Page 16 - EBOOK RISK MANAGEMENT
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2.0 FUNDAMENTALS OF RISK MANAGEMENT
2.1 Risk Management
2.1.1 Definition of Risk Management.
Risk management is the systematic process of identifying, evaluating, selecting,
monitoring and reviewing the risks that an organisation or individuals faces in order
to achieve its objectives. Examples :
Houses that may be damaged by flood
Collision of building due to lack of maintenance
2.1.2 Objectives of Risk Management.
Table 2.1 Pre-Loss and Post loss Objectives
Pre- loss = Before a loss occurs
Pre loss Reassures Stakeholders
objectives:
Reduce and Eliminate Harmful Threats
Better Communication of Risk within Organisation
Be able to inform decisions and make choices on possible outcomes.
Post loss = After a loss occurs
Post loss Support Continuity of Organisation
objectives:
Ascertain that risk management is in line with and supports the
attainment of strategic and business goals.
Stability of earning
Continued growth of the firm
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