Final answer:
A claims manager must understand the company's growth strategy to align their risk management and claims processing with the company's goals and to attract external investors through a stable risk profile.
Step-by-step explanation:
Understanding the company's growth strategy is crucial for a claims manager because it directly influences how they manage risks, handle claims, and support the company's goals. Since the growth strategy may lead to increased profits, the company will attract more external investors such as bondholders and shareholders, who provide essential financial capital without intimate knowledge of individual managers. A claims manager who is aware of the growth trajectory can align their work to foster an environment that satisfies both internal goals and investor expectations, aiding in the continuation of capital flow necessary for growth.
As the company evolves, information about its products, revenues, costs, and profits becomes more widely accessible, reducing the necessity for external investors to know managers on a personal level. Nevertheless, a claims manager should understand this shift and anticipate how the changing dynamics might affect the company's risk profile and insurance needs. Aligning with the company's growth strategy, a claims manager will be better positioned to adapt to these changes, recommending appropriate insurance coverage, setting reserves correctly, and enabling efficient claims processing. This alignment is beneficial for supporting the company's overall longevity and success in the market.