Beyond Insurance

The Certified Risk Architect

The new breed of insurance agent & broker

By Scott Addis

The Certified Risk Architect®, or CRA, is a new breed of insurance agent/broker—consultative, diagnostic, results-oriented and focused on managing and mitigating risks rather than selling insurance. This new designation indicates that a CRA is viewed as a trusted business advisor, not as a vendor of product. The CRA’s disciplined approach, planning process and service standards differ significantly from those of a traditional insurance agent or broker.

A Certified Risk Architect is trained to begin each engagement with a blueprint focused on the identification, evaluation, and measurement of risk—a complete enterprise, diagnostic risk management checkup. The CRA uses an audit process to develop a clear understanding of a client’s operations, exposures and risk profile.

While the short-term objective is to evaluate risk, the long-term goal is to design and build programs to positively impact an organization’s bottom line through the strategic elimination, reduction and/or shifting of risk.

To fully appreciate the Certified Risk Architect, we must begin with an analysis of the traditional insurance agent and the pitfalls of his or her approach to business development and client service.

The problem: commoditization

The consumer often views insurance agents and brokers as in a real hurry to sell a policy, so that for the broker anything that comes between the initial meeting and closing the deal is viewed as an annoyance. Evaluating risk and educating the consumer is not their top priority. Their job is to sell insurance. This short-sighted strategy is contributing to a major problem for agents, their agency and the industry—commoditization.

Commoditization occurs when the consumer perceives little or no distinguishable difference between products, services and resources. When this happens, price becomes the primary point of differentiation. The well-intended insurance agent and broker is caught in the Commodity and Perception Traps.

Imagine commoditization as a disease. It eats away at one’s knowledge, wisdom and professionalism—his or her professional purpose for existence—and reduces them to a number.

What makes the CRA so different?

The evolution of the Certified Risk Architect began with a research project conducted by Addis Intellectual Capital. AIC’s research determined that insurance agents and brokers have a real image problem and need a makeover—a fresh, clean look that is appealing to the consumer. AIC’s research documented that the perception of the agent or broker has deteriorated in recent years. The vast majority of agents or brokers are seen as transactional, not consultative or diagnostic.

The CRA professional designation consists of a 12-month program to train and certify select industry professionals in the Beyond Insurance® process.

The learning objectives of the designation program include:

• Understanding one’s natural approach to creative problem solving

• Expanding one’s understanding of HR, safety and risk management issues

• Learning the art of exposure identification and risk mitigation

• Demonstrating a proficiency in researching a business and its industry

• Understanding the importance of strategic planning

• Learning how to avoid the commodity, perception and anxiety traps

• Appreciating the importance of a consultative and diagnostic client acquisition process

• Demonstrating methods to improve an organization’s risk profile

• Utilizing the CRA enterprise risk management process to gain “carrier leverage”

• Understanding the importance of giving back to one’s community and industry

A 12-member faculty supports a curriculum that combines Web-based training, classroom instruction and application in real-world conditions. Each phase of the CRA Learning Plan is practical and hands on, not theoretical. The candidates are taught how to navigate Risk Rover 365™—the CRA Knowledge Center (consisting of a risk management and human resources library containing the latest news, white papers and resource tools).

The CRA Certification Board (consisting of “industry legends”) tracks each candidate’s progress with special focus on his or her ability to master the Art of Exposure Identification and Risk Mitigation—essential ingredients to gain Trusted Advisor status. Continuing education consists of an annual retreat through which participants share experiences related to innovation, leadership and education.

Continuing education is taken quite seriously. Each year, the CRA is required to submit a work product giving evidence of strategies, systems, tools and/or scripts used to consult, diagnose and treat risks. The Certified Risk Architect is also encouraged to give back to the industry and community. On behalf of the CRA Class of 2010, AIC made a gift to InVest—a 501(c)(3) whose mission is to improve insurance literacy of high school students and attract new talent to the insurance industry.

Through the eyes of the underwriter and consumer

The Certified Risk Architect’s diagnostic assessment process is taken seriously by the underwriting community. Because CRAs are improving their clients’ Risk Profiles (thereby reducing claim frequency and severity), they are able to negotiate exceptional insurance programs for their clientele. The Certified Risk Architect’s comprehensive risk strategy embodies the concepts of intimacy, intensity and integrity. The process greatly clarifies risk acceptance and pricing decisions and allows more flexibility in program design.

Consumers are ecstatic about the innovative strategies of the Certified Risk Architect. For years, consumers have wanted their agents or brokers to “think outside the box” to earn trusted advisor status. The Certified Risk Architect’s passion to learn the business and its industry through a structured, consultative and diagnostic process allows the consumer to clearly differentiate the CRA from the traditional insurance agent or broker. The process benefits the consumer in terms of lower premiums, better safety records, enhanced HR practices, improvement in employee morale, absenteeism and productivity. The Certified Risk Architect designs and builds foundations to positively impact organizations’ bottom lines.

The author
Scott Addis is the president and CEO of The Addis Group and Addis Intellectual Capital, LLC (AIC). AIC is a coaching and consulting company whose purpose is to transform the process that insurance agents, brokers, and carriers use when working with their clients. Scott is recognized as an industry leader, having been named Inc. Magazine’s “Entrepreneur of the Year” as well as one of the “25 Most Innovative Agents in America” by The National Alliance. To learn more about the Certified Risk Architect designation, please contact Scott Addis at (610) 945-1019 or saddis@theaddisgroup.com.