What is risk management?
Risk management is the forecasting and evaluation of financial risks together with the identification of policies and procedures to avoid or minimize their impact.
The role of insurance in risk management
A successful corporation understands risks and takes precautionary measures so that if the unexpected were to occur, it will be addressed with little to no negative impact, and bottom line damages will be mitigated.
It is important for every growing corporation, or one that is developing new operations, to seek the experience of an insurance and risk consultant who can assess the financial exposure of known risks, and discuss risks that might not have been identified.
Buying an insurance policy is not a holistic approach to risk management. There are a number of strategies, within a risk management plan, that can be discussed. This type of partnership will result in identifying, prioritizing and quantifying the risks, then identifying the most efficient use of insurance policies in managing those risks which are insurable.
Consider this guide for dealing with risk from ClearRisk and contact one of our Risk Management experts today.
1. Create a risk register. Brainstorm with your team about what risks you have: Operational, Hazard, Financial and Strategic.
2. Prioritize your risks in a risk map.
3. For each risk, assess what you are already doing about it. Is it enough?
4. If not, what else can you do to manage the risk? What are your options and what will be the cost and effectiveness of each alternative?
5. Implement the chosen risk management solution(s).
6. At least annually go back to the team and assess the list of risks, their priority, the efficacy of the risk management solutions in place.
7. Consider whether these changes will require an adjustment to your risk management plans and make the required changes.