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What is the definition of Risk Management?

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Risk Management refer to how risk is analyzed and anticipated, in such a way that a person or entity can either avoid them, minimize its impact or know what measures to take when it does happen.

Risk management is about analyzing the risks involved and covering for the risk by implementing safety measures, by self-insurance or by passing the risk on to insurance company.

First, the risk manager looks at what risks a life, property or business might face. Then, it looks at the risks that will cause the greatest economic impact to the individual or entity. Then, these risks are evaluated based on their possible effect on the business' bottom line. And lastly, risk management will involve creating a plan as to what should be done to manage each individual listed risk.

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