Risk Reduction & Avoidance
Risk management is the acceptance of responsibility for recognizing, identifying, and controlling the exposures to loss or injury which are created by the activities of the University. Recognizing the need and responsibility to preserve the University's resources, the following information has been prepared to assist employees and students reduce and/or avoid risk exposures.
Depending upon the type of activity, employees and students can find qualified assistance in the Risk Management, Environmental Health & Safety, Public Safety, Facilities Management, and the Human Resources departments. With this assistance, they can follow certain steps to reduce and control risks. These steps are:
- Recognize and appraise the risk
- Estimate the probability of loss due to the risk
- Select the optimum method of treating the risk
- Implement a plan to carry out the selected method
Types of Losses:
- Destruction - Caused by fire, earthquake, wind, breakage, or deterioration
- Confiscation – Includes acts of crime such as theft, embezzlement, robbery, burglary, forgery, and conversion
- Loss of use – Causes loss of income, interruption of activities and/or extra expenses to continue operations
- Loss by Negligence - Liability can be incurred when persons are injured or property of others is damaged or destroyed due to negligence
- Loss of Reputation - Discrimination, sexual harassment, libel, slander, bad faith and unfair dealings create liability and poor employee/student/public relations
METHODS FOR TREATING RISK
- Avoidance - A risk may be avoided by not accepting or entering into the event which has hazards. This method has severe limitations because such a choice is not always possible, or if possible, it may require giving up some important advantages. Nevertheless, in some situations risk avoidance is both possible and desirable.
- Reduction – Risks can be reduced by implementation of standard operating procedures, education and training, limiting the numbers or types of participants, establishing security methodologies, duplication of records, selecting appropriate venues, preventive maintenance, etc.
- Transfer - Risks can be transferred to other parties contractually and through purchase of insurance. Examples of contractual transfer include requiring vendors to carry qualifying limits of insurance or posting bonds. Purchasing insurance should always be the last option for risk reduction.
- Retention, Assumption or Acceptance - Insurance deductibles are an example of retained risks. Some situations or activities are uninsurable and non-transferable, or the cost of insurance is prohibitive. Risks associated with these situations/activities are assumed by the University as part of the cost of doing business.
