Identify the major loss exposures faced by City Bus.
1. Property loss exposures
a. All the buses are exposed to loss exposures and they are garaged in three different cities, managing the condition of all the buses might not be an easy task so there are risks in it.
b. Computers, computer software and data.
2. Liability loss exposures
a. Traffic accidents might happened when providing the service, be it minor or catastrophic.
Also, there is liability arising from company vehicles.
b. Environmental pollution in air and noise.
3. Business income loss exposures
a. Loss of income from a covered loss
b. Continuing expenses after a loss
c. Extra expenses
4. Human resources loss exposures
a. Job related injuries or disease experienced by workers,
b. Death or disability of key employees
5. Crime loss exposures
Holdups, robberies and burglaries
Employee theft and dishonesty
6. Employee benefit loss exposures
Failure to comply with government regulations
Failure to pay promised benefits
7. Failure to comply with government laws and regulations
c. For each of the loss exposures identified in (b), identify a risk management technique or combination of techniques that could be used to handle the
For low loss frequency and loss severity like Employee theft and dishonesty, the appropriate risk management technique is retention,
For High loss frequency and low severity exposures like Property loss exposures, damage losses to buses, failure to comply with government regulations, failure to pay promised benefits, environmental pollution in air and noise, Job related injuries or disease experienced by workers, liability arising from company vehicles like violating the traffic low, the appropriate risk management technique could be the mix of retention insurance.
For low loss frequency and high severity exposures like Holdups, robberies and burglaries, catastrophic traffic accidents, Death or disability of key employees, Failure to comply with government laws and regulations, the appropriate risk management technique is transfer.
