RIMS produces guide to Reservation of Rights
Written by staff reporter
Understanding, anticipating and properly responding to reservation of rights letters is integral to risk professionals’ ability to protect their organisations and realise the full value of insurance policies, according to a new RIMS report, 'A Risk Management Guide to Reservation of Rights'.
Developed by members of the US-based RIMS Standards and Practices Council, the report aims to guide risk professionals in understanding the potential implications that reservation of rights letters pose. The report explains the background of these notifications and outlines considerations when deciding if, when and how to respond. It includes examples of reservation of rights and response letters, while exploring issues regarding claim limitations, communications strategies, litigation and potential conflicts of interest.
“It may be surprising when a claim is reported, and an insurer sends the policyholder a reservation of rights letter, potentially limiting coverage,” said RIMS vice-president of Strategic Initiatives, Carol Fox. “Knowledgeable and prepared risk professionals can make all the difference in getting the full value from an organisation’s insurance policies.”
A Risk Management Guide to Reservation of Rights report is available in RIMS Risk Knowledge library at www.rims.org/riskknowledge