Property and Risk Management Exam Summary PDF
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Summary
This document provides a summary of risk management covering property losses, net income loss, and a breakdown of key concepts like negligence, liability, and the distinction between TRM(traditional risk management) and ERM (enterprise risk management). The document touches on key legal and financial concepts.
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Here is the transcription of the image into a markdown format: ### Topic 2 *February 17, 2025 6:39 PM* ### TRM Loss Exposure **Property** * Ownership of financial or physical assets. * Theft/Damage - responsible to replace **Net Income Loss Exposure** * Triggered by an event * Usually pro...
Here is the transcription of the image into a markdown format: ### Topic 2 *February 17, 2025 6:39 PM* ### TRM Loss Exposure **Property** * Ownership of financial or physical assets. * Theft/Damage - responsible to replace **Net Income Loss Exposure** * Triggered by an event * Usually property loss **What constitutes negligence?** * Failure to exercise a proper level of care **Property Losses (when you sue)** * Easy to measure ($$) **General Damages** * Damage for intangible losses * Very difficult to measure **Punitive Damages** * Usually involving a large corporation * Ex. Cancer cluster (they knew) **Comparative/Contributory Negligence** * Plaintiff partially to blame * Ex. Someone hit you, but then you hit'em 8 times *** **Res Ipsa** * Injured party doesn't contribute (Dentist removed the wrong tooth) **Vicarious Liability** * Employers held responsible for actions of employees **Joint and Several Liability** * Negligence of 2 or more parties contribute to injury * Search for deep pockets) **Liquor Liability** * Businesses that manufacture or sell alcohol * Injuries resulting **Dram Shop Law** *** * Owner can be held liable if customer is overserved **Animal Liability** * Strict Liability **TRM Focuses on 4 Losses** * Property - done by risk manager * Net Income - done * Personnel - * Liability **ERM** * blends both * Very Strategic **#Hazard Risks** * fire, floods *** **#2 - Financial Risk** * Inflation * Mostly Speculative **#3 - Operational** *combination of speculative and Pure Risk* * Ex. Supply chain issues * Employee practices * Workplace violence **#Strategic Risk** * SWOT * Customer service issues * Ex. Verizon (If only 2% they won't care) TRM has a departmentized *** TRM has a departmentized approach * Focuses on hazard risks * Don't really care what happens to other areas of the firm (Individualist view) **Bailee Interest** * Bailee - receives property for business purpose * Bailor - owner **How to Correctly Identify Exposure** * Inspect - walk around
