Beware of spectacular insurance savings
Decreasing insurance premiums offered to corporations by insurers may have resulted in huge costs savings for corporations but treasurers should be wary of such premium price decreases, since many of these offerings are done by removing the rights of the insured to settle or contest claims. The decrease in premiums was made possible by prudent underwriting which decreased loss ratios for insurers, increased investment returns and cost savings associated with consolidation, all of which increased the industry's net income from $5.8 bil in 1992 to $35.3 bil in 1997. Treasurers must continue to insist on their authority to settle or contest claims while haggling for premium price reductions so as not be caught off-guard when the business cycle of the insurance industry starts to dip.
Publication Name: Treasury & Risk Management
Pipeline inventory: the missing factor in organizational expense management
A study was conducted to examine effective organizational expense management. The approach should reflect the corporate goal and should include a pipeline inventory that is typically ignored by traditional organizational expense management systems and often leads to erratic spending patterns and inventory pile-ups. The solution is a flexible financial control mechanism emanating from an accurate knowledge of pipeline inventory.
Publication Name: National Productivity Review
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