Probably the most important factor in Insurance is risk analysis. You will be successful in this field only if you are able to understand the level of risk that you are taking. But the point is, how do you gauge the intensity of the risk ?
There is a mathematical model regarding this as well as a business model. Now me being from an engineering background, the mathematical model sounds interesting. So let us begin with that. After we cover that, we begin with the business aspect of things.
Right now, an overview of Risk Analysis ( Source: Wikipedia )
‘Risk analysis’ is employed in its broadest sense to include:
- Risk assessment
- involves identifying sources of potential harm, assessing the likelihood that harm will occur and the consequences if harm does occur.
- Risk management
- evaluates which risks identified in the risk assessment process require management and selects and implements the plans or actions that are required to ensure that those risks are controlled.
- Risk communication
- involves an interactive dialogue between stakeholders and risk assessors and risk managers which actively informs the other processes.
Risk analysis = risk assessment + risk management + risk communication.
No comments:
Post a Comment