An insurance company that sells earthquake insurance in an area where earthquakes are possible has subjected itself to the risk of insolvency if a severe earthquake occurs.An insurer can safely sell earthquake insurance in this area if it shifts the risk of catastrophic loss to another insurer.The shifting of insured risk from one insurer to another insurer is called

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Reinsurance is the process of one insurer transferring or sharing some of its risk with another insurer, in order to reduce its own risk of catastrophic loss. Therefore, the best choice is D, reinsurance.

An Insurance Company That Sells Earthquake Insurance in an Area