Risk Management: Risk Financing Methods

In Risk Management: Risk Financing Methods, you'll learn ...

• What is risk financing
• Types of risk financing options
• Methodology for selecting most appropriate risk financing option

Overview

Credit: 1 PDH

Length: 18 pages

THIS COURSE SHOULD NOT BE TAKEN TO FULFILL PDH REQUIREMENTS IN THE FOLLOWING STATES: NY, IL, MD, MI, NE

This course is part of a series of six (6) courses covering the topic of Risk Management. There are no pre-requisites needed for any of the courses. If you have limited knowledge of risk management, you would benefit most by starting with the course “The Risk Management Process”.

The remaining courses can be taken in any order or as a “stand-alone” course, based on your needs and interests. The most logical course order if you are seeking to expand your overall knowledge in the field of risk management would be:

1. The Risk Management Process
2. Risk Identification Methods
3. Risk Analysis Methods
4. Risk Control Methods
5. Risk Financing Methods
6. Risk Management Program Administration, Review and Evaluation

The financing of risk is the determination and application of the most cost-effective method for funding, providing capital resources, and the risk factors to which the organization is exposed.

Risk financing methods can be utilized to reduce the financial impact of risk factors that can cause financial harm to the organization or exploit the financial result of risk factors that can provide economic benefits to the organization.

Risk financing is dependent on a variety of support departments or service providers including finance, accounting, actuarial service, and auditing. The risk manager or the risk management department must be able to effectively communicate with each of these entities.

Through an understanding of the various risk financing methods, you will be prepared to apply the most appropriate risk financing method for each risk factor that faces the organization or project.

Upon completion of this course, you will be able to understand and be able to apply the most cost-effective method of financing for the identified risk factors to which the business organization is exposed as well as the various support departments or services needed to complete the risk management process.