Risk engineer insights: Navigating commercial property risks in 2024
Scott Ewing of AXA XL Risk Consulting discusses modern loss prevention measures for commercial properties.
Risk engineers are the backbone of risk management. Their risk reduction and loss prevention evaluations and expertise help commercial property owners make informed decisions and fortify their buildings and facilities.
PropertyCasualty360.com talked with Scott Ewing, Head of Americas at AXA XL Risk Consulting, about the role of risk engineering in lowering a property’s propensity for damage in any event, from a water leak to a wildfire. Ewing has over 35 years of experience in the risk engineering and insurance industry and leads a team of risk engineers in the U.S., Canada, Puerto Rico, and Latin America.
PC360: What are the most common commercial property risks in 2024? How are risk engineers approaching these risks?
Scott Ewing: Natural disasters (such as floods, hurricanes, and wildfires), supply chain disruptions, and business interruption. Fires and water damage events are also common. Risk engineers are … using new technology and data analysis to assess vulnerabilities and develop comprehensive risk management strategies. For natural disasters, they may use sophisticated modeling and mapping techniques to identify high-risk areas and recommend protective measures, such as infrastructure improvements, early warning systems, or even guidance on storage practices that could help avoid flood damage.
Risk engineers collaborate with supply chain experts to identify potential disruptions and develop contingency plans to mitigate the impact. Their proactive approach helps businesses better understand and prepare for the evolving landscape of commercial property risks.
PC360: How does the rise in catastrophe frequency and severity impact risk analyses? In what ways can property owners and insurers mitigate these risks?
Scott Ewing: [It requires] a more comprehensive and forward-thinking approach … First, they can invest in resilient building designs and construction materials to withstand severe weather events. They can also implement robust disaster preparedness plans and secure adequate insurance coverage to mitigate financial losses. Additionally, using advanced risk modeling and data analytics, such as predictive analytics and scenario planning, can help anticipate and prepare for potential catastrophes. Collaboration with risk engineers can provide valuable insights and guidance in mitigating these increased risks.
PC360: What is your standard advice for property owners needing to satisfy insurance policy requirements when it comes to risk mitigation?
Scott Ewing: Engage in proactive risk management practices. This includes conducting regular risk assessments, implementing recommended risk reduction measures, and maintaining detailed records of all risk mitigation efforts. It’s also important to stay informed about industry best practices and regulatory requirements related to risk management … By demonstrating a commitment to proactive risk mitigation, property owners may enhance their insurability and potentially secure more favorable insurance terms.
PC360: How can risk engineer evaluations benefit insurers covering hard markets?
Scott Ewing: Risk engineers can identify potential hazards, vulnerabilities, and risk management deficiencies, allowing insurers to make more informed underwriting decisions. A comprehensive understanding of the risks involved helps insurers accurately price their policies and allocate resources effectively. Risk engineer evaluations can assist insurers in developing tailored risk improvement plans for their clients, ultimately leading to a more sustainable and profitable portfolio.
PC360: Are there any other details you’d like to share about risk management engineers and their role in P&C insurance?
Scott Ewing: Their contributions extend beyond risk evaluations to include the development of customized risk improvement strategies, loss prevention recommendations, and the facilitation of risk education and training for clients.
By collaborating closely with underwriters, claims professionals, and insureds, risk engineers help ensure that insurance coverage accurately reflects the risk landscape and that appropriate risk mitigation measures are in place. Their insights and recommendations not only enhance the insurability of properties and businesses but also contribute to the overall resilience and safety of insured assets.
The impact of risk engineering extends beyond the policy. We play a role in preserving employment opportunities by protecting corporate assets and thus by extension, jobs which in turn, impacts families and the communities in which they live and work.
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