Tag Archives : Risk Management

FERMA publishes guidelines for BEPS on captive (re)insurance arrangements

On 20 June, FERMA has released proposed guidelines for captive (re)insurance arrangements in order to ensure a consistent implementation of the OECD recommendations on Base Erosion and Profit Shifting (BEPS).

Click above to read the document

 

The guidelines are meant to support national administrations when transposing BEPS actions into their national laws. They cover three areas which raised certain questions of interpretation by the OECD members during the implementation stage of the BEPS actions published in 2015: commercial rationale, substance and governance, and transfer pricing – premium setting process.

Jo Willaert, President of FERMA

FERMA’s aim in publishing this information report is to allow OECD members to assess, in a consistent manner, the compliance of captive (re)insurance arrangements with the BEPS recommendations. The report draws on contributions from all its 22 member associations. It explains the concept of captive (re)insurance companies, and for the first time, presents compiled data on premiums, profitability and taxation levels from a sample of 462 captives owned by European resident multinational companies.

The President of FERMA Jo Willaert says, The objective of such guidelines is mainly to avoid creating a patchwork of diverging national legislations inspired by BEPS. Captives serve an important Enterprise Risk Management role with true business purposes for European businesses and other organisations. Although captives are only a very small portion of BEPS, FERMA believes that national authorities should be guided in how to assess captive arrangements according to BEPS recommendations.

Carl Leeman - IFRIMA President

Carl Leeman, FERMA Board member and leader of the captive project group

 “Our document demonstrates that the main financial ratios of the captive insurance industry are in line with the traditional insurance market,” Carl Leeman, leader of the captive project group and a FERMA Board member, stresses. “The paper, enriched and approved by our 22 national associations, represents a strong consensus within the European risk management community on how captives are supporting the operations of their parent organisations.

This report is the first of its type. Although its data comes from European companies, it has global application because the BEPS recommendations are being adopted by many jurisdictions around the world. FERMA, therefore, presented the report to the International Federation of Insurance and Risk Management Associations (IFRIMA).

FERMA also discussed the paper in early June with the tax department of the OECD in the context of the upcoming Public Discussion Draft on Financial Transactions and Transfer Pricing expected this summer.

Press contacts

Typhaine Beaupérin, FERMA CEO: typhaine.beauperin@ferma.eu, tel: +32 (2) 761 94 31

Lee Coppack, press contact: lee@coppack.co.uk, tel: +44 208 318 0330/ +44 7843 089904


Pauline Davoust, Winner Rising Star of the Year, FERMA Awards for Risk Excellence 2016, tells why risk management is such an appealing career.

Pauline Davoust is the Risk Manager, gategroup, Switzerland and SIRM board member. 

FERMA: How did you get into risk management?

I started my career in underwriting and client management in reinsurance and then insurance for various lines of business and discovered the role of risk manager during the risk surveys of my clients.

What drew you to risk management as a career?

I wanted to be closer to all the types of risks that a company is facing, to be able to change their nature and to find the best ways to mitigate them. The interesting part of risk management is dealing with the continuous changes of the environment which affect a company and find solutions. Receiving the first “Risk Manager Rising Star of the Year” award from FERMA confirmed for me that it was the right career choice, and it means a lot to me.

What is your education background?

I studied business administration in France, Sweden and Germany and specialised in insurance during my last year of study.

What do you think can make risk management an attractive choice of career for someone leaving university?

I believe that risk management is equally important to all the other key managerial roles in a company. In addition, it offers very good insight of the “health” of a company and provides interaction with all levels and departments. For these reasons, it makes it a very good career choice.

What do you think are the most useful skills for someone starting in the profession?

In my opinion, someone has good analytical skills, a fast understanding of risks and the ability to think outside the box, and who is solution-oriented can step into a risk management role and learn on the job. In addition you need to be able to communicate at all levels of a company, in various languages sometimes, and also to external stakeholders.

What are your career goals over the next five years?

In my vision, the role of a risk manager will be as fully integrated a process in the company’s strategy as the other key functions, and I will be dealing primarily with emerging risks. An obvious example is cyber risk which has become part of our daily risk landscape; however, the industry still has a long way to go towards full understanding.


Shortlist announced for FERMA & CRE European Risk Management Awards

The shortlist for the inaugural European Risk Management Awards’ Excellence in Risk Management categories has been announced following deliberation by the judging panel at last week’s FERMA Seminar.

The Excellence in Risk Management awards aim to reward high achievement and innovation. As joint hosts of the European Risk Management Awards, both FERMA and Commercial Risk Europe hope these categories will encourage risk managers, insurers, brokers and other service providers.

A 10-strong team of judges, comprising prominent members of FERMA national associations and IFRIMA, have been deliberating the entries for a number of weeks.

The expert judging panel is made up purely from the risk and insurance management community to ensure the awards are designed for risk managers, by risk managers. The panel consists of:

  • Juan Carlos López Porcel, President, Agers
  • Julia Graham, Technical Director, Airmic
  • Gaëtan Lefèvre, President, Belrim
  • Helle Friberg, Darim
  • Gilbert Canameras, Secretary General, Ferma
  • Gilbert Van den Eynde, GvW
  • Carl Leeman, President, Ifrima
  • Slawomir Pijanowski, President, Polrisk
  • Sabrina Hartusch, President, Sirm
  • Niclas Nelson, President, Swerma

Following a meeting at the FERMA Seminar in Malta last week they have now compiled a shortlist for award categories

The 2016 Excellence in Risk Management shortlist is as follows:

Risk Manager of the Year

  • Belgium, Olivier Moumal, Director Audit and Risk, The Proximus Group
  • Denmark, Kristine Raffel, Group Risk Manager, CPH, Copenhagen Airports Ltd
  • Finland, Heljo Laukkala, Vice President, Corporate Risk Management, Metso Corporation

Rising Star of the Year

  • France, Phillipe Cotelle, Risk Manager, Airbus
  • Spain, Elena Gil, Risk Manager, INECO
  • Switzerland, Pauline Davoust, Risk Manager, Gate Group

Risk Manager Lifetime achievement

  • Czech Republic, Jana Bicanová, Risk Manager, Česká telekomunikační infrastruktura a.s
  • Germany, Hans Jörg Schill, Risk Manager, Airport Assekuranz Vermittlungs-GmbH
  • Spain, Ignacio Martinez de Baroja, Risk Manager, HISPASAT

Innovative Insurance Programme of the Year

    • Belgium, Michael Dehert, Risk Manager, The Brussels Airport Company
    • Czech Republic, Branislav Lacko, Risk Project Analysis, Technical University of Brno
    • Spain, Luis Ros Arnal, Risk Manager, ENAGÁS

 

The shortlist for companies nominated for each of the seven customer services categories is as follow:

Captive Management Solution of the Year

      • AIG
      • Willis Towers Watson
      • Zurich

Insurer Innovation of the Year

      • AGCS
      • AIG
      • Swiss Re Corporate Solutions and SBB Insurance AG

Broker Innovation of the Year

      • Aon
      • Arthur J Gallagher
      • Marsh

Emerging Risk Solution of the Year

      • AIG
      • AXA
      • Swiss Re Corporate Solutions

Global Programme of the Year

      • AIG
      • International SOS
      • Zurich

Technological Innovation of the Year

      • AXA
      • Munich Re & Beazley
      • RSA & MSM Software Solved
      • Zurich

Claims Innovation of the Year

      • AIG
      • Chubb
      • Crawford & Company

FERMA and CRE would like to congratulate all of the shortlisted firms. Since the awards were launched in May, there have been over 80 nominations. It is therefore no mean feat and a significant achievement to reach this stage in proceedings.

The winners of the Excellence in Customer Services categories, as well as the Excellence in Risk Management and Industry Leadership designations that make up the European Risk Management Awards, will be announced at a gala dinner on 6 December at Le Plaza Hotel in Brussels

We are delighted by the number of nominations we have received from across Europe and would like to thank all our national member associations that helped us compile such a high calibre list of candidates

The great response to the awards, suggests that the whole risk management and transfer industry supports our aim of raising the profile of the risk profession and highlighting the value FERMA members bring. The fact that the industry has embraced the event bodes well for the future of the risk and insurance management profession, as well as the partnerships needed with risk transfer providers to deliver better solutions.

Ferma and CRE hope to see many of you there for what will be a fun and important night in the risk management calendar.

 


rimap® developments: bridging the gap between education and the profession in Europe

FERMA’s professional certification programme rimap® took an important step forward on 23 June, as FERMA disclosed the names of the first six education programmes in risk management to receive rimap accreditation.

Accreditation is one of the three building blocks of rimap, along with certification and CPD (continuous professional development). It is designed to acknowledge that an education provider’s programme meets the risk management education requirements set by FERMA based on the rimap ‘Body of Knowledge’.

rimap-without-background

Rimap accreditation confirms that the education body is willing to deliver a risk management education programme that is in line with the first European criteria agreed by FERMA associations.

“It is important for the students to know they are following an education programme that is in line with what the profession is expecting. This is best achieved by the professional associations in each country that represent the risk practitioners in Europe,” says Isabel Martinez Torre-Enciso, FERMA Vice President and the person responsible for the accreditation process within the rimap steering committee.


Bridge between academia and profession

Accreditation is also a bridge between the world of risk management education and the professional associations. In 2016, the choice was made to work with a closed list of education bodies that volunteered their interest in the process to FERMA and which were supported by their national risk management associations. For an academic’s view of this process, see the expert view by Marcus Feldt of the Stockholm School of Economics Executive Education here.

“We are pleased to see that the accredited education bodies reflect the diversity of FERMA membership with universities, business schools and professional institutes operated by national associations themselves. The geographical spread also shows that risk management education is developing across Europe, from Finland to Malta.” adds Isabel.

The criteria for accreditation are based on a certain number of hours of teaching, and an 80% match between the rimap Body of Knowledge and the programme. These elements, including the list of teachers and a description of the selection process, were documented by an online submission process through the rimap website.


Continuous Professional Development (CPD)

Finally, we are building the CPD element. We have received a number of requests for licensing for events, and we have so far confirmed to Lloyd’s a CPD license for the FERMA/Lloyd’s Professional Development Programme.

The CPD process is also about to be tested full scale at the FERMA Seminar in Malta on 3-4 October. The details are still to be confirmed, but various Seminar activities should entitle all participants to at least 25 CPD points. These points will be stored electronically on individual rimap accounts for further use when Seminar participants register for the rimap examination: http://rimap-certified.org/


First rimap accredited risk management education programmes

  • Belgium: ICHEC Formation Continue – Diplôme en Risk Management (BELRIM)
  • Finland: University of Tampere – “Master’s Degree Programme in Business Studies – Specialization in Insurance and Risk Management” (FINNRIMA)
  • Italy: ANRA – ALP (ANRA Learning Path)
  • Malta: University of Malta – “Bachelor of Commerce (Honours) in Insurance and Risk Management” (MARM)
  • Poland: POLRISK – “Certyfikowany zawodowy menedżer ryzyka”
  • Sweden: Stockholm School of Economics Executive Education – “Risk Management Diploma” (SWERMA)

A Proud President: Jo Willaert

Jo-Willaert

Jo Willaert

Nine months have passed since I have switched from the position of Deputy President of FERMA to President, and I can say today that I am a proud President:

I am proud of what we have accomplished in that time, for which I thank my board colleagues and the FERMA staff for their support;

I am proud of taking part in the design and implementation of a new strategic plan for FERMA, about which you will learn more in the coming months;

And I am proud of our network, which is growing and becoming more influential for the benefit of the risk managers’ community.

 

Our themes for my presidency are LEADERSHIP – COMMUNICATION – EDUCATION, and I would like to pick out some of our achievements and plans under these headings.

When it comes to leadership, FERMA is the single recognised voice of European risk managers and, as such, its primary mission is to represent the interests of its member associations and their members to the European institutions. Lobbying activities, therefore, have been intensified to strengthen our political impact and promote the fundamental role of risk managers and the value of ERM methodology to EU institutions and other international organisations.

Our member associations are our reason for being. COMMUNICATION with them is absolutely essential for us to deliver tangible added-value. We also want more interaction between members and for members to become more involved in FERMA’s activities. Part of the way we are encouraging this is to enhance members’ feeling of belonging to a European network. We have produced a booklet about the network, which will be enriched over the coming months with more data and information. You can download it here.

I am proud of our certification project rimap®. We took the initiative, and we are leading a trend that is being followed worldwide. This is the evidence that we in FERMA and our associations are the pioneers of the professionalism in risk management. Rimap is a long journey, but it is paying off.

Having focused so much on EDUCATION in 2016, I can tell you that 2017 will be the year of LEADERSHIP. The 2017 FERMA Forum will be in Monte Carlo from 15-18 October, and we have already chosen as our theme ‘Risk Manager in Pole Position’.  It is an appropriate title for Monte Carlo, and for us, too, because it conveys images of risk, performance, anticipation, prevention, crisis management, team spirit and new technologies. The connection with the profession is self-evident.

 


Stating the Value of Captives

Captive insurance companies, especially in offshore domiciles, are under scrutiny from international tax authorities. As the financial or tax aspects of captives are increasingly likely to be challenged, risk managers will need to be able to demonstrate the added value of owning a captive to their senior management.

Since the publication of the OECD recommendations on Base Erosion and Profit Shifting (BEPS) in October 2015, more than 100 countries and jurisdictions have been collaborating to implement the 15 BEPS actions. The guiding principle of the BEPS initiative is to ensure “that profits are taxed where economic activities generating the profits are performed and where value is created”.

For risk managers, captive insurance is not a tax issue but an efficient risk management tool, especially for large corporations,” says FERMA President Jo Willaert.

Focus on captives is also coming from new European Union initiatives. In January 2016, the European Commission released an Anti-Tax Avoidance Package, now being discussed by the Council. A Public Tax Transparency proposal followed on 12 April 2016, extending country-by-county reporting to all large corporations operating in the EU.

Figures in context

Country-by-country financial and tax transparency are raising concerns for the captive industry. If made public, country-by-country financial and tax disclosure would give access to a large amount of highly technical information. A meaningful reading and interpretation of this information require a detailed understanding of the value chain in a group; many factors contribute to the creation of value and income in a multinational.

Tax authorities are competent to perform this analysis because of their expertise and training, but the same does not necessarily apply to members of the public. Risks of misunderstanding and misinterpretation, therefore, will be significant, forcing organisations to defend and justify their financial structures not only to tax authorities, but to less informed third parties.

With nearly 7,000 captives worldwide, the risk management community is well aware of the reasons and benefits of captive insurance, which is used by non-profits and public organisations as well as corporations,” says Jo Willaert. “These are light structures which perform a genuine (re)insurance activity. They help us to maintain affordable and wide risk coverage, access to reinsurance markets and greater risk insight.


Brexit – continuing uncertainty

brexit-blog

Image Source: The Castle Report

FERMA is closely monitoring developments at European level following the vote by the United Kingdom to leave the European Union so that we can keep our members informed.

FERMA President Jo Willaert said: “This is a major political event with considerable consequences for the UK and for the EU. UK’s decision opens up a period of uncertainty, which will impact companies until the negotiations of the exit terms are set. Risk managers have an important role to play to help companies navigate in this new environment and with their risk management expertise, support the implementation of appropriate measures until a new relationship between the UK and the EU is established.”

Airmic has published a guide to Brexit for members, which is available for free: https://www.airmic.com/news/brexit-%E2%80%93-airmic-issues-guidance-members

For additional comment on Brexit, see the Knowledge Corner.


FERMA European Risk and Insurance Survey 2016 starts Friday in 21 European countries

Download this Press Release

On Friday 8 April, the Federation of European Risk Management Associations (FERMA) will launch its 2016 European Risk and Insurance Survey in cooperation with its member associations in 21 countries. The survey is the widest expression of the views of risk and insurance managers across Europe. It has taken place every other year since 2002 and is now in its eighth edition.

The online questionnaire is available in seven languages: English, French, German, Italian, Polish Spanish and Turkish. As before, an independent research company will collect the responses and compile the findings. The results will be published as the FERMA European Risk and Insurance Report at the FERMA Seminar on 3-4 October in Malta. The report will then form the basis of further research by FERMA and its member associations, as well as providing benchmarks for individual risk managers to use in their own work.

FERMA Vice-President Cristina Martinez, who is the Survey project chairman said: “The survey is conducted by risk managers for risk managers. It is now in its eighth edition. This means we can see how we have developed as a profession since the first edition in 2002 and where we are today. There is no other source of information like this.”

The Survey questions have been compiled with support from the member associations and five commercial partners: AIG, Chubb, EY, Marsh and XL Catlin. There are three sections covering: the respondent’s organisation, the role of the risk manager and the risk management profession; European insights on risk management and risk financing, including insurance and captives.

Press contacts

Until 11 April

Laëtitia Fung, FERMA Project Officer
administration@ferma.eu
+32 2 761 94 35

After 11 April

Lee Coppack, FERMA media coordinator
lee@coppack.co.uk
+44 (0) 208 318 0330/+44 (0) 7843 089904

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About FERMA

The Federation of European Risk Management Associations (FERMA) brings together 23 national risk management associations in 21 European countries. FERMA has more than 4700 individual members representing a wide range of business sectors from major industrial and commercial companies to financial institutions and local government bodies. These members play a crucial role for their organisations with respect to the management and treatment of complex risks and insurance issues.

Member associations are from the following countries: Belgium (BELRIM), Bulgaria (BRIMA), Czech Republic (ASPAR CZ), Denmark (DARIM), Finland (FinnRiMa), France (AMRAE), Germany (DVS/BfV), Italy (ANRA), Luxembourg (ALRiM), Malta (MARM), Netherlands (NARIM), Norway (NORIMA), Poland (POLRISK), Portugal (APOGERIS), Russia (RusRisk), Slovenia (Sl.RISK), Spain (AGERS and IGREA), Sweden (SWERMA), Switzerland (SIRM), Turkey (ERMA) and United Kingdom (Airmic).


Interview with Anna Korbut on Risk Committee

Interview with Anna Korbut, FERMA Board member and executive risk manager for NefteTransService, a railway cargo operator in Russia. Continue reading


It’s not just about insurance: an actuary’s view on risk

We’ve all heard the jokes about actuaries. My personal favourite is this: “How can you tell an extraverted actuary? – he’s the one that looks at your shoes when he’s speaking to you!”, and we all know that the “average” actuary works in an insurance company. However, these stereotypes are fast becoming a thing of the past. The modern actuary is increasingly looking “outside of the box,” and it is becoming common that they are embedded in wider risk management in corporate businesses.

Actuaries love nothing better than to turn a complex problem into a model using their mathematical skills. A risk model is a mathematical representation of a system or process, based on probability distributions of the underlying risk drivers. For example, this may be a model of an uncertain supply chain, operational cash-flow, or any business process. Historical data, as well as the views of risk experts are used to parameterise the model and the risk distributions. Continue reading