Page 199 - RISK Management IC 86

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Q1. (a) Give an outline of a written corporate risk
management policy for a medium size
company.

Ans. The Company's risk management policy is :
(i) To promote an active loss prevention programme to
eliminate or reduce potential causes of loss.
(ii) To operate self insurance schemes in areas where it
is economically justified.
(iii) To purchase commercial insurance emphasis in the
residual areas of risk exposures at the least cost.

The functions of the risk management department for
implementing this policy is :
(i) Assisting the various departments to operate

programmes to prevent fires, cargo losses and
industrial accidents.
(ii) Organising self insurance schemes, in consultation
with finance department.
(iii) Negotiating insurance contracts for appropriate
amounts and the risks at the least premium cost.
(iv) Keeping the insurance contracts up to date, in the
light of alteration in risk factors.

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