A special form of planned retention by which part or all of a give loss exposure is retained by the firm is called
A)hedging.
B)self-insurance.
C)passive retention.
D)noninsurance transfer.

Question

Quizplus · Accepted Answer

Self-insurance is a special form of planned retention where the firm retains part or all of a given loss exposure. It is also known as self-funding or self-insurance program. This is done by setting aside a fund to pay for potential losses instead of purchasing insurance. Self-insurance is a common practice among large corporations that have significant financial resources to cover potential losses. The benefits of self-insurance include cost savings, greater control over risk management, and flexibility in tailoring coverage to specific needs. However, self-insurance also requires significant financial resources and expertise in managing risk.

A Special Form of Planned Retention by Which Part or All