Risk aversion – Risk and safety assessment instruments

Assessing and reacting to risks

Generally, high-impact events are weighted more strongly than would be appropriate considering the actual detriment to be expected. 1 incident involving 100 victims is generally considered to be more serious than 100 incidents each involving 1 victim. As a result, major incidents – as well as the prospect of a major incident occurring – lead to stronger or quicker reactions (e.g. changes to legislation and regulations). The term "risk aversion" essentially means that the importance afforded to a risk increases disproportionately to the scale of the possible incident. Safety planning increasingly takes account of risk aversion by weighting damage with an aversion function.

FOCP-PLANAT project

For many years "Risk aversion and major incidents" has been the subject of sometimes heated debate. In 2005 the Federal Office for Civil Protection FOCP and the National Platform for Natural Hazards PLANAT launched a project on the topic of "Risk aversion – Development of instruments to assess the risks and safety associated with natural and technological hazards". Its aim was to provide a solid foundation for future discussions on this subject and to assist the planning of safety measures through the development of risk assessment instruments.

Review, analysis and practical recommendations

The authors of the report explore existing research to characterise the prevailing understanding of risk aversion and its relevance in relation to technical risks and natural hazards. From this they identify three separate components of risk aversion which grow in importance with the rarity and scale of an event: a widening and disproportionate increase in total damage; a rise in uncertainty with regard to the probability of occurrence and the scale of the damage, and special responsibility in the event of major incidents. In doing so, they are able to clarify the considerations entailed by risk assessments, thereby laying the foundations for a more consistent quantitative treatment of risk. The authors also suggest a method to quantify the three separate components of risk aversion and to apply them in practice.

Target readership: Professionals

The report is aimed primarily at professionals working in the field of natural and technical hazard protection. Consequently, it requires a thorough understanding of the issues of risks and safety planning. A summary can be downloaded here (German, French or English). The full report (in German, French or English) is available on order (see address opposite).