Risk Management

Risk ManagementJermaine smith

Risk Management What is Risk Management? (in business) the forecasting and evaluation of financial risks together with the identification of procedures to avoid or minimize their impact.

Risk comes in many forms such as:The purchase of a car or houseLeaving a jobMoving from one area to another

Risk Management Risk Management is calculated within many businesses especially within the Insurance Market. Insurance is regulated through the Department of Insurance within that state. Big 3 insurance companies are: All StateNationwideState Farm

Risk Management Each of the three use there own software to calculate the risk of insuring people from their home, car, commercial property, and life insurance. The Department of Insurance takes in a lot of data to decide if the state should raise the insurance rate to cover bad drivers. South Carolina ranks 3rd in the country behind Texas and Louisiana as the worst state for drivers. With a high rank brings high insurance rates to cover the loss do to bad drivers, so companies make provisions to thin out the worst drivers from their books.

Risk Management The big 3 all use the same system to determine risk which is called Lexus Connexus.This software calculates how much of a risk a person will have on the company. If a person is deemed risky they can end up paying higher insurance premiums then a average or good driver. Some of the points of reference which is:Credit reportDriving RecordLapsed insurance coverageHow many claims the person have filed or filed against them