Recruiter's Glossary

Examples: Heat Map • Risk Threshold • Risk Reporting

Risk Transfer

Term from Risk Management industry explained for recruiters

Risk Transfer is a basic strategy that companies use to protect themselves from financial losses. Think of it like passing a hot potato - instead of holding onto a risky situation, companies pass some or all of that risk to someone else, usually insurance companies or business partners. For example, when a business buys insurance, they're transferring the risk of potential losses to the insurance company. It's one of the main ways organizations manage their risks, alongside other approaches like risk avoidance or risk reduction. You might also hear this referred to as "risk shifting" or "risk sharing" in job descriptions.

Examples in Resumes

Developed and implemented Risk Transfer strategies that saved the company $2M in potential losses

Led the evaluation of Risk Transfer options across multiple business units

Successfully negotiated Risk Transfer agreements with third-party vendors

Managed Risk Shifting programs for a portfolio of commercial clients

Typical job title: "Risk Management Professionals"

Also try searching for:

Risk Manager Risk Management Specialist Insurance Manager Risk Analyst Risk Control Specialist Risk Management Consultant Risk Assessment Officer

Where to Find Risk Management Professionals

Professional Associations

Online Communities

• Risk Management LinkedIn Groups
• Reddit r/riskmanagement

Job Boards

Example Interview Questions

Senior Level Questions

Q: Can you describe a complex Risk Transfer strategy you've implemented and its results?

Expected Answer: Look for answers that show experience in evaluating different risk transfer options, implementing the chosen strategy, and measuring its effectiveness. They should mention specific examples of working with insurance providers or other third parties and demonstrate understanding of cost-benefit analysis.

Q: How do you evaluate whether to transfer a risk or retain it?

Expected Answer: Candidate should discuss analyzing costs versus benefits, considering company's risk tolerance, evaluating available options in the market, and understanding the financial impact of different choices. They should mention practical examples from their experience.

Mid Level Questions

Q: What are the main types of Risk Transfer methods you're familiar with?

Expected Answer: Should be able to explain different forms of risk transfer like insurance, contractual transfer, and hedging, with basic understanding of when each is most appropriate.

Q: How do you determine the cost-effectiveness of a Risk Transfer strategy?

Expected Answer: Should discuss basic cost-benefit analysis, comparing transfer costs against potential losses, and consideration of deductibles and premiums in insurance contexts.

Junior Level Questions

Q: What is Risk Transfer and why is it important?

Expected Answer: Should be able to explain the basic concept of moving risk from one party to another and provide simple examples like insurance or contractual agreements.

Q: What are some common Risk Transfer tools?

Expected Answer: Should mention basic tools like insurance policies, contractual agreements, and perhaps hedging, showing understanding of their basic functions in risk management.