Maintaining a backyard filled with 2,300 vehicles and 8,000 employees means that CLM Fellow and Risk Manager Jason Jakubson utilizes every risk strategy available to keep his company’s bottom line green as the grass they maintain.
Q. What is your overall approach to risk management?
A. Our corporate philosophy and strategy is “consumer first,” as well as protecting our brand, employees, and the environment. This holds true for our risk management approach, too; we approach it holistically and it is embedded within our organization. Since we retain a lot of risk, we always are weighing the risks/rewards in everything we do. We are very proactive in risk management, versus being reactive.
We have been employing ERM techniques since 2009 by conducting risk assessments and identifying top risks. We just recently revamped our approach, and our risk management department is leading the initiative.
Q. What’s a typical day like?
A. A lot of it is directing traffic and providing strategy and authority for claims and lawsuits. On a daily basis, I am interacting with our insurance brokers, insurance carriers, TPAs, outside attorneys, and consultants—not to mention everyone with whom I work across our organization. That is what I love about my career: the opportunity to interact with all of our different business units and departments. I’m not a “desk” person, so I try and interact personally with everyone as much as I can. As a risk manager, I want to be approachable and visible.
In addition, I also provide insurance and indemnity insight for mergers and acquisitions, contract reviews, and the general management of our global insurance program.
Q. What has been your biggest risk-related success?
A. Since I started with Scotts over five years ago, we’ve seen decreases in claims frequency and average claims severity across all lines of insurance. This is the direct result of our business and global environmental, health, and safety units all working seamlessly together with our risk management team. We have a great working relationship and that goes along way.
Q. Have you ever taken a risk and turned it into an opportunity?
A. We’re always looking at the upside to any potential risk. Just recently, we explored weather hedging, a strategy to reduce financial risk associated with adverse or unexpected weather conditions. Being the seasonal business that we are, weather greatly affects our bottom line from a consumer sales standpoint, mainly in the spring. The weather being too hot or too wet hinders the rate that consumers might utilize our products. By hedging the weather, it would put us in a position to better protect our balance sheet and financial goals.
Q. What kinds of exposures and claims do you typically encounter?
A. Being in the consumer products industry, we see many unique and different types of claims. Any time the general public is using your products on a daily basis, it opens you up to just about anything. In addition, our Scotts LawnService brand provides residential and commercial lawn service, so we also face third-party premises exposure. Throw in 2,300 vehicles, 8,000 employees, and more than 150 worldwide locations, and we see just about everything across the board.
Q. How do you handle your claims?
A. From a workers’ compensation standpoint, we work with Broadspire, one of the largest TPAs in the world, which gives us the ability to utilize the jurisdictional expertise they have in helping us manage claims in all 50 states.
Our auto liability and general liability claims are managed by Vericlaim, and they provide us with three or four different adjusters. We have a great working relationship with them because they know our business inside and out. This is important to us because we have a lot of very complex claims, so based on their expertise and how long we’ve been working together, they are a very valuable partner. A third TPA, Fleet Response, handles our auto physical damage claims, and we handle our property claims in-house.
Internally, there are three of us who manage claims. Because we retain a lot of risk from an insurance standpoint, we ensure that we’re always proactively involved in every claim.
Q. How are you using predictive analytics?
A. We utilize PricewaterhouseCoopers to provide us with predictive modeling for our liability and workers’ compensation claims for budgeting and accrual purposes.