Trade Nov-Dec Interactive - page 8

JKJ&H Manages the Cost of Global Risk
It’s A Risky World:
I
t’s a risky world out there, but
Johnson, Kendall & Johnson and
its joint venture, JKJ&H International
in Newtown, Pennsylvania, have
invested in expertise to manage risk
German companies face in the U.S.
market. However, this is not a dry
article about insurance. The story of
JKJ&H is one based on a strong
transatlantic friendship and a
commitment to creating seamless
international insurance solutions.
Overcoming The Hurdles
JKJ&H’s primary focus is providing
risk management, employee benefits
and compliance advice to compa-
nies working in both Germany and
the United States. Whether an entity
is considering entry into the United
States or Germany, or managing
an ongoing company, the issues
can be daunting.
The differences in the German and
American insurance markets stem
from the origins of the two countries’
legal systems. The German insurance
market is governed by statute. For
example, employee benefits and
worker’s compensation recovery
limits are set by statute on a federal
level. Insuring those risks costs less,
and insurance is a transactional
business. German managers tend to
think of insurance in a more finite
way because litigation risks can be
less costly. In the United States,
insurance is regulated on a state-by-
state level, based on the development
of the common law. Worker’s
compensation and employee benefits
are privatized, and the insurance
premiums can be much higher when
compared to what German compa-
nies may be used to paying in
Germany. Julie Bartl, Vice President
of JKJ Employee Benefits, notes, “For
example, most German companies
are not prepared for the complexities
of American employee benefits.” The
United States is a more litigious
marketplace, which adds further
complexity and cost to purchasing
appropriate insurance coverage.
Although the United States is unique,
relative to litigation and risk, U.S.
entities are able to solve the mitiga-
tion of risk in a cost-effective way.
The European perception is to avoid
the United States’ litigation risks, but
there are many feasible solutions
available. Bruce R. White, Principal
of JKJ, adds “The difference in
insurance coverage is a hurdle that
German companies have to get over,
but not a wall. German companies
should feel encouraged to enter the
U.S. market.”
Communicating Risk
Between Two Worlds
Given the differences in German and
American insurance markets, one of
the most difficult obstacles in
managing risk is communicating the
market differences. Typically,
respective insurance companies and
brokers located in each country do
not effectively communicate with
each other. Sometimes, if different
German American Trade Nov/Dec 2013
8
C O V E R S T O R Y
“The difference in insurance
coverage is a hurdle that
German companies have to
get over, but not a wall.
German companies should
feel encouraged to enter
the U.S. market.”
Bruce R. White,
Principal of JKJ
1,2,3,4,5,6,7 9,10,11,12,13,14,15,16,17,18,...40
Powered by FlippingBook