Define risk in the risk assessment process

Reference no: EM133611694

You will assume the role of a senior analyst hired by a fictitious company, Premium Acceptance, a midsized property insurance carrier. Premium Acceptance is performing well with respect to several key performance indicators, including policies in force, policy retention, and new business counts.

One of your objectives as the newly appointed senior risk analyst is to develop a framework for managing loss ratios which is one of the firm's largest key performance indicators. A loss ratio is simply the difference between the ratio of claims paid by an insurance carrier and the ratio of premiums paid. The board of directors depends on the ability to forecast loss ratios, which in turn enables them to forecast profitability metrics to the shareholders. The organization will now consider implementing the use of statistics for measuring risks.

Your deliverable should be composed as a report. Be sure to address the following items:

Explain how statistics is used to formally define risk in the risk assessment process.
Discuss at least two statistical tools that can be employed to measure risk.
Convey which tool best serves the company's purposes and explain why it is.
What are the ramifications of the organization electing not to use statistics in this process?

Reference no: EM133611694

Questions Cloud

How have colonisation and invasion affected aboriginal : 'How have colonisation and invasion affected Aboriginal/ Indigenous peoples in Australia.

Article on inter-professional collaboration : In the Suter and colleagues (2012) article on inter-professional collaboration (IC), they present a state of affairs as it applies to health care.

Research the forms of business entities : Creating a spin-off business (possibly with one or two associates) but is unsure about what form of business entity would be best to use for the new business.

Evaluate impact of conflict on business reputation : Identify and evaluate impact of conflict on business reputation and legal liability.

Define risk in the risk assessment process : Explain how statistics is used to formally define risk in the risk assessment process.

Assess candidates scores on broad competencies related job : Create an interview rating form to assess the candidates' scores on broad competencies related to the job.

How do you believe sustainable strategies can be developed : Viewing things through the lens of social responsibility, how do you believe sustainable strategies can be developed and in what areas?

Article a toolkit for ethical-culturally sensitive research : Read the article A Toolkit for Ethical and Culturally Sensitive Research: An Application with Indigenous Communities.

How can you as a training professional ensure that client : How can you as training professional ensure that your clients continually fund training activities for their business units so you stay busy?

User Account

All Pages