Risk Management Ch. 3 notes

Risk Management Ch. 3 notes - CHAPTER 3 DISCUSSION...

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CHAPTER 3 DISCUSSION QUESTIONS 1. What are the three basic questions that must be addressed in identifying property loss exposures? Property Exposures Direct losses 1. What property do I have? 2. What perils are the property exposed to? 3. What is the value of the property (replacement cost)? Indirect losses- loss of business income as a result of damage to property Business income Loss profits Continuing expenses (ex: salaries of key people) Extra expenses 2. Distinguish between “business interruption” and “contingent business interruption” exposures and describe the types of losses associated with each. Business interruption- your property Contingent business interruption- someone else’s property gets damaged (suppliers, customers, magnet location 3. Identify the three categories of losses that result from exposures to liability losses. Liability- lawsuits for injury or damage to others Types Direct (defense costs, settlement/judgments) Indirect (damage to reputation) Mitigation expenses (product recall, marketing) 4. Define human resources loss exposures and explain how they can result in a loss of firm value. Human resources- death, disability, retirement, resignation/turnover
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This note was uploaded on 04/02/2012 for the course FINC 3134 taught by Professor Dr.eastman during the Spring '12 term at Georgia Southern University .

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Risk Management Ch. 3 notes - CHAPTER 3 DISCUSSION...

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