Risk prevention aims at avoidance of loss through insurance
Chances of risk are reduced by retention of risk
Loss prevention is nothing but retention of risk
Chances of occurrence of risk are achieved through transfer of such risks
Answer is Wrong!
Answer is Right!
The correct answer is: A. Risk prevention aims at avoidance of loss through insurance.
Risk prevention is the process of identifying and controlling risks in order to avoid or minimize potential losses. This can be done through a variety of methods, such as:
- Risk avoidance: This involves eliminating the risk altogether, such as by not selling products that are known to be dangerous.
- Risk reduction: This involves reducing the likelihood or severity of a loss, such as by installing safety features in a factory.
- Risk transfer: This involves transferring the risk to another party, such as by purchasing insurance.
Insurance is a form of risk transfer in which an insurer agrees to pay a policyholder for losses that occur as a result of a covered event. This can help to protect businesses and individuals from the financial consequences of unexpected events.
- B. Chances of risk are reduced by retention of risk is incorrect. Retention of risk is the opposite of risk transfer. It involves keeping the risk and dealing with the consequences of a loss if it occurs.
- C. Loss prevention is nothing but retention of risk is incorrect. Loss prevention is a broader term than risk retention. It includes all of the methods that can be used to reduce the likelihood or severity of a loss, including risk avoidance, risk reduction, and risk transfer.
- D. Chances of occurrence of risk are achieved through transfer of such risks is incorrect. The chances of occurrence of a risk are not affected by whether or not the risk is transferred. The only thing that is affected is who will bear the financial consequences of a loss if it occurs.