Risk is an inherent element of business and without appropriate management strategies in place, can be a cause of loss. Risks can directly affect day-to-day operations and impact on revenue or expenses. In some cases, the consequences of failing to manage risk may be serious enough for the business to fail or potentially lead to prosecution for managers and directors alike.
Generally, managers know that they should have insurance policies to cover risks to life and property. However, there are many other risks that all businesses face, some of which are overlooked or ignored. Sound risk management reduces the chance that an event will take place and, if it does take place, reduce its impact.