Six Risk Control Techniques for Sport and Recreation
January 15, 2014
The Ball Is In Your Court
By Katharine M. Nohr, J.D.
Understanding the basics of risk control techniques is a first step in establishing a risk management program for your organization. The techniques are as follows:
Avoidance means electing to eliminate an activity completely in order to avoid the risk all together. An example of this would be to decide not to have surfing as a high school or university sport due to the high risk of injury or death. However, an organization may not wish to use this risk control technique as it might conflict with its goals.Loss Prevention
Loss prevention means to reduce the frequency of claims from activities that either can’t be eliminated or your organization chooses to continue. In order to prevent loss or make it less likely, loss prevention means to break the sequence of events that lead to loss. Examples of loss prevention are padding your goal posts in order to prevent serious injuries or providing padlocks for gym lockers in order to prevent theft.
Loss Reduction is taking action to reduce the severity or financial consequences of losses and claims that are not prevented. An example of this is to install firewalls or fire suppression equipment such as sprinklers in athletic facilities. Another example would be to provide players with helmets or other protective gear which would serve to reduce the severity of physical injuries.
Segregation, Separation or Duplication
Segregation means to design or designate a certain area within a building or structure. For example, your organizations computer room or administration area might be segregated to a portion of the building with security controlled access in order to reduce potential losses.
Separation means to spread activities over several geographical locations so that if one suffers a loss, the other would be sufficient to satisfy the needs of both. A university might have multiple campuses with gymnasiums on each campus. If one campus is destroyed by a natural disaster, the gymnasium on another campus can be used for all activities.
Duplication means to have a backup for critical systems or operations. An example of this is backing up your computer system and so if it crashes, you have a back up. Another example would be to have extra sports equipment or spare parts that can be used if there is a loss or break down of the primary equipment.
Risk transfer means to reduce risk by transferring a portion of the risk to another organization. An example of this would be to hire a commercial bus company to transfer athletes rather than using your own vehicle. Contractual transfer is another form of transfer, which means to use hold harmless or indemnification agreements, waivers of subrogation, limit of liability clauses or exculpatory agreements.
All of the above (except avoidance) can be used in combination with other risk management techniques. For example, an organization might be concerned about the impact of a building fire and so might install fire walls (loss reduction technique) and have a second gymnasium in another location available should one be damaged by fire (separation).
In short, a risk manager should understand how to utilize the above risk control techniques in order to establish and maintain a risk management program.