Group 8

RISK MANAGEMENT
GROUP 8

INSURANCE

Insurance is a contract, represented by a policy, in

which a policyholder receives financial protection or

reimbursement against losses from an insurance

company.
TYPES OF INSURANCE RISK
PERSONAL RISK PROPERTY RISK LIABILITY RISK

includes threats to includes threats to includes threats to
your life or your your personal or your financial well-
physical well-being business property being at the hands of
others injury or death
alleging you to be at
fault.
INSURANCE RISK MANAGEMENT
The assessment and quantification of the likelihood and financial
impact of events that may occur in the customer's world that
require settlement by the insurer; and the ability to spread the risk
of these events occurring across other insurance underwriter's in
the market.
THE NATURE OF INSURANCE
Financial Protection
-help individuals and organizations manage their risks and reduce the potential impact of losses.
Risk Sharing
-reducing the impact of any one person or organization's loss.
Peace of mind
-insurance provides peace of mind to policyholders.
Compliance with regulations

-compliance with these requirements is essential to avoid legal penalties and financial risks.
Business continuity
-insurance can help businesses maintain continuity in the face of unexpected events such as
natural disasters, accidents, or liability claims.
PRINCIPLES OF INSURANCE

Utmost Good Faith

Proximate Cause
Insurable Interest
Indemnity
Subrogation
Contribution
Loss Minimization
WHY BUSINESS FAIL?
Approximately 33% of businesses fail in the first two years, 50% fail within five
years, and 33% make it to 10 years and further.

While there are a number of small businesses in a broad range of industries that
perform well and are continuously profitable, about 33% of small businesses fail
in the first two years, around 50% go belly up after five years, and roughly 33%
make it to 10 years or longer, according to the Small Business Administration
(SBA).
COMMON REASONS WHY BUSINESS FAIL

1 .FINANCING HURDLES
A primary reason why small businesses fail is a lack of funding or working capital. In most
instances a business owner is intimately aware of how much money is needed to keep operations
running on a day-to-day basis, including funding payroll; paying fixed and varied overhead
expenses, such as rent and utilities; and ensuring that outside vendors are paid on time; however,
owners of failing companies are less in tune with how much revenue is generated by sales of
products or services. This disconnect leads to funding shortfalls that can quickly put a small
business out of operation.
2. INADEQUATE MANAGEMENT
Another common reason small businesses fail is a lack of business acumen on the part of the
management team or business owner.
Without a dedicated management team, a business owner has greater potential to mismanage
certain aspects of the business, whether it be finances, hiring, or marketing.

3. INEFFECTIVE BUSINESS PLANNING
Most often business fails due to a lack of short-term and long-term planning. It is vital to have
strategized business plans planned of time – where will your business head in a months’ time to the
next year. A company’s specific business model and infrastructure should be established long
before products or services are offered to customers, and potential revenue streams should be
realistically projected well in advance. Creating and maintaining a business plan is key to running a
successful company for the long term.
4. LACK OF INNOVATION
Our world is moving incredibly quickly, and new and innovative ways to deliver products and
services are emerging every day. Companies must relentlessly innovate so they can keep their
competitive edge. Many companies are hesitant to change established products, services, or
processes – but if they don't, there will be plenty of innovators that are more willing to change.
Those companies will take the lead.
5. FAILING TO BUILD STRONG PARTNERSHIPS AND INTEGRATE WITH OTHERS
No business can operate in isolation, and in today’s world, it's more important than ever to build
strong and resilient partner relationships and supply chains. For business leaders, this may mean
partnering with traditional competitors – a type of cooperative competition called "coopetition” – to
tackle their industries’ biggest challenges.
6. NOT FOCUSING ON MARKETING

Without marketing, you won't have customers. Without customers, you won't have a business. Many
small business owners don't realize they need to be strategic about marketing.
This means having a plan, some measurable goals, and a way to track whether your efforts are
working. Business owners get into trouble when they don't have a marketing strategy, spend too
much money on something that's not working, or get so busy that they neglect marketing altogether.

7. RELYING TOO HEAVILY ON ONE CUSTOMER
It's thrilling to land a big customer or client, but it's risky to depend on one customer to support the
majority of your business.
Even the biggest and most reliable customer can go bankrupt, be acquired by another company,
change management, or just change directions—leaving you and your business scrambling to
replace them.
THANK YOU FOR LISTENING!!!

PRESENTED BY GROUP 8:
Arcino Rikki Joy
Cabrera Mj
Piamonte Erica
Santiago Bianca
Sorizo Julia

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RISK MANAGEMENT

Insurance is a contract, represented by a policy, in

which a policyholder receives financial protection or

reimbursement against losses from an insurance

PERSONAL RISK PROPERTY RISK LIABILITY RISK

Compliance with regulations

Utmost Good Faith

COMMON REASONS WHY BUSINESS FAIL

COMMON REASONS WHY BUSINESS FAIL

6. NOT FOCUSING ON MARKETING

COMMON REASONS WHY BUSINESS FAIL

THANK YOU FOR LISTENING!!!

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