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2/14 W01/March 2018 Award in General Insurance

I6 Risk managers
For many years, there has been a steady move by firms towards developing a formal strategy for
managing the various risks that affect businesses. Where this is a formalised function within an
2 organisation, particularly a large or diverse company, specialist risk managers are appointed who are
Chapter often members of a professional body such as the Association of Insurance and Risk Managers in
Industry and Commerce (AIRMIC), the Asia-Pacific Risk and Insurance Association (APRIA) or the Institute
of Insurance and Risk Management (IIRM).
The functions of risk managers may be summarised as:
• the systematic identification, analysis and economic elimination or control of risks that threaten the
business;
• providing guidance on best practice in these areas to management; and
• the transfer of appropriately identified risks by contract or insurance.

Question 2.2

In what ways could a risk manager reduce the risk of fire in a company which prints newspapers? Give two
examples.

I7 Compliance officers

In regulating the insurance and financial services sector, many countries have prescribed a number of
key roles that must be performed by a director or senior manager (including insurers and those involved
in insurance mediation). One such role is carrying out the compliance oversight function. In the UK, the
person performing this job is known as a compliance officer and their exact scope of the duties of a
compliance officer will vary from one company to another. However, their main role is to ensure that their
firm abides by the rules and regulations set down by the regulator.
The role is vital to insurers and intermediaries because there are serious consequences of failing to
The role is vital to
insurers and comply with the regulator’s rules. The range of functions undertaken by a compliance officer will usually
intermediaries include:
• communicating company policy to members of staff, including the organisation of any associated
training;
• completing the returns required by the regulatory body relating to, for example, governance, finance
and complaints;
• reviewing business processes to ensure that they are appropriate and compliant;
• maintaining the company’s compliance manual;
• checking that all stages of business processes are being performed in accordance with company
policy; and
• performing the role of Money Laundering Reporting Officer.
Depending on the size of the company, the compliance officer’s role may be ‘hands on’ or it may involve
overseeing some of the functions, with the work being carried out by others in the team. It is even
possible for the tasks to be carried out by an external compliance consultant, however the responsibility
and accountability of the compliance officer cannot be delegated.

I8 Internal auditors

Internal auditors work within companies to monitor and evaluate how well risks are being managed, how
Internal auditors work
within companies to the business is being governed and how internal processes are working. They provide an independent
monitor and evaluate and objective assessment of the effectiveness and efficiency of a company’s operations, specifically its
how well risks are
being managed internal control structure.
Unlike external auditors, they look beyond financial risks and statements to consider wider issues such
as the organisation’s reputation and will also advise on how to improve systems and processes and play
a key role in assessing the reliability of financial reporting and compliance with laws and regulation.