8/18/2019 Risk Management Process of United Grain Growers.docx

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Risk Management Process of United Grain Growers

 No

. Type Of Risk  

EaR 

score

Impact

Desc.

Risk Assessment Risk response Risk Mitigation

inere

nt

resid!

a"

A#oidanc

e

Red!ctio

n

$arin

g

Acceptan

ce

% &eater %%.' Ma(or ) ) &eater Deri#ati#es

*

En#ironmenta"

+ia,i"ity *.' Minor ) ) Ins!rance-conto"

/o!nterparty 0. Moderate ) )

Di#ersification-d!e

di"igance-contracts

0 /redit %.1 Minor ) )

Di#ersification-d!e

di"igance-contracts

' In#entory *.* Minor ) ) Operationa" contro"2 ins!rance

1 /ommodity %%.3 Ma(or ) ) 4!t!res and Options

Range of Impact

%5 Minor  

051 Moderate

653 $e#ere

%75%* Ma(or  

8/18/2019 Risk Management Process of United Grain Growers.docx

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Using weather insurance

Tere are two kinds of weater ins!rance2 conditiona" weater ins!rance and weater 

cance""ation ins!rance.

• &eater cance""ation ins!rance

&eater cance""ation ins!rance ens!res tat if inc"ement weater does occ!r2 te

organi8ation wi"" not "ose teir in#estment. Instead2 an ins!rance company wi"" co#er 

tose costs ,ased on te si8e and type of te weater cance""ation ins!rance p!rcased.

• /onditiona" weater ins!rance

/onditiona" weater ins!rance gi#es companies te a,i"ity to make promotiona" sa"es

offers ,ased on te weater9 tis form of ins!rance !sed ,y ,!sinesses and organi8ations

to increase p!,"icity and dri#e traffic and sa"es. 4or e)amp"e2 a retai"er co!"d gi#e a year:s

wort of payments to te first %77 peop"e wo ,o!gt a car in No#em,er if it snows 1;

on New