Which term means the consequence level of a loss event, independent of its likelihood?

• A. Severity
• B. Risk
• C. Hazard
• D. Exposure

Answer: (A)

The main idea here is the measure of how bad the outcome would be if a loss event happens, regardless of how likely it is. That measure is called severity. Severity describes the magnitude of the consequences—how severe the damage, injury, or impact would be—without considering the probability of the event occurring. In risk thinking, risk is about both how likely something is and how bad it would be, so it combines likelihood with severity. Hazard refers to the potential source of harm, not the size of the damage, and exposure is about how many people or how much asset are exposed to the hazard. So severity is the term that best fits the description.