Risk Management Policy
|Approved by:||Board of Trustees|
|History:||Issued -- March 14, 2002|
|Responsible Official:||Director of Environmental Health and Safety, tel (202) 319-5789|
Risk management is necessitated by the uncertainty of loss and liability relative to the University's property and the actions of those individuals representing the institution. According, the University ensures that the human, property, and financial assets of the institution are adequately protected through a program designed to: 1) identify potential losses; 2) measure the impact on the resources of the University should a loss occur; and, 3) apply appropriate risk handling techniques to minimize the effect of a loss on the University.
This policy applies to all faculty, staff and student organizations.
II. Procedures and Regulations
- The Director of Business Services is responsible for the University's risk management program including the identification, measurement, evaluation, reduction, and monitoring of risks; the purchasing of insurance when deemed appropriate; and the processing of claims.
- The University is able to predict certain risks and thereby budget for related losses, which are financially limited. Therefore, it is not the institution's practice to insure against all foreseeable and bearable expenses when acceptable alternatives can be achieved.
- When purchasing insurance, the University will consider the scope of coverage, the services offered by the insurer, the reliability and financial stability of the company, and the price of the coverage as competitively determined. Only the Vice President for Finance and Treasurer and the Director of Business Services are authorized to negotiate or secure insurance coverage on behalf of the University. They shall consult with the cognizant Vice President where appropriate.
- At a minimum, the University will purchase the following insurance coverages and limits:
- Property Insurance (To Include Boiler & Machinery and Inland Marine): Sufficient Value to Replace the Institution's Physical Assets
- General Liability: $1,000,000 Per Occurrence
- Excess Liability: $15,000,000
- Umbrella: $25,000,000
- Directors & Officers: $5,000,000
- Auto Liability: $1,000,000
- Workers Compensation: Per D.C. Statutory Limits
- Crime: $1,000,000
- Fiduciary: $1,000,000
- Employed Lawyers: $1,000,000
- An independent insurance broker shall be retained on a fixed fee basis. Selection of a broker shall be based on service, depth of knowledge and experience, access to broad markets and fee. A competitive review of broker services shall be conducted at least every five years.
- Services of an insurance broker will be used to independently verify that adequate coverage is maintained, and to market the University's insurance program for the best price and form of coverage. The broker shall competitively bid each policy line at least once during a five-year period.
- A formal audit of University risks will be conducted by an independent expert at least every five years and shall serve as the basis for the risk management plan. The report of the audit will be presented to the Finance Committee of the Board upon completion.
- A full report of insurance coverages, major risks and progress on the risk management plan will be provided annually to the Finance Committee of the Board of Trustees.
- Every employee of the University is responsible for promptly reporting any property loss or potential liability claim to the Department of Public Safety. All losses will be promptly investigated by the appropriate offices (General Counsel, Public Safety, Environmental Health & Safety, and Business Services) and immediately reported to the insurance broker\carrier by Business Services.
- Departments incurring a property loss will be financially responsible for any insurance deductible associated with replacing the item up to a maximum of $1,000.
- The University shall encourage strategies to prevent loss, including training programs and development of educational materials for employees (and students as appropriate) legal and safety audits aimed at early identification and resolution of legal and regulatory compliance risks and cooperation with insurance carriers to take advantage of risk reduction resources.