Category: Risk identification & assessment · Reviewed by Mark Fox, Broker · Renewals · Last reviewed
Semi-quantitative risk assessment
Semi-quantitative risk assessment sits between qualitative and quantitative approaches. It uses numerical scales but those scales are ordinal or banded rather than continuous: likelihood of 1–5, impact of 1–5, with each band anchored to a defined probability range or monetary value.
Practical form
Likelihood bands defined as probability ranges (1: <1%, 2: 1–5%, 3: 5–25%, 4: 25–75%, 5: >75% per year).
Impact bands defined as £ ranges (1: <£10k through to 5: >£10m).
Optional weighting of categories of impact (financial, reputational, regulatory, people, environment).
Aggregate score by look-up matrix, not by multiplication.
When to use
Risk registers in mid-market organisations where full QRA is impractical.
Operational risk frameworks in insurers and intermediaries.
Insurer board-level dashboards reporting on multiple risk types.
Avoiding the multiplication trap
Multiplying ordinal scores is mathematically meaningless and can produce decision errors (Cox, 2008). The recommended approach is a look-up matrix in which each cell colour is set by independent judgement, not arithmetic.
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