what is risk-management?
Risk-management refers to all techniques used to reduce
occurrences of unfavorable events. That could cause bodily harm or financial
losses. What are these unfavorable events?
- Road carnage.
- Employee infidelity.
- Floods occurrence.
- Unstable economy.
- Bad debtors increasing.
Why is Risk-management highly recommended?
Well, risk management is very important. Read this.
- Society builds disaster preparedness. In-case floods occur or
lightning become more prevalent.
- Fund managers reduce chances of investment value decreasing
by hedging their funds.
- Commercial banks keep afloat by requiring security for loans
- Airlines ensure airplanes
are safer for short and long distant flight.
- Homeowners ensure their home are burglar free.
- Supermarket owners strive to minimize pilferage.
Features of risk management.
Risk management is an ongoing activity in the society.
Business people are always alert in identifying possible
risk exposures. They base their studies
on historical events. And then model on the successes and failures of past risk
Hazards increase chances of losses
- Faulty power lines could trigger fire or electrocution of an
individual. Therefore firms ensure that all wiring are done properly.
- Sheltering under a tree while it is raining is not wise. You
risk inviting trouble when lightning strikes.
- Driving at 129km/hr is great but when you bang onto a corner
it will turn into tears.
Benefits of risk-management.
- Losses are minimized.
- Fund managers will reduce financial losses when they hedge
- Commercial banks will increase profitability when borrowers
- You will live with peace of mind when you minimize possible
bodily harm. Like not walking from town
alone at night.
- Professionals become more trusted when they adhere to good
Four ways of managing
- Training medical employees on professional ethics and its
importance in client safety.
- Avoiding common negligence that can cause burglary and
- Taking up insurance cover with an insurance company.
- Setting up your own measures to combat risk.
Skills utilized by
- Statistical skills used in studying historical data.
- Mathematical skills needed in computing variances and
probability of risk occurrences.
- Creativity comes in handy in developing risk management
- Computer skills are necessary when working with statistical
packages to analyze data.
Are there risk management services?
Yes, there are risk management services.
For instance, insurance. Where you take out a policy and
share risk with the insurance company. It’s simple and straight forward. Just
approach an insurance broker for more details.
Success of risk
In my own view… risk management is successful.
But according to AON?
Insurance is very important.
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