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- how to minimize your exposure to insurable risks
- What makes a risk insurable?
- assess your insurable risks
- minimize your insurable risks
- Should you insure all of your insurable risk?
- What are the benefits of minimizing insurable risks?
- always be ready to assess your insurable risk
- keep a record of compensation and insurance
- loss or damage to physical and tangible assets
- losses and damages caused by an interruption to your business
- responsibilities you have to third parties as a result of your organization’s business activities
- calculate the probability of the loss or damage occurring
- Define and measure the loss or damage.
victoria government risk management framework (vgrmf) requires your organization to work to minimize its insurable risk.
This should be understood as a risk management proposition, rather than an insurance question.
Reading: How can an insurance company minimize exposure to loss
minimizing your exposure to insurable risk is simply minimizing your risk of loss and damage. turns out to be a loss and damage of the kind that could be insured.
Whether or not you’re actually insured is a separate question, which we’ll address in this guide. If you’d like to learn more about optimizing your insurance with vmia, you can start with our guide to making an informed decision about financial risk retention and transfer.
how to minimize your exposure to insurable risks
See also: For Therapists: The Pros and Cons of Accepting Insurance
This is a standard risk assessment process, focused on a subset of risks: those that are insurable.
Your first task is to identify those risks. once identified, you can analyze their consequences and probability, and evaluate them. From there, you can see your options to minimize your exposure to them by using effective controls, which may include insurance.
what makes a risk insurable?
Insurance is a way to control the financial risks associated with events that cause loss and damage. to be more specific, it is the risk that you will face financial consequences that prevent you from achieving your goals.
See also: How insurance can help you
Insurance is designed for events of loss or damage that occur by chance and are beyond the control of the organization. that could be
to decide how to cover its financial risk, vmia must be able to
As part of the requirement to minimize your insurable risk, you must understand what financial consequences your policies cover.
In the next section, we’ll walk you through a risk assessment process and show you how, once you’ve identified your insurable risks, you can analyze those aspects of the risk that make them insurable and then assess them.
evaluation of your insurable risks
When evaluating insurable risks, you should look at those aspects of the risks that are material to an insurer, as described in the previous section. this means more focus on rigorous quantification of the probability and consequences of a potential event. it also means more attention in quantifying the possible financial consequences of that event.
