Page 17 - Petrosphere - Loss Control Management (LCM) Training Manual V 1.0

16 Module 1: History and Philosophy of Loss Control Loss Control Management (LCM)

2. Pure Risk (Non-Speculative Risk) – it is the uncertainty as to whether some unpredictable event
that can result in loss will occur. Pure risk can result only in loss, never in gain. This kind of risk
consists of hazards such as a fire, death of key employees, or customer injuries on the premises
of the business. Pure risk exists when the possibility of loss is present, but the extent of the

possible loss is unknown.

Loss Control Management

Loss Control Management is the application of professional management techniques & skill
through program activities directed at risk avoidance, loss prevention and loss reduction, specifically
intended to minimize losses resulting from pure risks of business. Loss Control Management involves the
following:
• the identification of risk exposures
• measurement and analysis of exposures
• determination of exposures that will respond to existing or available loss control

techniques or activities.
• the selection of the appropriate loss control action based on effectiveness and economic
restraints.

Activities for Managing Control (ISMEC)

• Identification of Work – Elements of International Safety Rating System (ISRS)
• Standards – as measurement/guide to officials/employees performance
• Measurement – Disabling Injury Frequency Rate, Disabling Injury Severity Rate
• Evaluation – program effectiveness

• Commendation & Correction

Losses can be any of the following:

1. Time
• Rent/profit/commissions/use of property/lease/personal time due to illness, accidents,
death.
2. Possessions
• Confiscation
- Legal: inconsequence of liability imposed by law/liability assumed by contract.
- Illegal: theft/burglary/robbery/embezzlement/ conversion.

• Destruction
- Fire/explosion/flood/demolition/storm/typhoon, etc.

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