Property Risk Management
An Introduction to Property Risk
At this point you should feel somewhat comfortable with most of the overall picture of risk, but despite the many examples of risk management and types of coverage you have seen, the details of each coverage are not explicit yet.
In this chapter, we will elaborate on property risks, including electronic commerce, or e- commerce, risk and global risk exposures.
The most important part of property coverage is that you, as the first party, are eligible to receive benefits in the event you or your business suffers a loss.
In this chapter we focus on the first type: coverage for you when your property is damaged or lost.
In personal lines coverage such as homeowners and auto policies, the property coverage for losses you sustain, as the owner of the property, is only part of the policies. In commercial lines, you may use a packaged multilines policy that includes both commercial property and commercial general liability policies.
In this module we focus only on the part of the policies relating to the property coverage for first- party damages to you. As part of your holistic risk and risk management, it is important to have an appreciation of this part of the coverage.
As we develop the holistic risk management program, you now realize that you need a myriad of policies to cover all your property exposures, including that of e-commerce, and another myriad of policies to protect your liability exposures.
In some cases, property and liability coverages are packaged together, such as in homeowners and auto policies, but what is actually covered under each? Our objective is to untangle it all and show how to achieve a complete risk management picture.
To achieve complete holistic risk management, we have to put together a hierarchy of coverages for various exposures, as shown in Table 11.1 (highlighted risks indicate property or first- party-type risks applicable to this module).
Table 11.1 Links between Property Risks and Insurance Contracts
Our work will clarify many areas of property and liability of various risks, including the most recent e-commerce risk exposures and the fundamental global risk exposure. In this module, we cover the following:
1. Property risks
2. E-commerce property risks
3. Global risks
END of UNIT
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