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Although some companies had already made progress in the development of a professional approach to insurance buying, it was not until 1929 that much consideration was given to the importance of the management of pure risk in business. In that year, corporate insurance buyers met informally in Boston to discuss problems of mutual interest. In 1931, the American Management Association establishes its Insurance Division for exchanging information among members and publishing news and information of interest to corporate insurance buyers. In 1932, the Insurance Buyers of New York (which later became the Risk Research Institute) was organised. In 1950, the National Insurance Buyers Association was launched; this later became the American Society of Insurance Management, and still later, the Risk and Insurance Management Society.
When these insurance buyer organisations were formed, insurance companies and insurance agents were less than enthusiastic. The new groups were immediately suspected. Agents feared that the organisations were the beginning of an attempt to bypass the traditional distribution system, of which the agent had always been the central figure. Insurance companies were concerned that they might eventually have to face a collective force that would insist on practises detrimental to them. With time, the true nature and intent of the organisations became evident, and the professional buyers' associations earned the appreciation and respect of the insurance industry.
The professional buyers' associations have done considerable work in the area of buyer education holding seminars on risk management and publishing information of interest to insurance buyers. The Risk and Insurance Management Society publishes a magazine called Risk Management, and the Insurance Division of the American Management Association publishes a wide array of reports and studies to assist risk managers. In addition, the Insurance Institute of America has developed an education program in risk management, with a series of examinations leading to a diploma in risk management.
As the professional risk managers' associations have grown, a large portion of the insurance-buying public has become more knowledgeable about insurance as a product. This has been especially true in the business world, but to a lesser extent it is true even in the area of personal insurance. With the outlay for insurance premiums more and more significant in individual budgets, people are devoting an increasing amount of attention to this expenditure. Price consciousness on the part of the insurance buyer has led to greater interest in matters of proper coverage and total cost. An examination of the principles and techniques that have been developed should prove beneficial at this point.
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