What is a Risk Management Assessment?

The Risk Management Assessment, or RMA, is the first step in developing a comprehensive risk management program. The RMA identifies, analyzes, and reports on an organization’s material risk exposures. It provides a multi-dimensional view of risk, taking into account organization-wide enterprise risks and specific insurance-related exposures.

A typical Risk Management Assessment consists of five steps, They are:

Get to know the organization

Gather as much information as possible to learn about the organization, establish objectives, and review a timeline for completion of the RMA.

Examine risk management techniques

Take a closer look at the existing insurance coverage, what losses have been experienced, and the organization’s Total Cost of Risk (TCoR), as well as the risk management best practices currently in use.

Identify and analyze exposures

Ask a series of questions designed to uncover risk exposures and prepare an action plan to protect against these risks.

Get to know the organization

Gather as much information as possible to learn about the organization, establish objectives, and review a timeline for completion of the RMA.

Examine risk management techniques

Take a closer look at the existing insurance coverage, what losses have been experienced, and the organization’s Total Cost of Risk (TCoR), as well as the risk management best practices currently in use.

Identify and analyze exposures

Ask a series of questions designed to uncover risk exposures and prepare an action plan to protect against these risks.

Implement the plan

Address gaps in insurance, finalize loss reserve reviews and procedures and set a strategy for improvement.

Implement the plan

Address gaps in insurance, finalize loss reserve reviews and procedures and set a strategy for improvement.

Monitor results and provide support

Form a work group with members from the organization and provide ongoing guidance on risk-related issues. Recommend actions that support continued TCoR improvement.

Learn more about our Risk Management Assessments with this free PDF.

Working with the senior management team, the risk management consultants will:

Questions to ask

Objectives for the RMA

Scope of the RMA

Organizational structure to support the process

Tools and resources available

What sort of information is reviewed?

Common Goals for a Risk Management Assessment

Compliance : Reacting to externally imposed corporate governance guidelines that concern risk identification, disclosure, management, and monitoring.

Defense : Anticipating problems before they threaten the company’s strategic objectives. This is largely avoiding unknown issues that could undermine company progress.

Coordination/Integration : Breaking down internal silos by coordinating various pockets of risk management activity and awareness to improve overall company performance.

Exploiting Opportunities and Creating Value : Appreciating how risks interact across the enterprise and exploiting natural ways to avoid or manage those risks.

Upon completion of the RMA, the client will receive a written final report that includes

What will an organization get with a Risk Management Assessment?

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