Volunteer - ORIMS · 2017. 6. 26. · THE HEARTBEAT OF RISK MANAGEMENT OCTOBER 2015 Page 3 TO PROMOTE AND ADVANCE EXCELLENCE IN RISK MANAGEMENT T he Ontario Chapter (ORIMS) of the

President’s Message

1President’s Message

2Will I have to Tip the Drone ...

3RIMS Canada Conference:Toronto: 2017...

4Executive Officers Are Employees

5Bill McGannon - In Memorium

6From Davos toMain St. ...

8ORIMS ProfessionalDevelopmentWorkshop

9RIMS CanadaConference2015 Highlights ...

INSIDETHISISSUE

ter. is year one of the Board’s strategicgoals is to enhance and demonstrate membership value. It is a great time to become or continue to be a member ofRIMS/ORIMS. We are working hardthis year to provide top value for yourmembership dollars. In the event that youare a new CRM graduate, new to the in-dustry or not sure what RIMS/ORIMS is all about we invite you to try out ourORIMS only membership as a trial ($150 annually). While it does not giveyou all the membership benefits of a fullRIMS/ORIMS membership it will intro-duce you to our local Chapter benefits and events including Chapter Communi-cations such as the award winning Pulsenewsletter. If you have any questionsabout membership, please feel free tocontact ORIMS’ membership DirectorGlenn Morato ([email protected]).

ORIMS provides tremendous value torisk and insurance professionals such asfirst opportunity to attend networking andsocial events, ORIMS’ job bank, access torisk management tools and resources, andthe Pulse newsletter, so it is money wellspent! ORIMS is always open to contribu-

H ello to all ORIMS members.On behalf of the ORIMSBoard we hope you all had an

enjoyable summer with some rest and re-laxation. For those of you who were able toattend the RIMS Canada Conference inQuebec City, we hope you took advantageof the top quality educational programwhich was offered, and of course, the socialevents. (We’ve included some photoswhich I’m sure everyone will enjoy). Hopefully you were also able to do a littlesightseeing while you were there as well.

Now that fall is here everyone is back inwork mode, including your ORIMS Board.e Board held its annual Blue Skymeeting back in July and brainstormedsome excellent ideas to help enhance andimprove ORIMS’ value. We have many exciting new initiatives that will be an-nounced in the coming months. As always,the ORIMS Board is excited to announceour upcoming slate of Professional Devel-opment sessions along with our ever popu-lar social and networking events. ORIMSis pleased to announce that its first Profes-sional Development session will be held on Wednesday, November 25th at the

By: Paul Provis, ORIMS President - Senior Risk Management Officer, Ontario Ministryof Government & Consumer Services

tions and input for the Pulse. If you are interested in advertisement or sponsorshipopportunities, or would like to contributean article, please contact Colleen Bryan([email protected]), ORIMSCommunications Director. It is a great wayto raise the profile of your company.

ORIMS is also always looking for volunteers to help with our committees.We are planning an aggressive member-ship drive for this coming year so if youhave some experience with membershipand would like to be involved then wewould appreciate your help. Please feel free to contact me with any questions youmight have. Lastly, I encourage all ourmembers to quite simply, “come on out!”.We would love to see as many people aspossible for our upcoming ProfessionalDevelopment Sessions and our networkingevents, such as the Christmas Luncheonon December 10th, our Curling Bonspielon February 29th and our 2nd annual SpringFling in May. I hope to see you all outthere supporting your local RIMS chapter.

Sincerely,Paul ProvisORIMS President

http://ontario.rims.org

THE HEARTBEAT OF RISK MANAGEMENT, OCTOBER 2015

ONTARIO RISK AND INSURANCEMANAGEMENT SOCIETY

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McCague Borlack offices at 130 King St.W. Highlights of this exciting workshopcan be found in this edition of the Pulse.More details will be provided as we getcloser to the date.

I would also like to take this opportu-nity to reiterate the importance of gettinginvolved in your local chapter. ere areseveral types of membership available including Corporate, Associate and Student memberships. Membership ispaid through RIMS Head Office in NewYork and includes value from both the“parent” organization and our local Chap-

Volunteer

THE HEARTBEAT OF RISK MANAGEMENT MARCH 2014 Page 2OCTOBER 2015 Page 2

TO PROMOTE AND ADVANCE EXCELLENCE IN RISK MANAGEMENT

Media and entertainment: Reportersare increasingly using drones to capturefootage during sporting and other mediaevents. Journalists, photographers and evenfilm staff are increasingly leveraging smalldrones to shoot videos and photos.

Insurance: Commercial, surety andpersonal lines insurers that cover propertyrisks will likely begin to use drone technol-ogy. It is not difficult to imagine a propertyadjuster or risk engineer using a UAV tocapture details of a building or location, to support claims handling or risk assess-ments. Drones can be used to enable afaster and more effective resolution ofclaims following a natural catastrophe.Claims adjusters will no longer need towait until the roads are cleared and hotelsand airports are reopened to assist theirpolicyholders. Instead, they will be able to send in the drones to assess the extentof damage.

According to Clark Luby, Senior VicePresident, Head Sales Canada for SwissRe Corporate Solutions, drones are one ofthe leading emerging technologies gettingthe most attention. “We’ve been getting alot of requests for information around the topic of drones over the past severalmonths and have provided thought lead-ership workshops in both Toronto andVancouver on the subject. When you seeyour neighbour flying one in his backyard,you can’t help but think: what are the risks?”

As with any new technology, there arechallenging issues such as safety, nationalsecurity, and personal privacy. However,such obstacles are not insurmountable and,in the words of Leonardo da Vinci, “onceyou have tasted flight, you will forever walkthe earth with your eyes turned skyward,for there you have been, and there you willalways long to return.”

Kate Browne is an attorney with SwissRe Corporate Solutions, where she is SeniorVice President and Claims Counsel. Kate is a member of TIDA, the FDCC,and the DRI and the author of severalwhite papers on topics such as punitivedamages, personal jurisdiction over foreignmanufacturers, the impact of bankruptcyon insurance coverage, self-driving carsand commercial drones.

Many Canadian companies are alreadyusing drone technology to transform theirbusiness.

Agriculture and crop management:UAVs with advanced sensors and imagingcapabilities can provide farmers with newways to increase yields and reduce cropdamage. Observing crops from the air canreveal irrigation problems, soil variationsand pest or fungal infestations that cannotbe seen at ground level. In the Okanaganand Niagara regions, farmers use dronesequipped with infrared sensors to monitorthe water, sugar and chlorophyll content ofgrapes from the sky rather than pickingsamples in the field.

Oil and gas: Companies are using dronesto inspect flare stacks, pipelines, tailingponds and onshore and offshore derricks.Ground Truth Exploration is using dronesfor aerial surveillance as it looks for goldin the Yukon, and companies such as Enbridge and TransCanada are usingUAVs to monitor their pipelines for leaksand fractures.

Consumer product delivery: In December 2014, Transport Canada issuedan SFOC valid for one year to Amazon,allowing the company to operate a testingfacility in a rural area in B.C. for its PrimeAir project. e goal is to eventually usedrones to deliver packages to customerswithin 30 minutes of the order beingplaced, as long as the delivery address iswithin 16 kilometres (10 miles) from adistribution centre.

Search and rescue: Aeryon Labs, aWaterloo, Ontario-based company, manu-factures small drones which fit into a backpack or the trunk of a police car. e Ontario Provincial Police use these dronesto survey fatal accidents, and CoquitlamSearch and Rescue in B.C. has proposed apilot program to use drones to help lawenforcement find people lost in the area’smany forests. After last spring’s 7.8 earth-quake in Nepal, Global Medic, a Canadianhumanitarian relief organization, used fourdrones that can fly as high as 13,000 feetto survey the damage and pinpoint rescueoperations.

WILL I HAVE TO TIP THE DRONEWHEN IT DELIVERS MY PIZZA?

F rom the Greek legend of Icarus toLeonardo da Vinci’s “flying ma-chine” and the Wright Brother’s at

Kitty Hawk, people have dreamed of fly-ing, but today, we have aircrafts whichhave been deliberately designed to flywithout any people on board. ese so-phisticated, unmanned aerial vehicles arecommonly known as “drones”. For a frac-tion of the cost of an airplane or helicopter,drones can soar past traffic jams to makeurgent deliveries or fly through treacheroussituations and dangerous places withoutrisking human life to provide a “real-time,birds-eye” view of large areas.

Canada is widely recognized as beingone of the world’s most drone friendly nations, and Transport Canada has beenissuing operating permits, known as Special Flight Operation Certificates(SFOCs), for commercial drones since2007. As a result, risk managers and otherinsurance professionals may soon need tohave a basic understanding of how dronesare used and the challenges that can arisefrom operating them.

What is a drone? A drone is an aircraftthat flies without a pilot on board. It canbe a model aircraft bought at a hobbyshop, a mini-helicopter used by an engi-neering firm or a fighter jet remotely sentinto a war zone. Drones are also known as Unmanned Air Vehicles (UAVs) or Remote Piloted Aircraft Systems (RPAS).

How big will they be? e Associationfor Unmanned Vehicle Systems Inter -national predicts that within ten years(from 2015 to 2025) commercial droneswill create approximately 100,000 newjobs and around USD 82 billion in eco-nomic activity.

What can drones do?e potential useof drones is limited only by imagination.Unlike planes, UAVs can be deployed ondemand and can stay in the air longer thanmanned aircraft. Drones can carry high-resolution imagery equipment and sensors,which can quickly and easily capture im-ages and videos. UAVs perform well underchallenging conditions such as bad weather— which can significantly reduce the riskof injury to humans and enable organiza-tions and people to share and analyse infor-mation in real time, thus allowing us tomake faster and more educated decisions.

By: Kate Browne, Attorney, Swiss Re Corporate Solutions

OCTOBER 2015 Page 3THE HEARTBEAT OF RISK MANAGEMENT


T he Ontario Chapter (ORIMS) ofthe Risk & Insurance Manage-ment Society is excited and proud

to host the 2017 RIMS Canada Conferencein Toronto on September 24-27, 2017 atthe Metro Toronto Convention Centre.Work has already begun to plan thisrenowned event.

Karin McDonald (Hydro One NetworksInc.) and April Savchuk (Yamana Gold) accepted the honour and the challenge ofmanaging an event at the largest venue anddestination to host a conference in Canada.April and Karin are not the least bit faint atheart about managing conferences. Bothhaving served as Chairs of the NationalConference Committee and multi-termPast Chapter Presidents, they can also addto their acumen their service as Co-Chairsof Industry for RIMS Canada 2008Toronto, as well as planning the ORIMS50th Anniversary Gala at the LibertyGrand in 2010.

Karin and April approach the same tasksfrom very different perspectives. Karin indi-cates that “April is a very big idea person and

really creative in approach.” Conversely,

April indicates that Karin “helps put things into

perspective and brings things down to earth…

she keeps the project on budget and on schedule.”

Paul Provis, ORIMS President furtheradds, “Karin and April have a deep knowledge

of the Conference’s mechanics and framework

and have been instrumental in incenting and

driving progressive changes in order to increase

the value of the Conference and to ensure it

remains sustainable. e results of their years

of effort will culminate in a new Conference

model for 2017.”

e first task at hand for the Co-Chairswas to appoint a Local Organizing Com-mittee (LOC).

April and Karin approached the selec-tion of their LOC very seriously. Karinnotes that “We knew right away that we would

both agree on the same people, it was just a

matter of convincing them that the work load

would be manageable given the new model.”

April and Karin could not be more proudto announce their 2017 LOC. “We have

amassed a fantastic team of Risk Managers with

enough experience in this business to really bring

significant value to the table yet still have many

more years of success to enjoy which brings us a

really fresh and open approach” comments April.

Please meet your Local OrganizingCommittee appointees for Toronto 2017:

Karin McDonald, CRM Director of Risk and Insurance Hydro One Networks Inc.

Conference Co-Chair:

Karin is responsible for the procurement andadministration of Hydro One’s insurance, lossprevention and claims management programs.She has 30 years of risk management experiencein the real estate and construction business aswell as the utility business. Hydro One Inc.,owned by the Government of Ontario, operatesthe largest electricity transmission/distributionsystem in Ontario and directly serves more 1.2million customers.

Karin has been actively been involved withRIMS for the past 28 years. She is a Past President of both the Canadian Capital andOntario Chapters of RIMS, Past Chair of theCanadian National Conference Committeeand Co-Chaired the Industry and ExhibitCommittee for the 2008 RIMS CanadaConference. Karin is currently serving as a member of RIMS Audit Committee.

April Savchuk, CIP, CRMSenior Manager, Insurance & Risk Management Yamana Gold Inc

Conference Co-Chair:.

April joined Yamana Gold in 2014 withresponsibility for managing their insurance andrisk functions. Yamana is a Canadian-basedgold producer with significant gold production,development and exploration properties andland positions throughout the Americas includ-ing Brazil, Argentina, Chile, Mexico andCanada. April ’s career spans over 25 yearsworking on the Broker, Insurer and Insuredsides of the business in various functions includ-ing operational and enterprise risk manage-ment, compliance, claims management and distribution and marketing.

April has served two terms as President ofthe Ontario Chapter of RIMS, Co-Chair Industry of the 2008 Toronto Conference and ispresently serves as Chair of the RIMS CanadaNational Conference Committee, Secretary ofthe Board of Directors of the William H. Mc-Gannon Foundation and as a member of theRIMS Nominating Committee.

Sarah A. MikolichBA, CRMManager, Corporate InsuranceHatch Ltd., Mississauga

Program:

Sarah has managed the global insuranceprogram for Hatch, an international design &consulting engineering firm headquartered outof Mississauga, for 7 years. She began her careeras an insurance broker 18 years ago, completingher RIBO license and CAIB certification.Sarah held such positions as Insurance Analystat a financial services firm, and then asManager, Global Insurance for 6 years at aninternational life & health sciences companywhere she also contributed to an enterpriserisk management initiative.

Sarah completed her CRM in 2003 and hasbeen an active member of RIMS and ORIMSfor the last 12 years, including a 2 year term asSecretary on the ORIMS Board of Directors,and managing the registration desk at the 2008RIMS Canada Conference in Toronto. Sarah iscurrently completing her 2 year term as Edi-tor for the RIMS Canada Council Newsletter.

Melissa FerreiraBA, CRM Director – Treasury ServicesToronto Transit Commission

Secretary & Communication:

Melissa began her risk management career atSun Life Financial in the corporate risk man-agement office holding various positions through-out her 10 year tenure. In 2009, Melissa joinedthe TTC as the risk manager, responsible for theTTC’s corporate insurance program with respectto operations and the active construction agendafor transit expansion as well as the operation ofthe TTC Insurance Company Limited, a provin-cially licensed insurance company that providesautomobile coverage for TTC’s fleet. In her cur-rent role, Melissa is responsible for managing theTTC’s treasury and other financial programs,including; overseeing the corporate insuranceprogram; managing all sales tax compliance andadvisory activities; and overseeing activities tocoordinate customs clearances and freight for-warding of all imports and exports.

Melissa is an active member of ORIMS andhas held various positions on the Board andwas a member of the External Affairs andCommunication Committee of the RIMSCanada Council.

Kris Ceelen, CRMRisk Manager Oxford Properties

Industry & Exhibit:

Kristopher Ceelen began his career as multi-line adjuster with the Dominion of Canada.Since receiving his CRM designation in 2002,Kris has worked in the varying roles within riskmanagement for the past 16 years and was pre-viously on the Board of Directors of ORIMS asthe Director of Education and the Webmaster.

Kris is now the Risk Manager for OxfordProperties with responsibilities for insuring over$30B in assets under management acrossCanada, US and Europe.

Carrie GreenManager, Finance & Administration Canadian Universities Reciprocal Insurance Exchange (CURIE)

Treasurer:

Carrie was involved as a Director on theORIMS Board for several years in the early2000’s and currently serves as Chair of the Com-munications and External Affairs Committee ofthe RIMS Canada Council.

One of the key changes to the 2017 Con-ference will be that RIMS will be the soleNational Event Planner managing the Con-ference. is oversight eliminates the heavyburden placed upon volunteers and allowsthe RIMS Canada Conference to benefitfrom RIMS’ marketing and conference plan-ning expertise, as well as the Society’s indus-try relationships and staff support. is newconference model has resulted in a smallerbut more strategic LOC being formed.With that said, the model is designed so thatthe Canadian look, feel and content willremain distinctly Canadian.

A kick-off LOC meeting has alreadytaken place and activity will ramp up oncethe excitement of the Quebec City Confer-ence has passed. Our sources indicate thatplans are underway to make the 2017RIMS Canada Conference a real “Commu-nity Affair” but other than that, all lips ofthis Committee appear to be firmly sealed.

Please mark your calendars for September24-27, 2017. We look forward to welcomingyou to 2017 RIMS Canada Conference, thecountry’s premier risk management and insurance event.

***

RIMS Canada Conference:Toronto 2017 Awarded to ORIMS

By: Editorial Staff

THE HEARTBEAT OF RISK MANAGEMENT OCTOBER 2015 Page 4


I nsurance brokers must be cautiouswhen dealing with corporations thatopt their executive officers out of

Ontario’s workers’ compensation scheme. A failure to appreciate the relationship be-tween statutory and private coverage risksinadvertent exposure to significant liability.

Unfortunately for one insurance broker-age, this is exactly what happened in the recent Ontario Court of Appeal decisionof Sam’s Auto Wrecking Co Ltd (WentworthMetal) v Lombard General Insurance Company of Canada.1 e unforeseen gapbetween workers’ compensation coverageand general liability insurance coverageended up costing Dalton Timmis InsuranceGroup (“Dalton Timmis”) hundreds ofthousands of dollars.

Wentworth chose to opt out its execu-tives from workers’ compensation benefits,and in the alternative, insured their man-agement team through private disabilityinsurance. Wentworth found that the dis-ability insurance was more affordable thanthe premiums for workers’ compensationbenefits. It never informed its insurers orits insurance brokerages of this decision.

Wentworth then acquired a compre-hensive business policy, which contained a $2 million commercial general liability(“CGL”) policy, through Lombard (now“Northbridge”).

In 1990, Mr. John Ferber was appointedas vice-president of Wentworth’s parentcompany. Eight years later he was involvedin a serious accident on the job, resulting insevere permanent injuries.

Mr. Ferber sued Wentworth and a co-worker for damages in negligence. Went-worth in turn third partied Lombard, aswell as Dalton Timmis and the individualbroker, George McCarter (“McCarter”).

Mr. Ferber eventually settled his actionas against Wentworth for a total of$950,000. Both Dalton Timmis andWentworth contributed to this amount,for $750,000 and $200,000 respectively,and Wentworth discontinued its actionagainst Dalton Timmis and McCarter.Wentworth and Dalton Timmis (througha counterclaim which made it a defactoplaintiff ) sought indemnification fromLombard. Lombard refused based on anexclusion in the policy.

The Gape main issue in the case was the inter-

pretation of whether an “executive officer”was considered an “employee”. is pointwas relevant because the CGL policy in-cluded the following exclusion:

is insurance does not apply to:

“Bodily injury” to an employee of theInsured arising out of and in the course ofemployment by the Insured.

Wentworth and Dalton Timmis arguedthat an executive officer was not an “em-ployee” for the purposes of the exclusion.McCarter testified that he strongly believedthat the exclusion would not exclude thepersonal injury claims of executive officers who were not covered by workers’compensation.3

eir argument was largely based on whatLaskin J.A., writing for a unanimousCourt, acknowledged was an “odd result”:4

“e exclusion takes away coveragewhere an Ontario employer might wish tohave it: for a workplace injury not coveredby workers compensation legislation.”

Despite this, the Court of Appeal rejectedthe argument that an executive officer wasnot an employee. e Court of Appealfound that the case law heavily supportedan executive officer being an employee, andthat these terms were not mutually exclusive.

As well, the Court of Appeal found thatthis type of exclusion was typical for a CGLand was commercially viable:5

“Commercial general liability coverageis intended to protect the insured againstlosses to third parties or to the public arisingout of the operation of the insured’s busi-ness... e coverage is not intended to protect the insured against losses to itsown employees from workplace injuries.”

Further, the broker admitted that whilethere is an employer’s bodily injury liability“extension” which would have broadened

Continued on page 9 ...

Executive Officers are Employees

By Anthony Gatensby, Associate Lawyer, McCague Borlack LLP

The “Gap” Between Workers’ Compensation and General Liability Policies in Executive OfficerPersonal Injury Cases

Workers’Compensation

GeneralLiability

FactsUnder Ontario’s Workplace Safety and

Insurance Act (the “WSIA”), coverage is optional for executive officers.2



Executive Officers are Employees... from page 8

the policy to cover the claims of employeeswho are outside the coverage of the WSIA,this extension was never issued.6

While the broker felt that the extensionwas unnecessary, he also testified that hehad no knowledge of Wentworth’s decisionto remove its executives from workers’compensation coverage.

e Court of Appeal ruled that Lombardcould rely upon the exclusion, such thatthe CGL policy did not provide coverageto Wentworth in the event of a personalinjury claim by an executive officer. Went-worth and the Dalton Timmis had to footthe bill of their settlement agreement withMr. Ferber.

Importanceis ruling shows that, as an insurance

broker, it is important to ensure there isadequate alternative coverage available for companies who choose to excludetheir executive officers from the workers’compensation scheme. Otherwise, asshown in this case, there can be severe financial consequences.

e broker and brokerage were un-aware of the lack of workers’ compensa-tion coverage (the settlement precludeda court-led determination of liability).While a corporation should be provid-ing all significant details, the case lawshows that insurance brokers bear a highonus to understand their clients’ businessand insurance needs. If a broker doesnot understand his or her clients’ liabili-ties, the client will not be properly insured.

To avoid the risk that arose in thiscase, brokers should ask about theirclient’s existing workers’ compensationcoverage in order to ensure that alter -native coverage in place – if any – is ad-equate. In the event that the situation isunclear, the policy is best referred tocoverage counsel for a legal opinion.

1 2013 ONCA 186, released March 28, 2013 [ONCA decision].

2 SO 1997, c 16, sch A, section 12(3).3 2011 ONSC 6441 at paras 32-34

[ONSC Decision].4 ONCA decision at para 44.5 Ibid. at para. 26.6 ONSC Decision at paras 32-34.

Bill McGannon - In Memorium

I t is with deep sadness that the fam-ily of William H. McGannonannounce his passing on August 26,

2015 after a long struggle with idiopathicpulmonary fibrosis at the age of 79 years.

Bill was born November 5, 1935 inMorrisburg, Ontario to William McGan-non and Florence Ouderkirk. He camefrom Toronto to Calgary in 1977 asCorporate Secretary for Alberta Gas TruckLine later known as Nova Corporation.Upon his retirement in 1998 as Risk Manager for Nova Chemicals, the WilliamMcGannon Foundation was set up in hishonour to award scholarships to deservinguniversity business students.

Bill is survived by his beloved wife of 52years Kathleen (nee O’Hagan); his son,

Patrick (Cynthia) of Calgary; and hisdaughters, Maureen Bennie (Ron) of Calgary and Dr. Kerry McGannon ofSudbury, ON. He is also survived by hischerished grandchildren: Marc and JuliaBennie and Sloan and Alexa McGannon.

He was predeceased by his parents, and his sister Beverly Parker.

If friends so desire, memorial donationscan be made to the Canadian PulmonaryFibrosis Foundation (47 Squire BakersLane, Markham, Ontario L3P 3G8) or at

http://www.canadianpulmonaryfibrosis.ca/get-involved/donate/.



e insurance industry continues to playcatch up with the trends and demands ofinsureds in this area, however key issuessuch as coverage for malware, denial ofservice attacks and the ability to set up realpolicy sublimits to deal with liquidateddamages and brand reputation continue toneed to be addressed. Adding to that, thedirect linkage to D&O coverage in whichthe breach of fiduciary duties (knowing andaddressing key risks) could impact thecompliance side of risk management, addingto the need of understanding and reportingon not-yet familiar concepts such as token-ization of data, separability of critical systems and Maximum Probable Loss scenarios that include regulatory fines, crisisservices, legal defense and settlement costs.

To make matters more complicated, increasingly IT platforms are relying in third-party data administrators and systems logistics located outside NorthAmerica, in countries such as the Philip-pines, India and Malaysia to name a few.Beyond the direct country risk implica-tions of those locales (including natural catastrophe resilience) there is the issue ofwhose risk it is if an attack or data breachoccurs in a supplier of IT services. Whichbrings us to our second peril...

Supply Chain Disruption –not just in my backyard...

When people think in supply chain,they normally envision a factory with rawmaterials coming in and widgets going out.However, as any risk manager worth itscredentials know, it is way more complexthan that. At the heart of it, is the conceptof contingent business interruption (CBI).Can your operation be disrupted if a keyinfrastructure or supplier was affected, sayby a cyber attack, for a couple of days, orweeks? Does your CBI coverage needphysical damage to trigger indemnity?

e role of risk managers goes beyondcontingency planning but its focus is in-

creasingly in accessing the nature of thoseexposures: who are we exposed to? (knowyour suppliers, partners) where are we exposed? (country risk, nat/cat risk) and finally do we have adequate coverage (CBIor Supply Chain Disruption) in place todeal with a potential catastrophic loss?Boards are clearly interested in knowingrisk management is aware of connectionswith suppliers and partners, not just from a reputational risk perspective, but increas-ingly because board members themselvesare nervous about potential leak of key information or the consequential damageof having to deal with crisis that initiatedbeyond the group’s own reach.

With globalization making efficient useof assets and resources among differentcountries, risk managers are increasinglyfaced with the issue of analyzing and un-derstanding the risk profiles of joint-ven-ture partners and suppliers in places andcultures that are very different from theones in Canada. If my backbone financialoperation (ie. accounts payable, receivables,cash management) happens thousands ofmiles away, what happens if there is a ma-jor natural catastrophe disruption at thesite? What if that operation is happeningnot even at my company site but a third-party provider? Can I rely on a secondarysupplier closer to home, and at what incre-mental (emergency) cost? ese questionsare increasingly asked as lower cost baseservices are provided elsewhere.

Lower cost service providers tend to beclustered where there is a minimally edu-cated workforce along with a leveraged currency cost advantage. Although thisseems a tremendous competitive advantage,it comes with an expected high level of risk,which brings us to our last risk marker...

Credit risk – to be or not tobe (credit rated), that’s the question...

With lower interest rate levels comes

the consequential increased levels of debt.is is not a phenomenon isolated toCanadian households, but one that isprevalent globally, with a few exceptionswhere interest rates are kept higher formonetary policy reasons. It is clearly earmarked that when interest rates start tomove up (and from the low levels theyhave been in North America they can onlygo up) there will be an incremental pressureon servicing debt.

Several Canadian business and organi-zations (government or quasi-government)still consider credit information a taboo:why should we acquire credit informationon our clients and/or suppliers as thisseems intrusive? e simple answer is thatcredit trend information can help businessand organizations manage their exposureswith foresight. Credit indicators typicallywork with predictor base algorithms whichallow a risk manager to look into the pos-sible (not to say probable) near future. emore elaborate answer is that with goodinterlinked credit information, risk man-agers can “see” the linkages between busi-ness and organizations beyond their own.For example, if a provincial crown corpora-tion is able to verify the business connec-tions of their key suppliers and in doingthat identifies one or two potential reputa-tional risks they are not comfortable with,it will be much easier to deal with thatproblem on the onset of the informationbeing acquired, than at a crisis mode, oncea loss has occurred. is would only bepossible because some sort of credit ratingsystem has been established prior to thatinformation being acquired and becausethe providers of such information aggre-gate several millions of interconnected datapoints. at crown corporation risk man-agement team would never be able tomake those connections based on a simpleclient/supplier questionnaire. ink of it asa third-party “note comparison” on anotherbusiness. Have we got to the same conclu-sion? Do you believe there is more riskhere than what I’ve assessed?

With interest rates eventually movingup later this year and next, it is very impor-tant that risk managers keep up a finger inthe pulse of potential risks to their opera-tions by systemic defaults in Canada andelsewhere in the globe where they mightbe unwillingly exposed.

See you next year at the Davos 2016debrief...

From Davos to Main St. - third and final part

By Daniel R. Galvao, Credit Insurance Advisory Group

I n this third and last part of the article, we will look into risks thatcould potentially be originated,

aggravated or derived from the social political variables raised in the first twoparts; namely: low oil prices, threat of rising interest rates and slow GDP growth.

It is not easy nor highly accurate to tryto predict the specificity of perils or whenthey will likely occur, especially when theyare of the operational (not financial) natureand the implicating variables are finance related. With that warning and purposelyavoiding to get in the common place ofeveryday media or industry literature, I believe cyber risk, supply chain disruptionrisk and credit risk are the three top risksthat should occupy the minds of Canadianrisk managers in the short to medium term.

Cyber risk – from hype to here

Needless to say, we have moved from arisk that could potentially happen a cou-ple of years ago, to attacks and breachescausing million of dollars in direct lossesand consequential damages. e stark reality is that, with few noble exceptions,the risk management community includ-ing the insurance groups themselves isstill trying to equip themselves withknowledge and tools to map and dealwith cyber risk, given its highly technicalnature and broad implications.

e peril goes beyond one’s internalsystems and into social media, mobile devices and its accessibility, cloud comput-ing and storage to third-party big data analytics and the internet of things-IoT(or the interconnection of systems acrossmultiple platforms). I am not savvy aboutIT security as I would like to be but reach-ing out to my network for this article, Icontacted several professional experts inthe field and one common theme appeared:except for some large financial institutionsand key federal agencies, Canadian busi-nesses and government is grossly mispre-pared for cyber attacks, be those of terroristnature (a group, or groups with a commoncause or agenda) to lone hackers and criminals looking to try to disrupt the waybusiness is done, or profit from data theftand ransom of data. From personal healthinformation to industrial data on cost ofgoods and key marketing material, the ex-posure in Canada is exponentially higher if we consider our connection to the USeconomy. It might be easier to attack orpenetrate a system in Canada to gatherintelligence or access to partners and sup-pliers south of the border.



Announcement: New Designs!

O RIMS has a new InformationBrochure which replaces theformer desk calendar. While

the format is still tri-fold, the brochurecontains information about our organiza-tion on both sides. e Information

Brochure has been distributed to ourmembers, sponsors and advertisers. If youhave not received a copy of our newbrochure, kindly contact the ORIMSCommunications Director.

e ORIMS wall calendar is also chang-ing. We are moving to a calendar year ( Jan – Dec) format for 2016 and the calen-dar will include some new items. Distribu-tion of the ORIMS wall calendar will be inDecember. Watch for it!

T he Canadian Risk Management(CRM) is a highly recognizedprofessional risk management

designation awarded by the Global RiskManagement Institute, Inc. (GRMI) and supported by the Risk and InsuranceManagement Society (RIMS). It isawarded to candidates who have com-pleted the following 3 mandatory coursesalong with the three corresponding examsas published by the GRMI:

• ARM-54 Risk ManagementPrinciples and Practices

• ARM-55 Risk Assessment andTreatment

• ARM-56 Risk Financing

e CRM program courses are providedthrough select universities and colleges.In addition, the Insurance Institute ofCanada offers an on-line CRM programthat offers 2 credits towards the CharteredInsurance Professional (CIP) designationupon completion of the CRM certification.

Notice of Change to CRM Designa-tion Requirements: GRMI has insti-tuted a new requirement to obtain theCRM designation. Effective May 15,2015, the process/requirements for thosecandidates who start the CRM course after April 2015 now requires the comple-tion and passing of a standardized finalexam for each of the 3 mandatory courses.For more information visitwww.RIMS.org/Education.

CRM DESIGNATION



ORIMS Professional Development Workshop

extra expenses, construction, physical dam-ages, contingency/entertainment claims,products liability & recall, lost profits, catastrophe services, business disputes andpersonal injury & wrongful death.

Gerry has been involved in engagementsacross a wide range of industries including,automotive, power generation, chemicalmanufacturing, film and entertainment,hotels and resorts, retail and wholesale andtransportation. Most notably, he has workedon numerous assignments pertaining to

construction claims and disputes, miningand refining and steel processing, both inCanada and around the world.

Gerry will help to demystify what occursafter a claim happens. He will help you tounderstand Business Interruption Policiesand impacts of different coverages on lossmeasurements.

Using actual claims Gerry and his fellowexperts have been involved in, he’ll discussthe language used in a typical business in-

terruption policy as well as the financialimpact different types of coverage can havewhen measuring a loss. He’ll also spendtime discussing the ever-evolving world ofcyber risk and how a forensic accountantwould navigate a claim related to thishigh-risk issue.

Be sure to watch for the registration formby email or check the ORIMS website to register for this exciting workshop. Come outand network with your colleagues and learnnew skills. Don’t miss out!

Demystifying the Claims Process – A Forensic Accountant’s Perspective

G erry Bouwman joined MDDForensic Accountants’ Torontooffice more than twenty years

ago. He is a Partner / Senior Vice Presi-dent at the firm, a member of MDD’sGlobal Executive Committee and theCanadian Director of Business Develop-ment & Marketing.

A seasoned forensic accounting profes-sional, Gerry has vast experience perform-ing economic damage quantification formatters related to business interruption,

At McCague Borlack Offices130 King St. W. Toronto9:00 am to 1:00 pm.Includes networking lunch

Save-a-date November 25, 2015

OCTOBER 2015 Page 9


THE HEARTBEAT OF RISK MANAGEMENT

2015 RIMS Canada Conference:“Panorama” Quebec CityT he 41st annual RIMS Canada

Conference was recently held inbeautiful Quebec City from

September 27th to 30th. It was a populardestination, as it was extremely well at-tended by delegates and industry partnersfrom all over Canada, United States andthe U.K. e conference kicked off on theSunday by holding the annual Gala dinneron its new day (typically held on Tuesdayas a grand finale). Attendees enjoyed anamazing dinner and entertainment by thetalented Gregory Charles. It was a resound-ing success as evidencedby over 1,000 attendeesand guests!

From Monday toWednesday, the confer-ence continued with awide variety of profes-sional development sessions, as well as, accomplished and impres-sive plenary and keynotespeakers which included David Suzuki (famous geneticist and show host), Tim East (Director, Risk Manager at Walt Disney Co.), Maurice Greenberg(CEO Starr Companies) and Louis Garneau(champion track cyclist). Some of the manyeducational topics included cyber liability,climate change, ERM, and utilizing newtechnologies to mitigate risks (e.g. drones).e conference also provided for some excellent networking and social oppor-tunities at some of Quebec City’s finestrestaurants and historical landmarks.Conference attendees were also treated tothe delights of Quebec City, known for itsmuseums, history, culture and fine dining. Quebec City celebrated its 400th anniver-sary in 2008 and it is the oldest Frenchspeaking community in North America.e famous Chateau Frontenac is said tobe the most photographed hotel in theworld! Some other interesting facts aboutQuebec City: It is the only walled citynorth of Mexico (4.6 kilometers of walls)and it is designated as a UNESCO WorldHeritage Site.


Paul ProvisPresident

Tina GardinerVice-President

Mark CosgroveTreasurer

Valerie FoxCorporate Secretary

Helen TrajanosProfessionalDevelopment

Tony RossiEducation

Colleen BryanCommunications

Glenn MoratoMembership

James EkaSocial Programs

Terry LampropoulasSocial Media

Julian ValeriPast President

Roman ParzeiBoard Advisor

2015-2016 ORIMS Board of Directors


EditorialCommittee

Managing Editor/DirectorColleen Bryan

[email protected]

Editor in ChiefPaul Provis

[email protected]

Article Co-ordinatorRiaz Juma

[email protected]

Article Co-ordinatorVic Persaud

[email protected]

PULSE is produced on behalf of ORIMS by,

PAPPLE GRAPHICS.

Editorial Policye PULSE is a publication of the

Ontario Risk and Insurance Manage-ment Society and is published period-ically throughout the calendar year.

e opinions expressed are those ofthe writers and the volunteer membersof the PULSE Editorial Committee. Articles submitted to the PULSE forpublication are subject to the approvalof the PULSE Editorial Committee. Approval of such articles is basedupon newsworthiness, and perceivedbenefit to the readership. All decisionsof the PULSE are not subject to ap-peal. Individuals submitting articlesto the PULSE hereby acknowledgetheir acceptance of the PULSE Editorial Policy.

met the criteria of having made outstandingcontributions to the field of risk manage-ment in Canada. ORIMS’ President, Paul Provis, had the privilege of present-ing the 2015 Don Stuart Award to TinoBrambilla of Manitoba Hydro, fromWinnipeg Manitoba. Tino was recognizedfor his over 35 years of accomplishmentsand service to the Insurance and RiskManagement community.

e ORIMS’ Board would like to con-gratulate the Quebec local organizingcommittee for putting on a fantastic conference and for all their hard work and dedication. As a reminder, the 2016 RIMS Canada Conference will beheld in Calgary, Alberta from September11th to the 14th. We hope you will beable to attend.

D on Stuart Award: At the RIMSCanada conference, ORIMSwas pleased to once again present

the Don Stuart Award that is bestowedannually to a member of the CanadianRisk Management community who has

Conference highlights Continued ...

Donald Stuart AwardPresentation

Tino Brambilla, 2015 Don Stuart Award winner

Maryam Morrison Photography

Documents

Volunteer - ORIMS · 2017. 6. 26. · THE HEARTBEAT OF RISK MANAGEMENT OCTOBER 2015 Page 3 TO PROMOTE AND ADVANCE EXCELLENCE IN RISK MANAGEMENT T he Ontario Chapter (ORIMS) of the