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Understanding Risk Management, Insurance and Legal Issues

Chapter 14

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Rewards• Intrinsic rewards• Extrinsic rewards

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Risk Management• Identifying potential hazards and creating a safety

and health program to prevent their occurrence• 5 elements of effective safety & health program:

1. Management leadership and employee participation

2. Workplace analysis3. Hazard prevention and control4. Safety and health training and education5. Program evaluation

© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Hazards• Sharp objects• Machinery and

equipment• Slips, trips and falls• Hot surfaces and

liquids• Chemicals• Overexertion

• Muscular skeletal hazards

• Electrical hazards• Motor vehicle accidents• Infectious diseases• Workplace violence• Unpredictable work

environments

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Safety Committees• Responsible for:

– Hazard identification and inspections– Hazard control– Training– Accident investigations

• Considerations:– Group must receive clear guidance.– Group cannot be dominated by management.

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Insurance Program• Identify and analyze the exposures or potential

causes of loss.• Know the options to address the exposures, and

choose the best alternative for the group.• Monitor the insurance program and make

incremental adjustments to the package.

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Addressing Risk• Avoid• Reduce• Transfer

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Informed Consumer• Property insurance• Liability insurance• Personal and advertising injury liability• Fire damage liability• Medical expense coverage• Automobile insurance• Employment practice liability

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Selection of Insurance• A caterer must have the right coverage to fit the

business needs at a competitive rate.• To keep costs down:

– Higher deductibles– Higher coinsurance clauses– Low losses– Competitive quotes

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Contracts• Binding agreements between two or more parties

that create an obligation– Caterer is obliged to provide food and service.– Client is obligated to pay for food and service.

• Must cover a standard set of basic stipulations• Before entering into a contract, an attorney should

review its specific contents.