Risk, as defined by the insurance industry, is the probability that a loss may or may not occur. Risk management is the identification, assessment, minimization, and potential elimination of the various risks that can threaten an organization's financial stability.
The Bureau of Labor Statistics estimates that there are around 500,000 risk managers in the United States today and that this number will increase by 13%, or 64,000, before 2016. The most recent report on this booming profession revealed that the median salary for risk managers was $90,970, with only the lowest 10% of those surveyed earning less than $50,290.
Qualifications for Risk Managers
The best risk managers are detail-oriented business professionals with a knack for numbers and a keen understanding of how abstract forces may or may not impact their businesses. Companies regularly seek candidates who:
- Have college degrees in business, finance, or actuarial sciences
- Have worked as commercial insurance underwriters
- Have MBA's or graduate-level risk management degrees
- Hold related designations such as the CPCU or ARM
- Have had prior experience as claims adjusters or claims managers at large insurance organizations
Training for Aspiring Risk Managers
While it is important for those interested in becoming risk managers to hold degrees and designations related to the field, candidates with solid experience in the field are more likely to be offered jobs in this highly-competitive field. The most common avenues used when attempting to gain experience are:
- Entry-level commercial underwriting positions: Insurance companies regularly hire commercial underwriting assistants to assist more experienced risk managers. These companies will typically pay for any additional development opportunities pursued by the employee, which is a wonderful perk for those seeking to climb the ranks quickly.
- Middle and upper-level bank management positions: Bankers have a wide range of skills that can be easily transferred to the risk management field.
- The Chartered Property Casualty Underwriter, Associate in Risk Management, and Certified Risk Manager's designations: While designations are not to be viewed as the sole ticket into the risk management arena, they can help to differentiate one's credentials from those of his or her competitors while interviewing because the coursework itself is so thorough and requires a tremendous amount of commitment.
- The MBA in Risk Management: Colleges across the country have developed graduate-level programs for prospective risk managers. These programs are very attractive to career changers because they offer opportunities for internship.
Finding a Risk Management Job
Qualified, well-trained candidates can transition into lucrative careers as risk managers by pursuing one or more of the following channels:
- Networking: Modern-day career networks are valuable tools for experienced risk managers and career changers alike. Organizations such as The Risk Management Association and the Risk and Insurance Management Society are great places to meet industry insiders who may know of openings in the field.
- Local firms: Candidates who live in large metropolitan areas may be unaware of the number of local contractors in their areas who specialize in enterprise risk management. It's a great idea for job seekers to identify these firms and their websites so that they can be monitored for new job postings.
- Online career websites: This tried and true method is the most popular way to search for a new position. However, candidates who choose to use resources like Career Builder, Monster, and Indeed should keep in mind that the competition for these positions is fierce and could take a significant amount of time.
The path to a satisfying career in risk management is open and promising to those who are willing to invest the time and effort required.
