Chapter 5 RM Framework And Process

Question 1

Risk owner

Answer 1

An individual accountable for the identification, assessment, treatment, and monitoring of risks in a specific environment

Question 2

Key performance indicator

Answer 2

Financial or non-financial measurement that defines how successfully and organization is progressing towards its long-term goals

Question 3

P – D – C – a cycle

Answer 3

Also known as the shewhart cycle and the Deming cycle is an expansion of an approach to process improvement the steps include plan do check and act

Question 4

What are five risk treatment types

Answer 4

Avoid the risk, modify the likelihood and or impact of the risk, transfer the rest, retain the risk, exploit the risk

Question 5

What are the key purposes of monitoring risk

Answer 5

Determine the effectiveness of controls, obtain information to improve risk assessment, analyze events that there are consequences to understand trends, successes, and failures, observe changes in internal and next ternal environment and identify emerging risks

Question 6

Risk control

Answer 6

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

Question 7

Risk financing techinquest

Answer 7

Risk management techniques such as retention or transfer that generate funds to finance losses that risk control techniques cannot entirely prevent or reduce

Question 8

A financial analysis of risk management techniques maybe based on three different forecasts what are they

Answer 8

A forecast of the dimensions of expected losses in [frequency, severity, timing of payment, and total dollar losses]
A forecast for each feasible combination of risk management techniques of the effect of the combines techniques on the frequency severity and timing of these expected losses
A forecast of the after-tax cost involved in applying to various risk management techniques such as insurance premiums or the installation of risk control equipment

Question 9

Revising the risk management program could happen in these circumstances?

Answer 9

New loss exposures for example a new merger or acquisition, new developments in existing lost exposures such as product defect resulting in liability, different risk management techniques such as the feasibility of captive insurance programs