Briefly describe the steps in the risk management process that should be followed by the risk manager of City Bus.
• Identify loss exposures: identify all major and minor loss exposures like property, liability, business income, crime, employee benefits, etc.
• Measure and analyze the loss exposures: it is important in order to manage them properly. This step requires an estimation of the frequency and severity of loss.
• Select the appropriate combination of techniques for treating the loss exposures. These techniques can be classified broadly as either risk control or risk financing
• Implement and monitor the risk management program: this step begins with a policy statement. This is necessary to have an effective risk management program. This statement outlines the risk management objectives of the firm, as well as company policy with respect to treatment of loss exposures.