RMI 2101 Study Guide - Midterm Guide: Personal Property, Bailment, Ebay

• School: Temple University
• Department: Risk Management and Insurance
• Course: RMI 2101
• Professor: Michael Mc Closkey

Document Summary

Manage pure risk (trm) and speculative risk (erm). Goal is to minimize financial impact on organization. Risk management: specialized branch of financial management. 1950s: did not manage risk; bought insurance; very narrow and not strategic. 1960s: professor wayne snider (temple) helps coin the term risk management. (1964) After that, risk management became a strategy. Present: very important function in a firm very broad. Identify exposure to loss: evaluate exposure to loss. (topic 4) Identify possible alternatives. (topic 5/6: select among the alternatives. (topic 7) Implement chosen option(s): re-evaluate periodically the chosen strategies. Most crucial step because if you don"t identify the risks you can"t prevent them. Ie: enron"s accounting firm, arthur andersen completely went off the charts within a year of the scandal. Executives hushed employees who tried to call attention to problems with enron"s accounting data. Loss exposure: possibility of a financial loss that a particular entity faces as the result of peril striking a thing of value.