What does the term "mitigation" refer to in risk management?

Mitigation in risk management specifically refers to the actions taken to reduce the overall impact or likelihood of risks. When an organization identifies potential risks, mitigation strategies are implemented to minimize their negative effects or to decrease the probability of their occurrence. These strategies may include implementing safety measures, providing training, or developing contingency plans, all aimed at enhancing resilience against potential threats.

In contrast, increasing risks and transferring risk do not align with the concept of mitigation. Transferring risk refers to shifting the responsibility for risk management to another party, such as through insurance, rather than reducing the risk itself. Assessing insurance coverage is about evaluating the adequacy of insurance policies to cover potential losses but does not involve proactive steps to lower risks. Therefore, reducing risk is the essence of what mitigation means in the context of risk management.