Risks and insurance

Question 1

What does a project manager do with regards to risk?

Answer 1

Attempt to identify as many as possible, assessing the chance of the risk occurring, the consequence or severity of the risk happening and what can be done to mitigate or avoid the risk

Question 2

When can risks occur in a project?

Answer 2

At any point in time

Question 3

Why are risks occurring later in a project more problematic?

Answer 3

Because there is a greater investment of time and money in the project at this stage

Question 4

What is brainstorming used for with risk management?

Answer 4

Used to identify risks.
Gets a large group of different skilled individuals together to think up all types of risks that may occur or affect the outcome of a project

Question 5

What is a risk analysis?

Answer 5

After identified and listed, risks are ranked according to probability of occurrence and severity

Question 6

What is qualitative risk analysis?

Answer 6

Considering each risk in a purely descriptive way, to imagine various characteristics of the risk and the effects that these could have on the project or subsequent operations.

Question 7

What is quantitative risk analysis?

Answer 7

Goes at least one stage further than qualitative analysis by attempting to quantify the outcome of a risk event or to attach a numerical score to the risk that ranks it according to its perceived claim for preventive or mitigating action.
Ranking denote priority for management attention

Question 8

What is FMEA?

Answer 8

Failure mode and effect analysis

Question 9

Define FMEA?

Answer 9

Qualitative risk analysis.
Considers risks and attempts to predict effects without ranking.
i.e. Potential impact vs chance of occurrence (high vs low)

Question 10

What is FMECA?

Answer 10

Failure mode and effect critical analysis

Question 11

Define FMECA?

Answer 11

Quantitative risk analysis
Considers risks and attempts to predict effects with some form of ranking.
i.e chance of occurring, severity, difficulty detecting and overall risk

Question 12

What is typically in a risk register?

Answer 12

ID number for each risk
Date Registered
Risk description and consequence
Proposed actions should risk materialise
Actioned by (person to take action)

Question 13

What are some methods for dealing with risks?

Answer 13

1. Avoid the risk
2. Take precautions to avoid or mitigate the risk
3. Accept the risk
4. Share the risk
5. Limit the risk
6. Transfer the risk

Question 14

What is the fundamental principal of insurance?

Answer 14

Premiums paid by the many will pay for losses incurred by the unfortunate few who suffer a loss.
A portion of the premiums paid will cover the cost of running the insurer’s business, expenses, and commissions and, together with any investment income, provide a profit and return on the capital employed.

Question 15

What are the four main classes of insurance?

Answer 15

Legal liabilities
Protection against loss or damage to property
Cover relating to personnel
Pecuniary loss

Question 16

What are statutory requirements??

Answer 16

Items which must be insured in order to comply with laws and regulations (i.e. motor vehicles on roads, injury arising from employment)

Question 17

What are liability insurances?

Answer 17

Onus on parties to insure against some of the risk.

Question 18

What are some examples for liability insurances?

Answer 18

• compensation to persons for bodily harm (employees of either party, others working on site, visitors, and members of the public);
• property loss or damage, including work in progress;
• financial loss;
• infringement of property rights
• product liability (arising from use of a product);
• professional negligence;
• nuisance caused by the works;
• environmental damage.