Chapter 3 - Risk Control

Question 1

Avoidance

Answer 1

A risk control technique that involves ceasing or never undertaking an activity so that the possibility of a future loss occurring from that activity is eliminated

• lowers loss frequency

Question 2

Loss Prevention

Answer 2

A risk control technique that reduces the frequency of a particular loss

• lowers loss frequency

Question 3

Loss Reduction

Answer 3

A risk control technique that reduces the severity of a particular loss

• lowers loss severity

Question 4

Risk Control

Answer 4

A conscious act or decision not to act that reduces the frequency and/or severity of losses or makes losses more predictable

Question 5

Disaster Recovery Plan

Answer 5

A plan for backup procedures, emergency response, and post-disaster recovery to ensure that critical resources are available to facilitate the continuity of operations in an emergency situation

Question 6

Separation

Answer 6

A risk control technique that isolates loss exposures from one another to minimize the adverse effect of single loss

Question 7

Duplication

Answer 7

A risk control technique that uses backups, spares, or copies of critical property, information, or capabilities and keeps them in reserve

Question 8

Diversification

Answer 8

A risk control technique that spreads loss exposures over numerous projects, markets, or regions

Question 9

Life Safety

Answer 9

The portion of fire safety that focuses on the minimum building design, construction, operation and maintenance requirements necessary to assure occupants of a safe exit from the burning portion of the building

Question 10

Goals of Risk Control

Answer 10

1) Implement effective & efficient risk control measures
2) Comply with legal requirements
3) Promote life safety
4) Ensure business continuity