Understanding Risk

 In Commercial Insurance


When I meet with people to discuss their insurance needs, they are often only looking for the best price.  While price is important, the cost of being improperly insured far outweighs the premium. The best way to assess each client’s risk level is doing a risk assessment.

As a Commercial Insurance Agent, my main concern is making sure my clients are properly insured.  This often kept me up at night, because I never wanted a client to have a loss that wasn’t covered.  This fear started me down the path of assessing risk.

What is a risk assessment?  It is a systematic process of evaluating the potential risks that may be involved in a projected activity or undertaking.  In other words, it is a way of evaluating the dangers that every company faces on a daily basis that can hamper their normal flow of business, or even end their business.

So, in 2008, I joined forces with a friend of mine and we created an online tool that assesses risks in nine areas:


General Liability

Product LiabilityProtecting Workers with Business Insurance

Personal & Advertising Injury

Computer & eCommerce

Disaster Planning

Workers Compensation

Automobile Liability

Employment Practices Liability.  

We called it Kordica™.

Kordica™ was designed to not only uncover risk but also rate the frequency, impact, and duration of an event.  This information coupled with a thorough policy review gives me a complete picture of the risks my clients face, and the ones that need immediate attention.  From here we develop a mitigation plan to Control, Finance (insure), or Transfer the risk.



Many times Kordica™ has uncovered risks that the client needs to insure but that they feel can be easily handled through good procedures (Control).  Then there are risks that are out of their control, and need to be insured (finance).  But Kordica™ has also uncovered risks that aren’t the Client’s responsibility, or that should be handled by a third party (Transfer).  Control, Finance, and Transfer are the fundamentals of insurance, and when done correctly they make every Business Owner safer, and more profitable.  This is what makes a Kordica™ risk assessment a necessity of every business.

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Fiduciary, Pat Mertz,Insurance,Nebraska