Sabeka Inc has discovered that one of its products may cause consumers to suffer a certain form of property damage.In response to that risk, the company has written an exclusion clause into its sales contracts.In doing so, it has adopted a form of risk management known as risk shifting.

Question

Quizplus · Accepted Answer

The statement is true. By excluding liability for property damage caused by their product, Sabeka Inc is shifting the risk to the consumer or a potential third party. This is an example of risk shifting, where one party transfers the risk to another party.

Sabeka Inc Has Discovered That One of Its Products May