When a company decides not to purchase insurance to cover a risk, it is pursuing what type of risk strategy?

Question

Quizplus · Accepted Answer

When a company decides not to purchase insurance and instead chooses to pay for potential losses out of their own funds, it is pursuing a retention risk strategy. This can be a viable option for small risks or risks where the potential cost of insurance outweighs the potential cost of the loss.

When a Company Decides Not to Purchase Insurance to Cover