Whether it's new equipment, property investments, or employee retention programs, you're looking for more ways to fund the initiatives that improve your business.
One place to find additional capital is your risk management program. Considerable unbudgeted expense develops when the event of a claim occurs. Such as lost productivity, the costs of rehiring, and reputational/brand damage (to name a few).
By the way, your insurance carrier does not cover these expenses. Your margins and budgetary surplus absorb them.
To understand the impact, here are three questions to ask:
- What is the actual cost of your incurred claims? To quantify this, you will need to measure the complete cost structure of your risk management program. You must examine each claim's direct and indirect costs to see the whole picture.
- How do those claims erode your existing margins and business performance? Remember, these expenses go deeper than simply the price of insurance. Every claim costs your business time, additional capital, and resources to resolve.
- How much of this financial leakage is recapturable? The answer to this question will require a plan and resources to mitigate the frequency and severity of your claims. It's all tied together. A strategy is the only way to recoup and measure these costs.
Speaking of a plan, we're here to help you sort through this complex process. As Certified Analytic Brokers, we're uniquely qualified to analyze your cost structure, pinpoint focus areas, and apply our specialty resources to create a quantifiable impact. We go beyond the placement of risk management to help you recapture wasted capital.
The overall performance of your risk control program impacts far more than the price of your insurance. The frequency and severity of your claims may negatively impact your business outlook, profitability, and strategic goals.
Yes, you pay out of pocket for premiums, deductibles, and any self-insured program costs, but additional and significant expenses exist inside most programs. These expenses negatively burden your financial performance and shrink your margins.
What are these unwanted expenses?
Financial leakage occurs when a claim event happens in your organization. The carrier will cover a portion of the incident, but your business will absorb the remainder. Lost productivity, brand damage, and the costs of hiring and retraining employees (to name a few line items) erode your growth potential.
So, how do you measure and reduce this unwanted impact?
- Work with a broker who can analyze your entire cost structure, including the financial leakage. They need to identify the recapturable capital and pinpoint the areas for strategic improvement.
- Devise a strategy to reduce the claims frequency with specialty resources, projects, and processes that are proven to mitigate incidents.
- Keep measuring outcomes! Identifying and putting together a plan is only the first step. To meet your program’s ultimate potential, you need to quantify the impact to fine-tune the cost-recapturing process.
Where to start in this critical process?
We’re here to help.
As Certified Analytic Brokers™, we’re uniquely qualified to help quantify your entire cost structure. We’ll provide you with a no-obligation assessment of your existing program, what it’s costing you, and how it impacts your KPIs. Next, we’ll offer you some suggestions on how to improve your results!
Did you know the premium and deductibles you pay for insurance are likely the smallest part of the ‘true cost’ of your risk control program?
Consider this: When a claim event occurs, your organization absorbs substantial additional costs, such as lost productivity, hiring and retraining expenses, and any brand or reputational damage you may have incurred due to the incident.
Who pays for that? Your insurance policy does not cover those expenses. They are in addition to any out-of-pocket costs paid to obtain/maintain the insurance itself.
To account for them (and recapture some of the financial leakage), you have to be able to quantify them on your financial statement.
Here’s what you need to know:r:
- The actual cost impact of claims. What did your organization pay beyond the price of your insurance placement and deductibles?
- The effect claims had on your profits, growth, and operational expenses. How did these costs affect your business model and goals?
- Is your broker implementing a plan to mitigate these unwanted expenses? Do we have a plan in place to lower the frequency of our claims?
If your broker cannot provide you with those critical pieces of information, you may have to look elsewhere to get the data you need to improve your results.
If you’d like us to help, we’d be glad to. As Analytic Brokers, we’re uniquely qualified to offer a deep-dive cost assessment of your risk control program.
We’ll provide a no-obligation review of your existing cost structure and offer solutions to recapture and mitigate claim-related capital. Contact us today!
Have you outgrown your existing risk financing and insurance services provider? It can be challenging to tell when you should consider a change.
Here’s the truth: an effective broker does far more than place your risk financing programs. They align with your business goals and work to help you achieve them.
Virtually all brokers have access to the same insurance carriers, captive managers, or specialty programs. The difference in the price of insurance programs is a small variation between most brokerages. This means your greatest financial performance opportunities do not come from competitive pricing alone.
To get the BIGGEST benefit, you need a risk management partner that knows your business and has resources available to help improve your bottom line.
So, how do you know if it’s time to make a change?
First, ask your existing broker some key questions:
- What’s our total “controllable expenses” leaking from our financial statement due to the costs of claims? Not hard costs, like deductibles, but the costs of business interruptions, hiring and training, equipment replacement, etc. when a claim occurs and impacts our day-to-day business operations.
- What is the impact of these unbudgeted expenses on our profits and business performance? How much is this risk program really costing us?
- What are your plans to help us "recapture" this Financial Leakage? And, can you measure your results for us when it’s time for review?
Suppose your existing broker is unable to answer these questions or provide you with the information you need to make the BEST business decisions possible. In that case, you are likely being underserved and should consider other options.
As an Analytic Brokerage, we are uniquely qualified with the tools and insight to help you get the most out of your risk management program. Moreover, we quantify our work and show you exactly how our specialty services move your numbers.
Not sure where to start in this process?
Contact us today for a no-obligation assessment of your program. We’ll be happy to provide you with some insight into your business and how we can deliver quantifiable results.
Like most businesses, you are dealing with price increases beyond your control. Now more than ever, organizations are looking to reduce their expenditures to lessen the impact of inflation.
One critical component to cost structure (that businesses often overlook) is the amount of CONTROLLABLE wasted capital inside your risk management program.
These potential savings go far beyond the price of insurance.
Here’s what you can do:
Curb the rising costs of goods and services by reducing the severity and frequency of claims inside your organization. How? By implementing the proper resources and programs to improve your risk management practice.
Free up more capital to counter the impact of inflation. When you are not absorbing lost productivity, the cost of replacing equipment, or the impact of business disruption when claims occur, you have more capital and opportunities to grow your business.
To do this, however, you need to work with a broker that understands the importance of (and can measure) these financial metrics to provide you with cost savings.
As an Analytic Brokerage, we are uniquely qualified to help you identify, measure, and recapture these unwanted expenses, so you can better weather a volatile market.
Contact us today for a complimentary assessment. We’ll provide you with an understanding of where cost reduction can occur in your business and a strategic plan to address it. .
The price of risk management services does not equal the overall cost of your buying decision. A price-driven policy won't address the additional hidden expenses from turnover, business distribution, equipment replacement, reputational damage, etc., that accrue from claims and often add to your overall cost structure.
When making a significant buying decision for your business, you should consider all the additional costs associated with the purchase.
Your insurance program is no different.
While your existing broker may find you the cheapest policy with a competitive carrier, they're often not considering the significant additional costs eroding your bottom line when claims happen.
To mitigate these expenses, you must go deeper than the price of the insurance policy. You need a broker that can identify the financial leakage points in your business model AND put together a plan to mitigate them. Further, you need a broker that can track these results.
That’s where we can help.
As an Analytic Broker, we're uniquely qualified to address these bottom-line issues with proper risk control and specialized resources. Moreover, we have the capabilities to measure and monitor our performance to provide you with a clear ROI.
Contact us today for a complimentary and comprehensive examination of your program.There’s no obligation for our assessment, and you may be surprised to learn that you’re leaving a lot of money on the table without a strategic plan to address the problems.
It’s that time of year again: Tax Season! Over the next few weeks, many businesses will be reminded of the "lost opportunities" derived from their operational expenses.
No matter your EBITDA or profit margin, the I.R.S. shrinks your capital. This cash depletion can often take months to recover.
So, what is the best way to recoup this annual hit to your bottom line?
. . . don't let it leak away in the first place!
Many businesses are not aware of the hidden expenses that eat away at their margins year-round. These unbudgeted expenses hide in your risk management programs and are not covered by the insurance companies.
They are attached to claims events, not premium or deductible costs.
When a claim occurs, productivity disruptions, equipment replacements, reputational damage, and other culprits erode your financial statement.
You may be asking yourself, "OK, how do I stop it?"
Great question! We're here to help.
As Analytic Brokers, we're uniquely qualified to help you replace your tax bill expenditure by finding and addressing the Financial Leakage (mentioned above) that currently exists inside your risk control and risk financing program.
Contact us today and we’ll provide you with a no-risk assessment of your current cost leakage and a detailed plan of action to recapture these critical expenses.
Don't let another tax year come and go without protecting your hard-earned capital!
Cost increases are never good for business, and your risk management program is no different. For years, brokers have been telling you the best way to cut the costs of your program is through policy changes, deductible options, or new funding mechanisms.
Unfortunately, none of these “solutions” maximizes cost control.
They’re all variables in the cost of the commodity and are determined by the marketplace. When you go this route, you’re chasing the wrong rabbit.
But, there are some critical expenses inside of your program that you CAN control. Financial Leakage that stems from claims events is a great place to start.
What is Financial Leakage?
It is the additional, frictional, unbudgeted expense of a claim event that ripples through your organization and is absorbed by reducing your margins. Think of the operational disruption inside your organization that your insurance policy does not cover.
What can you do to mitigate Financial Leakage?
- Measure the areas where it’s occurring inside your cost structure. You need to know where the problem areas are.
- Determine how this Financial Leakage is eroding your profits, margins, EBITDA, and budget surplus (non-profits), so you can budget accurately.
- Work with a broker who understands how to recapture these costs using specialty resources designed to improve your business performance.
As an Analytic Broker™, we’re uniquely qualified to help you achieve these steps.
We’ll chase the right rabbit and measure the impact these unwanted costs have on your financial statement. Moreover, we’ll build a strategy to help you reduce them over time.
The end result?
- Improved profits
- Improved EBITDA
- Accurate budgeting
Let’s get started... Please contact us for a complimentary Financial Leakage Assessment to see what we can do for you.
One of the most overlooked and IMPORTANT ways to improve your business model is by quantifying and attacking the Financial Leakage that currently exists on your financial statement. All organizations: large, medium, or small (for-profit or non-profit), suffer from the slow burn of unaddressed Financial Leakage.
In fact, you may be paying 30 - 50%* more for your Risk Management program than you expected to in your budgeting forecasts.
Unfortunately, each time a claim event ripples through your organization, Financial Leakage manifests as “frictional costs” or “hidden costs” via lost productivity, reputational damage, or business disruption.
Here are 3 Steps you can take to mitigate the damage:
- Analyze your current Risk Management program and identify areas where Financial Leakage is eroding your financial statement. We can help you do this if your existing broker is unable to or unwilling.
- Create an executable action plan with specialty resources to “plug the holes” and address your financial erosion over time. Again, we’re happy to provide you with a complimentary assessment.
- Monitor your Financial Leakage and Total Cost of Risk to ensure that the programs you’re implementing are doing the right thing. For example, we provide our clients with an annual scorecard so they can see the results of our efforts on their behalf as it relates to EBITDA improvement and more. This scorecard gives them much better insight to strengthen their financial decision-making.
The Bottom Line: You can’t grow the way you want to grow as you experience missed opportunities and lost profitability because of your Financial Leakage.
Do you want to operate at your maximum efficiency and potential? Are you curious to know more about your Financial Leakage? Would you like us to help you quantify areas where you can improve? We’re happy to assist.
As Analytic Brokers, we have the tools, insight, and analytics needed to quantify and address your Financial Leakage.
As Analytic Brokers, we have the tools, insight, and analytics needed to quantify and address your Financial Leakage. Please contact us for a complimentary Financial Leakage Assessment to see what we can do for you. You might be surprised to see how much additional capital you’re currently leaving on the table.
Aside from year-end tasks and holiday events, ‘tis the season for insurance renewals. You’ll likely be meeting with insurance brokers soon to determine the right risk management program for your business in 2022.
In the past, you’ve explored coverages and premiums.
This year, you can (and should) expect better for your business and your financial statement. There is likely a sizable sum of unfunded expenses that your business absorbs that are not covered by the insurance carriers. This Financial Leakage is a direct result of the unbudgeted impact that accompanies each claim event you experience. Lost productivity, brand damage, and the cost of replacing equipment are a few examples of these expenses.
Unfortunately for your organization, these expenses are typically not discussed in the renewal process, leaving you without the ability to measure the effectiveness of your insurance program properly.
You deserve to know much more than the basics of premiums and coverages. The true costs of your risk management program go much deeper than that.
Here are Four Critical Questions you should ask your broker during renewal:
- What is the impact you have had on our business results (profits, EBITDA, budget accuracy) over the last year?
- What impacts should we expect inside our cost structure in the coming year?
- What risk management projects will you implement in the coming year to reduce our cost structure?
- How can we quantify your impact using benchmark data and key metrics.
As a Certified Analytic Broker, we are uniquely qualified to answer these questions for you during a complimentary consultation. We’ll attach our answers to your key metrics and help you measure your organization’s cost structure in 2022 and beyond.
Best of all, we’ll develop a data-driven plan to help you measure and recapture these controllable costs to improve your business performance in 2022 and beyond.