RMI 2101 Lecture Notes - Lecture 5: Natural Disaster, Job Sharing, Crisis Management

• School: Temple University
• Department: Risk Management and Insurance
• Course: RMI 2101
• Professor: Mccloskey

Document Summary

Evaluate your alternatives to managing the risks you of your firm faces. Activates or attempts to control the risk. Stop engaging in activity that causes the loss or never engage in the risk that causes loss. Reduce risk to zero if properly implemented i. e. a person won"t fly on an airplane - to avoid the risk of crashing. Avoidance may not be feasible or desirable. Loss profits associated with the activity (opportunity costs) May avoid future losses by avoidance but might not avoid costs from the past. When cost of risk > benefit (profit) from the activity. This strategy is mutually exclusive with respect to all other options. Attempts to reduce frequency or probability of the loss. May or may not also reduce severity (goal is to impact frequency) Activities that attempt to interrupt or break the chain of events that lead to loss. Examples: training programs, safety inspections, quality control checks, security guards.