While risk management is now a top priority at companies everywhere, it’s been the focus of the Risk and Insurance Management Society (RIMS) since 1950. Celebrating the not-for-profit’s 60th anniversary is high on Terry Fleming’s to-do list when he takes over as president on Jan. 1.
But as he travels extensively for the next year promoting RIMS’ agenda, Fleming will be keeping his day job. He’s been the director of the division of risk management of Montgomery County, Md., since 1988 and manages the county’s $100 million risk management program and its self-insured property and casualty operation.
Supporting RIMS’ lobbying for regulatory and legislative changes are among his top priorities. “On the regulatory side, the broker compensation issue has reared its ugly head,” Fleming says. Last summer, the Illinois Department of Insurance lifted the ban on Arthur J. Gallagher & Co.’s collecting contingency commissions from insurers on sales of commercial policies. That practice was effectively scuttled for large national brokers in 2005, after a New York State settlement with insurance broker Marsh & McLennan, but regional brokers continued to do it.
Meanwhile, the New York Insurance Department’s (NYID) disclosure rule on broker compensation and transparency was recently published in the state register. “We believe that once it’s enacted, the attorney general will lift the ban on the other large brokers,” Fleming explains. “There have been a lot of complaints, calling it an unfair playing field.” The proposed rule calls on brokers to tell buyers whether the brokers are representing the buyer or the insurer in the transaction and let the buyers know they can ask the broker for additional information on fees. RIMS believes the rule “should be a proactive process, that the broker should be required to disclose,” says Fleming.
RIMS would like to see contingency fees banned altogether. “It’s a conflict of interest for the broker to take money from the buyer for the transaction and also accept money from the insurer,” Fleming says, adding that “NYID is walking a fine line to get a regulation that will satisfy most people.” RIMS will be registering its concerns over the rule during the 45-day comment period.
Also on the agenda this year: Offering RIMS’ products and services to U.S. corporations operating overseas “in areas where there is a need for risk management education,” Fleming says; developing a track for RIMS graduates to enter the insurance field directly rather than having to work for a broker; and encouraging more peer-to-peer benchmarking and dialogue.
o A RIMS member since 1988 and on the board of directors since 2002.
o Likes to travel, play with his grandchildren, work out and play the guitar.