Risk Management Strategies: Closing the Books on 2024
Risk Managers have an opportunity to set their departments up for success in the new year as 2024 comes to a close. Now.
From budget reviews to insurance assessments, these six proven strategies provide a framework for success in 2025.
Use this checklist to finish this year strong and help your team maximize growth in the future.
Risk Management Strategies for Closing the Year-End Books:
Budget Reconciliation
Review of Losses and Claims Trends
Insurance Program Effectiveness
Strengthening Risk Partnerships
Anticipating Organizational Changes
Professional Risk Management Development
No. 1: Budget Reconciliation
Ensuring accurate financial oversight is essential as the year ends. Reviewing and comparing the department’s actual spend against the budget for 2024 helps identify any variances,
unanticipated expenses, or unused funds that could impact next year’s planning.
This analysis enables risk managers to make strategic adjustments for the ‘25 budget. This improves alignment with departmental needs and creates a financial foundation for success.
How To:
Compare actual expenses against the 2024 budget to identify areas of over- or underspending.
Identify remaining funds or unexpected expenses and assess the likelihood of recurring costs.
Use these insights to refine budgeting strategies for the upcoming year, ensuring the budget meets anticipated and evolving needs.
No. 2: Review Losses and Claims Trends
Analyzing losses and claims data trends gives risk managers a clear view of past incidents, helping manage costs and guiding future loss control strategies. By identifying patterns—such as frequent claims in specific areas or lines of business—teams can proactively address risks and optimize their resources for more significant impact. This strategic risk management approach helps align with organizational goals.
How To:
Review all claims data for 2024 to identify which exposures drove claim frequency and severity.
Assess claim patterns data to determine their cause.
Collaborate with your team to adjust policies or implement loss control measures to minimize future high frequency or severity incidents.
No. 3: Insurance Program Effectiveness
Evaluating your insurance program’s performance is essential to ensure coverage aligns with your organization’s current and anticipated needs. An assessment helps risk managers pinpoint any coverage gaps. It also helps uncover underperforming policies and adjust to recent market changes, such as inflation-driven property value increases.
Optimizing the insurance program reduces risk exposure and prepares the department for upcoming policy renewals.
How To:
Review the performance of all current insurance policies to evaluate if each met your risk transfer goals. Identify areas where the program underperformed or where claims were not covered.
Assess coverage gaps or shortfalls that may expose the organization to financial risks. Note any denied claims and investigate the underlying cause.
Consult with advisors, brokers, carriers to adjust policy limits, deductibles. Be incredibly attentive to market changes, such as inflation affecting property values and recent industry litigation impacting your firm, and adjust policy limits accordingly to avoid potential gaps in coverage.
No. 4: Strengthen Risk Partnerships
Building solid relationships with advisors, brokers, and carriers enhances collaboration, service levels, and support for your risk management goals.
Year-end is the time to evaluate these partnerships. Review the effectiveness of your partner channel and identify areas for improvement. Strengthening these connections can ensure your strategic risk management program aligns with current needs and future objectives.
How To:
Conduct a Review with Key Partners: Meet with advisors, brokers, and carriers to discuss their performance. Address any coverage or service issues to agree on areas for enhancement. This is a chance to realign priorities and expectations, creating a solid foundation for future collaboration.
Hold Year-End Stewardship Meetings: Use these meetings to review the past year’s achievements and challenges with your partners. This structured dialogue can help set mutual goals for the next year and foster a supportive partnership.
Assess Vendor Fit: Determine if your current partnerships meet organizational needs. If any gaps in service or support are evident, consider exploring additional or alternative vendors to enhance your team’s resources and capabilities moving into 2025.
No. 5: Anticipating Organizational Changes
Aligning risk management strategies with upcoming business changes is essential for a smooth start to 2025. Operational shifts, such as acquisitions, divestitures, or new product launches, can introduce new risks. Preparing for these changes allows risk managers to adjust practices, policies, and resources as the organization evolves.
How To:
Engage with Business Leaders: Meet with executives to discuss planned changes for 2025, such as expansions, divestitures, or shifts in the supply chain. Early alignment allows risk management to support these initiatives from the start.
Identify New Exposures: Assess any new risks these changes may bring, like increased liability from new products or expanded coverage needs.
Adjust Policies and Coverage: Coordinate with brokers to update policy limits, add coverage as needed, and adjust risk transfer mechanisms to match the organization’s growth and risk profile.
No. 6: Risk Management Professional Development
Investing in professional development ensures that your team has the latest skills and knowledge to handle emerging risks. As business needs change, upgrading team capabilities enhances the department’s effectiveness and prepares it for future challenges. Setting aside time and budget for skill upgrades is key to building a resilient, adaptable team.
How To:
Assess Skill Levels and Identify Gaps: Evaluate each team member's current expertise and identify any gaps in skills that could impact the department’s ability to manage evolving risk management challenges.
Allocate Budget and Time for Training: Set aside resources for certifications, courses, or conferences that align with the team’s goals and areas for improvement.
Encourage Continued Learning: Support team members in pursuing relevant designations or professional development opportunities, building a robust skill set to drive the department’s success in 2025.
This focus on professional development strengthens the department’s capabilities, helping to address emerging risks confidently.
Key Takeaways for Year-End Risk Management
Reviewing budget and spend helps refine financial strategies for 2025
Loss and claims analysis identifies areas for cost-saving and targeted risk prevention
Insurance review ensures coverage is aligned with current and projected needs
Strengthening partnerships enhances service and risk response
Planning for business changes and skill development prepares the department for evolving challenges in 2025
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