Page 40 - RISK Management IC86 Ebook
P. 40
Risk Management
b) interdependencies between such sections/sub-sections.
Loss History
l Record of past losses is often an important indicator of
an organisation's exposures to accidental losses. However,
such records may prove to be inadequate to judge current
exposures, especially for a new entity as also where
substantial material changes have taken place due to
additions, expansions or modifications.
Hazard identification and risk assessment the cause, risk
& effects chain
l Most loss producing events are the end result of a chain
of events. Once risks have been identified, they must then
be assessed or evaluated or measured as to their potential
impact or severity of loss and to the probability of
occurrence.
In the assessment process it is critical to make the best
educated guesses possible in order to properly prioritize
the implementation of the risk management plan.
l Before a risk can be managed effectively it must be examined
carefully, identified and measured in terms of the following
factors, so that it may be assessed in comparison with similar
risks.:
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