Risk Management, International Insurance Vital for Oil and Gas Sector
Lackadaisical safety and security policies can cost companies millions of dollars in regulatory fines, environmental disasters and employee endangerment. Risk management is difficult enough for domestic companies, and it becomes even more complex for international organizations with a large workforce overseas.
One industry with these types of concerns is the oil and gas sector. Employees are tasked with the exploration, retrieval, refining and transporting of oil and gas. This highlights the need for comprehensive international insurance that can help cover these aspects, and without proper protection the financial well-being of any organization could be in danger.
Lack of risk management leads to accidents
Due to the complexity of the oil and gas industry and the myriad of threats that organizations face on a daily basis, risk management is a vital and necessary part of any successful business strategy. These problems were discussed by Nancy Leveson, professor of Aeronautics and Astronautics at the Massachusetts Institute of Technology, in a testimony before the U.S. Senate Committee on Energy and Natural Resources.
She noted several common factors in major accidents occurring within this sector. For example, one of the biggest problems oil and gas companies encounter is a flawed safety culture.
Many organizations foster an environment of denial, where accidents are going to happen anyway, and don’t take enough preventive measures. So this lack of risk management causes gaps in protection and can lead to more accidents. Instead, oil and gas organizations should evaluate company culture, and work closely with employees to identify risks and create effective mitigation strategies.
Start off with a hazard analysis
Organization should start addressing risk with a hazard analysis, which will help to identify potential problems and take proactive measures before an accident occurs.
According to Fire Protection Engineering, a quarterly publication of the Society of Fire Protection Engineers, gas plants and other oil and natural gas facilities are some of the best locations to perform this type of measure. The goal of any analysis is to identify risky locations where accidents or injuries could occur. Once noted, the company can then perform further examination and recommend safety changes. Once the dangers of an operation are detailed, it will be easier for the oil and gas organization to determine any additional action. Organizations can safeguard against these risks through international insurance coverage.
As your partner in mitigating international risk, Clements can develop a policy tailored to your organization’s needs specifically for the oil and gas sector. Call us today at +1.202.872.0060 or 800.872.0067 or email firstname.lastname@example.org