Risk management in China is undergoing considerable development

Global Loss Control was formed in 2017 and operates in the region of Shanghai and the surrounding area with six consultants and engineers. The consultancy firm works mainly for European and American companies in China and for local insurance firms. “Insurance firms usually call on us for advice precisely because of our experience with international companies. We also offer advantages for international companies, in particular because of our knowledge of and experience with local laws and regulations and the way in which insurance firms work. For instance, we provide asset risk management reports for insurance firms and we advise companies on safe operation and on meeting the demands and requirements of government authorities and insurance firms. We are hands on and we have a lot of theoretical knowledge and practical experience”.

A lot of work to be done

It is clear that there is also a lot of work to be done in the heavily industrialised regions of China. Danfer Gao recalls major disasters, such as the disaster six years ago in the coastal town of Tianjin (near Beijing) that led to hundreds of casualties. “There have been major accidents more recently too, particularly at chemicals companies, and have led to the authorities giving greater attention to safety than in the past. However, not only large chemicals groups, but also medium-sized companies feel the pressure from government authorities and insurance firms to work more safely”, said Gao, who has many clients in the chemicals and technology industries.

“Government authorities usually issue new rules after accidents, but many companies are not always aware of these, or they are unable to see how they can comply with these so that they can continue their business. As risk consultants, we can really provide them with effective help”.

New partner in China

It soon became apparent in our conversation with Danfer Gao why he is very welcome as Riskonet’s new partner in China – he speaks the international language of experienced risk management professionals. “We work as consultants and advisers for both international companies that are established in China and insurance firms in the Chinese market. We know the local situation and the laws and we apply this knowledge to create bridges between both parties”.

“Companies need to be aware of the risks they face and the requirements placed by government authorities, as well as what they can or should do in order to comply with these. We also like to raise organisations’ awareness of the need for measures, not only to reduce actual risks and prevent or limit damage. It is also important that there is a dialogue between companies and insurance firms about risks, potential damage and cover. There are also possibilities for insurance firms to make good contacts with organisations to reach a consensus about demands and requirements. A true dialogue about risk and damage limitation is much more profitable for both parties than the black and white positions of both sides with hard demands”.