Quantitative Risk Analysis

Risk analysis is a broad area of methods and applications, including risk assessment (identification, evaluation, and quantification of risk) and risk management (decision-making). Quantitative risk analysis (QRA) includes the calculation of the two components of risk: the magnitude of the potential loss and the probability that the loss will occur. Engineering QRA covers a risk assessment of hazardous socio-technological processes, where the losses can be described in terms of human, environmental, or economic losses. One of the objectives is to show compliance with safety objectives expressed by numerical probabilistic criteria, called acceptable risk. Further objectives are to identify weak points, search for design improvements and even to optimize the system. In the engineering risk analysis, there is usually a regulatory framework, including a regulator (safety authority) who stipulates the requirements for QRA. Choice of QRA methods is an application area-specific issue. In the decision-making, risk acceptance criteria are commonly used together with the expected utility principle to choose between acceptable options.