Risks And Damages In Various Scenarios

The purpose of this Unit is to provide an introduction to the study of Risk Knowledge Participants should:

• Be familiar with personal and social perspectives on risk imposition and acceptance in society Understand the threat and vulnerability model and the risk management process model
• Understand the principles of risk estimation and assessment
• Be aware of formal methods of analysis of processes leading to damage, damages and loss
• Understand the distinction between pro-active and reactive approaches to risk managemen

Coal Mine Explosion

The case presents an environmental risk where the hazardous chemicals have the potential of harming the people, property, and the environment through pollution. There are two types of coal mine explosions where it includes methane gas explosion and coal dust explosions. Methane explosion occurs when a build up of methane gas comes into contact with a source of heat. Once methane explodes, it lights up a coal dust explosion leading to worse occurrences (Wang, Pan, Li, Huang, Dong, Ai, Liu, Wu and Xing 2018). The mining process had the possibility of penetrating into the hydrocarbon gas thus causing the explosion. To prevent the same, there needs to be proper storage of chemicals and adequate fire precaution equipments at site to reduce the level of damage. Proper handling procedures should be taught to the workers to assist in saving the situation.

The act of the airline hitting the power line led to the reduced speed, which led to the plane hitting the road. However, the flame was sparked by the petroleum impact at the moment the plane hit the ground thus leading to the mishap (Aven 2016). Petrol has the ability to explode whenever it hits hard on the ground especially in the case of an aeroplane. The form of energy in the case remains petroleum in the aircraft which led to the explosion that occurred once the individuals had alighted.   

The threat in the case resulted from the action of transfer which saw the lady apparently fall into the cold water. Since the death of the lady was largely attributed to the exposure in the cold water, it then becomes the non-energy source responsible for the death of the sick woman. Thus it is a utility risk that occurred leading to the unprecedented event of death.

The case presents a property and equipment risk as occasioned by the failure of the cables to handle the bridge. The deaths were caused by the failure in the cables leading to the fall into the river. The case presents a non-energy source mishap caused by the cables.   

The case of the cliff falling off was a natural disaster and hence the non-energy source that led to the death. In this case, it can be defined as a property risk which occurred due to act of nature (Olson and Wu 2017).

The collapse of the building can be attributed as a property risk which led to the collapse of the building. The people killed suffered the damage from the non-energy source in the factory due to the building collapse (Elazegui, Rola and Allis 2016).

Aeroplane Mishap

The case presents a pandemic risk occasioned by the poisoning of the food by an employee. The effects of the poisoning were felt by the consumers of the product. The factory is to be held to task as its insurance against any pandemic would be forced to cover the compensation of the affected parties (Dover, Kirwin, Hernandez-Ceron and Nelson 2016).

The primary cause of the fire was the arsonist action of lighting up the nearby forest and bush. The fire affected the nearby mine leading to the burn up that spoiled the air quality of the region. However, the plant owner’s action of removing the water pipes accelerated the case leading to the build up of fire that would have been prevented were the pipes available at the time of fire (Haddow, Bullock and Coppola 2017). A cover for property and fire would assist the company in overcoming the aftermath of the event.

The bolt on top of the internal doors was responsible for the risk that led to the killing of the wild life park keeper by the tiger. The systems put in place failed to secure the attendant leading to the death occurring as a risk factor to the organization of the park. More preventive measures ought to have been instituted to prevent the saddening action from occurring (Swaminathan and Joachims 2015). At the same time, the guard ought to be armed and working in pairs for one to prevent or assist the other in times of possible risks and failures.

The failure of the dam tailings led to the destruction and loss of life in the event. The case needed to be insured against the property damage so as to compensate the affected parties in the case.  

First, The case would lead to the possible grounding of the ship which would lead to a catastrophic spill of the contents of the ship. Grounding would lead to further damage as it would affect the path for other ship and cause possible delays leading to financial losses.  Secondly, forgetting to place the coordinates would lead to possible costs and damages on the side of the ship owners for failing to safeguard the ship from the risks.

In the third scenario, the ship owners and navigators would be forced to pay a fine for the charge to the marine authority and conduct a possible clean up exercise that would be costly on their side (Li, Yang, Wang, Rose, Chan and Dong 2016). The first mate would be charged for using the short cut and failing to oversee the process to the complete end. On the other hand, the second mate would be charged for failing to adhere to the instructions placed by the first mate once he retired to rest leaving him in charge of designing and inserting the coordinates.

Risk from Exposure to Cold Water

In the first case, grounding would lead to more incurrence of financial costs due to the damages on the side of the marine life and the authority. A lot of funds would be used in the case in pulling out the ship from the place. On the other hand, it would lead to a possible spillage of the oil thus damaging the marine life adversely.

Lack of proper control of the ship would lead to a possible deregistering or suspension of the operating license on the firm or the specific people involved in the operations. As such, it would damage them financially as their career would remain at risk after paying the fines and facing possible trials (Cameron and Shah 2015). 

Cleaning of the damages would cost the ship owners a great deal as well as catering for the time loss of the cargo on transit. The insurance would charge them a fee apart from guaranteeing the part of the loss occurred. In this case, it affects the overall operation of the firm and the reputation among its customers.

The event occurred when the lead team failed to turn at the waypoint required by the intended course of the ship. The mix-up resulted from the change of the coordinates occasioned by the change in shifts between the first and the change persons in charge. Finding an alternative route was good but then the failure to insert the last coordinate on the navigation map led to the risk that saw the ship grounded. As a result, it is alleged that some level of oil spill on the reef thus damaging the ecological aspects of the destination. The persons involved were then held responsible for the action where each was to be charged a significant amount for the action leading to the grounding in an area assumed to have a proper leeway (Peters, Schwartz and Lubell 2018).

The fact that both parties were aware of the coordinates and the use of the short cut to the seaway led to the court proceedings where the possible charges would be conducted. Meanwhile, the cleaning for the damages caused began at the cost of the ship owners as it had to be treated with emergency to reduce the possible harm to the environment.     

The event led to a possible pollution, though not in worst case scenario. In this case, the marine park officials can engage in a clean-up exercise funded by the ship owners to cater for the damages committed by their action. The Great Barrier Reef was at risk of the oil spillage that had to be removed in the shortest time possible to avert the damage on the marine life. Since the evidence of the oil spillage pointed towards the Shen Neng 1, it was prudent that the persons involved cater for the cleanup and pay up for the damage caused through their insurance risk management (McNeil, Frey and Embrechts 2015).

Risk from Cables

On-site assessment on the possible damage ought to be conducted to realize the level of damage not only to the outside environment but also to the goods on transit within the ship (Suter 2016). A count of the people inside has to be done and their safety ascertained to prevent damages in the long-run. Persons within the ship have to be evacuated and restrictive measures placed to prevent their return to the ship until all the safety concerns have been duly completed. Further, health and safety assessment on the marine life has to be conducted to assist determine the level of damage and prepare for the damage control measures as per the insurance policies. Since the ship is insured, it would be prudent to inform the insurance firm and have their personnel come on site to perform the assessment and costing of the compensation to the marine authority.

In averting future occurrences, it is prudent that an intelligent control system should be adopted to utilize communication technologies in monitoring and preventing future occurrences (Pastorok, Bartell, Ferson and Ginzburg 2016). Placing the mechanism would assist in averting more grounding of ship thus prevent damage on the marine life. Geo-fencing would also assist in preventing access to restricted areas by either ship or any other foreign bodies that may cause a havoc to the region. Watch towers should be created to provide proper communication and warning signals to ship operators approaching restricted zones. In this way, future occurrences would be prevented thus acting positively towards reducing risks for the marine life (Vidmar and Perkovi? 2018).

The event already occurred thus the need to deal with the aftermath of the situation. In risk assessment and management, pre-conditions involve the necessary checks to be conducted before the overall beginning in handling an event. In this case, the safety measures have to be checked to ascertain the person in charge of the accident in determining whether it was intentional or accidental (Faure 2016). Afterward, the insurance firm and type of coverage has to be confirmed to assist in the recovery process and damage control. All these factors assist in handling the situation and ensuring a smooth compensation process from the insurance firm covering the ship and its personnel.    

The event is disastrous to the marine life, park officials, and the persons involved in the ship management. First, the little spillage after the grounding could lead to a destruction of a few of the animals and general habitat. As such, as the process of cleaning up is awaited, a significant amount of damage would have occurred leading to losses. Secondly, the marine park officials would be in for an explanation as some of them are expected at all times to be vigilant of the occurrences within and nearby the reef region. In this respect, the persons in charge would face possible fines, suspension, or even dismissal as a result of the occurrence (Torabi, Giahi, and Sahebjamnia 2016). In any case this was observed, preventive measures and risk management exercises were expected to be called in adequately to clean up the mess as the rest of the compensation process awaited.

Dam Tailings Failure

Thirdly, the human factor would suffer from the consequences of the same. The ship was carrying commodities that were on transit, which as a result of the occurrence experienced a possible delay leading to the losses and waste of time. Such incidents work negatively to the reputation of a company thus leading to future consequences on its operations. At the same time, financial damages have to be cleared both to the marine park and the ship owners. The ship owners have to pay fines for the occurrence as well as cater for the compensation of the clean-up exercise. At the same time, the persons responsible have to carry their own cross for the damages done. Each party shall have to pay fines according to their responsibilities and the requirement of the marine operations (Chevron 2017). Moreover, it might lead to their possible suspension and even dismissal in case findings indicate the possibility of neglect to the duties at the work place leading to the damage on marine life.   

The simple linear model of time sequence can be used in describing conditions and circumstances leading to possible mishaps. The simple linear model draws the assumption that accidents occur as a result of the culmination of series of events or circumstances which interact in a sequence with each other in a linear fashion. In this respect, accidents can be prevented by eliminating one of the causes in the linear sequence thus remaining risk free or reducing the risk altogether.

The reasoning in this case is justifiable given the sequence it follows and the issues that can be avoided in mitigating risks. For instance, in the case of the ship grounding, there are several aspects that occurred leading to the accident. The sequence to the cargo ship grounding on the Great Barrier Reef after de-docking where the second plotted a course with the captain to use the common short cut to the deep sea (Hopkin 2017). The coordinates were entered by the two into the navigation system except the last one, a fact that was communicated to the first mate when the second one went to rest. The mistake began where the first mate, upon being informed of the task to enter the last coordinate forgot to do so hence leading to the wreck. The series observed indicate that if one aspect was done right, it would have prevented the overall accident from occurring. For instance, had the second mate who entered the coordinates with the captain finished inserting the last coordinate before handing over to the first mate, the accident would not have occurred. At the same time, the second mate would have prevented the accident from occurring if he had followed the instructions and remembered to enter the last coordinate as instructed (Cole, Giné and Vickery 2017). The single omission of instructions led to the several other series that occasioned the accident. Thus, the time sequence is applicable to the case and can be used to justify the occurrences leading to the ship grounding.    

Poisoning from Food

Time zone 1 reflects the actual location of the ship prior to the occurrence leading to the grounding. Time zone 1 involved acts leading to the accident where the first mate fell off to rest after supervising the hours of offloading and other activities at the port. Overworking at the first zone is seen as a precursor to the accident as the second in command could not step in to assist. People are not expected to work for long hours especially in cases where an assistant is available. According to Bowers and Khorakian, 2014, it would be proper for the first in command to set the coordinates with the captain to avert the possible omission of the last step to safety. 

As such, the second in charge took the chance to enter the coordinates as the journey took off while the first one rested. Along the way, the first mate rose to duty picking where the second left. In this case, it can be assumed that the first mate did not have enough rest after the numerous hours of staying awake. As a result, it might have led to the forgetting of the last coordinate. The sequence from the second mate failing to complete the coding led to the possible accident. In risk management, it is proper for one to begin and complete a setting stage before handing over shifts to another person in charge. At the same time, it is proper to provide a brief to the next person on shift and as well have the deliberations considered adequately. In this case, the first mate picking from the latter failed to take in the instruction as he forgot to place the last coordinate. Safety measures ought to have been considered to prevent the occurrence by remaining keen and taking precautionary measures especially in coordinate points setting for navigation (Lam 2014).    

The risk at hand involves a cargo ship that wrecked and ended up destroying numerous goods and people leading to secondary damages over the place. The ship carried 50 crew members and several cargo containers destined to different locations. As an insured ship, there were several risks that occurred and had to be covered by the insurance firm as compensation measures.

There are several units of exposure for the risk as earlier deliberated by the insurance firm. First is the risk of losing containers and other goods on transit by the ship which have to be paid according to the owners quantity. Secondly, payment to the crew members serves as a unit where each individual has to be compensated following an accident (Harrington and Niehaus, 1999). The third one is the marine life which have to be cleared and adequate assistance done to reduce the harm or damage committed as a result of the damage.

Property and Equipment Risk

The probability of such an occurrence remains low as several measures along the marine lines are considered to ensure limited number of occurrences happen. As such, the probability of such occurrences remains low.

The frequency of occurrence for the various categories differ according to the preventive measures placed. For instance, the frequency of a shipwreck remains lower as several watch towers and guides exist to ensure warnings are sent in time. At the same time, frequency of risk of deaths on crew members is reduced given the presence of motor boats and floaters that can be activated and used in emergency situations for saving. The marine life risk remains high should an accident occur and thus remains with the highest frequency.

The identified risk involves the consequences of acquiring loss or damage caused to the ship, terminals of cargo, various offshore and onshore properties exposed (for instance, containers, ports, platforms of oil, pipelines) and many others. The risk identified lead to consequent losses and in this case losses can be broken down in terms of the cost.  Essentially, damage to the main engine incurs the maximum cost and that is followed by the auxiliary engines and thereafter the turbo chargers. However, damage to the entire container ship can lead to huge loss where costs of value of container ship (around 10 million) along with damage to different parts can be taken into consideration. In addition to this, ship wreckage also leads to huge loss to marine life that causes unprecedented loss to the ecosystem.

Risks Identified	Value Assigned (in terms of AUD)
Container Ship	10 million
Container	3000 to 5000 each (depending on the size of the container)
Main Engine Failure	5000000
Turbocharger Failure	800000
Engine Room Fire in Cruise Ship	280000
Rudder Damage	975000
Boiler (loss of water and tanker)	120000
Reduction Gearbox Damage	480000
Auxiliary failure of engine	525000
Cargo Crane Slew Ring	700000

The risk poses huge amounts of financial damages to the insurance firm. It is expensive to compensate a cargo ship carrying over 1000 containers with goods of unknown value as well as people who have high compensation costs. Costs directed to the marine department for clearance and other services are equally high and can lead to financial damages to the ship owner as well as the firm providing insurance. 

The ISO guideline defines risk as any element that is capable of resulting into loss or damages in a given setup. In its sections, it refers to the risk management entailing the coordinated activities in directing, controlling, and organizing organizations with regard to risk management (Purdy 2010). In this respect, it provides a framework, policies, and plans to ensure the minimal occurrences of risks in different business ventures. By large, it defines risk and opens up issues in dealing with and detecting the same thus helping in averting and lessening the consequences of its occurrence (Brenner 2007). Further, it defines the persons involved in assessing risks and providing measures or compensation in each case. The persons involve human resource requirements, engineers, technical experts, managers, analysts, software for operating, training, and standards of work. Moreover, it stipulates the importance of communication and training in averting the risk of exposure and persons involved in any occurrence.  In re-assuring safety, the guideline expounds on monitoring and evaluation where several aspects of risk are examined and a probable solution given for further improvement. All these aspects are entailed in the guideline in line with controlling, managing, and monitoring risks towards safety concerns around the globe.   

Ship Grounding

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