In simplistic terms ‘risk’ is a situation involving exposure to danger. However, in the insurance sense it is a lot more complex than that.
Prevention, as we all learn from an early age, is better than cure. In our world, it is better to stop accidents happening, improve working practices, thwart thieves and protect against extremes of weather than to rely solely on insurance claim payments to compensate for losses incurred.
That activity – risk management – has become an integral part of what the insurance industry does. From traditional property and casualty loss prevention measures through to business risks such as supply chain management, business interruption modelling and business continuity planning, risk managers are reducing the emphasis on the transfer of risk through financial payment and focusing on preventing losses in the first place.