Risk & Insurance

Risk & Insurance

In today’s business environment the contractual relationship between a purchaser and service provider needs to be a collaborative partnership, especially given the reliance on service providers delivering what may have previously been considered the purchaser’s ‘core business’. This is a key issue facing WA government sector, with initiatives focusing on how the state government agencies interact with service providers to ensure the ongoing provision of service. This issue was the basis for a discussion at the recent Riskwest ‘Risk and Insurance Training Session’, one of three being delivered on behalf of WA Department of Finance. Representatives from a wide variety of government agencies explored the issues of risk and risk sharing decisions in the development and management of service agreements – particularly with the Not-for-Profit sector.

The second of the three sessions, the discussions largely focused on the need for all parties in the relationship to have a shared understanding of the risks associated with the service being delivered, consensus on who is best positioned to manage those risks and ensuring that is reflected within the service agreements. Whilst it’s important that the service agreement terms and conditions reflect the risks and risk sharing decisions, it’s also essential that the parties to the agreement act in accordance with the agreed terms. The risk information should help inform the indemnity and insurance limits, and identify the appropriate classes of insurance that the service provider needs to hold. The underlying imperative for the right contract terms and conditions is of course an understanding of the risks, so if you require any assistance in getting this understanding please contact Riskwest at enquiries@riskwest.com.au and we can take you through a thorough process to inform the purchasing decisions.