Category: Risk identification & assessment · Reviewed by Mark Fox, Broker · Renewals · Last reviewed
Bowtie analysis is a visual risk assessment technique that links the causes of a hazard, through a central “top event”, to its consequences and the controls placed at each side. The diagram resembles a bowtie — hence the name. It was developed within Shell in the 1970s and is now codified in CCPS guidance and IEC 31010.
Anatomy
Hazard — the source with potential to cause harm (e.g. “stored flammable liquid”).
Top event — the loss of control over the hazard (e.g. “release of flammable liquid”).
Threats (left side) — the causes that could lead to the top event.
Consequences (right side) — the outcomes that could follow the top event.
Preventive controls (or “barriers”) — placed on threat lines to stop the top event.
Mitigating controls — placed on consequence lines to reduce loss given the top event has occurred.
Escalation factors — factors that could degrade individual controls.
Strengths
Clear visual link between cause, event, consequence and controls.
Surfaces single points of failure and over-reliance on individual controls.
Excellent communication tool to non-specialists (boards, regulators, the workforce).
Naturally maps to the Swiss cheese model of accident causation (Reason, 1990).
Use in insurance
Bowtie diagrams are increasingly seen in cyber, energy, marine and major-hazard insurance submissions. They translate complex risk pictures into a single page underwriters can interrogate.
References
CCPS (2018). Bow Ties in Risk Management.
IEC 31010:2019, Annex B.4.
Reason, J. (1990). Human Error. Cambridge University Press.
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