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By CYRIL TUOHY, managing editor of Risk & Insurance®.

What risk managers don't want for Christmas, Hanukkah, Kwanzaa or whatever else they are planning to celebrate this holiday season.

-- Wanna-be market entrants. Any Johnny-come-lately can underprice his or her way into the market just to grab market share. That doesn't do risk managers any good when they need their carriers to pay the claim.

-- Broker double-talk. Either brokers accept contingent commissions, and accept them completely, or they decline them completely. Period. Accepting contingents where "legally permissible," or depending on the size of the account makes for a more complicated life for buyers.

-- Title bloat. The industry has raised this to an art form. Unfortunately, it only eats up space on letterhead and e-mail signatures. Titles are the remnant of a feudal past, and the industry's moved far beyond that ... or has it?

-- Alphabet soup. No one can understand insurance industry professional designations. Risks, meanwhile, keep getting more complex. Focus on the risks, and your career will take care of itself.

-- Mergers and acquisitions, said to be necessary because they make the marketplace more efficient, often do quite the opposite. Shareholders and senior management do well. In the end, though, life is more confusing for buyers.

-- Frothy stock markets. They encourage irresponsible behavior. The last thing we need is to egg on Wall Street to invent opaque products that no one needs, and that no one understands, Wall Street included. Market froth only encourages carriers to go out and sell insurance against the very products no one understands.

-- The astronomical cost of living in Bermuda. Even with fat expense accounts, housing allowances and discounted greens fees, the cost of living there is out of hand. Perhaps the new Premier Paula Cox can do something about it.

-- Endless disagreement over what enterprise risk management is and is not. If the industry could agree on ERM, every company would be able to manage its risks properly.

-- Third-party administrators acting as middlemen. TPAs need to manage claims or book of business on behalf of clients, not outsource the work to a subcontractor. That's like college students paying someone else to write their term papers.

(Read Senior Editor Dan Reynold's 2011 Wish List here.)

December 1, 2010

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