Page 74 - ic92 actuarial

The Insurance Times

practical. Property losses can be avoided by not
owning property. Product liability can be avoided
by not manufacturing those products, whose
product liability is higher.

(ii) Loss prevention - Loss prevention can reduce the
risk, but cannot eliminate the probability or
frequency of loss. Designing loss prevention
measures clears understanding of how losses occur.
Steps that break the chain of events leading to loss
can reduce the frequency of loss. E.g, smoking
should be prohibited in places where pure oxygen
is in use for preventing fire.

(iii) Loss reduction - Loss reduction reduces the size,
or severity of losses that occur. Loss reduction
measures fall into pre-loss and post-loss categories.
E.g, of pre loss reduction to reduce the loss from
fire is the use of fire walls to limit the amount of
damage. E.g, of post loss reduction to reduce the
loss from fire is the installation of sprinklers. Some
post loss reduction measures occur after the damage,

Website: www.bimabazaar.com Call: 033-22184184 /40078428 74

Copyright@ The Insurance Times. 09883398055 / 09883380339