurer Reducing RiskReducing Risk Safeguarding Against TheftSafeguarding Against Theft Protecting EmployeesProtecting Employees
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17 - 3McGraw-Hill/Irwin
Types Of RiskTypes Of RiskPure- UnpredictablePure- Unpredictable
Speculative- VoluntarySpeculative- Voluntary
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Coping With RiskCoping With Risk
AvoidanceAvoidance
Prevention/ControlPrevention/Control
TransferTransfer
Assumption- Self-InsuranceAssumption- Self-InsuranceLawrence Lawry/Getty Images
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Determine Insurance NeedDetermine Insurance Need
What Will Happen If:What Will Happen If:I DieI DieFireFireTheft/EmbezzlementTheft/EmbezzlementRobberyRobberySettlementSettlementUnauthorized InformationUnauthorized Information
Steve Cole/Getty Images
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Types Of InsuranceTypes Of Insurance FireFire Business InterruptionBusiness Interruption CasualtyCasualty Product/Service LiabilityProduct/Service Liability Workers’ CompensationWorkers’ Compensation Group Health/LifeGroup Health/Life Business OwnerBusiness Owner Fidelity/Surety BondsFidelity/Surety Bonds
PhotoDisc/Getty Images
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CoinsuranceCoinsurance
“…“…having the having the business buy business buy
insurance equal to a insurance equal to a specific percentage specific percentage of property value.”of property value.”
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Actions To Improve Safety Actions To Improve Safety and Reduce Premiumsand Reduce Premiums
Involve EmployeesInvolve EmployeesEstablish Establish
CommunicationsCommunicationsCompanywide Companywide
ParticipationParticipationSafety AwardsSafety AwardsExciting ProgramExciting ProgramBe WatchfulBe Watchful
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Small Business Health CareSmall Business Health Care(Employee Contribution With)(Employee Contribution With)
$0
$50
$100
$150
$200
$250
Self
Spouse/DomesticPartner
Spouse/DomesticPartner & Children
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Red Flags OnRed Flags OnAgent SelectionAgent Selection
Delayed Delayed ResponsesResponses
Routine AnswersRoutine Answers Delayed RefundsDelayed Refunds Hand-Delivered Hand-Delivered
PolicyPolicy Claim More Claim More
Expensive Than Expensive Than DeductibleDeductible
Delay TacticsDelay Tactics
Attempts To Attempts To
Minimize DamageMinimize Damage
Secret Claim Or Secret Claim Or
SettlementSettlement
Replace Old Replace Old
Flawed PolicyFlawed Policy
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Criteria ForCriteria ForInsurer ComparisonInsurer Comparison
Financial Stability & Financial Stability &
SafetySafety
SpecializationSpecialization
Tailor PolicyTailor Policy
Cost Of ProtectionCost Of ProtectionPhotoLink/Getty Images
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Insurance RenewalInsurance Renewal
Agent = Minimize PremiumAgent = Minimize PremiumBoost DeductibleBoost DeductibleShop Several AgentsShop Several AgentsProfessional Professional
OrganizationOrganizationSpecial-Risk PoolsSpecial-Risk PoolsSelf-Insurance/CoinsuranceSelf-Insurance/Coinsurance
PhotoLink/Getty Images
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Agent’s ServicesAgent’s Services
Devote Time To Your Devote Time To Your
ProblemsProblems
Exposure To LossExposure To Loss
Recommend Insurance Recommend Insurance
& Loss Prevention & Loss Prevention
Offer AlternativesOffer Alternatives
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CrimeCrimePrevention For ProtectionPrevention For Protection
Zero-Tolerance PolicyZero-Tolerance Policy ScreenScreen TrainTrain Defuse DisputesDefuse Disputes Check SecurityCheck Security Terminate With CareTerminate With Care
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OSHA GuidelinesOSHA GuidelinesTo Prevent RobberyTo Prevent Robbery
Adequate LightingAdequate Lighting
Video CamerasVideo Cameras
Increase Night StaffIncrease Night Staff
AlarmsAlarms
Bulletproof GlassBulletproof GlassRoyalty-Free/CORBIS
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Reducing Reducing Chances Of RobberyChances Of Robbery
Modify Store LayoutModify Store Layout
Secure EntrancesSecure Entrances
Use DogsUse Dogs
Control CashControl Cash
Redesign SurroundingsRedesign SurroundingsDon Farrall/Getty Images
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Sources OfSources OfInventory TheftInventory Theft
Vendor Fraud
6%Shoplifting
32%Employee Theft47%
Admin. Error15%
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Amount Of Theft- 2003Amount Of Theft- 2003
$15
$10
$5
$2
$0 $5 $10 $15Employee Theft
Shoplifting
Admin. ErrorVendor Fraud In $ BillonIn $ Billon
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Preventing TheftPreventing TheftMirrorsMirrorsCameras/MonitorsCameras/MonitorsNoise ActivatorsNoise ActivatorsEmployee Honesty TestsEmployee Honesty TestsSecurity GuardsSecurity GuardsSecurity AuditsSecurity AuditsSpot ChecksSpot ChecksVisible SurveillanceVisible SurveillancePhysical Inventory ChecksPhysical Inventory ChecksRyan McVay/Getty Images
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White Collar CrimeWhite Collar Crime
“…“…committed by committed by managerial, managerial,
professional, and professional, and technical technical
employees.”employees.”
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Types OfTypes OfWhite Collar CrimeWhite Collar CrimeFalsification Of AccountsFalsification Of Accounts
Fraudulent Computer UseFraudulent Computer Use
Bribing OfficialsBribing Officials
CollusionCollusion
Sale Of Proprietary Sale Of Proprietary InformationInformation
SabotageSabotage
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Computer CrimesComputer CrimesIntentional Intentional
Destruction Of DataDestruction Of Data
Fraudulent UseFraudulent Use
Getty Images
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MinimizeMinimizeWhite Collar CrimeWhite Collar Crime
Track CostTrack Cost
Increase BudgetIncrease Budget
Ban CriminalsBan Criminals
Crack Down On Crack Down On
Tax AvoidanceTax Avoidance
Restore RightsRestore Rights
DemocratizeDemocratize
Rein In PayRein In Pay
Regulate TradingRegulate Trading
Expand Expand DisclosureDisclosure
End Conflicts Of End Conflicts Of InterestInterest
Fix PensionsFix Pensions
Foster DiscussionFoster Discussion
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Document SecurityDocument Security
List of Authorized List of Authorized PersonnelPersonnel
No Permission to No Permission to Remove Sensitive Remove Sensitive Document from Document from PremisesPremises
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Workplace SafeguardsWorkplace Safeguards
Guards Over Moving ToolsGuards Over Moving ToolsDevices to Protect Hands Devices to Protect Hands
from Machinesfrom MachinesProtective GearProtective GearWarningsWarningsMedical TreatmentMedical Treatment