What Is an Active Risk?

Risk treatment refers to taking corresponding countermeasures, measures, or methods for risks of different types, different scales, and different probabilities to minimize the impact of risk losses on the production and operation activities of the enterprise.

Risk management

Right!

Risk treatment refers to adopting corresponding countermeasures, measures or methods for risks of different types, different scales and different probabilities, so that

The methods of risk treatment are mainly

Risk treatment refers to the economic operation process that uses different measures and means to achieve maximum security at the lowest cost. Common methods are: avoid, retain, prevent, suppress and pass on.

(A) Avoid

Avoiding risks is to abandon a plan or program so as to avoid possible losses and consequences. This is a negative processing technique.

The use of risk avoidance techniques is usually carried out in two situations: first, when the frequency and magnitude of losses caused by a particular risk are quite high, and second, when the cost of dealing with the risk is greater than the benefits it generates.

(Two) retention

Retention risk is the method by which an enterprise or unit can bear the consequences of risk damage. It includes active retention and passive retention. Generally, it is used when the frequency and magnitude of loss caused by risk is low, the loss is predictable in the short term, and the maximum loss does not affect the financial stability of the enterprise or unit.

(Three) prevention

Loss prevention refers to specific measures to deal with risks in order to eliminate or reduce various factors that may cause losses before the occurrence of risk losses. The purpose is to reduce the frequency of losses by eliminating or reducing risk factors. Usually used when the loss frequency is high and the loss intensity is low. Commonly used methods are: engineering physics and human behavior. There are two possibilities for accidents. One is the unsafe state of things and the other is the unsafe behavior of people. The "Engineering Physics Law" is a method that focuses on the physical factors of the risk unit, such as the design of fire prevention structures and anti-theft devices. The "Human Behavior Law" refers to a method that focuses on the education of people's behavior. Such as occupational safety education, fire education and so on.

(D) suppression

Loss suppression refers to various measures taken to reduce the magnitude of losses when or after they occur. It is an effective technology for managing risks, such as installing automatic sprinkler systems and fire alarms. A special form of loss suppression is detachment, which refers to a method of reducing the unit of risk by dividing the risk unit into many independent small units. Loss suppression methods are usually used in situations where losses are high and risks cannot be avoided and passed on.

(5) Passing on

Passing risk refers to a risk management method in which some units or individuals consciously pass the loss or the financial consequences related to the loss to another unit or individual in order to avoid risk loss. Common methods are: insurance transfer and non-insurance transfer. Non-insurance transfer includes transfer transfer and contract transfer. The former is mainly used for speculative risks, such as selling shares when the stock falls; the latter is mainly for companies to contract risky business activities to the other party, and it is clearly stipulated in the contract that the other party shall bear the risk Liability for losses, such as construction underwriting contracts, etc.