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Designations boost professional prospects


Professional designations such as the Associate in Risk Management or Chartered Property Casualty Underwriter have lost none of their luster despite the growth of college level risk management and insurance programs, say risk managers and educators alike.

In fact, the designation programs have in some cases become symbiotic with the college programs. And some risk managers and educators say that designations may become more important in the future for risk managers seeking to climb the corporate ladder.

The ARM and CPCU designations are earned by meeting educational requirements set by the Malvern, Pa.-based Insurance Institute of America and the American Institute for CPCU, respectively. The New York-based Risk & Insurance Management Society Inc. launched its own RIMS Fellow program a few years ago.

The designations were in the spotlight late last year when a version of a surplus lines reform measure specified that "qualified risk managers" were those with such designations or other advanced qualifications. The measure was later amended, but still the designations do highlight the accomplishments of those risk managers that have obtained them, several observers say.

"From both my experience and my view of it now, the content of those courses are pretty darn valuable," said Chris Mandel, former RIMS president and author of the quarterly BI column "Ask a Risk Manager." Mr. Mandel holds both an ARM and a CPCU in addition to a master's in business administration.

"Frankly, you get very little of that content in a college curriculum unless in one of the relatively few colleges that have an insurance or risk management program," said Mr. Mandel. "Even if you have an insurance undergrad or grad degree, you could probably find some value in some of the more specialized designations. I think earlier in your career, the first 10 years, the content value is fairly high."

For top risk management positions, such designations are crucial, said Mr. Mandel. It would be "a rare situation" to find a top risk management officer without professional designations among Fortune 500 companies, he said.

"They definitely have more value today than they ever have," said Jackie Hair, RIMS director, professional development. "If you look at job openings, you'll notice that they almost all require some sort of designation," said Ms. Hair, who is corporate director, worldwide risk management for Ingram Micro Inc. in Santa Ana, Calif., and who holds both an ARM and an MBA.

Ms. Hair said that the ARM has "kind of become standard" and that the "RIMS Fellow is taking that next step." She noted that in addition to meeting initial educational requirements, RIMS Fellows must also engage in continuing education.

"The risk management profession is finally coming into its own, and it's being recognized that this is a set of skills that is somewhat unique. The designations reaffirm to those who are not part of that risk management community that here is an individual who has mastered that skill set."

Academics agree.

"I've felt that they were important way back when I was in graduate school," said Dan Anderson, professor of risk management and insurance at the University of Wisconsin at Madison. "I don't have any sense personally that their importance has gone up or down."

Mr. Anderson said the University of Wisconsin program encourages students to pursue professional designations in addition to their coursework. He said the general business curriculum, combined with a risk management and insurance major, mean a student has covered 75% to 80% of the material needed to pursue an ARM or CPCU.

"Our advice is to complete the course, take the final, and then take the exam" for one or more courses required for a professional designation, he said. "With just a little marginal effort, you can graduate with maybe two or three exams under your belt--this gives you a competitive advantage against the other student" when job hunting.

"Many universities use our textbooks in their courses," said Rich Berthelsen, director-content development for the ARM program. "We get in the classroom that way and many universities also take our graduates" and grant college credit for ARM courses, he said, adding that "our graduates often qualify for three-hour college credits right there."

The designation programs also help fill a training need that might not have been necessary a few years ago, says a leading risk management and insurance educator.

"I think they're more important than ever," largely because expectations are higher in terms of both technical knowledge and the ability to translate complex concepts into understandable language, said Norman Baglini, professor of risk management, insurance and business ethics at Temple University in Philadelphia. Mr. Baglini, who is a former president of the IIA, said that in the past, many risk managers received professional training and on-the-job experience in brokerages or insurance companies.

"However, there's been a reduction in the number of formal training programs and the risk management world is developing so rapidly that it's imperative that risk management professionals be proficient even sooner," Mr. Baglini said.

Some risk management professionals, however, view the professional designations as valuable, but not crucial. For example, "it would be irresponsible to suggest that additional education in any form is unnecessary," said Dennis Bennice, former risk manager for Toledo, Ohio-based Dana Corp. and now vp with the Hylant Group, a Toledo-based brokerage. "But someone in the department with risk management experience can certainly adequately assess the markets without any specific advanced designations."

Nonetheless, "anecdotal evidence from recent graduates reinforces the point that risk management graduates who are passing professional designation exams" are advancing up the job ladder more quickly than those who have not, said Mr. Baglini.

Mr. Mandel predicts that professional designations, including those outside traditional risk management disciplines, will grow in importance in the future. Professional designations such as the Fellow in Risk Management, conferred by the Global Assn. of Risk Professionals, tend to be financially oriented but also tend to recognize the benefit of integrated risk management, said Mr. Mandel.

"The senior managers of the big companies of the future are going to expect more and more evidence that you understand the financial aspect of the equation," he said.