Risk
Management
Risk
Management is the science of avoiding, reducing,
limiting or transfering the risk of financial
loss to which every individual is exposed.
In
the business environment risk takes the form of
physical damage consequential loss of income and
the threat of lawsuits.
For
professionals, the most significant risk to a
practice is the legal liability arising from mistakes
and omissions that arise from advise or services
performed. Law suits can be filed allegeing breach
of contract, negligence and other torts (civil
wrongs) or various stalutory and regulatory obligations.
Professionals
must manage the risk they face by instituting
a number of techniques. These include:
- Avoiding
the risk by not providing services or advice
in the areas that are high risk when the possibility
and potential for law suits is significantly
greater.
- Reducing
risk by use of best practice methods to ensure
work product review, continuing professional
education, the use of state-of-the-art technology
and a thorough understanding of client expectations
and the ultimate outcome of a failure to perform.
- Limitation
of risk by adopting protective corporate structures,
the use of appropriate engagement and disengagement
agreements including limitation of liability
clauses and establishing agreed payment terms
with performance ile posts and written procedures
for settlement in the event of a fee dispute.
- Transfered
of the risk of financial loss arising from a
lawsuit to an expert and well-managed insurer,
through the use of an appropriate written insurance
contract that encompasses all the services and
advice provided by the professional.
Jorgensen
& Company provides a variety of general and
individually tailored risk management services
to support and supplement professional liability
insurance placed on behalf of clients. |