Page 48 - RISK Management IC86 Ebook
P. 48
Risk Management
l Payment out of current expenses
l Through a funded or unfunded loss reserve
l By debt or equity financing
l By pre or post-loss credit
l By forming a captive, a trust, by pooling or through a
spread-loss plan.
ii) Transfer
l Contractual transfer,
l Commercial insurance,
l Hedging (business risks only) RISK CONTROL
PURPOSE AND DETAILS
n The prevention and the minimising of loss are the most effective
means of reducing the cost of risk apart from eliminating or
reducing the risk itself.
n Risk reduction and loss control measures cost money to
implement and therefore it is essential that the risk be quantified
so that the most cost effective methods of handling may be
determined.
Risk Control
n The prevention and the minimising of loss are the most effective
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