What Is an Associate in Risk Management?

An associate in risk management (ARM) designation is a nationally recognized program developed by the Insurance Institute of America, or The Institutes, for dedicated risk management professionals. The science of risk management includes how to avoid, reduce, and manage risk.

Key Takeaways

  • Associate in risk management (ARM) is a designation awarded to risk management professionals who have successfully completed the ARM program.
  • The associate in risk management program focuses on risk assessment, control, and financing.
  • The ARM designation qualifies a person to work as an associate risk manager.
  • The ARM course program consists of three courses—ARM 54, ARM 55, and ARM 56—which includes an overview of risk management, how to assess risk, and insuring against risk.

Understanding Associate in Risk Management

A person with an associate in risk management (ARM) designation is deemed competent in the risk management process, including legal foundations of property, personnel, and net income loss exposure, and can assist in making risk management decisions to any organization's exposures to accidental and business losses. The ARM program consists of three parts: risk assessment, risk control, and risk financing.

An ARM designation qualifies a person to take a position as an associate risk manager. Duties include identifying, assessing, and controlling a company's risk. The associate risk manager secures the correct amounts of insurance for a company or develops a self-insurance program internally.

Risk managers project where things can go wrong, estimate the impact of a mishap, and administer programs that factor in the costs of recovery in the event of an incident and help reduce the chance of potential problems. They cover a broad range of risks relating to several subjects. Some risks happen within or because of the organization that they cover, like the chance of a manager quitting or a product failing. Others are external, such as the potential of a storm impacting a company's operations or a political shift of power complicating business operations.

Associate in Risk Management Courses

The ARM certification requires candidates to complete three courses and pass an exam. The first course, ARM 400, introduces the principles and practices of risk management and delivers a broad overview of what risk is, how to identify and analyze risk, and how to deal with certain financial risks. The second, ARM 401, encompasses and assesses types of risks, including risks to physical property, crime, and risks that come from management and human resource issues. Finally, ARM 402 builds on the other two, covering concepts of insuring against risk and financial strategies and considerations. As an additional requirement, ARM candidates also must pass an exam, covering insurance ethics, to receive their designations.

The ARM program teaches candidates how to assess and respond to the numerous risks and hazards insurance companies face. ARM also meets one of the requirements for the Risk and Insurance Management Society, Inc. (RIMS) fellow designation. RIMS is a not-for-profit organization dedicated to advancing the practice of risk management. RIMS represents risk management professionals around the world.