Overview & Responsibilities

Department Overview

Exposures to risk of loss (except business risk), which arise from external causes, shall be avoided, eliminated, minimized, transferred, or controlled whenever it is feasible to do so. To ensure the proper stewardship of University resources the risk of loss is transferred to the operating units.

The University will only purchase insurance for those exposures to risk that remain after all reasonable loss prevention measures have been pursued, and when the magnitude of the risk and the potential for loss is such that the purchasing of insurance is warranted.

Potential Loss Exposures

The primary areas of potential exposure to risk of loss are as follows:

1. Employee-work connected injuries.
2. Property-in vulnerable concentrations at specific locations and property subject to the perils of fire, lightning, windstorm, explosion, civil commotion, smoke, hail, vandalism, malicious mischief, vehicle and aircraft damage, sprinkler leakage.
3. Liability - for operation of motor vehicles; operation of premises and negligent actions or omissions on the part of Cornell employees, agents or Cornell University funded and sponsored organizations.
4. Crime - from exposures to burglary, robbery and employee dishonesty.

A program of loss and accident prevention and the maintenance of appropriate, adequate and reasonable insurance protection will provide Cornell with protection against the loss of its assets and ensure the continuity of its operations.

Technical advice and services relative to insurance and/or loss control activities are available to each operating unit and will be provided by the Department of Risk Management & Insurance alone or in conjunction with other departments.

Each department is encouraged to utilize the services of the Department of Risk Management & Insurance, but they should especially seek advice when considering plans for new or expanded facilities, leases or other contracts, acquisitions, exhibitions, security, methods of storing or shipping merchandise, substantially new or altered programs or any activity which has the potential for risk of loss to people or University assets.

Department Responsibilities

1. The insurance responsibility includes the management of property and liability insurances (exclusive only of Workers Compensation).
2. The risk management responsibility involves:
   1. planning what work must be done to protect Cornell against the adverse effects of accidental losses;
   2. organizing personnel and other resources to carry out this work;
   3. leading personnel throughout Cornell to motivate them in their responsibilities relative to risk management;
   4. controlling Cornell's risk management program and evaluating its effectiveness.
   5. coordinating the experts in the areas of safety, security, law, claims administration, and finance in addressing claims, potential claims, and litigation against the University.
   6. making decisions relative to the risks that the University encounters in its operations.

The basic decision making process of risk management is as follows:

• Identify potential human, physical, financial, and natural losses.
• Measure the effect on Cornell should a loss occur.
• Apply the indicated risk control and/or risk financing techniques.

These techniques are as follows:

Risk Control

1. Exposure avoidance
2. Loss Prevention
3. Loss Reduction
4. Segregation of Exposures
5. Contractual Transfer for Risk Control

Risk Financing

1. Current Expensing of Losses
2. Unfunded Reserve
3. Funded Reserve
4. Captive Insurer (Risk retention group)
5. Commercial Insurance
6. Contractual Transfer for Risk Financing

* Monitor results and re-evaluate.