Page 49 - EBOOK RISK MANAGEMENT

approach to dealing with many risks. Although it is possible to avoid certain risks,

not all risks can be avoided.

b) Risk Prevention

Risk prevention seek to reduce the
frequency or likelihood of losses. For

example, a car is routinely inspected for

mechanical problems to avoid engine or
mechanical failures and reducing the

frequency of accidents. Risk prevention
methods normally has been imposed by

law or the businesses. It is compulsory for

employers to ensure their employees
wearing and using all protective

equipment or clothing provided, based
on Section 24 of the Occupational and

Safety Act (OSHA) 1994.

Figure 5.2 Examples of Risk Prevention

c) Risk Reduction

Risk reduction are designed to reduce or
minimise the severity of losses. As an example, a

company should install fire extinguishers in

order to reduce the severity of fire losses or
damage in a building. Other example is

separation or dispersion the assets of the

company will limit the severity of losses from
occuring whether it will not reducing the

number of fires or explosions that may occur.
Wearing seat belts while travelling by car or

airplanes also can help to reduce the impact

or injury.
Figure 5.3 Examples of Risk Reduction Tool

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