CISR Elements of Risk Management Practice Test

Differentiating the elements that drive loss in risk management. Tornadoes themselves are the actual events that cause damage, so they are the peril. A hazard would be the conditions that increase the chance of a tornado occurring (like unstable atmosphere or odd weather patterns in Tornado Alley). Exposure is the value or assets exposed to that danger (the houses, buildings, and people in the path). Risk is the overall likelihood and magnitude of loss resulting from being exposed to that peril. So the tornado events are the peril because they are the loss-causing phenomena you’re assessing.