What is it and why bother with Risk Management?

Put simply risk management is about looking at the risks or hazards that can arise in your development and then putting in place sensible measures to control and prevent them.

Risk management covers all the processes involved in identifying, assessing and judging risks, assigning ownership, taking actions to mitigate or anticipate them, and monitoring and reviewing progress.  

Good risk management helps reduce hazard and builds confidence to innovate and improve.  It will also help prevent any claims against the residential management company and its directors for loss, damage or injury and will enable your site to reach its’ full potential in terms of its’ saleability and market value.

There are all types of hazards and health and safety issues associated with blocks of flats, all of which are a subject in their own right and include the following:

  • Fire, storm, flood, theft, impact, subsidence and other insurable risks
  • The condition of the building and building maintenance works including regulatory passenger lift inspections
  • Working at height
  • Slips, trips and falls
  • Water, gas and electrical installations and portable appliances eg: subject to PAT testing
  • The use of hazardous substances such as cleaning fluids, pesticides and asbestos containing materials
  • Diseases and infections such as might be caused by rodents, tetanus or even Legionella, which can grow in hot and cold water systems
  • Waste management
  • Manual handling of heavy loads
  • Violence and threatening behaviour
  • Working alone

Those at risk include occupants, employees, contractors, suppliers and other visitors, as well as neighbours and the general public

The risk assessment itself is often carried out or instigated by the residential managing agent with reference to the lease, which will help in identifying who is responsible for what.  Many of the actions will fall to the managing agent but some may fall to the landlord, caretaker and other parties. 

Whilst it cannot be said that good risk management will have an immediate impact on the price you pay for insurance, what we can say is those that take risk management seriously tend to have fewer accidents and over time generally pay significantly less for their insurance.

Whatever your business however, accidents happen.  Sometimes the cost may be covered by insurance or you may be able to make a claim against another party.  However, no amount of money can truly compensate for serious loss, damage or injury or death and there is also the disruption, stress and other hidden costs that can arise from even the smallest of events.

It should also be remembered that even if even if you have taken out the most comprehensive insurance policy to cover your building, this should be accompanied by a reinstatement cost assessment for insurance purposes to ensure the property is insured for the correct amount and to obtain the full benefit from the policy.

In summary, time taken now in taking action to prevent accidents, loss or damage and also in ensuring that your property is adequately insured will provide confidence and peace of mind that any potential incidents and disruption will be kept to a minimum.  Such action will also ensure that if you are unfortunate to suffer a loss covered by insurance that your insurer will be able to deal with your claim in the most timely and effective manner.

Director, Barrett Corp & Harrington Ltd