1-E Risk Management Flashcards
1
Q
What is RM?
A
Having a plan for how to deal with POSSIBLE future losses.
2
Q
4 RM Techniques- Risk Avoidance
A
Eliminates Risk by not taking an action that involves risk.
3
Q
4 RM Techniques- Risk Reduction
A
-Taking measures to reduce risk involved in an action
-Also called risk mitigation
4
Q
4 RM Techniques- Risk Transference
A
-Management of severe risks by transferring the risk to another party
-Most common example: Insurance!
5
Q
4 RM Techniques- Risk Retention
A
Accepting if if unexpected losses occur. Say if they chose not to get insurance, they are basically on their own if something bad occurs.
6
Q
Risk Management Techniques
A
High Frequency- Low Frequency
High Severity- Avoid- Transfer
Low Severity- Reduce- Retain
