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OCR for page 14
14 How Frequently Do Airport Operators Perform Risk Of the small airport operators that do conduct risk assess- Analysis? ments, all evaluate contracts, records, documents, and loss histories. Most conduct personal inspections. Some also use The majority of airport operator respondents indicated that benchmarking and statistical analysis to assess the perfor- they "usually" or "always" conduct specific risk analysis to mance of risk management strategies and their overall insur- validate insurance-purchasing decisions. Some responded ance program. that whether or not an analysis is performed depends on the type of coverage; one respondent stated that his or her facil- Based on survey responses, there appears to be no ity never performs risk assessments. marked difference in the methods used by the three airport size classifications to perform risk analysis; however, small Large airport operators reported that they "always" per- airport operators responded that they rely less on methods form risk assessments. For medium airport operators, risk such as benchmarking and statistical analysis than do the analysis is less certain. Two of six medium airport operator larger facilities. respondents indicated that their facility "always" performs risk analysis to validate purchasing decisions. Another two Who Performs Risk Analysis? operators indicated that their facilities "usually" perform risk analysis to validate these decisions, and the remaining Risk managers, risk analysts, safety officers, and insur- two respondents stated that the performance of risk analysis ance brokers are the person(s) responsible for risk analysis. depends on the line of coverage purchased. Some airport operators also named independent risk con- sultants and/or other internal personnel as responsible for Small airport operators responded with a variety of this function. answers when questioned about the frequency of risk assess- ment at their airports. Four of seven small operators claimed All large airport operator respondents stated that risk that they "always" conduct risk analysis. The remaining managers or risk analysts within their organization perform airport operators were split. One indicated periodic perfor- risk assessments. Three of six of these respondents also use mance of risk analysis. One operator stated that the analy- insurance brokers and safety officers within the organization sis is dependent on the line of coverage. One small facility to aid in assessments. admitted that it does not perform risk assessments at all. Again, all medium airport operator respondents stated In summation, the survey instrument reveals that medium that the risk manager within the organization runs the and large airport operators tend to rely on risk analysis to analysis. Some solicit assistance from safety and insurance validate insurance-purchasing decisions. In contrast, small broker personnel. airport operators rely less on this approach, likely because on the whole they are without the dedicated personnel, mon- Of the small airport operators that conduct risk assess- etary resources, and the knowledge base necessary to con- ments, a majority of small respondents rely on safety officers; duct these tasks. half use risk managers, broker personnel, and independent risk consultants to perform analysis for their facility. What Methods of Risk Analysis Are Used? Smaller airport operators tend to rely on safety officers Of the airport operators that conduct risk analyses, most use to conduct risk assessments, as they do not employ dedi- not one but a variety of methods, including the evaluation of cated airport risk managers and the risk management func- contracts, records, and documents; benchmarking; and sta- tion tends to be part time. In contrast, medium and large tistical analysis. All airport operators conducting risk analy- airport operators use dedicated risk managers and/or staff sis evaluate loss histories in performance of this task. and rely less on safety officers and insurance brokers to con- duct the analysis to evaluate insurance-purchasing decisions Large facility respondents use personal inspections of and determine the quality of the coverage purchased and its their facilities and analyze loss histories using benchmark- attendant services. ing; statistical analysis; and review of contracts, documents, and records. Half of these large airport operators use risk assessment questionnaires, and one uses personal interviews PRIORITY OF EXPOSURES and staff discussions to evaluate purchasing decisions. In order of importance, areas of exposure concerning the As a group, medium airport operators evaluate contracts, survey respondents include general liability, construction, records, and documents; use benchmarking; and evaluate and business interruption. Although these three areas are the loss histories. Some conduct personal inspections and risk top concerns among airport operators, other loss exposures, assessment questionnaires. namely automobile liability, environmental concerns, war