Management of pure risks 

The activities carried out directly or indirectly by Risk Management S.p.A. cover every phase of the management process for pure risks, from identification to quantification, analysis and treatment. On the basis of those studies, strategies and actions for the prevention, elimination, mitigation or transfer of risks are established and implemented. Accordingly, each plant has put in place a specific plan to prevent and/or contain events that could negatively impact the continuity of production.

Risk Management S.p.A. has the support of a specialized external team, part of a leading insurance group, for the identification, quantification and treatment of those risks.

This provides Fiat with a dedicated team of 30 specialists in the prevention of industrial risk, assigned to conduct field audits and prepare risk profiles for each site, identifying the appropriate measures for prevention or mitigation based on international standards and verifying their correct implementation.

The audits of Group sites are based on a three-year cycle and for 2010 the scope of analysis (291 sites) covered approximately 89% of the insured value¹ of the physical assets of Fiat Group pre demerger. For activities falling within that scope, the objective is to analyze, based on specific risk sensitivity, substantially all sites (more than 98%) at least once each cycle and all principal sites (over 50%) at least annually. In 2010, 148 sites were audited, covering more than 58% of activities within the scope of analysis.

Risk Management S.p.A.’s internal team conducts a central assessment of the risk profile of each site, sets the action priority, determines the measures to be put in place for prevention, elimination, mitigation or transfer (through adequate insurance cover) of static risks, and monitors their implementation and progress status.

Prevention and mitigation measures put in place in 2010 resulted in targeted investment of around €33.2 million that enabled a reduction of approximately €3,600 million² in the potential value of losses for Fiat Group pre demerger, with a global efficiency index in excess of 100/1³. Further evidence of the level of success of those actions is the percentage of sites that attained Highly Protected Risk (HPR) certification from the international insurance market. Those sites, in terms of insured value, account for approximately 55% of activities within the scope of analysis.

During the year, coverage of all Magneti Marelli plants with the VisioRisk software was completed. This software enables real-time sharing of individual risk profiles. The application will be rolled out to all Group Sectors during 2011.

Also in 2010, the process of alignment with the guidelines issued by the Australian government was completed with the development of a guide for the incorporation of potential new risks associated with climate change into internal risk management processes.

Finally, with the aim of constantly improving its ability to quantify pure risks, Risk Management S.p.A. launched the following new projects:


• in collaboration with Magneti Marelli, AXA Risk Engineering and the University of Naples: development of a new quantitative methodology for seismic risk evaluation, for identifying sites potentially vulnerable to earthquakes and establishing action priorities, with launch of a pilot project in 2011;

• in collaboration with Fiat REVI S.c.r.l., Sector EHS departments, SGS and AXA Risk Engineering: development of a new methodology for identifying, analyzing and quantifying insurable environmental risks, with completion of pilot project at six sites by the end of 2011.