WILLIS RETAIL PRACTICE REDUCING THE COST OF RISK

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1 WILLIS RETAIL PRACTICE REDUCING THE COST OF RISK

2 REDUCING THE COST OF RISK As a retailer, you work hard to build and protect your business and the ability to deliver on your brand promises is key to the relationship between you and your customers. This is why an insurance and risk management programme designed by a broker who understands the specific needs of retailers is essential in protecting your brand, your reputation and your business. The credit crunch is impacting the UK s economic prospects. Borrowing is becoming more difficult and with energy and travel costs increasing, consumer spending power is being severely hit. As one of the UK s leading insurance broking and risk management consultants to retailers, Willis understands that cost control is paramount. Willis also appreciates that its retail clients have other specific needs and issues that require in-depth sector knowledge and expertise in order to find productive and cost-effective solutions. To fulfil these requirements, Willis has an established Retail Practice; a specialist resource focused on providing bespoke, tailored insurance and risk management solutions to retailers. At Willis we have the enthusiasm, skills and capabilities to deliver practical and innovative solutions for retailers. As an active member of the British Retail Consortium, Willis understands the needs of the retailer to drive productivity within a framework of responsible retailing. We are committed to supplying the retail sector with the insurance and risk management solutions it needs.

3 COST CONTROL SOLUTIONS In recognising the importance to retailers in controlling insurance cost Willis is best placed to achieve the optimum result, at all stages of the insurance market cycle. A successful strategy that we have developed is to position our clients as an insurer s Client of Choice. We help them to differentiate their business to insurers so that they can enjoy the most competitive premiums available, whatever the market conditions. Willis is leading the way, working with retail clients in developing strategies to help businesses positively differentiate themselves on the basis of: Proactive Risk Management Systems Robust Claim Defensibility Sound Business Continuity Planning Claims Management Key areas of risk where we can add value and reduce your costs are: Property (including reviewing Landlords insurance costs) Business interruption and logistics review to enhance your business continuity performance, maintain revenues and increase insurer competition for your risk Review of self insurance mechanisms Claims defensibility, including employment practice liability, impacting on future liability costs Absence management risk our specialist service uses innovative tools designed to reduce absence levels and the costs of your Employers Liability claims. Willis is working with retail clients in developing strategies to help businesses positively differentiate themselves.

4 CASE STUDY REDUCING THE COST OF RISK CASE STUDY A A retailer with numerous city centre department stores approached Willis to provide a full review of its insurance arrangements with a view to obtaining recommendations on programme design and ultimately to achieve cost reduction. In conducting our review we developed a full understanding of the retailer's risk and loss management policies and procedures by visiting a number of their key locations and management teams. As a result we were able to portray a detailed risk profile to the insurance market, and with our broking strengths, were able to negotiate a 40% premium saving on their total insurance programme cost. CASE STUDY B A number of our retail clients have taken up the Willis "tenant premium check" facility which seeks to achieve more equitable charges from their landlords. The facility has been successful in persuading some landlords to insure via Willis, and where they have, some retail clients have saved in excess of 50% on landlord insurance costs. And where landlords do not opt to use the Willis insurance scheme we have still been able to negotiate reduced insurance premiums with many landlords, passing these savings onto the retailer.

5 BENCHMARKING Many of our clients appreciate the confidential benchmarking exercises that Willis can undertake in the following areas: Limits of Indemnity Premium rates Level of deductibles Covers purchased Claims frequency and magnitude Examples of benchmarking graphs for comparing claims ratios: Public Liability Claims Number of Claims per 10m Turnover 0 A B C D E F It is the ability to benchmark that defines not only where the company is going but also how it is performing against its peers. 5,000 4,000 3,000 2,000 1,000 0 Public Liability Claims Average Claims Cost A B C D E F The strength of our positioning in the retail sector and portfolio of clients we hold means that our benchmarking data is an extremely powerful tool to differentiate your risk profile to the market. High average claims costs may indicate that your insurers performance needs to be audited and improved.

6 Willis Limited The Willis Building 51 Lime Street London EC3M 7DQ Tel: +44 (0) Willis Limited, Registered number: England and Wales. Registered address: 51 Lime Street, London, EC3M 7DQ. A Lloyd s Broker. Authorised and regulated by the Financial Services Authority for its general insurance mediation activities only. FP562/6147/06/08