Hi Chris
Perhaps looking at this from a position somewhere between you and the process safety people!!!
In general, you only have failure rate data either based on theory or derived from sufficient data from real life incidents.
There is limited benefit in, stating that the failure rate for scenario D (for Disaster!) happening is 60 x 10-4 per annum if your data set is so small that the 95% confidence limits are 60 (+ or minus 50) x 10-4 per annum, such that it is not that improbable that the actual rate is 1/6 of stat stated, but equally might be nearly double.
So, to use the example you cite of the LPG tanker there IS enough data compiled by people such as the World LPG Association and its UK counterpart to give you some reasonably sound probabilities for various types of incident scenario, such as hot and cold so called "BLEVEs", other scenarios where the tanker might go bang, and rates of release when e.g. there is a failure of hose or pipe when loading and unloading.
So, it is possible to do things like Quantified Risk Assessment ('QRA') and map out zones around some potential source of an incident to show e.g. where the individual risk of death or "dangerous dose" per annum ('IR') is at or exceeds defined parameters.
So, as example, in "R2P2", HSE suggest that if an IR is less than 1 in a million per year it will usually be "broadly acceptable" UNLESS the population is at particular risk e.g. elderly people or someone with disabilities in residential care nearby - where HSE set a parameter of 0.3 in a million per year as the border line for the "broadly acceptable".
If you then contrast this with most of the risk scenarios that mainstream OSH professionals deal with, it is VERY rare that QRA is possible.
As example, you could probably get a reasonable estimate for the number of fatal accidents per year during roofwork in the UK - used to be about 10 a year.
BUT, you cannot translate that to a reliable IR, firstly, as you don't know the size of the population at risk - you can get a reasonable estimate of the number of people who are defined as "roofers", but it's not only "roofers" who do "roofwork".
...and then, even if you could come up with a reasonable guestimate as to the total number of people in the UK engaged in "roofwork" each year, you would then have to add in lots of variables as to
(a) the slope of the roof and what it is made of - some materials inherently more slippery than others etc etc.
(b) what permanent or temporary protections are in place to stop people falling from open edges or through fragile materials
(c) how long they are up there for and how often - so as to tot up the total number of hours of exposure per year