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In context of insurance, ‘risk retention’ indicates a situation where
Answer & Solution
Correct Answer:
Option
D
Risk retention is a situation where one decides to bear the risk and its effects. Risk retention is a company's decision to take responsibility for a particular risk it faces, as opposed to transferring the risk over to an insurance company. Companies often retain risks when they believe that the cost of doing so is less then the cost of fully or partially insuring against it.
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