Procedure No. 708.1
Area: Business Services
Description: Risk Management and Insurance
The Director of Business Services will be responsible for establishing and coordinating a risk management program for the purpose of preserving the institution's human, physical, and financial resources through the following:
1. Identification and measurement of risk: All risks of loss will be identified and evaluated by the Director and members of the Safety Committee.
2. Elimination of risk: Conditions and practices which may cause loss will be eliminated or modified whenever possible.
3. Acceptance or assumption of risk: Risk may be assumed whenever the potential loss would not significantly affect the institution's financial position. Exception to this guideline may be made when insurance is required by law or contracted agreement; when it is desirable to buy special services such as legal defense, claims handling, adjusters, engineering, or similar services as a part of an insurance contract; and when the degree of risk, compared with the cost of insurance, dictates the economic feasibility of purchasing insurance coverage.
4. Transfer of risk: Risks may be transferred to other parties through contract provisions or the purchasing of insurance. Insurance will be purchased when the potential loss would significantly affect the institution's financial position. Exception to this guideline may be made when insurance is not available at any cost or when cost of insurance, compared with the risk, indicates that purchase of insurance is not financially sound or when government contracts prohibit the purchase of insurance. Insurance is to be purchased from whatever source (agent, broker, or insurance company) is deemed to be in the best interests of the institution, using the following guideline:
A competitive atmosphere is desired. However, continuity of relationship with the insurance source is advantageous and will be maintained unless there is a significant reason for making the change. Insurance negotiations will be conducted by invitation to selected sources as opposed to bidding. Selection will be based on quality of protection, service provided, and ultimate cost.
5. The Board of Trustees will be kept fully informed of the program claims and settlements.
(See Student Development Services Operations Manual.)
See Also:Facilities Management Procedure No. 915.6
Facilities Management Supplement 1,No. 915.6
Facilities Management Supplement 2, No. 915.6
Human Resources Policy No. 860
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