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Risk assessment is the process of identifying, analyzing, and prioritizing potential risks that may impact individuals, organizations, or projects. It helps in making informed decisions and reducing negative consequences through proper planning.

Key Steps:

1. Identify Risks – List all possible internal and external risks (e.g., financial loss, natural disasters).

2. Assess Likelihood & Impact – Evaluate how likely the risk is and how severe its consequences could be.

3. Analyze Risk Factors – Understand root causes and contributing elements.

4. Evaluate Existing Controls – Check if current measures are effective or need improvement.

5. Prioritize Risks – Rank risks to focus on the most critical ones first.

6. Develop Risk Strategies – Choose actions like avoidance, mitigation, transfer (e.g., insurance), or acceptance.

7. Implement Plans – Apply strategies with clear roles, resources, and timelines.

8. Monitor & Review – Continuously track risks and update the plan as needed.

Purpose:
To proactively manage uncertainty, safeguard assets, and support decision-making through systematic risk handling.